October 31, 2005
QuickLinks: Six As The Magic Number
Posted by socketadmin at 5:30 PM
October 29, 2005
Sign(s) Of The Times
Tipped by a loyal reader of SocketSite, we dispatched our staff photographer to 308 Presidio post-haste. No fewer than seven "For Sale" signs (there’s another behind the car) that all seem to be screaming “please buy me before the market turns” in unison.
Not too surprising that the units are being offered as TICs, but it is interesting to note that the units are being advertised as the “First individual financing offered for TIC's in Pacific Heights!” Six units in the building but only four units currently on the market and ranging from $699k to $825k (yes, priced more like condos than traditional TICs).
Posted by socketadmin at 11:30 AM
October 27, 2005
Forget $340M Powerball, Just Give Us A Damn Condo!
4,300 applicants, 400 drawn names, and only 20 lucky “winners”. Residents in other cities dream of winning multi-million dollar lotteries, while here in San Francisco we dream about winning the right to purchase a 600 square foot condo in the Beacon for a measly $172k.
The fine print: “applicants may not have owned a home in the past three years, must have limited assets and must earn no more than 70-110 percent of the area's median income ($66,500 if you’re single, $95,500 for a family of four)...[and] the amount of equity they can accumulate is capped [around 3% a year].”
We would, of course, love to hear from any lucky winners. And as always, please feel free to invite us to the housewarming (we’ll bring champagne).
∙ Lottery attracts a host of would-be S.F. homeowners [Chronicle]
Posted by socketadmin at 9:45 AM
October 26, 2005
Median San Francisco Bay Area Home Prices Down $20k
According to the California Association of Realtors, the Median sales price of a San Francisco Bay Area home fell 2.8% last month (from $730k in August, to $710k in September). In addition, sales volume was down nearly 10% from the previous month and down over 8% year-over-year (yes, accounting for that dreaded seasonality).
Funny how some local industry sites choose to focus on either the more rosy year-over-year numbers (or worse, irrelevant national sales statistics). If you live in the Bay Area, the local statistics are what you should be watching (and mining for trends). As they say, past performance is no guarantee of future returns...
Posted by socketadmin at 12:17 PM
Potential Home (Depot) Wreckers
The Board of Supervisors is considering an appeal of the Planning Commissions approval for Home Depot's Bayview project.
Specifically, the supervisors were charged with looking at whether the project's environmental impact report -- accepted by the Planning Commission -- was accurate, objective and complete.
Paul Maltzer, the Planning Department's environmental review officer, said he is satisfied that the project is environmentally sound and shows no "significant'' problems in such areas as traffic, parking, air pollution and increased demands on city services that should stop it from going forward.
"We've studied this to death, frankly,'' Maltzer told the supervisors.
Despite Maltzer’s expert opinion, Supervisor Ammiano (who represents neighboring Bernal Heights) was quoted as saying, "I see big holes here." We’re not even going there (other than to point out that his quote is not nearly as catchy as “I see dead people”).
Posted by socketadmin at 12:10 AM
October 25, 2005
Sweet Lime Green Victorians (Literally)
Okay, we know we’re pushing the boundaries a bit with regard to “real estate” news, but it’s worth it to report that artist Elizabeth Hickok has created a scale-model of San Francisco. Out of Jell-O.
And as if the pictures weren’t sweet enough (so to speak), she has also created a video of “Jell-O-by-the-Bay” experiencing a simulated earthquake. Watch it wiggle, see it jiggle...
Posted by socketadmin at 12:26 PM
October 24, 2005
POS (And We're Not Talking Point Of Sale)
Marinite’s nano-puiblishing empire has expanded beyond the Marin Real Estate Bubble (which has been going strong since July). The newly added site, Marin PoS is billed as profiling “typical examples of our overpriced, crappy houses here in Marin”. For example:
This lovely 1 bedroom 1 bath 788 sqft pos is surrounded by fragrant marsh mud and the verdant charm of pickle weed. It will only set you back $549,000.
And before you crunch the numbers and decide that $700/sqft is a bargain, take a look at the picture. And read the comment about high tide.
∙ Site: Marin PoS
Posted by socketadmin at 11:01 AM
When Barrack Speaks, You Should Listen
Some choice quotes from Tom Barrack, head of Barrack's Colony Capital (one of the largest private equity firms devoted to real estate and having provided returns of 21 percent annually since 1990):
"I feel totally safe playing polo on a field full of pros," says the bronzed 58-year old. "But when amateurs are all over the field, someone can get killed. They have more guts than brains. They charge after every ball and don't know when to hold back."
It's the same with U.S. real estate right now. "There's too much money chasing too few good deals, with too much debt and too few brains." The amateurs are going to get trampled, he explains, taking seasoned horsemen, who should get off the turf, down with them.
Says Barrack: "That's why I'm getting out."
Right now, Barrack's view of the U.S. market couldn't be clearer: It's a great time to sell, and a terrible time to buy.
∙ The king of real estate's cashing out [CNN/Money]
Posted by socketadmin at 10:27 AM
October 18, 2005
A Million Here, A Million There
Two months ago we reported on Yahoo’s Letter of Intent to lease 200,000 square feet of prime San Francisco real estate. It now appears that they’re looking for “as much as a million square feet of new office space in the Bay Area to accommodate its rapid expansion.” Enough space to accommodate up to 4,000 new employees.
Thanks to PaidContent.org for bringing it to our attention.
Posted by socketadmin at 10:28 AM
Open Meeting: Mid-Market Redevelopment
The Redevelopment Agency Board will review the redevelopment plan for the mid-Market area this afternoon at 4 p.m. The meeting is in Room 416 of City Hall. Pro: 3,000 new housing units and an arts district; con: displaced low-income residents.
Posted by socketadmin at 9:15 AM
October 17, 2005
We’re Moving On Up!
According to a Global Insight study, the San Francisco real estate market is overvalued by approximately 36% (up from 30% at the beginning of the year). As such, San Francisco is considered to be “extremely overvalued”. What’s that mean?
“Study findings indicate that 53 metropolitan areas, representing 31 percent of the total value of the US housing market, "are extremely overvalued" and face a high risk of price correction. To be considered "extremely overvalued," markets had to have current prices exceeding the expected price by 30 percent or more, a threshold that was determined from the median degree of overvaluation that preceded 63 known local price drops over the past 20 years.”
So if you’re planning on making a 10% down payment, imagine losing 300% of your investment. Yes, the dark underbelly of “leverage” that most agents never talk about; you can lose more than you invest. Much more.
∙ Overvalued Housing Market? Depends Where You Live [Global Insight]
Posted by socketadmin at 4:57 PM
October 16, 2005
Bay Area Inventories Up, Agent’s Spirits Down
This should come as no surprise to any regular SocketSite readers, but if you haven’t been reading or are new to our community here’s a bit of insight: inventories are up, transactions and selling prices are down, and Bay Area real estate agents are actually having to sell. Some choice quotes from this mornings Chronicle:
“Amid a perceptible cooling in the housing market and a jump in the number of homes for sale, Bay Area real estate agents find they must do something they haven't done in years: sell.”
"In the last few years, you put something on the market for two weeks, and you didn't have to do anything," said Falconio, an associate manager at Prudential in San Francisco. "Now you have to work for it a little bit more."
“The supply of condos offered through the Multiple Listing Service surged 57 percent between Oct. 1, 2004, and Oct. 1, 2005, while single-family home listings have soared 35 percent.”
“Sales, meanwhile, have slumped 26 percent and 14 percent for single-family homes and condos, respectively, between September 2004 and September 2005"...
“As the nearly decade-long housing boom appears to be losing steam, the balance of power is shifting noticeably toward buyers, according to agents, often among the first to see a turn in the market. Other reports based on federal data or local recorder-assessor filings tend to lag the market by a few months.”
"We need to start marketing properties at listing prices (sellers) are willing to accept," said agent Roger Landry.
"Sellers are sometimes the last to know," said Bodnar. "They think they're still going to get 20 percent or 30 percent over (the asking price), but now they may find that offer dates are coming and going with no offers."
"The market has slowed, but not that much," said Calhoun, owner of Creekside Realty in San Jose. "I don't know anyone who's complaining about homes selling in three weeks."
We just couldn’t help but end on that optimistic note. Although kind of reminds us of that agent’s “Don't be fooled into thinking that this stockpile of inventory is a trend. It is a one-time occurrence. And you can quote me on that” boast that we’re busting...
Posted by socketadmin at 11:40 AM
October 15, 2005
Forget Staging, It's Now About Posing
An instant classic! A reader forwards an email they recieved promoting a friend-of-a-friends open house this weekend. The classic excerpt:
"I have an open house this Sunday from 2-4 and would greatly appreciate if you stopped by and simply pretend to be interested buyers."
Brilliant. And yes, we have the address and listing details, but we’re protecting the (not so) innocent (for now). Suffice it to say, the open house with the disproportionate number of “interested” (and outwardly vocal) parties is probably the one. And please remember, don't always believe the hype.
Posted by socketadmin at 12:31 PM
Flippers (Not Strippers) Gone Wild
What happens when a venture capitalist and Wall Street executive get together to buy a Broadway producer’s house in the Hamptons for $14 million? According to the Wall Street Journal, they redo the landscaping, wait four months, and then re-list the property for $25 million. That's $11m in four months. Not bad (if they can actually sell it).
Only in New York? We doubt it. There have got to be some similar Bay Area stories. Now if there was only an easy way to capture, record, and share them...wait for it...yes...email: firstname.lastname@example.org.
Posted by socketadmin at 11:57 AM
October 14, 2005
You Can Relist, But You Can’t Hide
It’s a dirty little secret of the real estate trade: relist (or in this case, change agents) in order to obscure a dramatic price reduction for a property. And it probably worked a lot better before SocketSite (and our readers) joined in the fun. From a reader’s tip:
"240 - 242 Roosevelt Way was listed at $2.1 million. It dropped to $1.9+ million. Then got relisted with another agent (likely to not show a huge price reduction) currently at $1.575 million."
And yes, listed as "On Tour as New" in the MLS. Excellent, let’s keep ‘em coming. And oh, we almost forgot the best part of the tip: “Love your site.” Aww, shucks...
∙ Listing: 240-242 Roosevelt Way, $1.575m [SF MLS]
Posted by socketadmin at 10:58 AM
October 12, 2005
The Times They Are A-Changin'
Inman echo’s our previous observations (and then some) concerning the abrupt slowdown in local open house traffic:
All the signs are there: no more double parking to get a sneak peek at an open house showing; no more buyers sweating it out to make the best offer among dozens, agreeing to feed the neighborhood squirrels or not to ever under any circumstances remove the old family curtains from the second-floor bedroom – just to get into that house...
The frenzy is over. Agents sit alone on Sundays waiting for a buyer to come and try the dip. Listings are piling up in some markets as buyers realize they're gaining back some leverage.
This is the end of multiple offers as we know it. Gone are the days of desperate buyers paying $60,000 or $80,000 above asking price. Gone are the days of real estate agents shoving them aside on their way to the lucrative listings.
And damn, you'd think we'd at least get a nod for that "double parking" line we used three weeks ago...
∙ The end of multiple offers [Inman]
Posted by socketadmin at 1:34 PM
October 11, 2005
Flexcar Comes To San Francisco
As of today, City Carshare and Zipcar have some competition in the San Francisco car-share arena. Two important things to note: 1. up to 75% of Flexcar’s fleet will by hybrid vehicles, and 2. if you join and drive by the end of the year, Flexcar will waive both the application and first years membership fees (details).
We only mention it because we’ve added Flexcar to our “Getting Around” section of “Resources & Links”. If you didn’t even realize that we had a Resources & Links section, perhaps now would be a good time to check it out...
Posted by socketadmin at 1:46 PM
San Francisco Loses 85,000 Jobs
Well, so much for justifying the San Francisco real estate run-up over the past five years on a booming local job market. According to the Examiner, “San Francisco has lost 85,000 jobs since 2000 when the flood of high-paying technology jobs began drying up.” That’s 10% of the entire City’s population. Any agents care to comment?
∙ S.F. commissions economic study [Examiner]
Posted by socketadmin at 1:25 PM
October 10, 2005
Boast Busters (SocketSite Style)
On September 20th, real estate agent Matt Lanning posted the following to his blog:
There is a veritable saturation in the market this week of way too many homes. This will last for a couple of weeks, then that will be it, more or less, for the rest of the year. Don't be fooled into thinking that this stockpile of inventory is a trend. It is a one-time occurrence. And you can quote me on that.
Okay, we will. A couple of weeks have now passed and we’ve been waiting with bated breadth. We know California inventories have since spiked, but what about San Francisco and the Bay Area? Consider this a general “shout out” to all our readers and a request for any and all information on local inventory levels (email: email@example.com).
Posted by socketadmin at 11:17 AM
Word Of The Day: Palpable
Under the heading “Signs of a changing real estate market”, Inman News kicks off a three-part series on the rapidly changing real estate market. And wouldn’t you know it, Northern California takes center stage.
Visitors cruised through the two-bedroom, one-and-a-quarter-bath Northern California home offered for $479,000, but "not as many as there would have been six months ago, or even three months ago," said Maggie Resnick, the Prudential California Realtor overseeing the open house. "The market has changed, and it changed quickly."
Out of 11 people who cruised through the house in Richmond, Calif., three couples were neighbors checking out the house and three were selling their own homes and looking for marketing ideas and comparing prices. The lone remaining visitors, a couple currently renting in Richmond, were the only potential buyers – and they said they were "not interested" in the house.
“August is slow, so everyone said maybe that was what was going on," said Resnick. "Then September came, traditionally a busy time, but things are still not going quickly. There's a palpable change in the market."
That’s right, “palpable”. And although we try not to link to sources that require a subscription, in the case of Inman News, the current days articles are free. So if you’re going to read the full article, do so before midnight tonight.
∙ Signs of a changing real estate market [Inman]
Posted by socketadmin at 9:19 AM