One Rincon Hill Pool
With a reported contract price of $1,423,500 in August 2008, One Rincon Hill (425 1st Street) #5002 is back on the market and asking $1,595,000. Yes, it’s another infamous “02.” And yes, we have the pool.
∙ Listing: 425 1st Street #5002 (2/2) – $1,595,000 [MLS]
One Rincon Hill (425 First Street): Secondary Market Stumbles [SocketSite]

107 thoughts on “Another One Rincon Hill ’02 (But More Importantly A Pool)”
  1. So this “owner” thinks that during the greatest financial/economic crisis since the great depression this property went up in value by 42k a month?
    Clearly someone needs their medical marijuana card revoked.

  2. um, starting the new year with a bang?
    how about starting the new year intelligibly?
    ‘and yes we have the pool.’
    what?

  3. Well, the saying “hope springs eternal” was based on people just like this.
    Gotta love the type of person who closes on a 1.5 millionish place during an obvious economic downturn and then tries to sell it MONTHS later. Sounds like an amazingly prudent fiscal planner.

  4. The water in the foreground is not a pool, it is an infinity edge platform. The pool is in the right background.

  5. Strange,
    It says its a 2 bedroom 2 bath, but only 2 out of the 14 pictures are of the interior. Why not show the whole unit?

  6. I’m GUESSING that they basically chose the price by taking the purchase price, adding in the cost of ownership thus far (monthly payments) and then adding 6% for RE/selling fees.
    most likely they’re trying to get out of this without a loss.
    that outdoors space is great. I love sitting out there on warmer nights… the carnoise isn’t as bad at night. it’s somewhat loud in the daytime though, but still a cool place. I have no idea who would swim in an outdoor pool in San Francisco, but it is heated (or so I’m told, I’m not jumping in there).
    also, very few people use that entertainment center (or whatever they call it) that’s right by here but inside. so you can go down there and watch TV and then chill by the reflection pool.

  7. boy these prices are sticky….
    saw soemthing else listed at the watermark that was also over priced. amazing to see soma condos not a lot lower by now given no real volume here.

  8. “I have no idea who would swim in an outdoor pool in San Francisco”
    Answer: real swimmers. I was just running past aquatic park and checking out bay swimmers wearing just speedos and caps when it was 45 degrees outside. A 78 degree heated pool is cake compared to that and and never crowded in the winter!

  9. good point anon. real swimmers will use this pool so long as it is either 25 or 50 yards/meters. I’ve never seen it in daylight to do a quick eye measurement of the pool.
    I’m not a “real” swimmer, but I am occasionally a lap swimmer. but I just go to the Emarcadero Y instead to swim when I’m at ORH. and the Emarcadero Y sucks. (it’s better than a lot of the SF YMCAs, but it sucks comparatively to the rest of the country, and the pool is horrendously overcrowded.)
    next time maybe I’ll try the ORH pool and see what it’s like.
    I would never swim in Aquatic park, but you’re right, they’re out there every day.
    ORH buyer: you know the measurements on that pool?

  10. does anyone know the availability of 2 bedroom units at ORH that are for sale? I like this building but I am pissed off that it was deemed to be sold out right after it was opened and that was a lie.

  11. ex SF-er,
    As a triathlete, I swim in Aquatic Park frequently (not in the winter, though, brrr), and it is not as cold as it looks, esp on a sunny day. Those Dolphin Club swimmers have a strong threshold for the cold.
    I am very surprised by the lack of good swimming pools in SF, even though swimming is such a popular sport for the Bay Area. Here are my suggestions: the Koret Center (USF) and UCSF Mission Bay are supposed to have the 2 best pools in SF (not been yet, not very convenient, and pricier). I swim at the Presidio Y, which is actually a really nice pool, esp. for the money. I used to swim at the North Beach Pool (public), which is $3-4 a swim, and is absolutely gorgeous. It is a multi-million dollar pool (similar to the Sava Pool) with tons of natural light and roof, which opens up. There is also a sauna. It is currently closed due to maintenance, and does not have as many lap times available as other pools.
    Socketsite, why don’t you feature the architecture of the relatively new public pools in SF? I love the architecture of the NB pool, esp inside and while swimming (you can see Joe Dimaggio’s church, sorry, don’t remember its official name).
    Socketsite, can you have more posts on rental costs/neighborhood (what are tenants actually getting these days, not craigslist posted prices)? It will be a while until i can afford a million dollar 2 bdr condo.

  12. I swim every day at the outdoor UCSF Mission Bay pool (downstairs, there is a smaller indoor pool, mostly for the kids). It’s cold out there on that rooftop by the bay– like Candlestick Park, only you’re wet– but it’s warm (usually!) in the pool.

  13. Ryan,
    I represented the buyer when he bought from the developer, and he asked me to rent out the unit for him, but we didn’t get any love connections as a high end rental.
    Mike Machado always does an excellent job and is one of the top agents in South Beach. The owner is in good hands and I know this will be a smooth transaction as long as Mike is in charge.
    Paul

  14. he asked me to rent out the unit for him, but we didn’t get any love connections as a high end rental.
    What a surprise 🙂
    I represented the buyer when he bought from the developer
    Please tell us that this specuvestor put down a large amount of $$! (That would make him one of diemos’ heroes.) If he didn’t want to live there, why didn’t he just refuse to close? (I know, he didn’t want to lose the 3%… Bet he never saw the greatest collapse since the GD coming, lol)

  15. LOL, Paul.
    I know others think you are an insect, but I don’t have any problem with your stuff. Just doing your job, and unlike with some of your fellow realtors I don’t get the sense that you think your understanding of the markets is superior to those who aren’t “in the trenches”. It’s a sales role, and I’m ok with that. Best of luck in the New Year!

  16. Paul,
    Let me know when a 3/2 (pref. with Eastern view, but I’m flexible) at the Infinity becomes available for $700-800K – – preferably closer to 700k. And I don’t mean the 1200 squ with no views in the basement, either. It has to be at least 1600+ sf to be worth it for me. Yes, I am serious.

  17. apt name sfloser,
    ” Paul just lost at least a couple 100k for yet another “satisfied client”?
    why do you blame the salesperson?

  18. 700-800k at the Infinity with views? Just to double check – you are serious? As in you think this will happen at some point? Or are you just hoping and praying for a miracle? I wish the best for all looking to buy but hope this never happens or I am sol.

  19. Maybe not 700-800k for a 3/2, but I am willing to predict that at the bottom it will be possible to get a 2/2 at the Infinity for 700-800k.

  20. 700-800k for a 3/2 at the Infinity is well within reason when we hit the bottom in about 3 years! People have to get realistic about housing prices… even in The City where everybody wants to live!

  21. @paco
    “why do you blame the salesperson?”
    I imagine it was all the homeowner’s fault. Realtors shouldn’t be responsible for home valuation, seller expectation, etc. That takes more more than a 6 six week correspondence course, no?

  22. (Interestingly bifurcated discussion: prices or pools? I’m for pools.) Ex-SFer: You should try the pool. It’s kept at 78 degrees, and it’s never crowded. I swim laps there. I confess I wait until the sun comes around the building and shines on the pool, for a little extra warmth, but I’m happy with it. There was a nice crowd out in that area on New Year’s Eve, watching the fireworks.

  23. thanks for the suggestions guys
    I’ll try the pool next time I’m there. Skyguy: you know if the pool is 25 or 50 metres (or yards)?
    I’ll also try some of your suggestions MarinaRenter, they sound divine.
    I just HATE the cold, especially when I’m swimming. Even when the pool is indoors. Nothing irritates me more than cold lockerrooms and cold steps to the pool when I’m swimming!
    but again, I’m not a “real” swimmer, I just dabble. (my other half is the real swimmer and drags me to every pool around the Earth).
    FWIW: people like to compare SF to Paris. SF’s pools are 10000000000x better than Paris’. The last time I swam in Paris there were 26 people in my lane (not an exxageration, I counted them)
    🙂
    but I do love that outdoor space, even though it’s right by the highway. when I’ve been there at night it’s been deserted (or very few people there).

  24. “Paul,
    Let me know when a 3/2 (pref. with Eastern view, but I’m flexible) at the Infinity becomes available for $700-800K – – preferably closer to 700k. And I don’t mean the 1200 squ with no views in the basement, either. It has to be at least 1600+ sf to be worth it for me. Yes, I am serious.”
    Paul,
    Please let me know when a highly potent narcotic (preferably heroine, I don’t mean designer heroine) becomes available because I would like to be on whatever trip waiting2nest is currently on. Yes, I am serious.
    Real estate value hallucinations can go in both directions. What waiting2nest is looking for is the equivalent of sitting against a wall on sidewalk in downtown SF and holding out your hands as people walk by. Yes, I am serious.

  25. Of course the polar bear types will swim outdoors all year round, but most normal people will want some comfort (which in SF means indoor pool most of the time). Once you’re in the pool it’s probably OK to swim outside, but getting in and out sucks.
    BTW–I live in the Infinity and LOVE LOVE LOVE the indoor pool. Outdoor pools in SF just aren’t practical.

  26. Thanks, Paul. I have the money to buy now. I realize that 700-800k for a 3/2 at the Infinity sounds insanely low (for now) and hey, if that never happens, I don’t care. There are lots of other options, and more options will become available the longer I wait.

  27. Paul I was rooting for you, every time you take one from the bunch but really… do you think any 3/2 at the Infinity will ever be 700-800k? Really?
    Full Disc, I am not a realtor, broker, mortgage specialist or anything related. Heads up: Wells site is at 4.875% as of this afternoon, I think it includes a point, not sure but great rate either way and I see properties around me selling, yes I am being serious. Having bought over the summer I saw a huge lull from about Oct to now, but the past few weeks I have seen many shoppers and units going off the market.

  28. Oh and Paul.. although I would be happy for the buyer let us know if it does happen so I can ask the sales center whats up…

  29. My favorite part of the listing is this boast “One Rincon Hill! The tallest building west of the Mississippi, in South Beach-the place to be!!” Hmmm, the taller “south” tower is only scheduled to be 641 feet tall. Library Tower in LA is 1018 feet, and I think also west of the Mississippi. I wonder what else is a wee stretch of the truth?

  30. My gosh, No on Prop 8, that is an awful lot of court complaints against the listing agent (generally for nondisclosure and misrepresentation). Of course, a complaint is not proof of anything (for example, not a single one of my clients did anything that has been alleged against them), but it still has to give a potential buyer pause.

  31. I think Paul is just being polite and diplomatic. I met him once at the Metroplitan and he is quite mild mannered and a nice man. But in case he isn’t let me know too, I’d jump at that also.
    By the way I just checked on those new units on Cesar Chavez and the top floor is already in contract at over 1.5m, quite amazing in my opinion.

  32. “By the way I just checked on those new units on Cesar Chavez and the top floor is already in contract at over 1.5m, quite amazing in my opinion.”
    All six of those units are now either in contract, pending or sold. I wouldn’t say “already” tho. It took a while, didn’t it? (Though I believe they were heartily scorned on Socketsite.)

  33. According to the Infinity sales office, there are upgraded 3/2’s with partial views currently available for $900K — and those are “asking prices” which we all know are negotiable. Yes, I know they are the smaller units (one was over 1300 squ.ft., I think). It will be interesting to see what happens in the next year or two…

  34. waiting2nest – Just curious – Any more info? Any idea what units, tower, treetop, and what floors?
    In looking on the Infinity web site there are very few 3/2 units. High floors top of tower with 3 bedrooms (can’t imagine those going for 900k), and tree top three bedrooms of which I believe only the top two floors of each contain 3/2’s. Second floor down of each tree top 3/2’s include some pretty great terraces (can’t imagine those going for 900k). This leaves the top floors of each tree top, penthouse units (although not sure you can really consider it that)which in my mind would still be stretching it but maybe? If what you say is true, I wonder how much lower (if at all) the units are priced from original release amounts? Anyone have the info?

  35. Get over it kids – you will not see rock bottom prices at the Infinity. (3/2 views for $800k, yeah right!) If you are interested in an unit … this might be the time to buy now? Word on the streets (realtors, other blogs and the homeless guy who sleeps on Folsom/Spear) is that they are negotiating on units in Tower 1 for the anticipation of Tower 2. They are very close to hitting their mark and will not lower the price in Tower 2, with the exception of inferior layouts. There is already a list going and I heard people are asking to put deposits in the new tower but are getting declined for now. They are expecting to be close to 90 percent in contract by March O9 and when Tower 2 opens, they anticpate that 1/4 of the units will go before Q2 2009.
    What does this all mean?
    Tishman knows what they got. They plan to hold out as long as they can. They have entitlements to the lot next door and want to keep values and perception up considering the Infinity’s location is superior to the vacant land. Tishman knew they were in a tight battle when they decided to build tower 2. Unlike other properties, they went ahead knowing the second tower will sell.
    Ask any of the lenders who focus on new developments in the Bay Area and they’ll tell you that nobody can come close to touching Infinity’s sales in the last month or so. Go visit their sales office on the weekend and see for yourself.

  36. My favorite part of the listing is this boast “One Rincon Hill! The tallest building west of the Mississippi, in South Beach-the place to be!!” Hmmm, the taller “south” tower is only scheduled to be 641 feet tall. Library Tower in LA is 1018 feet, and I think also west of the Mississippi. I wonder what else is a wee stretch of the truth?
    originally, the advertising spiel was something like “tallest residential tower west of the mississippi”
    since that time, that has changed. I believe Millenium is 4 feet taller than ORH as example. although I could be wrong.

  37. So waiting2nest any more info? Not that I don’t believe you but it sounds too good to be true. Tbone yes, agreed and true. I saw a bit of a lull last few months of the year but a consistent stream of shoppers this past month on site here, and even some units that look to be entering escrow or closing. I know a few that have all ready done a refi many months after closing and are having no problem here with values etc. as well. Even in the middle of the storm everyong I talk to here loves the property and are happy they bought and got in when they did. Good signs in my opinion.

  38. gowiththeflow,
    per the Infinity sales associate, the 3/2’s I was referring are on floors 7-8. I admit I’m seeking a much lower price, but that’s because a SOMA condo is not my first choice. So, they can take my enquiry seriously or not – – I don’t care. To stay in SF, I have to factor in the cost of private school tuition for my son. Prices at the Infinity would have to come down much more for me to even consider buying. Otherwise, I could just buy a nice, spacious house in Orinda with good public schools for $1MM (or less these days).
    Anyway, if you’re planning to live in your unit for many years, and you’re not stressing over your mortgage payments, you have no reason to fret about current prices, right?

  39. Correction: they are on the 8th & 9th floors — not 7-8.
    From the email I received from the Infinity Sales Associate:
    “We appreciate your interest in wanting to live in the Infinity. Currently we have a couple of three bedrooms in our tree-top residences available on the 8th and 9th floors with limited views. They are available in the $900’s and if any of our three bedrooms have a chance of potentially being sold in the price range you’re proposing it would be these via negotiations…and the residences are already upgraded.”
    BTW: I honestly wasn’t being sarcastic or snarky with the final remark on my last post (the one before this one). I think if I were in your position: living in a place I love and can EASILY afford, I wouldn’t worry so much about current prices.

  40. Currently we have a couple of three bedrooms in our tree-top residences available on the 8th and 9th floors with limited views.
    Probably means they face the wall along the south side and the interior courtyard. Not a bad price, I guess, but I would not want to live in a place with literally no sun.

  41. Waiting2 – thanks for sharing the info, really appreciate it. Interesting.
    Not too shocked as typically the last units to go fetch a bit less in particular if there is a phase 2 ready to be released.
    Spear street tree top only has 8 floors with 3/2 on 7 and 8 and large terraces only on floor 7. Main street tree top has 9 floors with 3/2 on 8 and 9 and large terraces only on floor 8 I believe.
    Last I checked most of the terrace units are gone, or in contract unless some fell out but I don’t think so… there are only a total of 8 large terraces (able to support furniture, plants etc.) with a few additional at the top of each tower in the entire complex and they are all very nice – think Brannan outdoor terrace, few and far in between, add extra sf to your living space, and offer one to have a low maint yard downtown so to speak. I think these will hold some value and from what I recall in checking with the sales center have fetched a better price than you note.
    Also I believe these floors have higher ceilings – 10′ or so. Doubt it is any of these but if so it would be an amazing deal.
    It must be floor 9 of main and 8 of spear of which either way I personally think that is a great deal. Those 3/2 are on the smaller end for a 3 bedroom and the floor plans are a bit wonky but if you really look at the plans they are in my opin a better layout to create a 2/2 with dining than the curved tower plans or keep as a 3/2 for a small family or say in your case 1 child and a private office or guest room.
    As far as the sun – ironic but I personally think the top floors of the main street building facing south towards the neighboring building get the most sun, the building a cross does not block the entire facade as the roof line is lower and curves plus there is enough space between the two buildings to not cause issue until the sun is going down – full sun most the day. Also in facing the property next door there is full privacy – no windows or people looking in the units and they planted some beautiful bamboo with uplighting which looks great day and night.
    Units facing main obviously look at the postal parking and get a lot of light but not as much as the south facing units until end of day which in future may be blocked by the other Tishman prop if it gets built. I noticed last night all those units have curtains drawn so not sure it could be those. If it is I would say good deal.
    Units facing folsom in the other tree top, would have a downtown view so if it is one of those wow,
    even though they do not get south sun and may be blocked in the future with Transbay plans.
    Units facing spear shaded by Google and looking into Google I could see going for that as they don’t get as much sun from what I can tell and of course have no privacy.
    One other thing to consider if it is the main tree tops is that all the ammenities are in that building so those residents just have an elevator ride down to a great gym, heated indoor pool, yoga room, business center, theatre, and entertainment/party suite.
    NO worries on being snarky, never thought you were. I am curious because I did buy at the Infinity so I do have a vested interest in staying a float of what is happening with anything related to the building. I plan to be here many years, most likely more than originally planned given my experience here has been fantastic. I took time to consider buying vs. jumping in, did what made sense for me. I am not a millionaire so not sure what you mean by EASILY afford but I did buy within my means after working up the SF housing ladder the past 10+ years.
    Be patient and do what is best for you, I wish you all the best and if you do decide to buy at the Infinity there are great day care near by and lot’s of childrens programs put on by the communtiy for all the young one’s living here.

  42. Units facing main obviously look at the postal parking and get a lot of light but not as much as the south facing units until end of day which in future may be blocked by the other Tishman prop if it gets built.
    Not true at all. I live in this direction and even now there’s direct sun from about 10 or 11 am to 4.

  43. Anon this is actually funny, and from the looks of it a great way to get and exchange info.
    So you noted NO sun facing south towards the neighboring building of which I can say NOT true as I live in that direction and there is sun from the break of dawn until early evening and views (although some partial) of the bridge from many units. You get sun from 10ish to around 4ish and I get direct sun from break of to about 4ish so it must be Rincon or the Met that block our afternoon sun? Just a guess. Either way this is great, sounds like we are both in great positions sun wise.

  44. “I believe these floors have higher ceilings – 10′ or so. Doubt it is any of these but if so it would be an amazing deal.”
    gowithflow – – actually, they are the ones with 10′ ceilings.
    Again, from the email I received from the Infinity Sales Agent: “the residences are already upgraded —while one has window coverings installed both have upgraded floors and higher than normal ceilings of 10 feet. One is approximately 1275 sf while the other is approximately 1331 sf.”
    I didn’t pursue this any further because the units are smaller than I would like.
    But, FWIW, I think the Infinity is one of the nicest new condo properties in SF.

  45. Thanks for the insight, waiting2nest. So “in the 900s” for 3-bedroom units.
    We first visited the Infinity sales office when they opened, before the first tower was even built. We were told adamantly by the sales staff that there would be no 2-bedroom units under a million dollars. NONE. Flat-out. And that tower 2 would be more expensive than tower 1. They seemed so sure of themselves then, like they’d carried their pricing down on stone tablets from Mt. Sinai or something.
    We visited again in November of last year to find several 2-bedrooms in the $700K range. Now it seems even 3-bedrooms are going for under a mil. And by my math, asking prices are in the $700 to $750 per square foot range now, and likely getting negotiated lower. Whatever happened to that mythical $1,000 psf number that folks used to bandy about?

  46. Waiting, I truly appreciate the info, you have been very helpful. I think I know exactly what units they are. Although you mention your not interested in a SOMA condo, you and/or anyone interested should come take a look, if they are 900k, upgraded and with the high ceilings I would say it is definately worth it.
    Not to keep prying but any chance you know if it is Main or Spear tree top? My guess is it is the 9th floor of the Main treetop, 2 units closest to tower 2, which would get lot’s of sun and have partial bridge views I think..Checked the web site and these are the only units showing est. square ft you note.

  47. Dude if what waiting is saying or I should say the sales team is telling them is true the 3 bedrooms we are talking about should have never fetched 1mil plus.. that is why the units are still available. They are nice however, and I would say 900k is a great deal. Does anyone know if these units were ever priced much higher in the first place? I wonder if they will drop prices further as release of tower 2 draws near; I hope not but it would make sense. Catch is just like any other sale when inventory is low/almost gone who ever get’s there first get’s the product or unit in this case. Goodluck to anyone shopping.
    Nice to see that for those looking for a place to call home it has in fact become a buyers market.

  48. Sorry I am one of the loyal and honest of the bunch; unfortunately I am bound by contract as is typical with buying to not disclose actual purchase prices. I can tell you this: I monitored all price posting on SS (literally have it all in a spreadsheet), prices via word of mouth, MLS, and SF averages for almost a year before closing. I did not use an agent. I did not upgrade anything as I would never pay mark up to do what I could post closing for most likely less.
    That being said comparative to prices being thrown out on this thread I still feel comfortable with what I paid for what I got. I jumped in a bit early as I wanted a specific unit, and am happy I did because I got it. I don’t believe I am underwater, nor does the bank, I have had a few appraisals done pre and post closing by different parties and my value has held. I recently did a refi with out any problems after living here for months. Did I get what equates to est $705 psf (waiting2 900k / 1275sf) no but with out giving my address I can tell you my unit is not similar to the units being generally discussed, worth more than that, and should not have been priced at $705 psf so no big. If you search the SS archive you can find pricing.

  49. In looking at my notes gathered from past SS postings, and other collective info from 2006 to now of the units I monitored the highest psf price I see is $1497 psf for a close to top of the tower unit and the lowest is $611.90 low tower with high tree top terrace unit being $1047 psf lowest being $705 psf. Of course these are just numbers collected from quotes given to many people but gives you a wide range of pricing. You can see why the pricing being discussed does not seem out of the ordinary.

  50. “They are very close to hitting their mark and will not lower the price in Tower 2, with the exception of inferior layouts. There is already a list going and I heard people are asking to put deposits in the new tower but are getting declined for now. They are expecting to be close to 90 percent in contract by March O9 and when Tower 2 opens, they anticpate that 1/4 of the units will go before Q2 2009.”
    R u kidding me? Who believes this stuff. I live nearby, and granted, this is unscientific, but I would bet 40% of tower 1 has not closed. Ever walk by and count how many lights are on at 8PM? Maybe 20% of the units are illuminated, if not less. 3BR now going less than a million, winkwink.
    Stay away. I would bet that HOAs will rise to >1000K in 2-3 years…

  51. 1. gowiththeflow, please give us all a break, there is nothing in the purchase contract for One Rincon, Infinity or any other building that prohibits an owner from disclosing his or her sales price. Please, you really look foolish saying this. Also, the SF real property tax records give away all the sales prices anyway, you know.
    2. Re Infinity, has anyone noticed how on a cold day the steam from the adjoining server farm building creates a 20-story high white cloud that completely obscures the view to the south from over half of the first tower? Yikes

  52. yep, i just came back from the MOMA and YB Gardens tonight and looked up to the St. Regis and the top 10 floors hardly had any light on. I guess only 20% of the owners live there and the 80% is either in foreclosure/on the market/ or still empty from the sales office. get a life and stop counting lights/keyholes etc. Living in the downtown area, you should be out enjoying the beautiful city we have.

  53. Robert how do you know what I signed? Actually I did sign an agreement in which my contract is confidential. Yes, if anyone wants to get the unit prices they can in fact check the tax records. However given my name is obviously not go with the flow I would be curious to see how one would put two and two together. Needless I don’t plan on breaching my contract and did offer a “range” as requested of what I saw units going for while shopping; more than fair. The white cloud does not obscure anything. r u kidding – r u kidding? Counting lights to see how many units may be purchased is just silly.

  54. “…stop counting lights/keyholes etc….”
    in other words, please stop providing useful data points that contradict the realtor speak of “not accepting deposits” and “wait list”. give me a break.
    the number of new locks versus master locks was the best piece of data I have gotten from anyone associated with Infinity.

  55. Yes locks, locks – NOT lights. I too found the lock counting bit helpful but also a bit creepy.
    I don’t walk the building looking at locks but
    obviously see the ones on my floor as I walk by. I am happy to report as of the past weeks many shoppers on my floor and the few remaining lock colors changed to what was thought to be an in contract, escrow color.

  56. I find it comical that people actually question whether or not prices for a 3/2 at the Infinity (or whatever overpriced SOMA building you happen to be talking about) will fall to 700-800K levels. They will. And probably lower.
    Perhaps people are forgetting that San Francisco is just beginning to experience the problems that most of the other parts of the bay area have been experiencing for the last 1-2 years. Almost everyone in those buildings has a conventional ARM (at best) or an Option ARM (at worst) and you all should know about the schedule for recast of those mortgages.
    SF is on the brink of serious trouble in 2009-2010 and these outrageously prices apartments in SOMA will be hit hardest, because they are the most expensive.

  57. “Almost everyone in those buildings has a conventional ARM (at best) or an Option ARM (at worst)”
    How do you know this? I doubt many of the empty nester demographic went that route, for one.
    I agree that luxury condos will be hardest hit, tho. There’s a newness premium that will be lost. There’s also the fact that so many were built. And yeah, how expensive they are.

  58. I don’t know this, but I pretty strongly suspect it. The percentages of people who bought in the last 5-6 years in SF with ARMs is overwhelming.
    In addition, buildings like these tend to attract a younger demographic, who tend to have less savings, and these buildings are so grossly overpriced when compared with average incomes in San Francisco, that very few people can afford traditional loans for these units.
    Those factors lead me to say with a fair amount of confidence, that people who purchased units in thse buildings did so overwhelmingly with non-traditional mortgages.

  59. Hate to break it to you all but word on the street is that until recently the developer in most cases was no allowing small down payments. Also I believe most units did not start closing until early 2008, many much later and most banks were in that time period requiring what should be standard LTV’s. Ice if you have not been in a cave you should know that lending has become much more stringent with it’s uwriting standards. I can say from my experience that the bank was very stringent with DTI ratios, LTV, etc. Sure it is fair to say there may be a short term loss although I have not experienced it yet. However if one bought long term things should pan out fair enough. Besides if one holds long enough the build up of the surrounding hood should help offset some of the difference if there is any.

  60. First of all, I’m not that interested in “word on the street”. I have never seen an industry with more misinformation than real estate.
    Second, large down payment does not preclude a bad mortgage. If it is true that buyers in these buildings put down sizable down payments, then they have even less to spend on their monthly payment, and this would only increase their need for a teaser rate mortgage.
    Finally, the real credit crunch is fairly recent, starting in earnest in September of 2008, and was not really an issue in early 2008 when these contracts closed. Yes, it is currently more difficult to get an exotic mortgage, which is why we are starting to see price declines, but nothing like what we are about to see.

  61. Also, I have to say I disagree with the statement that people who bought in the last 1-2 years will make out well in the long term. Our country seems to have some short-term memory loss when it comes to real estate. Over the past 50+ years, real estate has been an average-at-best investment, generally outpacing inflation by a few percentage points. Because we are at the tip-top of a 10 year long bubble, prices have a lot of correcting before they revert to the mean, and they will revert to the mean. Sure, if you hold your apartment in SOMA long enough, it will be worth more than when you bought it, but that could take double-digit years, and you’ll have to withstand a large trough in the meantime. Other investments will, in my opinion, do much better.

  62. Wait a minute.
    The assertion of neg-am purchasers as majority was challenged, but you stood by your claim. To back it up, you say that people did 20% down on ARMs and neg-ams. Why would anybody do that?
    And now you disagree with the statememt that “people who bought in the last 1-2 years will make out well in the long term,” but go on to say if you hold it long enough it will be worth more than when you bought it.
    Yet the inital statement was actually “if one bought long term things should pan out fair enough.” You don’t disagree.
    And again, on SOMA condos. A huge amount were built at around the same time. And ewness premiums will be lost when they turn over. How many more people live here? How much demand is there/ was there ever? So yes. They are exposed more than most SF sectors, particularly the mediocre ones. Not for the reasons you get into tho.

  63. Ice I say word on the street as I prefer not to give source names – sorry.
    “If it is true that buyers in these buildings put down sizable down payments, then they have even less to spend on their monthly payment”
    Not always true and that is where appropriate Debt to Income levels play in. Sure in the past exotic fin has played a role in distorting what that number is, but not so much the past year in my opin.
    “Finally, the real credit crunch is fairly recent”
    Nope. I have to disagree. I went in contract in 2007, building was not ready to move in until 2008 and I did not close until summer 2008 but the banks had all ready set some pretty tight requirements from the get go (day of contract 2007) almost as if they had a leg up on what was to come.
    Your second post – completely agree. Catch is I don’t play the market, prefer to play it safe so holding RE works for me. I have done just fine with the buy low sell high theory although I don’t try to time precise low or high. I may have to wait longer with some properties depending on economics but that is why I only buy places I love to live in and that could be easily rented out while still making the mortgage payment. At the same time I don’t get emotionally attached to the place either.

  64. In addition, buildings like these tend to attract a younger demographic, who tend to have less savings, and these buildings are so grossly overpriced when compared with average incomes in San Francisco, that very few people can afford traditional loans for these units.
    Not to judge by the people in the Infinity HOA meetings or the gym. I’d say it’s about 50% older people, 30% professionals (doctors, lawyers) then other. Not sure where you get your info, but even as a guesstimate it’s off.

  65. fluj,
    My comment about mortgages wasn’t only about neg-am ARMs, but your point is taken that it is unusual for someone to put in a large down payment on an ARM.
    As for the success of long-term buyers, I guess it depends on your definition of “pan out”. If an apartment is to be treated at all like an investment, then having it be worth slightly more in 10 years isn’t a good measure of success, especially when you could have bought it in the intervening yearsfor less and other investments would have turned out better.

  66. Fluj if I am understanding your post correctly – exactly, agreed; all I was trying to say.
    Unfortunately I am sure there may be some that put a big chunk of money down on ARM’s and neg-ams but wow that would be pretty insane and frankly very stupid for any bank to allow in the past year.
    Also anyone who buys new should know they will lose the “newness” value, can’t agree more. I was willing to pay for that and do every time I buy.

  67. ” If an apartment is to be treated at all like an investment, then having it be worth slightly more in 10 years isn’t a good measure of success”
    Agreed for the most part, but if it is a persons primary residence and they don’t make risky investments it works out fine enough.

  68. “but if it is a persons primary residence and they don’t make risky investments it works out fine enough.”
    I agree. I wouldn’t personally buy into a market that I thought was going to fall a lot (like I personally think SF will), but only because I’d rather wait and get the same place for less money, leaving more savings to invest/spend in other places.
    I tend to view housing as a place to live and not an investment, although there can be no arguing that throughout this decade, it has been a very good investment indeed, assuming investors sold when they could still get a high value.

  69. “I wouldn’t personally buy into a market that I thought was going to fall a lot (like I personally think SF will), but only because I’d rather wait and get the same place for less money, leaving more savings to invest/spend in other places.”
    Completely agree but had no choice but to buy before the real bottom; it was the exact place I wanted and I had other personal+financial reasons forcing me to make the call.
    It may take longer this time around but there will be a time again where one has the opportunity to sell high; of course the definition of high is a matter of personal opin.

  70. “How else can people make the payments? I make over $400K and wouldn’t stretch myself on a 30yr fixed with a 1million dollar mtg”
    With that question you have perfectly demonstrated why the SF housing market is totally out of line with economic fundamentals. These price levels are only possible with a combination of extremely lax lending from banks (gone) and the public hysteria/euphoria associated with the idea that real estate will go up for ever and is a surefire way to make money and that people will get priced out of they don’t buy (also gone).
    Current prices are clearly unsustainable and they will drop.

  71. 1 mil mortgages are not a good idea. How do people do it – they remain patient. Coming from a small town out of SF you save sometimes for 10 years if it takes that, every cent you can and than you splurge. People do it.
    Most of NYC rents these days but I have friends who bought years ago in so so areas of Manhattan, have held the prop for years and are now sitting very, very well. Is it possible that SF is just growing up to be the larger city some want yet some hate.

  72. Yeah same story everywhere but eventually it will go back up. Point of what I was saying is that the friend I mention bought back in the 80’s/early 90’s in a place not yet developed as it is now, when everyone thought they were crazy… and now regardless of the drop she is still up big time. Why because she bought a home, not to flip, was smart about financing, did not buy in over her head, and did not buy the best unit on the best block but had the gut instinct and smarts to guess the area was up and coming
    and did not worry about timing the market perfectly.
    Look, we are just back to basic fundamentals, we have all been either spoiled, smart, stupid, or pulled into a Ponzi depending on the individual situation these past years. People who are willing to gamble when the odds seem too good to be true must know they are taking a risk they may lose just as big.

  73. fluj, I usually feel bad for all the flak you get on this site but I don’t agree that once we hit bottom, these SOMA condos will be the hardest hit.
    from every study that’s recently been done, people actually want to live in the city. these condos appeal to empty nesters, new families, young professionals and the new wave hipsters who have cash but don’t want to live in the Mission anymore.
    I do agree that some of these buildings will do better long term than others but that’s another discussion.
    Yes Infinity and One Rincon will one day be the cream of the cop in San Francisco. I doubt people want to move South/West in the City and the younger Marina Crowd is already invading South Beach. You might not see the appeal now, but you will in some time.
    You can’t time the market. You can’t live in the future, so why don’t you slow down and live life today?

  74. Don’t worry about it, t. And I didn’t say condos will be “hardest hit” en toto. (That begins and ends with Bayview, Oceanview, Ingleside, etc. Although a 250% runup followed by 60% downturn, from 250K, is still quite a nice six year gain for the longterm holders.) It’s just a pet theory I have. For condos, I look at the sheer volume of condos that have been built in the last four years versus the population increase, and I simply do not see the demand. But you seemingly agree with me that 1)people are coming into cities more and more and 2)the mediocre condo builds will fare worse.

  75. “Although a 250% runup followed by 60% downturn, from 250K, is still quite a nice six year gain for the longterm holders.”
    Just a mathematical point to remember:
    100 going to 200 is a 100% gain
    200 going to 100 is a 50% loss
    There’s an asymmetry in the definition of percentages.

  76. “I agree that luxury condos will be hardest hit, tho. There’s a newness premium that will be lost. There’s also the fact that so many were built. And yeah, how expensive they are.”
    -fluj
    “Don’t worry about it, t. And I didn’t say condos will be “hardest hit” en toto. (That begins and ends with Bayview, Oceanview, Ingleside, etc.”
    -fluj
    Which one is it, fluj?

  77. You clipped some language out of complete context. But at least you included “en toto.” Point being from now on? Or, so far? Future predictions versus what has transpired to date. I think that the middling “luxury” condo builds will probably take it on the chin in the days to come.

  78. “1 mil mortgages are not a good idea. How do people do it – they remain patient. Coming from a small town out of SF you save sometimes for 10 years if it takes that, every cent you can and than you splurge. People do it.”
    These are the people I feel worst about. Those who either spent every last dollar of savings or traded up whatever equity they had in an affordable home, for a beautiful box on Rincon Hill. It is hard to watch that hard earned money disappear (with leverage).
    Quick story: a friend from Chicago was visiting and I showed him the Infinity website and how beautiful the condos were. I then told him the price tag….He then proceeded to show me almost the exact same thing in Chicago (high rise on Lake Michigan with wall-to-wall windows, hardwoods, open floor plan gourmet kitchen, 2BR, 2BA) for 320K….
    The purchase of real estate should not wipe out your life savings, or teeter you on the bankruptcy edge. It is simply a home to live in, and if its cheaper to rent, then rent. If its in the same ballpark to buy, then buy. But don’t buy if the price of buying is somwhere in McCovey cove (i.e. not in the ballpark) because of some romantic dream of owning in the city.
    IMO…we used up 15 years of appreciation in 5 years. We will be either flat for 10 years or down substantially for a few and then start slowly rising again with Obamaflation.

  79. “These are the people I feel worst about. Those who either spent every last dollar of savings or traded up whatever equity they had in an affordable home, for a beautiful box on Rincon Hill. It is hard to watch that hard earned money disappear (with leverage). ”
    Who said anything about spending every last dollar of savings or trading up from an affordable home? Actually it is you that are in a box because you sure cant think outside of one. Do you know me or my status; no, did not think so. It is not fair of you to make assumptions. My situation is in fact no where near what you assume. For your info I rented for 11 years. I could have bought a place like this prior to now but did not want to nor was it financially prudent of me. I could care less about Chicago because I dont live there and would never want to. The time was right for me to buy recently which really compared to buying the past handful of years ends up being a pretty good window of opportunity. I paid what I thought was fair, and got exactly what I wanted, my montly payments with a 30yr fixed are less than what they would be if I rented what I have or I would have waited longer.
    Oh and by the way I do plan on being here for 10 years at min. so by your standards I should be just fine.

  80. “You can’t time the market.”
    and yet you don’t plant corn in the fall.
    “You can’t live in the future”
    and yet you will … one day … if you’re lucky. So it’s worth sparing a thought for it from time to time.

  81. GoWithTheFlow –
    Not sure why you are getting defensive; my comments are not meant to be disparaging.
    The gist of my argument is that it is important to be patient and thoughtful when it comes to real estate (both in up and down markets). Being Infinity resident #1 is not the same as being Google employee #1. Whereas Google employee #1 can retire early, Infinity resident #1000 may be the one who ultimately makes out best.
    Please let us know the prices that your recently moved in neighbors (new locks) paid for their places ($$/sf)as compared to your purchase price. I am sure that data will be available publically in the next 2 months and it would be quite educational.

  82. “my montly payments with a 30yr fixed are less than what they would be if I rented what I have or I would have waited longer.”
    Also, maybe you could hash this out for us more precisely. I am assuming you put down one whopper of a down payment for this to be true. (assume $3500 rent/2BR which is fair, i think)

  83. gowiththeflow, you apparently made a good decision for yourself. This crowd is unforgiving and quite skeptical about everything, not to mention mostly negative. I read earlier where you mentioned that you loved your unit. Sometimes you find the property that just feels right for you and go with it. The stars align and you find that everything just falls in place. Granted, no one can say what the future brings, but we live right now and I for one am for living in the best home I can afford. Congratulations and enjoy your life at The Infinity.

  84. rukidding I see your trying to slice and dice my cred. I have offered the info before trying to be helpful to those researching what it takes now a day to qual for financing but will offer the info up one last time for you.
    Yes $3500 may be fair depending on the building and views. Have not checked rents lately but am guessing they have dropped the past few months.
    In my case I would est. higher; for one I have a fairly large 3bd. To compare quality, I rented at the Paramount 7 years a go, 1 bed/1 bath est. 720sf, floor 30, full pano bay and city views for $2800 a month, almost 3k after 6mo. and no rent control. This is similar to the types of places I have always rented. Let’s not worry about factoring in my views or extra outdoor sf. because I am happy to offer info but not pin point where I actually live.
    Fin Req. were LTV 75%, DTI around 35%, min. 6 mo. reserves. Originally in 2007 20% was req. by the developer and bank, it jumped to 25% in 2008.
    This is no different than what should have been required all a long.
    Thanks viewlover! Yes you are correct with all you state. Best to you in your place as well.
    I don’t take posts personal, this site is always harsh and negative but it’s honest and I like that. It does seem to be a bit more negative in the past few months so may unplug until Feb and just enjoy my place.

  85. “Not sure why you are getting defensive; my comments are not meant to be disparaging.”
    Sorry if it is coming across that way, that is not my intent. I don’t feel your comments are disparaging; I tend to just respond matter of fact..ok maybe the in the box comment was not fair on my end and I am sorry about that.
    “Please let us know the prices that your recently moved in neighbors (new locks) paid for their places ($$/sf)as compared to your purchase price. I am sure that data will be available publically in the next 2 months and it would be quite educational.”
    Now this would be good info. I actually have no idea at this time; it sure would be educational.
    I did not use a realtor so I have about a bit of a buffer if there were any drops.

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