Median price of a. San Francisco home finally drops amid IPOs

In a feat once akin to moving mountains, the Bay Area housing market pushed the median price of a home in the region and in SF down year-over-year in April, albeit by small margins.

Core Logic

At the beginning of May, Orange County-based data firm Core Logic’s monthly home sales report reported that the price of a home in the Bay Area declined in April compared to the same time last year, the first time that had happened since 2012.

However, the drop was a barely-there 0.1 percent.

Now figures from other sources are in— although the specifics vary, they mostly corroborate Core Logic’s conclusions.

California Association of Realtors

The California Association of Realtors (CAR) released April figures that show an even bigger (albeit not huge) decline in prices across both the Bay Area and San Francisco.

CAR, which compiles the sales of single-family homes on the MLS, showed a 2.2 percent year-over-year decline in median prices for all nine Bay Area counties, from just over $1 million in April 2018 to $988K this year.

The difference in San Francisco itself was smaller but still significant: negative 1.1 percent year-over-year, from $1.65 million in 2018 to more than $1.63 million this year.

Similar to Core Logic’s figures (which differ from CARs, in part, because they also include condo sales), that dip is so small as to qualify as nonexistent in practical terms. But the fact that prices definitively did not rise is arguably more important.


SF-based Compass real estate group’s monthly report, released earlier in May, found a similar decline in the median single-family home price, presenting essentially the exact same figures CAR provided.

Compass found a smaller 0.95 point decline year-over-year than CAR did, but that’s because the report uses slightly more exact figures, rounding off to the nearest hundred dollars; in practical terms, the two analyses show pretty much the same activity.

Compass economist Patrick Carlisle writes that this isn’t a big enough change to be called a true drop—at less than one percent, it could just be statistical noise—but does note that “the most expensive housing market in the country has stopped becoming more expensive,” which is itself a little shocking.

Why the change? Carlisle’s analysis:

Monthly median sales prices are often affected by other factors besides changes in fair market value—for example, the extreme seasonality of luxury home sales. But [...] spring 2018 was one of the hottest markets in history, with dramatic year-over-year price appreciation. The market then cooled, stock markets turned scary, and interest rates climbed. 2019 has heated up again, but, so far, without any year over year median price gains.


Looking at a slightly bigger picture, real estate company Re/Max issued a report last week showing that while most major cities saw housing prices climb year over year in April—the average across 54 metro areas was plus 2.1 percent—San Francisco was among three that saw declines, down 1.4 percent locally.

Unlike CAR, Re/Max includes condo sales in its totals as well.

What does it all mean?

Possibly not much; no market goes up forever; the declines are all small; and, at most, the changes represent a stall after year upon year of constant growth. Until bigger trends emerge through spring and summer, any other conclusion seems hasty.

Still, market pushback finally landed a blow on the champ, which is always a development worth of comment—and possibly caution.

All year long, speculation has run rampant that a new round of initial public offerings (IPOs) from tech giants would strap a rocket to the Bay Area market, the New York Times dramatically predicting that the city will soon be “drowning in millionaires.”

In fact, Carlisle’s fellow Compass economist Selma Hepp declared in May that the upward trend had already begun, citing April increases in the number of home sales (but not in prices).

Fred Brousseau, director of policy analysis at SF’s Budget and Legislative Analyst’s Office, warned in an April memo to SF lawmakers that SF home prices could rise an average of 1.8 percent for each major IPO.

On the other hand, Issi Romem, chief economist for the real estate site Trulia, offered the opinion this month that, although the IPO boost “is substantial and will influence San Francisco real estate,” the anticipated effects are overblown.

Romem predicted that the wealth created for most shareholders will be modest, that sales will happen gradually rather than all at once, and that they’re likely to be spread out around the region rather than huddled up in SF, resulting in muscular but non-catastrophic increases.

Thus far, newly public SF companies have performed marginally, with Lyft and Uber still trading below expectations. Pinterest surprised with a stronger showing but declined this week.

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