Resale Reboot and Price Reduction

It seems that 11 Franklin #802 is getting a lesson in economic supply/demand fundamentals… the hard way. Appearing last year for its inaugural resale after being purchased brand new in 2016, the top floor 2-bed/2-bath/979sqft condominium is now making a third attempt at finding a buyer, albeit at a time when numerous new construction developments in the area are competing to lure ownership-oriented individuals and condos have decidedly fallen out of favor. And for those reasons, we’re calling this one an opportunity to buy the dip.

Our MLS sleuthing reveals that this home at One Franklin went live on the market back in September 2020 listed at $1,450,000 after having been peddled as a ‘coming soon’ listing for tuned-in real estate agents at $1,390,000.

Why the price increase? Good question. The answer surely lies in conversations had by the listing agent and owner, but in Q3 2020 you may recall catching a glimmer of light at the end of the COVID tunnel (before the pandemic’s second wave). Real estate agents are habitual optimists, and sellers tend to value their home more than the market will bear. On top of that, consider the trend that emerged in 2020 to price real estate listings closer to what the true value is instead of aiming to ignite a bidding war. Oh, how times have changed.

As the holiday season arrived, the listing departed without sale. And then, with the start of San Francisco’s traditionally strong springtime real estate market, it was back and seeking $1,290,000. It seems the forces of deja vu are strong with this one, because just six weeks later the listing was again cancelled without sale.

Now, here 11 Franklin #802 is again this week. The condo has taken another price reduction down to $1,275,000 – a price at which the seller will likely be taking a loss by the time broker commissions are paid. Will the place catch a buyer this time around, or will the race to the bottom continue? 

11 Franklin Street #802 is listed and marketed by cooperating broker The Canlas Brothers. Listing photos below courtesy of SFAR MLS.

At the brand new Elevant condominium development located nearby at 555 Golden Gate Avenue, a handful of 2-bedroom residences are listed on the MLS at sub-$1 million prices. Buyers there are being wooed with incentives including up to $17,500 in lender grants and down payment as low as 5 percent.  A hop-skip-jump to Serif at 960 Market Street will get buyers those same incentives, plus $7,500 in seller credits with purchase of first release 2-bedroom residences priced from the low-$1 millions.

And the glut of like-kind condominiums is only growing. The Oak at 55 Oak Street (only one half block from One Franklin), is slated to begin selling its brand new residences in the next month or two.

We’re hoping for the best with 11 Franklin #802, but we’ll point out also that the units struggling for first-time resale at Stage 1075 (which we wrote about last month) are all still available, including a 2-bedroom listed at $949,000.

Exclusive buyer representation and COVID-compliant private tours available > 415.715.9205 / onefranklin@vulcca.com