Nearly 80% of San Francisco’s Single-Family Homes are Selling Above Asking Price

San Francisco’s real estate competition is still hot. Since January up until the end of last month, 79% of single-family homes in this area sold for above the asking price as a result of low inventory, according to data from Sotheby’s International Realty.

As reported in Mansion Global, during that same period, 9% of the single-family homes sold for their asking price and 12% sold for less than their asking price. And at the same time last year, 70% of homes sold for more than their asking price, according to the data.

This analysis is based on the San Francisco Association of Realtors MLS closed sales data.

The higher bids are highlighted by one particular sale in the affluent Pacific Heights neighborhood at the beginning of May, according to the data. The Grand Victorian on Scott Street had an asking price of $7.995 million when it hit the market back in April, and made the sale of $9.6 million, 120% of its asking price, listing records indicate.

Worth noting is that Noe Valley has been the most competitive market in San Francisco this year. So far, 10 homes sold for $500,000 or more above the asking price. In Bernal Heights, nine homes sold this year for $500,000 or more over asking price.

“The lack of inventory overall is the major contributing factor to homes selling over market,” said Janet Feinberg Schindler of Sotheby’s International Realty, the listing broker of the Scott Street house.

“Since 1969 there has been a 22% increase in population and San Francisco is only 47 square miles. We are the second most densely populated city in the country. It’s simple supply and demand, there are more buyers than sellers.”

One way of pushing up the value of offers is to set the listing price lower than expectations on purpose. While doing so is a “calculated risk” Ms. Schindler said, it can create a bidding war.

Another important factor is having a desirable property. “This is typically a home in move-in condition in a style appreciated by buyers, or a home that is priced to enable the buyer to make changes,” Ms. Schindler said.

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