With its December average home sales price of $1.5 million, San Francisco County appears on the surface to be an unaffordable market with minimal for-sale inventory priced below $500,000.
However, a recent market report from Intero Real Estate Services provides data that refutes this claim.
During December of last year, nearly 46 percent of all for-sale listings, 54 of 118 listings, in San Francisco County were priced below $500,000. Additionally 22.8 percent of all listings were priced between $500,000 and $1 million.
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Combined, the two price points and homes listed below $1 million represent nearly 70 percent of San Francisco County’s existing for-sale supply.
Intero reports that homes priced below $500,000 are on the market for an average of 36 days.
Bay Area home price increases are still a hot topic
In the East Bay, homes listed below $500,000 also represented a significant, nearly 33 percent, volume of for-sale inventory as of December.
While the 269 listings priced below $500,000 is notable, that figure declined by 32 percent year-over-year. At the same time, the volume of $500,000 to $1 million listings grew by 18.7 percent, signaling that lower price point homes experienced significant year-over-year appreciation.
Overall, homes prices between $500,000 and $1 million account for nearly 42 percent of all listings in the East Bay, which for this report included Union City, Fremont, San Ramon, Pleasanton and Livermore.
Similar to the East Bay, more than 40 percent (220 listings) of for-sale inventory in the Peninsula is priced between $500,000 and $1 million. The region, which includes San Mateo, San Carlos, Redwood City, Belmont and Hillsborough, also has a high volume of $1 million to $3 million listings, 218.
The fact that sub-$500,000 listings represent a healthy portion of inventory in San Francisco County and the East Bay is likely good news for millennials, a demographic that is expected by most to purchase more homes in the Bay Area this year.
The volume of sub-$500,000 listings should also make buying a more affordable option to some than renting.
“Even as much as home prices have appreciated over the last several years, it’s still much cheaper to own than to rent when you take into consideration the tax write off,” said Tom Tognoli, CEO and president of Intero. “It’s still smarter to own than rent if you can qualify.”
