San Francisco Q2 2019 Real Estate Market Report

July 2019 Update

After 2 quarters of no or negative year-over-year home price appreciation, a confluence of positive economic factors sent San Francisco median home sales prices to new peaks in Q2. On a quarterly basis, the median house sales price hit $1,700,000 - $80,000 above the previous peak in Q2 2018 - powered by a monthly high of $1,770,000 achieved in June. For condos, the new quarterly median price peak was $1,250,00 - slightly above last year's $1,235,000 - fueled by a new monthly high of $1,300,000 in June.

The market typically slows down significantly in San Francisco for the summer holidays through August before picking up again in September for a busy, though relatively short autumn selling season running through mid-November.

Sales & Prices by Property Type & Bedroom Count

Average Dollar per Square Foot Analyses

San Francisco Luxury Home Sales 

Hit New Peaks in Q2 2019

The second chart looks at all home sales of $5 million plus.

Selected Supply & Demand Statistics

Average days on market - all sales (chart 1),then broken out by property type and price segment (chart 2). Changing a pattern seen in recent years, Q2 2019 often saw the strongest buyer demand in higher price segments, instead of the more affordable price ranges.

Sales price to original list price percentages by property type and price segment - these statistics generally mirror those seen above in the days on market analysis. Some of these percentages are stupendously high, reflecting torrid bidding competitions between buyers for appealing new listings.

Percentage of Listings Accepting Offers 

(i.e. Going into Contract)

Percentage of Active Listings 

with 1 or More Price Reductions

The effect of over-pricing - as signified by price reductions prior to sale - on the average sales price to list price percentage, average days on market, and average dollar per square foot values.

Mortgage Interest Rate Trends since 1981

San Francisco Real Estate 

High-demand/low-inventory spring market brings median home sales prices bouncing back to 2018 peaks. San Francisco luxury

June 2019 Market Report

Median Home Sales Prices

Median House Sales Prices since 1990 - 

The Long-Term Perspective

Luxury Home Sales Hit New Monthly High

Comparing Year-over-Year Spring Markets

Median Price Changes in Selected Districts

We chose these districts to illustrate a range of price points in areas with a good number of sales. Some are up, some are down, some have relatively unchanged median sales prices: It fits in with the overall, city price stability mentioned earlier. Full-year 2019 median home prices may be significantly different than the year-to-date figures.

Further down is a link to an updated San Francisco home price map, featuring the last 12 months of sales.

Neighborhood Home Prices - 

by Bedroom Count

Following are 2 sample tables breaking out median house and condo sales prices over the past year in 3 city districts by bedroom count. Some neighborhoods had relatively few sales of a particular home size. 

Click on the button-links below for our complete review of San Francisco neighborhood home prices.

Selected Market Indicators

Besides giving more perspective to longer-term trends, these two charts are also excellent illustrations of how seasonality affects supply and demand statistics.

Selected Demographic & Economic Snapshots

This next chart graphs Bay Area unemployment rates from 1990 through January 2019. By April 2019, they had typically fallen another half percentage point.

Highest SF Neighborhood Appreciation Rates - 2017 to 2018, Median House Sales Prices

A reporter asked for this list above, so we thought we would share it here as well. 

Almost all these neighborhoods are along the western and southern borders of San Francisco, where the most affordable houses are found.  (There is an SF neighborhood map a bit further down on this web page.) All of them have at least 35 house sales annually, and many have more than 50. All of them except for Outer Richmond had 2018 median house sales prices below, and usually well below, the city's overall median house sales price ($1,600,000). 

Appreciation rates in recent years have been highest in more affordable markets in San Francisco, and, generally speaking, this has been true throughout the Bay Area. Home prices in the more expensive SF neighborhoods appreciated less, or were basically flat year-over-year. 

Houses have been appreciating faster than condos, because of supply and demand issues - among other factors, thousands of new condos have been coming on the market in the last 3-4 years, deeply affecting supply and demand dynamics. So, all the highest appreciation rates pertain to house sales.

San Francisco Real Estate

High-Demand Spring Market Slightly Below Last Year's Home Price Peaks

May 2019 Report

With April’s end, we now have 2 months of spring season data unaffected by the end of 2018, when financial markets plunged. As of early May 2019, stock markets have recovered to hit new highs, interest rates are far lower than last year’s peak, and our local, unicorn IPOs have begun to roll out after a media frenzy of speculation on their potential effects on the market. 

The market has heated up considerably from the slowdown in the second half of 2018, with strong buyer demand for a very limited inventory of listings. Median home sales prices have returned to highs close to those in spring 2018, but, so far, last year’s peaks have not been exceeded. This is a big change from the year-over-year appreciation rates of the past 6-7 years. 

However, there are still 2 months of spring sales data to come in (before the typical summer slowdown),and word on the street is that some new listings are again generating feverish bidding wars between buyers. 

Monthly Median House Sales Prices

Monthly median sales prices are often affected by other factors besides changes in fair market value – for example, the extreme seasonality of luxury home sales – but the above chart helps illustrate trends over the past 2 years: Spring 2018 was one of the hottest markets in history, with dramatic year-over-year price appreciation. The market then cooled, stock markets turned scary, and interest rates climbed. 2019 has heated up again, but, so far, 

without any y-o-y median price gains.

The most expensive housing market in the country has, for the time being, stopped becoming more expensive.

Year-over-Year Comparisons

The table below compares the March-April market statistics of 2018 and 2019. Prices were stable, overbidding was down, and luxury home sales were up, but most statistics were remarkably similar to last year's. The SF and Oakland-Berkeley markets are currently the strongest in the Bay Area.

Home Sales by Price Range & Bedroom Count

Condos now constitute the biggest share of sales in San Francisco, which mostly explains the high columns for 1- and 2-bedroom sales in the $500,000 to $1.5 million range.

District Sales & Median Home Prices

The next 2 charts break down the last 12 months of sales by Realtor District (delineated on the map above). Some districts were split into 2 for these analyses, but all these areas contain neighborhoods of differing characteristics and home values.

House Sales, Median Prices & Median Sizes

The two biggest districts by volume of house sales - Bayview/ Excelsior/ Crocker Amazon (D10) and Sunset/ Parkside/ GG Heights (D2) - are also 2 of the 3 most affordable districts for purchasing a house in the city. Many of the older districts with bigger, more expensive houses are relatively small markets. 

Condo Sales & Median 2-BR/2-BA Condo  Prices

Condo sales in SF run across a wide range of eras and styles, from Victorian and Edwardian units in small buildings, through brand new, ultra-luxury high-rise penthouses. The breakout of median sales prices pertain to 2-bedroom, 2 bath condos only.

San Francisco Luxury Homes Markets by District

We typically define the SF luxury house market as houses selling for $3 million+, and the luxury condo, co-op and TIC market as those selling for $2 million+. 

SF Luxury House Sales by District

The central Noe, Eureka and Cole Valleys district (D5) dominates the market for houses selling from $3 to $4.99 million. The northern Pacific Heights-Cow Hollow district (D7) dominates the $5 million+ ultra-luxury segment. But high-end home sales are scattered across the city.

Luxury Condo, Co-op & TIC Sales by District

Luxury condo sales are concentrated in 3 districts: District 9, where most of the newer, high-rise, luxury projects are found in the South Beach/Yerba Buena area (which 30 years ago was filled with parking lots and auto-stereo shops),and in the old-prestige, northern neighborhoods of Districts 7 & 8, which include Pacific Heights and Russian Hill. (This is also where the city's high-price co-op units are clustered).

Q1 2019 "Ultra-Luxury" Homes Markets

We start the "ultra-luxury" segments at $5 million for houses, and $3 million for condos and co-ops. There has been a large (and continuing) surge in the construction of very expensive condo projects over the last 15 years, which makes for a greatly increased inventory of high-price condos for sale - and softer market dynamics.

House Size & Era of Construction

The sizes of houses built in earlier periods have increased over the years due to renovations: Adding that 2nd bathroom, or a 3rd bedroom behind the garage. 

Condos have become the major alternative for people purchasing homes of smaller size. 

Selected Demographic & Economic Factors

Population Growth

Our latest burst of growth - an increase of about 78,000 or 10% - with all its social and economic effects, looks paltry compared to the 1940's, when the city's population soared by 140,000, a jump of 22% that began with WWII.

Commuting

Venture Capital Investment

In recent years, the Bay Area has been the biggest destination of venture capital investment dollars in the country - and probably the world. These tens of billions of dollars have constituted a massive factor in the local economy, supercharging the creation of new companies, hiring, and, eventually, IPOs. Venture capital is effectively seed money that has exploded into the creation of stupendous amounts of new wealth.

It is impossible to know how median and average value statistics apply to any particular home without a specific comparative market analysis. 

These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in San Francisco and the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term. 

Compass is a real estate broker licensed by the State of California, DRE 01527235. Equal Housing Opportunity. This report has been prepared solely for information purposes. The information herein is based on or derived from information generally available to the public and/or from sources believed to be reliable. No representation or warranty can be given with respect to the accuracy or completeness of the information. Compass disclaims any and all liability relating to this report, including without limitation any express or implied representations or warranties for statements contained in, and omissions from, the report. Nothing contained herein is intended to be or should be read as any regulatory, legal, tax, accounting or other advice and Compass does not provide such advice. All opinions are subject to change without notice. Compass makes no representation regarding the accuracy of any statements regarding any references to the laws, statutes or regulations of any state are those of the author(s). Past performance is no guarantee of future results.

San Francisco Real Estate

March 2019 Report

Spring 2018 was one of the hottest markets in SF and the Bay Area in the last 2 decades. Then the market began to cool in summer and autumn - demand, sales and appreciation rates generally dropping, while supply and price reductions increased - before the mid-winter doldrums took hold. The magnitude of these changes varied by county, with SF less affected than many others, but still certainly affected.

Since the recovery began in 2012, spring has typically been the most active season of the year, and usually the period during which appreciation gains have been the largest. The spring 2019 market is just getting started amid a diverse set of economic indicators. Financial markets have, so far, recovered in 2019, interest rates have dropped, and big local IPOs loom. We will know much more soon.

Long-Term, Annual Median Price Trends

3-Month Rolling Figures

Looking at 3-month rolling median sales prices, the SF median house price was virtually unchanged on a year-over-year basis, while the median condo price (second chart below) ticked up a little - but the critical issue is what will happen in the spring months, when sales volumes are much higher.

1998 - 2018, by District

Markets appreciate due to a wide variety of local and macro-economic reasons: economic cycles, industry booms, inflation, consumer confidence, interest rates, employment, gentrification, new construction, comparative affordability (to other nearby markets),population growth, buyers’ median age, commuting, fashion, and so forth. The combination of factors affecting any particular neighborhood or district in the city is often specific to that market.

In SF and around the Bay Area, more expensive homes have generally appreciated less than more affordable homes, especially over the last 3-4 years. On the other hand, during the last downturn after 2008, the prices of more expensive homes usually declined significantly less. These appreciation percentages should be considered very approximate.

1998 - 2018

1998 - 2018

as of March 1, 2019

March 1, 2019

The number of active listings fluctuates daily, and the numbers below are increasing as more new listings come on market. These next 3 charts are snapshots of active listings on March 1st.

with Median LIST Prices. 3/1/19

The supply of listings available to purchase varies widely between city districts, which can be a simple reflection of market size and/or an indicator of supply and demand dynamics. If median LIST prices (below) are well above 2018 median SALES prices (delineated earlier in this report),it is typically a sign that the balance in listings for sale is disproportionately weighted towards higher priced properties, where demand is softer - and/or a sign of overpricing beyond what buyers consider fair market value.

with Median LIST Prices, 3/1/19

Market Seasonality

New Listings Coming on Market

New inventory usually starts pouring into the market right now, in early spring, to fuel the biggest selling season of the year.

Active Listings on Market

Sales Volume by Month - General Market

The number of sales in the first 2 months of 2019 was down from the same period of 2018, but these are the 2 lowest sales-volume months of the year. A much more significant indicator will be what occurs over the next 4 months during the classic spring selling season. Sales are a somewhat lagging indicator, as they mostly reflect new listings and accepted-offer activity in the previous month or two.

Luxury Home Sales by Month

The luxury home segment is, if anything, even more fiercely seasonal than the general market. The vast majority of activity usually occurs in spring and then spikes again in early autumn.

Market Statistics by City District

In SF and around the Bay Area, higher-priced areas have generally had somewhat cooler markets than more affordable markets in recent years, which is reflected in the next 4 charts. But home price is certainly not the only factor at play in these different neighborhoods.

Sales Price to Original List Price %

Any percentage over 100% reflects overbidding of asking price. Though these percentages have declined somewhat in the past 6 months, they are still incredibly high compared to most other places in the Bay Area and the U.S..

Unlike the house market, various city districts have seen high volumes of newly constructed condos in the last 3 to 4 years, and the increased supply has affected the condo markets in those areas.

Average Days on Market by District

Comparing Bay Area Markets

as of March 1, 2019

as of March 1, 2019

Bay Area Median Sales Prices, Q4 2018

On a quarterly basis, the highest median house sales price in the Bay Area has been alternating between San Francisco and San Mateo Counties.

County to County Migration

People move to SF and the Bay Area from all over the country and the world, and people leave to move to a vast number of locations, for differing reasons. This analysis looks at those counties with the greatest number of people moving to and from SF. In many cases, there is a large exchange between 2 counties, with residents going in both directions. Often, but not always, the outward flow is greater to counties with more affordable home prices, but there are many factors - such as schools, employment and quality of life issues - at play. (Cook County is where Chicago is located.)

Demographics Snapshot

San Francisco vs. U.S.

San Francisco, as well as the greater metro area, is very highly educated against national norms.

Disparity between the Sexes

An indicator of the income-generating value of education, along with an unhappy indicator of where progress remains to be made in income equality. (As an aside, real estate is certainly one of the first professions that saw income equality established between the sexes: Women have been holding their own and sometimes dominating rankings of top Bay Area agents for many decades.)

The statistics in this report are very general and approximate indicators based upon listing and sales data pertaining to assortments, of varying size, of relatively unique homes across a broad spectrum of locations and qualities. How these statistics apply to the current value, appreciation trend, and prevailing market conditions of any particular property is unknown without a specific comparative market analysis.

San Francisco Real Estate

Looking Back on 2018

January 2019 Market Report

There were almost too many local, national and international political, economic, social and ecological factors impacting the 2018 market to count. In the first half of the year, market conditions were about as hot as they've ever been, and there were staggering year-over-year appreciation rates. Come summer/early autumn, real estate and financial markets began to shift distinctly cooler. Looking at 2019, there are many wild cards whose impacts are difficult to predict: extremely volatile financial markets, fluctuating interest rates, contentious national politics, international trade issues, spiraling debt levels, employment growth - and a dramatic surge of local high-tech unicorns that plan to go public, which could create a tsunami of new wealth in the Bay Area.

Year-over-Year Annual Appreciation

Comparing 2018 to 2017, the median house sales price jumped 13% or $185,000 to $1,600,000 - the largest annual dollar increase ever (not adjusted for inflation) - and the median condo price increased by $60,000 to $1,210,000.

Year-over-Year Appreciation by Quarter

When one breaks 2018 down by quarter, it is clear that the big increases in price occurred in the first half of the year, after which the median house sales price declined. By the 4th quarter of 2018, the quarterly, year-over-year median house appreciation rate had basically dropped to zero. Condo prices were basically flat Q2 to Q4. This trend of high appreciation rates in the first half plunging during the second half was relatively common around the Bay Area.

Home Prices by San Francisco Neighborhood

The city has more than 70 neighborhoods, and our tables of median house and condo prices by bedroom count run 6 pages. Below the map are 4 tables of selected neighborhoods - let us know if you would like the full reports.

SF Home Sales by Price & Property Type

SF Housing: Era of Construction

Luxury Home Sales Trends

Short-Term & Long-Term

As seen in the next 2 charts, luxury home sales have, generally speaking, held up quite well in San Francisco, though there was an increase in high-end listings withdrawn from the market without selling (3rd chart below).

The number of luxury home listings that were pulled off the market without selling climbed at the end of 2018. Many will be re-listed in 2019.

Selected Market Indicators

The dramatic decline in house listings coming on market (red line) has been a major factor in the median house price appreciation rate since 2012. Condo listing inventory has been significantly impacted by new-condo construction during this period.

Price reductions and listings pulled off the market without selling both hit new highs since the recovery began in 2012.

Hiring has continued to fuel the SF and Bay Area economy. So far, it has continued to hold up.

After a big jump in autumn, interest rates saw a drop of similar magnitude through the first week of January, which is good news for real estate markets.