While the number of homes listed for sale in San Francisco hit an 8-year high this week, the pace of home sales in the city is still down, both in terms of year-to-date sales and recent contract activity (which remains down around 10 percent versus the same time last year).

At the same time, home sales across the Bay Area are down over 10 percent over the past year as well and the indexed appreciation for single-family homes, which has significantly lagged the national average since the end of last year, has dropped to 0.2 percent.

Comments from Plugged-In Readers

  1. Posted by tipster

    Doesn’t surprise me. The CEO of Juul just quit, under criminal investigation of the company and most of its products becoming illegal to sell, the company announced layoffs and a review of all open positions, mirroring Uber’s ongoing layoffs. Juul was a significant driver of maintaining real estate prices at their current levels, and now it’s gone.

    • Posted by Ohlone Californio

      You cannot be serious with this ^ drivel.

      • Posted by Backtotheburbs

        Meanwhile, Amazon has 30k open jobs in Seattle alone. Job fairs with thousands lining up. Same in Chicago and elsewhere …

        Do you see that here?

        It is clear the Bay Area has reached peak tech, likely downhill from here as all new and excess capacity gets siphoned elsewhere.

        Also a unicorn just went IPO in Germany. People have Internet and keyboards everywhere, plus often great free education and better quality of life. They used to be naive about Bay Area promises, but the cat is out of the bag. Meanwhile AirBnb employees are reaching stock option deadends, and more we haven’t seen in public media yet.

        Looks like what’s keeping many people in the Bay is high paying jobs (but usually not really high enough) and large investments that are on a depreciating trend. That is now being effectively chipped away …

        • Posted by SFRealist

          People in this site have been predicting the impending tech crash for years. How is this time different?

          • Posted by jimbo

            not to mention, only 12% of SF employees have a relationship to tech. and the big players are still hiring (salesforce, google, apple, facebook)

  2. Posted by Brahma (incensed renter)

    And With Juul, Altria Got More Than It Bargained For:

    Juul said this morning it will cease all advertising and lobbying in the U.S., a move that seems aimed at trying to show regulators that Juul can be a responsible corporate steward without government intervention.

    To be fair to Ohlone Californio, the “wealth creation” did happen, but of course now it’s apparent that it was a one shot deal with a simple transfer of wealth from Altria’s shareholders to Juuls, and from all current appearances that investment will never pay off. Welcome back to the “I got mine” economy.

    • Posted by Ohlone Californio

      Right. And in the context of what this site is about, San Francisco real estate, that one time wealth creation event is the only relevant thing here. It’s not as if IPOs happen more than once anyway. I mean, come on.

      It’s simply not fair the way bearish posters get to spout ridiculous babble on here and the editorial team says nothing. Yet someone with a more bullish outlook says something remotely argumentative, and it’s a series of editorial comments, if the post is even allowed to stand.

      It’s nonsense. This Juul post by tipster earlier is baloney. He or she knows better. The editor(s) know better. The whole community knows better.

      I don’t have the time or the energy to police this crap. There are too many people on Twitter to argue with, you know what I’m sayin? Donald Trump needs to be told where to stick it, etc. Ha. I kid. I kid.

      • Posted by tipster

        That would have been an enormous IPO, or more likely, acquisition. The $39B valuation investment by Altria was made after about $2B in funding. The overwhelming percentage of the remainder of the company was owned by employees. That wealth will now never meet up with the local real estate market. It will make a very big dent, then add all the layoffs and canceled hires.

        • Posted by Ohlone Californio

          Your understanding of the Juul event is completely erroneous. And I really don’t care to elucidate it for you, as you’re utterly disingenuous at all times.

          • Posted by curmudgeon

            My understanding was that there was no lock up period on the Juul purchase, which would mean that smart or lucky employees cashed out or diversified pronto. I’m sure those that didn’t are not very happy this month. So….I’m guessing that if you calculated it it WAS a very substantial wealth creation event for employees but not in the end as big as hoped.

          • Posted by Ohlone Californio

            The word was hardly anyone waited around at Juul. There was already worry about the FDA, dating back for some time well before the cash outs.

          • Posted by tipster

            Juul was a dividend, paid to even people with un exercised options. The company paid out part of what it got from Altria to quell the objections of being owned by big tobacco. There was no lockup. Taxes were 3.5% higher than ordinary income taxes because it is treated as short term capital gains, so greater than 50%. Average payout was about a million dollars, $2B in total, at the beginning of 2019.

          • Posted by Ohlone Californio

            Right, something like that. So, naturally, some people will wait until after spring 2020’s tax season before making their next moves. But some are in the market. Anecdotally, I was told that 200+ San Francisco Juul employees made 2M or more. Regardless you said that wealth will now never meet up with the local real estate market. That’s simply false.

      • Posted by SocketSite

        Which brings us back to the topic at hand: home sales in San Francisco are down (while inventory levels are on the rise and the indexed appreciation for Bay Area homes has steadily dropped over the past 17 months to within 0.2 percent of negative territory, despite every liquidity event and a significant drop in rates over the past year).

      • Posted by wilson

        “Right. And in the context of what this site is about, San Francisco real estate, that one time wealth creation event is the only relevant thing here.”

        Not true. Anecdotally many of the Uber employees are looking to ‘cash out and get out’. Many of the Juul people probably are too. Like you say, the IPO is a one time event. If you don’t see good long term prospects here why sink money into RE here. Especially now as the market is looking shaky. The serious problems at both Uber and Juul are very relevant for RE here.

        • Posted by Ohlone Californio

          What is your understanding of the Juul payouts? Because you don’t seem to understand what transpired either.

          • Posted by john

            Inside the new Uber: Weak coffee, vanishing perks and fast-deflating morale

            “Meanwhile, stock units are valued at a fraction of what many employees were led to believe. And executives are imposing workflow changes aimed at improving the company’s efficiency, adjustments that strike some employees as stifling innovation.”

            “Even as a hiring freeze for some U.S. and Canada engineers was in effect, Uber had already ramped up its efforts to tap the global market for employees, a move that struck some employees as a sign of further corporatization. It looked to other engineering outposts, including India, to sweep up new talent at a lower cost. LinkedIn searches showed several dozen job postings for design and engineering-related positions in Bangalore and Hyderabad, India, where Uber hosts offices, just in the past several weeks – as the hiring freeze elsewhere was in effect. But employees were laid off in India as well.”

          • Posted by shakti

            “One former employee had been hoping to pay off their house. Now that person says they will be lucky to buy a bike or two.”
            Key takeaways…
            1) Already had a house. Not waiting for the lockup. Might have bought too much house based on expected payout.
            2) Payouts drastically reduced.
            Now solve for the San Francisco Real Estate market.

          • Posted by Ohlone Californio

            Here is what one Uber employee said about it:


            “2015 and before – millionaires.
            2016: millionaires if level 5 or above.
            2017: millionaires if L6 or above.
            2018 and later: future millionaires if level 5 or above (despite the price drop and allowing for further 20% drop in the near term, but 15% compounded growth over the next four years)”

          • Posted by Yo Vinney!

            That post was on their IPO day. They went out at $45 the usual pop was expected. Many still expected/hoped they’d hit the original target of $120B market cap. Lots of top execs/engineers had big payouts riding at the $100B and $120B level.

            They are at $29/share now and dropping. With a $50B market cap.
            Read on that thread: “…in 2016 Uber was giving up options at $49 valuation.” People with options at $49 have nothing today.

          • Posted by Ohlone Californio

            I don’t know why you would take the anecdotal Uber employee post I submitted and editorialize it, but OK that’s what you did. So, no. That’s not what this person posted. They posted 2015 and earlier, millionaires. Then they qualified 2016 and on shares based upon levels. You talked about 2016 and on, and a strike price.

            Now show everyone the amount of 2015 and earlier Uber employees there are. If you’re being honest, that is.

  3. Posted by Anonoly

    So you have a bullish outlook on Bay Area RE from here on out? Please do tell us why you think we’ll see significant appreciation in real estate here. All signs point to a decline and you appear to be in denial.

    • Posted by Ohlone Californio

      Your comments have little to do with the things that I have said, Anonoly. “From here on out” ? meaning, for all time? No, of course not. Significant appreciation? meaning near term? I did not say that.

      “All signs point to a decline and you appear to be in denial” ?

      I think we are in a period of slight price appreciation over a record year, 2018. The market is bifurcated. A larger amount of condos, relative to San Francisco’s small build output over the last 20 years, have come online over the past couple years. This has made older condos decouple from newer condos. Condos in general have decoupled from SFRs, which have remained extremely competitive and are trading at all time high sales prices.

      So let me ask you this. Why would SFRs trading at all time high sales prices be part of “all signs point to a decline” ?

      • Posted by wilson

        “Why would SFRs trading at all time high sales prices be part of “all signs point to a decline” ?”
        ‘Trading at all time high’ is a spin on ‘flattening out’.

        The Case Shiller for SFRs has dropped from double digit gains to 0.2% year over year, with the middle tear down -1.5%. Condos per CS are doing slightly better, but many of the apples to apples look worse for condos. Like the editor says, condos are a leading indicator for SFRs. No indication of this decoupling.

        You and your pal sparky have spent a year on hear hyping up these IPOs. I admit that it seemed like it could be something, what with the companies being HQed here and the IPO size. But it just didn’t start off a new RE boom. Just didn’t happen. Its shocking really that the market has gone from hot to flat/down even in spike of all these IPOs. But you gotta deal with whats real.

        • Posted by Ohlone Californio

          I’ve pointed out my theory regarding the IPO cavalcade, which is far from over, has looked like multiple times on here. That is a flight to quality and 2M and up strength, and the numbers are there if you look. If you don’t care to intake that then fine. What do you know about the various lockup periods, by the way? My understanding is that only Lyft has kicked on so far and that was this Tuesday. Even Juul, which was simpler and largely an early 2019 payout to the rank and file, will necessarily have some people wait until next April because of subsequent tax implications.

          • Posted by scurvy

            I don’t have a horse in this race, though I’m looking for a (nicer) 3BR+ SFR under $2m and hope to see it happen in 2019 or 2020. That said, the IPO market for 2019 has slammed shut with the DOA dead-cat bounce of Peloton. AirBNB won’t happen until 2020, and all of the “better” enterprisey SaaS companies are already out there. There’s nothing good left in the pipeline. Consumer stuff (beyond artificial meat) is massively out of favor, especially the kinds that require insane investments for almost guaranteed losses (Uber and Lyft).

            AirBNB will be a flare-up late in 2020, but this IPO cycle is over and done. See you in another 6-8 years.

          • Posted by sparky-b


            Your search must have more restrictions than that because there are 101 of those houses on the market. I’m sure some are fixers, but there has to be a bunch that fit your needs. You must be only looking in specific neighborhoods.

          • Posted by scurvy

            sparky-b, north side of town only. Neighborhood matters to me more than house.

            The megan’s law map was enough to convince fam to stay north of California.

        • Posted by Ohlone Californio

          Also “trading at an all time high” is not a spin on flattening out. It’s, “trading at an all time high.”

          The spin is that constant year over year massive appreciation is something I’ve talked about. Because it is not.

        • Posted by sparky-b

          “you gotta deal with whats real” and I “spent a year on hear hyping up these IPOs” should not be in the same post.

          I haven’t been hyping the IPOs, I don’t track the IPOs or their lock ups. I do track an part of the market, nice single family homes in southern hoods, that I would guess might appeal to the IPO money crowd. that market segment is up and “hot” not flat/down. The other area I track is the entry/move up 3/2 housing (not probably IPO, but I don’t know), and even the editor conceded that the floor has been raised on those over the last few years.

      • Posted by Anonoly

        Why would SFRs trading at all time highs point to a decline? Seriously? Do you not see the trend? We went from over 10% YOY gain to a .2% gain, with certain sectors showing declines. Not sure why you are being obtuse.

        • Posted by Ohlone Californio

          I am not being obtuse. You are conflating things, as the Bay Area is not SF, and Case Shiller is not the marketplace. CS is a useful tool. It is not the end all be all. It does not measure properties that in some ways define the SF market.

          2018 was a record year, an epochal year. And we’re up from it. Not only that, but we’re surpassing it. The tail end of 2018 saw a slump. This fall, barring a black swan event, will not see such a slump.

          As for CS, if you remove a few parts of the Peninsula the whole metric would look a lot different. Certain parts of Silicon Valley sustained a dramatic pullback that does not resemble anything else in the region.

          So no, I’m not being obtuse. I’m telling you what is going on.

          • Posted by Anonoly

            Where are you getting your numbers from? Even SF proper is trending down. This denial is so bizarre. In any case, I’ll check in with you in early 2020. For now, good luck.

          • Posted by Ohlone Californio

            I’m getting my numbers straight from the MLS, only San Francisco. As of right now for SFRs and condos + TICs 1/1/19 – 9/30/19 shows 3598 sales, averaging $1087 psf. The same period last year shows 3858 sales at $1071 per square foot.

            If you break out SFRs, it’s 1527 sales. $1014 psf vs 1598 and $999 psf. That’s 71 sales difference only, over nine months, and price up $15 per foot.

            That is where I am coming from. I simply can’t get on board with the tanking talk on here. It’s not justifiable. It all comes from a bogus concept. And that would be only year over year volume spike + hefty price appreciation indicates market strength.

    • Posted by sparky-b

      I am not a bull myself as I don’t see appreciation over inflation on the horizon. I also am hoping that we don’t see that, it is plenty expensive here already. But I would not say all sign point to decline, more like all signs on this site point to decline. There continue to be high priced new sales of single family houses which aren’t tracked here. There are also apples to apples sales as well. Here are some brand new ones:
      12 Addison Street (52% up 13-19)
      156 Southwood Drive (19% up 15-19)
      161 Devonshire Way (58% up 15-19)

      I brought this up on another thread, but isn’t the lowering the price of second trade condos what the “building boom” has been all about. Isn’t that a good thing and move toward a more balance market where there are options that have different pricings: new condos, older condos, Single Family newly developed, SFH resale, etc. The differentiation of these markets doesn’t mean a bear market is coming for all of them.

      • Posted by SocketSite

        Going back to 2013 really starts to muddy the waters, in terms of trying to isolate recent changes versus the strength of the market from 2011 through 2015. The floor has been raised for entry-level 3/2s (i.e., 156 Southwood). And with respect to 161 Devonshire, you seem to have missed, or forgot to mention, the remodel, expansion (from 1,400 to 2,050 square feet) and rewiring between sales.

        • Posted by Ohlone Californio

          You know what muddies the water? you, parsing the words of people who know what they’re talking about. Meanwhile, you let slide the unstudied words of people who do not know what they’re talking about. That’s what muddies the waters. Do you ever parse bears’ language on here?

          • Posted by [Leonard Y.]

            It’s quite obvious SocketSite author does not own a house in SF nor can he/she afford one here.

        • Posted by sparky-b

          “Going back to 2013 really starts to muddy the waters”

          um okay for an apple showing gain that’s not okay but heading of posts can read: “…While the number of homes listed for sale in San Francisco hit an 8-year high this week” and “Most Homes on the Market in San Francisco Since 2011”

          I only looked at the photos of this weeks sales, I did no deep dive. If Devonshire isn’t an apple then fine but it still got $1076/ft in that neighborhood. Definitely doesn’t point to decline.

          “The floor has been raised for entry-level 3/2s”, I couldn’t agree more. The market for those homes and I think the next step up in housing has been raised from 2015-2019, as it was raised from 2012-2015. Also the high end of Noe, Glen Park and Bernal are way up since 2015.

          • Posted by SocketSite

            Here’s the problem, elucidated: Up and Down on the Edge of Nob Hill

            “I did no deep dive,” is an all too common refrain. But for every apple we represent as such, we do. And the home on Devonshire wasn’t even close (remodeled, expanded and upgraded); the significant difference in listed square footage between the two sales might have provided a hint.

            Don’t confuse the tails of the market with the market as a whole, nor discount the leading indicators of such. Yes, the market for condos matters. And no, the market has not become “decoupled.” But it has become compressed (which is actually red flag from an analytic standpoint versus an indicator of strength).

          • Posted by sparky-b

            So you are now just going to focus on that one now, and not the others. They were just from this week is all. Still crickets from anyone on 1433 Diamond an apple I posted last week.

            And okay you really elucidated something, I guess. But I have never subscribed to the re-sale apple is the best way to judge a market. It is new vs. old when there are more new houses/condos to buy if you want new. As with most things new is more than pretty new. For example a house came out today in Noe Valley for $7.5m only 3 other houses have ever sold for that much (one of them an apple from april of a 2015 sale) the other 2 are of a totally different size and caliber. But it’s not an apple so nobody look at it.

            What to mean the market has become compressed?

          • Posted by SocketSite

            We actually touched on all three. But the big miss on Devonshire is why we typically don’t bother. And the vast majority of apples we feature aren’t actually “new versus old.”

            1433 Diamond does look like a decent apple, save for a few smart improvements (such as the newly landscaped yard, planters, upgraded garage door, etc.) and going back to mid-2014. And it’s an above average Noe Valley home with views that just fetched under $1,300 per square foot.

            And with respect to 350 Jersey, care to guess how many completely remodeled, 5-bedroom homes are there in Noe Valley? How many have sold over the past two years? And what percentage of the market that segment represents?

          • Posted by Ohlone Californio

            Of course the market is decoupled.

          • Posted by heynonnynonny

            I was wondering why so few SFH apples had been featured recently. I know volume is down but surely there have been some worth tracking?

          • Posted by sparky-b

            “How many have sold over the past two years?”
            15 have, and other than the 14.5m Hills street this will be the highest.

            As to 1433 Diamond; “And it’s an above average Noe Valley home with views”. As is so often said on here, that was true the last time it sold too.

            For the apple bit, “And the vast majority of apples we feature aren’t actually “new versus old.””, I apologize that I didn’t make myself clear. What I am meaning to say is that by definition an apple is New vs. Old. There cannot be a brand new apple, an apple is a resale of a lived in home. And I contend that it isn’t a great track of the market.

          • Posted by greznick

            With SFHs you are going to get more long holds and renovations. You have got to parse that out. Look at sparky’s picks.
            52% might look great, but that is a six year hold. The early part of that hold had CS doing 20%+ YoY and many double digit plus years after that until recently.
            19% for a four year hold is the same. Parse out the earlier appreciation and it is not all that bullish for the current times.
            And these are ones specifically cherry picked by sparky to look good. There are far worse out there.

          • Posted by sparky-b

            not cherry picked. They sold this week. That was the whole lot of them.

          • Posted by Ohlone Californio

            Cherry picking and posting the ones that happened this very week are not synonymous.

            It would be nice if the editor(s) pointed out things like that. I’m sensing a lot of readers would agree. But no. Instead, someone says something interesting, gets parsed and challenged, and someone else says something unstudied and wrongheaded and cool beans.

            Real honest playing field type website you got going here these days, Socketsite. Great look. /sarcasm

  4. Posted by anon

    Btw, the lockup period for Lyft was originally scheduled to end on Sep 24. However, they changed it to August 19th. Ostensibly this was to avoid the blackout period, but to move it ahead by more than a month at a time when the stock was/is sinking was odd and had bad optics.

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