Of Interest

San Francisco New Construction/Development Report

Highlights from the Q3 2014 Pipeline Report by the SF Planning Department

December 2014, compiled by Paragon Real Estate Group

On December 19th, the San Francisco Planning Department issued its excellent Q3 2014 Pipeline Report, which tracks new residential and commercial development in the city. There is a wealth of data within its 36 pages: Below is simply an excerpt of some highlights.

The Pipeline includes projects in every stage of the approvals, permits and construction process, and being listed in the pipeline doesn’t indicate when or even if the project will be completed. Changes and additions to the pipeline occur on an ongoing basis: Indeed, it seems rarely a day goes by nowadays without a big new project being announced. Last but not least, changes in economic and political circumstances can suddenly and dramatically impact new development plans and construction.

  • 50,600 residential units are in the current pipeline, including condos, houses and apartments, as well as affordable and social-project housing. Houses constitute far less than 1% of the total units. (There are currently approximately 381,000 housing units in San Francisco, per 2013 U.S. Census data.)
  • 18,700,000 square feet of commercial space are in the pipeline, including office, retail, medical, hotel, cultural, institutional and educational uses. 12 million of the square footage in the pipeline are for office use. (As of 2013, there were approximately 75.6 million square feet of office space in the city.)
  • 3090 residential units and 280,000 square feet of commercial space have been added in the past 4 quarters. “The median time to completion for these projects from the first filing was 43 months.” For smaller projects of less than 10,000 square feet, the median time dropped to 30 months.
  • 6700 new residential units and 5,400,000 square feet of commercial space are currently under construction.
  • Approximately 25,800 of the pipeline’s residential units are comprised of the Bayview/Hunter’s Point/Candlestick, Park Merced and Treasure Island projects. “Full realization of the projects will be decades into the future.” The Bayview/Candlestick and Treasure Island developments are situated on parcels designated as “Public Land.”
  • Not counting the 3 big projects mentioned above, the great majority of both residential and commercial pipeline projects are currently clustered in the greater South Beach/South of Market/Mission Bay area, the Market Street corridor, the Potrero Hill/Dogpatch area, and the Mission.
  • Approximately 800,000 square feet of manufacturing, distribution and repair use space would be lost in the course of existing pipeline development, to be replaced by housing or other commercial uses.

The full Planning Department Pipeline Report can be downloaded here. There’s also a nifty interactive map illustrating projects in the pipeline. Our sincere gratitude to Aksel Olsen and Teresa Ojeda of the SF Planning Department for compiling this useful and comprehensive report.


The first and third charts below come straight from the Planning Department Pipeline Report. We created the two district-breakdown charts to separate out residential and commercial projects and to reflect more common neighborhood and district names as used in the real estate business (but even then, the names should be considered gross generalizations). And we added a snapshot of the Planning Department map to give an idea of the number of development projects in the city.

This snapshot from the interactive map on the Planning Department’s Pipeline report webpage indicates current projects in the greater South Beach/South of Market/Mission Bay district, Hayes Valley and the Market Street corridor.


*All information included herein is from sources deemed reliable, but may contain errors and is subject to revision.

December 22, 2014 / by / in ,
Bay Area Demographics

18 charted analyses of ancestry, affluence, education, real estate,
politics, poverty and employment for San Francisco, Marin, Napa,
Sonoma, San Mateo, Santa Clara, Alameda & Contra Costa Counties.

4th Quarter 2014, Paragon Special Report

These charts are mostly based on U.S. Census surveys from 2010 to 2013. Each of the 8 counties examined contains areas of widely varying demographics, and the multiple reports analyzed (6+ for each county) contain counts and estimates made at different times. Though these statistics are broad overviews, we still found many fascinating insights – and hope you will as well.

Adjusting your screen-view to zoom 150% will make the charts easier to read.

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Ancestry, Race & Age

For the most part, the ancestry and race categories used below
are as designated in the U.S. Census reports.

Ancestry: This first chart is a collated overview of the 8 counties. The Bay Area is one of the most multi-cultural places on earth, but (not broken out on this chart) this diversity is not evenly spread: Different ethnic and national groups often cluster in specific counties. For example, San Francisco has the largest populations with Chinese or Russian ancestry; Santa Clara has, by far, the greatest number of residents from India, Vietnam or Mexico; Alameda leads in those of Portuguese or Pacific Island heritage. For breakdowns by county, U.S. Census reports can be accessed at http://quickfacts.census.gov/qfd/index.html.

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Race: Marin County has by far the largest percentage white (non-Hispanic) population at 73%, followed by Sonoma and Napa. San Francisco has the largest Asian percentage at 34.4%, with Santa Clara just behind at 34.1%. Santa Clara is the only county where white isn’t the largest group – Asian is bigger by a tiny margin. Napa has the largest Hispanic percentage at 33%, with 5 other counties between 23% and 27%. Alameda has the most substantial percentage black population at 12%.

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Foreign-Born: The foreign-born population in the Bay Area is large (behind only New York, Miami, LA and Chicago) with again, different groups predominating in different counties. About 50% of our foreign-born residents have acquired U.S. citizenship.

3

Children & Residents Living Alone: It has famously been said that San Francisco has more dogs than children, and at 13.4%, SF has the lowest percentage of residents under 18 of any major U.S. city. The other counties run close to the national percentage of 23%. San Francisco also has a much higher proportion of residents living alone than the other 7 counties – which probably correlates with a more urban lifestyle.

It’s interesting to note (not delineated on the chart) that though SF has relatively few children, its population aged 25 to 39 is very high, at just below 30%. Other Bay Area counties run from 16% (Marin) to 23% (Santa Clara). Demographers have noted that younger, post-college adults are moving into urban centers in large numbers, and this is clearly occurring in San Francisco. The city’s young, high-tech, start-up environment is undoubtedly supercharging this phenomenon.

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Affluence, Poverty, Education & Politics

Median Household Income: Many factors impact this statistic: household size, level of education, percentages of homeowners vs. renters, median age and of course, employment. Marin and Santa Clara are at the top of the list for highest household income. Obviously, various towns and neighborhoods – such as Pacific Heights, Ross, Atherton, Piedmont, Blackhawk – far exceed the figures in the chart below.

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Poverty: According to the 2013 Wealth-X report, the Bay Area has the 3rd highest number of ultra-high-net-worth residents in the country, behind NY and LA. According to SFLuxe, the Bay Area is now home to over 70 billionaires – and it seems one can’t turn around in Safeway anymore without bumping into another new billionaire.

But surging affluence isn’t the only story.

The U.S. poverty-level income threshold does not vary by geographic region: For a family of 4, the national threshold is approximately $23,500. According to a Stanford think tank, adjusting for much higher local costs of living (especially housing) raises that threshold to $31,000 – $36,500 in Bay Area counties. In San Francisco, that increases the percentage of residents living in poverty to 23% and in Napa to 26%. Adjusted or not, the percentages add up to many hundreds of thousands of people – and this seems an appropriate place to remind all of us not to forget the neediest this holiday season.

6

Unemployment Rates: A big factor behind Bay Area economic conditions has been the strong growth in employment in recent years – in high-tech certainly, but also in the financial, medical, retail, construction and other industries. Many of these new jobs are very well paid.

7

Education: Some Bay Area counties are among the most educated in the country – not a big surprise considering the presence of 3 of the world’s great universities, and the Bay Area’s role as a hub for various high-education industries. Among U.S. major cities, San Francisco usually ranks near the top of the list just below Washington D.C. and Seattle.

8

Political Party Registration: This chart is self-explanatory. The Bay Area is a very blue region in a very blue state.

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Housing, Real Estate, Prices & Rents

Median Home Prices: Apples to apples, San Francisco has the most expensive real estate in the Bay Area, followed by San Mateo and Marin. But all the counties include diverse neighborhoods featuring home prices ranging from relatively low to very high. One thing that stands out is the city’s distinctive condo market: the median price for 2-bedroom condos is just a tad lower than its median price for 3-bedroom houses. The reasons are twofold: firstly, very generally speaking, condos predominate in the more affluent city neighborhoods, while houses predominate in the less affluent. Secondly, thousands of new condos have been built in the last 10 years, or are under construction now, and by and large, they are of luxury or “ultra-luxury” quality and cost.

10

For a Million Dollars: Consider this infographic to be very approximate indeed, but it gives an idea of what one would get in square footage for $1,000,000 at each county’s overall house and condo average dollar-per-square-foot value. For the money, one gets more than twice the space in Contra Costa or Sonoma as in San Francisco or San Mateo. In many parts of the country, one could double or triple the square footage again.

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Case-Shiller Home-Price Trends: The Case-Shiller SF Metro Area does not cover all 8 of the Bay Area counties, but it generally applies to the overall market. If Case-Shiller went back a bit further, we would see the late seventies/early eighties recession on this chart. From recession – which in the last 30-odd years has typically lasted 4-5 years – comes recovery (typically very robust recovery). Recovery usually takes 5-7 years to become utterly “over-exuberant,” which leads to a correction – and the next recession. We are still less than 3 years into our current recovery – which doesn’t mean that past trends will hold true in the future.

This chart aggregating all the sales of 5 counties is a huge simplification of hundreds of different micro-markets: Different areas and price segments of the Bay Area housing market had 2004 – 2008 bubbles and crashes of vastly different magnitudes. The lowest price segment rose and crashed the most (think “subprime loans”) and, though recovering dramatically, is still well below 2006 peak values. The higher priced housing segment had a much smaller bubble and crash, and has now exceeded its previous peak values of 2007-2008, in many cases by substantial margins. All 3 home price segments – low, middle and high – are now approximately 95% – 97% above their values of year 2000 (denoted as “100” on the chart).

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Average Asking Rents: In the Bay Area, rising apartment rents and rising home prices have gone hand in hand, a big social, economic and political issue right now. Per the analytics firm Reis, San Jose, Oakland and Francisco are 3 of the 4 hottest rental markets in the country, as measured by rent appreciation.

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Homeownership: With San Francisco’s homeownership rate of 37%, tenants outnumber homeowners by a large margin – and, not surprisingly, the city has some of the strongest rent and eviction controls in the country. (SF rent-limitation controls do not typically affect vacant or recently built apartments, so they do not reduce the “asking rent” values seen in the earlier chart.)

14

Market Size: Santa Clara and the two East Bay counties each have more than twice as many home sales as any of the other 5 counties. This is mostly due to significantly higher populations, but San Francisco’s relatively low number of home sales is also caused by the fact that almost two thirds of its units are rental housing: Thus, SF has more people but fewer home sales than San Mateo. Very limited supply amid huge demand is a big factor in its rising home prices.

15

Era of Construction: This chart illustrates how empty the Bay Area was 75 years ago, before World War II: Almost 50% of San Francisco’s housing was built prior to 1940, but in 6 of the other counties, the percentage falls to 12% or lower. In Santa Clara and Contra Costa, it drops to 5% – there were a lot of open fields where housing developments exist now.

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Population, Density & Size

Population & Population Density: Santa Clara and Alameda have the largest populations of the 8 counties. San Francisco, the second most densely populated city in the country (far behind Manhattan), has a population density 95 times that of Napa County.

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Size in Square Miles: This chart reminds us what a small place San Francisco really is – and its inability to expand (except upward) plays an interesting role in many of its economic and social dynamics. Sonoma is the largest of the 8 counties and it is 33 times as large as San Francisco County.

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October 30, 2014 / by / in , ,
Warren Buffet on Housing

In an CNBC interview on February 27th, Warren Buffett said the following when asked whether he’d recommend people buy stocks or houses right now:

“If I knew where I was going to live for the next five years or 10 years, I’d buy a home and I’d finance it with a 30-year mortgage. It’s a terrific deal…

If I had a way of buying a couple hundred thousand single-family homes… I would load up on them. And I would take mortgages out on them at very low rates… [With] a 30-year mortgage… it’s a leveraged way of owning a very cheap asset now. That’s as attractive an investment as you can make.” And in his latest letter to shareholders: “Housing will come back – you can be sure of that… Every day, we are creating more households than housing units. People may postpone hitching up during uncertain times, but eventually hormones take over… Fortunately, demographics and our market system will restore the needed balance…”

February 29, 2012 / by / in ,
Common Mistakes Buyers Make in Multiple-Offer Situations

1. Not having your agent do a full comparative market analysis of the property: a clear-headed assessment of what fair market value is.

2. Not making a list of the strengths and weaknesses of the property, to keep in mind during the negotiations or perhaps to even use in the negotiations.

3. The flip side of #1 & #2: Getting too excited and making a purely emotional decision. When buyers see that other buyers want the property, the “value” of the property soars in their mind, which is why the highest prices always result from either multiple bidding or the fear that others will be making offers. A good listing agent does everything he or she can do to manipulate this fear. This is the flip side of why values decline after longer days on market: If someone else wants it, it’s very valuable; if no one else wants it, there must be something wrong with it and it can’t be so valuable.

4. Not setting your walk-away price before getting starting with the negotiating. At some price point, the deal is no longer worth doing, no matter how great the property.

5. In one’s urgency to make the deal, not including sufficient contingencies to perform thorough due diligence. I’ve seen homes that look perfect turn out to have $250,000 in pest damage; if one wrote the offer without the appropriate inspection and investigation contingencies, one might win the deal, but wake up to a house with very unpleasant surprises waiting.

6. Having an agent that is more interested in making the deal (and collecting their commission) than making you the best deal; having an agent who doesn’t know the market values in the area; having an agent who doesn’t know how to negotiate (sadly common).

7. Not learning as much as possible about the seller, the property and the listing agent as possible: needs, wants, circumstances, style of doing business

8. Not making sure that there really are competitive offers, because sometimes the listing agent will blow smoke about “expecting multiple offers.” You can even have your agent write two (or more) offers at different price points, with clear instructions as to which one to submit depending on the final number of offers received by the listing agent.

9. Throwing in the towel when told that the seller is only countering another offer(s). If you want the property and you’re willing to pay more, one can always throw in another offer during the seller’s counter offer process with others.

10. Not asking for back-up position if you lose in the bidding. Sellers will often put a second buyer into back-up position at the same price or even a lesser price than the accepted offer. If the first deal blows up, then the back-up offer is immediately elevated into accepted position. Deals blow up all the time (probably about 10% – 15% of the time) for a wide number of reasons and one can find one is buying the house they wanted at an acceptable price after all. (Buyers in back-up typically have the option to cancel that position at any time, so they can continue to look for another home. It really is a no-lose proposition.)

October 3, 2011 / by / in ,
From the IRS: Ten Tax Tips for Individuals Selling Their Home

“IRS Summertime Tax Tip 2011-15, August 8, 2011

The Internal Revenue Service has some important information to share with individuals who have sold or are about to sell their home. If you have a gain from the sale of your main home, you may qualify to exclude all or part of that gain from your income. Here are ten tips from the IRS to keep in mind when selling your home.”

Click here to continue.

August 22, 2011 / by / in
Great Online Resources for Living in San Francisco

San Francisco & Bay Area…

Restaurants, wine, arts, sports, nightlife, neighborhoods, schools, farmers’ markets, things to do with kids and dogs, biking, hiking, transit, real estate, maps, remodeling and renovation tools, and other online resources.

Chronicle’s Top 100 Bay Area Restaurants & Map

Chronicle’s Bargain Bites Restaurants & Map

Chronicle’s Best Breakfast Places

Best of Bay: Dining & Entertainment & SF Magazine Best of Bay

Chronicle’s Top 100 Wines & 20 Great Wines Under $20

Everything Within Walking Distance of Your Home

103 Things to Do with Kids in San Francisco

Things to Do in SF & Free Things to Do

Places to Go with Dogs

San Francisco Biking Resources & Bay Area Hiking Trails

Paragon Real Estate Market Monthly Update

San Francisco Real Estate Market Trends Overview

SF Home Prices & $/SqFt by Neighborhood & Property Type

San Francisco Realtor Map

Online 3-D Remodeling & Renovation & Remodeling Idea Books

Remodeling Cost vs. Value Analysis for SF

25 Planning Dept Maps: Zoning, Noise, Open Space, Transit, Parking

San Francisco Bars, Clubs & Lounges

Guide to SF Neighborhoods & Neighborhood Fast Facts

Detailed, Updated SF Demographics, City & Neighborhood

San Francisco Parks

City History, Stories, Essays & Images

Museums of San Francisco & Bay Area Sports Teams

SF Public Schools & SF Private Schools

School Academic Performance & SF Public Schools Parents Group

City Services Directory & SF Crime Map & Dept of Bldg Inspection FAQs

Neighborhood Civic Info & SF Municipal Codes & Zoning

Zoning, Permit, Crime & Demographic Info by Address

Bay Area Public Transport & Trip Planner

San Francisco Farmers’ Markets

San Francisco Recycling Resources

Disaster Preparedness & Seismic Map & Susceptibility Map

Legal Articles: TICs, Condo Conversion, Tenant Evictions

San Francisco Rent Board

Assessor’s Office: Property & Transfer Taxes, Recorded Documents

Volunteer Opportunities

Rules of Negotiation for Buyers & Sellers

Characteristics of a Good Real Estate Agent

Mortgage & Rent vs. Buy Calculators

July 30, 2011 / by / in ,