September Slowdown Hits San Francisco Condo Sales
San Francisco’s housing market slowed in September following a busy summer. Condo sales dropped 27% during the month compared to the previous September, according to a study from Pacific Union International Chief Economist Selma Hepp. Condos and homes priced between $2M and $3M were most in demand in September, and 83% of these homes sold for more than the asking price.
Year-to-date sales for condos crept up 1% citywide, while Districts 6 through 9, which include SoMa and the Mission District, reported a 4% increase in year-to-date condo sales. District 7, which includes Park Merced and West Twin Peaks, posted a 15% increase in year-to-date sales — the most among these districts. District 9 (Mission) and District 10 (Bayview Hunters Point) posted flat sales year-to-date even though these areas had a majority of the new condo construction.
Throughout San Francisco, supply is declining at a rapid pace. Existing inventory has been declining 14% each month since March. According to data from The Mark Co., new condo inventory has steadily declined about 28% each month over the last six months. Multifamily deliveries are expected to drop off beginning in 2019 and 2020, which could keep pricing high in the long term.
Ongoing supply constraints will continue to push rents up and condo prices higher, making living in San Francisco unaffordable for many. New condo pricing has stagnated somewhat; it is unclear if this decline will persist, according to Hepp.
A potential influx of residents who lost their homes during the recent Wine Country fires also could increase demand for condos and homes in San Francisco. Marin County has been reporting an influx in Wine Country residents, according to Hepp.