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The Data-Driven Realtor – Leveraging advanced analytics, I provide a proprietary scattergram analysis to give you unparalleled insights into your specific home or market, ensuring every decision is data-backed and strategic.
Home Renovation Advisor – Whether you're planning a high-end renovation or managing contractor relations, I'm here to guide you with expert advice to maximize your investment and streamline the process.
Exclusive Off-Market Access – I proactively search for hidden opportunities, knocking on doors and making personal calls each week to uncover off-market properties that meet your unique criteria.
Financial Strategist – With over 20 years of experience in real estate investing, lending, and rehabbing, I specialize in navigating financing and tax strategies to help clients secure favorable rates, increase profits, and preserve wealth for themselves and beneficiaries.
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Executive Summary
In September 2024, there was a change in the SF Bay Area real estate trends, benefiting buyers more than in August, with a rise in inventory and a slight drop in prices. Sellers experienced a relaxation of the constraints they faced, often referred to as "golden handcuffs," due to mortgage rates returning to a more favorable range. As a result, the median price for single-family homes fell to $1.24 million, a 1.6% year-over-year decrease. While buyers had more options, sellers in high-demand areas like San Mateo and Santa Clara counties remained in a strong position, with median prices still hovering around $1.9 million, respectively.
The condo market also softened, particularly in San Francisco where median prices dropped by 3% from August, settling around a median sales price of $1.25 million.
What will October market look like? As the FED interest rates show signs of easing and if tech layoffs slow, October's outlook points to a potential rebound in competition.
KEY TAKE AWAYS...
SALES PRICES? A slight dip occurred in median home prices, especially in counties like Alameda and Contra Costa. However, certain zip codes and cities did well, e.g. Santa Clara's ZIP code 95051 experienced a 7.1% rise, bringing the average home price to $1.8 million. San Jose also had multiple ZIP codes reporting price gains, such as 95132, where prices rose by 7% to $1.6 million. The sales prices for single-family homes in San Mateo county decreased by approximately 5% year-over-year. However, condos and townhomes saw a small increase in value, with prices rising by about 1% compared to the previous year.
SALES VOLUME? As we head into the winter, the SF Bay Area typically slows down in the volume of sales for the remainder of 2024.
MORTGAGE RATES? September was the lowest month on record while the last few days in October rates rose to 6.53%.
Is now a good time to sell or buy?
For well-marketed and well-priced homes, expect multiple offers.
Many sellers and buyers are expected to make the most out of October and early November before the holidays.
Check out two of my blogs for how to sell your home in a high interest rate environment and 6 key questions to ask when selling your home in 2024.
Off Market Properties:
San Mateo (Aragon) (2,870 sqft) - 3 bed, 2.5 bath, 2-car garage
San Mateo (San Mateo Knolls) (2,300 sqft) - 4 bed, 3 bath, 2-car garage
San Mateo (Beresford) (1,100 sqft) - 3 bed, 1 bath, 1-car garage
San Mateo (4 PLEX) - Two 1 bed, two studios
Santa Cruz (East) - (2,100 sqft) 4 bed, 5 bath, 1-car garage on oversized lot
San Francisco (Candlestick Point) - (800 sqft) 1 bed, 1 bath, condo
....
Want the full list? Feel free to reach out directly to me (650.451.8763).
Table of Contents:
How Are The San Francisco Bay Area Real Estate Markets?
Overall, the real estate market in the SF Bay Area indicates a third consecutive monthly decline in sales prices in September. This could be attributed to various factors, including decreased interest rates prompting more sellers to put their homes on the market, concerns and uncertainties related to the upcoming election season, and exaggerated expectations surrounding Artificial Intelligence, all potentially impacting sales prices negatively.
What could improve or increase home prices? Decreased inventory, lower mortgage rates, along with reduced "work from home" mandates as workers now need to be closer to their offices again.
The below graphics shows all five counties' and the *Mid-Peninsula's pending sales organized by home types and price levels. The price tiers under each home type that saw the highest volume of pending sales per county are highlighted in yellow, e.g. Alameda county sells the most condos at price points less than $800K, single family homes and townhouses between $800K to $1.3M.
*Mid-Peninsula = Atherton, Belmont, Burlingame, Foster City, Hillsborough, Menlo Park, Palo Alto, Portola Valley, Redwood City, Redwood Shores, San Carlos, San Mateo, and Woodside.
SF Bay Area Real Estate Trends - Month over Month (MoM)
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 highlighted cells indicate items keeping prices up in comparison to previous month's metrics.
Red highlighted cells indicate the opposite, i.e downward pressure on sales price which favor Buyers more.
(Click on each county's data to make larger). Make county / location bigger to see the MoM data better.
When we look at the $500K pricing tiers starting at $800K, we see that the higher-priced tiers have experienced the greatest increase in volatility per square footage since January.
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.
Inventory - 20 Years vs. 10 Years
Every year we see active and sold inventory go up then down, a predictable cadence. How high or low is dependent on the next metric, Months of Inventory or the rate of change in inventory being sold.
We are above historically low inventory levels; active inventory is now exceeding 2023 levels.
The graphs below show both a 20-year and 10-year time horizon for both single family homes and condos that are on the market (active) or sold.
Months of Inventory - 20 Years vs. 10 Years
This metric tells us how hot the markets are currently, i.e. the rate of change. If no new listings were added, this metric tells us how long it would take to sell all the remaining active homes. Five to six months is considered a buyer's market, three to six is a neutral market, and anything less than three is a seller's market. In the last 10 years, we have been in a Seller's Market except for condos in the year of 2020, when the COVID Pandemic hit.
% Over Asking vs. DOM - 12 Months Look Back
How much over asking a home sold for and how fast it was sold, i.e. Days On Market are the next two Key Performance Indicators (KPIs). These show how much demand there is for SF Bay Area single family homes and condos.
Sales price to list price peaked in April 2024 for single family homes and condos while days on market bottomed in May at 16 days and have been increasing. Despite these latest trends, the average days on market are below 30 days and sales prices going over asking clearly indicate a strong seller's market.
Sales Price - 20 Years vs. 10 Years
In general, single family home prices have doubled every 10 years in the SF Bay Area since the 1980s. Due to the strength of the SF Bay Area economy, we anticipate these values to remain high, especially as inventory levels are still near historic lows and our geographical constraints on building more homes.
However, condos sales prices have been fairly stagnant over the last few years as most home owners are wanting more space.
Prices are hitting a seasonal lull currently but we anticipate these to go up with the low interest rates and companies demanding workers to return to the office. In the past three years, there was a peak in pricing during the summer of 2022 and the spring of 2024.
Please reach out to schedule your free consultation to discuss your home price or home search.
Mortgage Rates & The Stock Market
Inflation: Another month closer to the FED's directive to achieve 2% inflation.
Employment: "U.S. job gains increased by the most in six months in September and the unemployment rate fell to 4.1%, pointing to a resilient economy." (-Reuters). September also saw layoffs in the tech sector at the lowest on record in the last 18 months.
FED rate: The CME Group is predicting the FED to LOWER interest rates again at their November 7th, 2024 meeting.
10 Year Treasury rate: Considered a marker for investor confidence in the U.S. economy, yields are moving up which puts upward pressure on mortgage rates in the short term.
Mortgage rates: September saw the lowest rates in over two years. First few days of October though, rates shot up from 6.26% to 6.53% for a 30-year fixed mortgage due to the recent strong employment and inflation reports.
At KPeterson.realty, we know not every lender is created equal and we work with lenders who's rates today are around 5.25% for 10/6 ARMS. Our lenders also may value your RSUs better than others. Reach out and tap into our network.
Stock market: The S&P500 and most tech stocks are up year to date but the summer saw a pull back and flattening of stock price increases.
When will the next Recession occur? Check out my infographics in this blog post for a brief primer. Then we can discuss over our next coffee.
How We Help Our Buyers
We work with the best lenders who are able to beat the current interest rates (some as low as 5.25% on a 10/6 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.
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If you'd like a more specific valuation of your home, give me a call.
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