As the year begins, people have been asking me what I think is on the horizon for 2016. A good way to stay up to date on real estate patterns in San Francisco is by checking the SFhotlist weekly market updates. This week I'll answer your questions about the 2016 San Francisco housing market by sharing three key trends I think we'll be seeing in 2016.
With San Francisco real estate prices increasing steadily--and at times quite dramatically--over the past few years, I think the real estate market will settle down in 2016. Selling prices will most likely continue to slightly increase, but it doesn’t seem like there will be any dramatic dips or spikes. For example, the 2015 median sales price was $1,150,000, which represents a 16% increase over 2014. Meanwhile, 5,152 residential listings sold in 2015, which was a 1% decrease over 2014 and reflected the low inventory we were seeing. These statistics point to early signs of stabilization in the San Francisco real estate market.
These stats are for San Francisco County per MLS and include residential property (all single family homes and condos/coops/TICs/lofts) for districts 1-10 (all of SF) in 2015.
2015 saw a 16% increase in the median sales price at $1,150,000. This is down very slightly from a 17% increase the year before. These trends indicate that buyer demand will remain strong. We can expect homes to continue to go for over asking, like they did in 2015, but we'll probably be seeing a slight decrease in the amount over asking the homes sell for.
Buyer demand will be strongest in San Francisco neighborhoods that have been trending for listings sold. Expect neighborhoods like Bernal Heights, Noe Valley, Inner Mission, and the Inner Sunset to continue to be San Francisco housing market hot spots!
If the number of listings sold continues to increase, inevitably, this will affect sales prices and days on market. I'm thinking, like I said, stabilization not contraction. However, when the SF real estate market softens, it tends to become more Darwinian...the best listings in the best neighborhoods will continue to thrive while properties with some sort of imperfection will see more of a change in market conditions. In seller’s markets, buyers are quite “forgiving.” As the market balances, they become pickier.
Ultimately, a balanced market works more fairly for both buyers and sellers. If you’ve been on the fence about selling, or wondering if 2016 is the time for you to buy, give me a call - we can discuss the best strategy for you!
-DL
