As 2025 draws to a close, the real estate market has experienced yet another interesting year. The recurring question at this time is: Where is the market headed next?

What decides a home’s value? Why do two nearly identical homes in two close-by towns have a $300,000 difference in their selling prices? Why did the house across the street linger on the market with price reductions while the one on the next block sold in three days over the asking price?

Addressing complex problems often results in unintended consequences. Legislators frequently confront such outcomes when enacting comprehensive laws and ordinances.

With a lifelong background in real estate, I have a particular interest in the evolving dynamics of the 2025 market, especially as we navigate through this transitional period. Traditionally, my September commentary focuses on projections for the fall real estate market, which ushers in San Francisco’s second peak selling season.

As the first half of 2025 concludes, we have faced several unique challenges including the impact of President Donald Trump’s policies – tariffs, inflation rumors, civil unrest and international warfare. In this column, we assess the current state of the local real estate market.

Lately I have read several articles regarding the financials of buying versus renting a home.

The stock market goes down substantially when Trump increases or threatens to increase tariffs. It goes up when he decides to pause the tariff. When other countries threaten to raise tariffs against us, our stock market goes down. The stock market is a leading economic indicator and gives us an idea where the economy is heading.

The Upper Great Highway is closed, but the saga surrounding it continues. This discussion will refrain from debating the issue, as there are other platforms available for such discourse. I want to focus on how closing the Upper Great Highway affects property values in the Richmond and Sunset districts.

Now that 2025 has arrived, buyers and sellers are preparing for the upcoming spring real estate market. However, unlike previous years, with the stock market going up and down the first two months of the year, there is a sense of uncertainty and anxiety.

Being a rental property owner in San Francisco has become increasingly challenging each year.

Looking back, as 2024 comes to an end, we have had another interesting year in the real estate market. The question being asked at the end of the year is always: “Where is the real estate market headed?”