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  • Writer's pictureKevin Peterson

July 19th, 2023: Real Estate Trends In The SF Bay Area

 

KP Corner


RECENT SUCCESS: Asheville Multi-family Entitlement Project

  • 6 acres of undeveloped land in the city limits of Asheville, North Carolina

  • Entitled raw land to develop over 130 multi-family units

  • Leveraged the Army Corp of Engineering through the Infrastructure and Jobs Act of 2022 resulting in 50% more units


UNDER CONTRACT:

  • Redwood Shores (Off Market) - 4 bedroom, 3 bath, 2-car garage


OFF MARKET PROPERTIES:

  • San Mateo 3 bedroom, 2 bath, 2-car garage in Beresford

  • Santa Cruz 4 bedroom, 5 bath, 1-car garage on oversized lot

  • Redwood Shores 3 bedroom, 2 bath townhouse


FOURTH OF JULY: Celebrations were a hit!

  • Central Park in San Mateo was the place to be before the fireworks! With live music, arts and crafts, rock walls to climb, bouncy houses, face painting, ice-cream and more, our minions had a blast!


 

How Are The SF Bay Area Real Estate Markets?


Interest rates are keeping our Seller's Market in check. Why?


SF Bay Area Real Estate Trends - Month over Month (MoM)

Key take aways ....

  • There is more inventory than last month (as is the case with every summer) yet less of this inventory sold compared to last month.

  • Days on market (DOM) for the SF Bay Area is still well below 30 days and prices are going over asking by an average of 6% due to multiple offers.

  • Interest rates reached a 4 month high of 7%.

  • Price per square foot / sales price saw declines at various price points, attributable to higher interest rates and seasonal buying.

  • What sold the most over asking? San Francisco single family homes listed below $4.3M sold at the highest percent over asking.

  • What is taking the longest to sell? San Francisco high end condos over $2.3M and single family homes over $4.3M had longest days on market.

The charts below are month-by-month heat maps of pricing in the SF Bay Area. They are grouped by county and property type (Condo, Single Family Home, Townhouse). The metrics are Price Per Square Foot, Days On Market, how many sold, and the List To Sales Price Ratio. Green indicates items keeping prices up in comparison to previous month's metrics. Red indicates the opposite, i.e downward pressure on sales price towards a Buyer's Market.


(Click on each county's data to make larger)





SF Bay Area Real Estate Trends - Year over Year (YoY)

Here's the data to support the year over year price growth (supply versus demand) we are currently experiencing.


Seasonally adjusted, we are still at record low inventory and sales due to sellers' "golden handcuffs" of historically low interest rates.


As a result, demand is not being fulfilled at a rapid enough pace so homes are going over asking around the SF Bay Area by 105% in less than 20 days.



This is keeping sales prices near their 2021 levels, yet not back to the peak of May 2022.



 

What's Selling The Most RIGHT Now?


We evaluated the Mid-Peninsula and 5 SF Bay Area counties to see what price ranges are moving, what their average price per square foot was, how long they sat on the market, and for those that closed - what percent over or under asking was achieved.


Those that are pending, i.e. just went into contract....

What was selling the most right now in July 2023 across SF Bay Area real estate
Pending in July 2023

When compared to last month's...

  • San Francisco, Santa Clara, Alameda, and Contra Costa saw price per square foot increases.

  • San Mateo, and Mid-Peninsula cities saw price declines.



Here are the pending details for those interested.


 

Mortgage Rates & The Stock Market

  • Rates finally are coming back down after hitting a peak in early July. “The market had previously priced in rate cuts by the end of 2023, so there will be an adjustment to these new expectations that could put some upward pressure on interest rates in the near term.” (Danielle Hale, chief economist at Realtor.com)

  • The stock market (in general) is doing well. The technology sector has been outpacing the markets while reducing layoffs due to the Artificial Intelligence (AI) boom (e.g. ChatGPT, Bard, etc).

  • FED is predicting inflation to be above 2% until 2025. Due to last quarter's data showing "stronger than expected growth, tighter than expected labor market and higher than expected inflation," markets expect the FED to raise rates two more times this year.

  • At KPeterson.realty, we know not every lender is created equal and we work with lenders who's rates today are around 5.1% for 10/1 ARMS. Our lenders also may value your RSUs better than others. Reach out and tap into our network.





 

How We Help Our Buyers

  • We work with the best lenders who are able to beat the current interest rates (some as low as 5.1% on a 10/1 ARM).

  • Search For Homes by customizing your financial situation before contacting a lender to determine what you can afford.

  • Investing or not sure which areas to look in? Explore Markets to generate reports that analyze a city by days on market, average home price, price per square foot, average number of bedrooms / bathrooms / square feet in YOUR price point.



How We Help Our Sellers

  • We have a $0 down / 0% renovation program in which you don't need to pay back for one year, giving you flexibility on when to sell. The goal is for every $1 spent on renovations to net (on average) a $2 to $4 return on investment. Every family has a unique real estate scenario based on their needs and circumstances. Feel free to schedule a consultation with me today.

  • Click "What's My Home Worth" to find out the rough value of your home and automatically monitor it monthly. It also shows you various options for your equity (refi, home equity line or loan, etc).

  • If you'd like a more specific valuation of your home, give me a call.


Check out our last few or peruse all of them at https://www.kpeterson.realty/blog

  • Mar 16th: What Happened To Bay Area Real Estate In February?

  • Feb 23rd: Which Bay Area Cities Are Selling In Under 20 Days?

  • Feb 14th: What Is Selling (Year To Date) In The Bay Area And Mid-Peninsula?

  • Feb 6th: What Happened To Bay Area Real Estate In January?

  • Jan 30th: Layoffs + Bay Areas Experiencing Biggest Price Drops And Gains

  • Jan 22nd: Which Bay Area Cities Are Selling In Under 30 Days?

  • Jan 16th: Is The Market Showing Signs Of Waking Up?

  • Jan 9th: Bay Area Monthly Update + 2023 Outlook

  • Dec 26: San Mateo & Santa Clara County City Comparisons

  • Dec 18th: Did The FED Just Kill The Bay Area Real Estate Market?

  • Dec 10th: What Happened To My Home Value? (San Mateo, Foster City, Redwood Shores)

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