So sales of homes in San Francisco are well, moving like hotcakes. Multiple offers seem to be the new norm for any property that’s cute and priced right.
This week, Zephyr real estate reported 29 sales in the company (these are sales that just went into contract, but haven’t closed yet) and 13 of those had multiple offers and 14 went over the asking price. There’s still old inventory being eaten up (I just got an accepted offer on a place that’s been on the market 100+ days) but the new, cute, well-priced listings are MOVING!
Out of the last 5 offers I’ve written for clients, 4 properties received multiple offers.
But what’s MORE interesting, at least in my opinion, is that we seem to be seeing a major resurgence of the all cash offer!
Yup. In the last few weeks, the words “all cash offer” are a phrase I’m hearing on a daily basis. Lenders are talking about it. Escrow officers are talking about it. And without a doubt, real estate agents are talking about it. I recently put in an offer on a property with clients that had a cash offer. We came in 12th out of 13 offers, and our offer was accepted. And then just yesterday, I helped clients (they did have a loan) get another offer acepted. 12 offers were received by the listing agent and THREE of them were all cash. In January, I had clients beat out on an 8 offer situation where the highest bidder was an all cash offer.
But what does this all MEAN?
Someone asked me the other day, “Why the hell would enyone ever tie up so much money in San Francisco real estate?” Well, I’m going to go out on a limb here, but it might mean that the folks that are smart enough (or lucky enough) to amass a giant pile of cold hard cash seem to think that dumping all of their dough into real estate RIGHT NOW is a smart investment decision.
Prices don’t seem to be going any lower and with sales spiking upwards and prices creeping upwards, it might be safe to deduce that the bottom of the SF housing market has come and gone.
And here’s the thing, the theory that interest rates are low and THAT’S why it’s a good time to buy don’t apply to the cash buyer. Interest rates don’t affect them.
I’d love to hear from some of you cash buyers, or even agents with cash buyers whether my theories are sorta correct or completely far fetched. You can drop a note in the comments, or if you want to keep yourself anonymous, email me.