In California overall, prices dropped year-over-year, as sales collapsed, supply more than doubled. No dear, this isn’t just a seasonal dip.

By Wolf Richter for WOLF STREET.

San Francisco and Silicon Valley are now in the solid leadership role of the housing bust playing out in California with sales collapsing and prices heading south from the peak in April at an astonishing pace.

Just about everything that could come together came together. After a two-year outflux of workers due to working from anywhere, there came the collapse of the startup and crypto scenes, starting in 2021 and continuing unabated, leading to the early entries into my pantheon of Imploded Stocks. In early 2022 came the spike in mortgage rates. In mid-2022 came the downturn in employment at Big Tech. By that time, the Fed had been hiking its policy rates relentlessly, and Quantitative Tightening had kicked off. This was punctuated over the past two months by the chaotic dismantling of the workforce at Twitter and its ecosystem.

Local budgets have fallen into deep deficits – although most are still flush with cash from the pandemic funds received from the federal government and the state.

Vacant office space that is on the market for lease and sublease continues to balloon, while landlords have started to file for huge reductions in assessment values ​​to lower their property taxes, which is going to cut revenues further.

This comes garnished by stories in the New York Times that Twitter stopped paying rent on its leased office spaces, and that it was instructed not to pay vendors. At least one of those unpaid vendors – a Silicon Valley company whose software Twitter had licensed – filed a lawsuit last week in the San Francisco Superior Court for nonpayment. It stated, “shortly after Musk’s purchase of Twitter closed, Twitter refused to pay the outstanding quarterly invoice, which was due on November 30, 2022, and Twitter disclaimed any obligation to pay any future invoices…”

These are all signs that the housing market is going to get a lot messier. Prices have plunged the most in San Francisco, followed by the Silicon Valley counties of San Mateo and Santa Clara.

In San Francisco.

The median price of single-family houses sold in November in San Francisco plunged by 11.4% from October to $1.50 million, and by 27% from the peak in April, according to the California Association of Realtors. A nasty-looking chart:

Condo prices plunged by 4.3% from the prior month to $1.15 million, and by 9.5% year-over-year. Since the peak in April, the median condo price is down by 15.5%. Condo sales in November have collapsed by 49%.

Seasonally, the lowest months are December and January. So that’s still to come.

But who is going to buy in the spring selling season? Prices normally rise as demand picks up in the spring; but who will be the exuberant tech workers that will want to overpay for a house by borrowing against the collapsed value of their stock options? Those lucky ones that still have jobs and stock options?

The housing markets in San Francisco and Silicon Valley are tied to the boom-and-bust cycles of the startup scene – now combined with the crypto scene and cryptos – and they’re tied to the stocks of startups and big tech and social media companies in the area, to the jobs that have to be done locally, and to the value of the stock options. All of them are puking.

Year-over-year, the median price of single-family houses in San Francisco plunged by 21%, the sixth month in a row of year-over-year declines. It was the biggest year-over-year plunge since the peak of Housing Bust 1:

Silicon Valley, San Mateo County.

The median price of single-family houses in San Mateo County, which forms the northern part of Silicon Valley, plunged by 6.2% from October to $1.78 million, and by 26% from the peak in April.

Year-over-year, the median house price plunged by 20%.

Silicon Valley, Santa Clara County.

Santa Clara County, which forms the southern part of Silicon Valley and includes the Bay Area’s largest city, San Jose, is lagging behind but is moving right along. The median price of single-family houses dropped by 1.5% in November from October to $1.60 million, and by 19% from the peak in April:

Year-over-year, the median house price dropped by 5.5%, the first significant year-over-year decline in this cycle. Prices had already undergone significant year-over-year declines in 2018 and 2019, and were on a downward path until the trillions in money-printing, the surge in the stock market, and the interest rate repression began to boost prices again.

Currently, Santa Clara County lags San Francisco and San Mateo by a few months, it seems.

In all of California.

Sales of single-family houses in California collapsed by 47.7% in November, compared to a year ago, the biggest decline since 1980, according to the California Association of Realtors. Condo sales collapsed by 46%.

Unsold inventory more than doubled year-over-year to a supply of 3.3 months, and days on the market also more than doubled – before sellers pulled the unsold homes off the market again.

For all of California, the median price of single-family houses plunged another 3.0% in November from October, which pushed the price down year-over-year (-0.6%). The median condo price fell 2.1% in November from October, which whittled down the year-over-year gain to just 2.7%.

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San Francisco has 27.1 million square feet of office space available across the city, a record high, according to new data recently released by commercial real estate firm CBRE. If you need a visualization of that staggering number, that’s just over 20 Salesforce Tower’s worth of office space available — and SF’s tallest building has 1.35 million square feet of office space across its 59 floors.

If leasing activity keeps pace with its current trajectory, upcoming quarters could continue to get worse, given that 50% of current sublease space is set to expire in 2025. “The vacancy rate is going to continue to creep up over the next couple of quarters because demand remains subdued right now and that all relates to the uncertainty around the economy and the amount of space companies need,” said Colin Yasukochi, CBRE’s Executive Director of Tech Insights.

Mayor London Breed spoke about her concerns with the city’s high office vacancy rate last week in an interview with Bloomberg News. The remote work policies of tech companies are part of the problem, Breed said. She pointed to Salesforce as an example. “[Marc is] very supportive of the city, continues to contribute that support to schools and to other great causes, but the building is empty, and that’s a real problem,” Breed said.

Empty buildings depress property values, which affects the amount the city makes in property tax revenue. Workers are also using public transportation at lower rates, and are spending less on goods at local businesses since they spend more time inside their homes.

Breed plans to coax businesses in growing industries, such as biotechnology and green technology, to fill empty office space.

Meanwhile, asking rents on directly leased space haven’t budgeted much. Rental prices are down just 2.6% compared to the first quarter of the year, though it’s down 13% from an all-time high in 2019. Yasukochi said he thinks that’s the most interesting takeaway from the new data. “It’s somewhat of an anomaly because normally high supply and low demand usually means prices are coming down, and we haven’t really seen that much of that,” he said.

When broken down by neighborhood, the highest vacancy rate according to CBRE is the Yerba Buena district at 46.1%. (CBRE defines Yerba Buena as bounded by Market to the north, Bryant to the south, Third Street to the east and Sixth Street to the west). The neighborhood with the lowest vacancy rate was Mission Bay/China Basin at 18.1%.

Interestingly, Yerba Buena has the highest average asking rent of all the commercial districts, but at $82.45 per square foot, it’s only cents above Mission Bay/China Basin’s average asking rent of $82.28.

The rental market is often bolstered by big office deals from tech companies, but San Francisco saw no new deals over 100,000 square feet in the third quarter of the year. Furthermore, the big tenants that do occupy space that large have decreased to five, down from nine in the second quarter of the year. Planet Labs, an Earth imaging company, completed the largest lease renewal of last quarter, while software company Asana signed the biggest sublease.

“From what our economists are seeing, the [market] turnaround will probably be during the middle of next year, but keeping in mind that real estate tends to lag the overall economy a bit,” Yasukochi said. “So it’s probably not until the latter half of 2023 and into 2024 that we’ll really start to see sustained improvement in the market.”

SFGATE reporter Alec Regimbal contributed to this report.

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The San Francisco 49ers are set to make another run at the NFC Championship game. Their team remains primarily the same minus a few subtractions, with Raheem Mostert, Lanken Tomlinson , and Arden Key signing elsewhere. They added Charvarius Ward from the Chiefs to bolster the secondary.

The 49ers went 10-7 during the 2021 campaign. They started 2-4 and went on to go 7-3 to finish down the stretch to make the playoffs. The team has made it known that they are open to trading quarterback Jimmy Garoppolo, but he remains on the roster. The plan was for Trey Lance to take over, but he may not be ready, which makes for an interesting off-season battle once again.

Week 1: At Chicago Bears (Win) (1-0)
Week 2: Seattle Seahawks (Win) (2-0)
Week 3: At Denver Broncos (Loss) (2-1)
Week 4: Los Angeles Rams (Win) (3-1)
Week 5: At Carolina Panthers (Win) (4-1)
Week 6: At Atlanta Falcons (Win) (5-1)
Week 7: Kansas City Chiefs (Loss) (5-2)
Week 8: At Los Angeles Rams (Loss) (5-3)
Week 9: Bye
Week 10: Los Angeles Chargers (Loss) (5-4)
Week 11: At Arizona Cardinals (Win) (6-4)
Week 12: New Orleans Saints (Win) (7-4)
Week 13: Miami Dolphins (Win) (8-4)
Week 14: Tampa Bay Buccaneers (loss) (8-5)
Week 15: At Seattle Seahawks (Win) (9-5)
Week 16: Washington Commanders (Win) (10-5)
Week 17: at Las Vegas Raiders (Loss) (10-6)
Week 18: Arizona Cardinals (Win) (11-6)

The 49ers have a tough schedule ahead of them, including a trip to Mexico City to square off against the Cardinals. They will have the benefit of having their biggest non-divisional games at home. The 49ers won four games at home last season, but with a healthy roster, they should be much more improved.

Win total odds: Under 10 (-130) Over 10 (+110)

Pick: Over 10

The biggest question will remain the quarterback position until Lance proves himself as the starter. Garoppolo could still win the job if Lance isn’t ready. The defense will lead the way for the 49ers once again and a dominant run game to help lessen the load on the quarterback. Star wide receiver Deebo Samuel requested a trade in the offseason, but it seems as if he will be back with the team. The disgruntled star expressed how he wasn’t happy with being used in the super back role, and if that role is taken away, it could make the difference in a win of two.

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the San Francisco 49ers made it to the NFC Championship Game this last season as 1 of 3 teams in the NFC West to make the postseason. They eye another trip to the playoffs with second-year QB Trey Lance expected to lead the way as their starting quarterback in 2022.

Below, we look at the San Francisco 49ers 2022 NFL futures odds – including win total, division, conference and Super Bowl odds at Tipico Sportsbook – with best bet suggestions among our NFL picks and predictions.

The 49ers saw several starters depart in free agency this offseason — RB Raheem MostertOL Sheet TomlinsonDT DJ Jones and CB K’Waun Williams.

They added CB Charvarius Ward and S George Odum as their most notable signings in free agency and then DE Drake Jackson in the NFL draft.

San Francisco 49ers’ 2022 schedule

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San Francisco 49ers’ 2022 win total: Best bet

Odds provided by Tipico Sportsbook; access USA TODAY Sports Scores and Sports Betting Odds hub for a full list. Lines last updated Tuesday, May 17 at 8:35 am ET.

Over/Under: 9.5 (O: -150 | U: +125)

The 49ers won 10 games last season. They lost several starters and are moving on from QB Jimmy Garoppolo as they appear poised to turn to second-year QB Trey Lance to run the offense.

Coach Kyle Shanahan is 39-42 leading the 49ers. Garoppolo is 31-14 as a starter for the 49ers, which means Shanahan is 8-28 when he has someone other than Garoppolo starting.

Is Lance already ready to lead a playoff-contending team? That is the question.

I would not put money on the Over. I consider passing on this but I LEAN UNDER 9.5 WINS (+125).

San Francisco 49ers’ 2022 Super Bowl odds

Odds: +1500 (bet $100 to win $1,500)

The 49ers are firmly considered a contender for the Super Bowl following their run to the conference championship. Only 5 teams have shorter odds. The favorites to win the Super Bowl this next season are the Buffalo Bills (+600) and Tampa Bay Buccaneers (+700).

The Houston Texans have the longest odds at +20000.

At +1500, San Francisco has an implied probability of winning the Super Bowl of 6.25% or 15/1 fractional odds.

Conventional wisdom says that makes them worth at least a small wager to win it all. However, citing the 8-28 record the 49ers have since Shanahan became head coach when anyone other than Garoppolo starts, that isn’t a wager you can confidently make with Lance as the starter. This is not like Patrick Mahomes coming in as the starter for the Chiefs in his second season. He was a much more accomplished player than Lance was coming out of college.

PASSPORT.

San Francisco 49ers’ 2022 playoff odds

Will 49ers make the playoffs: Yes -220 | No +175

San Francisco was one of the 3 wild card teams last season and did make it to the NFC Championship Game before losing to the eventual Super Bowl champion Los Angeles Rams.

The odds suggest overwhelming optimism they will return to the postseason. The price makes it such that it isn’t worth it to bet on them making it.

However, the price for the 49ers not making the playoffs is tempting.

You look at the losses they had in free agency and their history without Garoppolo as their start and you wonder why the odds are what they are. The teams expected to win their respective divisions are the Rams, Bucs, Packers and Cowboys. After them, the wild-card race really is wide open.

Unless Lance is much better than he was a season ago, you have to really look hard at them missing the playoffs. I LEAN 49ERS DO NOT MAKE THE PLAYOFFS (+175).

Odds to win NFC West Division

• Los Angeles Rams +135 (bet $100 to win $135)
• San Francisco 49ers +175 (bet $100 to win $175)
• Arizona Cardinals +320 (best $100 to win $320)
• Seattle Seahawks +1300 (bet $100 to win $1,300)

The 49ers are viewed as legitimate contenders for the NFC West title. The champion Rams with Matthew Stafford at quarterback and 3 stars leading the defense in Aaron Donald, Jalen Ramsey and Bobby Wagner are +135, while the 49ers are +175 with an unproven and largely untested young quarterback.

I’m not optimistic. PASSPORT.

Odds to win NFC

odds: +650 (bet $100 to win $650)

Again, there are high hopes for the 49ers as only the Buccaneers, Rams and Packers have shorter odds. Their quarterbacks are Tom Brady, Stafford and Aaron Rodgers.

Do we really think that Lance will lead the 49ers over those teams and quarterbacks?

PASSPORT.

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