Market Watch - annual trends continue

New listings continue to increase as is typical this time of year.  During the last two weeks there were 291 new listings (129 single family homes and 162 condos) which compares 245 (93 and 162) in the prior two week period and 277 (117 and 160) for the same period a year ago.

There was a considerably higher percent of those new listings which went into contract during that last two weeks (11% of single family homes and 15% of condos) compared to a year ago (3.4% and 2.5%).

The number of price reductions are about the same (10 single family homes and 28 condos) as they were a year ago (12 and 28) as well as the previous two week period (8 and 27).

Decline in Residential Sales?

Total residential sales (single family homes, condos, TICs, co-ops) in San Francisco as reported by the MLS declined in 2016, the third consecutive year of such declines.

The percentage reduction from the peak of the recovery in 2013 to 2016 is about 16%.  From the height of the real estate market just before the mortgage meltdown and subsequent recession the drop was more than 25%.

Since we haven't had a financial collapse recently we need to look for other reasons to understand the decline.  In no particular order here are some possible explanations:

1. The pent up demand from the recession has worked its way through the market;
2. There is a large number of new construction condos that have come on the market in the last several years.  (Most new construction condos do not appear in the MLS and are not included in the sales totals above).