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August 20, 2020

SF Single-Family Homes Not Immune To Price Reductions

Houses in San Francisco are always in demand among buyers. And this property type has stood its ground during our current recession—in fact, the average price of a house from June 1 – August 15th has increased by 6.7% to $2,141,356 in comparison to the same time in 2019.

But single-family home sellers are no strangers to the dreaded price reduction decision. Some homes come on the market with high prices in comparison to their comparable sales; it’s no secret that there’s a tendency for homeowners to believe their house is superior for one reason or another.

I took a look at all the houses that sold from June 1 through August 15th and discovered that 17% sold after having at least one price reduction.

A quarter of these reduced homes changed hands for up to $1.5M. But 58.5% sold in the $1.5M-$3M range, which shows you where there may be a soft spot in this market if a home sits for a while.

Most of the reductions were scattered among various neighborhoods. However, there were two neighborhoods that saw more frequent price reductions—Noe Valley in the $2.6M-$5,375,000 range, and Eureka Valley from $2.1M-$3.4M. Future sellers at these price points, take heed.

The awards for steepest reductions prior to closing go to three homes in the north end of town:
145 25th Avenue (Lake)
Orig Price: $4,295,000
Reduced: $4,080,000 | $3,799,000
Sold: $3,550,000
Days on market (DOM): 236

123 Laurel (Presidio Heights)
Orig Price: $6,750,000
Reduced: $6,295,000
Sold: $6,200,000
DOM: 50

2837 Greenwich (Cow Hollow)
Orig Price: $5,500,000
Reduced: $5,200,000 | $4,995,000 | $4,500,000
Sold: $4,125,000
DOM: 99

If you’re in those upper price ranges and you see a home spending time on the market, stick with it and you can probably find the sweet spot that will satisfy buyer and seller.

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