Back in 2007 when the market was peaking, clients of mine struggled to find a home. Then, one day a home popped up on the MLS in the Forest Hill Extension neighborhood and we went to see it. They weren’t really looking in this neighborhood; in fact, I don’t think they even were aware of it. But I could tell from the look on the face of the husband that he had found his dream home. His wife was excited, too. They prevailed in a multiple offer situation and bought it for $1,135,000. What is it worth now? Recent comps indicate that it would likely sell today for in excess of $1.6M, a price increase of $465,000 or 41%. But that’s not the whole story – assuming a typical 20% down payment of $227,000, that equates to a 205% total return on the down payment (11.8% annually) on a beautiful home you get to live in and enjoy with family and friends. That’s nice appreciation but appreciation isn’t the only benefit of living in this neighborhood.
What They Say About the Neighborhood
Where is it? Forest Hill Extension is generally bordered by Potrero on the southeast; Dewey Boulevard on the Northwest; Woodside on the northeast; and Kensington on the southwest; and part of Laguna Honda Boulevard. It is adjacent to Forest Hill. Here is what my clients say about their neighborhood: “We love Forest Hill Extension because it provides all the benefits of living in a quiet residential neighborhood while still being only a short Uber or Muni ride away from all the hustle and bustle of downtown San Francisco. We know most of our neighbors on our block which provides a sense of community and security while most houses are single family homes with small front and back yards which provides privacy. Getting around is easy via Forest Hill Muni station or Glen Park BART station, and there’s plenty of street parking for our visitors. Nearby neighborhoods like West-Portal, Glen Park, and Noe Valley offer shops and restaurants and they might be considered more trendy which is the only downside of living in Forest Hill Extension – most people don’t know where it is. We like it that way, though.”
Home Sales
According to the Multiple Listing Service, 14 homes have sold in this neighborhood over the past year (year ending November 13, 2017) at an average price of $1,624,518, up almost 7% from $1,522,800 in the prior year. The highest and lowest sales prices in the past year were $2,407,000 for a 5-bedroom home and $1,175,000 for a 2-bedroom home. On average, they sold for 11% over the sales price. The average time on the market for these homes has been 33 days this past year, much less than the prior year’s 46 days. Not surprisingly, volume is down making it more competitive with six fewer homes having sold this past year than the prior one. At least in this SF neighborhood, the market has been much hotter this past year than last.
Conclusion
Home prices have increased in Forest Hill Extension over the past year by almost 7%. The market here is moving more quickly than last year. It is a neighborhood comprised of attractive single family homes that can be bought for under $2M, which is more affordable than many neighborhoods in the city.
If you know of anyone who is considering selling, definitely give me a call as this is a good time to sell!
