San Francisco Real Estate Market Report - January 2019
Despite a strong U.S. economy, historically low unemployment and steady wage growth, home sales began to slow across the nation late last year. Blame was given to a combination of high prices and a steady stream of interest rate hikes by the Federal Reserve. This month, the Fed responded to the growing affordability conundrum. In a move described as a patient approach to further rate changes, the Fed did not increase rates during January 2019.
New Listings were down 16.0 percent for single family homes and 22.9 percent for Condo/TIC/Coop properties. Pending Sales decreased 2.3 percent for single family homes and 35.0 percent for Condo/TIC/Coop properties.
The Median Sales Price was up 3.6 percent to $1,378,000 for single family homes but decreased 4.5 percent to $1,050,000 for Condo/TIC/Coop properties. Months Supply of Inventory increased 5.9 percent for single family units but was down 8.3 percent for Condo/TIC/Coop units.
While the home affordability topic will continue to set the tone for the 2019 housing market, early signs point to an improving inventory situation, including in several markets that are beginning to show regular year-over-year percentage increases. As motivated sellers attempt to get a jump on annual goals, many new listings enter the market immediately after the turn of a calendar year. If home price appreciation falls more in line with wage growth, and rates can hold firm, consumer confidence and affordability are likely to improve.
source: SFAR January 2019 Monthly Indicator Report