San Francisco, CA (PRWEB) June 15, 2015
Buyers and their agents have become all too familiar with the low levels of housing inventory in the city during the past couple of years. If only more properties were for sale, the thinking goes, then prices wouldn't continue to zoom skyward and the competitive real estate market might cool down a bit. When the market started to heat up back in 2013, it was thought that sellers would be enthusiastically listing their homes for sale. That hasn't happened; and it doesn't seem it will happen anytime soon. Real Estate Agent Tim Gullicksen shares his anecdotal evidence from his own experience with clients and other real estate agents.
He said the biggest problem appears to be with move-up buyers. These are the buyers whose life circumstances have changed, whether it’s due to their respective incomes being altered, getting married, having kids, etc.
“They'd like to sell the small home they currently have, but are afraid that they won't be able to buy a larger home in this hyper-competitive environment,” Gullicksen said. “The very same forces that make it so easy to sell their properties are exactly the same ones that make it tough to buy the replacement one. This segment of the market is largely sitting put for now. It's a vicious cycle.”
He believes that more people would sell if there were more properties available to buy. Homeowners who might typically have sold their homes in past markets due to retirement, job relocation or such are often making the decision to hold onto their properties as investments. He said that some people are afraid that if they lose their toehold in San Francisco, they will never be able to return. Others see the astronomical rents they can collect and figure that steady income is a pretty good deal.
“This segment of the market has slowed,” Gullicksen said. “When the market eventually cools down this should be less common.”
Prop 13 has been incentivizing homeowners who’ve lived in their properties long-term to stay put since it was passed by the voters back in 1978. If older sellers could more easily transfer their tax bases to new, smaller homes, that would certainly help put some additional inventory on the market, Gullicksen said. But there is no political will evident to make such a change happen.
“For the near term, it looks like increasing prices and continuing low inventory will continue,” he said. “These cycles never last forever, though. Eventually the market should reach a better equilibrium.”
Gullicksen’s observations have led him to believe that this pattern will eventually cease. Until it does however, buyers should be ready to compete.
About the company:
Tim Gullicksen has been a top-producing real estate agent since he first entered into the business and takes great pride in managing every aspect of each transaction. After graduating from high school in the South Bay, Tim earned a bachelor’s degree in political science and history from the University of California-Berkeley. He went on to earn his teaching credentials from JFK University in Orinda and taught kindergarten in the San Jose Unified School District. He brings an educational approach to real estate developed from that background and sees himself as a facilitator of property transactions. For more information, visit his website at http://www.timgullicksensf.com/.