As we settle further into a brand new year, it’s important to understand the real estate trends that are shaping the San Francisco market and how you can best position your investments to remain profitable and secure.
We believe that things won’t look too different than they did last year, at least not right away. But, there are a few things you need to be aware of as the year moves forward.
Stable Home Prices in San Francisco
Prices in San Francisco have always been higher than the national median, and that’s not going to change. At Gordon Property Management, we do expect that instead of volatility we’ll see stability in terms of home values and appreciation. While dropping interest rates may have more consumers interested in buying, there’s not going to be a huge desire to sell. Spring often brings a faster moving market, so sales may pick up then.
Investing in San Francisco Condos
After a bit of a lull, we’re seeing the condo market begin to come back to life, and that should continue to gain momentum throughout 2025. These properties have high rental potential, and investors can expect well-qualified renters and high rental values in the condo market. Those higher rents will be due to the amenities that are available in condo buildings; think fitness centers, roof decks, and lounges.
Insuring San Francisco Investment Properties
Insurance has been a nightmare for anyone who owns property in California. Whether we’re talking about your private home or your San Francisco rental units, insuring them has become increasingly more complicated and expensive over the last few years. Insurers have left the state and those who stuck around are requiring major upgrades to buildings. Owners may find themselves replacing old wiring, electric panels, and roofs. We wish we had better news, but it looks like coverage will be more expensive and harder to find. That’s going to drive up HOA dues.
Sustainability and Smart Home Tech are Selling Points
The upgraded amenities and the new floors are nice to have, but what both buyers and tenants are really looking for are environmental sustainability and smart home technology.
- San Francisco is an eco-conscious market. Buyers and renters are increasingly prioritizing homes with energy-efficient features such as solar panels, smart thermostats, and sustainable materials. All light bulbs should be LED light bulbs, and appliances need that ENERG STAR rating.
- San Francisco is attracting new tech tenants, with companies like OpenAI setting up offices in the city. Their employees and remote workers around the market are looking for homes that are tech-enabled on day one of their residency. Make sure there’s at least some smart home tech installed if you’re selling or renting a home. Digital keypads, video doorbells, and smart appliances are all good starting points.
As a real estate investor in San Francisco, we recommend looking at the potential of condos, bringing yourself up to speed on the new state rental regulations, including tweaks to the eviction laws, security deposit laws, and screening requirements.
We can talk about the trends that are most impactful to you, as an investor. Contact us at Gordon Property Management, and we’ll make sure you’re ready to succeed this year.
