Although recent stock market volatility driven by the European debt crisis continues to rattle investors and potential home buyers, the Market Focus report observes that the crisis effectively pushed mortgage rates back to historically-low levels.
In May 2010, the median single-family home price in San Francisco improved to $752,500, a slight increase from May 2009. But Rosen Consulting Group states, “While the rate of growth in the median sales price flattened, the market is still in much better shape than it was one year ago when home prices were in free fall. Rising housing affordability, driven by attractive pricing and low mortgage rates combined with a more optimistic view of the economy assisted by government incentives have brought buyers back to the market. Recognizing the shifting market conditions, sellers who have been waiting for more favorable market conditions to place their homes on the market should begin to do so in coming months.
Although the Rosen Consulting Group expects to see some effects of expiring tax credits on future home sales in San Francisco, Lee believes that the pent-up demand in the market matched with a rise in hiring activity into the second half of the year, should counterbalance the anticipated fallout from expiring government programs, sustaining the market’s recovery.
(Editor’s Note: Appearing above is the press release accompanying the Association’s Market Focus report for May. The report can be viewed by clicking on the link above the press release. A report is issued each month jointly by Rosen Consulting Group and the Association. The reports are intended to provide the media and REALTOR® members of the Association with monthly analyses of the state of the local economy and the housing and mortgage markets.
The reports are issued ahead of reports from CAR and NAR and, hopefully, will go a long way to dispelling the notion that the San Francisco residential real estate market is little different than other markets in the country experiencing stagnation and significant price declines.
Rosen Consulting Group is an economic and real estate consulting firm providing clients with high-level strategic consulting services. Founded in 1990 by Dr. Kenneth T. Rosen, he and Arthur Margon are currently the firm’s partners and active managers. Rosen Consulting Group consists of 20 research professionals based in Berkeley, CA and New York.)Growing confidence in the San Francisco economy and its housing market has revived home sales activity in the City by the Bay. Home sales activity continues to accelerate, while inventory levels recede from recent highs, according to the latest Market Focus report issued jointly by the Rosen Consulting Group of Berkeley and the San Francisco Association of REALTORS®.
“As closed sales activity has rebounded, sellers have regained some leverage in negotiations,” says John Lee, president of the San Francisco Association of REALTORS®. “Prices at the low-end of the market are stable while pricing volatility in higher-priced segments remains,” according to Lee.
The Rosen Consulting Group believes that despite the pause in median price appreciation and anticipated slowdown during the summer months, the underlying housing market trend remains positive and will continue to improve through the remainder of the year.