December 28, 2007
Another Chance To Get In Good With The Neighbors?
Purchased three years ago for $658,000 (with a variable rate first mortgage of $526,400 and a fixed rate second mortgage of $131,600), 689 Brunswick has been on the market for 71 days and is currently listed for $699,000 (having been reduced from $714,417 two weeks ago and $704,407 the week after that). A sale at asking would represent annual appreciation of 2.0% over the past three years.
According to the listing the house is being used as an "unofficial" boarding house "but the owner, who lives there, will turn it over vacant" (perhaps another chance to get in good with the neighbors). And yes, "may require lender's approval of a short payoff."
And as an aside, we can't help but imagine how the addition of just a tiny bit of grass might enhance the curb appeal of the home (and would welcome any others' Photoshopping handiwork with open arms):
UPDATE: Okay, so we have to admit we were thinking more along the lines of photochopping the landscaping or façade to improve the curb appeal (and greenness of the home), but then again it is Friday:
"In preservationist-happy SF, houses with history hold extra appeal. A historic photo and a bit of history (possibly the one-time love nest for Mayor Schmitz) add a bit of dash to this otherwise Caspar Milquestoastesque dwelling."
To Which We Respond: Michael(s) Be Nimble, Michael(s) Act Quick
Next month Michael Cohen, a former deputy city attorney, will replace Jesse Blout as the head of Mayor Gavin Newsom's workforce and economic development department.
Cohen said much of his energy will be focused on improving the development process for builders and developers. In an interesting move, Cohen has hired Michael Yarne of the Martin Building Co., a land use attorney and developer who has publicly expressed frustration with the city's slow and unpredictable entitlement process.
Yarne successfully led the public-private partnership that built the new Mint Plaza off of Fifth Street.
Aiming to be more strategic as well as proactive in attracting fast-growing Chinese companies to San Francisco, Cohen acknowledged, "to do this right, we need to be nimble," a word which isn't at the tip of our tongues when it comes to describing San Francisco's current planning and entitlement process.
∙ New city exec aiming to speed up development [Business Times]
JustQuotes: National New Home Sales Drop To 12-Year Low
"Sales of new homes in the U.S. fell to a 12-year low in November, pointing to bigger declines in construction that will hobble economic growth throughout 2008."
"Purchases fell in three of four regions, led by a 28 percent plunge in the Midwest. Sales dropped 19 percent in the Northeast and 6.4 percent in the South. They rose 4 percent in the West."
∙ Sales of New Homes in U.S. Dropped 9% to 12-Year Low [Bloomberg]
December 27, 2007
Now Would That Be A Pre Or Post Prison Martha Stewart Design?
We know, we know, not everyone is in the market for an eleven million dollar Belvedere "compound." So how about a more modest $5,600,000 waterfront Belvedere home "personally designed by Martha Stewart, a friend of the current owner in the style of a 'Luxury loft'" with a "gourmet kitchen personally designed by chef Michael Chiarello?"
And as if those two aren't names enough: "For the full price, seller will consider including the furniture including Dakota Jackson and Holly Hunt designer items from Randolph and Hein and Kneedler Faucher, custom built Honduras mahogany dining table and Parisi Chaise Lounge with Design Tex swayed fabric."
Oh, and the "beautiful mahogany used to build the dresser and bed in the master bedroom was originally earmarked to make Gibson guitar[s]."
∙ Listing: 57 West Shore Road, Belvedere (4/3.5) - $5,600,000 [Olivia Hsu Decker]
∙ Sitting On A Deck (Or A Dock) By The Bay: 210 Beach Road [SocketSite]
On The Ritz-Carlton Residences On The Spot
"As long as you don't look up, the restoration of San Francisco's de Young Building is the architectural feel-good story of the year.
Eleven stories of ruddy sandstone and brick command the corner of Kearny and Market streets every bit as robustly as they did in 1890, when the building that then housed The Chronicle opened as the tallest tower on the West Coast. You'd never guess that for 40 years the walls were hidden behind drab metal panels with a pseudo-modern look.
Unfortunately, the story doesn't end with a dowager's face-lift. To finance the rebirth, city officials let the developer put a tower in back. And that addition is so uninspired it almost undoes the good work below." (S.F.'s restored de Young building stunning at street level)
Largest, Highest, And Least Expensive (Studio) At Baycrest Towers
We don't have any insight into the relative merits of these three. But we will note that 201 Harrison #924 hit the market last week at $375,000 which makes it the least expensive ($375,000 versus $384,900 and $435,000), largest (432 versus 410 and 347 square feet), and highest floor (ninth versus third and first) studio condo currently on the market within Baycrest Towers. Or in agent speak, "Priced to sell. Motivated seller."
December 26, 2007
October S&P/Case-Shiller: San Francisco MSA And Price Tiers Fall
According to the October 2007 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 2.1% from September '07 to October '07 and are down 6.2% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 6.7% (having fallen 1.4% from September).
Miami surpassed Tampa in October, reporting a double-digit annual decline of 12.4%. Tampa followed with -11.8%, Detroit with -11.2% and San Diego with -11.1%. Six of the metro areas are now posting double digit declines in their annual growth rates. Atlanta and Dallas finally entered negative territory, with declines of 0.7% and 0.1%, respectively, leaving only Charlotte, Portland and Seattle as the MSAs still experiencing positive annual growth rates.
Prices fell across all three price tiers for the San Francisco MSA.
The bottom third (under $604,785 at the time of acquisition) fell 5.3% from September to October (down 17.0% YOY); the middle third fell 2.2% from September to October (down 7.2% YOY); and the top third (over $853,245 at the time of acquisition) fell 1.2% from September to October (up 0.8% YOY).
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Broadbased, Record Declines in Home Prices in October [Standard&Poor's]
∙ September S&P/Case-Shiller: San Francisco MSA And Price Tiers Fall [SocketSite]
Sitting On A Deck (Or A Dock) By The Bay: 210 Beach Road
Okay, so 210 Beach Road isn't in San Francisco proper but rather just across The Bay on Belvedere Island. And it's not just a house, but rather a "compound" that consists of a 3/3.5 main house, a 2/2.5 guest house, a 1/1 Au Pair suite (below the three car garage), and a 1/1 boat house with private pier and dock (perfect for sitting by the Bay).
And while $11,500,000 might be out of reach for some (okay, so most), it is $5,000,000 closer than in 2006 when they were asking $16,500,000 (but didn't find a buyer).
JustQuotes: We The People Do Want Our Federal Building Views
"Even though [San Francisco's new Federal Building] at Seventh and Mission streets was designed to allow Jane and Joe Citizen to explore the lobby and an open-air "sky garden" that starts on the 11th floor, some agencies inside want to keep us out.
Yes, there's a guard at the entrance. Individual agency offices can't be entered without keys or automated codes. But at least one department isn't satisfied with the security, so it wants more.
Officials promise that We the People will have access. "One of the goals of the building is that people should be able to flow in and enjoy the public spaces," says Gene Gibson, the Pacific region spokeswoman for the General Services Administration. "We want this to happen as soon as we can."" (How's it going? Updates on Bay Area's big building projects)
∙ Morphosis: United States Federal Building [arcspace]
December 24, 2007
525 Laidley Sells For Over Asking! (But Less Than Previously Paid)
It’s a plugged-in tipster that notes 525 Laidley in Glen Park recently closed escrow rather quickly for “over asking” (listed for $1,295,000 and closed for $1,340,000) and quite possibly with “multiple offers.” And we’ll note that the “median sales price” for single family homes in District 5 (which includes Glen Park) is up 4.1% over the past year.
And while all those stats (over asking, multiple offers, and median sales price up) are sure to be seen as signs of market strength by some, the sellers might have a different perspective:
The previous owners bought it in a private sale for $1,406,000 in April 2007 (yes, eight months ago). This was not intended to be a flip but they put it on the market two months later because one of them got a new job out of state. In the meantime, they had put maybe $10K into the house. The listing price was $1,395,000. They received multiple offers but it didn't sell because "the number" they were holding out for was $1,465,000, as anyone who attended an open house was told. I guess that was the number that would cover their brokerage cost?
They then took it off the market for a while and relisted it a few weeks ago with a new agent at $1,295,000. They did no work on the house in the meantime but the major positioning change was that they now quoted and advertised the number of square feet (3200). Before, that number had been left blank. The house sold quickly for $1,340,000, much less than the offers they had turned down a few months before.
All of which leaves our tipster wondering: 1) “I understand pricing a house lower than you think it will sell for in order to spark a bidding war. But why would you price a house lower than you will accept?” And 2) “Under what circumstances does an agent NOT list the square footage and what could have changed in a couple of months? My guess was unwarranted additions but I don't see any permits filed to correct that.”
December 21, 2007
QuickLinks: Europeans Go Holiday Shopping
In For New York
SoMa Grand: A Reader’s Unofficial Sales Update And Insight
From a plugged-in reader who’s now in contract at SoMa Grand:
SoMa Grand is currently at about 35% contracted or occupied, reporting 90 under contract of  units as of this past weekend…. While no official incentives are available, they are willing to throw in upgrades, especially if you buy without parking. Their design center is also open now in a model unit.
As you might recall, we reported an official 30% in contract six weeks ago (a difference of roughly 15 units).
∙ Soma Grand (1160 Mission): Status And Sales Update [SocketSite]
1330 Greenwich: From Listed, To Sold, To Owned (With Perspective)
As we wrote about 1330 Greenwich Street on November 8: “…it’s unique and it might have potential. And yes, we just so happen to be partial to both.”
As Cece commented on December 14: “MLS say this property sold and closed yesterday for $1,015,000.” [It was listed for $849,000.]
And as Janet added on December 19: “And we're the new owners! I loved reading all of the comments - we love it for its quirkiness and yes, charm. If you could have seen our last project....before and after, that is.”
[Note to Janet: Congratulations (on both the purchase and perspective); we’d love to see before and after shots (of either project); and don’t forget those invitations to the housewarming.]
Posted by socketadmin at 10:54 AM
Pacific Union Closes Their South Beach/SoMa Office (38 Bryant)
As a number of reader’s have either asked or emailed, Pacific Union has in fact closed down their South Beach/SoMa office.
Another Chance To Be A Hero (Or Show Your Support For The Bears)
A colorful bit of context might be in order. And yes, there’s double entendre in the title.
∙ Listing: 46 Tingley (4/2) - $599,000 [MLS]
∙ It's Gonna Be A Bright, Bright Sun-Shiny Day (Outside At Least) [SocketSite]
While One Marina Data Point Closes Escrow, Another Is Withdrawn
1774 Beach Street closed escrow yesterday with a reported contract price of $1,410,000. Having last changed hands for $1,345,000 on 10/31/2006, and without any major improvements since the last transaction (as far as we know), the sale suggests annual appreciation of 4.2% over the past 13 months. (Obviously the seller must have underpaid in 2006...)
On a related note, the listing for 3324 Octavia #4 which was last asking for $1,000 less than what the sellers had paid in 2004 has been withdrawn from the market after a little under two months.
∙ Listing: 1774 Beach Street (2/2) – $1,345,000 (sold) [1774beach.com]
∙ When Good Comps Go Bad (Down In The Marina) [SocketSite]
∙ Another Apples To Apples Comp In The Making (In The Marina) [SocketSite]
Planning For 5,700 New Homes In San Francisco’s Parkmerced
From J.K. Dineen at the San Francisco Business Times: “Parkmerced's owners want to add 5,700 housing units to San Francisco's largest apartment complex in a dramatic redesign that would cost billions of dollars and nearly triple the west side community to 9,000 units.
Stellar Management and Rockpoint Group's aggressive plan calls for the construction of between 200 and 300 units a year over the next 15 to 20 years. The owners plan to file an application for environmental review with the city before the end of the year, according to spokesman P.J. Johnston.
The proposal, as envisioned by architects Skidmore Owings Merrill, would reinvent the automobile-centric World War II-era community as a denser, more pedestrian-oriented neighborhood with a new transit stop, parks, and grocery shopping. Ten of the 11 existing 13-story towers would be preserved. Approximately 70 percent of the 5,700 new units would be in townhouses of three or four stories. Others would be in new towers up to 13 stories. The housing will include a mixture of rental apartments and for-sale condos.”
“The heart of the future Parkmerced would be a new Muni station. The developers are proposing to bankroll moving the San Francisco State University Muni station from 19th Ave. and Holloway, considered one of the city's most dangerous intersections, onto the Parkmerced property. The new station would be built on Crespi Drive and would be integrated into a Parkmerced village center with a grocery store, farmers' market, cafe, and other small shops. The owners are also considering adding one or two more Muni stops on the 110-acre property.”
"The Stellar/Rockpoint scheme calls for a number of extreme green measures. Some, like narrower streets with bike and walking paths, are commonplace. Others are more unusual, like a plan to remove the entire property off the city's power grid and instead generate electricity through wind turbines and microturbines that operate on a variety of gaseous or liquid fuels and emit very low emissions. Skidmore's design partner for the project, Craig Hartman, said cleantech advances can reduce energy consumption by 62 percent per household. A highly-efficient plumbing system and a new water recycling plant could reduce water and sewer consumption by 43 percent per home, he said."
December 20, 2007
San Francisco Sales Activity In November: Back Down (-15.7% YOY)
According to DataQuick, sales volume (i.e., demand last month) for existing homes in San Francisco fell 15.7% on a year-over-year basis last month (479 sales in November ’07 versus a revised 568 sales in November ’06) and fell 8.9% compared to the month prior (526 recorded sales in October ‘07). As we noted last month, it appears as though October’s uptick in reported sales activity was at least partially driven by a delay in September closings rather than a much ballyhooed rebound in buyer activity.
At the same time, the median sales price in November was $814,750, up 7.2% compared to a revised November ’06 ($760,000) and up 2.5% compared to the month prior. And yes, for some strange reason we’re still thinking mix.
For the greater Bay Area, sales volume in November was down 36.2% on a year-over-year basis and fell 6.5% from the month prior (5,127 recorded sales in November '07 versus a revised 8,042 in November ’06 and 5,486 this past October). The recorded median sales price fell a nominal 0.3% as compared to the month prior but was up 1.5% on a revised year-over-year basis.
At the extreme, Solano County recorded a 50.2% year-over-year reduction in sales volume (and a drop of 14.8% in median sales price) while Contra Costa County recorded a 46.0% year-over-year drop in sales and a 6.9% drop in median sales price despite a reported 1.3% growth in population from July 2006 to July 2007.
∙ Bay Area home sales stuck at two-decade low; price picture mixed [DQNews]
∙ San Francisco’s Sales Volume Up And Down In October [SocketSite]
∙ Listed San Francisco Home Sales Volume Down/Down In November [SocketSite]
∙ JustQuotes: CA DOF Estimates Population Growth In San Francisco [SocketSite]
JustQuotes: CA DOF Estimates Population Growth In San Francisco
“The Bay Area's population growth rate outpaced the state last year as the nine-county region, led by San Francisco and Santa Clara County, added nearly 90,000 new residents, according to the Department of Finance's latest data released Wednesday.
Santa Clara County saw the area's biggest gain, attracting 29,904 new residents for a 1.67 percent increase from the previous year for a population of 1.8 million as of July 1. San Francisco was second, growing by 1.4 percent to 11,327 and bringing its population to 817,537. Contra Costa County was third with 13,189 new residents, or a growth rate of 1.28 percent. It now has 1.04 million residents.”
Their Mascot Might Be A Bull, But Merrill Lynch Is Anything But
The title of yesterday’s Economic Commentary from Merrill Lynch: “Housing deflation could be a multi-year process.” And the executive summary:
Both the near-term and longer-run outlooks for the housing market remain clouded in what is a severe downturn in starts, sales and prices that has become national in scope. As we saw in the November housing starts data, the builders are now frantically cutting production.
But with the sales backdrop still softening, they may have to slice their construction plans by another 30% before we hit bottom on a cyclical basis. And, that bottom could be as long as a year away. Beyond that, weak demographic fundamentals point to years of sluggish real estate activity, particularly in terms of the “price”. The looming dominance of the “move down” buyer suggests that home values will continue to soften long after the building industry mops up the current excess supply. In fact, real estate pricing in general can be expected to be in the doldrums through 2012.
The need to save for retirement will have to increasingly come “organically” in the form of setting aside an extra nickel or dime from every dollar earned in after-tax wages and salaries as opposed to what we as a society have been doing for the better part of the past decade, in essence, blurring the distinction between real estate as a “consumption good” (place to live) and real estate as part of the “portfolio” (investment) that was going to experience sustained double-digit appreciation and emerge as a fountain of cash-flow in the future.
Expectations are already in the process of being deflated and we are at the early stages of a savings revival in the traditional sense of the word, and this will (i) be deflationary for the aggregate demand curve; (ii) be bullish for Treasury bonds; (iii) act as an underpinning for the dollar insofar as this process continues to foster an improvement in the current account deficit (which, excluding energy, is down to a six-year low).
See the chart [above] – at the height of the bubble, almost one in four households who were contemplating a move into real estate based their decisions on future price appreciation. This “investor class” that dominated the housing market for so long has now seen its share dwindle to a record low of 4%. This is a very big deal as it illustrates just how far the speculation has been expunged, and it also heralds a major (and healthy) shift in how the public now perceives real estate.
And while the report is national by nature, there are obviously themes that might resonate right here at home. And of course, there’s the punch line:
Here is what we really “do not get”. There are still economists out there talking about how the housing recession is still local and not regionally broad based. We have no idea who their data vendors are. In our view, this clearly goes down as the most national real estate downturn since the 1930s.