Posts Tagged ‘Mission’

Where Renting is Most Expensive in San Francisco

For those of us living in San Francisco, it’s no surprise the price of housing is a big concern both locally and nationwide. San Francisco in fact has been the country’s most expensive rental market (for one bedroom units) since August 2014 when our City by the Bay claimed the top spot over New York City.

Thanks to our friends at Trulia, here’s a breakdown of the San Francisco’s neighborhoods where rents are highest:

San Francisco Neighborhoods with the Most Expensive 1-Bedroom Rentals

#

Neighborhood

 % of 1-Bedrooms Renting for $3,000+

Median Rent

1

Fisherman’s Wharf

82.80%

$3,500

2

Mission

78.8%

$3,500

3

Pacific Heights

73.8 %

$3,600

4

Castro

71.9%

$3,500

5

Potrero Hill

71.7%

$3,600

6

Telegraph Hill

70.0%

$3,325

7

Mission Dolores

69.0%

$3,500

8

Cow Hollow

68.8%

$3,350

9

Hayes Valley

68.7%

$3,500

10 

Marina

68.3%

$3,348

 

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You may recall the story we published in September where we analyzed the financial question of Buying vs Renting and revealed this gem: Buying… is a better financial decision even if you could rent for free! Despite early indicators showing our local market could be leveling off, don’t expect prices to decrease unless we see an actual decrease in demand. 

 

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Meredith Martin is a Broker Associate at Paragon Real Estate Group and can be reached at Meredith@OpeningDoors.me

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Updated: New Condo Developments in San Francisco

 

 

 

 

For more information on any of the new condominium developments now selling or under construction, please contact me.

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Meredith Martin is a Broker Associate at Paragon Real Estate Group and can be reached at Meredith@OpeningDoors.me

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San Francisco Market Overview: August 2015

 

It’s been an uncommonly busy summer for real estate in the Bay Area. In fact, more single-family homes sold in the region last month than in any July since the housing bust! Even with median prices for homes and condos alike in San Francisco exceeding $1,000,000 for the 6th consecutive month and inventory at its lowest since January, the number of property sales recently has kept on pace with the spring months.

Even with prices in the area at record highs, there’s opportunity to buy within the six-figure range. Almost 100 sub-million dollar condos have traded hands this year in the Noe Valley / Cole Valley / Corona Heights area alone. This past week, two properties have come on the market with list prices under $500,000: a Victorian TIC in the heart of the Mission, and a Downtown studio condo. Not only may properties like these be great investment opportunities, but shelter from the city’s rent explosion as well.

Right around the corner, Labor Day Weekend marks the beginning of the last big market push before the end of the year. Historically, we see inventory spike in September, and I’m seeing many properties getting prepped right now for the open market. Employment in San Francisco is at a record high, and an interest rate hike is looming on the horizon — all things considered, it could be the perfect storm for a frenzied Q4.

In every market there are always ‘deals’. You just have to know where to look, how to win them and be prepared to act.

 

PS: Here’s a first look at the 67 new condos at the corner of Franklin and Bush, expected to begin selling this winter. Additional information: 1450FranklinSF.com

 

 

Meredith Martin is a Broker Associate at Paragon Real Estate Group and can be reached at Meredith@OpeningDoors.me

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Just Passed: Build Rent-Controlled In-Law Units

 

The San Francisco Board of Supervisors just unanimously passed legislation allowing for the addition of new in-law units throughout Districts 3 & 8. This affects the following neighborhoods: Chinatown, Nob Hill, Russian Hill, North Beach, Fisherman’s Wharf, Polk Street, the Financial District, Union Square, Castro, Eureka Valley, Upper Market, Noe Valley, Duboce Triangle, Diamond Heights, Glen Park, College Hill, Corona Heights, Buena Vista, Twin Peaks, Mission-Dolores, and parts of the Inner Mission.

This comes in the wake of city-wide legislation passed earlier this year allowing unlimited density to be added to residential structures within a building’s existing footprint when ‘structural upgrades’ (such as seismic retrofitting) are also made. While the legislation passed today does not stipulate structural upgrades, new in-law units must be added within the existing envelope of the building.

“It’s great to know we can add housing without changing the exterior configuration of buildings, and of course the possibility to add rent-controlled housing in 2015 is exciting.” – Julie Christensen, Supervisor, District 3

 

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Meredith Martin is a Broker Associate at Paragon Real Estate Group and can be reached at Meredith@OpeningDoors.me

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Million Dollar Affordable Housing. Only in San Francisco.

 

No San Francisco neighborhood has so squarely positioned itself at the epicenter of opposition to rising housing costs than the Mission District. Of course, housing un-affordability is but one of many rapid changes in the neighborhood, and seeking legislative action is but one response (sidebar: remember when protestors were blocking tech shuttles?) — and median home prices have soared 76% citywide since 2011! For now, let’s take a focused look at some of the real estate sales dynamics in the Mission.

August 2007, at the peak pre-recession height of local real estate, a TIC at 901 Guerrero Street (below) sold for $955,000. The 3-bed and 1.5-bath Edwardian was purchased for 12.5% more that its list price and in 26 days on the market.

 

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Earlier this year, in February 2015, I represented the buyer of 901 Guerrero Street sold for $1,650,000. This time, the property returned favorable to the market with a fresh coat of paint, a successful condo-conversion on the record, and convenient proximity to “every tech bus.” The winning bid (of course there were competing offers!) after only eight days on the market came in at 18% over asking. The San Francisco Chronicle even wrote about it.

 

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Given that 901 Guerrero did have a significant value-adding improvement between 2007 and 2015, consider still that its 2015 price is nearly 75% higher than at the previous peak. It’s not uncommon for properties to be improved from one sale to the next, and it makes sense that those properties will sell for higher prices, all else equal. Couple that with record-low inventory and cash investors, and now not even techies (let alone teachers) can compete as homebuyers. Since 901 Guerrero Street sold, I’ve seen comparable properties in the neighborhood sell for even higher. What’s a city like San Francisco with its economy supercharged by the high-tech boom to do?

There appears to be a “try everything” approach in the works for the Mission.

First, a ballot initiative calling for an 18-month moratorium on new market-rate residential developments in the Mission has been approved for the November 2015 ballot. If passed, the effect of the moratorium on neighborhood home prices can be debated. Because the overwhelming majority of housing in the Mission is market-rate which is favored by homebuyers, constraining supply could drive prices of existing homes higher. Alternately, negative attitudes toward an influx of affordable housing could lead residents to leave for other neighborhoods and influence homebuyers to buy elsewhere, ultimately hurting market-rate resale values.

Second, the city is feeling pressure to build more affordable housing units right now. Such developments, like 490 South Van Ness at 16th Street, are permanently reserved for low-income, median-income and moderate-income residents. Below Market Rate housing is purchased for a fraction of market value– not a single unit has sold in the Mission since March 2014 (and a 2-bedroom BMR condo in the Inner Mission is listed right now for just under $450,000). Plus, projects like these can take a year or more to construct once ground is broken, meanwhile the price of affordable housing continues to rise with $15 minimum wage.

Lastly, flood the market with new housing units of all kinds to help meet demand and stabilize prices as quickly as possible. There are 26 residential developments planned for the Mission and a few have begun construction (see the entire pipeline of residential projects in San Francisco here). Still, the pace of new units coming to the market pales in comparison to the city’s growth of employed residents (yes, people can afford to relocate to San Francisco even with housing costs as they are). Some sites available in the Mission could be bought by the city for affordable housing, and the proposed moratorium would give it enough time to organize and fund the investment.

 

A 2015 Yale School of Management survey of recent home buyers found that a quarter of San Francisco respondents has the extravagant expectation for annual home price increases of 10% or more annually for the next 10 years. Although more likely be closer to 5%, it could happen. In 20+ years working locally in real estate, I’ve learned to never underestimate the voracity of the San Francisco market. I’m of the opinion San Francisco median price trends are headed the direction of Tokyo, Sydney and London toward $3,000 per square foot. Before we get there, though, we may find ourselves asking sooner rather than later: When does an affordable housing unit cost a million dollars?

 

Meredith Martin is a Broker Associate at Paragon Real Estate Group and can be reached at Meredith@OpeningDoors.me

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