April 2021: Q1 Sea Cliff - Lake Street Insider

I hope this email finds you well and optimistic as we close out the first quarter of 2021. I want to quickly update you on the San Francisco market and Prop 19.

First; the market. Since January, the San Francisco market has been experiencing incredible demand for single family homes, well-located neighborhood condos and now we are seeing solid demand for two and three unit buildings with vacant units. On the single family home front, most houses in all price points are getting multiple offers. Houses listed in the sub $2M range are typically receiving 10+ offers. I’ve seen some listings where the property received over 30 offers! Record prices are being realized weekly.

In the entry level luxury range ($3M), again, sellers are seeing multiple offers albeit trending more towards quality and not quantity (of offer). In the ultra-luxury range, again we are seeing strong demand and there have been some record sales. Those record sales tend to reverberate downward to the market as a strong vote of confidence. Examples include a $17,500,000 sale on Twin Peaks and a pending $25,000,000 sale in Presidio Heights (@ $2800 per foot!).

We are also starting to see the north side luxury condo / Co-op market warm up again. Examples of this ultra-luxury activity are a newly sold $7,500,000 two-bedroom condo on Nob Hill and a pending $8,995,000 three-bedroom TIC.

Again, the record sales activity at the top end of the market promotes confidence to all segments of the market from the top down. The message is that people are making the investment to make San Francisco their home.

Next, I wanted to touch on Prop 19. Since the beginning of January, it’s not a stretch to say I’ve had more than a 50 seller / owner conversations on this topic. People in the 55+ age category want to know what their new tax base will be if they sell. To answer that, I put a chart together to help you determine what your new tax base would look like if you sold and leveraged Prop 19 portability. Just plug in your own variables.

Have questions on the value of your primary residence so you can better understand what your new tax base would be? Give me a call.

On to our corner of the City. Overall, activity was fairly flat from the previous quarter with the Lake Street corridor activity down by half (Q4 ’20 had a spike in seller activity). The trend was a lack of sellers in Q1. Sea Cliff has its usual suspect listings that have been on the market for a long time 224 Sea Cliff and 10 Sea Cliff (at three years and a year respectively) but not much in terms of new sellers.

The “unreported” news in Sea Cliff was the sale of 475 Sea Cliff. If just following the MLS, the home (above the China Beach parking lot) was a probate sale listed at $5,995,000 that was “cancelled” on February 22nd. But, it quietly sold on February 26th. The sale price $24,600,000. Yes: not a typo.

So, why would someone pay that much money for an average house (for Sea Cliff) with no privacy? 475 Sea Cliff has the most value to an owner that has an adjacent lot. I doubt the consul general of Switzerland (immediate east property) was the buyer. Look to an owner above on El Camino Del Mar as the buyer. There are three properties (on El Camino Del Mar) that border 475 Sea Cliff. One particular El Camino Del Mar owner would have two lots in total of approximately 233 feet in depth (El Camino Del Mar to Sea Cliff). Oddly, one of the owners above on El Camino Del Mar has the same wealth & tax planning firm as the new owner of 475 Sea Cliff. Coincidence?

On to the numbers.

The top sales of the quarter; as mentioned, 475 Sea Cliff was a shocker. Also, 10 5th Avenue was not a typical sale. The property was a shell of a home that the seller purchased a year earlier and was going to fully remodel. For some reason the seller did not finish the project and sold at a loss.

All of the properties referenced above can be seen here.