Positioned as “an excellent opportunity to purchase a beautiful new construction residence in one of the hottest neighborhoods in San Francisco,” with “contemporary finishes, excellent views, and wonderful outdoor spaces,” the 1,432-square-foot, two-bedroom Bayview condo #6 at 4132 3rd Street sold for an even million dollars, or roughly $698 per square foot, in April 2015.

Returned to the market this past February listed for $1.075 million “in vibrant Bayview (aka trendy Dogpatch Extension!),” a sale at which would represent annual appreciation of 3.9 percent over the past two years, the list price for 4132 3rd Street #6 was reduced to $995,000 in March.

And the sale of 4132 3rd Street #6 has now closed escrow with a reported contract price of $987,500 or $689 per square foot, 1.2 percent below its sale price two years ago on an apples-to-apples basis.

Comments from “Plugged-In” Readers

  1. Posted by 4thKing

    Is this not consistent with condo reductions across the city? Bayview SFH still seem to be appreciating like crazy, especially compared to other parts of the city.

  2. Posted by Just My Opinion

    Nice unit. Close to transit and Flora Grubb (!), but one will need to have A LOT of patience with regard to very industrial and NOISY neighborhood.

    • Posted by lana_del_bay

      This area is what’s called the Bayview Industrial Triangle Redevelopment Area per the City, and is targeted for mixed-use development. There are a couple large (6-story) projects in the works on adjacent parcels, such as 4200 Third St directly next to Flora Grubb and another across the street. So the industrial nature is changing.

  3. Posted by that_dude

    “Hottest neighborhood in SF”. I get it.. it performed as one of the best financially, but will never be the “hottest” neighborhood in SF… laff.

  4. Posted by Dave

    Prices are still going up in areas like BVHP. I’m not sure if that is just SFH prices or condos also. Being less expensive than the rest of SF has helped drive home values up in the SE section of SF.

    If condo prices are starting to fall in BVHP, that could be a red flag for the overall SF RE market. How would that impact HP Lennar with its thousands of planned condos or the smaller projects in the works nearby?

    Look at the photo. This is hardly a luxury building or a luxury neighborhood. The surrounding row homes and cluttered streets will, at least aesthetically, prevent it from being a luxury living destination.

    For less than a million one can get a detached home in Oakland or San Leandro. These neighborhoods are not great now but the potential for them to be transformed a la many of the neighborhoods on east side of Portland – Montaville – is real. Or, if one prefers an already nice neighborhood, for a little more than a million you can get a small arts and crafts home in Burlingame between El Camino and California.

    • Posted by lana_del_bay

      “Surrounding row homes” lol. You mean the same type of homes in the rest of San Francisco? Bayview has very similar housing stock to other neighborhoods like the Sunset, except with more architectural variety ranging back to 1900 Victorians (instead of just the Doelgers). And if you’re talking about real potential for transformation, look no further than the Bayview.

      • Posted by anon2

        It’s had “potential” for decades. If it hasn’t transformed after a few massive booms, how will it fare during a downturn?

        • Posted by lana_del_bay

          Looks like it is transforming to me. New restaurants/bakeries/breweries etc, complete rebuilding of the Hunter’s View and Alice Griffith Housing, Candlestick under construction, Shipyard under construction, new housing on Third St, etc.

  5. Posted by sf12

    I love the view of the ambulance chaser billboard, was that highlighted in the listing package? Flora Grubb is cool, there are some great new eateries and cool things going on but it is still a tough neighborhood, 3rd street rail is not efficient, not much in the way of parks, although they will be built in the next 20 plus years.

  6. Posted by Pero

    I don’t really understand what this example should communicate. Should we conclude that prices are falling for condos? Or should we conclude that prices are surprisingly stable given the repeated touting of a massive increase in condo supply in SF? Hey, you’re comparing to the absolute top of the cycle in 2015 and prices are down just 1.3%?

    As many have argued above, this condo is cherry-picked and not representative of real estate prices in the Bayview at all. SFH prices increased by 10% year over year in this neighbourhood.

    • Posted by 4thKing

      Bingo. If we want to cherry pick even more, one could say that this Bayview condo has held its value better than the Millenium Penthouse.

    • Posted by SocketSite

      Despite the wrote “cherry picked” barb, the outcome for this anecdote wasn’t known prior to our having picked it. The headline above could have read “Ten Percent Appreciation in the Hottest Neighborhood in S.F.”, if that’s what happened. But it didn’t.

      There are plenty of thoughtful discussions to be had: the difference between a change in a neighborhood’s median price versus actual values; the market for condos versus single-family homes and long-term correlation between the two; and alpha versus beta for particular neighborhoods, just to name a few. Or one can simply choose to whine.

      • Posted by lana_del_bay

        I believe the ten percent appreciation number was referring to SFH. So…

  7. Posted by jenofla

    Why are new construction condos priced so high? A million is a lot, when you can get a SFH for less than that nearby. Some Ocean Ave condos just came to the market and they’re well north of a million with HOAs in the 700’s…when Ingleside SFH go for less. If that’s necessary to cover cost of construction and land, the math isn’t great for developers, and it definitely is a terrible short-term hold for buyers.

    • Posted by Pero

      I wouldn’t buy this condo at this price tag, but let me try to explain some possible motivations:
      1) The square footage and layout (3bd, 2br) of this condo is comparable to a SFH.
      2) Most SFH that go for around $800k in this area still need updating. Remodeling the kitchen and bathrooms can cost you between $40-80k. This price tag doesn’t include the wear and tear of 50-100 year old houses. Most people don’t want to go through that and pay a premium to get an already remodeled place.
      4) Buyer might be planning to rent out two rooms. You could pocket $2k for each and use it to pay for a major part of the mortgage. Long term, once Uber moves into the new Dogpatch HQ, rents are likely to go up substantially.

      • Posted by Panhandle Amigo

        Pero, I agree with your list, and here’s two more.

        – This condo provides optionality related to commute. In 2019, the Central Subway will be done, adding direct Soma and downtown access from right outside your doorstop. It’s also a breeze to hop on 280 or 101 to zoom down south.

        – Some people are big believers in buying into an up-and-coming neighborhood and convince themselves that either it will gentrify rapidly (usually overly optimistically so).

    • Posted by condoshopper

      you’re also paying extra chunks to make up for the money that the developer is not making on all of your neighbors’ BMR units.

      • Posted by SocketSite

        No, you’re not. Real estate is not priced on a cost-plus basis. Developers sell or rent every unit in a development for as much as the market will bear. The price for land, however, is impacted and tends to drop when BMR requirements are raised (as are developers’ profit margins which tend to drop as well).

        • Posted by condoshopper

          but government policies will distort what the market rate would otherwise be (e.g. which price point “pencils out” for the developer”). it’s the way most would argue that rent control raises the rent for non-controlled units. the equilibrium price can uniquely be affected by government regulations.

  8. Posted by condoshopper

    from this buyer’s perspective, even in this tough housing market it’s hard to understand why/who who would want to pay a million bucks for a condo in the bayview, whether 2015 or today. almost every alternative that’s available for 1 million would seem better than this.

    • Posted by anon2

      “it’s hard to understand why/who who would want to pay a million bucks for a condo in the bayview,”

      Most anyone who thinks it will eventually be a $1.2M condo. Very few people when they think the days of it being a $1M+ condo are numbered.

    • Posted by Panhandle Amigo

      What if you work in the South Bay, but your husband works downtown? This unit is perfect. The Central Subway finishing in 2019 is a game-changer commute wise for this condo.

      • Posted by condoshopper

        hm, i hadn’t considered the 2-person scenarios. but i’d rather get a 2-bedroom condo in a non-troubled neighborhood somewhere in south city/milbrae instead, to split the commute distance. plus these low-rise buildings are almost certainly wood-only construction and should carry a lower premium than than the metal framing (mid-rise) or high-rises.

      • Posted by Pero

        The access to the City AND the peninsula has been a huge driver of prices in Bernal Heights and Potrero Hill. Now that SFHs are going for $1.3-1.6M in these neighborhoods, the price increases are swapping over to other parts of the South Eastern part of town. With the way prices are going up in the Sunset, this is really the only part of the city that is still affordable and that allows for the city and peninsula commute.

    • Posted by Sabbie

      Agreed. The target demographic must be pretty small (priced out of Dogpatch, commuting down the peninsula). Or very likely, investors, which explains the price cut given falling rents.

      You can get the same or better in Emeryville or Oakland for $600-700k; I’ve heard the arguments of Bayview vs Oakland and many are valid, but are they $300-400k valid?

      As for comparable SFR in Bayview, check out these: 1523 Shafter (active), 2638 Phelps, 1010 Ingerson.

  9. Posted by Amewsed

    It is like all trendy “hot” neighborhoods — at some point, it will exceed the cost of more traditional neighborhoods.

    Think certain hot neighborhoods in Brooklyn vs. the more traditional Upper East Side or Upper West Side of Manhattan. At some point, the UES will be a bargain while holding its value over the long term. I rather buy in traditional neighborhoods when everyone else is chasing the hot trend.

  10. Posted by Bayview_Rising

    Meanwhile, the priciest condo in Bayview history is in contract for $1.41 on Quesada and another listing for a SFH just 2 blocks from the condo in this article is listed @ $1.995 after a rumored unsolicited offer for $1.9.

    • Posted by SocketSite

      We’re guessing you mean Oakdale not Quesada, a sale at which would be $788 per square foot, and the house you’re referring to was priced at $800 per foot and is in contract.

      Both are (well) above-average in terms of design, finishes and size for the neighborhood. And both are first-time sales with no history with which to compare or measure on an apples-to-apples basis.

      But it is undeniably true that newer, bigger and higher-end units tend to sell for more than average and drive up the overall median price paid.

  11. Posted by dr wu

    classic value trap

  12. Posted by spencer

    still way overpriced for this neighborhood

  13. Posted by anon

    Different neighborhood, different result. 52 Alpine Ter. #3, new construction 2BR 1131 sf condo, sold for $1,482,000 in May 2015. Just closed at $1,950,000.

    I see permits for small repairs to the deck and a closet, but that’s it. So call it a 30% increase in 2 years.

    • Posted by SocketSite

      Don’t forget a little remodeling in the kitchen and elsewhere that you missed. Regardless, do you have anything in a different city as well?

      • Posted by anon

        So, a 29% gain in two years for this San Francisco condo.

        A different city? Not interested.

        • Posted by SocketSite

          And a 24 percent decline in value for this San Francisco condo since the end, versus beginning, of 2015. So now we’re even with different examples that have nothing to do with the neighborhood or segment at hand.

          • Posted by anon

            Fair enough. I had mistakenly thought some broader trend was being posited. So we’ve demonstrated that one Bayview condo value dropped a miniscule percentage since 2015. One SOMA/South Beach condo saw a big drop since 2015. Let’s just not pretend these represent any broader trend, and, in fact, they may (or may not be) total outliers. But I see now that was not the intent.

          • Posted by SocketSite

            So just to be clear, you have nothing to add on the actual topic at hand other than an unrelated example that doesn’t disprove a broader, much less specific, trend.

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