Cash is everywhere in San Francisco these days, and it changes the market for all buyers, even those that are getting financing. I’ve written elsewhere about how cash changes everything for everyone. While I’ve heard (and seen) plenty of anecdotal evidence that cash is indeed everywhere, I wanted to see if I could somehow quantify exactly how much cash is currently in the San Francisco real estate market.

How did San Francisco Buyers pay for their condo?

The above pie-chart is based on data from the San Francisco Multiple Listing Service. I exported all of the sales since January 1, 2013 (which means the house may have been listed prior to 2013, but it closed in the 2013 calendar year) by property type, and then sorted them by the financing that was reported by the listing agent at the time the sale closed.

This method isn’t foolproof – plenty of agents don’t enter any information about financing when the sale closes, but while the data isn’t foolproof, I would say it is pretty solid data and a good starting point for discussing all cash condo sales in the San Francisco real estate market.

As you can see from the chart, conventional financing was the most common way to pay for a condo. Slightly more than half of the sales that reported financing information indicated that the buyer purchased the condo with conventional financing.

In second place are all cash sales – and all cash condo sales are currently making up more than 1/3 of condo sales in San Francisco!

“Other” financing comes in a very, very distant 3rd place, followed by adjustable financing (the interest rate is not fixed for the full loan term), FHA (two sales), seller financing (two sales), and VA (veterans affairs, 1 sale).

So if you’ve been hearing that there is a lot of cash in the San Francisco market, you’ve been hearing absolutely correctly. What are your thoughts about the current market?

I have to admit, I’m fascinated by Tower 2 at One Rincon Hill. So much about Tower 2 construction at One Rincon Hill fascinates me. For example:

• The fact that such a large building that will be home to so many people can rise from such a small sliver of land.
• The legal process behind combining the new building into the HOA of the existing building.
• The ramifications of the developer leasing the new homes instead of selling them – how will this affect the ability to get financing in the existing tower?
• What will the existing tower be called? Tower One? Tower Classic? Classic Tower? The old Building?

Tower 2 Rises at One Rincon Hill

While I was out in South Beach this afternoon for Tuesday Broker’s Tour when I chanced upon a great view of the Tower 2 construction at One Rincon Hill.

As you can see from the picture above, they are making great progress on erecting Tower 2. It looks like the central core construction of Tower 2 has reached as high as about the 24th floor in Tower 1. The buildout of the floors from the central core seems about 8 stories behind the central core, which would put them at about the 16th floor of Tower 1. Considering that just a few months ago the tower wasn’t even visible, it really is incredible the progress that has been made recently.

We just sold a home at One Rincon Hill, and are incredibly familiar with the neighborhood and building. If you are interested in living in this destination South Beach condo building, don’t hesitate to give us a call or email at your convenience. And if you want to see what is currently for sale at One Rincon Hill just click on the link to see the homes listed for sale through the San Francisco MLS.

John King has an article up that ponders the future of the SF waterfront (paywall). While he seems generally happy with the revised renderings of the proposed Golden State Warrior arena, he spends more of the article pondering if the planning process in SF is broken, regardless of the results.

Rendering of Proposed Golden State Warriors Arena. Source: Snøhetta & AECOM

Calling out the Golden State arena, Mission Rock development, and Pier 70 redevelopment, John King asks if SF planning should have been anticipating these projects and have pre-existing standards to judge them against, or if it is okay to let developer’s frame the conversation around a specific project or proposal.

In a nutshell, what we are talking about is anchoring. Wikipedia gives a pretty approachable definition of it:

Anchoring or focalism is a cognitive bias that describes the common human tendency to rely too heavily on the first piece of information offered (the “anchor”) when making decisions. During decision making, anchoring occurs when individuals use an initial piece of information to make subsequent judgments. Once an anchor is set, other judgments are made by adjusting away from that anchor, and there is a bias toward interpreting other information around the anchor. For example, the initial price offered for a used car sets the standard for the rest of the negotiations, so that prices lower than the initial price seem more reasonable even if they are still higher than what the car is really worth.

When SF planning doesn’t have a clear and detailed vision for the “highest and best” use of land in the city, responses become reactionary. Instead of judging a proposed project against it’s best land use, we judge it against the proposed use. Instead of asking, “Hey is this the right spot for an arena” we end up asking questions like, “can we get more air and light at this end of the arena?”

It’s subtle, but in the first example a vision from the city anchors the inquiry and investigation process, so that a hypothetical best use is the standard against which all projects are judged. In the second example, which is developer driven, the proposed development is assumed to be the best use of the land, and the conversation moves away from whether or not the project is located at the right place to details of the proposed development.

What are your thoughts about SF Planning?

How was the month of April for condo buyers and sellers in South Beach, South of Market, Dogpatch, Mission Bay, and Yerba Buena?

April was a great month to be a seller in San Francisco

Overall, there were 73 sales reported in the MLS during the month of April, which is up slightly from the 69 condo homes sold during the same month in 2012. One of the sales was for a parking spot, though, so let’s call it 72 sales!

The most expensive sale was for a residence in the Millennium Tower, a 2 bed, 2.5 bath home in the Grand Residences that sold for under the asking price of $4,250,000.

The least expensive sale was for a tenant occupied studio at 201 Harrison St., aka the Baycrest.  The studio sold at the asking prie of $319,000.

For the month of April, in the buildings and neighborhoods we cover at this site, the sales broke down as follows:

Studio Home Condo Sales:

• Sold: 2 (one sale was of a parking spot, for a total of 3. The parking spot is excluded from these calculations)
• Average List Price: 384,500
• Average Sales Price: 395,000

One Bedroom Home Condo Sales:

• Sold: 33
• Average List Price: $679,000
• Average Sales Price: $710,000

Two Bedroom Home Condo Sales:

• Sold: 35
• Median List Price: $1,207,000
• Median Sales Price: $1,214,000

Three Bedroom Home Condo Sales:

• Sold: 2
• Median List Price: $1,099,000
• Median Sales Price: $1,205,000

April was a fairly busy month for homes at The Beacon, with eight sales in the building. One Rincon was the second busiest building, reporting five sales during the month of April.

Because most of the original building sales in these neighborhoods were not reported in the San Francisco MLS, it is almost impossible to make definitive statements about how the market is doing using just MLS data. If you are interested in learning about sales at a particular building or in one of the particular neighborhoods we write about here, don’t hesitate to drop us an email or a comment.

MLS rules restrict what we can publicly write about and what data we can share publicly, but we hope you find this information useful.

The folks over at SFist ask Why is Mission Bay So Ugly? To which I ask you, dear readers, is Mission Bay ugly?

The Madrone in Mission Bay

I will certainly agree that the building styles in the neighborhood tend toward the bland stucco or fairly popular and non-controversial glass curtain-wall style buildings (although, I have no idea if they actually are glass curtain walls. Feel free to correct me in the comments).

My experience of San Francisco is that while we can be avant-garde in a lot of areas, when it comes to housing we are downright stodgy. Given the number of committees, hearings, neighborhood groups, and other hurdles that must be cleared for a project to go from an idea to a reality, it doesn’t surprise me that much of our recent architecture is lowest-common-denominator. It needs to be interesting enough that it doesn’t make the planning commission fall asleep, but not so interesting that it makes anyone on the planning commission offended.

That said, at least Mission Bay isn’t home to any Edwardian loft buildings. Because those, quite frankly, really are an unfortunate creation.

My experience of working with buyers and sellers in  the Mission Bay neighborhood is that the clean, modern interiors are of much more concern to them than the building exterior. No one gets particularly excited and does cartwheels when looking at the exterior of The Radiance or The Madrone, but buyers almost always like the clean lines and open spaces of the modern floor plans that the buildings offer.

As for the rest of Mission Bay, much of the UCSF buildings suffer from the same challenges – a relentless focus on the bottom line, and design by multiple numerous committees. So while none of the projects are jaw-droppingly stunning, they also aren’t particularly offensive, except in the “couldn’t we do better, this is San Francisco…” kind of way.

What are your thoughts about the neighborhood buildings?

According to the fine folks at Société Générale, the US housing market is on it’s way up, up, and up. Which is excellent news after several rather painful years (which I’m sure I don’t need to recount in excruciating detail for you) for condo owners and sellers. It is not secret that the San Francisco condo market has been on fire as of late, and I’m not surprised to hear that the national picture has finally shown strong and convincing evidence that it is on the rebound.

US Housing Prices, source: Quartz

You can click on the above image of US housing prices for a larger version, and here’s an excerpt from the report:

Rising home prices imply that the deflationary dynamic that has plagued the housing market and the broader economy is now over. Until now, the rebuilding of tangible wealth has been accomplished largely through the liability side of the household balance sheet, i.e. via defaults and debt repayments. Not only is this type of deleveraging painful; it also tends to reinforce the economic weakness. Going forward, we believe that balance sheet repair will become a lot easier as rising home prices lift asset values and wealth positions. This trend has already begun, but will continue for some time.

Finally, I’d really like to give a phenomenal tip of the hat and shout-out to Quartz, which is a new site started by the fine folks that publish The Atlantic. Not only is the website absolutely gorgeous, but the content is incredibly well written, succinct, and relevant to today’s world. If you haven’t stopped by and visit the site, I’d highly encourage you to do so!

Original article at Quartz

What are your thoughts about the current San Francisco condo market? I’ve been asked by several people if we are in another bubble, and I’ll save my answer for that question in a future post. But before I chime in with my observations, I’d love to hear your comments below

I worked with some phenomenal clients last year who were amongst the first to move to South Beach before it became a destination neighborhood. Last year, they sold that home and moved to the Dogpatch. Not only are they incredibly delightful people, they’ve got an amazing sense for what and where is the next best thing.

Opening Exhibitions

Given all the recent business openings, I think they were right again about the Dogpatch. I’ve written before about really cool and interesting new businesses in the neighborhood, like Dogpatch Boulders. The Museum of Craft and Design recently relocated to the Dogpatch neighborhood, and it looks to be an incredibly interesting new addition to the Dogpatch neighborhood.

The museum describes itself as:

The Museum of Craft and Design has delivered innovative exhibitions and programs to thousands of visitors from San Francisco, the Bay Area and beyond. Our mission is to be an environment for experiencing innovative contemporary work in craft and design that engages the community while stimulating the creative potential in peoples’ lives.

One of the opening exhibitions hosts Arline Fisch and her exhibit Creatures from the Deep. Arline Fisch has a well deserved reputation for intricate textile technique as well as sophisticated and elegant jewelry design. This particular installation is a display of larger-than-life jellyfish constructed from copper wire. And by constructed, I mean knitted. I tried to knit once with yarn and it was a spectacular disaster, so I can only marvel at the skill that must be required to knit copper wire, much less knit it into something beautiful.

The Museum of Craft and Design is located at 2569 Third Street (between 22nd and 23rd), in the American Industrial Center. Their current hours are:

The Mission Bay Children’s Playground is slowly moving towards reality. Yesterday the project was in front of the San Francisco Art’s Commission Civic Design Review Committee. While Mission Bay has an incredible amount of open space (see picture below), it has yet to have a playground designed for children. If all goes as planned, that will soon change.

The park is located on a triangular parcel of land that is bounded on the north by Long Bridge St. and to the south by China Basin Rd. You can see it called out in the drawing below, showing where the Mission Bay Children’s Playground is in relation to the other open spaces, parks, and playgrounds in the neighborhood.

Mission Bay Open Space Plan (click for larger image)

According to documents filed with the Arts Commission, the playground is estimated to cost about $2,400,000 dollars and will occupy just over an acre of land. The estimated start date for construction is in June of 2013, with a projected finish date in the fall of 2014 (October-ish).

As you can see in the rendering below, a lot of thought has gone into the design of the children’s playground, and there have been numerous community meetings and public outreach to help define a park that will meet the needs of Mission Bay residents. The Mission Bay playground will have several distinct areas, including one for school age children, one for toddlers, a “nature play” area, as well as “free play” areas for those that want to avoid helicopter parents.

Mission Bay Children’s Playground – Overhead View (click for larger image)

The picture below is a rending made from the south end, with Long Bridge Street defining the Mission Bay children’s playground on the left side of the rendering, while China Basin St. can be seen at the very far right of the image.

Mission Bay Children’s Playground Rendering (click for larger image)

Personally, I’m excited to see this park finally move from renderings to reality. What are your thoughts?

It’s tax day! Which means that in addition to filing my extension, I’m 15 days behind in telling you about the Q1 condo market report for San Francisco real estate.

If you’re looking for Q1 2013 statistics and market data for single family homes then follow the link to my site where I write about everything San Francisco real estate related. But if you are looking for information specific to the condo market, then you’ve come to the right place.

In specific, the below chart compares Q1 2012 to Q1 2013 for condominiums (not including lofts) in the five MLS-subdistricts: Yerba Buena, South of Market, Mission Bay, Dogpatch/Central Waterfront, and South Beach.

Q1 2013 Market Stats for D9 Condominiums

As you can see from the chart above, the number of sales reported in the MLS was up about 32%, but that doesn’t mean that 32% more homes are available in these neighborhoods. What it does mean is that as developers finished their initial sales (which are rarely reported in the MLS) and the resale market grew, more sales ended up being reported in the MLS.

The average (median) list price increased by about 40%, but the average size was also much larger. If we look at price per square foot, it is up year over year by about 10%, from an average of about $730/square foot to $806/square foot. I’d attribute this to the decrease in short sales and REO properties in these neighborhoods, although there are still a few REO sales happening.

While asking price is up, condos are also selling for over asking in the current environment, by an average of about 1%, which is less than for the entire market, where the average sale in Q1 2013 was about 4% over the asking price.

Finally, days on market (DOM) is down by about 25%, from 39 days to just 29 days on the market. The gold rush appears to continue in San Francisco, that’s your Q1 condo market report!

Disclaimer: All data is from the San Franicsco Multiple Listing Service (MLS). Data is believed to be reliable but is not warranted or guaranteed. The data does not include all off-MLS sales, which would include sales of new construction directly from the developer (unless it was listed in the MLS, which is rarely the case). Your mileage may vary. If you’ve got a specific question about our data or methodology, don’t hesitate to leave a comment or get in touch. 

We recently tipped our hats to UCSF, which just celebrated 10 years in Mission Bay. But while the past may be exciting, the future is pretty interesting too, particularly when it comes to UCSF in Mission Bay.

Known by the rolls-right-off-the-tongue name of “Mission Bay Phase 2 Planning,” the plans for what comes next at Mission Bay for UCSF will be rolled into the university’s long range development plan (LRDP), which UCSF is currently in the process of updating.

The below picture is from the 1999 UCSF Mission Bay master plan, showing the various lots they own (by number/letter, like 17A, 17B, 17C) and what their original plans for the space were:

UCSF Mission Bay Campus

The picture below shows you what has been built, is under construction, and what remains to be built:

What’s Been Built at UCSF Mission Bay

The next graph shows you how much has been built, and how much more UCSF can build with their current entitlements under the Mission Bay master plan:

Mission Bay building by UCSF

In other words, UCSF will have to make some choices about what they build next, and/or they will have to go back to the city and neighbors to increase the amount of space they can build.

I love this next picture below, because it gives you a really idea of where the Mission Bay neighborhood is (the area outlined in yellow) and how the UCSF campus fits into the overall neighborhood plan.  The picture was taken back in 1997, when Mission Bay was no longer train tracks but little more than an idea:

Mission Bay, 1997. It was pretty empty. Image Source: UCSF Mission Bay Phase 2 Planning Document

The picture below was taken several years ago, showing much of the development in Mission Bay that has taken place over the past several years:

The UCSF hospital under construction is within the red box

Finally, another picture that shows Mission Bay as it was a few years ago, before construction on The Madrone or the UCSF hospitals had begun:

UCSF is very much a part of the Mission Bay neighborhood, and as the campus continues to develop it will continue to have a major impact on the neighborhood and area.

What are your hopes for UCSF as they continue to expand their presence in the neighborhood?

It’s baseball season! Which means that the Giants are back in town, and with them, heightened parking enforcement on game days. Below is the Giants 2013 – 2014 schedule, and if you prefer you can also download it in PDF format.

The SF Giants 2013 Season, Source: SF Giants

As I’ve written elsewhere, I’m not a huge baseball fan. I’ve always enjoyed going to a game at the SF Giants stadium, though, because there is always so much other stuff to do. In other words, if you ever have excellent tickets… don’t waste them on me. But do call my business partner. She takes this baseball stuff seriously.

April SF Giants Home Games

Fri, 4/5 Cardinals 1:35p
Sat, 4/6 Cardinals 1:05p
Sun, 4/7 Cardinals 1:05p
Mon, 4/8 Rockies 7:15p
Tue, 4/9 Rockies 7:15p
Wed, 4/10 Rockies 12:45p
Fri, 4/19 Padres 7:15p
Sat, 4/20 Padres 6:05p
Sun, 4/21 Padres 1:05p
Mon, 4/22 D-backs 7:15p
Tue, 4/23 D-backs 7:15p
Wed, 4/24 D-backs 12:45p

May SF Giants Home Games

Fri, 5/3 Dodgers 7:15p
Sat, 5/4 Dodgers 6:05p
Sun, 5/5 Dodgers 5:00p
Mon, 5/6 Phillies 7:15p
Tue, 5/7 Phillies 7:15p
Wed, 5/8 Phillies 12:45p
Thu, 5/9 Braves 7:15p
Fri, 5/10 Braves 7:15p
Sat, 5/11 Braves 1:05p
Sun, 5/12 Braves 1:05p
Mon, 5/20 Nationals 7:15p
Tue, 5/21 Nationals 7:15p
Wed, 5/22 Nationals 12:45p
Fri, 5/24 Rockies 7:15p
Sat, 5/25 Rockies 1:05p
Sun, 5/26 Rockies 1:05p
Wed, 5/29 Athletics 7:15p
Thu, 5/30 Athletics 12:45p

June SF Giants Home Games

Tue, 6/4 Blue Jays 7:15p
Wed, 6/5 Blue Jays 12:45p
Mon, 6/17 Padres 7:15p
Tue, 6/18 Padres 7:15p
Wed, 6/19 Padres 12:45p
Thu, 6/20 Marlins 7:15p
Fri, 6/21 Marlins 7:15p
Sat, 6/22 Marlins 1:05p
Sun, 6/23 Marlins 1:05p

July SF Giants Home Games

Fri, 7/5 Dodgers 7:15p
Sat, 7/6 Dodgers 4:15p
Sun, 7/7 Dodgers 1:05p
Mon, 7/8 Mets 7:15p
Tue, 7/9 Mets 7:15p
Wed, 7/10 Mets 12:45pm
Fri, 7/19 D-backs 7:15pm
Sat, 7/20 D-backs 6:05pm
Sun, 7/21 D-backs 1:05pm
Mon, 7/22 Reds 7:15pm
Tue, 7/23 Reds 7:15pm
Wed, 7/24 Reds 7:15pm
Fri, 7/26 Cubs 7:15pm
Sat, 7/27 Cubs 6:05pm
Sun, 7/28 Cubs 1:05pm

August SF Giants Home Games

Mon, 8/5 Brewers 7:15pm
Tue, 8/6 Brewers 7:15pm
Wed, 8/7 Brewers 7:15pm
Thu, 8/8 Brewers 12:45pm
Fri, 8/9 Orioles 7:15pm
Sat, 8/10 Orioles 1:05pm
Sun, 8/11 Orioles 1:05pm
Mon, 8/19 Red Sox 7:15pm
Tue, 8/20 Red Sox 7:15pm
Wed, 8/21 Red Sox 12:45pm
Thu, 8/22 Pirates 7:15pm
Fri, 8/23 Pirates 7:15pm
Sat, 8/24 Pirates 6:05pm
Sun, 8/25 Pirates 1:05pm

September SF Giants Home Games

Thu, 9/5 D-backs 7:15pm
Fri, 9/6 D-backs 7:15pm
Sat, 9/7 D-backs 6:05pm
Sun, 9/8 D-backs 1:05pm
Mon, 9/9 Rockies 7:15pm
Tue, 9/10 Rockies 7:15pm
Wed, 9/11 Rockies 12:45pm
Tue, 9/24 Dodgers 7:15pm
Wed, 9/25 Dodgers 7:15pm
Thu, 9/26 Dodgers 7:15pm
Fri, 9/27 Padres 7:15pm
Sat, 9/28 Padres 1:05pm
Sun, 9/29 Padres 1:05pm