Condo Appreciation Flattens in San Francisco

SAN FRANCISCO—New condominium prices remained mostly steady in San Francisco, Downtown Los Angeles and Downtown Seattle in August 2014 over the previous month, according to the Condominium Pricing Index released this week by The Mark Company, a leading urban residential marketing and sales firm.

The Mark Company's index for August was up 1% month over month in San Francisco, unchanged in Downtown Los Angeles from the previous month, and down 3% in Downtown Seattle from July 2014.

“Price appreciation of new condominiums in the San Francisco, Downtown Los Angeles and Downtown Seattle markets have flattened out over the past several months, as is typical for the second half of the year,” noted Erin Kennelly, senior director of research, The Mark Company. 

The San Francisco Condominium Pricing Index for August was $1,119 per square foot, which is up 10% from the previous year.  New construction inventory was 11% lower than last month, and up 4% year over year, with 386 units now available.

The Downtown Los Angeles Condominium Pricing Index was $693 per square foot, which is up 14% from the previous year.  New construction inventory was down 33% from last month, and 90% lower than a year ago, with only two units available.

The July Downtown Seattle Condominium Pricing Index was $701 per square foot, up 2% from the previous year.  New construction inventory was down 6% from last month, but more than 350% higher than August 2013, with 196 units now available.

The Condominium Pricing Index, part of the firm's monthly Trend Sheet , represents the price per square foot of a new 10th floor, 1,000-square-foot condominium.  It is based on recent sales data, and uses a proprietary quantitative method to measure trends in market demand.  It tracks the value of a new construction condominium without the volatility of inventory changes.

The Mark CompanyPenthouse Pricing Index, which applies the same methodology to a new 30th floor, 2,000-square-foot condominium (1,000 square feet in Downtown Los Angeles), was $1,921 per square foot in San Francisco in August, up 1% from the previous month and up 10% year over year; $1,121 per square foot in Downtown Los Angeles, unchanged month over month and 14% higher than a year ago; and $1,085 per square foot in Downtown Seattle, down 3% month over month and 2% higher than a year ago.