A Changing Market for High Rise Condos in Yerba Buena/South Beach/Mission Bay

You know all those newer condos down by the water where the Bay Bridge is? Well, an influx of new construction in that area neighborhoods is directly impacting demand for the resale market there.

But before we get all gloomy-doomy, let me say that I seriously envy anyone lucky enough to live or own in one of those buildings.If was shopping today and had a spare million or two, I would seriously consider buying into the Saint Regis or One Hawthorne in Yerba Buena. The area is fabulously walkable and is only going to become more so over the next few years. Other luxury buildings like the Infinity or the Metropolitan in South Beach are also going to see giant changes within the next five years as the Transbay Project and more luxury high rises knit the district into a cohesive neighborhood. And Mission Bay buildings like Arden and the Madrone are a tremendous long-play, with a wonderful infrastructure, gorgeous wide-open spaces and tremendous anticipated demand from the neighborhood’s medical/hi-tech/biotech workforce.

It’s clear that upper-end urban dwellers also love these neighborhoods: more luxury condos are sold here than in any other part of the city. For now, however, this is also the area most impacted to current and planned new luxury condo project developments, so sales there are slowing down.

Below is a chart relative to condos selling above the $1.5M price point in the Yerba Buena/South Beach/Mission Bay markets. Even if you aren’t particularly interested in this slice of the market, studying this data can educate you on how to watch for signs of a softening market in your own neighborhood.

(Nota Bene: This information is based exclusively on MLS data- and does not include listings and sales at Lumina and The Harrison, two new high rise buildings that are adding 1,000+ condos to the skyline.)  

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This chart shows Listings for Sale vs. Listings Sold for the past 13 quarters. You can see the ratio of sales to listings start to shift towards a buyer’s favor beginning in Q3 of 2015.