Happy October! This has got to be one of the best months in San Francisco. We’ve got our true summer, and then there’s Halloween, and everything fall related. Taking my son trick-or-treating on Chenery St. has always been so much fun. I love the energy and spirit in the neighborhood on Halloween, and how everyone comes together to make it safe and fun. My lovely clients on Mizpah (now moved away) had the most amazing setup.
Here’s a picture of their place in 2018:
This year is somewhat bittersweet for me as my son is now 13, and he’s on to preferring his friends for Halloween company, but it’s also fun to see him finding his independence!
So, how about the real estate market? As we sit around waiting for the mortgage rates to go down, they continue to go up. Right now the rate is hovering around 7.4% for a 30 year fixed. Not appealing to a lot of buyers. We are seeing many more sellers who want to get into contract faster, or for a higher sales price, offering 2-1 buydowns. This is a program with lenders where a fee is paid and then the loan will have a rate 2% points below the market rate for the first year and 1% on the second year. The thinking here is that sometime within the next 2 years that buyer can refinance into a lower rate long-term loan.
To put this into practical terms for perspective – if a seller is willing to give a buyer a $30k credit on the sale, if that just comes off the sale price for the loan with no buydown, the buyer will save about $200/mo on their mortgage. If that goes to a 2-1 buydown, that will save the same buyer about $1700/mo for the first year, and about $850/mo for the second year. Most lenders are also offering no fee refinances within a number of years. Good question to ask your lender if you’re thinking about buying!
The inventory has definitely risen as expected after Labor Day, but the absorption rate (rate of properties going into contract in relation to listings available) is still down. If you’re buying or selling in this very interesting market that we find ourselves in, definitely talk through what creative options you have available to you. There are options!
I’m still anticipating that we’ll see rates go down some by the mid-to-end of next year, but no one has that crystal ball. It’s an uncertain time for many reasons – but yet, life still goes on! People get jobs in different locales, people need to downsize, people have children and need to upsize, or someone adopted 5 rescue dogs because there are so many needing homes after the pandemic rush on dogs and now they need a much bigger yard. I’m seeing a lot of buyers entering the market and just waiting for that “perfect” place. This is why presentation is so important right now – if you’re looking to sell, know what the biggest “bang for your buck” improvements are and do them. Don’t miss out small changes that can make a big difference. A good real estate agent can give you a valuable assessment and recommendations regarding what really moves the needle.
Here’s a look at what sold in the month of September:
Here’s a look at what’s currently in contract:
And lastly, the inventory that is currently available in Glen Park:
Until November…
For more San Francisco sales data, visit: thegoods-sf.com/AmandaMartin/
Amanda Martin