San Francisco Sales Volume And Median Price: September 2011 (www.SocketSite.com)
Recorded home sales volume in San Francisco fell 9.7% on a year-over-year basis last month (399 recorded sales in September 2011 versus 442 sales in September 2010), down 17.6% as compared to the month prior and versus an average August to September seasonal drop of 8.7% over the past seven years. An average of 537 San Francisco homes have sold in September since 2004 when recorded sales volume hit at 763.
San Francisco’s median sales price in September was $613,750, down 1.0% on a year-over-year basis and down 0.8% as compared to this past August.
For the greater Bay Area, recorded sales volume in September was up 6.6% on a year-over-year basis, down 10.2% from the month prior (6,749 recorded sales in September ’11 versus 6,334 in September ’10 and 7,513 in August ’11) as the recorded median sales price fell 7.6% year-over-year, down 1.2% month-over-month.
At the extremes, San Francisco was the only County that failed to record an uptick in sales volume while San Mateo recorded a 17.4% increase (up 90 transactions) on a 3.6% decline in median price. San Francisco recorded the smallest drop in terms of median sales price while the median sale price dropped 13% in Contra Costa as volume increased 5.4%.
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed (“sold”) many months or even years prior and are just now closing escrow (or being recorded).
Bay Area Home Sales Up, Prices Down from Year Ago [DQNews]
Recorded Sales Activity Up 7.3% In August As The Median Drops [SocketSite]

31 thoughts on “Recorded San Francisco Sales Activity Drops 9.7% In September”
  1. I’m confused. How does this compare with the article two below: San Francisco Listed Sales Volume Ticks Up On Lower Median.
    I tried to read both to see if it was an area discrepancy or a type of property discrepancy but can’t seem to find the difference.
    [Editor’s Note: As noted above, Recorded sales volume includes sales that were never officially Listed on the MLS (think the majority of sales in new developments, “pocket” listings, private sales, etc.) and is a more complete measure of the market.]

  2. Isn’t sale volume proportional to listing inventory? Seems logical that fewer people would be putting property on the market if prices are averaging lower.

  3. “Isn’t sale volume proportional to listing inventory?”
    No. Sale volume correlates with demand, not supply. Prices are a factor of supply and demand.
    As to your example, it may or may not be the case that fewer people would be putting property on the market if prices are averaging lower. However, if supply were so restricted, one would expect to see higher prices (the supply-demand curve would shift). But we are seeing lower prices.

  4. As an owner, I’d avoid selling right now if I could. Instead, I’d rent my property out and let someone else make my payments since that market is hot. Using that logic, sales volume would have to go down. How exactly do you sell something that doesn’t exist?

  5. From +11.0% to -9.7% YOY change in sales due to whether properties were officially listed?!? Doesn’t that seem like a huge swing? Am I missing something?

  6. fdsfds@sdfdf.com, your hypothetical would result in one fewer unit in the supply. It would not have any affect at all on demand or sales volume because buyers (i.e. the demand) would just buy a different home that is for sale.
    In a perfect model, it would result in prices moving slightly higher.

  7. I think both of us are being pretty hypothetical A.T. However, you can’t sell 501 properties if only 500 are on the market. I think a better metric to use is probably % sold (sales volume/total listings). If we were to see a significant decline in % sold, that would be a stronger indicator of tough times.

  8. I am also curious as to the discepancy between the earlier report where volumes ticked up slightly. That had 375 sales this year, and 367 last year. That means that there were only 24 unlisted this year, as opposed to 75 last year. Possible, but something seems off. This isn’t the first time the reports appeared inconsistent, although I’ve seen even worse apparent differences than the one this nmonth.
    fdsdfds – you are totally correct.In fact, there used to be a bi-monthly inventory report on this very site, which was great to determine such metrics as those you want to see. In fact, many here have often toldme that sales figures themselves have no or little meaning unless the inventory situation is considered too in parallel. However, a few months ago the report stopped, and my queries as to why have met only with silence.
    Here’s the last – or one of the last – such reports – whcih showed inventory down YOY, and the gap between last year and this year seemed to be falling fast. The situation can change rapidly postLabor Day,however, which is why an update would be appreciated!

  9. @ REpornaddict: Is Adam getting tired of Socketsite? I too think that was one of the most useful metrics on the site..

  10. @ A.T.
    “No. Sale volume correlates with demand, not supply. Prices are a factor of supply and demand.
    As to your example, it may or may not be the case that fewer people would be putting property on the market if prices are averaging lower. However, if supply were so restricted, one would expect to see higher prices (the supply-demand curve would shift). But we are seeing lower prices.”
    Obviously, sales volume is a function of both, as someone already pointed out.
    As to the “curves” shifting, even if your “supply curve” shifts (I don’t know what a supply-demand curve is) to the “left”, prices may nonetheless drop if the demand curve shifts (to the “left”) as well by a greater amount.
    To state the obvious if your supply falls by less than demand falling, prices will also be reduced.

  11. I was wondering what happened to the inventory chart. So fyi, per the MLS there are 1428 active listings of SFR’s, Condo/TIC/Coop/Loft. That appears to be in line with 4 of the previous 6 years – the low or “normal” years. Such an easy chart to keep posting that it is baffling why it would disappear for 4 consecutive months. Is it not telling the correct story?

  12. Its interesting to compare SF to rest of bay area- bay area volume has soared. But their prices are down. SF held prices steady, but vol. Is down. May be partly due to more SF people renting their places out, as someone above mentioned. I believe that is definitely an influence on the reduced vol/steady median price dynamic.

  13. also MLS sales in Sept are up this year vs. last year. 383 this year, 367 last year, 422 in ’09, 349 in ’08, 364 in ’07.
    ’09 was dead in the water during the early part of the year and Sept got some of that pent up demand. Otherwise, this seems to indicate that new normal seems to have settled in.
    Since interest rates don’t appear to be going anywhere for a couple of years, we may all just get too bored to show up to SS to see paint dry every day

  14. We’re japan.
    Interest rates will fall as demand declines so that price declines will be spread over a longer time period. Price declines are being throttled to 5-6% per year and will be for some time. Boil the frogs slowly and they don’t jump out of the pot.

  15. prices will continue falling in real terms – in nominal terms they have probably stabilized; the whole country is being boiled and there isn’t anything anyone can do about it; best to just enjoy a martini while the orchestra plays out its last tunes.

  16. Thanks hangemhi! So it looks like inventory is around 20percnt down you, though hard to tell exactly.and with listed sales up 5percent or so, seems to be a stronger position using the oft previously mentioned sales expressed as months of listed inventory metric.
    At last the inventory silence has been broken. Keep us posted!

  17. “We’re Japan,” in a thread about a city’s sales activity. This stuff is beyond tired from you samebot fake critical thinker/ look at me I’m a hater too guys. We are not Japan. “We” discuss a particular area, and its real estate. Texas is not Japan. NYC is not Japan. Los Angeles is not Japan. And SF is not Japan. Good grief. Why are you and your cronies so played out, and even more, why does the ed. choose to enable your easy words? Get a life.

  18. AT is right. It’s demand which moves sales as well as supply, not the other way around. That is true for paper or plastic.
    SF market Is definitely more resilient that others. One of the reasons could be that buyers are waiting out to see what would happen to the federal tax law changes.

  19. The demographics of child birth and immigration make “us” decidedly not Japan.
    Population in Japan in 1990 was estimated at ~123.5m.
    In 2009, it was estimated at ~127.5m.
    Population in the U.S. in 1990 was estimated at ~249.6m.
    In 2009, it was estimated at ~307.0m.
    In 2007, it was estimated at ~301.6m.
    The U.S. adds more head-count in two years now than Japan does in twenty years.
    (Data from World Bank and accessed here: http://www.google.com/publicdata/directory)
    Demography weakens the comparison, since population growth is among the drivers of economic growth.
    There will be millions of more Americans to absorb the overhang over the next decade.

  20. “However, you can’t sell 501 properties if only 500 are on the market.”
    “As an owner, I’d avoid selling right now if I could. Instead, I’d rent my property out and let someone else make my payments since that market is hot”
    Like listing price, listing inventory is part reality, part psychology. Units waiting out the market as you indicate above are basically supply since they are available to buy given some combination of higher price or lowered expectations.
    Contrast this with some mineral where world production is X and it takes years to build a new mine. In that case there truly is a hard supply limit at X.

  21. I think the point is that Japan is a xenophobic nation which would rather build robots than permit gaijin to take up residence. We still have a net inflow of immigration and large families relative to most of the developed world. We’ll keep growing, Japan is trying not to shrink.

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