San Francisco’s share of homeowners selling their properties at a loss is the highest of any major metro in the country and continues to rise.
Data from residential real estate company Redfin showed that 13.57% of San Francisco metro home sellers sold their properties at a loss—nearly double the 6.92% figure in Detroit, the city in second place.
Among those who lost money selling their homes in San Francisco, the average loss was $122,500.
The data from Redfin analyzed the top 50 metro areas in the United States based on population. To be included in the dataset, a home must have been owned by the same party for at least nine months leading up to the sale.
San Francisco’s rate—more than four times the national average of 3.22%—means that more than one in eight homeowners in the city are selling at a loss.
The trend line is rising. During the same period last year, San Francisco was also the top city on the list, but only 9.15% of homes were selling at a loss.
According to an analysis by Redfin, the total value of homes in San Francisco has fallen by around $60 billion since last summer.
San Francisco has experienced outsize declines in home prices as higher interest rates have hit home values nationwide. This is due in part to its status as one of the most expensive home markets in the country, as well as the impact of remote work and layoffs in the tech sector.
Patrick Carlisle, a Bay Area market analyst for residential real estate company Compass, said the region experienced a much sharper appreciation in home prices compared with the rest of the country coming out of the Great Recession.
“The high-tech boom was most powerful here. We saw 700,000 new jobs and an IPO mania, where many people gained vast amounts of wealth during a relatively short period,” Carlisle said. “That, plus very low home construction rates, pushed up prices.”
The pandemic hit the Bay Area real estate market harder than the rest of the country, and while prices have rebounded from the nadir seen in 2022, they have not yet recovered to peak pre-pandemic pricing. That’s in contrast to much of the country, Carlisle said.
Additionally, the “mortgage lock-in” where current homeowners are disincentivized from selling and purchasing a new home because of concerns about higher interest rates means that only a limited number of properties are coming onto the market.
The majority of homes for sale in San Francisco—roughly 70%—are condos and condo-like properties, Carlisle said. It’s these property types that have been hit the hardest, particularly in Downtown neighborhoods.
That being said, most home sellers in the city are still making out ahead. The median gain for profitable home sellers in San Francisco was $615,000, which is second in the country behind San Jose’s $733,500 figure.