The SOMA neighborhood in San Francisco saw a substantial reduction in prices and sales in 2023. Over the past year (ending December 29, 2023), 106 condos sold in SOMA at a surprising average price of $744,283, down 29% from an average of $962,848 in the prior year. The highest and lowest sales prices in the past year were $1,400,000 for an 1805 square foot 3-bedroom condo, and $250,000 for a 307 square foot studio. The average time on the market for these condos was 73 days this past year, slightly longer than the prior year’s 65 days. Volume is down about 32% compared to last year with 50 fewer condos having sold this past year. These numbers do not include any off-market sales that may have occurred.
The reason for this result was the skyrocketing interest rates that made buying a condo much more expensive in 2023, with 30-year fixed rates up from 3.25% at the beginning of 2022 to around 7.00% today. This area of the city had already been impacted by the pandemic with most of its buildings having elevators that no one wanted to ride with other people. That together with high HOA dues for common areas like gyms and pools that couldn’t be used during the pandemic brought prices and sales down in SOMA starting in 2020 and have stayed down.
I had a sweet loft at 175 Bluxome, Unit 327, on the market this fall. While a number of buyers came through, there was no urgency to make an offer and high interest rates added to this as buyers waited for them to come down. Several “low ball” offers were made but the seller was already taking a huge hit since she had bought the loft for substantially more than its current list price. For a 2 bedroom, 2 bath loft in SF, it is a steal at $829,000. Let me know if you’d like to see it.
There is hope with interest rates coming down, the stock market charging up and lower inventory and high buyer demand. Things may very well turn around in 2024, and buyers who are holding back while prices are relatively low may come to regret their decision not to have moved forward, but we’ll see. Unfortunately, my crystal ball is not working! 😊
