Is This A Sign Of A Pullback In SF?

I personally don’t below so since the 1M and under demand is fairly strong and rates are still attractive, but you never know right? We are seeing more inventory in the high end and condos. Will savy buyers simply hold off and wait for even better buying opportunities later? Hey, I am sure most people didn’t think Durant was coming too and yet here we are…

I don’t think anyone here on the forum is looking at the SF high end. To be high end in SF we are talking about 1.5M at least. If the slowdown creeps downward to say 1M or so? Oh boy… Can I pick something nice up in St Francis Wood for 1.2M??? Can I???

Markets gotta pause at some point…but then you read that foreigners are now focusing on the lower end instead of the high end so who knows. Look for homes with good bones and character. Lousy curb appeal or non fixable aspects stay away from. Pay premium for location, potential for expansion and for you school junkies school districts on the rise. Not sexy all the time but over time should perform for you.

Here is the story on foreigners buying cheaper:

Another evidence the high end is slowing

4M condos are not that expensive in most other world class cities. So SF still has quite a long way to catch up to the Hong Kongs and Londons of the world. :slight_smile:

Remember just a year ago when $1.5m was highend in SF…now just an average price in the Sunset…

Come on, Eileen, keep serving the Kool-Aid…

" The California Association of Realtors expects only a five percent price increase this year—nothing like our recent history."

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I think she might be early. But a slowdown is closer now than 3 years ago. And a slowdown is usually preceded by a frenzied market. Do we get frenzy in 2018 or 2020?

I felt like frenzy was 2017. I hope i am right.

I feel than today is more frothy than 2017

I don’t feel that way at all, some of my neighborhoods have not even gone back to the 2007 level yet in terms of median housing prices.

The subprime bubble and liar’s mortgage might be an abnormaly that caused a one time boost to certain neighborhood. It may not be a good historic reference point. You may need to refer to the previous peak prior to 2000

The frenzy has to extend to the exburbs before the prices drop. Buyers will explore every option before the frothy market ends.


Here is a theory I heard but did not verify.

In a normal real estate slowdown, price flattening or drop happens first in the core of Bay Area. The slow down spreads from the core to the edge. This is a slowdown caused by affordability which is benign and shallow.

In a Great Recession, things got reversed. Price drop starts with the remote edge and extends to the core. This is a dangerous market and fire sale can be found.

Can this be verified from the last 30-40 years of market cycle through direct experience and historic charts?

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The price wave starts in Palo Alto and spreads to Sacramento. The contraction will start in Sacramento and finally end up in PA. Watch Sacramento prices when they drop then the prices will start falling in the core areas. Could be another 2 years before that happens. Also condos are the canary in the mine. They will loose value first.


My gauge is condo prices in Concord :wink:

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The speculators run their mouth, people who are late to the game start buying homes for flipping. People who can’t afford such high prices go to the suburbs, or start driving long distances and with the same rhetoric they start to flip in towns deemed “the last hope”.

Though the stated income was essentially the culprit of many people driving to towns like Bakersfield, Visalia, and so on, the real problem started when people realized that they were either driving too long, wanted to stay where they bought a home but no jobs, and the infamous ARM loans taking effect.

So, the first sign you will see, if anything similar happens again, that the people far away, being the lower price on housing, and the first to be bought by investors, will start selling by the tens or hundreds and that is what will cause a wave that nobody will stop.

But, in order for anything to happen, jobs have to be gone in a scale that supply will be more than demand.

Everything seems cool right now, but that’s how you feel the day an earthquake hits you.


I own property in Bakersfield. It will be last place to boom and the the first to bust. May not boom until the cho cho train is built… 2030?

Hey, good post @buyinghouse… and you didn’t even use the word “gun” once…:grinning:

As far as Bay Area is concerned, Antioch and Vallejo will be the last places to boom and first place to bust. That I’m sure of. :wink:

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