San Francisco Real Estate - Residential

San Francisco Real Estate Market Update for the week ending May 10, 2009

Recent Housing Stats Are Showing Encouraging Signs for Market

This week I thought I’d share some positive stories that continue to permeate not only our local news but on a national level as well.

The National Association of Realtors® said its Pending Home Sales Index, based on contracts signed in March, rose 3.2% as first-time buyers waded into the market to take advantage of favorable prices and mortgage rates.

A report from the U.S. Commerce Department showed construction spending rose 0.3% in March, the first increase in six months.

The pending home sales report added evidence that sales have reached a bottom. “That’s critical because once sales bottom, it’s only a matter of time before you work off excess inventories. That’s the key to stabilization in the financial system and the economy at large. We’re closer to that than people thought just a few months ago.”

– Michael Darda, chief economist at MKM Partners in Greenwich, Conn., “Sales and Construction Data Lift Hopes for Housing,” by Lucia Mutikani, Reuters, May 4, 2009.

On a national basis, the forces driving real estate right now are increasingly turning positive and encouraging.

• Home sales in major markets around the country have shown dramatic gains in the past month.
• In Florida, statewide sales jumped by 30% in March over year-earlier levels, and were up 33% over the previous month. Even condo sales were up by 25%.
• In California, statewide sales rose 64% in March compared with March 2008. Unsold inventory is now just five months — that’s down from 12 months the previous March.
• Median house prices may be bottoming out. The California Association of Realtors® reports the median price of homes sold was up by 2.2% for the past month.”

– “Real Estate Outlook: Sales Rising in Some Areas,” by Kenneth R. Harney, Realty Times, May 5, 2009.

Also interesting to note:

• The current price level of homes seems to be drawing more buyers into the market, according to Jim Gillespie, president and CEO of Coldwell Banker Real Estate. “We are seeing a lot of activity across the nation. Of course we’re in the spring market, but we’ve seen more buyers in the market now than at this same time last year.”
• “Home prices are where they should be. Sellers are accepting the current reality and are pricing more realistically,” said Robert Abbott, co-owner and VP of a northern New Jersey brokerage. “More people are not only ‘kicking the tires’ but actually buying right now. We are showing significant activity when it comes to sales. The number of days for a house on the market is going down.”

– “More Homes Get Multiple Offers; Downturn May be Nearing End,” by Julie Schmit, USA Today, May 6, 2009.

• Multiple bids have picked up in recent months in California and other states hit hard by foreclosures and steep price drops, real estate executives say. “If a house is in a good neighborhood, is maintained and is a good value, it’ll get multiple offers. One in 10 homes now draw multiple offers, up from one in 30 last fall.”

– Julie Holt, owner of a title services company in Florida, “Is Now the Time for Some Home Buyers to Make a Deal?,” by Mark Koba, CNBC, April 28, 2009.

And with that news in tow, let’s take a look at this week in real estate:

Go to our website for the local market reports.

- Rick Turley

posted by SFResidence.com @ 5:49 PM