3Q2004 San Francisco Real Estate Activity

You may remember my discussion about the economic rough patch we hit as the third quarter began in July. Economic data started coming in weaker. Jobs growth stagnated. Consumer spending slowed, and GDP followed suit. At the same time, the Fed began a campaign to bring the cost of funds off historic lows by hiking its benchmark bank-to-bank overnight lending rate. Mortgage rates rose slightly as a result, but markets generally disagreed with Fed sentiment in the third quarter, and rates didn’t rise on par with Fed hikes. This third quarter rate picture is, of course, based on the national economy. But property economics are much more localized. So this month, I wanted to show you some third quarter property data for San Francisco.

— Total SF properties sold in 3Q was 1,784, down 4.9% from 2Q. The decrease was due to less condominium sales activity.

— Average sales price decreased 3.4% to $807,642, due to fewer sales of higher-priced ($1.3M+) single family homes.

— Buyers got more cautious, with average days-on-market for listings increasing 13% to 34 days.

— Properties sold at an average of 7.5% above asking price, down from 8.1% in 2Q.

— The $500k to $800k price range was most active, representing 53% of all properties sold and 43% of gross sales.

— The most sales (357) were in the district encompassing SOMA, South Beach, Potrero areas; due to new development.

— This area (district 9) has high condo/loft concentration; it’s third cheapest in SF with average sales price of $685,181.

— Marina/Pac Heights is most expensive at $1,355,479. Bayview/Hunters Point is cheapest at $579,662.

What I find most interesting is that these data are also somewhat softer like the broader national economic data of 3Q. Still, the figures leave little doubt about the strength the San Francisco real estate market. If you want to get more information, call Katy McMurry from Urban Bay Properties directly at 415-863-KATY, she’s the Realtor who provided this data. Her website is www.sfurbanestates.com.