“It is a bifurcated market, with continued brisk sales of homes in desirable neighborhoods, especially in the $750,000-and-up range. At the same time, lower-priced homes, and houses in outlying areas, are simply not moving — in large part because tighter lending standards, a fallout of the subprime loan crisis, mean there are fewer entry-level buyers. The shift in market mix has caused median prices to continue rising, despite the hordes of buyers sitting on the sidelines.” (Would-Be Home Buyers Hesitate)
The article has an accompanying graph showing a clear bifurcation between SF and the suburbs in % of homes that have reduced their sale price. However, it doesn’t provide data to support a bifurcation in sales above and below $750,000 within the city of San Francisco. Is there data that cheaper SF homes are staying on the market longer than more expensive ones, or is this bifurcation really just city vs suburbs?
Posted today by sf.curbed.com: a map of homes in SF on the market longer than 60 days. From the map, it appears that many of the homes (on the market a long time) are in the Southeast of I-280 area, where many of the cheaper SFRs and fixers in town are located. Don’t know whether or not this southeast preponderance of slow moving homes is a new phenomenon.
I’m selling my 828 sq ft mid-century starter condo in San Leandro this fall, before I move to The Hayes at 55 Page, and I had already somewhat anticipated this. On one hand, I’ll allow for as long as 90-120 days to sell my place, but on the other hand, where I am (94577) and what I’m offering (2bd/2ba one block from major retail complex and three blocks from BART) is not going to be found anywhere else in Alameda County for around $370,000. And certainly not someplace as pleasant and as safe as San Leandro for that price. Point being, I don’t think one size fits all – I think there are a lot of pockets of opportunity, and pockets that are moving very slowly, and I am sincerely happy things are getting easier for buyers. It is stressful enough in the first place. I wish them luck timing the market, as very few will be successful with that.
I know this is a city focused site – but – if you’re priced out of the city – take a good look at San Leandro – it’s a great place to live. I can get to the Embarcadero faster (5 min walk + 24 minutes BART) than many people living West of Twin Peaks.
Here’s a thought. People who are in the market to trade up don’t really have the same incentive to wait out the bubble as those who are buying first homes, since bubble deflation impacts the asset that they are selling as well as the asset that they are buying. Perhaps that helps explain some of the bifurcation in the market?
Here’s another thought “affordability matters to everyone”.
It matters even to the high end because every entry level purchase generate 4 more ‘move up’ purchases. The ‘Bifurcated’ market is occuring because there are no more, or very few, affordable ‘entry level’units.
What we are seeing is the lag between the collapse of the first time buyers market, caused by affordability issues, tightening credit, and rising interest rates, and the collapse at the top of the move up market.