Is San Fran following New York’s Lead?

We have seen the New York luxury condo market make impressive gains in 2007 while the rest of the country struggles.  The high end luxury condo market continues to hold strong as prices and demand continue to be through the roof.  Major metropolitan cities have the benefit of being a great investment target for international investors, but the fact remains in the luxury market that affluent people are still willing to buy regardless of “national” market trends. 

Banks are taking the opportunity to lend on $10 million mortgages because they can then bundle and sell those high end mortgages to the open market to make up for all the defaults and foreclosures on the lower end.  San Francisco condos in the luxury sector seem to be following the same trend.  Sales for the 4th quarter have outpaced the 3rd quarter in the high end market by almost double.  Average price per square foot keeps going up and is now at $1,200 while time on market has gone down to an average of 45 days!

Buyers in the high end San Francisco condo market want great views and 24 hour concierges.  And they are getting it all!  In most of the other markets across the country regardless of how many incentives and amenities are thrown at the buyers, values continue to fall.  Many experts say 2008 will be no different for most of the country.  The real naysayers think 2008 may not even be the bottom, be we won’t get into that!  Most of us are hoping for a turn-around towards the end of 2008. 

Seeing condo markets like San Francisco and New York excel the way they have in the current conditions gives us all hope.  I live in San Diego and just went into escrow on a home.  Buyers need to understand that there are great deals out there, especially if the buyer is thinking long term.  Now through next year will be a great time to buy condos!