As your local real estate experts, we feel it’s our duty to give you, our valued client, all the information you need to better understand the complex San Francisco real estate market. Whether you’re buying or selling, we want to make sure you have the best, most pertinent information, so we’ve put together this monthly analysis breaking down specifics about the market. It’s all part of our mission to give you the very best in personalized service. We would love to know what you think!
– Anthony Navarro, DRE #01491847
Welcome to our December newsletter. December is typically the slowest month for residential real estate. That’s why, in addition to taking a look at what’s happening in our market, we thought it’d be the perfect time to tell you what sets our team apart from other agents and to explain what benefits you get from working with us to buy or sell a home.
This month we’ll examine:
- Market Update for San Francisco: Home Prices, Month’s Supply, Days on Market, and Sales-to-List Price
- Why Finding the Right Real Estate Agent Is Essential
- Top 5 Reasons We’re the Best Team to Help You Buy or Sell a Home
Market Update for San Francisco
Here’s a snapshot of this month’s housing market in San Francisco across four key indicators: home prices, month’s supply, days on market, and the sales-to-list price.
- Prices for single-family homes and condos have spent much of 2019 above the previous year, with single-family homes up 16%.
- Condo prices ended November in line with last year’s prices.
For single-family homes, appreciating prices signal a healthy demand for housing and should encourage sellers to price their homes slightly above comparables. Sellers should price their condos in line with recent comparables.
- What it means: Month’s supply is a measure of how many months it would take for all current listings on the market (including listings under contract) to sell at the current rate of sales.
- Worth noting: In California’s high-demand market, a “balanced” supply level is three months, which means there are three months of housing inventory on the market at the current rate of sales. Less supply favors the sellers.
It’s a seller’s market. Supply levels are extremely low and tightening further compared to the previous year, giving sellers the advantage of robust demand and rising home prices.
Days on Market
- What it means: The number of days a property has been actively listed on the market.
- Luxury vs. entry-level homes: With fewer buyers for luxury homes, the number of days-on-market is higher for this segment than for entry-level properties.
Sellers of luxury homes should have realistic expectations about how long it will take to sell their property. Days on market declined significantly from a year ago.
- What it means: The sale-to-list price ratio is the difference between the original list price of the home and the final sale price.
- Worth noting: Single-family homes typically have higher sale-to-list price ratios than condos.
Both condos and single-family homes are selling well above their listing price. Both buyers and sellers should be prepared to negotiate prices accordingly.
Why Finding the Right Real Estate Agent Is Essential
Now that we’ve reviewed the state of the market in this area, let’s talk about the importance of working with experienced, motivated, market-savvy real estate agents like the folks on our team.
According to the National Association of Realtors, 89% of buyers and sellers in 2018 used a real estate agent or broker. What did buyers and sellers most expect from the help of an agent? We can look at the charts below.
Let’s start with buyers.
Even with more buyers looking at listings online, the number one service they want from their agent is help in finding the right home (52%). In California, this is especially important because research from the California Association of Realtors shows that housing inventory is the lowest it’s been in 20 years in many parts of the state. Two other important services buyers want from an agent are negotiating the terms of sale (12%) and negotiating price (11%).
Now let’s look at sellers.
In 2018 sellers primarily wanted their agent to help them market their home to potential buyers (21%). Other priorities include selling their home within a specific timeframe (20%) and offering guidance in setting the list price (19%).
Sellers said that agents helped them market their homes in one or more of the following ways.
Top 5 Reasons We’re the Best Team to Help You Buy or Sell a Home
For most of us, buying or selling a home is a significant life event. Buyers and sellers may assume that agents are all the same when it comes to their experience, insights, and market strategy. Unfortunately, this assumption exposes clients to real financial risk (for example, from buying too high or selling too low), not to mention the emotional risk of losing a home if an offer is rejected.
Remember, you’ll likely be interacting frequently with your real estate agent, so you should make every effort to find someone you trust—and like! With all this in mind, here are the top five reasons we’re the best team to help you buy and sell your home.
1. Helping clients is our passion.
For our team, real estate isn’t a part-time job, it’s our livelihood. Our dedication to our clients and our work is unmatched, and we’re proud to earn countless referrals from our satisfied clients. We feel privileged to be able to give back to the community by helping people manage their important real estate transactions.
2. Our days on market and sale-to-list price ratios meet or exceed market expectations.
We consistently meet or even exceed market averages as measured through our sale-to-list price ratio and the days on market. The sales-to-list ratio is the difference between the original list price of the home and the final sale price. A ratio of 100% means that the home sold at the same price for which it was listed. If the average in your area is 104% (selling for 4% more than the list price) and an agent has a ratio of 96% (4% less than the list price), you’re losing value. Similarly, if the days on market in your area averages 21 days and your agent has an average of 36 days, you’ll be spending significantly more to market your property. We’re able to meet these market benchmarks thanks to our top-notch negotiating skills and data-driven home pricing expertise.
3. We believe in open, honest communication.
We earn our clients’ respect by working tirelessly on their behalf and by always offering candid advice. We’re also honest about the value of a seller’s home and what the price should be to sell. By being straightforward about this number at the outset, we avoid overpricing—a far-too-common mistake that ultimately costs sellers significantly in both time and money. If you’re looking for a new property, we’ll set appropriate expectations on finding a home that meets your “must-have” list and fits your budget. We also know the importance of identifying your home’s best features and highlighting them in our marketing to maximize buyer interest.
4. Our huge network helps both our buyers and sellers.
Working full-time in real estate means we’ve built an extensive network of buyers and sellers. This means we learn about potential listings and interested buyers before the information is public on the MLS. We also have an expansive network of professionals who handle the critical services (such as home repairs, inspections, and financing) that clients need throughout the buying and selling process.
5. We know San Francisco inside and out.
We work in San Francisco, and we also live here. Our extensive local knowledge, combined with our use of tools such as the Comparative Market Analysis (CMA) reports, keep us current with key metrics that help our clients get the most value out of their real property transaction. That means we know how to price homes, and we know how to drive a good bargain. Bottom line? Whether you’re buying or selling, we’ll make sure you get the best possible results.
As the year draws to a close, we remain committed to helping our clients achieve their real estate goals for today or in the future. Our team of experienced professionals will be delighted to talk in more detail about the information we’ve shared here. We welcome you to contact us with any questions about the current market or to request an evaluation of your home or condo.