Where is the Market Going?

Everyone wants to know the answer to that question. This Fall's market is not over (especially since there are usually a large number of sales in October that close in November) but there is certainly something to talk about. What's going on?

Overall, the market is still quite healthy and could only be called a seller's market. Median price for all properties in October was $1,397,500, up 8.1% over last October and just slightly below the highest ever median in March of this year ($1,406,000). The bigger news is that the total number of completed sales last month was 7% lower than last year as was September's sales. And inventory (active listings) was up almost 8%. Of course, it may be that this Fall's sales will be piled up into November, but if not then these statistics seem to indicate buyer skittishness along with sellers' refusal to lower prices to stimulate sales. That is consistent with a change in the market toward slower appreciation. There is another possible explanation, however. The midterm election season has produced an extraordinarily negative press environment and stock market jitters also have the public feeling worried or at least uncertain. Uncertainty is always bad for the market, but after that uncertainty is resolved (in this instance, by election results) the market bounces back. That happened after the surprising results of the 2016 election sank in (and the economic sky did not fall) and could happen here also. So November's numbers will be telling, but we may have to wait for the beginning of the Spring market to know where we are going.

What about the various areas of the city? Every area of the city was up except two, but mostly by modest amounts. District 1 (Richmond) and 2 (Sunset) were up 6.8 and 5.2% with the Richmond continuing to outpace it's across-park rival by more than $200,000 ($1,650,000 versus $1,425,000 median). Districts 4 (West of Twin Peaks), 5 (Castro, Noe, Haight) and 9 (Mission, Bernal, SOMA) were also solid, but not spectacular players (respectively, $1,700,000 (+8.6%), $1,650,000 (+6.5%), and $1,260,000 (+7%). The biggest gainer was District 3 in the southwest corner of the city, up 17% to $1,200,000 and nearly equal to traditionally more valuable District 9 and 6 (Hayes, NOPA, Lower PacHts - which was down 7.6% to $1,270,000)

The biggest loser was District 7, down 14.9% to $1,625,000 which is actually lover than Districts 1 and 4. This is likely an anomaly (although also true in September) because District 7 has alway significantly outpaced the rest of the city nearly every month in the last 10 years. Lastly, District 10 in the southeast corner of town is now consistently over $1,000,000 in median price, a mark the rest of the city met awhile ago. In October is was up 13% to $1,030,000, but has been over $1m since July. (District statistics are 3 month rolling averages to account for relatively low numbers of sales in any area in any particular month.)  More statistics here.

Anecdotally, I agree with most agents that nice properties in desirable areas without any significant "problem" are still selling quickly (median of 16 days, the same as last year) and for good prices. This is particularly true at the lower ends of the market where the buyer pool remains much larger than the available inventory. But at the higher end (above $3 million where the buyer pool is inherently smaller) and especially for properties that are not presented well or include aspects that do not appeal to many buyers sales are not as easy. If you have a property - or want one - the best course is to talk to a full-time agent who knows the market and has the ability to analyze your specific situation. I'm always happy to help, and it starts with a talk.

 

Transbay Transit Center News

Everyone is probably aware that our brand new Transbay Transit Center is closed to transit (bus) traffic for now due to cracks that developed in the steel supports that hold the structure over Fremont Street. So far no announced cause or solution, but of course  everyone is on it. And the good news is that the park on top of the structure will probably reopen sooner - as soon as engineers can determine it is safe for people. So for those who did not see it when it was open for a bit (grand opening was August, closed in September), just wait a bit longer or find a friend who works at Salesforce or lives in one of the several apartment towers around and view it from there. Or just walk around it - the screen and cacophony of structures are a visual delight on their own.

What is the Transbay Transit Center for anyway? Right now it is a (temporarily closed) bus terminal for Muni, as well as commuter and long range buses run by ACTransit, WestCAT, Amtrak and Greyhound. But the grand vision is to make it our 21st century rail hub, with Caltrain and High Speed Rail lines right into downtown. When will that happen?

One step toward making it a reality occurred in September when the city chose a path for the "Downtown Extension" which will bring those trains from Caltrain's existing terminal at 22nd Street on the eastern edge of Potrero Hill. The city chose a tunnel under Pennsylvania Ave more or less following the existing Caltrain tracks to 4th and King, then continuing along King and up 2nd St to the terminal. This tunnel is scheduled to be completed in 2027 and cost $6.1 billion - all subject to approval by various other agencies and construction timeline and cost overruns, of course. Let's hope it goes better than the Chinatown subway project which is still under construction (since 2010) and now may not be open until 2021. (And note that the city is already planning the next phase of that line, extending it to North Beach and Fisherman's Wharf, with several options to go further along the waterfront or out through the Richmond to the Presidio.)

Completion of the rail link to downtown and repairing the terminal should be top priorities as San Francisco's core continues to grow and surface transportation becomes untenable. The rail link will also provide additional service from the booming new Mission Bay neighborhood, the almost finished Warriors arena and Dogpatch's Pier 70 development. All aboard! More details herehere and here.

Cole Valley

Beloved Cole Valley is one of San Francisco's most charming and authentic neighborhoods. Bounded by Carmel, Clayton, Waller and Stanyan (and included with adjacent Parnassus Heights in SFAR's real estate district map), it is centered on the small business district along Cole Street from Frederick to Parnassus. The area is filled with charming Edwardian houses and small apartment buildings, tree-lined short streets like Grattan, Belgrave and Alma and a small-town vibe. But it's also just a few blocks from the decidedly busy Haight-Ashbury District and connected by the N train tunnel under Buena Vista Park to Duboce Triangle and on to downtown. It is exactly what many people want in their San Francisco life - quiet, unique neighborhood character in the middle of the city. Property values bear this out - Cole Valley median prices (for all properties) have steadily increased  over the past 10 years to hit $1,825,000 in October, up 50% in that time period (but note that very small numbers of sales in the area wildly skew statistics - single family price medians have been as high as $3.9m and as low as $1.6m during that period). We who live in and around this charming little neighborhood are truly lucky and intend to make sure it stays a great place to live, love and thrive! History, pictures and more information herehere, and here.