San Francisco, once the crown jewel of the West Coast, is now on the brink of collapse, and no one seems to be ringing the alarm.
The city’s housing market has been particularly hard hit over the past year, with prices plummeting and homeowners fleeing in droves.
JPMorgan Chase CEO Jamie Dimon didn’t mince words when comparing San Francisco’s plight to that of New York City, calling the Bay Area “much worse.”
“I think every city, like every country, needs to think about what makes an attractive city,” Dimon told Maria Bartiromo in an interview on Fox Business. “It’s parks, it’s art, but it’s definitely safety, it’s jobs and job creation, it’s the ability to have affordable housing. Cities that don’t do good jobs are going to lose population. ”
San Francisco is failing on every front, and its housing market is quietly collapsing as a result.
Properties that were once luxury properties are now being listed and sold at deep discounts just to attract buyers.
Consider the penthouse at the San Francisco Four Seasons Residential. It was originally listed for $9.9 million in November 2020 and is now seeking buyers for $3.75 million, a staggering 62% drop. It remains on the market today.
Homeowners desperate to escape the sinking ship are selling out their properties at a loss, with some losing hundreds of thousands of dollars on their investments in just a few months.
The five-bedroom home at 478-480 Fourth Avenue sold for $1.1 million earlier this month after selling for $1.6 million less than a year ago.
The two-bedroom condo overlooking the ballpark at 88 King St. sold more than a decade ago in 2014 for $1.12 million and again last month for $1.08 million.
Another two-bedroom condo at 1075 Market St. sold for $1.25 million in 2019 and just traded for $675,000 earlier this month, with a price reduction to boot.
Latest information shows broader trends Redfin Analytics, it’s a bleak scene. Nearly one in five homeowners in San Francisco sell their home at a loss.
Another, a rare home with oceanfront views overlooking the Golden Gate Bridge, was first listed in March of last year for the first time in nearly 35 years at a price of $12.8 million. It took him a year to sell it for $7.85 million, a fairly modest price for the area after several price cuts.
The situation in the commercial sector is not much better, with office vacancies rapidly increasing after the pandemic.
And that desperation is evidenced by the recent sale of a Market Street property at an astonishing 90% discount. The building, located at 995 Market Street, was acquired at public auction last week for just $6.5 million. The previous owner paid $62 million in 2018.
Even the retail giants are abandoning ship.
Macy’s announced in February that it would close its massive flagship store in San Francisco’s Union Square. A year earlier, Nordstrom had announced it would close two stores, citing “deteriorating local conditions.” The mall was inundated with fentanyl overdoses, drug dealers, and thieves.
Craig Ackerman, a real estate industry veteran who has watched San Francisco rise and fall for more than 30 years, laments the city’s potential wasted by incompetent leadership.
He predicts years of misgovernment unless fundamental reforms are made. However, the current government tends to prioritize liberal positions over realistic solutions, and the outlook remains bleak.
“I think San Francisco is probably going to have another five to eight years of mismanagement. I mean, things are a mess here, but they don’t have to be. This could all be changed with the stroke of a pen. ” Ackerman told the Post. “But Mayor, they have chosen to continue this nonsense.”
“I don’t see that changing,” Ackerman added. “They’re happy waving the liberal flag, looking for a fantasy land that doesn’t exist…and they’re going to die on the way there.”
