According to Redfin’s market report for May, sales volume of single-family homes and condominiums in San Francisco was up 22.8 percent on a year-over-year basis (549 transactions in May 2010 versus 447 transactions in May 2009), up 20.9 percent versus this past April (454).
Sales volume for San Francisco single-family homes this past May (258) was up 18.3 percent versus May 2009 (218), up 14.7 percent versus this past April (225). Sales volume for condominiums was up 27.1 percent on a year-over-year basis (229 in May 2009 versus 291 in May 2010), down 27.1 percent versus this past April (229).
Sales volume for the greater Bay Area was up 3 percent on a year-over-year basis in May, up 8 percent month-over-month.
Redfin’s monthly market report draws from both Multiple Listing Services and government records, and as such should reflect both listed and unlisted transactions. In terms of inventory, keep in mind that Redfin includes listings which are in contract but contingent, an approach we don’t agree with and don’t do in our counts.
∙ Redfin Reports: April Sales Volume For San Francisco Up 10% YOY [SocketSite]
∙ Bay Area May Market Report: Prices Increase 9.9% in May, Funk Coming [Redfin]
∙ SocketSite’s San Francisco Listed Housing Inventory: 6/14/10 [SocketSite]
So, in the inventory thread from yesterday, we can see a trend in sales vs last year coinciding with inventory that is trending higher and higher than last year:
Jan 1 – May 31: sales up about 42%, vs inventory down 10%
Mar 1 – June 10: sales up about 38% vs inventory down about 7%
May 1 – May 31: sales up about 23% vs inventory flat%
So the relative sales are trending towards 2009 (42%, then 38%, then 23%), a down year, while the relative inventory has now surpassed 2009.
The trend tipster notes makes sense. The first few months of 2009 were completely dead, so it was easy to greatly surpass sales volume YOY in 2010. But the market-priming kicked in full gear in late Spring 2009 and as a result things took off (relatively speaking — still generally slow like 2008 and far below the peak years). So YOY gains were not quite so extreme. And now the tax credits are gone, the foreclosure moratoria have ended and loan mods slowed, and there has been a bit of tightening of FHA borrower standards, so YOY sales gains will be lower still and likely even turn lower than 2009 moving forward.
Rising inventory, and sales going from slow to slower. Pretty easy to see what that does to prices.
Not necessarily arguing tipster’s point.. But I think AT might be taking a bit far..
How do you get “and sales going from slow to slower” from the data that says sales increased 20.9% from April to May (454 to 549). I’m no mathmetician, but that doesn’t sound like slowing sales.
R, I was noting the slowing YOY numbers. Sales are pretty much always going to be higher in May than April due to seasonal trends.
So, um, still not sure about the “and sales going from slow to slower”.. even if you’re using YOY.
April YOY: 376 to 412, up 10%
May YOY: 447 to 549, up 23%
Look back more than one month.
I tried. Couldn’t find the data on Redfin.
What were the numbers on March?
The California tax credits started May 1. Sales were shifted from April to May by anyone who could wait.
http://blogs.wsj.com/developments/2010/03/24/californias-tax-credit-will-home-buyers-stampede-for-18000/
R’s numbers just show that without that shift from April to May, the 23% would have been something closer to 15%, so it’s even closer to 2009 than I originally thought. And without the tax credits, we’d probably have been right back in the toilet with 2009 – same inventory, same level of sales.
Tipster.. no doubt the Tax credit pushed some sales into May. How many? Who knows, but not a lot.
But I still question AT’s statement that sales are getting slower. Not sure how he can spin that with these numbers.. Unless I’m missing something.
yeah right, $8k or $10k tax credit (with the $10k spread out over 3 years) meant much of anything to a market where the avg sales price is $700k-ish
i completely agree with all tax credit arguments moving sales up in 90% of the country – but not in SF
and from what i can tell there’s been a recent uptick in buyer interest on the “low” end (sub $700k) which i believe is due to a drop in interest rates. in April buyers in this segment just seemed like they could care less about the tax credit. this is just in my little RE world – but in my office’s weekly agent meetings tax credits were rarely if ever discussed.
I’m a recent buyer. We closed on April 30.
I realize that by closing one day later, I could have had $8000 in my pocket. But $8000 per day only works out to $2.9M per year, and that’s just not enough! Especially when it would have required me to actually pick up the phone and change the closing date! The horrors!
So I agree with hangemhi, who on prior threads has also been shown to have “missed” certain information staring him in the face, getting paid at the rate of $2.9M per year is simply insignificant, and the sudden, temporary April sales closer-convergence-to-2009 was more likely caused by sunspots.
I’m confused.
What does 2.9M per year have to do with anything? Did someone buy 365 houses?
I bought a place in September of last year and to be honest, I went in misunderstanding how the tax credit worked. I mistakenly thought it was a merely a $8000 deduction and not actually a credit. I had a pleasant surprise at tax time this year.
Given what I was paying for my place and my misconception about the tax credit, it really had no bearing on when I bought. Given house prices in this area, I’d be surprised if the tax credit really matters to many buyers in SF.
March was up enormously y.o.y, something like 70+ %. Then April was only up 10 percent. Then May was up 23%. Feb was up 30 percent and Jan was up about 40 percent. So month to month 2010 is up down up down up, but it’s all yoy up.
“Given house prices in this area, I’d be surprised if the tax credit really matters to many buyers in SF.”
People say this all the time, but whether it’s true or not is a more complex question.
Given the housing prices in SF, many of the people make more than the threshold income limit, so they won’t get this credit. But that threshold is $225K with a complete phaseout at $245K, so plenty of people in Real SF and Not Real SF who are buying do qualify.
Plenty of people within the income limit for the federal tax credit were at least trying to push their sale into April if they were going to buy anyway. That’s why this credit is seen largely as pulling forward sales, rather than causing new sales. I don’t think the credits actually *caused* anyone to undergo a transaction they wouldn’t have undergone anyway. And the state tax credit of $10K has no income limit and applies for closings in May, and it was easy to sign a contract in April and close in May so you could get both credits. The point is that these sales that are pulled forward are reflected in the stats as being pulled forward, so you have to consider that fact in the stats.
Whether these people “need” the credit or not is beside the point. If they qualify and are informed, they will seek the credit to minimize tax liability. To suggest that people don’t care at all is misguided. Martha Stewart probably got in trouble over $25K in net losses when you offset her loss against her likely gains for tax purposes, so it seems odd to tell me that people who aren’t nearly as rich as her wouldn’t try to push a transaction one way or another for $18K.
It’s worth noting that this is a tax credit, and not a deduction, as somewhat recent buyer pointed out, so it’s like not paying federal income tax on $24K at a 33% marginal rate or $32K at a 25% marginal rate. For state, it’s like not paying state income tax on $107K+ if you make less than $1M/year, although it’s phased in over three years, so more like $36K/year for 3 years that are tax-free.
And, as I mentioned before, the idea in Congress to extend the closing date for the federal credit by 3 months will surely induce some fraud for people who backdate contracts to April. Even now, I’m sure that some people who technically bought in May backdated to April, and the stats apparently reflect this.