Pulse of the Market

Our bi-weekly look at early trends in the San Francisco real estate market:

Total number of new listings for single family homes was down as was the percentage of those listings that went into contract within two weeks.  New listings of condos was essentially flat and then percentage that went into contract within two weeks was down slightly.

Fall Back

Just a reminder if you're staffing or planning on attending an open house this on Sunday:

Pulse of the Market

Here's the latest edition of our look at new listings that go into contract within 14 days.

We use this statistic go help confirm our own observations and anecdotal evidence about whether the market is heating up or slowing down.  It gets us much closer to the point of decision making than most other statistics, including our own, that rely on sales prices that only become available after the property closes escrow.  In a normal market the decisions about offer and acceptance are made as much as six to eight weeks before the sales price is reported.

Interest Rates and Purchasing Power

"For every 1% rise in interest rates, home prices must fall by 10% in order for you to maintain the same monthly mortgage payment. And at the end of the day, that's what matters, the monthly payment. So take advantage of low rates; they add much more buying power to your purchase than low prices."

Dave Ness of Denver's Thrive Real Estate Group

The Pulse of the Market?

We spend a lot of time looking at statistics in this business as do our clients when they're in the market either as buyers or sellers. We look for trends and hints as to where the market is heading.

The problem is most reports are way out of date in a fast moving market such as San Francisco has seen over the past few months. Statistics (including ours) that discuss sales prices, numbers of sales, median prices, days on market etc. all show the results of decisions made weeks earlier. Even in our fast paced market, most closings take 30 days or more after the decision to make an offer was made. ("Days on Market" only takes into account the number of days between listing date and pending status.)

Most sales reports are done on a monthly basis including ours which is just posted over on our web site boldsf.com.

We wait until the second week of the month to pull together our numbers since many brokerages and agents aren't always as prompt as they should be in updating information in the MLS.  So, by the time monthly reports are posted, they represent decisions made as much as 30-60 days earlier.

We get more timely anecdotal reports from our colleagues informally and at our regular sales meetings.  And occasionally other brokerages report some of their findings (see Redfin's post on bidding wars in various markets including San Francisco).

We've found what we think may be a more current and reliable indicator of the "heat" for our specific market.  Our MLS publishes a hot sheet of new listings that covers the 14 days prior to the report.  It also shows how many of those listings are already in contract.  Take a look and let us know if you find this useful.  As you can see we've only started collecting data so it's a bit early to be drawing major conclusions.

But this apparent trend of a slight cooling off in both single family homes and especially condos is consistent with our own recent market experience.