annie williams 4th quarter 2016 report

san francisco Market recapfourth quarter 2016 report

Annie WilliamsTop 1% San Francisco Realtors415.819.2663awilliams@hill-co.comwww.AnniewilliamsHomes.comBRE License #01393923

home price appreciation over the Last 10 Years Prices for San Francisco single family homes and condos climbed in October, and then fell back in November and December. Single family home values ended the year up in comparison to where they were at the beginning of 2016, while condo values were down a bit overall for the year.

The rate of home value appreciation has slowed since the Spring of 2015, but it might be worth looking back some for perspective on where the market is, and where it has been.

The three charts below help illustrate the point. They depict Median Sales Price for single family homes (in orange) and condos and lofts (in purple).

The chart on the left presents the last five years. In February of 2011, the median price for a single family home in the City was just $621,000. The median price for a condo was $563,500. At the end of December 2016, those figures had increased to $1,315,000 and $1,015,000, respectively.

While property values for much of the rest of the country are just now catching up to their pre-downturn highs, SF values have been climbing dramatically, as the chart for price gains over the last ten years (top right) indicates. With that in mind, the slow down in appreciation that we’ve seen over the past 18 months is not unexpected.Office: (415) 921-6000

[email protected] De Martini (CAL BRE #)Hill & Co.

Each data point is one month of activity. Data is from January 10, 2017.All data from the San Francisco MLS. InfoSparks © 2017 ShowingTime.

Median Sales Price - By Property Type

San Francisco County1-2011 1-2012 1-2013 1-2014 1-2015 1-2016

$0.6M

$0.8M

$1.0M

$1.2M

$1.4M

$1.6M

$0.4M

Single Family Condo & Loft

Office: (415) [email protected]

Garey De Martini (CAL BRE #)Hill & Co.



San Francisco County1-2006 1-2007 1-2008 1-2009 1-2010 1-2011 1-2012 1-2013 1-2014 1-2015 1-2016

$0.6M

$0.8M

$1.0M

$1.2M

$1.4M

$1.6M

$0.4M


Office: (415) [email protected]

Garey De Martini (CAL BRE #)Hill & Co.



San Francisco County1-2015 1-2016

$0.9M

$1.0M

$1.1M

$1.2M

$1.3M

$1.4M

$1.5M

$0.8M


Median sales price over past 5 Years



As the new administration assumes office, a question many homeowners and buyers are asking is, “how will this impact home prices?”

There actually seems to be some consensus among industry executives and analysts on this particular matter. All seem to agree that while some uncertainty exists, some trends and developments appear to be more foreseeable based on current market conditions.

Perhaps it’s worth noting first that Jonathan Smoke, chief economist at Realtor.com, analyzed five presidential elections that took place in the past 20 years and found that they had no consistent impact on home sales or prices - beyond a three-mile radius of Capitol Hill where there was a great deal of turnover as would be expected when administrations change.

Other factors such as economic booms and busts, and interest rates, have had a greater influence.

The trends we’ve noted recently will likely continue unabated. Interest rates will still rise - though remaining low in comparison to where rates have been in the past. Affordability and a low inventory of homes for sale will continue to be major challenges. On the plus side, the fundamentals favor improvement in the housing market, as population and income growth should support housing demand going forward.

The financial markets seem to favor the new administration, which means that the housing market is bound to react in a similar manner. In fact, the National Association of Home Builders announced that confidence among the residential construction sector is at a nine-year high.

That said, a number of analysts are nevertheless simply brushing off the idea of the new administration having a profound effect on the market. This rationale is based on the fact that the housing market should have reacted negatively to the rough and tumble nature of the 2015-2016 political scene. Yet nothing of the sort happened; this can be construed as the housing market operating independently from political sentiment.

the new administration and home prices

fourth quarter home sales By neighborhood*

*Single family homes and condos combined per the San Francisco Association of REALTORS®. Does not include off market sales. These figures present a snapshot of the market to give you a sense of what is taking place. A single home’s value may be higher or lower than what is presented here, and the appreciation or depreciation you see may not apply. For example, median sale price means half the homes in that neighborhood sold under that amount, and half sold over. There can be dramatic differences between the high value and the low value, and the median figure does not show that.

Hard to spot concrete trends in these fourth quarter numbers. Prices were higher in October, and then fell off a bit in November and December for both single family homes and condominiums. The volume of sales increased year over year in November, but decreased in October and December for both property types.

It’s important to keep in mind that these are aggregate figures for the City as a whole. Homes on your block may have sold more or less quickly, for more or less money.

Districts 5, 7 and 8 include some of the City’s pricier neighborhoods - Noe Valley, Pacific Heights, Nob Hill, Russian Hill and the like. We include this chart to give residents in these districts a truer representation of their property values and to provide them with a better picture of the activity that has taken place in their neighborhoods over the past three months.

The prices you see in these neighborhoods are dramatically higher than the prices you see in the City overall, but the trends are typically very similar.

fourth quarter snapshot: all of san francisco

fourth quarter snapshot: Districts 5, 7 and 8

What to expect from chinese Buyers in 2017You may have heard that China’s foreign exchange regulator announced a new policy on January 1, 2017, that affects all individuals who are looking to buy overseas real estate. Chinese citizens will now have to fill out an application form stating the purpose of their foreign purchase.

China is so worried about its falling currency that it is hoping to monitor the purpose of every individual Chinese citizen who is looking to transfer money overseas.

What does this mean in terms of their propensity for U.S. real estate investments? According to a piece written for the real estate news provider Inman.com, the impact may be negligible.

It seems that Chinese investors will continue to find ways around the controls, just as they have done in recent years with less stringent regulations. However, the new restrictions may lengthen the time it takes to complete an overseas property purchase. It may take more than six months to get a close.

Ironically, the new regulations may cause demand for overseas real estate to increase, as the Chinese upper class is getting increasingly nervous about both the currency weakening and tightening restrictions.

Concerned about these same issues, the Chinese middle class is also now interested in investing overseas. However, they will likely focus on second and third-tier U.S. cities.

Listings from around the World

Ono Island, Fiji: 4BD/2BA Offered at $1,495,000

ASIA, AUSTRALIA, AND THE SOUTH PACIFIC

Europe

Caribbean

Arquà Petrarca, Italy: 6BD/4BA Offered at $2,639,486

Turks and Caicos Islands: 4BD/2BAOffered at $1,595,000

Vanua Levu, Fiji: 11BD/11BA Offered at $13,888,000

Mykonos, Greece: 4BD/3BA Offered at $633,477

Dominical, Costa Rica: 5BD/7BA Offered at $3,000,000

Kerikeri, New Zealand: 4BD/4BA Offered at $2,027,099

Moraira, Spain: 5BD/3BA Offered at $3,695,281

San Pedro Town, Belize: 8BD/5BA Offered at $1,499,000

To see more homes like this, visit www.hill-co.com and click on our “International” tab.

annie williams 4th quarter 2016 report

Real Estate