Earlier in the week we took a look at what the largest overbids for single family homes in San Francisco were in 2013. While the numbers provide some interesting perspective, I also wanted to take a look at how common overbids have been in the 2013 SF real estate market. While most buyers are unlikely to find themselves in the position of making the largest overbid, I think their frequency can shed some light on the SF real estate market and how listing agents price properties.
As you can see from the pie chart above, 3 out of 4 homes in San Francisco that have sold this year went over asking. Of the remaining 25% of homes that sold, just shy of 5% went for the asking price, almost 10% went for under asking by 0 – 5% of the purchase price, about 7% went for under asking by between 5 and 10% and just shy of 5% went for more than 10% under asking.
As you can see from the graph, the reality is that home buyers who have been shopping in San Francisco this past year have encountered at least one home they were interested in being in a multiple offer/over asking situation.
I’m going to dig down into the over-asking numbers in a future post to get a handle on just how far over asking most homes went, because there is certainly a psychological difference between offering $50,000 over the asking price and offering more than $1,000,000 over the asking price. In a perfect world, I’d also be able to slice and dice this data by neighborhood, but unless I get an intern for the holidays, that’s probably more number crunching than is realistic.
Finally, a note about our data. All data is from the San Francisco Association of Realtors multiple listing service. Many new construction developments are not entered either at all or completely in the MLS, however most new construction in San Francisco is for condos, so this data is pretty representative of the single family home market. The data only looks at homes located in San Francisco, so homes outside of SF that were entered in the SFAR MLS are not included in the data.