Marina Times – May’s mixed bag of real estate news

Sure, San Francisco real estate prices are high, it’s a seller’s market with fierce competition among buyers, and single-family homes are in higher demand than condos. Bla bla bla.

If you feel like you’ve read all of this before, imagine how I feel. I to know I’ve written everything before. And yet, each month I try to shed a little light on some aspects of the San Francisco housing market that you may not be familiar with.

First, the contrary view expressed in a SocketSite.com report in mid-April. “After hitting a seasonal 11-year high last week in San Francisco, the net number of homes on the market has since risen a further 8 percent, driven by a continued slowdown in the pace of sales and an increase in bidding activity and price cuts on the rise.

“In fact, there are now 70 percent more homes on the market than there were at this time of year before the pandemic; more than twice as many as at the beginning of April 2015; and most since 2011 on a seasonal basis.”

STAY CALM

Sounds promising for buyers, doesn’t it! But don’t get too excited, here’s the counterpoint. According to Redfin, from Jan. 1 to Feb. 15, 40 percent of homes sold in San Francisco were oversold for at least $100,000. The thought is that homes are currently selling at record prices and their values ​​are only going up.

In an April market report, the people at Compass explain that while San Francisco is the only Bay Area county where the number of active listings is higher than it was before the pandemic, this is due to an increase in housing listings: the active stock Singles Single family home listings continue to be lower.

The report says, “Sales were robust for all property types in the first quarter, but supply of home listings in particular was very weak.”

Meanwhile, mortgage rates have skyrocketed 50 percent through March 31, 2022, with the largest jump occurring in March. Still, the San Francisco real estate market appears largely unperturbed by higher interest rates, financial market volatility and worrying international events.

“The prevailing dynamic remains strong buyer demand competing for an insufficient inventory of listings for sale,” according to the Compass report. “Crowded open houses, multiple bids, violent overbids and quick sales are still common.”

Some buyers have been hurt by higher lending rates and falls in their stock portfolios, and some have postponed their purchase plans, but according to Compass “not enough to move the needle in relation to the fundamentally high demand/low supply conditions that dominated 2021.”

AND CONTINUE

Is there a silver lining for buyers out there? Taylor Marr, Redfin’s deputy chief economist, thinks that may be the case. He sees early signs that the housing market could be cooling in some expensive coastal areas – including San Francisco.

It’s not much, but here’s what he has:

First, the number of Google searches for “home for sale” fell significantly in the second week of March for these three markets: Boston (-15%), San Francisco (-14%) and Los Angeles (-13%). ).

Next, tours of homes for sale in California as of March 31 are down 21 percent from the first week of 2022. That’s a big reversal from the same period last year, when tour activity in California rose more than 76 percent.

Third, the number of San Francisco homebuyers applying for a mortgage fell 13 percent year over year in February.

Finally, Marr adds, “This time of year, the percentage of homes that are falling in price has grown at the fastest pace in at least seven years. While price declines are still a rarity, the fact that they are rapidly becoming more frequent tells us that sellers are reaching a limit on their ultimate control of the market, while buyers are reaching a limit on how much they are willing to pay for a home.”

These are also leading indicators. For homebuyers, sellers and realtors, the market still feels very hot and it may be a few months before competition dies down. I told you it wasn’t much of a silver lining – but like rain for Californians, buyers will take what they can get.

One final note: The Chronicle of San Francisco recently conducted a study identifying 10 real estate markets on the cusp of a San Francisco-style affordability crisis — where house prices have nearly doubled in a decade and where not enough new homes have been built to keep up with demand.

The cities are mostly smaller and mostly rural. Three are in Washington state, two in Montana, two in Utah, one in North Carolina and two in California – San Diego and Merced.

I don’t know about you, but I’m staying here.

Feedback: letters@marinatimes.com

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