June 20, 2007
A Neighborhood Comp, And So On, And So Forth (48 Cayuga)
After two weeks on the market, the list price on 48 Cayuga Avenue in Mission Terrace was dropped by $100,000 (12.5%). And it’s now listed at $699,000. It’s not the “Major price reduction!” that caught our attention, however, but rather the “Please note purchase may be a short sale and subject to lender approval.” It’s recorded as last selling on 5/31/06 for $825,000.
And never mind the challenged location. Keep in mind that for the past twelve months, this property has been a local market/neighborhood “comp.”
∙ Listing: 48 Cayuga Ave (2/1) - $699,000 [MLS]
First Published: June 20, 2007 3:00 AM
Comments from "Plugged In" Readers
What challenged location? They have this posted on craigslist in "Glen Park"... :)
Posted by: anon22 at June 20, 2007 7:34 AM
Yeah, the location is not ideal since the house is adjacent to I-280 and the Mission viaduct; however, it is walking distance to the Glen Park Bart station, Canyon Market, and the Manila Oriental Market on Mission.
Posted by: phil at June 20, 2007 10:46 AM
So it begins........... SF doesnt appear immune to the realities of the market after all.
Posted by: anon at June 20, 2007 4:15 PM
Wow. At $850 per sqft for this location, the buyer basically got robbed. All of the other oomps in this neighborhood suggest a price of around $550 per sqft. To me, this is a reminder to use some common sense -- not that the SF housing market is in trouble. Poor judgment happens everywhere...even in SF.
Posted by: Anon at June 20, 2007 10:07 PM
"So it begins..........."
Someone has been posting this for months. Did "it" just begin with this house, or did "it" begin months (if not years) ago when someone started posting "So it begins..."?
And what is "it," exactly?
Posted by: Dan at June 20, 2007 10:49 PM
Everybody knows what "it" is. That real estate in the city starts to sell at prices that dont reflect the irrational exuberance for sellers of the past few years and when it makes financial sense to buy in SF rather than rent. Or move out.
Posted by: Geoff at June 21, 2007 12:35 AM
Zero down rears it's ugly head in this situation.
Posted by: anon at June 21, 2007 9:02 AM
Or was it mortgage fraud? Cash back from seller, thats been going on a lot in the past few years
Posted by: rec at June 21, 2007 9:53 AM
I drove by the house and it literally backs onto the 280. There's definitely something strange about this one...Somebody in this transaction got fleeced.
Posted by: Willow at June 21, 2007 12:25 PM
So Willow, you ARE from LA? The 280? Hmmmm...
Posted by: anon at June 21, 2007 2:14 PM
It could fraud but I don't really know. The lot is small and the sq ft. of the house is under 1k.
All I know for sure is that there two loans recorded and they total 100% of the selling price.
Posted by: anon at June 21, 2007 2:41 PM
“So Willow, you ARE from LA? The 280? Hmmmm...”
No, I’m not from LA. Is there something in referencing the 280 that would suggest I am?
Posted by: Willow at June 21, 2007 3:03 PM
I guess people from LA put a "the" before their freeways as in "the 10" or "the 210" whereas San Franciscans drop the "the".
Perhaps another attempt to start an SF-LA fight.
Posted by: anonymous at June 21, 2007 4:00 PM
And we don't want another one of those battles.
"Can't we all just get along".
BTW...I also think this could be a case of mortgage fraud.
Posted by: anom at June 21, 2007 4:29 PM
"Everybody knows what "it" is. That real estate in the city starts to sell at prices that dont reflect the irrational exuberance for sellers of the past few years and when it makes financial sense to buy in SF rather than rent."
You mean the fact that you can now get a little shack in the Outer Mission, perched up against the freeway, for only $699,000 (subject to lender approval, of course) means it now makes financial sense to buy in SF?
Posted by: Dan at June 21, 2007 4:32 PM
that is what is so crazy about this --- we are all shell shocked from the last few years (unless of course, you are one of the lucky ones that sold and made off like a bandit)...
that $699K is definitely less than what others in Glen Park are asking so it seems like a deal...
wonder how long before some rationality sinks back in... maybe its just going to take the fact that there are simply less buyers who can pay these prices to get the market to shake out a bit..still, as socketsite says, it was quite a frenetic few weeks there of sales so lots of folks still have money to buy.
Posted by: wondering at June 21, 2007 5:49 PM
No Dan. I think we are agreeing. Its nuts to pay that much for this place or other properties that are so out of sync with income levels and the affordability index. Something has to give sooner or later.
Posted by: Geoff at June 21, 2007 6:23 PM
How much are places in nasty sprawling Sili Valley going for? Ohhhh, just as much as here. Ok.
Posted by: anon at June 21, 2007 7:12 PM
Amen, Dan! When did $699k become a reasonable price for ANY house but a 6 bedroom mansion?
Since the median home price in the US is $220k, and this house is FAR below "average" - whether it's located in the "above average SF" (read: sarcastic) or not - I think it should sell for no more than $200k. (Btw, I can barely afford the mortgage on THAT)
Posted by: rg at June 22, 2007 5:08 PM
rg, this house is certainly overpriced, but trying to use the US median is ridculous. The fact is this - this house would cost more than the US median in San Mateo, in San Jose, in Gilroy, in Oakland, in Santa Rosa, and even in Tracy. The US median will always be lower than California. CA prices will probably never again match to incomes in the same way that prices on housing do in many other states. There is simply too much pressure from outside forces. That's why even places that are not that great will sell for high prices and towns that are not anything special will have high-priced real estate (see Tracy).
Posted by: Mort at June 22, 2007 6:02 PM
If one looks at the S&P index for San Francisco, versus the national index, each set at 100 in 2000, one sees that the national index is higher than San Francisco's. In other words, since 2000, national home prices have risen at a faster rate than in San Francisco.
Of course, prices in San Francisco are much higher than elsewhere, but it's notable that real estate appreciation here in the past several years has not been disproportionate to elsewhere the nation. Two bedroom homes on the freeway in the Outer Mission have long cost more than very large homes in Ohio and Texas.
Posted by: Dan at June 23, 2007 11:15 AM
Dan, I agree that comparing absolute prices in San Francisco to prices in Ohio is pretty much so like comparing apples and oranges. With that said, prices in SF actually have historically risen faster than they have nationwide. Even since 2000, SF appreciation has outpaced the national average as shown at the following link for S&P: http://www2.standardandpoors.com/spf/pdf/index/CSHomePrice_History_0329-10x.xls
I guess the real question is if this appreciation difference is justified or will it correct itself over time.
Posted by: Lance at June 24, 2007 5:35 PM
What do you guys mean by "mortgage Fraud"? Who's being fraudulent, the lender? Or the Lendee who most likely overstated their income to get the loan that they couldn't afford?
Posted by: Scott at July 6, 2007 7:55 AM
Good lesson and learn, once again owner got setup by the real estate agent, or the owner need to be re-educated on investment 101.
Clearly it just the start of the big slide on the housing market, more bloodbath come down to the road. Wait and See.
Posted by: Tom at July 19, 2007 2:57 PM