Welcome to the first Artemis Real Estate newsletter of 2021! This year has started off with a bang and for the first time in a while, a refreshing sense of optimism is in the air. Vaccinations are being rolled out and a glimmering light may be seen at the end of the tunnel. It's an exciting time, especially with all we've been through in 2020.
In our Year-End 2020 newsletter, we predicted the San Francisco real estate market would spring back to life in early 2021 and so far we have been spot on. The market has done a 180 from where it was compared to last Fall. Whenever a market changes this quickly it's remarkable to witness. The tides shift so powerfully you can actually feel it. We also predicted that not all properties would be part of the snap-back recovery, which has also been true.
We're seeing and participating in bidding wars that are reminiscent of the last bull run. We wrote an offer for a client at 38 Delmar #3, a cute 1-bedroom condo in Cole Valley, and were 1 of 40 offers! Our listing in Sausalito at 211 West Street received 4 offers (all buyers coming from the City) and we are in contract well above the asking price. Our listing at 436 Gates in Bernal Heights also did extremely well. Colleagues of ours have reported robust activity - for example, 111 2nd Avenue (at Lake) reportedly received 19 offers, 7 of which were cash, and will be closing around $600K above asking. And 127 26th Ave (also at Lake), received 8 offers and will be closing approximately $500K above its $1,995,000 asking price. 135 Geldert in Tiburon was listed for $4,795,000 and just closed for $5.7M!
But for every multiple offer situation, there are just as many flops. Buyers have become very choosy on what they desire in homes, largely driven by new lifestyle requirements brought on by the pandemic. Marin has been more forgiving than San Francisco, with fewer flops - but the K-shape housing recovery seems to be playing out just as predicted. The key to success? Immaculate presentation and underpricing by a few percentage points, both specialties of ours.
There is an interesting dynamic we've noticed taking place annually in January through mid-February. People seem to be cooped up during the holidays, set their intentions and goals for the coming year, and come out in a frenzy just as the new year kicks off. However, there is hardly enough inventory during these weeks to satisfy the demand! This creates a logjam of buyers (often fueled by recently paid bonuses) trying to get into too few properties at the beginning of each year, creating a spike that gets smoothed out as buyers get absorbed and the Spring market transitions into the warmer months.
The takeaway? If you have a home ready to hit the market in January or early February but are holding out for the warm weather - don't! Get it on right away and take advantage of this annual buyer bottleneck.
Monthly Prediction | Room For All The Planets:
This is where we'll attempt to make a prediction about the future based on all the inputs we receive each month - whether it be boots-on-the-ground experience, roundtable discussions we're participating in, or the countless articles, podcasts, industry reports, and other media consumed. Read at your own risk!
Silicon Valley is moving to Texas! Everyone's leaving California! The rich are fleeing! It would seem every time you browse the headlines there is another sky-is-falling article about the demise of California, companies exiting, and high taxes pushing people out.
While it is true that California is grappling with some significant issues, we think (and maybe we're just biased here) the headlines are exaggerated. A closer look shows the companies leaving are typically ones that are desperate to cut costs, the rich fleeing are in the minority, and you can't just uproot an entire ecosystem of world-class universities, angel, private equity, venture firms, incubators, startups, unicorns, and all their support systems and ancillary businesses to a new location. We are the Jupiter of the solar system. The biggest, most magnetic, gravity-wielding beast in the United States (and possibly the world) when it comes to startup capital, ingenuity, and innovation. What we're seeing right now is the growth of the other "planets." New York, Boston, Austin, Seattle, Miami ... they are becoming forces in their own right.
Our prediction? Other cities will grow in their gravitational influence, but the Bay Area will remain the Jupiter of the solar system for a long time to come. And yes, there is room for all, particularly as we continue our transition to an information-based economy.
Click here to read the San Francisco market report.
Click here to read the North Bay report.
That wraps up this edition of the Artemis Real Estate newsletter. May you and your loved ones have a great start to the new year and see you next time!
Arrian, Payton, Sejal, Colin, Jennifer, and Lorelei