| Dear Clients, Colleagues, and Friends of Team Hatvany, Happy Fall! Summer went by in a quick flash but it was a slower summer for the real estate market, particularly in July and August. Now everyone is back in town, back to school, and ready to buy and sell real estate! September/October (post-Labor Day to Halloween) is our second-biggest selling season, after the spring market. September is typically the single month that sees the highest number of new listings coming on the market, and this year is no exception. From SOMA studios to Pacific Heights mansions, every price point and property type is suddenly available. Every year we see the same pattern: buyers freeze up because they are confused by how many properties are available. After a slow summer, it seems like there will be a new listing every weekend (or five) and buyers don’t want to overspend or commit to a property when a better one may be around the corner. Beware of this mistake! Most Fall properties are on the market by the end of September, with some more coming in October, but the bulk of inventory by late-September. Buyers who wait until mid-October to make offers and final decisions will find themselves with depleted inventory and all the ‘good’ inventory snapped up. By Halloween, the market tends to slow dramatically and new inventory grinds to a halt in anticipation of the holidays and our winter rainy season. So – our advice is, if you like something, make a move! There very well may not be anything better coming around the corner; hindsight is 20-20 after you miss out but our job is to give you our best insight and foresight. In addition, our advice to buyers is to be prepared to make buying a home your second job during the remaining weeks of September and early October. We recommend seeing properties right when they come on, because coupled with the waves of new inventory is an increasingly hurried pace – things move FAST in the Fall. Offer dates tend to be within 5-9 days instead of 10-14 days, and the earlier you can get into see a place, the more time you will have to review disclosures, get contractors in and special inspections completed, and do all the diligence you might want to do if you had the ultimate luxury: time! On the sell side, despite the amazing amount of press about AI-money and buyers flooding the market, we haven’t actually found this to be true. There are definitely some AI buyers out there, but most of them don’t have the capital ready to deploy yet on a purchase and would rather rent to see whether their companies take off, wait for their financials to become more liquid, and make final decisions about settling in San Francisco long-term. What we are seeing is an incredible surge in San Francisco rental rates, going up over 10% since last year with lines of tenants competing for good properties – from $2000/month studios to $35,000/month single-family Paciifc Heights homes. We believe this is fueled by both AI jobs as well as changing work-from-home policies across tech companies, driving those who went across the bridge or further afield to work remotely to need a landing pad for full time work in San Francisco for the time being. Sales over $10M have stalled a bit again – the buyers are out there, but they are increasingly more selective and wary of things like high insurance premiums and work needed. Contractors are quoting astronomical renovation prices per square foot, making buyers increasingly reliant on actual estimates before submitting a bid on a property that needs renovation. The boom loop in San Francisco is definitely real, and we are seeing a resurgence of activity and foot traffic across the city, with commercial buyers snapping up office and retail properties at deep discounts, demonstrating the confidence in San Francisco’s revitalization. Tourism and visitor numbers are back up to pre-pandemic levels, but not international tourists, which may be driven by the current political climate. Crime is down across the board, and we are hopefully that Mayor Lurie will make good on his promises to add more housing and streamline the long-dreaded permitting process, although that remains to be seen! The market data slides are linked below for this month’s Market Report. Unfortunately the data is not exciting this go-round because it reflects everything through August, when the market was very flat year-over-year, and now our market has picked up again! The summer’s market showed no dramatic shifts beyond traditional seasonal changes. Overbidding continues to be a strong trend in the market since this spring, and that goes hand in hand with underpricing. Listings that are underpriced are having much more success and competition than transparently priced or overpriced listings, as has been the case this past spring and summer. The more we see underpricing and overbids, the more buyers get conditioned to that strategy and tend not to look at places that are priced higher for fear they will go way over asking. Days on Market in July and August ticked up a bit year over year, as the second half of summer was especially slow for listings and it seemed like a lot of people were out of town, escaping the gloomy weather. Now that fall Is upon us, we are bringing on a whole lot of new listings this month – like everyone else! This week, we launched 2945 Pacific #9, an elegant 1-bedroom Pacific Heights condominium, 3928-30 Sacramento, an 2-unit fixer in Presidio Heights, and 25 Gambier, an adorable single family home in Portola. Next week we are bringing to market 4421 19th, a delightful Victorian home in Eureka Valley, 1013 Rhode Island, a Potrero Hill view home with an enchanting garden, and last but definitely not least, a 2833 Vallejo Street, a large Pacific Heights modern mansion with spectacular views. The Compass Market Report slides on a flipbook can be found here. Please visit www.teamhatvany.com to learn more about any of these listings. And please be in touch; we are never too busy for our clients or for your referrals! Best, Team HatvanyNina, Natalie, Vanessa & Paul |
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