December 31, 2009
Another Market Metric And Food For Thought At The End Of The Year
Eleven months ago Paragon Real Estate attempted to define the decline from peak for 12 segments in San Francisco. Based on a comparison of average dollars per square foot for sales at "peak" versus an average of sales from 10/15/08 to 1/30/09, Paragon concluded that declines to date in February had ranged from 6 percent for single-family homes in the Richmond to 25 percent for single-family homes in Bayview/Excelsior.
In between were single-family homes in Noe/Eureka Valley (down 10 percent at the time) and condos in Hayes Valley/Alamo Square/NOPA (down 11 percent at the time).
In November Paragon repeated their analysis but changed to 18 segments. As a plugged-in reader noted last month, Paragon’s declines from peak to November (actually averages for sales from May to October) ranged from 9 percent for Pacific Heights/Marina condos to 45 percent for single-family homes in Bayview (no longer combined with Excelsior).
The decline from peak for single-family homes in Noe/Eureka Valley fell to 21 percent while the decline for condos in Hayes Valley/Alamo Square/NOPA fell to 18 percent.
And while the average price per square foot decline from peak to November for single-family homes in the much maligned District 10 averaged 35 percent, the average decline from peak for single-family homes elsewhere in San Francisco averaged 17 percent. The average decline for condos? 17 percent.
According to Paragon's analysis, peaks for each area ranged from the first half of 2006 (bottom end of the market) to the first half of 2008 (top end of the market), with the majority in 2007 or before. As we wrote in 2006, "Get ready for what we’re going to call a real estate 'flight to quality'." And nobody that’s plugged-in should have been caught by surprise.
Keep in mind a comparison of average selling prices per square foot is far from perfect especially when painting with such broad brush strokes. We can’t vouch for Paragon’s methodology or results. And as Paragon correctly noted in February (but not in November), price per square foot comparisons in a down market tend to understate actual declines in no small part due to changes in mix (might "beauty pageant effect" sound familiar?).
All in all it’s just another metric to consider, some extra context for our apples (think drops from pre-2006 values), and food for thought and reflection at the end of the year.
Paragon's November numbers (verus peak and "April") for all eighteen (18):
Changes in Average Dollar per Square Foot Values from estimated peaks to "November" (5/09-10/09) for Selected San Francisco Neighborhoods & Property Types (and changes from "April" (10/08-3/09) when available):
Decline from an estimated peak in the first half of 2006:
Bayview SFR -45% (down 5% from "April" 2009)
Excelsior/Portola SFR -25% (-1.5%)
Ingleside/Heights/Oceanview SFR -23% (-1%)
Decline from an estimated peak in the first half of 2007:
Mission (Inner) Condo -20%
Sunset (Central/Outer) SFR -20% (-6%)
SOMA Condo -18% (+2%)
Miraloma/Sunnyside SFR -19% (-8%)
Saint Francis Wood/West Portal/Forest Hill SFR -15%
Richmond (Central/Outer) SFR -14%
Potrero Hill SFR -14%
Decline from an estimated peak in the first half of 2008:
Noe & Eureka Valley SFR -21% (-6%)
Noe & Eureka Valley Condo -18% (-9%)
Hayes Valley/Alamo/NOPA Condo -18% (-7%)
South Beach Condos -18% (-6%)
Bernal Heights SFR -13% (+2%)
Russian/Nob/Telegraph Hill Condo -13%
Pacific Heights/Marina Condo -9% (-4%)
Most Expensive ($1.5-4.0M) North Houses -18%
∙ How Much Have San Francisco Home Values Declined Since their Peak? [Paragon 2/09]
∙ How Much Have San Francisco Home Values Declined Since their Peak? [Paragon 11/09]
∙ Still Defying Gravity At Glen Park Market Place? [SocketSite]
A "Rebirth" For 2290 (Green) As Father Time Closes Out 2009
Listed for $1,900,000 in March 2008, the sale of 2290 Green closed escrow four months later with a "confidential" sale price reported at $1,900,000 on the MLS (public records, however, peg the actual sale price at $1,775,000). From the listing at the time:
2 family dwelling & 3 guest rooms per 3R report but listed as 5 units per tax records. Nice Victorian details in main building which is configured with two vacant owners units on the upper level and two units below, with the rear unit vacant.
Renovated and "Reborn" over the past seventeen (17) months, the property is back on the market as a single-family home with one-bedroom in-law. Asking $4,325,000.
UPDATE (1/4): Ask and ye shall receive (sometimes). Additional photography for 2290 Green have been added to the listing.
The address, however, is currenlty "undisclosed" (once again, unless you're plugged-in).
New U.S. Jobless Claims Dip But Extended Benefits Jump In December
"Initial jobless claims fell by 22,000 to 432,000 in the week ended Dec. 26, the lowest level since July 2008, Labor Department figures showed today in Washington. The number of people receiving unemployment insurance fell [by 57,000] in the prior week to 4.98 million [but] those receiving extended benefits jumped [by 199,000 to 4.82 million]."
∙ U.S. Jobless Claims Drop to Lowest Level Since 2008 [Bloomberg]
December 30, 2009
A Quick Short(er) Sale And Key Word: Pre-Approved
As we wrote last month:
Listed as a short sale for $595,000, the Lower Pacific Heights single-family (but zoned RH2) home at 2874 Bush Street sold for $675,000 in June of 2003.
According to a plugged-in source a short sale has already been approved (although at exactly what price was unknown), and while most definitely a fixer (if not a gut and build), it could possibly be perfectly habitable with a bit of elbow grease.
And while the short sale of 2874 Bush Street closed escrow on 12/22/09 with what appears to be a "confidential" sale price on the MLS (and will be considered to be $595,000 with respect to industry reports), a bit of digging and calculating reveals the actual sale price to be $550,000 (18.5% under its 2003 contract price).
Key word in the listing: pre-approved. No word on any credits for the furnace.
Back To Year 2000 Rent For The 3,300 Square Foot 75 Folsom #1204
Purchased for $4,125,000 in September 2000, the 3,300+ square foot 75 Folsom #1204 was unable to find a buyer at $4,400,000 (down from $6,200,000) in 2009.
And while a plugged-in agent reacalls having leased it out for the owner in 1999 at $10K per month (asking $12K at the time), a plugged-in tipster notes the current owners are now asking $9,500 per month down from $12,000-$15,000 per month this past August.
∙ From Three To One And Six-ish To Five-ish (So Far): 75 Folsom #1204 [SocketSite]
∙ $9500 / 2br - Enjoy Panoramic views - two bedroom condo [Craigslist]
Playing Chicken With A Five Year Arm (It’s Not Just About Rates)
I’m caught in the mortgage crisis by association. I took a 5 year arm mortgage with a balloon payment thinking I could re-finance. There are no loans today for Showman with non-conforming warehouses. So it goes on the block. Hell, I’ll even finance it…
And as a plugged-in tipster added last week:
Although it's his home, he's made it into a funky hangout space for the local arts community... it will be sad to see it fall into the hands of more sensible property owners, but such is the way of the world.
Or perhaps not. A follow up from from Chicken John yesterday:
I talked to a loan guy today that may be able to do something. I only owe like $220,000. It's not *that* much. It's all phony money to me. I've got like $60 in my pocket. It's comedy, really...
∙ Listing: 3359 Cesar Chavez (1/1) 2,800 sqft - $899,000 [MLS]
∙ Chicken John Is Selling His Legendary San Francisco Warehouse [Laughing Squid]
December 29, 2009
Moving On Out (And Closing Out Down) At 3016 Pine
As a plugged-in tipster catches the moving trucks in action this morning, the sale of 3016 Pine Street closes escrow this afternoon with a reported contract price of $2,260,000.
Although originally listed for 13 percent more eight months ago, according to industry statistics the sale will be recorded at 4 percent under its last asking price of $2,350,000 and with 104 days on the market for the single-family Lower Pacific Heights house.
And at $2,260,000 it’s an apples to apples sale at 17 percent under its July 2006 purchase price of $2,725,000 for the completely remodeled District 6 home.
∙ An Apple Rather Than Cone On The Pine Street Tree (3016 Pine) [SocketSite]
∙ A Potentially Bitter Apple In Lower Pacific Heights: 3016 Pine Returns [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
Rocking An Earthquake Cottage With Interior Design: 64 Russell
64 Russell isn’t your typical earthquake cottage any longer. Purchased for $725,000 in July 2003, the 1908 cottage was gutted and then redesigned by interior designer April Sheldon.
The line of the listing: "Belle Époque Urban Cottage." And while the address on the MLS might be "undisclosed," it’s not if you’re plugged-in. Currently asking $1,575,000.
∙ Listing: 64 Russell (2/2) - $1,575,000 [MLS]
"Best Price Ever" At 310 Townsend (Assuming It’s Approved)
Listed for $799,000 plus $25,000 for parking in February 2007, 310 Townsend #202 sold for $824,000 in March of that year. And now the 945 square foot one-bedroom is back on the MLS as a short sale with a list price of "$450,000" (a drop of 45 percent).
While the listing touts "best price ever," however, it is missing "bank approved price."
October Case-Shiller: Up For SF MSA Houses, Down For Condos
According to the October 2009 S&P/Case-Shiller Home Price Index, single-family home prices in the San Francisco MSA gained 1.2% from September ’09 to October '09, down 2.6% year-over-year and down 37.8% from a peak in May 2006, but up from a 46.1% fall from peak as recorded in March 2009.
For the broader 10-City composite (CSXR), home values gained a nominal 0.1% from September to October and remain down 29.8% from a peak in June 2006 (down 6.4% year-over-year).
"The turn-around in home prices seen in the Spring and Summer has faded with only seven of the 20 cities seeing month-to-month gains, although all 20 continue to show improvements on a year-over-year basis. All in all, this report should be described as flat." says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s.
"Coming after a series of solid gains, these data are likely to spark worries that home prices are about to take a second dip. Before jumping to conclusions, recognize that the one time that happened at the beginning of the 1980s, Fed policy saw dramatic reversals, which is very different from the stable and consistent Fed policy we have today. Further, sales of existing homes – those included in the S&P/Case-Shiller Home Price Indices – have been very strong in recent months, working off the inventories of houses for sale. At the same time, housing starts remain weak, fears that the market will be swamped by a wave of foreclosures are heard and government programs aimed at the housing market will expire in the first half of 2010."
On a month-over-month basis and having skipped September, San Francisco MSA single-family home prices rose across all three price tiers for the fourth time since May 2006.
The bottom third (under $317,792 at the time of acquisition) gained 1.0% from September to October (down 11.9% YOY); the middle third gained 1.9% from September to October (down 3.5% YOY); and the top third (over $591,888 at the time of acquisition) gained 0.8% from September to October (down 8.3% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA remain at June 2000 levels having fallen 58% from a peak in August 2006, the middle third is hovering around June 2002 levels having fallen 36% from a peak in May 2006, and the top third is back to March 2004 levels having fallen 24% from a peak in August 2007.
Condo values in the San Francisco MSA fell 0.3% from September ’09 to October '09, down 9.7% on a year-over-year basis and down 27.6% from an October 2005 high.
Our standard SocketSite S&P/Case-Shiller footnote: The S&P/Case-Shiller home price indices include San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., greater MSA) and are imperfect in factoring out changes in property values due to improvements versus appreciation (although they try their best).
∙ Home Prices Still Improving but at a Moderating Pace [S&P]
∙ September Case-Shiller: Bottom Tiers Up But Flat At Top For SF MSA [SocketSite]
∙ A Sprinter's Or Marathoner's Pace? [SocketSite]
∙ Are The Real San Francisco Foreclosures On Their Way? [SocketSite]
December 28, 2009
Pair Trio Of Bank-Owned Penthouses Atop The Watermark
As we wrote in April:
Two months after its initial sale for $1,250,000 in October of 2006 Watermark (501 Beale) Penthouse #2B was flipped for $1,375,000. (Ah, the good old days.) It's now a little over two years later and the top floor condo is back on the market and asking $1,094,500.
The listing notes both short sale and bank owned (we believe it’s the former) and the condo failed to sell earlier this year when seeking $1,195,000. Keep in mind that the identical "penthouse" unit a floor below (#PH1B) sold for $1,300,000 in October of 2006 and was likely a supporting comp for the flip of #PH2B. And so on. And so forth.
501 Beale #PH2B ended up selling for $950,000 this past October. That same month 501 Beale #PH1B was returned to the bank, it's now back on the market and asking $940,500.
Plugged-in people should have seen it coming (and been prepared). Those too busy whining about our "unfair apples" probably would have missed it (or perhaps were simply trying to sell you something else).
∙ Listing: 501 Beale #PH1B (2/2) - $940,500 [Redfin]
∙ From Flippy To Floppy For Watermark (501 Beale) Penthouse #2B [SocketSite]
∙ A Pair Of Bank-Owned Penthouses Atop The Watermark (501 Beale) [SocketSite]
∙ Another Bank Owned Watermark Comp To Be: 501 Beale #6C [SocketSite]
The One With The Twelve On It: 2849 Pacific Price-ish Scoop
Okay, so perhaps the sale price for 2849 Pacific won’t be at its asking of $14,000,000. But according to a plugged-in tipster the "price will provide encouragement for sellers of large, good condition, D7 properties" and starts with a twelve (12).
No word on how much said encouragement assumes said sale isn’t one of the last "confidential" sales of the year. We'll keep you plugged-in.
∙ Cleaned Up And Coming Soon: 2849 Pacific [SocketSite]
∙ 2849 Pacific: A Million Dollar (Double) "Take" [SocketSite]
∙ An End To Confidential MLS Sales* (*Unless You're Willing To Pay) [SocketSite]
214 Arguello: Two Years Later And Asking Twenty-Five Percent Less
No, we weren’t kidding when we noted "coming soon" for 214 Arguello. Once again, last sold for $1,600,000 in December 2007, unable to find a buyer at an "unbelievable" $1,395,000 in 2008, and taken back by the bank three weeks ago with no bidders on the courthouse steps at $1,259,306.
Now listed and asking $1,200,000 at the end of 2009.
∙ Listing: 214 Arguello (3/2.5) - $1,200,000 [MLS]
∙ An Absolutely Unbelievable Foreclosure As Well? (And Coming Soon) [SocketSite]
∙ Perhaps It’s The Market That’s More Unbelievable To Some... [SocketSite]
From Bulk(y) To Lien For Citadine At 1299 Bush
As we reported four weeks ago, the developers of The Citadine (1299 Bush) are seeking as bulk sale of the entire building. As we add today, at least five mechanics liens totaling over $2.5 million have been filed against the development over the past month.
∙ The Citadine (1299 Bush) Scoop: Seeking A Bulk Sale Of The Building [SocketSite]
∙ Citadine (1299 Bush): Current Pricing And A Peek Inside [SocketSite]
∙ Citadine Cuts Between Four And Ten Percent For Listed Condos [SocketSite]
December 23, 2009
Twas The Day Before Christmas And On The Courthouse Steps…
Its 7,531 square foot oversized corner lot along Marina Boulevard makes it hard to miss. And we’ve always been rather keen on the 4,170 square foot four-bedroom home as well.
Purchased for $2,800,000 in 2001 and refinanced in 2002 with a $1,800,000 note, 485 Marina Boulevard was scheduled to hit the courthouse steps on 12/24 with $1,848,366.41 owed on said loan. At least it was the last time we checked.
And although we’d be surprised if it actually goes to auction tomorrow, consider it an early Christmas present if it does and you’re plugged-in and prepared.
We’ll see you next week to wrap up the year.
UPDATE: As expected, it appears as though any auction has indeed been postponed until 2010. And perhaps that first isn’t all that’s owed. Cheers.
U.S. New Home Sales Pace Slows 11 Percent In November
While the pace of existing home sales in the U.S. quickened in November, the pace of new home sales fell 11 percent from October.
"The tax credit put a Band-Aid over the housing problem and in October and November we ripped it off" as it was set to expire, said Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina, who projected sales would fall. "Demand for housing is not likely to pick up on a consistent basis until we start to see some improvement in employment."
Think foreclosures when trying to rationalize the divergence in pace between existing and new home sales.
∙ A Sprinter's Or Marathoner's Pace? [SocketSite]
∙ Sales of U.S. New Homes Unexpectedly Fell in November [Bloomberg]
An Absolutely Unbelievable Foreclosure As Well? (And Coming Soon)
As we wrote about 214 Arguello Boulevard a year ago and almost to the day:
Purchased for $1,600,000 [in December 2007] when they were asking $1,675,000, 214 Arguello Boulevard returned to the market nine months later (September 2008) asking $1,595,000. The list price was lowered to $1,495,000 six weeks later. And for the past three they've been asking $1,395,000.
A sale at the current asking for this four bedroom, two and one-half bath, completely renovated and District 7 (albeit on a busy block, as it was before) condo would represent depreciation of 12.8% over the past year.
From the listing: "This price is [absolutely] unbelievable…" Only if you're not plugged-in.
December 22, 2009
Landmark Bourn Mansion (2550 Webster) Bankruptcy Sale Approved
...[they] had to find a trustee for Chapter 11 so all previous bids were thrown out. Now the trustee has ratified an offer and an overbid schedule has been made, so now the overbid and sale approval will take place on December 22. Overbidders must have offers in by no later than December 17, 2009 at 4:00 pm and the first minimum overbid has to be $2,550,000 (the list price is $2,900,000).
As a plugged-in source reports today:
The sale of the house was approved this morning. The motion to dismiss was denied.
UPDATE: The approved sale price: $2,790,000.
∙ The Bourn
Foreclosure Bankruptcy And Bidding Scoop [SocketSite]
∙ The "Plugged-In(side) Scoop" And Candid Peek Inside: 2550 Webster [SocketSite]
∙ Landmark Bourn Mansion (2550 Webster) Listed And Your Peek Inside [SocketSite]
∙ Bourn To
Run Party: A San Francisco Mansion Of Ex-Glory And Dreams [SocketSite]
∙ The Bourn Foreclosure (2550 Webster) [SocketSite]
Not So Lucky Number Eights (Maybe The Nines Will Be Better)
Purchased for $562,000 in April 2004 but then "completely renovated [with] extensive high quality and designer touches throughout this charming house," 6521 California returned to the market just three months later asking $888,000. It closed escrow in August 2004 with an MLS reported sale price of $938,888.
According to public records the buyers of the house in 2004 financed the purchase with two variable rate loans totaling $938,850. And according to its latest listing, the "Sea Cliff" house is now bank owned and asking $799,900 (but subject to tenant rights).
Apparently $38 isn’t enough skin to keep a buyer in the game.
UPDATE: With respect to how the San Francisco Association of Realtors defines Sea Cliff:
∙ Listing: 6521 California (2/2 + 1/1) 1,474 sqft - $799,900 [MLS] [Map]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
A Sprinter's Or Marathoner's Pace?
"[U.S. existing home] purchases increased 7.4 percent to a 6.54 million annual rate from a revised 6.09 million pace the prior month, the National Association of Realtors said today in Washington. The median sales price declined 4.3 percent from the same month a year earlier, the smallest decrease since November 2007.
Lower interest rates, cheaper homes and a homebuyer tax credit have resuscitated a housing market that contributed to the worst economic slump since the 1930s. A sustained recovery in housing and the economy depends on a resumption of payroll growth after employers cut 7.2 million jobs in the past two years."