What a difference a year makes in the San Francisco real
estate market. 2021 was the best year
for total closed sales since 2004, including the fourth quarter. The fourth quarter usually vies with the
first quarter in a typical year for the fewest sales. Yet in 2021 it turned out to be the second best
quarter after our second quarter spring market.
The 2022 fourth quarter has started out very slowly. The single family home segment is still
showing demand but rising interest rates are affecting even that portion of the
market with moderating final selling prices, disappearing offer dates, and
fewer buyers overall.
The condo/TIC segment has seen an almost 25% drop in closed
sales compared to 2021 with falling average selling prices, increasing days on
market, price reductions, and withdrawals.
Available inventory remains almost three months. Most of us would call this a “buyer’s market”
which hasn’t been part of our vocabulary since 2010.
Single family homes average selling prices remain at
historic highs for properties priced below $2.5 million, but there are signs of
downward moderation. For the 1/1, 2/1,
and 2/2 condos we survey average selling prices are down by 6%, 2%, and 3%
compared to previous historic highs established in 2019.
The numbers indicate a slowdown is here. Sellers are slowly adjusting to that
realization.
