March 31, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 3/31/08
The inventory of Active listed single-family homes, condos, and TICs in San Francisco increased slightly (1%) over the past two weeks and is currently running 43% higher on a year-over-year basis. And the percentage of Active listings that have been reduced at least once has increased from 21% to 29% (195 versus 384) on a year-over-year basis as well.
Keep in mind that our listed inventory counts do not include listings in any stage of contract (even those which are simply contingent) nor do they include multi-family listings (unless the units are individually listed). And once again, reports of decreasing inventories in San Francisco proper are either incorrect or possibly refer to a decrease from the levels of last October which would not reflect the market’s seasonality.
First Published: March 31, 2008 9:15 AM
Comments from "Plugged In" Readers
My prediction is listings will hit a peak of at least 2200 units this year. Lots of inventory.
Posted by: cooper at March 31, 2008 9:46 AM
My prediction is that by the year 2021 we may or may not see a large shift in volume and/or median.
Posted by: fluj at March 31, 2008 10:19 AM
I'm quite sure we'll continue to debate over the significance, if any, of median prices for those listings that actually sold, the most oft-cited number by the real estate industry.
One thing I do see from analyses of listings (rather than sales) is that medians for SFRs have ticked up in SF in recent weeks, but the $/sf continues the downward path it's been on since about April 2007. It's now at $531/sf (according to Altos), the lowest in at least two years, as far as I can tell from the charts. So we seem to be now seeing more bigger and nicer houses entering the mix but at lower prices/sf than in the past. Interestingly, and perhaps contrary to conventional wisdom, condo listing $/sf are holding steady at about $700/sf.
Posted by: Trip at March 31, 2008 10:28 AM
I've only lived here 8 years, but I've never seen this much inventory. I also don't see many properties going into contract.
Posted by: sleepiguy at March 31, 2008 11:00 AM
sleepiguy, I study the MLS every day for at least an hour or so. Often longer if I'm trying to figure something out in particulary, and I have been seeing a healthy amount of properties getting into contract. There are currently 255 SFRs in contingent or pending status, 408 condos, 80 2-4 units, and 30 5+ units.
That's early 800 properties, more than I thought, actually. Of course they won't all close. But this got me a little more interested in current dynamics. Of active listings there are 532 SFRS, 792 condos, 176 2-4 units, and 71 5+. On down the line that is a 2-1 ratio, nearly. Two active in each category for each tentatively sold property. Does that seem out of whack? I think it seems pretty normal .... in a more balanced market anyway. It was probably trending toward 1:1 a few yeard ago. I doubt it ever got to 1:1. There are always lemons.
Posted by: fluj at March 31, 2008 11:19 AM
Fluj, I dont care how long you stare at this data or the MLS, this much inventory this early is not bullish. You can play around with medians and averages to get mix issues but a 43% increase inventory numbers are bad no matter the mix.
Unless you are one of the bouncers that goes it to get people out of foreclosed homes. Then its like boom times.
Posted by: cooper at March 31, 2008 11:36 AM
Can these stats be broken down by condos vs. single family homes? I'm curious to see if the increases are primarily in condos or across the board.
[Editor's Note: Single-family inventory is up 38.9% while condo inventory is up 45.5%. Number of listings for single-family homes which have been reduced is up 163% versus 61% for condos.]
Posted by: mike at March 31, 2008 11:45 AM
Of course volume is down from a few years ago. We sort of tend to think of everything in terms of peaks and valleys. I just showed what the MLS has today for SF, in contract versus active. Characterize it however you wish.
Posted by: fluj at March 31, 2008 11:58 AM
"Interestingly, and perhaps contrary to conventional wisdom, condo listing $/sf are holding steady at about $700/sf."
Thanks for your perspective/observation. As an S.F. condo owner I have no illusions that prices are immume to downturns. However, you highlight the fact [contrary to many 'experts' on Socketsite] that even in a local market that has experienced downturns overall [ranging anywhere from the last 2 years to the last 6 months] there are still certain segments of the market that have and will hold up better than others.
Posted by: Recent ORH buyer at March 31, 2008 12:09 PM
Listings are up by 43% and sales are down by 30%. That is very stark evidence of the downturn, and you really can't spin that any other way. Of course not every market segment or neighborhood has been affected equally. But these are city-wide numbers, and in a market this small nothing is going to escape this trend -- although I agree that some segments will be hit harder than others.
Posted by: Trip at March 31, 2008 12:19 PM
downturn is starting to appear in the higher end areas of the east bay
smacking my lips, rubbing my hands together
Posted by: mrbogue at March 31, 2008 12:30 PM
Something I am seeing in markets outside of the city - a la Sacramento; stablization. If you noticed DOM are reducing for the less expensive properties - thats a good sign in my book, plus quality homes at good prices are not flying of the market but the last 4 homes we had clients put in offers for just went PENDING. By no means am I saying anything other then - If I stretch my big tow as if I was strecthing to go to bed - I can almost touch the bottom. My big question to everyone is - what's up with Stinson Beach? Anyone see the $2500 / sq ft'ers coming back to earth a bit?
Posted by: Michael L. at March 31, 2008 1:59 PM
DOM is meaningless - it gets reset every time a property is relisted. it's about as reliable an indicator of the bottom as your anecdote about 4 houses going pending.
Posted by: trevortrevorson at March 31, 2008 2:55 PM
DOM meaningless? If you look the PROPERT HISTORY you simply add up all the days. The reset days give the PUBLIC the appearance that the listing is fresh - check out the MLS prospector MLS; you will see that each time the DOM is reset the initial DOM are tabulated elsewhere. Don't look up the AGENT RELIST info - look at the PROPERTY INFO
Posted by: Michael L. at March 31, 2008 3:01 PM
Stabilization in Sacramento? Count me sceptical on that one given that inventory is higher now than at this time last year despite a 20%+ drop in the median price.
Posted by: Amen Corner at March 31, 2008 3:06 PM
Cooper was that estimate of 2200 by nay chance done by taking the highest point last year (1532) times the current YOY increase (43%?).
will be interesting to watch though. Theres definitley some better news coming through though, with the increase in sales and the YOY inventory increase lower then it was last month.
Posted by: REpornaddict at March 31, 2008 3:11 PM
"The reset days give the PUBLIC the appearance that the listing is fresh"
so you are saying that the NAR deliberately deceive the public? preposterous. why, their very code of ethics specifies this:
"The term REALTOR® has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal. "
Posted by: trevortrevorson at March 31, 2008 3:26 PM
REALTORS® shall avoid exaggeration, misrepresentation, or concealment of pertinent facts relating to the property or the transaction"
like how long the house has been on the market?
back on topic - the 30% of listings that have had price reductions - does that include relistings at lower prices?
Posted by: trevortrevorson at March 31, 2008 3:41 PM
Interesting posts Trevor on realtors. But that is their own code of conduct isn't it? or is that from some kind of sales. i.e. i don't think you can hold them legally accountable based on that. I agree though that playing with the MLS data is at attempt to conceal facts.
I actually think realtors are a bit down the food chain in terms of blame here. #1 is the investment banks, #2 is the Mortgage companies who came up with all these weird loands then you can look to the appraisers/realtors. But I'd say 70% of it is the investment bankers, and I have a lot more investment banker friends than I do realtors.
It was really the banks that created all these products and leverage so bankers could get big fat bonsues. They tried to put a whole bunch of crud together to make it "safe" so people could borrow against it and lever it up and up. that's what allowed all this money to be plowed into real estate. For some reason most of this is only in 4-5 states...California and Florida being the worst. Not sure why that is.
Posted by: cooper at March 31, 2008 3:59 PM
quotes are from the REALTOR(R) 'code of ethics'
obviously not legally accountable.
or, it seems, to be taken particularly seriously.
i know it's not the realtors fault.
bankers/realtors/greedy homeowners/crooked appraisers/horatio algers/ you can point the finger at any and all of them.
it's going to be an interesting year.
Posted by: trevortrevorson at March 31, 2008 4:13 PM
"And once again, reports of decreasing inventories in San Francisco proper are either incorrect or possibly refer to a decrease from the levels of last October which would not reflect the market’s seasonality."
I don't think this is necessarily the case. if you look at sfr, there are 259 houses in districts 3&10 for sale, and only 272 houses across the rest of the city combined. i would posit that there is a growing amount of inventory in parts of the market - sfr in less desirable neighborhoods and a glut of 1 & 2 br condos in soma that are driving the top-line inventory numbers up considerably.
if you're not looking in those pieces of the market, inventory is tight. there are 3 sfr listings in all of the haight / cole valley / ashbury heights area. a big top-line inventory number doesn't change the inventory reality for a buyers if you're not willing to look at soma condos or a house in bayview.
Posted by: decreasing inventory at March 31, 2008 4:55 PM
"Theres definitley some better news coming through though, with the increase in sales and the YOY inventory increase lower then it was last month."
I'm trying to be as objective as possible here -
I don't think anyone can gleam that this is "better" news. 2 reasons - 1) it's still on the same trend line from the beginning of the year and 2) I would argue this is what needs to happen, so my "good" scenario (which is being played out) is what you would refer to as "bad". Ultimately neither is good or bad though. It is what it is.
What you're seeing here is a real depiction of supply going up. Assuming the source of the data is accurate, I don't see how any rational person can say that supply isn't going up (I know you didn't claim that). Even if supply is increasing at a decreasing rate, it is still increasing. But as I stated in the previous paragraph, it's still increasing at the rate the year began - it could just be that February was an aberration on the "too quick" side, instead of March being on the "slowing down" side. And besides, Jan-Feb has been increasing faster than the previous 2 years' (see chart). Add in March, and that's still the case. Year to date we have seen a steeper slope on increases in inventory vs. the previous 2 years.
Now the real question becomes - what is happening on the Demand side? We know Supply is going up. Is Demand going up to compensate for that - to keep prices stable? If not, then you can forget about the "micro-climates" of SF, and the "special neighborhoods", etc. It's going to get clobbered. Quite frankly, I'm shocked it hasn't happened yet. It will though. SF is special, but it still adheres to economic fundamentals in the long term.
I would also argue that even if SF gets to 2004 prices, it's still in a bubble. Strap in - we've got a long way to go. I am making the prediction that when the year ends, we will not have seen the current year's chart fall below any of the previous 2 years' at any point in time. It won't even be close. I realize that we all believe what we want to believe, and I have not swayed you though.
Posted by: Treeman at March 31, 2008 4:55 PM
Agree Treeman. There is no way any of this data can be skewed as bullish. There are a couple of posters that are trying however. The best analogy is a tech stock in 2001...there were analysts who argued the whole way down that it was a buying opportunity and quality names would thrive in tech. Very few did.
Posted by: cooper at March 31, 2008 5:33 PM
downturn is starting to appear in the higher end areas of the east bay
Are we talkin' BAP (Berkeley, Albany, Piedmont)? Spit it out, man -- what are you seeing?!
Posted by: EBGuy at March 31, 2008 5:34 PM
Michael you said:
"you will see that each time the DOM is reset the initial DOM are tabulated elsewhere. Don't look up the AGENT RELIST info - look at the PROPERTY INFO"
I've noticed properties being relisted and wondered about how to know *real* time on market. HOw do I get that Agent relist info on the MLS?
Posted by: Melinda at March 31, 2008 5:42 PM
On the internet - you don't. You ask your realtor for the information on a specific property you're interested in. It's part of their 3% value add.
Posted by: Treeman at March 31, 2008 5:56 PM
"You ask your realtor for the information on a specific property you're interested in. It's part of their 3% value add."
Thanks goodness for realtors then. Oh, wait...
Posted by: Amen Corner at March 31, 2008 7:10 PM
I'm not sure that this re-listing practice is all that common. It can reset the DOM clock - but, as others have noted, the full data is still available on the MLS (to those with access of course - and provided that the original listing is not deleted). It does seem like a pretty ridiculous thing to do. If the seller has truly changed his/her mind, fine, but if the intent is solely to mess with the DOM, then it is a questionable practice. I'll try to do some analysis on how prevalent this is. My sense is that this tactic is used more often in the slower markets. Our DOM's must be really pretty short by current national standards.
Posted by: FSBO at March 31, 2008 7:18 PM
If something takes six months to sell, is DOM really relevant at all? Even if the property has been "manipulated" a few times? Because that's what the rest of the country is experiencing. We don't hear about "DOM manipulation" in truly down markets. Nor do we have people chiming in on how refreshing it is to see a new sort of staging decor. Take a step back for a moment, folks.
Posted by: fluj at April 1, 2008 9:57 AM
fluj - an accurate DOM might be valuable to the buyer in certain (but not all) situations. I have heard of DOM manipulation in Phoenix and FL markets. What's the difference between a DOM of 180 days and one of, say, 360 days? If I were the buyer, I would certainly use attempt to use that information. I know of a house in NE Florida that has been on the market for over 1,000 days. It's DOM has been reset several times and now shows 135 days. Would potential buyers adjust their strategy based on this knowledge? Are their realtors telling them about the true DOM?
Posted by: FSBO at April 1, 2008 10:10 AM
OK FSBO. I take your point and it is valid if very, very micro. However, on the other hand, stubborn people are stubborn people. One hundred thirty five days or 500 days ... most potential buyers can look at that and say "Hmm. This person wants this price, or close to it, or nothing doing." And by the way, the buyer's (selling agent) is of course telling the would-be buyer about the true DOM. If not he/she isn't worth a grain of salt. Your concern is with the listing agent there.
Posted by: fluj at April 1, 2008 10:28 AM
I just took a look at the March listed sales data. It's preliminary as additional March reportings will continue to be made - but here are the March data for SFH's and condos in San Francisco compared with other relevant months:
Total Listed Sales (SFH + Condo)
Mar08: 281 (reported as of Apr 1)
Median Price (SFH + Condo)
May07: $839.5K (all-time high)
Median Price (SFH)
Mar08: $912.8K (128 sales as of Apr 1)
Mar07: $880.0K (205 sales)
May07: $965.0K (233 sales)
Feb08: $828.5K (138 sales)
Median Price (condo)
Mar08: $769.0K (153 sales as of Apr 1)
Mar07: $710.0K (289 sales)
May07: $765.0K (325 sales)
Feb08: $755.0K (163 sales)
Mean Price Per SF (SFH)
Mean Price Per SF (condo)
The median DOM for March was 32 - so probably not much manipulation there. I'm going to look closer by district. I was surprised by this price jump - big change from just a month ago. I think that district and square footage will explain some of the increase.
Posted by: FSBO at April 1, 2008 10:32 AM
Chiming in with my $0.02 on the DOM issue...seen a fair number of places withdraw and relist things in the last 3-6 months. In one instance, right after the withdrawal and re-list (the next day), the place went into escrow clear of all contingencies.
Not sure what impact this has on DOM, but certainly sounds fishy to me...
Posted by: Foolio at April 1, 2008 11:06 AM
One hundred thirty five days or 500 days ... most potential buyers can look at that and say "Hmm. This person wants this price, or close to it, or nothing doing."
Personally as a potential buyer, i would interpret that very differently. If someone had a house on the market that long, i wouldn't infer that they are really demanding that price point. i would infer that they are not selling something they want to sell and i would certainly lowball their current listing price.
Posted by: Spencer at April 1, 2008 12:51 PM
Spencer they might could go for it if you were also armed with a supersweet printout of a Case Shiller graph in your cover letter. Nothing ventured, nothing gained!
Posted by: fluj at April 1, 2008 1:25 PM
Fluj said "Spencer they might could go for it if you were also armed with a supersweet printout of a Case Shiller graph in your cover letter. Nothing ventured, nothing gained!"
You keep bringing this idea for a cover letter as some kind of humor attempt, as if prices were not dropping like a rock right now. Inventory was up 43% in March, we don't need a stinking cover letter.
Posted by: cooper at April 1, 2008 3:25 PM
Your point made no sense. If sellers wish to sell, above all, they will lower their price. You chose to argue with me for argument's sake, so I let you have it. If you didn't think it funny, well, that's just another example of you and I not seeing eye to eye on anything.
Go ahead and think that properties are selling for lowball type offers in this market if you wish.
Posted by: fluj at April 1, 2008 4:11 PM
Funny how things turn around and around...
First: US housing will never go down. There is no new land but only new people. Homes are going like hot cakes within few DOM.
Next: It can only happen to oldies in Florida and Arizona. Everyone loves sunshine state...
Next: It will only happen to Sacramento(because of Terminator), Stockton, Merced. Bay area has lots of jobs and so completely immune
Next: It can only happen to east bay, not the city. There are more foreigners buying property in city.
Next: It only happens to bayview, vistacion..
Next: Only to south slope of potrero ( Don't tell me there is no difference between south and north slopes..) and SOMA ( because of new condos)
Next: DOM doesn't matter.(Many would have heard realtors saying homes will get sold in days. What is DOM then???)
Future: who knows... 1010 st went down, not 1008 ( everyone loves number 8)....
Posted by: SFwatcher at April 1, 2008 6:14 PM
Posted by: Spencer at April 2, 2008 2:06 PM
sort of funny. a few stretches such as bulls are the ones saying DOM doesn't matter? Or bears? Or both? And you know what else? houses are still selling in areas 10, 25 in the last month at $479 a foot, somewhere in between 2004 and 2005 level pricing. This is supposed to be the decimated area. Twenty five sales last month. Do you think Stockton saw 25 sales this month?
Posted by: fluj at April 2, 2008 3:13 PM
"Do you think Stockton saw 25 sales this month?"
Not sure of the point of this question, but to answer it, "No, I don't".
According to DQ, Stockton in February 2008 saw 233 sales, just about TEN TIMES THE NUMBER SOLD IN DISTRICT 10 of SF. (I can't see the March numbers yet, but I bet they'll be at least 233 sales because of the positive seasonality effects as we go from winter to spring.)
I'd also bet ONE MEEEEEELIIION DOLLARS (hehehe) that that $479 psf figure in District 10 is phony. The psf scam of course is alive and well in SF, but it is a little frustrating when regular hobbyists (like me) can't get access to the data that are controlled by the realtors. But just to give you a clue that $479 ON AVERAGE in District 10 is a fantasy, you can look at nice, large SFHs in the nicer parts of District 4 and District 3 have sold for LESS on a psf basis. For instance, 215 Westgate, a 5/4 view home, 3457 square feet just sold for $441 psf (and it took them about 6 months to sell it), and even fluj's favorite "hot" District 3 area - Merced Manor - recently had a sale at $450 psf (2750 Ocean - 3,000 square feet with 1000 square feet expansion potential). Of course, large properties will of course often have lower psf selling prices (until of course you get into the true "luxury" properties where price is not an object), but even for small properties getting more than $450-500 psf in nice parts of District 4 is no longer a slam dunk. My favorite foreclosure - for example - in Sunnyside has been languishing for months at less than $300 psf - www.foerstersf.com. Now it's offered at $539,000, down 30% from its last sale price at $770,000! That's about $270 psf. As no one is jumping on that, or bidding nice properties in District 4 much over $500-600 psf, let's just say I'm VERY skeptical that that $479 figure is accurate.
Posted by: Satchel at April 2, 2008 5:02 PM
fluj - interesting point. District 10 is down in volume and less so in price. Median price for Mar08 was down about 20% from Mar07 - but average per sf declined from $502 only to $479 as you pointed out. I agree - down, but not decimated.
But I had to take a closer look at Stockton. Wow, talk about cliff diving (for prices, volume was actually up YOY). Here are the data for the city of Stockton:
median price: $225K
ave price/sf: $128
median price: $330K
ave price/sf: $219
So sales were actually up last month - probably due to this price cutting. $128 per sf! Volume is down from the 05-06 levels. 18 houses went for under $100K. You could have bought the most expensive sale with the commission check from 34 Presidio Terrace.
Posted by: FSBO at April 2, 2008 5:23 PM
Satchel - of the 25 District 10 sales, 23 reported square footage. The median price per sf is, incredibly, $479 - almost exactly the mean. There were 8 sales in the $540 - 650 psf range in Portola (and perhaps the nicer subdistricts of 10). On the bottom end, there were 5 sales at $400 psf or less with the lowest at just $229. The range of square footage was from 756 to 1,999.
The prices do seem high for this district. (Feb08 average was $444.) But 25 buyers stepped up and paid them. Don't know much about Stockton, but your $/sf goes a lot further.
Posted by: FSBO at April 2, 2008 5:44 PM
The highest $/sf sale in District 10 last month was 780 Goettingen Street in the Portola subdistrict just north of Mansell Street. It came in at $649.47 per sf. It was a 2BR/1BA REO foreclosure and sold for $491K with a listed square footage of 756. States that there is unwarranted room off the enclosed garage. Obviously not including those sq feet - but 2nd floor does look bigger than 756sf. Last sold for $669K in Dec 06.
Posted by: FSBO at April 2, 2008 6:03 PM
Thanks for the data! No quarrel from me - I'm sure that the data does show $479 psf. However, there is ZERO chance IMO that that figure accurately describes reality. The housing stock in SF is old, there have been numerous unwarranted additions, etc. In essence, you can't trust the data, and there is no attempt to make it accurate.
Of course 780 Goettingen is larger than 754 square feet. How much more? Who knows, but I guess it's at least TWICE as large. But as you point out, its $649 psf was in the data. It last sold (prior to the foreclosure sale) in 2006 for $669,000, or $890 psf! Was that $890 figure in the data? Who knows? (I guess the realtors do, but NOT the buyers.)
The 414 Foerster foreclosure is an interesting case in point. I have been inside of it and chatted with the realtor. That house is listed as something like 1000 square feet, but it's at least 1900, perhaps even 2000 (4 bedrooms and 2 baths, and even a little laundry room is hard to cram into 1000 square feet!). So, depending on what figure you use, the house is languishing at $500 psf or $270 psf!!
The 215 Westgate property I mentioned is also interesting. I don't know whether it's "true" $/psf selling price will get into the data or it;s "phony" one. All I know is that the Chronicle listed it sold at $1.525M at 1802 square feet. That's $846 psf.
But of course, that was a 3,457 square foot house (large addition in the early 1980s I think that doubled the size of the house), which the listing realtor was all too proud to list:
Using the correct square footage (I've been in the house and 3,457 is likely accurate), the selling price was $441 psf.
Now, I don't know which figure gets into the stats, and I wouldn't be surprised if it's somewhat random. But these problems highlight why people really need to understand how "mix" and "beauty pageant" effects are likely to influence the data.
About Stockton, the housing stock is much newer. It is also less heterogeneous than the stock in SF (smaller standard deviation, I bet more normal-looking "tails" on the value distribution) and the recorded tax data is much more likely to be accurate, if only because the newer vintage of the housing stock means that there has been less time for substantial upgrades, additions, etc.
But Stockton highlights what I think a bottom would start to look like, although I think it is too early to say for sure with Stockton just yet. I would guess that increasing sales volumes that are sustained (on a yoy basis) for 4-6 months, COMBINED with stable or slightly falling medians (on a mom basis) is probably a sign that the market in question is in a bottoming process. I wish I had more access to SF data, but in truth it's pretty obvious to me that SF is still in the early stages of its decline process and that the "bottom" or "bottoming process" is not yet in sight.
Posted by: Satchel at April 2, 2008 6:43 PM
I think Stockton will continue to drop too - but some of their "higher end" sales in the $500 - $600K range looked pretty good. 4,000 sq feet, new construction, gated golf course community, decent looking finishes, all for $125 psf. Contrast that with what you get (and where you are living) for the same total dollar outlay in District 10 - 1,000 sf in a high crime area. Yeah, I think we have a ways to drop here too.
Posted by: FSBO at April 2, 2008 7:17 PM
Sorry about the incorrect link in my above post regarding 215 Westgate (in relation to the idea that you can't take the $psf figures too seriously).
Here is the correct listing link that shows that the house is 3,457 square feet, not the 1,802 square feet that the Chronicle lists:
@FSBO - I'm curious - do the MLS stats for this month show the 1,802 square feet, or the #3,547, or is it "not reported"?
Posted by: Satchel at April 2, 2008 7:24 PM
Satchel - 215 Westgate sale shows 3,457 sf for $1.525M and $441.13 per sf. Looks like a lot of house for $441 psf (and a garage floor you could almost eat off) - a whole lot better value than anything in Dist 10.
The overall average psf for SFH's for March was $635. A 30% decline would bring us right to this $440 psf (back around to 2000-01 levels).
Posted by: FSBO at April 2, 2008 8:02 PM
Yeah Satchel. Mix works in both good and bad neighborhoods. So what? The 25 SFR sales in March in 10 was what was surprising, really. That is way more than I expected. I only looked at it today because over the last few weeks I had noticed a bunch of 10s cropping up in the sales area.
Posted by: fluj at April 2, 2008 9:02 PM