Because I sell real estate, I get asked every day how the market is doing, and when I respond that the luxury market in San Francisco is still very active, people are often surprised — especially in the last few months. Everything you see on TV or in the news is very gloomy when it comes to real estate, especially if you watch the business channels (I hope none of my readers had stock in Citigroup!) But the numbers don’t lie. First Republic Bank just released their quarterly report on the market, and had this to report:
San Francisco Bay Area Values
“San Francisco Bay Area values increased 2.6% from the second quarter of 2007 and were up 3.9% from the third quarter of 2006. The average luxury home in San Francisco is a record $3.08 million.”
“San Francisco Bay Area values were the strongest in the state. The average luxury home in the San Francisco Bay Area exceeded $3 million for the second quarter in a row. The market, particularly in San Francisco’s close-in North Bay and Peninsula communities, is showing surprising strength.
Agents said values were firm in San Francisco, Silicon Valley and Marin County, but were beginning to slip in the East Bay. “We have a relatively bulletproof market in the upper end in San Francisco,” said Tom Cooke of TRI Coldwell Banker in San Francisco. “There’s never enough inventory to satisfy buyer demand in the city. The difference this year is that two or three people are moving on homes for sale, compared to five or six people last year. There is no softening of prices.”
On the Peninsula, the market was slower due largely to limited inventory. “Shortage is the name of the game in Palo Alto,” said Steve Tenbroeck of Alain Pinel Realtor in Palo Alto. “We have record low inventory. In the $3 million to $6 million range, demand is slowing because buyers are sensitive to consumer confidence. Below that price range, it is still a seller’s market, with multiple offers and homes selling very quickly.”
In Marin County, values were holding, despite fewer homes for sale. “If the inventory were better, we’d have more sales,” said Tina McArthur of Pacific Union Real Estate of Larkspur. “There isn’t a day that goes by when agents aren’t asking one another whether there are any properties for sale between $3 million to $5 million.”‘
Over at thefrontsteps.com, Alexander Clark reports that sales at Millennium Tower are hitting $2,000 per square foot, and that 60 condos have already been sold in the building, which isn’t due to be occupied until 2009. The 60th floor penthouse just sold for about $12 million.