San Francisco News
San Francisco sees heightened home prices, increased demand in early 201426 Mar 2014 1:04 PM
Following the substantial growth observed within California housing markets during the final months of 2013, it came of no surprise to many that Golden State home values continued to tick higher throughout the first couple months of 2014. So far this year, a significant amount of real estate transactions have been completed across the state, and sale prices for these properties have risen considerably.
One residential segment in particular - San Francisco - has seen the bulk of recent housing activity, as this upscale metropolitan area is home to some of the country's most successful business leaders, luxurious estates and affluent individuals. If you currently own a home within the City by the Bay, or are planning to acquire one in the coming months, time may be of the essence, as current conditions are largely favorable and could see even more sizable increases in the near future.
San Francisco home prices continue to rise
At the start of the year, the Bay Area's housing market was poised to resume the upward trajectory that had been observed in previous months. During January, the city's sales exhibited notable price increases on both monthly and yearly bases, according to S&P Dow Jones Indices. Within its most recent S&P/Case-Shiller Home Price Index, the organization reported that San Francisco's residential sector was once again the site of significant improvement during the recent month, showing an uptick of 0.5 percent from December's level. This marked a year-over-year gain of 23.1 percent and pointed toward the potential for even higher figures to be recorded in subsequent months.
David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, proposed that these recent numbers suggest future increases in the following months, as such significant annual growth is likely to have lasting effects on the housing market.
"Expectations and recent data point to continued home price gains for 2014," Blitzer said. "Although most analysts do not expect the same rapid increases we saw last year, the consensus is for moderating gains. From the bottom in 2012, prices are up 23 percent and the housing market is showing signs of moving forward with more normal price increases."
Not only are home prices up throughout the City by the Bay, but many listings are well above the million-dollar mark - in fact, there are more here than any other high-end housing market nationwide. According to Trulia, single-family properties priced at or above $1,000,000 account for 43.5 percent of the area's residential sector. However, much of these prices can be attributed to homes' locations, various features and quality, as the median size of these manses is just 1,774 square feet.
City's condominium market remains hot through February
Though some individuals prefer to purchase lavish single-family homes in residential neighborhoods outside of the city's center, others choose to buy sophisticated condominiums that afford them all the luxuries of a private residence, but the convenience and cosmopolitan charm of living within a metropolitan area. Due to San Francisco's coastal location, prime weather patterns and high-end offerings, this segment has seen a sizable uptick in activity during past months.
According to a recent report from The Mark Company, a local real estate marketing and sales firm, sale prices for newly built condominiums in the City by the Bay climbed 15 percent year-over-year to an average of $1,027 per square foot during February. Prices for existing condominiums also showed growth, as the average price per square foot for units being resold was $864, up 21 percent on an annual basis.
These developments in buyer demand have served to substantially reduce the amount of available properties that are listed on the local market, the report showed. At the end of February, San Francisco had a condominium inventory supply of just one month.
Statewide housing sector also showing signs of strength
In addition to the City by the Bay, the entire state of California exhibited substantial housing gains in early 2014.
According to the latest Home Price Index report released by CoreLogic, the Golden State's market for upscale single-family homes recently experienced considerable increases both month-over-month and year-over-year. Earlier this year, single-family homes within the West Coast state rose 1 percent from prices logged at the end of 2013, which pointed toward an annual rise of 20.3 percent. This pushed Californian housing markets to within 20.6 percent of the peak amounts recorded during May 2006, adding to the growing sentiment among residents and homeowners that the state is still on the right path toward recovery and the notion that higher sale amounts will be seen in the coming months.
"Home prices continued to march higher in January and we expect to see more increases as the market comes out of hibernation for the spring buying season," said Anand Nallathambi, president and chief executive officer of CoreLogic. "Excluding distressed sales, all 50 states and the District of Columbia showed year-over-year home price appreciation for January."