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April 5, 2017

Single-Family Home Market Kicks Off 2017 With a Bang

There were no winter doldrums for the San Francisco house market this year. Low inventory and strong buyer demand fueled the first quarter—activity that promises to continue in 2017.

Possibly motivated by the threat of rising interest rates, buyers frequently waived contingencies in competitive situations, foregoing inspection, appraisal and financing safety nets to increase their chances of landing a single-family home.

The average price for the 381 homes sold was $1,761,226, up five percent over the first quarter of 2016.

Only 29% of all homes sold at or below $1,000,000—most frequently in the Outer Parkside/Sunset, Bernal Heights, Bayview, Crocker Amazon, Excelsior, Outer Mission, Visitation Valley, Portola and Silver Terrace. And 24% sold for more than $2,000,000, most commonly in Noe/Eureka Valleys, and Pacific/Presidio Heights.

The selling pattern for single-family homes continues to be “list low, sell for more.” Buyers paid an average of eight percent over asking, but four neighborhoods in particular were hotspots for 20%+ overbids: Outer Parkside, Outer Sunset, Westwood Highlands and Westwood Park.

My three favorite crazytown overbids were:
1447 Funston (2BR/1BA)
List price: $1,299,000 | Sold: $1,860,000

263 Lakeshore (4BR/3BA)
List: $1,295,000 | Sold: $1,900,000

391 Day (3BR/2.5BA)
List: $1,995,000 | Sold: $2,525,000

And let’s not forget the exploding popularity of the single-family home fixer market. There were several high-flying fixer sales over the past quarter, with the pending sale at 165 Vasquez in Forest Hill Extension exemplifying this activity. This house was a total fixer/gut job listed for $1,050,000. 29 offers later—17 of which were all cash—the property is reportedly in contract for roughly $1,725,000:

Speaking of cash transactions, they represented almost a quarter of all sales in the city—something that will likely continue as long as the tech sector remains robust.

As for off-market sales? Only nine percent of all homes sold changed hands outside the MLS, and almost half of those were in the $2,000,000+ price range.

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