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San Francisco Overbidding 101

If you’ve ever wondered how much over the asking price you’ll need to offer in order to purchase a competitive property in San Francisco, I have some data for you. In February of this year, the overall sales prices were an average of 8% higher (than asking prices).

More specifically:

  • Single-family homes sold for 12% over asking
  • Condos sold for 7% over asking
  • 2-4 unit buildings sold for 2% over asking

What are the specific causes? There are two primary culprits; (1) lack of supply to meet the buyer demand and (2) Realtors underpricing properties in order to (try) to create a bidding frenzy.