With inventory levels ticking back up and the pace of sales having slowed, the percentage of homes on the market in San Francisco with an “asking price” that has been reduced at least once has ticked up to 32 percent despite the average asking price per square foot in San Francisco having already dropped last month.

Speaking of which, the asking price for the “fabulous” two-bedroom, two-bath unit #219 at 99 Rausch, a 947-square-foot condo with a “massive” courtyard-facing patio, has just been “improved” from $1.149 million to $1.100 million, an “at asking” sale at which would represent a 16.9 percent drop in value for the Western SoMa unit which was purchased for $1.324 million in February of 2019.

At the same time, the 857-square-foot, two-bedroom, two-bath unit #526 at 99 Rausch, which was purchased for $1,265,000 in June of 2019, remains on the market listed for $849,000, a sale at which would represent a 33 percent drop in value for the unit which has been on the market for 51 days.

12 thoughts on “Price Improvements Abound”
  1. These 500 to 1200 square foot white box units are already a dime a dozen and it’s going to get worse. It feels like it represents 90% or more of the new units on the market in cities like SF and Oakland in the last ten years. SFH’s are desirable, yes, but I wonder if the “house-like condo” will really start to feel like a differentiated offering one day, as these small white box units continue to pile up.

    1. There seems to be an audience for these white box units…an audience that wouldn’t consider buying a more thoughtfully designed building in a 1920s building. That said, a lot of those buyers have moved-away or no longer have to show-up for a job in the neighborhood.

      1. There’s definitely an audience, and it’s a big one, including lots of people living with roommates that wouldn’t mind their own place instead. However, if this trend continues for the next 50 years as it’s gone for the last 10, the number of white box units added is going to be insane, and every other type of unit, pretty much anything over 1500 square feet, will have barely added any. The 2,000 square foot, full floor condo will be more desirable than it is now?

      2. The term for a “house-like condo” that isn’t a detached SFH is Townhouse. An enterprising developer could build several more thoughtfully designed townhouses on that entitled parcel over on York Street in Bernal Heights that was put on the market with plans for ten new residences for $2.6 million. If/when they were completed (which I don’t expect anytime soon because S.F. developers are feckless), that project would have been an interesting test of the market for newly-built townhomes.

        In contrast, S.F. property developers usually do “innovation” by forcing buyers to effectively pay more for less home, which makes the higher rungs on the housing ladder, i.e. detached SFHs, more desirable in comparison.

        If enough developers come onto the S.F. real estate “scene” with “innovative” ideas like taking an SFH, such as the Rectory at 908 Broadway, cutting it up into a warren of 9 bedrooms and 7 bathrooms and then getting it legalized as a co-living space, then SFHs will become more desirable to folks wanting an actual house. But they’ll be much more expensive than they are right now, so the vast majority of people who need a place to live will be forced into buying those 500 to 1200 ft.² white box condo units currently piling up on the market.

  2. I hate to see all these cookie-cutter buildings take such huge price cuts because I do kinda like the building which has a decent roof deck and nice lobby, but Western SOMA is taking it on the chin at the moment. The developers ended up making a killing at an inflated original sale price and now the re-sale owners will end up taking a huge bath once a more normal price is finally realized. It is not looking good as we head into the late fall and winter selling season. $900 / SQ FT, here we come!!!

    The best guess is that #219 & #526 both sell @ $800,000 or so. We’ll see!

    1. As we outlined last month, “despite what you might have read elsewhere and/or been mislead to expect by others, the average asking price per square foot of the homes which are in contract has just slipped back under $900 per square foot and is down over 10 percent from the second quarter of last year to its lowest level, on a seasonally adjusted basis, in six years, none of which should catch any plugged-in readers, other than the most obstinate, by surprise.”

          1. too much at stake in SF and moderates are waking up. once the police and DA toughen up, criminal will stop coming from oakland to SF to committ crimes and do it there

            Chill, bro: I’ve read the cavalry is in sight.

          2. jimbo doesn’t specify what aspect of this neighborhood is “way way worse than it was 5 yrs ago”, but yes: the police are “toughening up”, at the behest of The Mayor, at least in regards to homeless encampments.

            From late last month, San Francisco Will Enforce Sit-Lie Laws When People Refuse Shelter:

            San Francisco will continue clearing tents from sidewalks and enforce the city’s sit-lie laws when people refuse offers of shelter, Mayor London Breed declared Monday.

            Breed’s announcement follows recent guidance from the Ninth Circuit Court of Appeals on a lawsuit started in September 2022…the mayor underscored that city workers will receive updated training on how to clear sidewalks and engage with unhoused people in a way that complies with the temporary injunction barring the city from forcefully moving someone living on the street without first offering them a genuine shelter option.

            Last month, the Ninth Circuit clarified that people who reject a valid shelter offering cannot be considered involuntarily homeless and, therefore, the city can enforce its laws against public sleeping and camping on sidewalks and in parks, in those cases.

            I’ve read elsewhere that The City has retracted guidance offered to police officers in January instructing them not to enforce, or threaten to enforce, laws prohibiting people from sitting, lying down or lodging in public spaces, and that officers are again permitted to enforce such laws against people who decline a specific offer of shelter or otherwise have access to shelter or housing.

          3. Given that the lawsuit is unsettled – read: could lose – and (already) there’s been an injunction, it sounds like a steps forward/step backward process (at best). I hope the WC covers what is essentailly doing the Mambo (even if it’s only rhetorically).

  3. UPDATE: Having failed to attract an acceptable offer, despite the drop to $1.1 million, the “fabulous” two-bedroom, two-bath unit #219 at 99 Rausch, which was purchased for $1.324 million in February of 2019, is now trying to go the auction route, with “bidding to start from $750,000,” a sale above which would be “over asking!” according to all industry stats and aggregate market reports.

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