Housing market activity in San Francisco in the second quarter proved especially robust when compared with the rest of the Bay Area, showing a solid year-over-year increase in home sales. Except for sales of homes priced below $1 million -- which were constrained by inventory shortages -- home sales activity picked up at all price ranges.
Continued supply constraints led to notably higher absorption rates compared with the second quarter of last year and to a roughly 10 percent increase in both median single-family home and condominium prices. The competitive market produced a three-year high in the share of homes that sold for more than asking price. For single-family homes that sold over list price, buyers generally paid almost 20 percent premiums.
Sales of condominiums also picked up when compared with the same period last year. And while existing condominiums saw median prices continue to rise, newly constructed condominiums experienced relatively slower price growth. The increase in median existing condominium prices was partially driven by more high-priced sales than at the same time last year
Looking Forward: Although third-quarter sales are expected to reflect mild seasonal lulls, continued economic strength will keep fueling demand for San Francisco real estate. The prospect of further mortgage-rate increases may attract some homebuyers who have been sitting on the fence.