According to Compass market analysis, for the first time in a decade, median home prices in San Francisco fell by 1% from a booming 2021 to a cooling 2022 and came to rest at $1.78 million. Oddly enough, single-family homes are doing twice as well as condos, with more than 60% of sales closing over asking price. Recent tech layoffs certainly won’t help the condo market in months ahead. But it’s yet to be seen how big of an impact the “Tech-xit” will have.
The market continues to wake up on the cool side of the pillow, with inventory and median sales prices down year over year. Of course, the holidays are typically a slow period, and with the global economy still in recovery mode, we’ll see what the new year has in store.
According to data from the California Association of Realtors, the housing market is weathering the economic downturn better than it did during the Great Recession, as buyers have more skin in the game.
Compared to those who bought their homes before the recession, buyers in recent years have made higher down payments, taken on fewer risky loans and second mortgages, and have higher household incomes. That means we can expect fewer defaults and foreclosures as the market continues to shift.
As COVID eviction moratoriums expire up and down the state, investment in rental properties is on the rise and back to pre-pandemic levels. Meanwhile, the wages and wealth of renters have remained pretty much stagnant for the better part of this century, while homeowners have seen a surge in their net worth since the early 90s, despite the housing bubble bursting in 2007-08.
Our housing market — and the greater economy — remain in a period of adjustment, making buyers and sellers more cautious as they wait to see how the dust will settle. One key indicator of this adjustment is the percentage of homes selling below their list price, which you can track in the chart below.
