Have we discussed the price adjustments (up! up! up!) in both buying and renting in San Francisco due to the Facebook IPO? Not enough! Let’s see what happens when CNN lets one of its bloggers write a tl;dr post that makes our zip code pieces look like tweets by comparison.
By Julian Hebron, contributor @CNNMoney May 17, 2012: 1:27 PM ET
(StockTwits) — The Basis Point is a popular mortgage and housing blog that tracks consumer critical issues and data. It is edited by Julian Hebron, a retail mortgage lender who runs the San Francisco branches of RPM Mortgage.
Three weeks ago, some clients wrote a $1.25 million offer on a 1,400 square foot 3-bed, 1-bath house with original kitchen and bath near San Francisco’s Dolores Park. They weren’t even close. There were 51 offers. It sold for $1.4 million and closed 8 days after offers were due.
That’s the most offers I’ve seen in 10 years. And a different property at that week got 23 offers.
Two weeks ago, another client offered $245,000 over list price on a 3-bed, 2-bath Pacific Heights condo. One of the other 9 offers was the winning bid in this $1.6 million to $1.9 million market segment. That was my client’s fourth rejected offer. He’s looking at two properties in this price range this week, and the listing agents are reporting similar demand: about 10 serious buyers circling.
That’s the norm. It’s what some are calling The Facebook Effect on San Francisco real estate.
That’s the norm: 10 serious buyers circling. StockTwits goes on at very great length to explain why this is happening, and mentions “The Facebook Effect” as if the term were newly minted. Here’s what Hebron said in much fewer words. (The charts are all linked from his article.)
1. Everyone not already working for Facebook is trying to buy before millions of Facebook employees get their license to print unlimited money
You will love this quote from the article:
The San Francisco buyer mindset is that they want to get in before they’re priced out, but they either haven’t reaped their firm’s windfall yet or don’t expect much if any windfall from their firm.
That’s right. They’re all worried about being Priced Out Forever. And this has never, never, ever happened before!
2. Ed Lee’s reelection as SF Mayor means tech employers can demand payroll tax adjustments
Twitter threatened to leave SF over the 1.5% payroll tax, what with all the high salaries and the stock option financials on top of that, Lee negotiated an adjustment with a maximum annual tax, and now all the other tech companies will expect similar easements. Which means they’ll stay in SF, which means high-paid twentysomething technogeeks will continue to buy real estate there, which means you can’t afford anything.
And this is all very interesting, except Facebook is not in SF. So why isn’t this article called “The Twitter Effect”?
3. Constricted housing supply. Really, really, really constricted. Plus rising rents. Did we mention constricted housing supply?
The key takeaway is that there were only 500-600 annual SF home sales above $1.5 million. Now, how many people do you think will be wanting one of those better places once the IPO cash hits?
And is it maybe possible that more homeowners would cash out when they start seeing more of these prices?
We’re almost done With the Blogging from A to Z Challenge, and Wow is our Website Woozy. What Will our readers Whine about When it’s gone? No Worries, some of you Wonder Why it Wore out its Welcome While others Winked at how Wonderful the Words Were.439 GLENWOOD Ave
This may be the first property in Woodside to have its listing copy composed entirely in tweets.
This tweet
