Single-family home sales in The Richmond District remained consistent with what we saw in 2022 with a median price of $2,044,000.
The San Francisco real estate market experienced a shift towards normalization in Q1, moving away from what we typically see in SF; multiple offers, properties selling way over asking price. This has resulted in homes sitting on the market for longer, and some not selling at all.
Properties that are well-presented and priced correctly are still in high demand and will move quickly, but anything less-than turnkey and priced according to the old 3% rate market rather than the current rate environment will sit on the market significantly longer. There is an affordability issue in this higher rate market, especially for lower-median priced homes, as buyers in these price points are heavily rate conscious. Pricing strategy is more important than ever.
Condo Market
Condominium sales in the Richmond District were down in volume, but held steady in price in Q1 of 2023 compared to all of 2022; Demand remains high.
$sqft is dramatically more relevant in the condominium markets than single-family homes and can be generally used to assess the desirability of the condo market when comparing periods.
$876/foot in Q1 '23 over 8 sales vs. $1026 in all of 2022 over 78 sales is a compelling statistic. Yes, the market is down, but there is still a market of turnkey, desirable condos.
We've seen affordability be massively affected in recent months, and buyers in the condominium market are typically most affected by increased rates. The Richmond District condo market maintaining its average price point is a good sign.
Median Market
Single-family home sales in The Richmond District remained consistent with what we saw in 2022 with a median price of $2,044,000.
The SF market drastically increased in value over 2021 and the first half of 2022, as all surrounding markets did during that period, but has finally started to level out.
Buyers are much more hesitant to pull the trigger and buy homes now than they were before, which aligns with the trend of affordability issues and sellers having 'pre-6% rate market' value expectations.
Days on market jumped from 21 to 34 in Q1, highlighting that sellers have to be more realistic with pricing expectations or face the likelihood of sitting on the market for a long.
Luxury Market
The luxury housing market in the Richmond District saw only 1 property sale in Q1 of '23.
The average price for a single-family home raced up to the high $3M in mid '22 but has steadily been coming back to earth in this 6% rate market.
The single sale closed for $3,200,000M after only 6 days on market, highlighting that there are still plenty of buyers in the market for turnkey Richmond District homes.
The general theme of macro-economic activity is more-of-the-same. We're seeing a steady diet of stress events like Silicon Valley Bank's collapse and the sell off of others, First Republic flailed for a moment which caused the entire real estate market to hold it's breath (FR is San Francisco's leading residential mortgage lender), and tech companies are laying off employees and axing non-revenue generating business activity, all typical during periods of tightening. Also, the fed raises rates again at the turn of Q2 by 25bp and plans of doing this a few more times.
However, and this is a BIG however, California is a sunshine state. People don't go to open houses in the rain (we're ridiculous, yes). With the sun back out, I wouldn't be surprised if we saw a flurry of activity.
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