Inventory of Active listed single-family homes, condos, and TICs in San Francisco declined 10.3% over the past four weeks which is not to be unexpected leading up to Labor Day weekend. Listed inventory is currently running 1.5% under last year’s levels on a year-over-year basis (down 17.3% for single-family homes, up 11.2% for condos/TICs) and 12.7% higher than at the same point in 2006.
Roughly 37% of active listings in San Francisco having undergone at least once price reduction with the percentage of active listings that are currently either already bank owned or seeking a short sale hovering around 12%. Expect listed inventory levels to quickly jump around 20% after Labor Day.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite’s San Francisco Listed Housing Inventory Update: 8/03/09 [SocketSite]
Comments from Plugged-In Readers
I called it!!!
I said green would cross below orange by Aug/Sept.
yep .. I remember you did.
And when the green line crosses the orange line …………………………………….
So what does this mean? Increased sales as purchasers feel housing is now affordable? Listings removed as sellers can’t sell in this market? Both?
Or more realistic pricing…
@J – It is a mix of all the factors you listed above
it is surprising though how many people are out there convinced that this is the perfect time to buy.
Prices are down interest rates are low, some free government money … I am seeing a lot of activities especially in the SFH
Don’t confuse the bottom with “going up”
We are a long way from any rise in RE prices IMHO.
However, I do not expect prices to keep dropping especially in the low-to-mid markets, since there will always be demand for cheap housing in the city.
Those in the +800k markets may continue to see depreciation because the pool of qualified buyers won’t be growing for some time.
Case in point is ORH…they sold a ton of lower-floor and cheapo units after the price drop, but a lot of the upper floors are still unoccupied.
Still, I’m amazed that we don’t have more inventory. Many on here have expected inventory to go up as distress forced properties on the market. We’ll see what fall brings, but it’s remarkable (to me, anyway) that the line has come back down to 2008 levels, at least momentarily.
Is there any reason to believe the graph includes all distressed sales and new developments? I think that’s the elephant in the room…
Many on here have expected inventory to go up as distress forced properties on the market.
It appears that foreclosures show no signs of abating. The latest count for Ess Eff is 1495 homes in foreclosure (NODs, NOTS, bank owned). This is up from 1402 properties in mid-August. I am guessing we will be hit with a ‘shock and awe’ campaign this fall (as banks start to unload properties), but anything is possible in this market. I just saw a 2bed/1.5 bath home put up a a sold sign in my East Bay neighborhood; then, a week later a ‘for rent’ sign appeared. Investors seem quite willing to absorb some of the losses in the waning days of summer. I’m going to keep my eye on that one to see if it gets rented.
I want to see the sales graph with these numbers. Way too low inventory to make much sense to me.
“Listings removed as sellers can’t sell in this market? ”
The biggest factor is de-listing and not listing at all (by banks and people). No one wants to sell right now, so if they “can” wait, they are waiting. Meanwhile, buyers are being enticed to buy now due to subsidies.
Anything can happen.
Maybe everyone refuses to sell and buy and the SF market grinds to a complete halt. Maybe sellers discover there is no V shape recovery and they begin to sell at a normal pace again. Maybe buyers gain confidence when unemployment stops dropping, and return to paying 75% (of a single income) on housing, and prices shoot back up again.
Markets are not rational (especially with government intervention), so its anyone’s guess.
I think you are forgetting that some people cannot sell: they would have to bring cash to the closing, so they are renting out the property instead.
Others have simply stopped paying their mortgage, or will by year end, but the foreclosure has not yet occurred.
Is this the tide going out before the tsunami? Stay tuned…
Recognize also that listed MLS inventory is something that can be controlled, at least in part and at least for awhile. If there are a few other similar homes on the market, you realtor is just as likely to tell you to wait to list it on the MLS, and he’ll take it as a pocket listing for awhile, so as to not give the buyers the ability to force the sellers to compete on price. Pocket listings have other reasons behind them, and it’s tough to keep too tight a control on inventory, but I never saw nearly the same number in 2004-2006 as I do now.
I’d be surprised if the green line goes all the way up to the maximum height of the orange line! That steep 2008 incline represents the timing of the financial crash, which caught sellers with their pants down last year. How many would have put their homes on the market if they knew what was in store for the economy last year?
Is it the bottom? Is it time to buy? Who knows!!!!!!
I suspect the green line will also cross the blue lines too. This 3-month rally is bringing out quite a few reckless knife catchers and they all need to go through the pipeline.
Real suckers’ rallies stay credible very far into the game in order to be the efficient hope crushers that turn the markets around.
The crowd that buys at 2004 prices thinks it’s getting a bargain by paying 20% under 2007 prices, discounting the doubling that SF saw in the 6 years before that. I think 2000 prices are THE real bargain. Maybe I am too optimistic, but patience has saved me a lot of money so far…
“This 3-month rally is bringing out quite a few reckless knife catchers and they all need to go through the pipeline. ”
With the guberment pumping trillions into the market, can you really blame the knife catchers? If they can’t pay the mortgage, the bank will rent it back to them for 50% off on our dime. You have to be an idiot not to buy an overpriced home.
You have to be an idiot not to buy an overpriced home.
Even with everything going on, it’s still cheaper to rent in SF.
your prediction is the best I have heard on Socketsite. You stuck your neck out, no one really agreed, but you have been proved right . well done!
kwh9, back in spring you wrote
“Decreasing inventory? I’ll sit up and take notice when that 2009 line dips below the 2008 line. Still looks like pretty big YOY increases to me.”
Well, time to sit up and take notice…
Finally, how is the perceived freefall at the 1m+ range reconciled with a SFH inventory almost 20% lower than a year ago?
Comments are closed.