July 29, 2005
QuickLinks: Friday update (updated)
SocketSite Survey: Damn those “Industry Experts”, we want to hear from YOU.
· SocketSite’s Highly Scientific Real Estate Survey [Zoomerang]
Posted by socketadmin at 10:34 AM
July 28, 2005
Calling All “Industry Experts”
Headlines coming out of the Inman News’ Real Estate Connect conference this afternoon: “Industry leaders predict slowing market”. To which we respond: no kidding, it’s about time, and how about some hard numbers from these so called “Experts”?
So instead of simply nodding our head at the vague predictions of six conference panelists, we decided to go out on a limb and generate some real "guidance". Now please take a couple of seconds to participate in SocketSite's first highly scientific real estate survey (seriously, it’s only four multiple choice questions).
Posted by socketadmin at 4:40 PM
Here We Go Again
Remember last May when we first suggested you take a look at the Spring PMI Risk Index? And then how two months later Kiplinger’s finally gets around to publishing a story about the report and gets all the press? Well, here’s another two-month head start for the SocketSite community...
According to the PMI Group’s Summer Market Risk Index, the chance of a price decline in San Francisco increased 6.4% last quarter (the third largest increase amongst all the major MSAs), and now stands at an overall 45.9% likelihood of decline. That’s not good.
Marco Van Akkeren, an economist with PMI Mortgage Insurance Co., explained, "We are continuing to witness record-pace home price appreciation in many markets without the necessary gains in income, home affordability and rent inflation. This is causing the current home price environment to diverge from long-term economic fundamentals, which cannot be sustained indefinitely."
Across the bay Oakland hit 50.9% to become only one of six US markets with a greater than 50% chance of decline.
· Economic and Real Estate Trends: Summer 2005 – pdf [PMI Group]
Posted by socketadmin at 9:49 AM
July 27, 2005
Mission Armory Redux?
We’d be willing to bet that if you’ve ever passed by the Armory at Mission and 14th you’ve had visions of what you’d do with the empty building. And you wouldn’t be alone.
Despite being listed on the National Register of Historic Places, the Armory has been vacant for over 30 years. And during those years which it’s proven to be a proverbial white elephant for numerous developers/dreamers. A new developer, however, has stepped forward with yet another plan to convert the space into condos and commercial space.
No need to ring your agent (or organize a protest) quite yet. If approved, the project would be completed in 2009/2010.
· A new life for the Mission Armory? [Examiner]
· Cursed Armory Has Hexed Developers for Over Twenty Years [Chronicle]
· Public Corruption Watch [AmicusVeritas]
Posted by socketadmin at 8:55 AM
July 26, 2005
To Sell, Or Not To Sell
The majority of San Franciscans are trying to figure out if (or how) they will ever buy a house in the current market, while a minority find themselves contemplating a sale of their primary residence in order to “cash out” on a bubble. CNN/Money weighs in with four options for those considering a sale of their home:
Option 1: Cash out and sit it out
Option 2: Cash out and invest
Option 3: Cash out and downsize
Option 4: Cash out and stay put
We’re partial to Option 3 and share a bit of advice: trying to “time the market” almost always underperforms a “buy and hold” strategy over the long-term. But be prepared for the long-term to be 10, 15, or 20 years...
· Should you cash out while you can? [CNN/Money]
Posted by socketadmin at 2:37 PM
We present the Sub-Zero Pro 48 as a perfect excuse (or inspiration) to remodel your kitchen. And according to Land+Living, “this refrigerator conforms to the US Department of Energy's stringent standards for residential use - consuming less energy than a 100 watt light bulb.” Now that's cool.
· Sub-Zero PRO 48 Refrigerator/Freezer [Sun-Zero]
Posted by socketadmin at 9:00 AM
July 25, 2005
Sales Activity: National Versus Local
According to the National Association of Realtors, national existing home sales came in at a record setting annual pace of 7.33 million homes as measured in June. And according to the California Association of Realtors, statewide home sales are up 3.6% as compared to June of 2004.
Sales activity in the San Francisco Bay Area, however, fell 11.1% as compared to June of 2004 (up 15.5% from last month). And the median sales price increased to $734,610 (+1.8%), reversing last months downward slide.
Posted by socketadmin at 10:57 AM
Bayview/Bernal Home Depot Update
Home Depot will present its final Environmental Impact Report to the Planning Commission this Thursday, July 28, at 5pm in City Hall Room 400. The public is welcome to attend and comment prior to the Commissions “go”/“no-go” vote.
Bring popcorn, this one should be interesting.
Posted by socketadmin at 9:15 AM
July 22, 2005
Not The “P” But The “E”
You might recall our previous discussion about San Francisco’s housing P/E. In summary, it’s out of whack.
From an investing perspective, while the cost (Price) of an investment in San Francisco real estate has risen, the returns (Earnings) have remained flat. This suggests that the majority of buyers are banking on appreciation (i.e. speculating), which is not a problem as long as the market continues to climb. Either that, or rents have to go through the roof...
Posted by socketadmin at 12:11 PM
QuickLinks: TIC buyers take note
Posted by socketadmin at 12:06 PM
When Robert Kiyosaki speaks, the masses seem to listen. Sparking an investing revolution with “Rich Dad, Poor Dad”, Kiyosaki recently shared his thoughts about the current real estate craze with Carol Lloyd of “Surreal Estate” fame.
"Don't get me wrong, I'm still buying real estate," he told me, adding that he was in the process of buying seven new properties but that he wasn't buying anything in expectation of appreciation. "I'm an investor, not a speculator. ... I want it to cash flow."
He knows that many others have not been so prudent. "I'm worried about people using their houses as ATM machines," he says, referring to those homeowners who have refinanced their homes to buy cars, remodels or simply more real estate. "And I'm worried about all the people who are flipping properties [those who buy properties in order to immediately resell for a profit] -- that's really stupid right now."
Amen. Exactly. And right on.
· Rich House, Poor House [Chronicle]
Posted by socketadmin at 11:10 AM
July 21, 2005
If you read the Examiner, the median sales price of a San Francisco home is now $760,000 (a reported 16.4% gain from 6/04); and if you read the Chronicle, the median sales price is now $800,000 (a reported 15% gain from 6/04). Both papers credit DataQuick as their source. Our take, if you’re trying to buy, read the Examiner, and if you’re trying to sell, read the Chronicle...
We can’t wait to see what the California Association of Realtors reports later this week.
Posted by socketadmin at 8:06 AM
July 20, 2005
Home Depot Almost Home?
Next week Home Depot is headed back in front of the Planning Commission. Having signed a lease for the old Goodman Lumber location at 491 Bayshore Blvd. over five years ago, the Depot is still seeking approval to begin development.
Proponents point to desperately needed neighborhood jobs and a significant increase in local sales tax revenues, while opponents “view Home Depot as a goliath that would hurt local hardware stores, tarnish quality of life and create a traffic nightmare on Bayshore and adjacent Bernal Heights.”
Considering the site used to house Goodman Lumber (which we desperately miss), a Home Depot doesn’t really seem like that much of a stretch to us. And we're damn tired of having to drive down to Colma to ogle the power tools.
· Home Depot nears key point in decade-long quest [Examiner]
An extended history:
· 4/00 - Family Feud Dismantles Goodman Lumber [Chronicle]
· 4/00 - Home Depot Lease [Chronicle]
· 4/02 - Neighborhoods divided over Home Depot plan [Chronicle]
· 4/02 - Path cleared for Home Depot to build 1st S.F. store [Chronicle]
Posted by socketadmin at 2:27 PM
Blast From The Past
We’ve recently been reminded of a passage from Po Bronson’s The Nudist on the Late Shift:
Though people are willing to make bets, nobody pretends that stock prices are rational. By now it’s perfectly clear that the national fascination is riveted on people who are getting rich quickly and easily – and that it’s hard for the country to see beyond the dollar signs. The Internet is the plot device for the 90’s; it’s the thing people are using to get rich...
Okay, now substitute “real estate” for “stock” and “Internet”, and “00’s” for “90’s”. As we are fond of saying, we’ve been to this movie and we know how it ends.
Posted by socketadmin at 8:54 AM
July 19, 2005
Apparently the owners of the 591-room Fairmont Hotel are considering a condo conversion of 226 rooms in the tower annex into 60 housing units. According to the owners group, "The landmark portion of the hotel won't be touched…[t]hat will continue to operate as a hotel. All the ballrooms, all the public spaces will be exactly as they are…We think there's a need for additional housing."
Not too surprisingly Board of Supervisors President Aaron Peskin is up in arms, “Turning the Fairmont into luxury condos would be like turning the Eiffel Tower into an office building…[I]t's not the Fairmont Condo Tower. It's the Fairmont Hotel." This afternoon Peskin plans to “propose an ordinance…that would prohibit tourist hotels with more than 50 rooms from converting lodging space into condominiums or other housing units.” A bit reactionary and short-sighted if you ask us.
Posted by socketadmin at 12:03 PM
Green Clean: The Book
Now that you own/rent it, keep it clean. Finally, a “Green” cleaning book that doesn’t look like something mimeographed in the basement by a couple of hippies (not that we've got anything against hippies). From Amazon:
GREEN CLEAN is the definitive, step-by-step guide to cleaning better while using natural, safe products.
Room by room and stain by stain, GREEN CLEAN offers non-carcinogenic strategies for cleaning deeply and more efficiently.
Spot illustrations enliven each chapter, showing time-saving techniques, products, and equipment.
Also included are recipes for safe, simple, and economic cleaning solutions and the lowdown on the best eco-friendly cleaning products on the market today.
· GREEN CLEAN – Product Link [Amazon]
Posted by socketadmin at 9:00 AM
July 18, 2005
199 New Montgomery: Update
It’s been six days since we last reported on 199 New Montgomery unit #1501 and once again the price has been “Reduced!!”. Somehow that original 1.2% reduction failed to generate a ton of interest, so this time it’s down another 2.2% (asking $879k). Death by a thousand paper cuts...
Posted by socketadmin at 5:36 PM
It’s About Time
Two months ago SocketSite highlighted the PMI Group’s Economic and Real Estate Trends report that indicated a 39.5% likelihood of decline in the San Francisco real estate market over the next two years (and a ten-year price appreciation of 2.3%).
Two months later Kiplinger's generates a ton of buzz with its “The 13 Riskiest Housing Markets” article (based on the very same PMI report). Granted, we didn’t coin any of those cute monikers like “Beantown Bubble”, “Big Apple Bailout”, or “Lauderdale Lunacy”, but we did manage to get our readers the information two months earlier...
· The 13 Riskiest Housing Markets [Kiplinger's]
Posted by socketadmin at 11:24 AM
July 14, 2005
Win A Pre-Fab Studio
· FLOR Sweepstakes Online Entry [FLOR]
Posted by socketadmin at 3:00 PM
525 Gough: No Sell Out
Although showing a list date of 7/06/05, 525 Gough #405 has been on the market for at least four months (all the while at a list price of $1,025,000). This unit is quite possibly the only one not to be sold by the developer (out of 21). And as far as we can tell, no other units have hit the market for re-sale by flippers (but we’ll be keeping an eye out).
· Listing: 525 Gough #405 [SF MLS]
Posted by socketadmin at 12:01 AM