July 16, 2007
San Francisco Listed Housing Inventory Update: 7/16/07
While sales volume of single family homes, condos and TICs in San Francisco was running ~11% below 2006 levels in May, listed housing inventory is currently down ~18% on a year-over-year basis. A quarter of which (okay, so 24.3%) has been reduced at least once.
In terms of “official” listed inventory, that's right around two months. Of course there’s also a fair amount of “unofficial” (and unlisted) inventory to consider (and absorb) as well. And for those numbers you’ll just have to “plug in”
tomorrow Wednesday Thursday for our third quarter Complete Inventory Index (Cii) and update for San Francisco.
∙ San Francisco Home Sales Drop, Median Sales Price Up (Enter Mix) [SocketSite]
∙ SocketSite’s Complete Inventory Index (CII): Q1 2007 [SocketSite]
First Published: July 16, 2007 4:00 AM
Comments from "Plugged In" Readers
I have a feeling this site is about to get a lot more traffic with the Chronicle story. Way to go Adam!
[Editor’s Note: Thanks Jordan. And now in typical SocketSite fashion, back to the numbers…]
Posted by: Jordan at July 16, 2007 7:02 AM
while I certainly don't dispute the numbers, I find it interesting that I see more and more for sale signs in the neighborhoods I travel through regularly and they seem to be sitting rather long, yet the inventory levels seem to be lower then last year.
but I get this disconnected feeling, that the numbers being reported aren't jiving with something going on in the street, which is upsetting since I am basically a numbers kind of guy.
of course maybe I just don't notice the 'quick' sellers simply because they move so fast.
Posted by: badlydrawnbear at July 16, 2007 11:12 AM
It stands to reason that the inventory is low for the simple reason that homeowners are choosing to not put their homes on the market right now. Faced with the constant drumbeat of negative news about real estate, they choose to just stay put for the time being. That, in turn, results in a smaller inventory and may be one of the factors helping to prop up the median price.
Posted by: zzzzzzz at July 16, 2007 11:18 AM
Totally agreed with you. Every now and again I spend a Saturday attending any open houses I may run across. From my observations, I think there's a lot of "suppressed inventory" out there, for lack of a better term.
This is purely my theory, but it seems properties will go on the market at peak pricing (i.e. early '06 levels). Some may sell - trophy properties, stellar remodels, etc. For the rest, when there are no bites, or maybe some low-ball offers, the people pull the property to wait the market out, only to relist a month later. I think the on/off the market games are understating listed inventory.
Some may be able to hold on indefinitely and will wait until they get their wishing price. Others, prompted by their mortgages adjusting, will have to take what the market offers eventually. But right now it looks like a classic stand-off to me.
Posted by: Dude at July 16, 2007 11:26 AM
If you look for something, you will find it. If you believe that homes are staying on the market longer, you will notice the "For Sale" signs that bear this out. The mind creates theories to explain what we see, but these theories also shape what we notice and remember.
That's why anecdotal evidence is so often wrong, and why data derived from sound methods is so important.
Posted by: Dan at July 16, 2007 11:33 AM
Studio condos seem to be getting snapped up pretty quickly (just judging by new listing in the paper one weekend and gone the next weekend) at my building - Baycrest Towers in Rincon Hill. Are landlords frothing at the mouth about the potential higher rents they'll be able to charge soon (or maybe just corporate housing premiums)?
Posted by: Jamie at July 16, 2007 11:46 AM
Dan 11:33 ... I totally agree and have tried to take that into consideration.
But with the increasing number of for sales signs that I see in the areas I visit regularly and the amount of time they seem to be sitting I just get the feeling there is some kind of shadow inventory going on.
Possibly it is part of that 'bifurcated' market Data Quick mentioned or possibly it is just human nature.
Regardless I will be watching the data carefully.
Posted by: badlydrawnbear at July 16, 2007 11:49 AM
been looking at SFR's in nicer neighborhoods (Forest Hill, West Portal, Ingleside Terrace, Miraloma, etc.) and I can say inventory is low in these areas. I've been looking at listings since late last year and it jibes with these numbers.
I do anecdotally notice that in others neighborhoods (the condo dense part of Diamond Hts, south of 280, ingleside proper) inventory seems to linger and bunch up.
Don't know how this shades these overall numbers but just a glimpse from my view.
Posted by: hergle at July 16, 2007 11:56 AM
Would be interesting to see if we could get this info. by district.
Posted by: anon at July 16, 2007 1:22 PM
Does anyone know the total number of sfrs/condos/tics for San Francisco? I am just curious as to the percentage of total units that the inventory graph represents. Obvioulsy this number is slowly growing as the new condo projects come on line, but a ballpark estimate or guess will do. Thanks
Posted by: anon at July 16, 2007 1:26 PM
Lower inventories, and yet I've still been outbid on two condos by about 15% above asking in the last 4 months. Typical supply and demand curves don't apply when you are dealing with restrictive zoning/condo conversion rules and rent control.
Posted by: TJ at July 16, 2007 1:58 PM
In the long run buying in SF is an incredible proposition. The California Department of Finance just predicted the state's population would grow by over 500k people per year for the next 43 years (until 2050). That means stunning traffic jams and commute times for those who are driving into SF. If the average daily commute goes from 1.5 hours to 3 hours, pricing of centrally located real estate will skyocket. Makes me never want to sell my place, even if I move elsewhere.
Posted by: AC at July 16, 2007 2:13 PM
Speaking of Miraloma, there are two houses that were not listed in the MLS that suddenly had brokerage signs on them with sold across them.
(Pocket listings?). One was listed last week with a pending status.
Posted by: samadams at July 16, 2007 2:39 PM
AC: only problem with your theory is that many (how many?) SF residents commute to the peninsula. At least the ones that can afford these prices. There are better ways to relieve that commute...
Of course, your guess is as good as mine...
Posted by: dub dub at July 16, 2007 3:30 PM
samadams, that is totally true, a lot of people chose to live in SF and commute to the peninsula, since the peninsula is not as vibrant a place to live. Maybe that will change if people chose to live closer to where they work and over time that causes restaurants, nightclubs etc to spring up in new areas on the peninsula.
Posted by: AC at July 16, 2007 3:39 PM
The cities on the peninsula (outside of a couple) are far too NIMBY to allow extra development that would accomodate more people. Allow more people in our schools?!?! More traffic on our residential streets!?!? No and no! Build more office space to force more people to commute in and to finance our schools? Of course.
Just try building something in Menlo Park or Burlingame. Just try...
Posted by: Brutus at July 16, 2007 4:29 PM
Brutus: It's harder to build on the peninsula than in SF proper? Yikes!
To socketsite: Hope all these server errors I've been getting today are from additional traffic :)
Posted by: dub dub at July 16, 2007 4:46 PM
It is harder, in general, simply because the peninsula grew up being suburban. Now that there are forces pushing for more density, the gut reaction of most cities is not a worry of "Manhattanization", but of "San Franciskization".
Just take a look at how long it has taken to get the Bay Meadows plan moving, how many times it has been downzoned, and the number of groups who have come out against it - and it isn't even that dense.
I know everyone here likes to talk about the high prices in San Francisco, but take a look at San Mateo County sometime - the prices are nearly as high (or higher) - and the amount of land is oodles more. Only there, instead of NIMBYs hiding behind affordable housing or something like that - they just come out and say, "No thanks, we're full here."
Posted by: Brutus at July 16, 2007 5:40 PM
Does anyone know if Google is still considering leasing some office space from Gap Inc. (at the Hills Bros. building I think) so that 800 or so of their 1200+ employees who are also San Francisco residents no longer need to commute to Mountain View? I haven't heard anything about it since January/February.
Posted by: Jamie at July 16, 2007 8:00 PM