Pacific Union’s October 2016 Real Estate Update

The first month of the fourth quarter was a typically busy time for Bay Area real estate markets, with the months’ supply of inventory (MSI) declining or holding steady from September across the majority of Pacific Union’s regions. The exceptions were the Mid-Peninsula and Napa County, where the number of single-family homes for sale increased slightly, and the Lake Tahoe/Truckee region, where more sellers listed their properties in advance of the upcoming ski season.

Click on the image accompanying each of our regions below for an expanded look at local real estate activity in October.

MARIN COUNTY

The number of homes for sale in Marin County declined on both a monthly and yearly basis, ending October with a 1.4-month supply of inventory. At $1,249,000, the median sales price wasn’t far off from the preceding eight months.
Homes sold in an average of 49 days, one day longer than in August and September, and buyers paid 98.2 percent of original prices.
Defining Marin County: Our real estate markets in Marin County include the cities of Belvedere, Corte Madera, Fairfax, Greenbrae, Kentfield, Larkspur, Mill Valley, Novato, Ross, San Anselmo, San Rafael, Sausalito, and Tiburon. Sales data in the adjoining chart includes single-family homes in these communities.

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SAN FRANCISCO – SINGLE-FAMILY HOMES

The median sales price for a single-family home in San Francisco hit a yearly high in October, closing out the month at $1,410,000. Sellers took home 103.6 percent of original prices, a bit less than in September.
At an average 28 days on the market, homes sold almost two weeks faster than they did in the preceding month, while the MSI fell to 1.7.

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SAN FRANCISCO – CONDOMINIUMS

The median sales price for a San Francisco condominium has stabilized over the past year and finished October at $1,164,000. Properties have been commanding premiums for the past year and that trend continued in September, with condominiums selling for 102.2 percent of asking prices.
Month over month, the MSI inched down to 2.7 but was up from October 2015. The pace of sales quickened for the second month in a row, with units taking 37 days to leave the market.

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SILICON VALLEY

Although Silicon Valley is still the Bay Area’s most expensive real estate market, the median price relaxed on both a monthly and annual basis to $2,610,000. The MSI declined to 1.6, down on a monthly and yearly basis.
Homes sold in an average of 39 days, more than double the amount of time from one year earlier. Buyers paid 96.9 percent of original prices, the seventh consecutive month that homes have sold for less than 100 percent.
Defining Silicon Valley: Our real estate markets in the Silicon Valley region include the cities and towns of Atherton, Los Altos (excluding county area), Los Altos Hills, Menlo Park (excluding east of U.S. 101), Palo Alto, Portola Valley, and Woodside. Sales data in the adjoining chart includes all single-family homes in these communities.
Mid-Peninsula Subregion
With a 1.4-month supply of inventory in October, the number of homes for sale in our Mid-Peninsula subregion was consistent with levels recorded for most of 2016. Although the pace of sales has been slowing somewhat, homes still found a buyer in exactly four weeks.
The median sales price increased modestly from September to $1,662,500. Buyers paid 96.1 percent of asking prices, the first month in at least a year with no average premium.
Defining the Mid-Peninsula: Our real estate markets in the Mid-Peninsula subregion include the cities of Burlingame (excluding Ingold Millsdale Industrial Center), Hillsborough, and San Mateo (excluding the North Shoreview/Dore Cavanaugh area). Sales data in the adjoining chart includes all single-family homes in these communities.


Article and images sourced from http://blog.pacificunion.com/pacific-unions-october-2016-real-estate-update/

Pacific Union August 2016 Real Estate Update

Although annual home price appreciation continued to moderate throughout much of the Bay Area as summer drew to a close, two of our second-home markets - Sonoma Valley and Lake Tahoe/Truckee - enjoyed gains of more than 20 percent. Our two most expensive markets, Silicon Valley and the Mid-Peninsula, saw prices move in the opposite direction, with the median sales price down from August 2015. Click on the image accompanying each of our regions below for an expanded look at local real estate activity in August.

SAN FRANCISCO - SINGLE-FAMILY HOMES   The median sales price for a single-family home in San Francisco dropped to $1,281,500 in August, the lowest since January. Homes took an average of 34 days to find a buyer, a slight increase from the two preceding months. The MSI ended August at 1.6, with sellers netting 107.6 percent of asking prices.     SAN FRANCISCO - CONDOMINIUMS   Condominium sales in San Francisco slowed as summer wound down, with homes selling in an average of 50 days, the longest time on the market in the past year. The median sales price was $1,099,118, virtually unchanged from July. Even as the pace of sales slowed, supply conditions tightened, with the MSI dropping to 1.8. Sellers took home an average of 100.7 percent of original prices, the smallest premiums recorded over the past 12 months.     MARIN COUNTY   August's median sales price in Marin County was nearly unchanged from July at $1,187,500. The MSI ended the month at 1.8, also almost identical to July. Homes sold in an average of 47 days, and buyers paid 96.4 percent of original prices.     Defining Marin County: Our real estate markets in Marin County include the cities of Belvedere, Corte Madera, Fairfax, Greenbrae, Kentfield, Larkspur, Mill Valley, Novato, Ross, San Anselmo, San Rafael, Sausalito, and Tiburon. Sales statistics in the chart above include single-family homes in these communities.     SILICON VALLEY

 

Summer's end also found the pace of sales slowing in our Silicon Valley region, with homes taking an average of 44 days to leave the market. The MSI stood at 1.9, down slightly from July. At $2,500,000, the median sales price declined 9 percent from August 2015, tying its one-year low. Buyers also enjoyed the biggest discounts of 2016, with homes selling for an average of 96.6 percent of original prices.     Defining Silicon Valley: Our real estate markets in the Silicon Valley region include the cities and towns of Atherton, Los Altos (excluding county area), Los Altos Hills, Menlo Park (excluding east of U.S. 101), Palo Alto, Portola Valley, and Woodside. Sales statistics in the chart above include all single-family homes in these communities.   MID-PENINSULA SUBREGION   The median sales price in our Mid-Peninsula subregion was down on both a monthly and yearly basis, closing out August at $1,475,000. The pace of sales remained brisk, with homes finding a buyer in an average of 22 days. The MSI dipped slightly from July to 1.3, and sellers received 101.1 percent of original prices.     Defining the Mid-Peninsula: Our real estate markets in the Mid-Peninsula subregion include the cities of Burlingame (excluding Ingold Millsdale Industrial Center), Hillsborough, and San Mateo (excluding the North Shoreview/Dore Cavanaugh area). Sales statistics in the chart above include all single-family homes in these communities. Article and images sourced from http://blog.pacificunion.com/pacific-unions-august-2016-real-estate-update/

Pacific Union’s July 2016 Real Estate Update

Normalizing annual home price growth was evident across parts of the Bay Area in July, with the median single-family home price in Contra Costa County, the East Bay, San Francisco, Silicon Valley, and Sonoma County rising by single-digit percentage points from one year earlier. Only single-family home prices in the Lake Tahoe region and Marin County posted double-digit percent annual appreciation. Price growth was flat in Napa County, while prices fell year over year in our Mid-Peninsula and Sonoma Valley regions.

Click on the chart accompanying each of our regions below for an expanded look at local real estate activity in July.

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MARIN COUNTY

The pace of sales in Marin County slowed in July, with homes taking 46 days to sell, more than a week longer than in the previous month. The median sales price softened slightly from June to $1,186,000 but was up by 12 percent from July 2015.

The MSI closed July at 1.6, and buyers paid 98.3 percent of original prices.

Defining Marin County: Our real estate markets in Marin County include the cities of Belvedere, Corte Madera, Fairfax, Greenbrae, Kentfield, Larkspur, Mill Valley, Novato, Ross, San Anselmo, San Rafael, Sausalito, and Tiburon. Sales data in the adjoining chart includes single-family homes in these communities.

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SAN FRANCISCO – SINGLE-FAMILY HOMES

The median single-family home price in San Francisco ended July at $1,370,000, in the same general range as it has been since February. Homes continue to fetch premiums, selling for 105.9 percent of original prices, although overbids are substantially smaller than they were last summer.

Homes sold in an average of 32 days, nearly identical to June’s pace of sales. The MSI finished July at 1.8, with a few more homes on the market than in the previous month.

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SAN FRANCISCO – CONDOMINIUMS

San Francisco’s median condominium price cooled slightly on both an annual and monthly basis, dropping to $1,080,000 in July. Buyers paid 102.7 percent of original prices, a bit less of a premium than they did last summer.

Both the average days on market and the MSI remained unchanged from June, at 36 and 2.1, respectively.

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SILICON VALLEY

The median sales price in our Silicon Valley region has been gradually dropping since April, but at $2.8 million it remains the most expensive region in which Pacific Union operates. Still, buyers netted slight discounts for the fourth consecutive month, with the average home selling for 98.8 percent of original price.

The MSI rose to 2.0, its highest level since March, and homes sold in an average of 26 days.

Defining Silicon Valley: Our real estate markets in the Silicon Valley region include the cities and towns of Atherton, Los Altos (excluding county area), Los Altos Hills, Menlo Park (excluding east ofU.S. 101), Palo Alto, Portola Valley, and Woodside. Sales data in the adjoining chart includes all single-family homes in these communities.

Mid-Peninsula Subregion

After dropping significantly in June, the median sales price in our Mid-Peninsula subregion rebounded in July to $1,640,000, although it was down on an annual basis. Sellers received 103.7 percent of asking prices, not dramatically different from the previous three months.

Homes took an average of 19 days to find a buyer — identical to June — while the MSI rose modestly to 1.4.

Defining the Mid-Peninsula: Our real estate markets in the Mid-Peninsula subregion include the cities of Burlingame (excluding Ingold Millsdale Industrial Center), Hillsborough, and San Mateo (excluding the North Shoreview/Dore Cavanaugh area). Sales data in the adjoining chart includes all single-family homes in these communities.

Article and images sourced from http://blog.pacificunion.com/pacific-unions-july-2016-real-estate-update/

Beyond the Clouds: Economic Sun Rays Continue to Keep the Bay Area Warm

The U.S. Economy Is Solidly Marching Forward

To say that we live in the age of information overload is an understatement. If you are not entrenched in economic data, it may be difficult to see the forest from the trees by reading daily news stories. However, after a shaky start to this year, we can now say with some level of certainty that we are on the other side of the tumultuous tunnel and that the economic prospects for 2016 are looking up.

The encouraging signs are both national and international. Nationally, it’s all about jobs. Job growth continues at an exceptional pace; according to the latest U.S. Labor Department survey on new jobs and turnovers, more people — 5.4 million — got a new job in February than in any month since before the recession. Also, we are finally seeing broader improvements in wages, which drive consumption and the service sector. Consequently, industries and companies relying on domestic consumers are doing well.

Businesses affected by a strong dollar and weaker international demand are not doing as well. Internationally, however, the storm has finally subsided. Better news is coming from U.S. trading partners, and oil prices seem to have stabilized. Emerging markets appeared to have weathered the storm, and capital volatility seems to be settling down.

The Bay Area Is the Job Dynamo

The Bay Area has been the shining star in the nation’s economic recovery. The region’s economic strength originates from the exceptional job growth over the last four years, and the Bay Area still outperforms the rest of the country. Over the past year, some 120,000 jobs were created locally, most in technology and other high-income sectors. An important advantage to tech-sector jobs is that they have a high multiplier rate, meaning that their economic spillover to local economies is higher than most other types of jobs. Job growth has also been the impetus for the remarkable housing-market recovery and the ensuing home price appreciation that we have seen across the region.

Jobs are critical to Bay Area housing markets, and growth is still happening. In fact, 2015 was the strongest year of regional job growth since the recovery started. And while 2016 started slower, it still may be the second-best post-recession year if hiring continues at its current pace.

However, the theme that permeates all sectors of the economy is normalization, a natural part of economic cycles. Normalization reflects that markets are maturing and relieves the fears of frothing that have recently concerned many.

Another critical component to the Bay Area’s economy is that it is an innovation hub and relies heavily on venture capital (VC). While 2015 was the strongest year of investment dollars coming into Silicon Valley since the dot-com collapse, the drop in investments in the last quarter of the year caused some concerns over future availability of venture funds. Various reports, however, suggest no lack of VC activity, and some even show that VC firms are raising money at the highest rate in more than 15 years.

Interestingly, though, VC activity is spreading geographically, and the Bay Area lost some of its edge coming into 2016. A recent survey of technology and life-sciences executives in the Bay Area indicates that capital is tightening and that funders are in search of a more balanced environment, with a focus on fundamentals. Investors are focusing on startups in more mature stages of development. This may be a good thing, as it removes some of the volatility in expectations. And while overall expectations are going through a short-term readjustment, the survey suggests that the optimism among the executives about the long-term future of innovation is still strong.

Did the Stock Market’s Volatility Leave a Bad Taste With Consumers?

Given the first-quarter stock-market and economic volatility and fears on its impact on housing markets, we surveyed Pacific Union real estate professionals to gauge how these changes are impacting their clients’ decisions to buy or sell a home.

Overall, clients’ decisions to buy or sell a home were only modestly more influenced (55 percent) than not (45 percent) due to first-quarter volatility. Furthermore, a limited share of clients (19 percent) make decisions to buy or sell a home based the rate of venture-capital investment. Only a very small share — 5 percent — of clients completely exited the housing market due to volatility.

With the majority of buyers and sellers employed in the tech industry and given the large impact that IPOs can have on local housing markets, it is also interesting to see what share of clients actually worked for a startup that recently went public. On average, about 10 percent of clients worked for such a startup. Half of the Pacific Union professionals who responded didn’t have any clients in the IPO world, and a quarter had at least 20 percent or more.

Yet, stock options, with or without an IPO, did not have a marked impact on how most recent transactions were financed. Almost two in five transactions were all-cash deals, where personal and family wealth, along with proceeds of previous real estate sales, were the major sources of cash (see Figure 1). Stock options were the source of money in only 1 percent of all-cash transactions (see Figure 2).

Of buyers with a mortgage, about one-third of down payments came from savings, another quarter from personal wealth, and another fifth from proceed of previous real estate sale. Family wealth helped in 13 percent of transactions. Stock options and IPOs contributed to down payments in only about 7 percent of mortgaged transactions.

All in all, however, the majority of Pacific Union clients feel optimistic about the Bay Area housing market in 2016 (54 percent), with somewhat a smaller share feeling some concern (44 percent). Very few — 2 percent — feel pessimistic.

Figure 1: How was the most recent transaction financed?

Figure 2: Where did the funds come from in all-cash and mortgaged transactions?

What’s Ahead for the Housing Market?

There has certainly been some adjustment of expectations in the market. Overall, the Bay Area continues to experience the highest price appreciation in the country. In some submarkets, prices are still growing at double-digit percentage points on an annual basis.

Sales, however, face challenges, in large part due to an ever-slimmer number of homes on the market. The housing  picture is not uniform across the region, and affordability seems to play a large role. When compared with last year, sales have dropped the most in the areas with the highest prices, while other more affordable areas have seen sales increase. Buyers appeared to have grown weary of the competitive market and are not pursuing purchases as aggressively. The median time that homes last on the market has extended a little longer when compared with last year in some expensive places such as San Francisco and Marin County. Similarly, the escalation of sales prices over the initial listing prices is slowing, and buyers are exercising more caution when entering bidding wars.

Pacific Union sales numbers show similar trends as the overall market. After falling activity in January and February, March was encouraging, with sales slightly up from last year. Over the past 30 months, Pacific Union listings peaked in March 2015 at 417 and are currently 13 percent below that.

The lack of homes for sale stands as the biggest obstacle for the busy spring season. In all Bay Area regions in which Pacific Union operates, the number of homes for sale is down from the same time last year, with the largest declines in the areas north of San Francisco and in the East Bay — 15 percent and 13 percent respectively. San Francisco and the South Bay have seen about 3.5 percent declines in homes for sale.

Limited inventory combined with strong job growth will continue putting pressure on prices in the second quarter of 2016, though the appreciation may be more subdued than in past quarters. As noted earlier, normalization will permeate housing markets, and appreciation rates will slow to lower single-digit numbers. Any remaining uncertainty in the market will stem from the upcoming presidential election and continued geopolitical risks that could unsettle the positive consumer sentiment that has been building with a better job market and wage growth.

Article and images sourced from http://blog.pacificunion.com/beyond-the-clouds-economic-sun-rays-continue-to-keep-the-bay-area-warm/

7 Gorgeous Post-Storm Hikes in Marin County

Breath taking vista from the Coastal Trail above Muir Beach. (Photography by Sarah Hawthorne)

According to our iPhones, San Francisco is supposed to get a brief reprieve from the rain this week, and temperatures may even get into the high 60s. Treat yourself to a little sunshine after the storm on one of these gorgeous Marin hikes. Champagne optional, but recommended. 

The Coastal Trail

The Coastal Trail from Tennessee Valley to Muir Beach (or vice versa) boasts some of the most spectacular views of both the Pacific Ocean and the Marin Headlands. The trail winds around the top of dramatic cliffs (filling you with the urge to quote Titanic) and dips down so you can hear the roaring ocean below. Keep your eyes peeled for majestic hawks circling above your head.

Muir Woods 

The famous Muir Woods National Monument is one of the last remaining old-growth redwood forests in the Bay Area. Enjoy the giant coastal redwoods trees in all their glory with a beautiful walk along one of the many trails that winds around the valley. Avoid the crowds by parking on Panoramic Highway opposite the Mountain Home Inn and hike your way down into the valley floor via the Ocean View or Lost Trail from the Panoramic Trail. Or park on the ocean side of Panoramic Highway, precisely where it meets the famous Dipsea Trail, and hike the Dipsea down to the official park entrance.

Seven Sisters

Sitting pretty atop Mt. Tam State Park is one of the most beautiful stretches of road you will ever see. When the fog burns off, you can see all the way to Bolinas and Stinson Beach. Take a scenic drive, a vigorous bike ride, or a peaceful hike in the spot where pretty much every car commercial ever was filmed. 

Stinson Beach

Prefer your views with a little less effort? Park your car at Stinson Beach and walk along the shoreline with your toes in the sand. Arrive first thing in the morning to beat the crowds and embrace the gentle sunshine of the early hours. The rolling hills of Marin make for a scenic backdrop as you watch seals and even dolphins play in the water around you. Relax at the Parkside Café afterwards for a refreshing drink and bite to eat. 

East Peak 

Pack your lunch and refreshments, sit for a while, and soak up the impressive 360-degree views East Peak has to offer. Feel free to take plenty of photos — its worth showing off to your Instagram followers.

Hawk Hill

Want to see the San Francisco skyline at its best? Take a short drive from the city up Hawk Hill and enjoy stunning views of the Marin headlands, Golden Gate Bridge, San Francisco Bay, and the City. By day, Hawk Hill is a great place to watch ships sail under the GGB. By night, there is an amazing display of city lights and the illuminated bridge, perfect for ending a romantic date with someone special (don't forget the bubbles!).

Muir Overlook 

Muir Overlook is a lovely little spot perched above Muir Beach just off Hwy 1. The bluff showcases stunning coastal views for miles in both directions. Pack a picnic to make this little outing extra special. On your way back to San Francisco, stop by the Pelican Inn for a taste of the English Countryside in this quaint little pub.

Article and images sourced from http://www.7x7.com/marin/7-gorgeous-post-storm-hikes-marin-county

Pacific Union's February 2015 Real Estate Update

The pace of residential real estate sales picked up throughout most of Pacific Union’s Northern California regions in February, with homes selling in fewer days than in the previous month in every market except for Napa County and Lake Tahoe/Truckee.

Median sales price trends varied by region, but prices for condominiums in San Francisco hit a one-year high. Single-family home prices decreased a hair from January in our Silicon Valley region, but they remained near the $3 million mark.

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MARIN COUNTY

The median sales price in Marin County has relaxed a bit each month since November and closed February at $980,000. The MSI followed suit, dropping to 2.1.

Homes sold in an average of 57 days, five days faster than in the preceding month. Sellers received about 99 percent of original price, the most since May 2014.

Defining Marin County: Our real estate markets in Marin County include the cities of Belvedere, Corte Madera, Fairfax, Greenbrae, Kentfield, Larkspur, Mill Valley, Novato, Ross, San Anselmo, San Rafael, Sausalito, and Tiburon. Sales statistics in the adjoining chart include single-family homes in these communities.

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SAN FRANCISCO – SINGLE-FAMILY HOMES

As has been the case for most of the past year, single-family homebuyers in San Francisco paid in excess of $1 million in February — $1,133,000 to be exact. Successful buyers forked over an average of about 12 percent more than original price, the highest premiums in any of Pacific Union’s regions.

At 1.9, the MSI was unchanged from January. Single-family homes in the city left the market in 30 days, in line with the general pace throughout most of 2014.

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SAN FRANCISCO – CONDOMINIUMS

At $1.1 million, the median sales price for a San Franciscocondominium climbed to a yearly high. Sellers reeled in an average of 7 percent above original price, the most since last summer.

Properties sold in an average of 28 days, roughly twice as fast as in December and January. The MSI tightened a bit from the previous month to finish February at 1.8.

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SILICON VALLEY

With February’s median sales price at $2.8 million, homes in our Silicon Valley region are selling for about 21 percent more than they were a year ago. And while the region saw a supply spike last February, that didn’t happen this year, and the MSI fell to 1.7.

Buyers took an average of 26 days to close a transaction — two weeks quicker than they did in January — and paid about 6 percent more than original price to make it happen.

Defining Silicon Valley: Our real estate markets in the Silicon Valley region include the cities and towns of Atherton, Los Altos (excluding county area), Los Altos Hills, Menlo Park (excluding east of U.S. 101), Palo Alto, Portola Valley, and Woodside. Sales statistics in the adjoining chart include all single-family homes in these communities.

Mid-Peninsula Subregion

At $1.53 million, the median sales price for a home in Pacific Union’s Mid-Peninsula subregion was down from January but up about 18 percent from a year ago. Successful buyers paid nearly 3 percent more than original price, an uptick from the previous month.

Homes left the market in an average of 32 days, identical to numbers recorded in February 2014, while the MSI declined to 1.8

Defining the Mid-Peninsula: Our real estate markets in the Mid-Peninsula subregion include the cities of Burlingame (excluding Ingold Millsdale Industrial Center), Hillsborough, and San Mateo (excluding the North Shoreview/Dore Cavanaugh area). Sales statistics in the adjoining chart include all single-family homes in these communities.

Article and Photos sourced from:  http://blog.pacunion.com/pacific-union-february-2015-real-estate-update/