San Francisco's housing market got off to a strong start in the first quarter of 2018, with the largest increase in home sales activity among Bay Area regions. Sales were particularly solid for properties priced between $2 million and $3 million, both for single-family homes and condominiums. Sales of condominiums exceeded last year’s first quarter across all price ranges.
A lack of inventory and strong buyer demand led home prices to soar once again. The median price for single-family homes increased by 25.5 percent from the first quarter of last year.
Competition among homebuyers remained strong and was in line with seasonal trends. Generally, buyers get more aggressive during the peak homebuying seasons, but in the first quarter, they were willing to pay higher premiums. With the average single-family home selling for 16 percent above the asking price, San Francisco buyers paid the second-highest premiums in the region and more than they did during the same period last year.
Looking Forward: San Francisco’s steady job and income growth should continue to fuel demand for real estate in the city. While mortgage-rate increases have not yet deterred buyers, future anticipation of hikes may attract some who have been sitting on the fence.