Time To Watch The Sunset…
June 5, 2009Wish we were referring to a magical moment as the sun dips below the Pacific horizon on a gorgeous evening… but we’re referring to “The Sunset”. Sales price trends in the neighborhood have long been thought to be a decent barometer of the overall San Francisco housing market. Why? The Sunset is a large, fairly stable neighborhood with many similar homes selling around San Francisco’s median.
So let’s take a look at the median sales price from January 1, 2009 through June 1, 2009. And better yet, lets compare this year’s median to that of years past, over the same time period. This should give us a glimpse into present day conditions, not just in the Sunset, but into the San Francisco market as a whole (if the aforementioned theory holds any weight). And as our readers know, we’d love to go back further than 1995 but MLS does not support that. Here is the trend:
Sunset SFH Medians from 1/1 thru 6/1 Over Time (click to enlarge)
- In order to control for the changing value of the dollar, numbers were inflation adjusted. This gives us a more accurate view of market movement.
- As you can see, the median is down substantially this year from last… 14.48% to be exact.
- From the peak in 2005, home prices are down 24.97%.
- Home prices today are just a smidge higher than they were in 2003.
Here are the numbers of sales that have taken place from January 1, 2009 through June 1, 2009 of each year:
Number of SFH Sales Each Year - 1/1 thru 6/1 (click to enlarge)
- Wow, check that out. A 48% decline year over year for single family home sales in the Sunset.
- From the peak in activity in 2003, the Sunset has realized a 61% decrease in sales volume.
Final Thoughts:
The Sunset is a neighborhood we keep a close eye on, whether the theory that it is a good SF barometer is true or not. The neighborhood has experienced a big hit here in the first part of ’09, with respect to sales prices and volume. The two usually go hand in hand… if sales volume is low, sales prices come down (the reverse is also true). The 25% correction from peak is pretty much in line with the overall San Francisco market. Of course, as we’ve written about many times before, different market segments react at different times. The low end first, followed by the middle, then the high end. We feel that declines here in the middle market have slowed but will take a while to stabilize.
For more neighborhood analysis, click HERE.
