Source: Mansion Global —
The drumbeat of layoffs at companies such as Meta, Robinhood, Adobe, Salesforce and Twitter is especially loud in the San Francisco Bay Area, one of the most expensive housing markets in the U.S. and a major tech hub. While real estate agents don’t see a mass exodus from the area, there are bargains to be found in the luxury market in some parts of the city and its surrounding suburbs.
“The housing market in San Francisco is definitely in flux,” said Joel Goodrich, director of the estates division of Coldwell Banker Global Luxury in San Francisco. “In 2021, there were 27 sales of properties over $10 million, compared to 12 in 2022.”
The price per square foot declined from an average of $1,901 for homes and condos that sold in the third quarter of 2021 to $1,631 during that same period in last year, according to Carrie Goodman, a real estate agent with Sotheby’s International Realty in San Francisco. In 2021, the ratio between the list price and sold price was over 100% because—meaning bidding wars were regularly pushing sales over the original asking price. Since Sept. 1, however, the average seller has received 93% of their asking price, she said.
For buyers, lower prices are a boon, especially for buyers who have cash and don’t need to manage higher mortgage rates.
Still, Ms. Goodman said, “San Francisco is not dead.”
“The amazing opportunity is mostly that for the first time in years, buyers can really negotiate,” Ms. Goodman said. “But it’s a nuanced market. Even though there are some bargains, there are also places in the city with an A+ location, high ceilings, natural light and a garden that are getting multiple offers.”
On the flip side, Mr. Goodrich points to a Pacific Heights single-family home originally listed in mid-2021 at $28 million that recently sold for $13.5 million.
“One big shift in the market since the start of the pandemic that seems to be staying is that buyers don’t want fixer uppers,” Mr. Goodrich said. “There used to be a competitive market for people who wanted to buy old houses and fix them up, but now anything that needs work is deeply discounted.”
Where to Look
While there are “nuggets” of bargains in every neighborhood in the city, Ms. Goodman said that downtown has seen the most price reductions.
