According to a plugged-in reader the early count for listed sales volume of single-family homes, condos, and TICs in San Francisco last month is currently running 18% under that of May 2007 (29% under May 2004). Expect a slight bump for late reportings.
Keep in mind that listed sales volume was down 13% on a year-over-year basis the month prior (April) while recorded sales volume was up 6.5% (think new construction closings). And listed inventory is currently up 45% year-over-year.
SocketSite’s San Francisco Listed Housing Inventory Update: 6/2/08 [SocketSite]
San Francisco Recorded Sales Activity In April: Up 6.5% YOY [SocketSite]

Comments from Plugged-In Readers

  1. Posted by Foolio

    Wow, not good.

  2. Posted by anon

    Yeah so much for the “spring bounce” that never materialized. But at least we have the “summer selling season” ahead of us.

  3. Posted by Foolio

    Sure, it’s a great time to buy…unless you’re Ed McMahon or Jose Canseco… 😉

  4. Posted by fluj

    Ed McMahon broke his neck poor guy. Canseco walked away because he has no morals.
    This time last year everybody was talkign about collapse. 315 SFR sales down to 281 (so far), with a higher average sale price and only three extra days on the market is no collapse.

  5. Posted by chuckie

    I think fluj has a point. 281 vs 315 is very robust considering what’s going on all around. I think it’s pretty amazing… and I don’t see how this type of fall in volume can lead to a huge decline in prices. We’ll have to see larger sales declines for it to translate into significant price declines.

  6. Posted by tipster

    Fall in volume plus an increase in inventory shows the market is sputtering out of steam.
    We’re running out of buyers, but the sellers keep coming, in spite of the continued attempts by some real estate sales people to keep inventory off the MLS, via pocket listings, craigslist, etc.
    It’s starting later because the loans reset later here. While fluj compares our situation to other places with sub prime problems that started in earnest late last year, I’m frankly surprised this is happening as quickly here as it is because of the different types of loans used and their different reset periods. I figured it was another year away before the market ran out of steam, but I guess it’s happening in fits and starts here already.
    Meanwhile, the housing situation nationwide is getting worse. The bankers told us the worst was behind us so that they could raise more capital for when the second wave really hit. What were they supposed to say: “we’re screwed, you shouldn’t give us any money”? But in spite of their talk, their stocks are getting hammered and head after head of a financial institution holding mortgages is getting chopped off. You can only keep up the clever accounting for so long.
    And so everyone here will see the first wave of vulture buyers, those who bought foreclosures in Sacramento and Modesto for a “song” this year and last year, who will be underwater by next year, and who themselves will walk away when the second wave hits. When the foreclosures start in earnest here, there won’t be any buyers left…

  7. Posted by Trip

    Median sales price is a nearly meaningless indicator of market trends, but average sales price is an absolutely meaningless indicator.

  8. Posted by John

    The problem is we (me included) have been saying the wolf is coming for the last two years. To tell the truth, I expected much worse market by now, and I am not sure anymore.
    Considering the hot red market in 2005 to 2007, 2008 market seems to be “normal”.
    And there was just another article on WSJ a couple of days ago about the vulture buyers of Stockton properties. Do you really think they will be underwater? They are cash positive…rent covers all the cost and more. That sounds like bottom to me, unless the job situation gets worse and rent decreases significantly.

  9. Posted by diemos

    “unless the job situation gets worse and rent decreases significantly.”
    Already baked in.

  10. Posted by Trip

    We’re nowhere near the bottom. Foreclosures are still hitting record levels. http://biz.yahoo.com/ap/080605/home_foreclosures.html And SF is about a year behind the rest of the state and the country in the downturn, so we have even farther to go. Just look at the soaring SF inventory, which preceded price declines every time in the markets already seeing the real crunch.
    This reminds me of those who bought Sun Micro at 100 in early 2001 at prices 50% less than 6 months earlier. “It’s a great company with great products, not like tech bubble fly-by-nights. It must be a bargain now.” Then it fell to about 12 and it’s been stuck around there ever since.
    I’m not saying we’re going to see anything of that magnitude and stock bubbles are very different from real estate bubbles. It’s just an illustration, but the mindset is the same. The current downturn — the worst since the Depression — hit when the economy and job markets were still strong. If those continue to slow, and there are few indications of anything but continued slowing, it is unrealistic to expect anything but further real estate declines. SF housing price fundamentals are still way out of whack. There are lots of reasons to want to buy a place, but price is not among them right now.

  11. Posted by joerealtor

    No the market is not going to crash. And there is new momentum picking up in the distressed neighborhoods of San Francisco.
    I know of several properties in area 10 – Bayview, Excelsior, and pretty much all neighborhoods south of the 280 – that have had multiple offer bidding situations. One was a short sale that supposedly got 67 offers on a sfr listed for $399K. And a regular sale of a home in Crocker Amazon that got 40 offers and went six figures over asking.
    There are absolutely buyers out there. I am working with quite a few. BUT they are not throwing money at anything, VALUE is key. At all price ranges.

  12. Posted by Dude

    Crash? Oh, pish posh. Just wait until the DataQuick numbers come out. I’m sure those guys can “find” an additional 100+ sales in May to show that sales are basically flat, or maybe even up. The worst is clearly behind us. Again.

  13. Posted by Foolio

    I used to be a buyer, but I’m now essentially out of the market.
    SFRE is like a big oil tanker. It’s gonna take awhile to turnaround. It’s much better to wait and buy after things start moving up again than to catch a falling knife.

  14. Posted by fluj

    Trip, Tipster, Diemos,
    Yesterday I showed the whole of the SFARMLS for SFRs in May.
    In SF, districts 1-10, the story was 219 sales in May this year versus 233 last year. That’s only 6%. And there aren’t even that many 10 percent down loan programs out there right now. This is pretty incredible, really.

  15. Posted by FSBO

    Here are the latest May sales data from the MLS: Total sales for San Francisco for SFH’s and condos stand at 464 with a median price of $835K (versus 558 @ $839.5K for May 2007). The table below shows the single-family home data by MLS District # for May 2008 (as currently reported) and May 2007:
    Dist 1: May08: 25 @ $1,400.0K; May07: 18 @ $1,597.5K
    Dist 2: May08: 50 @ $838.0K; May07: 48 @ $897.0K
    Dist 3: May08: 10 @ $639.5K; May07: 16 @ $813.5K
    Dist 4: May08: 26 @ $1,092.8K; May07: 36 @ $1,225.0K
    Dist 5: May08: 34 @ $1,289.5K; May07: 36 @ $1,457.5K
    Dist 6: May08: 3 @ $979.0K; May07: 5 @ $1,725.0K
    Dist 7: May08: 13 @ $3,595.0K; May07: 13 @ $4,650.0K
    Dist 8: May08: 2 @ $3,670.0K; May07: 1 @ $2,750.0K
    Dist 9: May08: 15 @ $900.0K; May07: 17 @ $835.0K
    Dist 10: May08: 41 @ $570K; May07 43 @ $722.0K
    Total SFH: May08: 219 @ $870.0K; May07: 233 @ $965.0K
    Condos: May08: 245 @ $795.0K; May07: 325 @ $765.0K
    Total Sales: May08: 464 @ $835.0K; May07: 558 @ $839.5K
    Note that every district except District 9 (and the two sales in Dist 8) shows a decline in median price compared to May 07. Condos on the other hand, while way down in volume, are up in median price.
    (Note: The data are SF sales only – fluj’s counts of 281 & 315 include San Mateo sales reported through SFARMLS.)

  16. Posted by Trip

    So median sales prices for SFRs are way, way down. I’m not going to pretend that has a lot of significance because it doesn’t. But it did not have much significance when realtors were touting the number when it was rising either.
    While data on total number of sales does have some significance, it is only when it is put in context with the amount of inventory. Even if sales volume is steady, if inventory is rising prices come down. Fluj, you cannot point to just half the equation.

  17. Posted by fluj

    Um, Trip, the topic is about volume? But I did thoroughly enjoy how you said median is “nearly meaningless” and average “absolutely meaningless” when the shoe was seemingly on the other foot.
    I don’t have “median” readily accessible in the stats that are provided. The average sales prices for SFRs in SF last year was $1.328M. The avg this year $1.318M. Do you think median will show that much more difference. And sales in 1-10 are now at 220 for May 2008. The difference might be down to a few points before the end of the week as realtors come back from their post sale vacations.

  18. Posted by John

    FSBO, good data.
    Let’s say the median dropped about 7%. However, this time last year, you can get 30-year fixed loan for 5.5% or lower. Now, it is close to 6.5%.
    Someone buying today will pay at least 10% higher monthly payment, despite the lower prices.
    When buyer pay high monthly (way higher than inflation), that’s not a crash mentality. Actually, if you plan to live in your property for a long time, I am almost tempted to say 2006 was the best time to buy.

  19. Posted by anon11

    Hmm, the first thing trip says is: “I’m not going to pretend that has a lot of significance . . .”
    But I do think Fluj’s characterization is correct at the beginning of this thread– there is “no collapse” as opposed to Chuckie’s use of “robust.”
    Yup, the data is still up for interpretation. Plenty to look at for bears, and still some to look at for bulls. I agree that SF real estate is a super tanker; I saw a very good story on the auto-correlating nature of residential r/e and the slowness of cycles to adjust to fundamentals because of this self-sustaining momentum.
    Strictly anecdotally from someone who has looked in the 2.5 to 4mm sfh range in the northern parts of the city– not a ton of inventory, but definitely more on the market before. And things sit. Realtors can say that anything doesn’t trade quickly is priced incorrectly but bottom line is things sit that would have traded before.
    Maybe there will be no collapse but unless you have very compelling personal reasons to buy or have arbitrarily large amounts of cash, risk/reward is pretty compelling to wait right now . It certainly seems more probably for a sfr listed at 3.5mm to eventually trade at 3mm than 4mm ultimately. . . .

  20. Posted by fluj

    anon11,
    That’s surprising to hear. I only see 18 listings between 2.5M and 4 in the north end. Of them, only six have been on for a month or more. (And one of those is the Telegraph Hill development property that has been overpriced for over two years now.) There’s one actively contingent, the Divis propertery that got into contract after one day, yesterday. ANd there are 5 pending. And there have been 30 such sales since 1/1.

  21. Posted by fluj

    I guess what I mean is, is that more than before? Anecdotally many of these seem to come and go in a blink of an eye.

  22. Posted by viewlover

    anecdotally many, contradiction in terms or witty sarcasm?

  23. Posted by fluj

    “Terms” ?? Many could be 20. Many could also be 200. Many is vague. And my qualifier was “a blink of an eye.” It was all rather phrased in language that one would use with the inexact anecdote. The sampleset was smallish to begin with if you must be specific. And if you want to pick apart language on the Internet, feel free. Who am I to stop you?

  24. Posted by anon11

    fluj,
    haven’t been on for a few days. So, I look at Pac heights, russian hill, Presidio heights, Cow hollow, marina. Every once in a while, I’ll check out someplace in Telegraph Hill and also further south. I don’t want to argue with the “anecdotally” comment above, but . . . anecdotally, if I had to buy something right now, there are a few places that have been out there that I could see living in my price range. Maybe 18m ago, there would have been more compromises. I guess maybe I’m talking quality more than quantity. Yes, if I had my druthers, I’d get a sfr between polk and Larkin on russian hill facing west, but that’s obviously pretty limiting.
    I’m more negative on the market than you, but I agree there has been no price collapse and there might not be a “collapse.” But I still feel that risk/reward is pretty compelling to wait. Just my opinion.
    I wonder if you and others think that 2-3 unit places keep pace with SFR in terms of price? i.e. there is a finite number of SFR out there and the current buyers may still be families with cash who feel compelled to buy now for personal reasons as long as they think the market is not going to fall apart. It seems like the usual SFR pac heights places would be the most price protected so to speak, but the 2-3 unit places or places would not appeal as much to those buyers . . .
    Yes, I like data, not anecdotes, but all I have is anecdotes from occasionally going out and seeing what is out there. Not in any rush . . .

  25. Posted by fluj

    Only 2-3 units? Not 4 as well?
    Personally I would think that 2 would be its own category and then 3 and 4 could be lumped together. Why 2-3? Anyway …
    So far this year two units are 125 sold, $1.368M avg sp, 502 a foot. Last year (1/1-6/7) saw 158 sales, $1.366M, and 497 a foot. So volume is down by 20% for two units but price is barely higher.
    For three units it’s been 26 sales this year, 1.603 avg sp, 424 a foot. Last year was 44 sales and 1.482M and also 424 a foot. Last year three units also took 69 days to sell and this year 51, nearly three weeks longer last year.
    So yeah, two and three units are at least holding their value so far.

  26. Posted by anon11

    Thanks for the info, fluj. I know people usually lump 2-4. I guess personally, I don’t particularly want to be a landlord, but can see 2 units or 2 plus an in-law. Strictly personal– no market rhyme nor reason to it.
    Btw, I hope your business is going well– it’s great when someone provides data, as opposed to spin and little info. I imagine in this market people like that will fall by the wayside a bit. .

  27. Posted by paco

    good points fluj (and anon11),
    traditionally the 2-4 lumpage occured b/c of financing and the bank’s classifications.
    but in SF, duplexes are exempt from the lottery for condo conversion purposes so these 2 unit buildings are in a class by themselves. the slight difference in total selling prices for 2 or 3 or 4 unit buildings confirm this.

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