With November's numbers in the Fall market can only be summarized as very strong. The median sale price hit a new high for all properties of $1,332,500, up 12.9% over last year and over $80,000 up from September. That appreciation is across the board. Single family homes rocketed up to a median price of $1,500,000, an all time high except for last month when single family homes were at $1,575,000. Condos/TICs/coops were also up dramatically this Fall, closing at a new high in November of $1,230,000, over 16% higher than last year. Keep in mind, however, that November's appreciation may be misleading given the shock of the unexpected election results last year, which likely depressed prices (and sales) for a bit. The overall trend line is clear. San Francisco real estate continues to appreciate robustly with no end in sight.
What can we discern about the coming months? Anecdotally, many agents expect a strong Spring as inventory remains quite low - 28.7% lower than last November and almost 100 fewer available properties than any November in the past 10 years. The trend line for inventory appears to show a very long term decrease, since there were 600 available properties were routinely before 2013 when we slipped down below 400 and now and have stayed down. That lack of supply really drives the market as demand continues to be buoyed by new jobs and new residents. Days on market also sank to tie the lowest number ever (14), and overbids became more common again. These overall numbers can be deceiving, however. Homes over $3,000,000 were not overbid by nearly as much (10% less) and condos took almost twice as long to sell. Anyone in the real estate market, or who wants to be, can take heart in these numbers, however because they tell us San Francisco's market is stable and a good investment.
2-4 unit building sales were consistent with this picture. The median price shot up to $1,910,000, a 19% jump. Apartment buildings are also selling nearly twice as fast as last year (19 v. 30 days, median) and inventory has also moved down significantly. Multi-unit properties, like all residential real estate, continues to draw investors, be they long-term owners looking for steady rental income or developers looking to improve and sell. (As always, small numbers of 2-4 unit sales skew these figures, as well as the fact that many sales of apartment buildings (and other commercial properties) are not reported through the MLS.)
Every area of San Francisco appreciated substantially this Fall, but there continue to be long term divergences. In particular, after some volatility over the summer, District 7 (Marina, Pac Hts) is solidly ahead of every other area, with a median price of $2,012,500 more than 18% higher than last year. But the biggest winner was District 6 (Hayes Valley, NOPA) which shot up 20% to $1,355,000 after a banner October (Up 33.5% year over year). The other expensive areas,District 5 (Castro, Noe Valley, Haight) and District 1 (Richmond) continued their moderate increases hitting $1,617,500 (District 5-up 6.1%) and $1,587,500 (District 1-up 7.8%). The effect was for these two areas to slip substantially behind District 7 and coming very close to the West of Twin Peaks neighborhoods of District 4 which once again leapt up and now stands at a median price of $1,550,000, probably reflecting the desirability of single-family homes in nice neighborhoods.
That same trend helped District 2 (Sunset) where single family homes also dominate. That area was up 12.5% to $1,350,000. But the recovery of condo/TIC/co-op prices also helped areas where apartments are common, such as District 8 (downtown, Russian/Nob Hills) with was up 14.8% to $1,185,000 and District 9 (Mission, SOMA) up 13.6% to $1,175,000. District 3 in the southwest corner of the city surged in October but was not up quite so much in November, to finish the Fall season at $1,062,949. And District 10, the only area where a home can be acquired for a median price below $1 million, continues its rise although at a more moderate pace of only 11.1% ending at a median price of $900,000. (All district statistics are three month rolling averages, to mitigate for low numbers of sales.)
In summary, San Francisco's residential real estate market continues to show very strong gains and shows no sign of stopping. If you are interested in the value of your property or the one you want, give me a call so I can analyze your specific situation and use my experience and skills for you. More statistics, updated constantly, are at www.danslaughtersf.com.
Rosie is Here
In the 60s, as the space age gathered steam and rockets to the moon spawned dreams of an ever more futuristic world, we all thought robots - like Rosie in the Jetsons TV series - would soon help us do, well, everything. 50 years later we still have no individual jet-packs and robots are still not doing much more than sweeping the floor, but now it does look like we are soon to be in a new world. Robots are being designed - and used - to do an unbelievable number of tasks - delivering packages, manufacturing and driving cars, handling medical procedures, fighting wars and babysitting. Nanobots are being designed to go into tiny spaces, including inside the human body, and sometimes to act in swarms that communicate with each other. And AI - artificial intelligence - means that robots can learn from their experiences and do better than they were designed to do. All of this sounds very exciting and certainly does mean that we are on the verge of being able to take a big step forward in the evolution of what we can do, with robotic help.
But it also sounds scary. Privacy and civil rights may be compromised as robots can be everywhere all the time without sleep or food. Small drones could spy on us, take pictures from anywhere and have no "feelings." There was a controversy as San Francisco SPCA deployed a robot to patrol the sidewalk in front of its facility to deter crime. Some saw it as an attack on the homeless in that area even though the robot was only observing, acting as a 24-hour security guard. What are the limits of our privacy now that flying robots can see through walls? And even in the public sphere is there no place where we can be private?
On a larger scale, what about the loss of jobs as robots do all the work? Some estimate that 35% or more of jobs in the US will become obsolete by 2030. Will new jobs replace the old, as has happened with previous technological advances? (For example, when agriculture became increasingly mechanized in the nineteenth and early twentieth century, we needed far fewer farmers, releasing people to move to the city to work in new factories making new products that did not exist before.) Or will we see massive unemployment? Recently, one San Francisco supervisor proposed a tax on robots, so that they pay for the jobs they eliminate. Is this a viable plan or will it kill the innovation that drives the robot (and all new) industry? How do we set the tax and what if a robot is doing something no human could ever do? It's a brave new world but San Francisco's technology thinkers are at the forefront of these changes, aiming to profit from them but also to direct them in humane ways to help us all in keeping with our precious culture of love and community. We will get through these changes as we did those before, but we must act affirmatively to minimize the human pain that all change can produce. Go Rosie! More details on robot technology here.
Union Square is San Francisco's biggest shopping district, attracting locals and tourists to super luxury shops and mass market retailers. The area did not start this way. It was originally a fashionable residential district, with the square used as a baseball lot. It was named for the Union sides of the Civil War, which San Francisco supported enthusiastically. Many churches were on and around the square, as was the red light district, Maiden Lane. Around the turn of the century, however, retail arrived and made the neighborhood into something very like what it is today. Indeed, you can see a bit of the old Union Square inside Neiman Marcus where the rotunda from the original 1896 City of Paris department store remains, and also in the Westfield mall where the dome and .facade from the 1908 Emporium store were preserved.
Recently there have been big changes that will once again transform the area. First, is the new Chinatown subway with a station at Stockton and Geary in a corner of the garage under the square. As part of that construction, the city has closed off Stockton below Geary a a pedestrianized area during the holiday season and there is talk of making that permanent after the subway is completed.
In addition, driven by national changes in retail, largely the increase of online sales at the expense of in-store purchases, retail uses are shrinking - or some of them. In particular, the massive Macy's mens store has been sold to a developer who it appeared was going to turn it into office space. But that turned out not to be true, as Macy's has leased it back. And now the Main store is being redesigned to allow for smaller storefronts on the square. Saks closed it's men's store, relocating it to the main store at the corner of Post and Powell, while Barneys expanded into the adjacent building and put all of it's mens clothing in the new underground area, freeing the top floor for a new restaurant (not yet open). The Westfield mall has also shifted the locus of the square south activating mass market stores on and off Market Street and leaving the immediate area around the square to ever-changing luxury brands, recently, Prada is out and Fendi is in. Needless to say, the square remains a vital and beloved part of San Francisco. More details here, here, and here.
The Politics of Dancing
San Francisco is a nightlife city. From its origins as a Gold Rush boomtown through the wild years during WW II when sailors left for (and returned from) the Pacific theater, the cultural revolution of the 60s and the rise of the city's LGBT neighborhoods in the 70s and into the present day, the city has always been closely associated with music, dancing and nightlife. The segment has issues though. As residential areas have grown and entered into areas like SOMA that used to be filled with warehouses, the clash between sleeping neighbors and loud music/unruly crowds can cause disputes. But the city's Nightlife Commission has been able to preserve venues and mediate between differing needs and we have retained a vibrant scene. Now State Senator Scott Wiener has revived his proposal to extend drinking hours so that bars and restaurants can stay open longer, giving them more economic vitality and world class nightlife that can compete with New York, Las Vegas, London and so on. Senator Wiener's new proposal is to allow certain localities (including San Francisco) to choose whether and how to alter drinking hours to as late as 4 am. Some believe that later hours will discourage binge drinking by removing the "deadline' created by the current 2 am closing time; others think more hours to drink just means more drinking and more drunken, unacceptable behavior. The proposal seems reasonable though, since the city can always alter the rules if it appears that the new hours are not resulting in desired results. Let's try the experiment - maybe it will be a win for all of us and for young people who we must retain to remain a vital, relevant city. Check it out, here.