Beautiful San Francisco
June 27, 2016

The Mark Company Trend Sheets: May 2016

The Mark Company tracks real estate trends in the West Coast’s urban markets. Our Trend Sheets track sales, pricing and inventory for new condominiums, providing critical month-over-month and year-over-year comparisons.

All four markets experienced moderate year-over-year pricing increases during May, ranging from 1 percent in Downtown San Diego to 10 percent in Downtown Seattle. Resale pricing maintained similar momentum, with Downtown Los Angeles prices jumping over 20 percent compared to the same period last year.

Overall trends indicate steady stabilization of pricing supported by continuing employment growth, strong demand for housing in urban centers and positive economic climate.

May 2016 Highlights

San Francisco

The Condominium Pricing Index for San Francisco was $1,307 per square foot in May. This marked no change from April after four consecutive monthly increases since January. There are approximately 1,227 new construction condominiums available for sale in San Francisco, which is a 38 percent increase from the previous month due to the addition of new inventory, but well below the high of over 3,000 units reached in 2007. It is estimated that approximately 114 new construction condominiums were put into contract during May, marking a 171 percent increase from the previous month. Inventory is anticipated to increase during the remainder of 2016, with several new developments slated to commence sales later this year.

Downtown Los Angeles

The Condominium Pricing Index for Downtown Los Angeles increased 1 percent in May, marking the fourth consecutive monthly increase this year, indicating a stabilizing market driven by positive real estate fundamentals, continued demand and tightening available inventory. The Condominium Pricing Index for Downtown Los Angeles currently stands at $786 per square foot and is now 6 percent higher than the same month one year ago, comparing positively to the 4 percent lower year-over-year pricing recorded in March.

Downtown Seattle

Downtown Seattle condominium prices increased by 6 percent in May over the previous month, now standing at $845 per square foot, compared to a peak of $853 per square foot set in January of this year. As Insignia approaches sellout, inventory in Downtown Seattle is very low. There are currently only 209 new construction condominiums for sale, a decrease of 13 percent compared to April, and 57 percent lower than the same month one year ago.

Downtown San Diego

Downtown San Diego condominium prices remained unchanged in May following a 3 percent increase in April. The Condominium Pricing Index in May was $645 per square foot, a modest 1 percent increase compared to the same period last year.  The average resale price per square foot increased by 2 percent last month and is now 5 percent higher than the same month one year ago. The large differential between resale prices and the reported list prices of Pacific Gate indicate that there is  demand for high-end condominiums that is not currently being met in the resale market.

The Condominium Pricing Index, part of The Mark Company’s monthly Trend Sheet, represents the price per square foot of a new 10th floor, 1,000-square-foot condominium. It is based on recent sales data, and uses a proprietary quantitative method to measure trends in market demand. It tracks the value of a new construction condominium without the volatility of inventory changes.

The Mark Company provides our developer clients with the tools, guidance and strategies they need to outperform the competition. Our detailed Monthly Reports and Trend Sheets deliver an accurate snapshot into the competitive landscape of key real estate markets throughout the Western United States, bringing to life the market and buyer trends that inform future strategy.

Get access to the latest real estate trends by registering here to receive these and future standard monthly reports. Need insight into a specific site? Get in touch today and position your residential development for success.