After long lull, SF luxury home market finds footing

For luxury buyers in San Francisco, the indecision that has kept them on the sidelines for the last year has finally thawed, awakening a particular interest in one-of-a-kind homes. 

In April 2024, the number of homes in the city sold for more than $5 million hit 17, its biggest tally since the spring of 2022, according to Compass data. Presidio Heights had the highest price per square foot at $1,463, narrowly beating out its northern neighbors Cow Hollow and Pacific Heights. Presidio Heights also had the biggest sale of the year thus far with a $24M trade on a house with its own pickleball court that closed in mid-May.

Compass agent Neal Ward said the spring selling season kicked off with “great energy” for his team, which brought four single-family homes ranging from $6.4 million to $14.9 million to market in March alone. He called the interest “phenomenal,” with three of the homes going into contract by the second week and an average of 17 days on the market for all four. 

This same pool of “well established buyers who see San Francisco as their long-term homebase” were not making moves last year or much of the year before, he said, but have returned because of the city’s ability to stay resilient and reinvent itself.

“More eyeballs”

Spring is always the hottest market for $5 million-plus listings and this year is no different, said Compass agent Max Armour, with macroeconomics like the stock market and VC investment currently in the city’s favor as the market “finds its footing.” 

Armour currently has one of the priciest listings in the city at 2898 Broadway on Billonaire’s Row, which is this year’s Decorator’s Showcase house and listed at $32 million. The “reality is there are a limited amount of buyers who qualify for a $32-million purchase,” he said, but the added momentum of the month-long showcase this spring has been a boon for the listing.  

“It is the talk of the town,” he said. “All of this exposure means more eyeballs on the listing and we have certainly seen an increase in digital traffic.” 

Summer tends to be quieter but can also be a time to make moves if the right property comes to market, given how easy it is to view properties online, he added. 

“A motivated buyer will buy on the Fourth of July if it’s time to buy,” Armour said. 

Sotheby’s International agent Deborah Svoboda said she was still in the process of readying a 1968 Joseph Esherick-designed home along the Presidio wall for sale, with an expected listing price of $12 million. Then she got an “unsolicited” offer from a local buyer who paid $11.5 million for the property based on just a FaceTime tour with their agent, Lamisse Droubi at Generation Real Estate. 

Svoboda said she wasn’t surprised at the quick sale, given how few Esherick properties in the city come to market. Plus, the light-filled home at 3323 Pacific Avenue has unobstructed Golden Gate Bridge views and a walk-out South-facing garden. 

“I expected to receive serious interest from Mid-Century Modern architectural buffs had it gone on the open market,” she said. 

Also, the home was a second property for the out-of-town sellers, so it was not often used recently and had not been updated in 30 years. That means in addition to the purchase price there is likely an “extensive and thoughtful renovation” ahead for the new owners, she added. 

A fixer-upper with great bones might have been a deal breaker last year, but this spring more are moving, an indication that buyers are once again interested in long-term investments in the city. Compass agent Nina Hatvany said her listing at 2550 Filbert Street in Cow Hollow had great views from every level, was on a large lot and was in move-in condition, though “a little dated.” 

“Last fall even a uniquely attractive house like this might not have excited buyers, but this spring it did,” she said, adding that there were “only three offers” and that it went for about 15 percent above the asking price of $7 million. “So the market is good but not extraordinary.”

Election uncertainty

Hatvany expects the market to keep chugging along until late June, with a possible uptick depending on the stock market. For July and August, she anticipates the usual summer vacation plans to lead to a slowdown. She expects to see price cuts for longer-term listings at that point, but thinks that fewer listings will go off and come back in the fall than usual since it’s an election year.

“Elections always slow things down a bit as uncertainty weighs on buyers’ minds,” she said.

Compass agent Butch Haze said he has spoken with clients who are waiting to see the election results before they make their move and some might even become sellers if the results go the wrong way. Across the city, he said, there’s a “united front” from bartenders to bankers that change is necessary for a full recovery.

“We lost our way and unfortunately were maybe too kind and need to restore just basic human rights of safety and common sense,” he said. “If we see change happen, I think there will be a flood of people moving in to bet on San Francisco. It would be irresponsible not to believe San Francisco is a good long-term investment.”

Some buyers are “boomerangers” who left the city during the pandemic but got “bored in Idaho,” “too hot in Austin and Houston” and “too much rain in Seattle” and are now coming back, he added. 

The heat being generated at the upper end of the market now may make its way down to lower price points and help buoy the condo market in a few months, Haze said, as the uber-wealthy tend to have savvy advisors who lead them to be prescient on making timely investments.

“Some of the most successful people are often the best risk takers. They do educated risk taking and have been successful in that and so now we’re seeing them jump in first,” he said. 

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