Wednesday, April 22, 2015

Price differential between condos and TICs - update

We recently updated our quarterly report that looks at the differential between condos and TIC pricing.  TICs continue to have lower selling prices than comparably categorized condos.

The differential in sales prices is higher this year than the same period two years ago for two of the three categories (1br/1ba and 2br/1ba).  In the third category (2br/2ba), there were only two units sold in the first quarter of 2013 averaging more than $1.1million so the differential between 2br/2ba condos is distorted.

In a difficult and competitive market, TICs remain an attractively priced alternative.

The full report can be found on our website.

Monday, April 13, 2015

Little change -- low inventory

I've been away from the blog for a while but, as far as inventory is concerned, you haven't missed much.  We continue to have lower than normal inventory and lots of demand.  And even in San Francisco that's a formula for lots of competition and, ultimately, sales prices exceeding asking prices by an average 7-20%.

From our latest report here's a graph showing new listings (single family homes and condos) during each two week period.

We've been doing this report for almost two years so you can see that compared to last year inventory has followed the same cycle (as it does most years) with the lowest inventory between Thanksgiving and Christmas and then a steady climb into the spring market.  The difference is the number of new listings during each two week period this year is noticeably lower than it was last year.

The full report can be found at this link.

Monday, February 23, 2015

Luxury Collection Specialist

Just received my certification from Berkshire Hathaway HomeServices:

Sunday, February 15, 2015

Another perspective on the lease vs. buy debate

Many professional real estate associations in California publish or subscribe to standard forms documents/libraries.  Real estate agents routinely use standard forms from the California Association of Realtors.  In San Francisco our realtor association has its own purchase agreement forms and related documents.

These libraries of forms are created usually by committees of lawyers and practitioners with day to day experience in the field as well as expertise in local and state laws which affect real estate transactions, ownership and tenancy.

The San Francisco Apartment Association recently released its updated standard lease form.  As it points out in a recent article, they started publishing this form 25 years ago as a 4-page documents.  It has now grown to 17 pages!  And that doesn't include several addenda that it recommends depending on circumstances -- ranging from topics such as bedbugs to parking to pets to tobacco smoke disclosure.

By comparison, the standard purchase agreement from the San Francisco Association of Realtors is 7 pages long.  The California Association of Realtors purchase agreement form is 10 pages.

In the perennial debate over whether it's better to buy or rent (San Francisco throws many additional complex considerations into the mix), the difference between the length of a purchase agreement and a rental agreement provides a perspective you should consider, whether you're contemplating purchasing a single family home/condo, a multi-unit property, or if you're about to sign a lease.

Tuesday, July 29, 2014

Our Market in Microcosm ...

... if anything about a $1,100,000+ 2 bedroom, 2 bath single family home less than 1,000 sq. ft. can be referred to as small.

Four years ago this modest home on Potrero Hill (south slope) sold for $29,000 less than its original asking price.  It took almost 50 days to go into contract during which the asking price was reduced by $20,000.   It took another 50 days to close.

The same house (with a some mostly cosmetic improvements) has just sold for $420,000 more than it's previous sales price.  This time the property went into contract in less than two weeks after it hit the market and closed 40 days later.

I'm not identifying the specific house since that's not the point of this post.  (If anyone wants to know the specifics, feel free to contact me directly).  This particular transaction is of interest since the property is in essentially the same condition it was when it last sold.  That works out to be a 14%+ increase in value per year during the four years the the house was owned by the seller.
DJIA graph 2010 through 2014

That's about the same annual increase as the Dow-Jones Industrial stock overage has achieved over the same period.

Obviously, not every home in San Francisco has seen such increases in value.  There are a lot of variables that can affect pricing.  Nevertheless, our monthly and quarterly statistics tracking suggests that there will be more homes selling for over $1,000,000 in San Francisco than under a million by the end of the year!