A monthly analysis of the San Francisco real estate market. San Francisco Homes Continue to Sell Fast and High as Inventory Drops.
The first month of 2013 brought the same type of market behavior that San Francisco has been experiencing for some time now. With the already low inventory of homes for sale being consumed at such a rapid rate, bidding wars have broken out throughout parts of the city and overall buyer demand remains high. As home prices continuing to rise, confidence among potential home sellers is sure to bolster inventory and the housing market in the coming months.
Single-Family Home Sales
Compared to January of last year, the inventory of single-family homes for sale in the city dropped by 40.3 percent, to a total of 380 properties. The number of homes under contract also fell by 9.6 percent, while the number of homes sold increased by 16.9 percent, to a total of 152 properties sold.
For homes that were priced below $700,000, the months of supply inventory shortened by as much as 53.3 percent to a reading of 1.2 months. For higher-priced homes between $700,000 and $1.2 million, the months of supply inventory also fell, by 58.7 percent to 1.1 months.
Condominium Sales
Similar to single-family homes, the inventory of condominiums for sale in the city dropped by 40.3 percent, to a total of 498 condominiums. The number of condominiums under contract rose by 12.6 percent, while the number of condominiums sold also fell by 6.2 percent, to a total of 151 units sold.
For condominiums that were priced between $500,000 and $900,000, the months of supply inventory tapered by 53.9 percent to a reading of 1.2 months. For luxury condominiums priced above $900,000, the months of supply inventory also dropped by 64.9 percent to 1.5 months.
Outlook
The consumer confidence index, which had declined in December, fell further in January. The index now stands at 58.6, down from a reading of 66.7 in December. Lynn Franco, Director of Economic Indicators at the Conference Board, says that, “Consumer confidence posted another sharp decline in January, erasing all of the gains made through 2012. Consumers are more pessimistic about the economic outlook and, in particular, their financial situation. The increase in the payroll tax has undoubtedly dampened consumers’ spirits and it may take a while for confidence to rebound and consumers to recover from their initial paycheck shock.”
According to the EDD, San Francisco County registered the third lowest unemployment rate (6.5 percent) among California’s 58 counties as of December 2012. Jobs located in San Francisco County increased by 4.3 percent on a year-over basis as of the second quarter of 2012, according to the Bureau of Labor Statistics. That ranked the county 15th in performance out of the 329 largest counties in the nation and represented a year-over job expansion of about 26,000 jobs.
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