As the new year approaches, as a Realtor, I'm curious, are buyers in San Francisco that are anxious to buy?

Asked by K Feat, San Francisco, CA Thu Dec 27, 2007

I have several clients who are looking, but are waiting to see if prices fall even more, is this the case with other Trulia buyers? What are some factors that may be holding you back or perhaps what signs are you looking for that will encourage you to begin the buying process? It would be interesting to know what folks think at this moment. Is it economics, timing, pricing, or perhaps not the right type of properties on the market? Very curious and very appreciative for your feedback!!!

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12
Bevmo, Home Buyer, Oakland, CA
Thu Dec 27, 2007
I am looking to buy a 3 bedroom single family home but not sure I can afford it in San Francisco - perhaps an answer to a a slightly different question :-) My preference are the districts to the south: Glen Park, West Portal, Bernal Heights, around Noe / Eureka Valley. I'm not sure if 20% price falls to the level of a few years ago, say from 1.2M$ to 1M$, will materialize and inventory / choice will rise in the next 6-12 months (the period I will need to move with my new child). Or whether we will have to look towards the more suburban Peninsula (I have an office in San Jose I go to occasionally). The coming financial industry schedule or 'wave' of mortgage rate resets has its peak mid-2008 - that's a clear date to wait for. I follow the economist magazine and socket site for information. Cheers, Martin
2 votes
Jeremy R, , Redondo Beach, CA
Wed Feb 4, 2009
For me, it has to do with affordability. My wife and I earn about 170k/yr, and we have an ample downpayment. 2 years ago, all we could afford was a tiny condo or a home in terrible condition in a terrible neighborhood, but given our education and work experience, we feel we should be able to buy a single family home with decent size and condition. The market is coming down, and we are determined to wait for a home we can be proud of. Right now, prices are falling about 10-14,000/month according to some websites, and we save more and more each month. We are not waiting for a "bottom" but we are waiting for a 3/2 single family 1350 sq ft in decent conditon for a decent price.
0 votes
Danc, Home Buyer, San Francisco, CA
Fri Jan 30, 2009
We would like to enter the market now but have three hurdles:
1. 20% down is challenging to put together esp with declining investment accounts.
2. Jumbo mortgages are difficult to get even with reasonably high incomes.
3. We are stuck in choosing between staying in SF, where we would need to pay for private schools, or moving to a more affluent community with good schools.

Given this, we choosing to wait until we have met the above conditions. i suspect, given what I have read, that the market will be even more favorable in 2010.

Lower mortgage rates are insufficient to bring this market back. Banks need to open their coffers and buyers need to lower their listing prices.

I hope this answer is helpful.
0 votes
Al, Home Buyer, 94015
Mon Jan 26, 2009
Its hard to convince yourself to put an offer and commit to the biggest purchase ever when when you hear layoffs are being announced everyday.

Yea, we know rates are mortgage rates are low, but it does not mean much since Bay Area prices are still overinflated when it comes to prices for the homes in good areas.
Does it really matter if you pay 4k or 4300 per mo.?

I personally wait for the job market to stabilize as well as for buyers to drop the prices 5-10%
0 votes
Peter Brunton, , San Francisco, CA
Sat Jan 24, 2009
Kevin,

I don't think you are going to see buyers get back into the market until the have seen the first positive signs in the overall economy or they are convinced mortgage rates have stopped falling. As for those that say that San Francisco prices are completely out of whack I offer the the following:

1. A typical mortgage payment on a 2 bedroom tic/condo is not dramatically higher than the rent for a similar property. When mortgage payments are near rental rates which is not far away, you should see more buyers in the market.
2. Some might say that we will see deflation and this should lower rents and continue to lower home prices. This might be true for the near term, but I would have to say that at least 90% of the economists and analysts think that we will see major inflation in the long term because of the recent fiscal policies. This will most likely cause home prices to come back and buyers will want to get in before that happens.

So yes, buyers are still on the sideline and they are most likely right to be because prices should continue to fall. However, this should not be as dramatic as some people believe and buyers are not too far away from jumping back in.
0 votes
Fred, , San Francisco, CA
Fri Jan 23, 2009
Great question Kevin and I hope to see this thread continue as this is just as relevant a question today as December 27, 2007.

We think this is a good time to buy in SF particularly in some of the new developments. Prices may continue to come down some but we don't expect the decline to be as severe as this past year. We are also potential sellers but plan to hold off listing our house for at least a year.
0 votes
Gregor Dodson, , San Francisco, CA
Thu Jan 1, 2009
The prices in SF are still completely out of whack with reality, especially the more popular neighborhoods.

The factor holding us back is that we don't want to buy a house for $800k that will be worth $500k in 18 months.
0 votes
Zibbyz, Home Buyer, 94107
Wed Dec 31, 2008
We are looking to buy -- and yes, we are waiting to see if it continues to fall. With that being said there are a few neighborhoods we are focused on and if the right place opens up we will jump.

It is just too grim to consider that we might have purchased 6 months ago, and already be so far underwater (particularly in the new developments ---- Chelsea Park, Esprit Park, Ricon)
0 votes
Barb, Home Buyer, California
Tue Dec 30, 2008
We are looking to buy in Placer County in the first 6 months of this year...we are not first time buyers..we are kind of waiting to see if more inventory comes on the market after the first of the year, and if prices and interest rates drop. It's kind of a crapshoot. We don't want to miss our opportunity but I think we have some time stll. I think a lot of sellers are not realistic as to what their homes are worth to buyers..We don't want to rip someone off, but we want to pay only what a place is really worth since we are retired and on limited income..
0 votes
K Feat, , San Francisco, CA
Sat Dec 29, 2007
Thanks Alice -- that's great information. I just got off the phone with a buyer who isn't in a hurry and wants to find the right place for her and her budget. I think what I'm sensing is that we are back to a more normalized market where buyers have the luxury (perhaps that is a strange term to use since buyers SHOULD have that) of time to find the home that fits their needs and budget. Thanks again for your great answer! -- Kevin
0 votes
Jed Lane, Agent, Petaluma, CA
Thu Dec 27, 2007
I want to hear from the buyers out there and if I don't post an answer then I won't be informed of new answers.
Kevin, great question and I hope that people chime in with thier thoughts.
0 votes
Veronica Gar…, Agent, San Francisco, CA
Thu Dec 27, 2007
Kevin, thank you for asking these questions. I too have a few buyers "actively" looking, however, holding out for the right moment. I will be interested to see the responses. Best, Veronica
0 votes
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