Hmmm, how are things going right now? During the 3rd and 4th quarter of 2018, there was a lot of buzz in the San Francisco real estate community about our local market taking a turn. (Contacts tell me that the same thing was happening in Marin, the East Bay, the South Bay, and even the greater Los Angeles markets.)

Agents were all a flurry about our “shifting market,” and true, we did see an increase in inventory after Labor Day and more price reductions and longer days on market for some properties. Unfortunately for those who love to number-crunch, in residential real estate, it is almost impossible to use aggregate data to determine what will happen with a specific home sale. Many homes received multiple offers and sold well above target expectations. Even between Thanksgiving and New Year’s Eve, our team was negotiating sales for home buyers and sellers.

As I write this in mid-January 2019, in a nutshell, it’s just too soon to tell. Yes, markets go up and go down and go sideways. SF is not immune and it’s very unlikely that we’ll continue to see dramatic increases in overall prices in 2019. But have buyers vanished? Will well-priced and well-presented homes in desirable locations linger on the market? Only time will tell but as you’ll read below, I kinda doubt it.


How are we doing? We are pumped for 2019! It’s the Year of the Pig: a year of fortune and good luck, don’t ya know?

“According to the Chinese astrology, 2019 is a great year to make money, and a good year to invest! 2019 is going to be full of joy, a year of friendship and love for all the zodiac signs; an auspicious year because the Pig attracts success in all the spheres of life.”

Despite the significant stress on our local market (and psyches) in 2018 with the new tax bill (and terrible SALT tax changes), the near-constant threat of increasing mortgage interest rates, and the negative water cooler talk from other agents (see above), we were able to help 40 home buyers and 31 home sellers successfully navigate the San Francisco real estate market putting us into the top 10 of SF Realtors in terms of both sales volume and homes sold. There are over 4,500 agents.

Does this sound insane? It kinda is, but we LOVE what we do and work very hard to be more experienced and more strategic than the competition. Buyers know we can get them the home they want at a fair price, and sellers know we’ll fight to the finish for the highest value for their listing.

But that was then and this is now. So here we go again! But first, before we jump into 2019, how did I do predicting San Francisco real estate in 2018?


1. At the continual risk of playing Chicken Little, I predict that mortgage interest rates will increase in 2018 but not enough to significantly affect home buyer demand. My guess is they’ll be up ~ 0.50%-1% by the end of 2018. Those at the fringe of affordability may bow out and wait for that ephemeral market downturn and some buyers’ expectations may need to be adjusted (as always in this town!), but demand will continue to outpace supply in the City by the Bay.

Check. Rates were up 0.56% from the end of 2017 to the end of 2018. But they actually went back down this January.

2. Listing inventory will remain tight. Even with all of the nay-saying about how “SF is over!” the fact remains that we do not have enough housing for all of the folks who desire to live here.

There are many factors that contribute to the chronic lack of housing in San Francisco: strict zoning/planning regulations, NIMBYism, desirability of living in SF, a literal lack of land, and thus, incredibly expensive housing stock.

Lack of affordability isn’t just an issue for would-be first time home buyers. It affects another crucial demographic required for a balanced real estate market: the “move up” home buyer. This is the couple or individual who purchased their “starter” house or condo a few years ago thinking they’d trade up when they built up equity and needed more space.

Everyone wants their home value to go up, right? But when the market doubles in a short time (~7-10 years), there are unexpected consequences beyond the obvious. All of a sudden, the trade up home is out of reach for many even factoring in their increased home equity for a down payment, especially when you add in the higher property taxes (and now, the majorly decreased Federal tax deductions).

With fewer folks trading up, that means fewer listings for the next gen of first time home buyer. Add in the fact that more “empty nesters” are staying put in their big homes and not downsizing, and you have a recipe for continued low inventory.

Check. Sadly, this is all the same now as then. The proposition about seniors taking their tax basis with them anywhere in California failed. That would have opened up the market a bit by encouraging “empty nesters” to downsize. Right now, even if they would rather live in a Palm Springs condo than a Noe Valley Victorian, it may actually be cheaper for them to stay put, largely because of Prop 13 and property taxes.

3. The bull market charges on and I predict 2018 to be another year of the “seller’s market” for most listings and neighborhoods. SF real estate is hyper-local and there has been a slowdown in downtown condo sales where there is relatively more competing inventory but even so, the attractive listings sell for incredible prices.

2018 is going to be a great year for home sellers who are realistic about their pricing and for home buyers with an iron gut (and the right real estate agent) to be competitive and think “big picture” when it comes to writing offers. As I like to say, “You need to win to move in.” This does not mean over-paying, but it does mean making your offer the one the seller accepts.

Check. Of our 31 listings last year, only one required a price reduction to sell. And it still received multiple offers. Buyers were out in full force in 2018. The autumn was a bit funky and list price mattered more than ever but overall, in the prime neighborhoods, buyer demand held.

I was three for three! Not bad, eh?

Ready for it? Here are my predictions for San Francisco real estate in 2019:


This year, I’ve decided to do something a little different. Instead of (solely) my pontifications, how about we ask other local experts for their insight?

Topic 1: Mortgage & Loan Trends, and Interest Rates!

We asked two of the most experienced SF loan officers how they feel about the economy, home loans and interest rates in 2019. Here’s what they say:

From the desk of Lilly Chiang, PNC Bank:

“First quarter 2019, we have seen a rate decrease bought on by the stock market and the Fed casting shadows of doubt on the US economy. All this is helping mortgage rates which fare better in riskier economic times. This is the classic flight to safety in the bond market, as more money into the safer markets, the better the rates. This could be a great chance for buyers now to get into the market.

“I see rates decrease by 0.25% across the board from 3rd and 4th quarter 2018 today. There may be a refi opportunity today if you purchased around mid 2018.

“But this rate dip may be fleeting…if the stellar economic reports appear in the coming weeks, rates could rise as optimism in the economy takes over.

“But, the Fed calling for slower rate hikes in 2019 may signify that the Fed is not as confident in the future as it was in 2018. If you read the reports in 2018, everyone was expecting rates to be over 5% in 2019 based on the mortgage rate trend increasing in 2018 (NAR, National Associations of Home Builders, Realtor.com).

“Also, in SF, we have Uber and AirBnb announcing IPOs mid June 2019. You may see the real estate market heat up again with the unleashing of new money into the market. So, NOW may be the best time to buy.”

According to Mickey Cogliandro, Senior Home Lending Officer, at Citibank, the 2019 economic forecast looks great. While many are predicting a recession, Citibank’s head of investment strategy sees it differently.

A simple analysis of past yield curve inversions suggests that a recession and equity market peak likely remain a ways off. On average, the S&P 500 returned an additional 19.7% after yield curve inversion. This tended to occur about 10 months after the yield curve inversion and about six months before the ensuing recession. With the yield curve still in positive territory, we still think that the equity market has further room to run.”

Simply put, based on analysis of past trends, the recession is not going to happen in 2019. Rates are at an all-time low for the last 12 months and we see the 10 year ARM dropping even further in the month to come. This is a great time to purchase or refinance even with cash out right now.

Rates are expected to eventually go up over the next year by up to 1%, but the Bay Area is relatively unaffected by this increase as average median income for San Francisco exceeds national averages. While payments may be higher with higher rates, most incomes in San Francisco are able to still qualify for loans. With rates at all time low and property values still on the rise, now is an opportune time to enter the market.

Topic 2: Home Staging and Design Trends

Will the tyranny of grey continue? Will buyers want more or less variety when they go home shopping? What are the designers thinking? Let’s find out!

From the impeccable desk of Kaidan Erwin, home staging professional:

“Staging will continue its evolution from cookie-cutter towards looking more layered, nuanced, and sophisticated. The best staging will look less “staged” and more like a gorgeous, private home. Part of that will be because as staging itself gains more cred and respect as a career choice, better designers will enter the staging business which has historically been looked at as somewhat of an “ugly stepsister” to the tonier interior design world.

And…color! People are going to move further and further away from energy-less neutrals and start using some brave, more fashion-forward colors. Literally the colors that are showing up on the catwalk will show up in some cities in staged real estate. Bright navy blues, kelly greens, magenta, and pink will continue their ascendance onto the home staging palette.”

From the designer digs of Alyssa Brandfass, Mint Staging.

“I see grey fading to the background in 2019, stepping back but not leaving the home staging scene completely, as neutrals play a vital role in presenting a home to a wide range of buyers. But with grey acting more as the accent instead of the base, more room for bold colors and natural elements is available to take center stage. I think the whitewashed look and organic tones for the walls will takeover, allowing the deep rich colors and natural elements to pop — warming the home and creating a sanctuary-feel for homeowners.

Design predictions for 2019 include a greater interest in getting adventurous with color and in playing with the symbiotic connection between nature and humankind with the use of organic materials, heavy greenery, light wood floors and stones. Deep rich tones, moody hunter greens, and dark teals, that create a bit of drama and depth, pair well with the natural elements being used for design styling.

Living Coral, Pantone’s colors of the year for 2019, nods to the prediction of the playful use of color making a comeback this year. Feminine colors like coral, as well as blush, dusty pink and bronze work well with bringing some warmth to the grey and neutral tones we are used to seeing in staging.

In a city known for its vibrant and colorful exterior of homes, I think the use of bold colors coming back to our interiors will be embraced with open arms.”


Um, I dunno.

Frankly, after 16+ years and quite a few market rodeos, I’ve learned that I am not an economist (surprise!) and that most of the economic predictions are best the morning-after, i.e. who knows?

Early Trump days were supposedly good for the economy but that depends on who you are and where you live. The tax bill wasn’t great for coastal Californians and other residents in high-tax, high property value states. The stock market was on a tear and is now on a roller coaster ride. That inverted yield is a for sure sign of a recession but it was so slight…is it really? Will the shutdown go on indefinitely? Will this slow down the local IPOs set to happen here in the SF Bay Area?

Seems like there are more questions than answers (another surprise!), but again, I’m not a trained economist nor a psychic (though my intuition does lead my way). SF is not an island, but it is a peninsula so I guess that makes us different but not completely.

My best advice is to follow your hyper-local market and plan strategically for your real estate future. I’d say the best time to buy or sell is right now but that’s what we all say, isn’t it? 😉 The best time to buy a house will always be…10 years ago. And the second best time, well, yes, that’s today.

In conclusion, there are many reasons to believe that the San Francisco real estate market will continue to thrive but then again, we are in “extra innings” as compared to the length of our typical seller’s market…so it is time for a shift. And the greater economy both in the Bay Area, California, the US and worldwide has some major issues to work out. Most likely, we’ll see a plateau of home values plus or minus with exceptions being for the most desirable and limited properties. Multiple offers will continue for those “hot” listings, and there may be more opportunity for buyers as well. What I know for sure is that you should buy or sell a home when it’s the right time for you…and that our small team is dedicated to helping you in the best way possible.


2018 was an exciting time for me as my family grew and my responsibilities as a working mother continue to unfold. I know working mamas hear me when I say that working full time as a top 10 San Francisco real estate agent and mothering twins is not for the faint of heart for those who require lots of extra sleep! But it is deeply rewarding and an amazing privilege to have a successful career and beautiful family to share it with.

Wishing you and yours all the best for 2019,



In 2018, Danielle Lazier + Associates sold over $104,000,000 in SF Bay Area residential real estate selling more homes than any other SF Realtor (per MLS). We specialize in listing marketing and home buyer representation. We work with a diverse clientele in terms of budget, property type and location, but one thing remains consistent: our clients have a clear goal to maximize their San Francisco real estate investment and want us to help them because we deliver both results and an enjoyable experience.

Are you buying or selling a home in San Francisco? Reach out to us for a consultation!

Bookmark (0)