The NBA finals between our Golden State Warriors and the Cleveland Cavaliers is a showcase for starkly different basketball styles – the run and gun, three-point-happy Warriors and the bigger, slower-paced Cavs who like to play under the hoop. But as dissimilar as the two basketball teams are, that’s nothing compared to their respective housing markets, which are worlds apart.
Let’s start with the median sale price. In San Francisco, according to Zillow, the median sale price now sits at $1,136,000. In Cleveland: $49,400. Honest. Put another way, you could get nearly 23 “typical” homes in Cleveland for one in San Francisco!
While Oakland itself may be more affordable than SF, that market’s median sale price is still 12-15 times Cleveland’s, depending on which area of the city you’re looking at.
SFGate, the Chronicle’s online publication, even found a five-bedroom fixer-upper in Cleveland that was actually listed for $8,000 (about the price of renting a studio in San Francisco for three or four months). The paper conceded that the Cleveland home was in a neighborhood that has had a history of foreclosures and crime, but said the area is “starting to turn.”
According to the most recent Case-Shiller report, house prices in Cleveland are still down 12.5 percent from their pre-recession peak. That compares to the Bay Area, where most communities have since hit new record highs.
So suffice it to say, you can get a whole lot more home for your money in Cleveland than you can in the Bay Area. But of course, you wouldn’t be able to enjoy all the things this beautiful region has to offer. AND…you wouldn’t have the Splash Brothers and the Warriors to cheer on to another NBA title! Go Dubs!!
Below is a market-by-market report from our local San Francisco Bay Area offices:
North Bay – It appears the San Rafael real estate market is starting the summer slowdown, our local manager reports. It may be seasonal or a shift/drop in the market. The buyer activity appears to be slowing down. This is great time for buyers to negotiate on homes as there is less competition from other buyers. However, the sellers are still pricing their properties at the peak of the market. Sellers should be looking at what price homes are on the market now and price their home lower that the competition. Now is the time to adjust to the changing market, he says. It appears the under $1,000,000 is still very active as that is the price a lot of the buyers can afford. Our Southern Marin manager reports reductions on most (75%) properties listed over $3 million during the last two weeks. And more luxury listings are coming on the market every day. Luxury buyers have more inventory available than we have seen in the last two and a half years. The general market remains in strong demand with 75% of properties listed under $1,000,000 receiving multiple offers, 40% of homes listed between $1 and $2 million receive multiple and only 5-10% of properties listed over $2 million receive multiple offers.
San Francisco – Graduations and impending vacations are beginning to distract buyers, who say they are already feeling a little nervous due to reports of economic uncertainty, according to our Lakeside office manager. About half of the sales are still multiple offer situations.
SF Peninsula – Listing inventory is steadily increasing in the Burlingame area, and so are sales, according to our local manager. Across the hill in Half Moon Bay, there has been a continuous increase in inventory. Our local manager provided this update for the area of Half Moon Bay, El Granada, Montara, Moss Beach, and Pescadero market update: The average listing price is $1,428,716, highest listing price is $3,388,888, and the lowest listing price is $699,000. Pending Average listing price is $1,372,445, highest listing price is $1,988,000, and the lowest listing price is $785,000. Sold average listing price is $1,062,552, the sold price is $1,071,980, days on the market is 14 days. Low listing price $598,000, the sold price is $665,000, days on the market is 1 day. Our Menlo Park manager said the local market is steady but cautious. No throwing money at houses now like caution to the wind. She adds that sellers are more likely to look at a pre-emptive offer now realizing that we could be close to the ‘top of the market’ if anyone can really see that without it being behind them. Our Redwood City-San Carlos manager reports lots and lots of frustration out there for everyone (sellers, buyers, agents). It’s a definite alteration in the market (which was needed). Only the ideal homes with the ideal location and the ideal price are selling quickly. All the rest are remaining on the market with very little, if any, showings. The San Mateo market has slowed down, our local manager says. Our Woodside-Portola Valley manager says that Woodside continues to be a good/bad market. It is a month to month thing. Big buyers are out there but always waiting for the RIGHT house. The market is feeling cautious, she notes.
Silicon Valley – Our Cupertino manager says homes are staying on the market longer and need to be priced right. Open houses are spotty. That can be a good thing because agents have more chances to engage visitors in conversation, and perhaps get new clients. She adds that the luxury segment has been slowing. In the Los Gatos area, competition remains heavy for entry-level homes listed under $2,000,000. More inventory is hitting the market in the $2,000,000 plus range. Our San Jose-Almaden manager says we’re starting to see an increase number of active listings as well as a lower number of homes pending in Santa Clara County. The available inventory is actually higher than the number of available in 2014. Not surprising were the lower number of units sold for May. There were 35 properties sold in Almaden for the month which is down 25% from last month and 18% from the previous year. Blossom Valley was slightly better with a total of 101 homes sold for the month which is down 8% from the previous month and down 8.5% from the previous year. Cambrian was almost flat, with 78 properties selling for the month which is just down 2.5% for the previous month and year. Santa Teresa had 27 homes sold which is down 23% for the previous month and down 16% from the same time last year. Willow Glen had a sleepy Memorial Day week. Sales were slow and not many new listings came to the market. The following week things started moving again we had one of our better sales weeks and listing inventory is back up to 92 units. We are still hovering at 3 & 4 year highs for active listing inventory. The local market seems to be driven mainly by price point. Anything under or around the $850,000 price point is drawing lots of attention and still attracting multiple offers well over list price.
South County – There is definitely an upswing in market activity in South County. Listings are more plentiful and there has been a marked increase in the number of sales both in Gilroy and Morgan Hill. Agents are reporting that their open houses are very well attended and that there is a general sense on the part of buyers that real estate continues to be a good long term investment. The South County continues to be a viable alternative for buyers who are priced out of the market in Silicon Valley (San Jose, Santa Clara, Sunnyvale). Buyers’ purchasing dollars go further in South County where they are able to buy bigger homes on larger lots for substantially less than they would spend in northern communities.
Santa Cruz County – The currently number of active single family residences on the market in Santa Cruz County is 369, compared to 519 as of this time in 2015. Year to date there have been 77 fewer sales than 2015, with 648 total as of June 1st. There are an increased number of transactions that have been canceled in the recent weeks, according to our local manager. Homes that are priced and presented well are still receiving multiple offers if they are located in a desirable area. It’s a great time to be a seller as the average sales price is higher than it has ever been. Our manager says there has been a bit of pessimism in recent economic forecasts pertaining to HELOC delinquency rates, projected stock market performance and the tech industry layoffs planned to occur in the near future. The number of Previews Properties active on the market is currently 186, which represents approximately half of the total inventory of single family homes on the market. The average sales price of homes is currently approximately $890,000 which is the highest ever. The number of sales is up to 44 which exceeds this time in 2015 by 6 sales. The average days on market for Previews listings is currently 65 which is shorter by about two weeks compared to this time in 2015.
Monterey Peninsula – Agents have noticed a slowdown in activity from the pace of Q1 2016, with a slight decrease in inventory and days on market to sold. The general climate reflects a slow-down in showings and activity on the Monterey Peninsula. This is the time of year that the out of area visitors start to arrive and enjoy their vacation home or summer rentals. They are always interested in getting the pulse of the market, and will stop into our open houses and offices. Values on the Monterey Peninsula have reached pre-recession prices, he said, so now is a great time to list and sell your property.
Market Watch is a bi-weekly column by Coldwell Banker San Francisco Bay Area president Mike James. Click here to view past issues.