There is a high level of uncertainty about the economy due to the ongoing COVID crisis, undecided future governmental economic support programs, and upcoming elections. In spite of this uncertainty, the San Francisco real estate market still includes numerous multiple offer situations.
This is partly because there are still plenty of buyers with secure jobs and a desire to live in San Francisco. It’s also because San Francisco still has a structural housing shortage – more buyers than sellers.
Those buyers’ tastes and preferences are shifting due to COVID. There is a desire for more separation from others (for health’s sake) and a need for more activity spaces because many buyers are working from home and/or schooling from home. So numerous buyers are choosing single-family homes over condo/townhomes.
Possibly because of this, single-family homes managed a 0.6% year-on-year price increase in San Francisco, while condo/townhomes showed up with a 4.0% decrease. This was mirrored in the sold price per square foot for each property type, with single-family homes up 1.2% and condo/townhomes down 5.0% annually.
There was also a sharp decline in the number of units sold for both homes and condo/townhomes. Single-family home sales were down 43.5% and condo/townhomes 57.6%.
For the foreseeable future, interest rates are expected to remain at historic lows, which will support prices staying higher than they would at the rates we had pre-COVID.