Condominium owners looking to sell in Downtown San Francisco face a collapse in prices.
The median condo sales price in the greater Downtown and South of Market are down 16.5 percent from a year ago, the San Francisco Chronicle reported, citing a Compass study.
Since December of last year, the condo median sales price fell from $1.475 million to $1.23 million in the area that includes Civic Center, SoMa, Mission Bay, Yerba Buena and South Beach.
The Downtown condo market has borne the brunt of San Francisco’s tepid post-COVID recovery, with many owners willing to sell at a discount amid tech layoffs and office closures. The drop in median prices in Downtown neighborhoods was double that of other parts of the city, according to the newspaper. Outside of downtown, the median price of condos dropped 7 percent in the last year, while single-family homes fell 7.5 percent.
Compass’ Patrick Carlisle (LinkedIn)
The Compass study concludes the tumbling demand is driven by “a triple whammy of economic, demographic and quality-of-life issues.”
“I knew that market segment had weakened, but I didn’t realize the degree to which things had changed,” Patrick Carlisle, chief market analyst for Compass, told the Chronicle. “It was a bit shocking.
“San Francisco went from being the hottest office market in the world to just about the weakest.”
The city’s condo market has hit headwinds both local and national. A declining stock market, rising interest rates and inflation have affected real estate markets from coast to coast.
At the same time, office occupancy in Downtown San Francisco has plummeted further than other cities, with declining foot traffic crippling small business and making streets less safe.
The high-rise housing that popped up in South of Market over the past two decades was built to serve hundreds of thousands of workers flooding into the city. But with many jobs gone remote, demand for local housing has waned.
Prices at Lumina, a two-tower luxury complex in SoMa, have plummeted, according to an analysis by Socketsite.
An 1,800-square-foot, three-bedroom, three-bathroom unit on the 32nd floor at 338 Main Street sold for $3.25 million in May 2016, then traded again in August 2019 for $3.5 million. In September, it listed for $3.15 million and sold last month for $2.68 million, a drop of 23.4 percent since 2019.
A two-bedroom unit there listed at $2.6 million, 21 percent less than its 2016 price of $3.33 million.
Demand for new luxury condos has slowed since the pandemic. In October, only 13 of the 146 condominiums at the Four Seasons Private Residences at 706 Mission Street had sold.
Park North Real Estate’s Kevin Birmingham (LinkedIn)
There’s also lower demand when condos hit the market.
Realtor Kevin Birmingham of Park North Real Estate said the Compass study mirrors what he is seeing across the city. He just sold a condo in Twin Peaks that listed for $695,000. It closed at $680,000. The seller expected to get $800,000.
With falling prices, many would-be sellers now look to rent their units. “Listings are getting withdrawn and going straight onto the rental market,” Birmingham said.
— Dana Bartholomew
Read more
Residential
San Francisco
Market lags for condos in Downtown San Francisco
Commercial
San Francisco
San Francisco office vacancies up across board