She just wanted to see it one more time.
This was Anuja Patel’s second time taking a look at the quaint, two-bedroom, one-bath condominium located at 2584 Folsom St. in the Mission District.“I like it,” said the 36-year-old engineer, originally from Queens, N.Y., who has lived in the Mission for the last five years and found the spaciousness of the condo appealing.
After two years of shopping around, Patel feels that now is the time to buy. “I’ve been looking so long,” she said.
But it’s easy to see why it’s tempting to wait. The condo she’s considering buying has been on the market for three months and the price has been cut twice, from $610,000 to $590,000. It’s currently on the market at $559,000. In total, that’s an 8 percent drop.
This is typical of the current market for condos in the Mission District. Buyers like Patel are taking the plunge and sales have increased lately, indicating the worst may be over. But real estate prices are expected to remain constrained amid a still tepid economy and a recent increase in foreclosures, brokers said.
“There’s pressure on price and pressure on sellers despite the increase in sales volume,” said Jason Chapin, a real estate consultant with McGuire Urban Bay.
Four condos have been foreclosed in the Mission since April, according to research firm DataQuick, with nine others defaulting on their mortgage notices since July.
The default notice is the first step in the foreclosure process and has increased sharply from earlier this year. While it’s unclear how many home’s will actually be foreclosed on, frequent defaults are a signal that the local market has yet to recover completely.
“Things are limping along,” said Mark Dawson, a real estate agent at GM Green Real Estate.
The average price of a condo decreased in the first nine months of this year compared to the same period last year, according to Zephyr Real Estate. The number of condos sold decreased as well, and the average time on the market for Mission condos increased by almost a third to nearly three months.
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But there have been signs of stabilization since July, giving agents hope that the worst is over.
Overall, 36 condos were sold in the Mission in the third quarter, up from 18 in the first six months of the year. Another 18 condos are currently in contract, leaving 13 properties on the market, according to Zephyr. Median resale prices during the third quarter also increased by more than 20 percent to approach $750,000.
“July and August are typically slow months,” said Michael Ackerman, an agent with Zephyr Real Estate. “By the second week of July I could [usually] take a breather. It was not the case this time.”
More inventory is also coming in the form of new development.
The 76-unit Union-SF development on Bryant Street will open for sale “relatively shortly,” said Garrett Chan, regional VP for Pacific Marketing Associates. Prices will range from $400,000 for a junior one bedroom to $700,000 for a two bedroom unit. Chan expects Union-SF to sell out quickly because foot traffic has been high.
Just a few blocks down, on Alabama Street, the $74 million Mosaica601 opened 10 months ago and all 34 of its condos are either sold or in contract, according to project manager Desiree Espinoza. Its 13 market-rate condos sold in the $600,000 price range, and its 21 below-market-rate condos sold between $175,000 and $350,000.
The prices for both developments are in line with the current market, which is key to closing a deal during a still uncertain environment, brokers said.
Patel, two years into her search for a condo, acknowledged a “reality check” among sellers this year. That, and the $8,000 federal tax credit which is currently slated to expire on Nov. 30, has brought her closer than ever to buying a place.
“I need to get in right now,” she said.