Last week the sale of the bank owned 246 2nd Street #1302 closed escrow with a reported contract price of $775,000. That’s roughly $125K below what #902 sold for late last year; roughly “$150K Below Last Sales Comp in Building!”; and exactly $220K below what the seller of #502 is currently asking.
Granted, #502 also offers a 600 square foot deck, but with roughly 50 fewer square feet of indoor space as compared to the other two. And all three appear to share the same quality of finishes.
Damn those unemotional sellers to hell. And once again, “that’s not likely to be a neighbor(hood) pleaser.”
UPDATE: As a plugged-in reader notes, with a notice of default in hand, #502 appears to be on its way to being bank owned as well.
∙ One Part Bank And One Part New Building, But Any Parts New Market? [SocketSite]
∙ Listing: 246 2nd Street #502 (2/2) – $995,000 [MLS]
Don’t worry…I heard this building is filled with Google-naires who don’t care about losing a few hundred thou here or there…
Realty Trac shows a NOD on #502. The property also looks to be highly levered. After 90+ days on the market, this listing is probably toast.
Wow, r, you’re good!
Wow. If 502 goes REO, comps in this building will get crushed. 175 Bluxome is another building that ain’t looking so hot. And here’s a foreclosure at the Beacon:
http://sfbay.craigslist.org/sfc/rfs/603840639.html
I hear music. The limbo contest will probably start soon…
Well, this comp isn’t in Prime SF so it doesn’t really count for anything.
Plus, all Google-aires moved to Noe Valley in 2006. Didn’t you hear?
I’m not sure how much a deck is worth. but that is a killer deck, I’m not sure I’ve seen anybody with a deck like that in that neighborhood for a long time
needless to say, it is unlikely it’s worth $200,000… but it is a great deck.
Imagine the great parties you could have on it on the sunny warm days (yeah yeah, I know there aren’t a lot of those but still)
A deck like that is the perfect before or after spot for a Giants game.
I don’t know too much about foreclosure listings, but Propertyshark shows that Unit 1003 just went into foreclosure too. It’s a 2/2, sold for $950K on 10/13/05, foreclosure entered 3/06/08. The auction is scheduled (again, according to Propertyshark) for 3/25/08, and the unpaid balance is $799K. SO, it looks like there will be ANOTHER REO by the end of this month!
Looks like this building is falling apart. Someone pointed out a while ago that Unit #1302 sold NEW in year 2000 (!) for $750K!! (hehehehehe) I hate to think what is going to happen when SF is not a bull market! (hehehehe)
I hope that anyone who bought here in the last few years used 100% financing. Any real cash put in by those buyers as downpayments – and of course any principal payments made on their mortgages – has now gone to money heaven.
I wonder what the comps in the building will be in a few months??? Nice Deck…
What do (does?) NOD and ROE mean? Thanks
Dear Satchel– try not to take such obvious glee in these buyers’ imminent misfortune. That’s my role, after all. You’re supposed to be the all-seeing, all-knowing economist guy. Fluj will play the cheerleading Realtor(TM) and tipster can be our resident conspiracy theorist.
Fair enough, Jimmy (Bitter Renter). I relinquish the glee to you!
Some hard economic (and dispassionate) analysis. Unit 902 sold last summer for $900K. 902 is the sam floorplan as 1302, except that it is less valuable because it is 4 floors lower. 902 sold new (according to Propertyshark) for $695K in 2000, approximately $50K less than 1302, which establishes some measure of market “spread” between the units. So, now that the market has established that 1302 is “worth” $775K, we should say that 902 is now “worth” about $725K. Thus, in the space just about 9 months, the new owners of 902 have evaporated approximately $175K of value. For those of you who are not economists, that’s burning Benjamins at a rate of around $20K per month. Not bad, and just what you would expect when you buy at the very tail end of a bubble and you are the bagholder.
Because people generally behave rationally, once ALL the information becomes apparent, one would expect that behaviors would adjust. Go through the tax records for certain selected units in this building, and you will find that a number of them (including some “mentioned” here) have just stoped paying their taxes. Sensible. No reason to throw good money after bad.
Bottom line economic forecast: expect many more foreclosures, and for the comps in this building to spiral down the drain (that’s “eco-speak”). It should be a nice race to the bottom. Last one left solvent wins.
“What do (does?) NOD and ROE mean? Thanks”
NOD: Notice of Default. When a bitter homedebtor is 30 days (usually) or more late on their mortgage, the bank mails them a letter telling them they’re in default and need to cough. First step of foreclosure.
REO: Real Estate Owned. Bitter homedebtor stopped paying and got foreclosed. The bank now owns the place and wants to sell it as quickly as possible.
Dear Satchel– thanks for the pithy analysis! Bitter Renters all over the city are rubbing their hands in glee. A couple of more years of these kinds of discounts ($20k/mo!) and I will be transformed, phoenix-like into a Bitter Homedebtor.
Wow, I thought that looked familiar. I happen to know the guy who bought #502 in 2003, and then sold it in 2005. Lucky him…his job transfered him out of town at just the right time…according to property shark he bought for $628K and sold for $950K!!! And to think I used to feel sorry for him….
BTW, that wonderful wrap around deck happens to face north. It’s pretty much perpetually in shadow, and in SF that is not much of an amenity. Also, at some point the parking lot at the corner of Howard and 2nd will be developed, which will totally block the view for this lower floor condo.
Otherwise the condo is very vanilla. Also, I don’t know if they’ve changed, but when I used to visit the building it did not have a doorman, but had these ridiculous automatic doors that stay open forever (for handicap accessibility reasons, apparently). The upshot was that the building had an incredible security problem, and they had to create special codes for elevator access. A real mess.
Jimmy (Bitter Renter),
I did a (tiny) bit more research. It appears that Unit 502 sold for $675K when new in 2000, which is LESS than either 902 or 1302 sold for back then. The listing price thus appears wholly delusional – a last desperate attempt to nab the “greatest” fool, and an attempt which I have to believe will fail (especially if any potential buyer does a google search on the property and this thread comes up). As 502 already has a NOD, it seems a foregone conclusion that it will go REO as well.
All it takes is one buyer to set a price. We shall see what happens.
That being said, this has always been a weird building with an OK location but zero amenities. No front desk, let alone a gym? Come on!
This can’t be good for SF Blu. Aren’t these 2 buildings like a block apart?
And though Blu is new and prettier, both lack any meaningful amenities…
None of you picked up on the fact that the owner of 502 is also the listing agent? The mortgage is 750,000.
$750k is the amount of the 1st. There is a 2nd in the amount of $187.5k, bringing total debt to $937.5k.
good one anon at 4:29…totally missed that. I wonder what the story is…the owner works for a little agency (three listed agents) in Pleasanton..Transpacific Properties and Transpacific Mortgage (both at the same address). It just all seems so wrong…..
I estimate that this will see for $725K based on the comps and the fact that the amrket is worse off today than it was just a few weeks ago when the other condo in the building sold for a whopping 22% less
If 502 is worth even 775,000.00 I’d be surprised. I had a north facing patio at the Fillmore Center from ’89-’95, and it was dark and cold and mildew prone 10 and a half months of the year! Love the IKEA rug in the kitchen…
Is it me or are those three white lights in the socketsite photo of #1302 too far to the left of the countertop, so that they basically hit you in the head when you are sitting there?
Shouldn’t they be centered over the countertop? Maybe they are head warmers?
I never understood this building. It’s got to be just about the worst of the worst for late 90’s SOMA architecture. The outside is especially hideous.
reality finally setting in for SF real-estate and for some folks on this site. can anyone tell me the avg price per sq ft from say 2000-2007 for areas like Pa Heights, No Beach, Nob Hill, Cow Hollow? AVERAGE pls, if anyone knows
re: “Head warmers”
Those lights are most likely placed to sit over a kitchen table next to the bar.
re “headwarmers”….
Yes, like many small condos, there really isn’t room for a full “detatched” table. It’s likely the previous owner pushed a table against the bar for three sided seating, and that’s why the lights look so awkwardly placed.
My friend who lived in 502 didn’t have a dining table…he just used the bar. It’s a real drawback to many modern condo designs that you have to choose between living room furniture and dining.
But wait, there’s more! Here’s a short sale at the Watermark, first one I’ve seen so far:
http://sfbay.craigslist.org/sfc/rfs/605172311.html
This building isn’t even 2 years old yet.
I have no stake in this building and don’t really care one way or another if the SOMA condo market goes up or down, but I remain puzzled by the borderline-sociopathic amount of what can most generously be described as schardenfreude on this site. I probably don’t want any insight into your mindsets, but I have to ask if those of you who spend so much time grave dancing ever feel any sympathy for those home buyers who weren’t as smart/lucky as you have been. What do you gain by coming to this site and relentlessly mocking those who made terrible decisions?
Let’s put this into some perspective. People buying a 2 bdrm condo for $775K are probably going to make fine neighbors. Of course it sucks the comps in the building are going down, and I feel sorry for people losing money, but at the end of the day, if you like living there, and are planning on staying a while, the price going down isn’t going to be such a big deal. Of course, if you’re forced to sell when the price is down, that’s gonna hurt.
@ misterplow – I think you will find that most of those that do the grave dancing on this site don’t own any property – therefore the comments are directed at those of us idiots who do own property in San Francisco, and don’t think the market in every area or every neighborhood is going to decline by 50%, and end up in the toilet.
It’s not a very good site for gathering information, but more or less reading all the mindless banter, opinions, hostilities, and theories (especially the ones about Google being directly tied to the San Francisco real estate market).
Schadenfreude may be generous, but on balance is it worse than “SF real estate doesn’t go down” that used to be the daily special on this site? No one should take their financial cues from bloggers – even with cute nicknames – but sometimes you’ll find pointers to really useful information. The name calling that breaks out is typical for anonymous blog comments – take a look at the Chron’s often vicious comments.
Let’s be clear here – most foreclosures are not weepy headline fodder like, “Immigrant family of 12 loses humble shack; forced to live in trunk of Corolla.”
Most are specuvestors, plain and simple, and they deserve to have their asses handed to them. People who bought with little to no skin in the game, dollar signs in their eyes, hoping to get one more flip in before the entire big top collapsed. These are the same people whose greed drove prices out of the range of normal home buyers, like the ones you refer to.
Many of us have been predicting this for a while, and have taken our share of flack for doing so. Schadenfreude? You betcha. Feels good to be right. After nearly 5 years of hearing, “It only goes up!” and “Buy now or be priced out forever!” I feel that a little turnabout is fair play. The bears deserve their moment in the sun.
Most are specuvestors, plain and simple, and they deserve to have their asses handed to them. People who bought with little to no skin in the game, dollar signs in their eyes, hoping to get one more flip in before the entire big top collapsed. These are the same people whose greed drove prices out of the range of normal home buyers, like the ones you refer to.
Is there any evidence to back this up? If we’re just pulling theories out of our asses, my guess is that the foreclosures are split between speculators and a very large number of not very sophisticated buyers who all wanted “the American dream” and were willing to let someone convince them that they could afford something that they couldn’t through the use of exotic/toxic loans.
But let’s be honest, it’s the same thing the vast majority of the American people and the US government have been doing for years.
Well, in the case of the Watermark, that building was 100% sold, right? But it still sits 50% empty, mostly dark at night. Ever been in it? A good portion of the units are vacant, 2nd and 3rd “homes” for investors. SocketSite ran a thread last year on some of the instant flips there.
And what about 175 Bluxome? Check the listings for that building – some are advertised as “Never lived in!”
ORH was rumored to be 40% investors.
Some of these foreclosures may indeed be over-extended people who bought something they couldn’t afford. I wholeheartedly agree that if someone bought something to live in, and is on the verge of losing it because of job loss or health problems, there should be some kind of safety net. Especially if they want to keep the place for the long-term.
But don’t be so sure they’re all victims – LA Times recently ran an article on people who can pay their mortgages, but choose not to because the value of their properties have fallen. They’re called “ruthless borrowers” in mortgage parlance. Smart financial move, actually.
Sidenote: I love Ferraris. I don’t own one, though, because I can’t afford it. But if a salesman talked me into it, and I financed a Ferrari at $5K a month and defaulted after 6 months, would anyone feel sorry for me? Pity the poor guy who lost his dream car and is now forced to lease an Accord or ride the bus? Unlikely. Unsustainable economic conditions, by definition, are not sustained.
As long as everyone pays their HOA fees, what’s the problem with low occupancy rate in the units, since there’d be less wear+tear and less utility costs (more money into reserves), and less potential quarrels with immediate neighbors.
I am the one who purchased 1302 last week. Nice unit, great view so far until the parking lot down the street becomes a building. When I go to the next Condo association meeting I’ll have to apologize profusely for bringing down the comps. Then again, since the unit was last sold to the bank at ~$700K, the comp actually went up. Hummm.. I wonder if they will buy that arguement.
As to the hanging lights near the counter… they’re on tracks, easily moved/removed/changed-out.
Misterplow: You are oversimplifying a very complex situation. A lot of Americans are very, very angry about the grave damage that the real-estate “boom” has inflicted on our economy. We saw this nightmare coming at least three years ago, and everyone treated us like fools and/or communists when we hoped in vain for regulatory measures that would prevent this mess. Responsible renters, in particular, are disgusted when they see people skipping out on their mortgages after months of living in a property for free, or when property owners “underwater” want a lifeline from taxpayers. The comments here are only fractionally as vicious as the behavior of the real-estate investors and real-estate agents and mortgage brokers and, yes, even the American Dreamers who created this catastrophe. The delinquents among the dreamers deserve no sympathy. They are really gamblers, and their games have stolen other people’s dreams.
Unit 502 was just relisted at $740k. This is a $225k price reduction, and will probably result in a fairly quick sale.
No front desk and no gym were the draw to to buy inot 246 2nd when it was new. Front desks and Gyms cost a lot in HOA dues and don’t deliver that much in lifestyle value. There are plenty of condo owners with gyms in their buildings that still leave their buildings and belong to a gym offsite.
Doorman are great, but human beings in the lobby are very very pricey.