Real Estate Column: How to Buy and Sell in San Francisco Today

by Jennifer Rosdail

We live in a city a mere seven-by-seven miles large surrounded by water, and due to price, weather, commute and other factors, most buyers concentrate on an area more like two-by-two miles. And while there may be a glut of SoMa lofts, there is still a shortage of three-bedroom/two-bath condos in traditional neighborhoods. Is it possible there will ever be enough inventory for buyers to really be in the driver’s seat?

With San Francisco’s population at an all time high (824,000 according to the California Department of Finance), I would submit that this is not that time. While home prices in some communities in the Bay Area have dropped up to 40 percent since 2005, prices in San Francisco have continued to modestly climb. The same is true for Marin, and parts of the East Bay and the Peninsula.

That is not to say that this is the “go go” market of a few years ago. Whether a property is going to sell quickly with competitive bids or languish and eventually sell under asking price varies property by property.

Why does the dichotomy between the “hot” property and the floundering property persist? Well, it comes down to the individual decisions sellers make when preparing and pricing their homes. For example, a developer will prepare and price a property very differently from an out-of-town heir. A seller may choose a listing price because it worked for a neighbor or it is just what they want.

What’s the best way to react? How do you know what to do if you are buying or selling?

If you are a buyer who is looking for a bargain, have flexible requirements and watch older inventory. If it’s been on the market more than three weeks, chances are it is comparatively over priced. Go ahead and make an offer for what you think it is worth! San Francisco buyers don’t often enough make offers under ask – they wait for the price to drop and then end up in competition. Don’t wait! If yours is the only offer you are more likely to pay a “below market” price.

If you are a buyer who has lots of “must haves” on your list, I would advise you to carefully watch the newest inventory. If you have an immediate, positive reaction to a home, then it is likely others are having the same feeling. Ignore the national news and understand that this is a property that will not sit around. In this case, you need to carefully analyze the sale prices of other places you have liked and make a realistic offer. If there is no offer date set, act decisively. The same as with sitting inventory, if yours is the only offer, you are more likely to pay a lower price.

As a seller, maximizing value involves three things: property preparation, marketing and pricing. Prepare the home so it shows well – small repairs and staging can make a big difference. Hire a Realtor who will market it aggressively. Finally, price the home so that buyers immediately see its value.

In order to do this, you must honestly compare your home’s assets to those of other recent sales. Ultimately the market will determine your sale price. However, the number of people who see your home and their expectation as they walk through the front door will be greatly impacted by the relationship of the value of the home to its pricing.

Jennifer Rosdail is a realtor is Paragon Real Estate Group She can be reached at 415-269-4663 or Jennifer@rosdail.com. To hear more from Jennifer, read ClientsInTheKnow.com.

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