CATEGORY ARCHIVE: SocketSite Readers Report
May 12, 2008
Not Only Appliances, But A Shower Door And Some Light Fixtures Too
A plugged-in tipster reports back on the bank owned condo in the Beacon that we pointed out ten days ago (260 King #957).
...3 offers...the [foreclosed upon] seller had stripped everything out of it before leaving...even the shower glass door, light fixtures, power cover outlets, all appliances!
No word on the accepted contract price but we’ll let you know as soon as it closes (as you might recall, it was listed at $644,900 despite having previously sold for around $860,000). And if a plugged-in reader happens to be the buyer, let's not forget those invitations to the housewarming.
∙ Bank Owned (With Big Windows) At The Beacon: 260 King #957 [SocketSite]
Posted by socketadmin at 6:49 AM | Permalink | Comments (20) | (email story)
May 8, 2008
Not Exactly Cheap, But A Bit Below Their Initial Great Expectations
Granted, it was officially listed at just over 4,000 square feet (but according to one appraiser, is closer to 5,000); and it does offer an in-law unit, six parking spaces, and some fine woodwork (all in a package fit for Miss Havisham).
But the initial list price of $3,000,000 for 2645 Lincoln Way in Parkway Terrace (central Sunset) still managed to shock quite a few (and likely sent the neighbors into a frenzy). And while the asking price on the home was subsequently reduced down to $2,375,000, according to a plugged-in tipster it just closed (or is about to close) escrow for $1,900,000.
Posted by socketadmin at 7:00 AM | Permalink | Comments (8) | (email story)
May 5, 2008
Reader’s Reports: Homes On Esprit Park Now Starting From $549,000
A plugged-in reader in the market for a home at Homes on Esprit Park receives an email from the sales office alluding to some new pricing (“can't release the pricing via email”) with a request to call.
I just spoke with them, and found that some 855 SqF units have just been released for $549k, well under the $600k they were asking for similars across the courtyard just a few weeks ago when I went on a hard hat tour of the site.
Interested parties (and price guarantee holders) take note (or action).
∙ 900 Minnesota: Now And Then [SocketSite]
∙ Homes On Esprit Park: The Foreshadowing Comes To Fruition [SocketSite]
∙ A Price Guarantee From (And Proof Of Price Reductions At) Esprit Park [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (6) | (email story)
May 2, 2008
What Happens When Expectations Don’t Match The Market? (Redux)
As with stories, their are two sides/perspectives to every (potential) transaction. You've heard from one (the seller), now here's the other:
Ok, so I’m the buyer in question (someone I’m acquainted with forwarded me a link to this discussion).
First, I’d like to say that I’m quite sympathetic to the seller. We considered not making an offer at all since they appear to have bought pretty much at the peak of the San Francisco housing market, we even told the seller’s realtor that we would consider dual agency to try and soften the blow (so they could hopefully reduce their commission). However you have to understand that we don’t want to find ourselves in the same situation as the current seller as prices continue to fall in San Francisco over the next couple of years.
The public records on this loft at Hoff say it has 954 square feet. A 2 bedroom, 2 full bath, top floor loft at 17th and Bryant with 1126 square feet just sold for $15,000 less than what the seller wants for this unit, and that is in a significantly safer part of the Mission.
We’re already concerned that in a year it will be worth substantially less than what we offered. I’m sorry if our offer offended anybody, we will just go look at other places – we’re not in a rush. If someone bought a few years before the peak it might be less painful to deal with today's prices.
The topic might be uncomfortable - or even unfathomable - to some, but it's a healthy and highly relevant discussion, and we thank both sides for opening up. All comments on the original thread in order to maintain the flow.
∙ What Happens When Expectations Don’t Match The Market? [SocketSite]
Posted by socketadmin at 2:00 PM | Permalink | (email story)
May 1, 2008
What Happens When Expectations Don’t Match The Market?
A plugged-in reader writes to vent:
I’m selling a Loft [in the Mission]. We just dropped our price 20K and got an offer over the weekend for 89K UNDER our new lower offering price. Are you kidding me?! Is this really what people are thinking they can get away with? Now I guess I’m lucky – because this apartment doesn’t HAVE to sell, I just WANT to sell it. So I told the people that made the offer to – well, you can guess what I told them.
Personally, I am shocked that it hasn’t sold for asking. It’s a fun, happening area, and that’s the kind of apartment it is – I guess people don’t buy fun when the market is like this. *Sigh*
As far as we’re concerned, it’s an anecdote about managing expectations of buyers and sellers alike. (And to be honest, the “Motivated Seller!” language in the listing might not be helping with either.)
UPDATE (5/2): And the offering party weighs in with his perspective.
Posted by socketadmin at 11:00 AM | Permalink | Comments (90) | (email story)
April 30, 2008
A Plugged-In Reader's Report: Crime Starts Hitting Closer To Home
I was in Baretta restaurant on 23rd and Valencia last night while it was robbed at gunpoint. The gunman had us all lie on the floor and look down. He proceeded to rob the till. Very scary stuff. I know of a recent home invasion on North Potrero. A friend of mine had his wife's laptop stolen while he was in the shower in his own home in Noe Valley. Then there's the rash of muggings in Bernal and Glen Park. I saw a guy roll up on another guy and then get shot at by the driver of the car he meant to himself assail two weeks ago on the corner of Cesar Chavez and South Van Ness. They sped off down Cesar Chavez street at 100 mph. One of the kids who was killed by that asshole over pizza in the Sunset lived in a friend of mine's building. He was shot in the face. The killer remains at large because his girlfriend wouldn't i.d. him. That was the best they could come up with. San Francisco needs to step up the policing. It's getting ridiculous.
And ads: "[T]hat octopus risotto [at Baretta] is awesome."
UPDATE (5/2): "My neighbor in Ashbury Heights was mugged at gun point last night at 10:00, half a block from her house. We're all very shaken."
∙ High Crime Rates Are One Thing, Random Muggings Quite Another [SocketSite]
Posted by socketadmin at 1:58 PM | Permalink | Comments (105) | (email story)
April 28, 2008
The SocketSite Scoop On One (1) Ecker Place: Going Condo Rental
From a plugged-in tipster:
One Ecker is going the route of Apartments. After pre-selling 10 of 51 units, the building refunded deposits and is going to rent instead of sell.
No word on the proposed rents nor whether or not the official explanation will be unexpected strength in the rental market (versus unexpected weakness in demand for the condos).
∙ One (1) Ecker Place Update: Sales Office Open (And A Few Details) [SocketSite]
∙ A Heller Manus Renovation Of 1 Ecker Place [SocketSite]
Posted by socketadmin at 9:31 AM | Permalink | Comments (28) | (email story)
April 21, 2008
A Plugged-In Reader Reports: Mission Valencia Reduction/Impression
Initially priced at $659,000 as part of “Valencia Triangle” (subsequently reduced to $585,000), and then initially priced at $599,000 as part of “Mission Valencia,” a plugged-in reader notes that 3184 Mission Street #302 is now on the market for $549,000 and offers some thoughts and impressions.
I wanted to post my recent impressions of Mission Valencia since some of the only info I could find about the place came [from this site]. I saw several of the units at an open house last week and was most interested in #302, which is currently on the market for $549K (reduced price) with 2 yrs paid HOA. This is one of the smaller, cheaper units.
The unit was very nice and new with a great kitchen and living room. However, the bedrooms were tiny and the bathroom layout seemed odd with the washer/ dryer taking up a lot of the space. The unit also overlooks busy Mission St. and the BART grates, and when the trains went by (which is very often) it was quite loud. There was almost no storage space in the unit, just small closets in the bedrooms. I did not see evidence of the pigeon problem that I had read about [here], but there was a fake owl on the balcony. The balcony was really small and not very usable--I would've rather had storage space.
You have to make your own decision about the neighborhood and how safe you feel there, so I won't go into that. The parking is secured and overall the building seemed secure. You can walk to 24th St. BART and there is bus service on Mission right outside the building. But other than the bars and restaurants in the immediate vicinity of the building, I don't think you'd be able to walk to very many fun places (Noe Valley, Bernal Heights) very easily. But they would be a short drive/trip away.
Overall, the building is nice and new, but the unit still seemed overpriced for what you get even with the incentives and price reductions. However, if you are looking in this price range, it is one of the nicer things I have seen for below 600K. If the price comes down another 50K, I think it would be a great buy. Hopefully, this will help someone out there.
UPDATE: And from another: "Word is that they are really willing to negotiate on these prices. For those interested in 2BR 2BA 1Pkg, it's probably difficult to find a better deal. I think you could get most of the units for 10% less than the listed price, which is already reduced. And don't be bamboozled by the realtor telling you only a few are for sale- they're all for sale. I think only the 2BMR units closed and one unit is in contract. This project has been a financial disaster for the builder as a result of having the condo approvals pulled in spring 2006."
∙ Listing: 3184 Mission #302 (2/1.5) - $549,000 [MLS]
∙ Take Two For Valencia Triangle Mission Valencia (3184 Mission) [SocketSite]
∙ Valencia Triangle (3184 Mission) [SocketSite]
Posted by socketadmin at 3:00 PM | Permalink | Comments (54) | (email story)
SWL 351 And The Proposed 8 Washington Street Project: Port Hearing
An update from Frederick Allardyce (President of the Barbary Coast Neighborhood Association) on the proposed development of Seawall Lot 351 (and by extension, the proposed 8 Washington Street Project):
This lot probably is the most valuable parcel (individually or by $ per square foot) not only in the Ports portfolio, but perhaps in the entire city. The success of the Port’s development of this parcel, may lead the Port into successfully developing the other [seawall] lots north of Market Street, which still have State Lands Use Zoning (which does not allow residential use). This parcel has been proposed as the central portion of a 170 unit luxury condominium project, of which many of the proposed units would sell for higher than any of the units at the Millennium ($2,000 to $3,000 per sq ft).
The Ports first hearing on this project was Monday, April 14th at which several hundred interested parties came and participated in a “neighborhood” analysis of the various possible uses” of this parcel and other parcels on the Waterfront. The SF Planning Department, which led 9 different discussion groups at the meeting found that the vast majority (some groups as high as 85%) wanted SWL 351 to remain as “Open Space and or Recreational”. Of the over 150 in attendance only 1 voted for an 84 foot tall building (which is 52% higher than the 55 ft tall Embarcadero Freeway). The vast majority wanted recreational facilities and a new bus system from the Ferry Building to the existing parking at the Alcoa Building (One Maritime Plaza) and the Embarcadero Center that could replace the possible removal of parking adjacent to the Ferry Building.
Any guesses as to the makeup of those 150 interested parties (and what "interests" they represented)?
∙ The SocketSite Scoop On The 8 Washington Street Project [SocketSite]
∙ Seawall Lot (SWL) 351 [SFGov]
∙ San Francisco Seawall Lot Rezoning Public Forum (5/14/07) [SocketSite]
∙ Millennium Tower San Francisco (301 Mission): Sales Update/Facts [SocketSite]
Posted by socketadmin at 11:27 AM | Permalink | Comments (10) | (email story)
April 7, 2008
From Foreshadowing To Foreclosure For A Marquee Loft Off Van Ness
Four months ago we called out a Craigslist ad which read:
I have a modern kitchen by Pedini for sale. With the appliance I paid apx $55,000 for it….Its current installed in my condo. It was never used….You have to take out and install it your self. Includes all the appliances….Im located in off Vanness. Send me your offers. Please no under bidders I need it. sold asap.
Last week we called out a Marquee building condo that's missing a kitchen, is touting a “motivated” seller (Merrill Lynch Mortgage Lending), and is listed for $620,000 ($245,000 less than its last open market sale eighteen months ago).
And this weekend a plugged-in reader put the pieces together (which a few others saw coming a mile away).
∙ Change Of Heart, Cash Crunch, Or A Condo Sitter Gone Crazy? [SocketSite]
∙ Another Non-Comp Comp Along The Booming Van Ness Corridor [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (31) | (email story)
April 2, 2008
A Plugged-In Reader’s Update: 55 Laguna Poised For Strong Support
“Sup. Mirkarimi, in response to my email, writes: "[T]he entire plan [for 55 Laguna] successfully emerged from the Land Use Committee on Monday. It now goes to the full Board next week where it's poised for strong support."
Since I live in the Haight, I go by the campus every day on the bus and on foot, and something about that big, blank, street-deadening wall really bugs me. So I've been following this saga pretty closely, and while it's been frustrating to watch the planning process drag on for so long, all the haggling does seem to have produced a decent project. My impression is that, as usual, Mirkarimi played a key role in bringing everyone to the table.
So I guess the lessons to be learned are twofold: (1) Elect good supervisors, and (2) Don't let the loud anti-everything minority be the only voice they hear once they're in office.”
[Editor's Note: And perhaps: (3) It pays to get plugged-in.]
∙ Supervisor Peskin Engineers An End-Run (And Ending) For 55 Laguna [SocketSite]
∙ 55 Laguna: Approved On Appeal And In Front Of San Francisco’s BOS [SocketSite]
Posted by socketadmin at 6:45 AM | Permalink | Comments (3) | (email story)
From The Emails Of Tipsters: 34 Presidio Terrace Closing Escrow
According to a seriously plugged-in tipster, the sale of 34 Presidio Terrace will close escrow this week (but no word on the contract price). A few additional factoids:
Was listed by Malin Giddins at 10.4. Has been on and off of the market a few times over the last few years.
Used to be the home of Mayor Joe Alioto, so served as the unofficial mayor's mansion of San Francisco in the 70's and 80's. Was bombed in 1975 during a union strike in SF.
Beautiful house. Over 8000 square feet. Quarter acre lot. Great entertaining house while also being a very practical family house.
Buyer was represented by Steven Mavromihalis. Steven and Malin are two of the top agents in the city, and they were successful in getting the deal done...
As always, let’s not forget those invitations to the housewarming. (And thank you for plugging in.)
∙ Listing: 34 Presidio Terrace (5/6.5) - $10,900,000 [sfproperties.com]
∙ Another Reduction In Uberexclusive Presidio Terrace [SocketSite]
∙ New Year, New Price For 34 Presidio Terrace [SocketSite]
∙ What’s Moving (Or Not) And For How Much (Or Little): Withdrawn [SocketSite]
Posted by socketadmin at 6:10 AM | Permalink | Comments (13) | (email story)
March 28, 2008
A SocketSite Reader Reports: 65 Caselli Returns With Just One DOM
As we wrote a little over two weeks ago:
The listing for 65 Caselli expired without generating a sale (as far as we know). If the seller is in fact "motivated" to sell, we wouldn't be surprised to see the properties return under a new broker. (And perhaps another new price...)
As a plugged-in Trip writes today:
I see that 65 Caselli, oft-featured here for the, um, interesting, bathroom, and significant price reductions is newly listed again. I believe it's now at an even further reduced price, and, of course, "officially" now on the market for 1 day.
And in summary: Originally listed a little over four months ago at $2,295,000, expired a few weeks ago at $1,699,000, and back on the market today at $1,649,000.
∙ Listing: 65 Caselli Avenue (3/4) - $1,649,000 [MLS]
∙ And Sometimes It’s Simply The Sinks (65 Caselli Avenue) [SocketSite]
∙ We Have A Motivated Seller! (But Still Seeking A Motivated Buyer!) [SocketSite]
Posted by socketadmin at 8:57 AM | Permalink | Comments (16) | (email story)
As Succinct As They Come: An Address, A Picture, And A Price
The entirety of the succinct (and unfortunately unconfirmed) plugged-in reader's tip: An address (2504 Scott Street), a picture (above), and a price ($14,000,000).
UPDATE: And once again, a plugged-in tipster is right on the money.
∙ Listing: 2504 Scott Street (6/6.5) - $14,000,000 [MLS]
Posted by socketadmin at 7:30 AM | Permalink | Comments (11) | (email story)
March 20, 2008
While Arterra Starts To Strip, The Hayes Starts To Close (And Open)
While Arterra starts to strip, according to a plugged-in tipster The Hayes has started closing ("as of yesterday") and "[a] grand opening (with the sales office on site) is scheduled for Wednesday, March 26." Let’s not forget those invitations to the housewarming(s).
∙ Arterra (300 Berry) Selectively Starts To Shed Its Bovis Blue Wrapper [SocketSite]
∙ The Hayes (55 Page) Strips Off (And Reveals) A Little Bit More [SocketSite]
Posted by socketadmin at 1:00 AM | Permalink | Comments (5) | (email story)
March 18, 2008
1575 South Van Ness: NIMBY Neighbors Actually Arguing For Density?
According to a plugged-in tipster, ICI Paints acquired the remaining 17-year lease for 1575 South Van Ness from Hollywood Video's bankruptcy auction (“outbidding the owner and several other bidders”) and was seeking a conditional use permit to establish “a formula retail use paint store (dba ICI Paints) within an NC-3 (Moderate-Scale Neighborhood Commercial) Zoning District.”
The application for the conditional use permit was, however, denied (although "ICI says they'll fight this "to the top""). And once again according to our tipster: “Neighbors wanted a mixed-use building with ground-floor retail, not a single-storey building sitting on only 40% of the property - while the rest is surface parking - on a site zoned for a 50' building.” NIMBY neighbors actually arguing for density? What a concept.
Posted by socketadmin at 9:35 AM | Permalink | Comments (37) | (email story)
March 17, 2008
Inside One Rincon Hill In Specific (And “No Flip” Clauses In General)
If you actually attended yesterday’s open house for 425 1st Street #2403 (and aren’t just looking at the pictures), now's your chance to share your impressions. And even if you’re not interested in One Rincon Hill in specific, perhaps the ensuing discussion regarding the enforceability of new development “no flip” clauses in general might be worth the read.
∙ The First “Official” Resale (And Open House) At One Rincon Hill? [SocketSite]
Posted by socketadmin at 9:41 AM | Permalink | (email story)
March 16, 2008
Sunday Night Special: The Bear Stearns Blowup (And Balance Sheets)
From a market capitalization of over $10.8 billion last month ($20.2 billion last year), to $3.6 billion on Friday, to an implied $240 million today, roughly $10.5 billion in Bear Stearns’ shareholder equity has evaporated over the past six weeks. And with a third of the bank owned by its employees, employee wealth has been reduced by at least $3.5b during the same period (dropping over $1 billion since Friday alone)*.
From a plugged-in reader who was listening in on the Bear Stearns (BSC) JPMorgan Chase (JPM) conference call earlier this evening:
In effect, JPM is "writing down" the value of nearly $33B in BSC mortgage-related assets to approximately $13B (after giving effect to the $20B of Fed backstop related specifically to these assets). Yes, the value of the mortgage assets on BSC's books, of which only $2B is estimated to be subprime specifically, has been marked to market at a greater than 50% discount to the market value as of 2/29/08. Now, clearly JPM was able to leverage the imminent liquidation of BSC to drive the mark to market value of these assets below the JPM-perceived value of the assets (or they wouldn't have done the deal), but why aren't the rest of the banks going to be forced to further write down the value of their mortgage-backed assets by some amount greater than what's already been done (since the true mark to market value of these assets now lies somewhere between par and more than 50% less than par)? And what does this mean to the value of the average household balance sheet, where the value of the home is a large part, if not a majority, of the "book value" of the average American household?
And then of course there’s the fact that the Fed is operating in complete crisis mode. Don’t think these things will affect all levels of our lilttle local real estate market way out here (from credit to rates to values)? You might want to think again.
*Note: Updated to include shares beyond those in the employee-incentive plan.
∙ JPMorgan Chase to Buy Bear Stearns for $240 Million [Bloomberg]
∙ Fed Lowers Discount Rate, Expands Lending to Prevent Meltdown [Bloomberg]
Posted by socketadmin at 11:43 PM | Permalink | Comments (63) | (email story)
March 14, 2008
The Only Appropriate Headline: “What The Hell Were They Thinking?”
The original photo of 2221 Baker Street:
The altered version that briefly made an appearance as part of the listing:
And the obvious question, what the hell were they thinking?
∙ Say Hello To My Little Friend Frond (And An Orchid) At 2221 Baker [SocketSite]
Posted by socketadmin at 12:10 PM | Permalink | Comments (50) | (email story)
March 13, 2008
If The Plugged-In Readers Are Right, Jumbo-Conformings Are Here
From a plugged-in reader last week:
[E]ffective date of the conforming limit increase, it's going to happen 3/14 (not public knowledge yet).
From a plugged-in reader today:
My mortgage broker just called me and told me [he] had one provider (indymac) who was now providing CA jumbo loans under the new limits ($700k+ vs $417k). He said the spread between the new Jumbo rates versus non-conforming (<=$417k) is 50 basis points as opposed to the 100-150 basis point spread a few months ago.
∙ Fannie Mae's New "Jumbo-Confirming" Loan Guidelines (In Summary) [SocketSite]
Posted by socketadmin at 10:44 AM | Permalink | Comments (26) | (email story)
March 7, 2008
Fannie Mae's New "Jumbo-Confirming" Loan Guidelines (In Summary)
A summary of the new "jumbo-conforming" guidelines (and a link to Fannie Mae's updated sales guide) by way of a plugged-in "ex SF-er":
- 30 yr fixed, 15 yr fixed, 5 year ARM, and 5 year IO ARM only
- 1st lien mortgages ONLY; no cash out refinances
- Can refinance a first loan, but cannot refinance a first and second into the new loan; if there is a second loan it must re-subordinate
- Maximum Loan to Value ratio (LTV) is 90% on fixed mortgage
- Maximum LTV is 80% on an adjustable
- Maximum LTV is 60% on an investment property
- Private mortgage insurance must be bought for all loans with LTV >80%
- Max Debt to Income ratio (DTI) of 45%
- FULL documentation of everything required
UPDATE: A couple of points that we’ll add as well:
- For loans originated between 3/1/2008 and 12/31/2008
- Fixed-rate paper available as soon as April 1, 2008
- Adjustable-rate paper available as soon as May 1, 2008
- Not available for Cooperative or multi-unit properties
- Fixed-rate loans will be subject to a .25% price adjustment (LLPA)
- Adjustable-rate loans will be subject to a .75% price adjustment (LLPA)
∙ Temporary Increase to Conventional Loan Limits: Selling Guide (pdf) [efanniemae.com]
Posted by socketadmin at 7:40 AM | Permalink | Comments (38) | (email story)
March 6, 2008
We Know About Losing A Deposit, But What About Getting One Back?
We’ve heard the stories of contract holders losing their deposits, but a plugged-in reader is hoping for a little guidance from somebody who hasn’t.
I put down a nonrefundable deposit a year ago at a new development. Now that I am about to close on my unit, there's been a change in my financial circumstances for the worse (because of the recession and through absolutely no fault of mine) and I can no longer obtain loan approval. I did obtain preliminary loan approval when I first signed the contract, so that contingency has already been taken out of my contract.
I need to cancel my contract, and it seems like the developer will insist on keeping my deposit. I've heard that in San Francisco, developers will often give money back to the buyers because it is so easy to find another buyer. Is this really true? And if so, is this changing due to the worsening market? I'm interested to see if any other SocketSite reader has cancelled his/her contract and has been able to get their deposit back.
We’re not so sure about that “often,” although we do know of a few big developers who have made exceptions based on significant changes in circumstances (for which you might be able to make an argument). And we can’t tell you how it’s going to play out moving forward. But perhaps a reader (or a friend of a reader) can share a success story (or two).
∙ Infinity And One Rincon Hill: Closings By The Numbers To Date (2/29) [SocketSite]
Posted by socketadmin at 10:13 AM | Permalink | Comments (46) | (email story)
March 5, 2008
733 Front Street Update: 84% Sold (And The First Attempted Resale?)
According to a plugged-in tipster, 733 Front Street is now 84% sold with eleven (11) of the original 69 condos remaining (which represents net new sales of ~12 units over the past five months). From our tipster:
Both of the incentive packages you previously noted remain available [as well as twice-monthly housekeeping services and gourmet meal delivery by Cook!SF for one year]. Interestingly, sales staff are openly discussing price reductions (though of course none of the listing prices have changed), unlike at some other newer developments (170 Off Third comes to mind) where developers are resolutely refusing to discuss such things.
The current “list” prices for six of those eleven remaining units:
733 Front Street #203 (1/1) 949 sqft - $735,000
733 Front Street #207 (1/1) 846 sqft - $695,000
733 Front Street #301 (1/1) 1,004 sqft - $750,000
733 Front Street #307 (1/1) 846 sqft - $715,000
733 Front Street #311 (1/1) 885 sqft - $735,000
733 Front Street #605 (2/2) 1,543 sqft - $1,950,000
And while the developer is offering incentives (and reductions) in order to close the last eleven, 733 Front #213 has hit the resale market with a list price of $659,000 (including “HOA dues paid til Aug. 2008”). As far as we know it was originally offered by the developers for $550,000. And yes, we’ll keep you posted.
∙ Listing: 733 Front Street #213 (1/1) - $659,000 [MLS]
∙ 733 Front: 66% In Escrow And Evidence Of A Few Price Reductions [SocketSite]
∙ The Latest Reminder That Your Neighbor Got A Deal: That Damn Vespa [SocketSite]
∙ New Incentives (And Effective Reductions) At 733 Front Street [SocketSite]
∙ 733 Front Sales Update: 32% In Contract (Almost All Two-Bedrooms) [SocketSite]
Posted by socketadmin at 5:30 AM | Permalink | Comments (9) | (email story)
March 4, 2008
A Chance For You Your Broker To Be Riding In Style
From a plugged-in tipster who’s not a broker (“no idea why they would send me this”) but nonetheless received the following email from Pacific Marketing Associates:
Subject: Brokers! Don't miss your chance to drive a brand new C-Class Mercedes on us!!!
To quote our tipster, "would hate to think my broker is showing me something so he/she could enter a contest!" Keep in mind that your broker will only get one entry into the grand prize lease drawing for a tour. But for an accepted contract, it's another five.
∙ Your Agent Might See Value, But Be Sure To Ask For Whom [SocketSite]
Full Disclosure: SoMa Grand advertises on SocketSite, but has provided no compensation for (nor had any prior knowledge of) this post.
Posted by socketadmin at 8:20 AM | Permalink | Comments (28) | (email story)
February 25, 2008
From Tough Love Comes Positive Change Over At One Rincon Hill
From "One Rincon Hill Resident" (the reader formerly known as “FrustratedBuyer”):
I was told by the excellent sales team at One Rincon Hill that the developer would be changing its policies and procedures. Based on the last couple of comments (NewRinconResident at February 23, 2008 12:40 PM; ORHBuyersAgent at February 23, 2008 12:50 PM), that appears to be the case, and the pre-closing walk through should now be a positive experience for both buyer and seller. The developer is inspecting and making obvious corrections before releasing the units for the walk through and has loosened up on the policy of prohibiting helpful professionals not on title from participation; and the customer service representative who conducts the walk through has cleaned up his act. [SocketSite] is an excellent site for new residents to have a serious exchange of ideas concerning our new homes -- and our comments are noted by the sales staff.
We love it when a plan comes together. And here's to a plugged-in One Rincon Hill Resident for being so "picky" (not to mention having "too much time on his/her hands").
∙ RandomRumors: One Rincon Hill Walkthroughs Without An Agent? [SocketSite]
Posted by socketadmin at 1:56 PM | Permalink | (email story)
A “Bitter” Renter Reports: Repossessed In Lower Pacific Heights
The listing for 1944-1948 Buchanan, a three-unit building in Lower Pacific Heights, notes “Nice building in good condition with good rents” (which add up to $6,425). The listing also notes “REO [bank owned], will entertain all offers” (apparently the good rents didn't cover the good mortgage).
And it’s actually a tipster who’s responsible for a portion (at most $2,825) of those rents.
I’m one of the tenants there and sold my condo 2 years ago to wait for the pending crash before getting in the market again. Now I find myself potentially having to rent again for higher rent OR buy before I’m ready and before market hits bottom, BUT of more interest to your readers is WHERE this happened and is it a harbinger of many more to come in the hood?
And also, what should I do? Stick it out ‘til evicted under Ellis? Or get back in market again?
Questions, questions, questions.
∙ Listing: 1944-1948 Buchanan - $1,795,000 [MLS]
Posted by socketadmin at 5:30 AM | Permalink | Comments (56) | (email story)
February 22, 2008
Conversion Of 140 New Montgomery Moves To Environmental Review
It was nine months ago that the news broke about Meany Sullivan’s purchase of the 26-story Pacific Telephone Building at 140 New Montgomery with plans of converting it from an office building to “a five-star hotel and condominium tower, with a spa, restaurant and bar.” And according to a plugged-in tipster that lives nearby (and in the picture), the project's environmental review notice is making its rounds.
The proposed project is a seismic retrofit and a conversion of the approximately 377,000-square-foot, historic Pacific Telephone and Telegraph Co. Building from office to residential use. The proposed project would contain approximately 135 residential units on the 2nd floor to the 26th floor of the building for a total of about 368,000 square feet of residential space, and an approximately 8,500 square foot restaurant on the ground floor. The height of the building would remain unchanged. An existing below-grade parking garage, accessible from Natoma Street, would be used to accommodate up to 70 valet-parked cars. The proposed project would also include construction of a single-storey horizontal addition to the building on an existing parking lot on the south side of the building to support the residential use.
Also noted by our tipster: "There's no mention...if this is a watered down version of the 5-star-luxury hotel residence that was mentioned last year, but it's good to hear that the building will hopefully eventually move away from being derelict!"
Now about that "You didn't hear it from me...The Waldorf-Astoria, San Francisco" comment a reader left last May...
∙ Another Office To Hotel/Condo Conversion: 140 New Montgomery [SocketSite]
Posted by socketadmin at 3:00 AM | Permalink | Comments (9) | (email story)
February 21, 2008
Infinity And One Rincon Hill: Comments On Closings And Walkthroughs
One plugged-in reader in contract at Infinity needs a new lender (“my loan provider citibank is dropping Infinity as an approved project”) and seeks some other readers’ thoughts on choosing between Wells, Chase or Countrywide.
While another plugged-in reader in contract at One Rincon Hill offers some tough love and thoughts on navigating your walkthrough (and closing).
∙ Infinity Update: Closings, Move-Ins And Even Kitchen Cabinetry [SocketSite]
∙ RandomRumors: One Rincon Hill Walkthroughs Without An Agent? [SocketSite]
Posted by socketadmin at 2:40 PM | Permalink | (email story)
February 13, 2008
JustQuotes: And So Have We (Noticed The Graffiti That Is)
"I lived a couple of blocks south of anonfedup's mom [in Cow Hollow] and instead of poop, I would find used condoms all over the sidewalk....The car break-ins off Union have gotten out of control. I've also noticed a lot more tagging over the last couple few months."
∙ Comment: Apparently San Francisco Attracts A Lot Of Negative People [SocketSite]
Posted by socketadmin at 1:57 PM | Permalink | (email story)
February 11, 2008
SocketSite Readers Report: The Grand Opening of The Greenwich
The twenty-nine new condos at The Greenwich (1501 Greenwich) officially opened this weekend and a few readers have shared their thoughts. And while we're still in search of a complete price list (email tips@socketsite.com), it appears that prices range from $589,000 to $1,949,000 (based on the two units listed on the MLS).
∙ The Greenwich (1501 Greenwich): Website Live And Floor Plans Return [SocketSite]
∙ Listing: 1501 Greenwich #202 (2/2) - $929,000
∙ Listing: 1501 Greenwich #306 (1/1) - $589,000 [MLS]
∙ Listing: 1501 Greenwich #601 (3/2.5) - $1,949,000 [MLS]
Posted by socketadmin at 1:02 PM | Permalink | Comments (29) | (email story)
Another Apple Is Ripening On The Tree In District Nine: 701 Minna #19
Three months ago we received the following note from a plugged-in reader:
I used to live at [701 Minna #19]. In April 06 I had it listed for $930k and ended up selling for $890k, thinking I made a good choice. Though at the current asking (already been lowered from $1195k to $1095k), it would give the owner about $200k appreciation for only spending maybe $2 to $3k for the motorized sunshade/skylight, maybe the paint job cost an arm and a leg.
And while our reader might have been second guessing himself in November, a tip we received yesterday might put his mind at ease (and some others' not):
Check this one out - first listed early Nov. for $1,195,000 then dropped to $1,095,000, then dropped to $899,000 for a few days and now available for $700,000. Purchased in 2006 for $889,000. It's loaded with loans (check out Property Shark) and sits in the glutted cookie cutter loft ghetto. Looks like a desperate short sale.
And speaking of "others," we'll note that the list price on 701 Minna #3 (about 600 square feet smaller than #19) was recently reduced from $664,900 to $629,900 (the listing still notes: “Seller wants this off the books for jan. Fax any offer today.”).
∙ Listing: 701 Minna #19 (2/2.5) 1,781 sqft – $700,000 [Prudential via Pacific Union]
∙ Listing: 701 Minna #3 (1/1.5) 1,173 sqft – $629,000 [MLS]
Posted by socketadmin at 11:09 AM | Permalink | Comments (38) | (email story)
February 4, 2008
Infinity Update: Closings, Move-Ins And Even Kitchen Cabinetry
We’re still working on an “official” update with regard to Infinity closings and move-ins, but a plugged-in reader and uberexcited contract holder swings by the building and reports:
Update on closing dates...We just went by the building...the lobby is pretty much up and running, just needs furniture. There are now doormen at the front desk. We spoke with one of them briefly and he said the first move in will be this coming Monday [2/4]. I was a bit uncertain of this as I thought they were still waiting for the final "white paper" from the CA Dept of Real Estate.
We're now scheduled for a walk through mid February with an end of Feb. close...can hardly wait.
Also, if you've not been to the Studio Becker showroom (8th and Townsend), I'd encourage you to do so. They can help you with adding additional storage in the kitchen (e.g. adding to the island, converting the upper [cabinetry] to fully functional storage versus closed/fixed fronts, etc.) The team there is outstanding.
∙ Walkthroughs At Infinity: A Chance To Share Your Impressions [SocketSite]
∙ Infinity Update: Construction, Tower Two, And Possibly Even Sales [SocketSite]
Posted by socketadmin at 8:53 AM | Permalink | Comments (115) | (email story)
January 24, 2008
The Hayes (55 Page) Strips Off (And Reveals) A Little Bit More
The Hayes (55 Page) is one step closer to architectural judgment (and occupancy) as the majority of blue window wraps have been removed. And while at least one plugged-in reader looks forward to an “early ‘08” move-in, another who was planning on “late ‘07” will no longer be making the move (we’re trying to confirm details on exactly why and what happened to the deposit).
Keep in mind that it was ten months ago that another reader reported 30% sold with sales office expectations of selling out (and moving people in) by the end of 2007. And in terms of net new sales, word on the street is very little movement since our last report of 60% in contract three months ago.
∙ The Hayes (55 Page): Starts To Get Unwrapped And Revealed [SocketSite]
∙ A Plugged-In Reader And Hayes (55 Page) Buyer Reports: 60% “Sold” [SocketSite]
∙ The Hayes (55 Page): A Plugged In Buyer’s Facts (And Opinion) [SocketSite]
Posted by socketadmin at 3:30 AM | Permalink | Comments (31) | (email story)
January 23, 2008
The First Physical Sign (Quite Literally) Of Home Depot Development
A plugged-in reader reports: “As I was driving by today, there were four guys standing on the awning removing the "Home Depot YES" sign and replacing it with a "Home Depot Coming Soon" sign.”
UPDATE: And Bayview Hunters Point Home Blog scores the photographic proof.
∙ Home Depot Bayshore (San Francisco): Let’s Get Ready To Rubble! [SocketSite]
∙ Home Depot Coming Soon [Bayview Hunters Point Home Blog]
Posted by socketadmin at 2:29 PM | Permalink | (email story)
A Reader Reports: 1286-1298 Treat Avenue Goes Up In Flames. Twice.
The Ellis Act eviction notices were served in December 2006, the evictions carried out a year later, and three units at 1286-1298 Treat Avenue returned to the market as TICs not too long ago. And according to a plugged-in tipster, they’ve gone up in flames.
"[1286-1298 Treat Avenue] was torched the night of 1/21 and then mysteriously rekindled itself Tuesday morning. All that seems salvageable is the realtor’s sign, untouched by the blaze."
Borrowing a line from our story about a suspicious fire at 2626 Sutter: "Our first thought? We hope nobody got hurt. Our second thought? Well, let's just say it was probably the same as yours."
∙ Attempt to evict Treat Ave. residents [El Tecolote]
∙ Listing: 1286-1298 Treat Avenue [Vanguard]
∙ 2626 Sutter: Little Did We Know (Or Perhaps We Did) [SocketSite]
Posted by socketadmin at 12:11 PM | Permalink | Comments (40) | (email story)
January 10, 2008
A Plugged-In Reader Vents (And We Honestly Can’t Fault Either Side)
It wouldn’t exactly be going out on a limb to predict that 2016 Pacific #203 will end up selling for “over asking!” Especially considering the note we recently received from a plugged-in (and frustrated) reader in the hunt.
[I’m] writing to vent about 2016 Pacific #203...I heard about it before it went on the market and asked my agent to do some digging because I thought there might be potential to purchase before it was listed.
2 bedroom, 2.5 baths, 2 story, no view, one car parking.
They listed for $1.295M (first open was 1/6) but they'd already gotten a pre-emptive offer at $1.35M before it was listed, which they turned down. As a buyer, it is incredibly frustrating when agents don't price properties at market but rather below-market. Seems to me that the reason is either 1) they want to hit a segment of buyers who might draw their limit at below $1.3M in hopes of enticing them to generate multiple-bid situations; and 2) be able to say that the price sold 'OVER ASKING.' I know many of my friends share the same sentiment and frustration as me... 'over asking' is b.s....
Huh. Perhaps we’re not the only ones who understand that “over asking” is currently more indicative of pricing strategy than anything else. And as an aside, we can’t fault either side for their frustration or approach.
UPDATE: 2016 Pacific Avenue #203 closed escrow on 1/25/08 with a contract price of $1,375,000 (6.2% over asking).
∙ Listing: 2016 Pacific Avenue #203 (2/2.5) - $1,295,000 [MLS]
Posted by socketadmin at 3:15 AM | Permalink | Comments (47) | (email story)
January 9, 2008
The Difference Between "Appreciation" And Actively Adding Value
It’s a plugged-in reader’s comment that serves to demonstrate the difference between passive market "appreciation" and actively adding value (or improvements).
We bought a six unit in NOPA early 05; removed tenants, swapped old cabinets and appliances for new, re-did the floors, added w/d and painted. Paid $282/sq ft to complete ALL of the above. Sold in early 07 for $454/sq ft net after [commissions] and transfer taxes. Made a nifty $986k or 62% ROI. Despite the fact that it took a full 14 months to remove the tenants, it was a fun project.
And of course, it’s also food for thought with regard to what’s driving an increase in many area's "median sales price" (or even price per square foot).
Posted by socketadmin at 12:08 PM | Permalink | Comments (48) | (email story)
January 8, 2008
One Rincon Hill: Closings, Walkthroughs, And (Almost) Anything Else
Okay, so perhaps we were a bit naïve in thinking readers could wait 24 hours to engage in a discussion about walkthroughs and closings specific to One Rincon Hill, so without further ado: "I've been calling One Rincon to ask when I could get into the building and they said they are working on it. Does anyone know when they’ll let people in?"
∙ One Rincon Hill: An Official Update And A Few Confirmed Facts [SocketSite]
Posted by socketadmin at 12:08 PM | Permalink | Comments (18) | (email story)
Walkthroughs At Infinity: A Chance To Share Your Impressions
From a plugged-in reader and contract holder at Infinity:
I'm an infinity buyer and recently received a call from the sales office to come in for my walkthrough...It would be great [to allow readers] to post their experiences with their particular walkthroughs: impressions, problems, surprises, etc. With a good number of responses, it could serve as a nice tool for those of us who have not yet done our walkthrough.
Great idea and consider this the community’s opportunity. An extra special thanks to any plugged-in readers who choose to forward a photo or video to share (tips@socketsite.com). And yes, off topic comments will be summarily censored deleted without apology (and we’ll provide a similar opportunity for buyers at One Rincon Hill tomorrow today).
Oh, and not to spoil the surprise for the buyer(s) of #28A, but that’s the actual view from your unit above (and let's not forget those invitations to the housewarming(s)).
∙ The Infinity: The “Official” Dates And Update (8/24/07) [SocketSite]
Posted by socketadmin at 8:05 AM | Permalink | Comments (36) | (email story)
January 7, 2008
Thirteen More "Anecdotes" Of Distressed Listings In Districts 8 And 9
From a plugged-in Damion Matthews at LiveInSF:
I did just do some research last night on Short Sale and REO listings in districts 8 and 9 – there’s quite a bit. Not as much as in other parts of the state, of course, but more than we’ve seen in those neighborhoods before. I found 13 listings, and 8 of them are lofts. They’re all under $1 million.
Included in the mix is 950 Harrison Street #202 which is 1,120 square feet, has been on the market for two months, and is currently listed for $575,000 (“sold last year for $699,000”). And #S2303 at The Metropolitan (355 1st Street) which is now bank owned, 691 square feet, and listed at $519,000 $599,000 (see UPDATE below).
And no, neither of those two "anomalies" we noted last week (246 2nd Street #1302 and 41 Federal #42) are included in Damion’s thirteen. Nor are any of these in District 10.
UPDATE: Since publishing this story this morning the list price on 355 1st #S2303 has in fact been raised from $519,000 to $599,000. Sorry about that folks.
∙ Distress Deals [LiveInSF]
∙ Listing: 950 Harrison Street #202 (1/1.5) - $575,000 [MLS]
∙ Listing: 355 1st Street #S2303 (1/1) - $519,000 $599,000 [MLS]
∙ One Part Bank And One Part New Building, But Any Parts New Market? [SocketSite]
∙ Going Once, Going Twice…Going Five Times At Shore|Line: 41 Federal [SocketSite]
Posted by socketadmin at 9:40 AM | Permalink | Comments (26) | (email story)
January 4, 2008
JustQuotes: Oakland Is In The House
"We still own a flat in Noe.... we moved to Oakland because of it's great livability, great hills schools, the weather, swift commute,etc. etc. It's a mistake to assume a person is broke and desperate to move out of SF..... you can have your East Bay sunshine and still get dinner at Firefly, coffee at Tartine, and lunch at the Burger Joint with a move to Oakland. Or you can eat at Wood Tavern and Bakesale Betty's......
Everybody raise their hands if they remember when they too thought the coolest thing on earth was the ability to roll out of bed and go hook up with your friends at the Fillmore, Union, "insert any street name here"... Street Fairs. Remember how "hip" it was to wait for a brunch table at Kate's Kitchen, to go hear the great music at Radio Valencia???? Byron..... grow up." (Cashing Out: If It Can Happen There, Can It Happen Anywhere?)
Posted by socketadmin at 3:30 AM | Permalink | (email story)
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.”
Posted by socketadmin at 3:30 AM | Permalink | Comments (22) | (email story)
December 21, 2007
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 [246] 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]
Posted by socketadmin at 2:46 PM | Permalink | Comments (11) | (email story)
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.]
∙ We’re Going With Unique And Perhaps Potential (1330 Greenwich) [SocketSite]
Posted by socketadmin at 10:54 AM | Permalink | (email story)
December 19, 2007
Promoted From Comment To Post: Satchel Does Deflation
We’re not sure whether to call it a guest editorial or a soapbox, but in either case we’re handing plugged-in reader Satchel the mike.
Thanks for the questions regarding how I can be predicting deflation when everyone else seems to be saying inflation (and some price measures are pointing that way). It does seem contradictory, but it's really pretty straightforward when you take it step by step. Apologies to anyone who finds this pedantic or useless. And of course for some of you this will be very obvious. But maybe some of you would find this interesting? As usual, it is long…
First, real wealth is not the same as monetary value (prices). Real wealth (sometimes called real assets) consists of things like real estate, useful goods (like, say, a nice handmade guitar or maybe a store of grain) and control of the factors of production (people typically think equities, but it's really much broader - intellectual capital, the ability of a mother to teach her young children in their earliest years, small unlisted businesses, etc.). Most real assets are assigned a monetary value or price, especially if they are to be exchanged. This is obvious with real estate or equity prices. But think out of the box. Think about how people sometimes say, "I need to monetize my idea" or "monetize my time". Wealth is a pretty broad concept.
Real wealth grows slowly, and is correlated with productivity growth, which is a small number, and, although the tech guys will not like to hear this, is actually today lower than pre-WWII. Lots of debate, and no real reason to go into it here, but suffice it to say, we're talking gains of roughly 1-2% per year per capita. So, real wealth grows slowly, and if too much government gets in the way, it can turn negative (think USSR post- about 1980). (Please guys, don’t tell me about the recent uptrend in trend productivity. I’ve seen the NY Fed data – they’re wrong as far as I can tell, because they’re derived from a deflator that is understated; I guess this is arcane, but for those of you who understand this, you’ll also understand why the government has a systematic bias in favor of understating price inflation measures for obvious reasons.)
In a fiat system, money is debt. Simple as that. Money is literally borrowed into existence. Think about when you buy a house in SF in 1999. Its monetary value then was $1MM. In 2005, say, its monetary value is $2MM. The real value (or wealth) inherent in the house has not increased (technically, there is a slight increase or decrease, but people are already complaining about the bandwith I use, so forgive me if I skip that wrinkle) because it is the SAME house. Same utility. Same wealth. Same real value.
Now, if you borrow $500,000K against it, you get money. Where did that money come from? It was borrowed into existence. That's how it works. In the old days, before Dr. Greedscam, the amount of borrowing available was limited by reserve requirements, so that the Fed could control the rate of growth, at least somewhat (not that they really did). Following 1991, these limits gradually disappeared, as securitization took hold. In its most extreme and current iteration, one could literally create money out of nothing. All you needed was a willing investor (hello silly Asian savers and Eurosclerotics) in a SIV (or conduit, or ABS tranche, or CDO, or CLO, get the picture?), and you could always find a willing American Debt-Serf. By now the fed had basically relinquished all control over borrowing, especially as it was unwilling to disappoint the masses who were increasingly tricked into thinking debt was wealth (and this confusion was a very happy happenstance for the banks and corporations BTW). Nominal debt (and derivatives) EXPLODED – literally into the hundreds of trillions of dollars, although some of these net against each other. Wall Street siphoned off a little bit every time they created one of these things, then took a little more every time they traded, and for good measure even bought them and traded against the infinitely less sophisticated public officials, pension funds, money market funds and, yes, even homebuyers (through excessive fees siphoned off by brokers, re agents, etc). It was literally a slaughter.
Following the example, after you create the $500K of money, you are no more wealthy. This is important. You have exchanged your future earnings (with interest of course) for the newly-created money. In other words, you have exchanged part of your FUTURE wealth (your earnings power and productive capacity or your ability to consume in the future) for current wealth. (You might sometimes hear people throw around the term “Riccardian equivalence” which is basically this idea.) There is an illusion of increased wealth, because of all the money flying around, but wealth is the same on a net basis (across time), increasing slowly as it does. Actually, you take a hit to your wealth – LOL! That’s why all the hedge fund guys are buying yachts and mansions!! – but you won’t realize that until later, if ever. Where do you think Wall Street got all the hundreds of billions in bonuses in the last 6 years while equity markets returned approximately 0% (excluding the fraudulently small dividends received)? Now that return was for the broad S&P. If you happened to be invested in tech stocks generally…..well, you know it was a(nother) slaughter. Hmmm, BTW, where did all that money go?? I’ll let you figure that out, but I’ll give you a hint – drive around Atherton or, even better, Greenwich, Connecticut for some clues…..
Back to your questions now. I think your confusion about inflation is that you are only thinking about it as prices. Think of it as money (credit) supply. As the credit supply is expanded (through borrowing) it is inflated. As it contracts, it deflates. Inflation/deflation. That’s it. But think about the effect on monetary values (prices) of things when credit inflates. The extra money created “chases” some asset prices and goods/services up. Generally, these items are what amateur trader/economists call “houses and haircuts” – that is, fixed assets and services that cannot be arbitraged. You can’t get a haircut from China. You can’t get a house from China. And you can’t eat out at a restaurant in China on a Staurday night and still be home for bedtime. So that created money tends to flow here, raising prices for houses, haircuts and restaurant meals. For things that you can get from China, well, you know the story. Price deflation, which is what you would expect because as productivity rises things become cheaper to make (in real terms).
There’s no real reason prices should go up in the aggregate, absent credit creation. In fact, before we had a fiat money system (basically prior to 1913), you might be surprised to learn that a house in 1780 cost basically the same as it did in 1900! Imagine that. Real estate didn’t go up over a 120 year period!! Well, of course that makes sense, because the REAL VALUE doesn’t really change too much. It never does, not even today. (This is of course super oversimplified, but you get the idea.) Incidentally, over this period, living standards and real income increased dramatically, as many prices fell (through increased productivity), freeing people up to enjoy the fruits of their increased productivity.
Sometimes when credit is expanded recklessly, and under apparent mass psychology conditions that no one can really figure out, the public’s attention is turned to a particular asset or asset class. It could be tulips in Holland, could be land in Florida 1925-26, equities in the 1920s, railroad stocks in the 1840s, a crazy company that no one really could figure out what it was supposed to do (except somehow exchange stock for newly created government debt) in the 1720s England, the twin Japanese real estate and stock bubbles of the late 1980s, the NASDAQ in the late 1990s, or, most unfortunately for some of us, what looks to be the biggest bubble of them all, the (almost) global housing bubble. Although no one wants to admit that SF suffers from it, it would be strange for it to sit out the party, don’t you think, since it is usually on the cutting edge and all??
We’re getting to the good part. What happens when there is deflation? That is, when money/credit is destroyed? And what effects will this process likely have on asset prices, and can certain consumer prices (like food or oil, for instance) still rise in an environment like this, or its variant, what is often thought of as stagflation?
I’ll post more tomorrow. If anyone appreciates this at all, or wants me to absolutely stop, either way, put up a comment, and I’ll try to be a “people pleaser” – as I’m sure you can tell, something that does NOT come naturally to me!
Editor's Note: We're not all that interested in lowest common denominator thoughts, so please don't worry about trying to be a "people pleaser" on this post. And as always, thank you for plugging in (and provoking thought).
Posted by socketadmin at 9:46 AM | Permalink | Comments (39) | (email story)
December 13, 2007
888 Seventh Street: The Three Bedroom Units Going Fast?
While the 888 Seventh Street website still notes “Sales Office Opening Soon,” and the online floor plans would suggest that all fifty-four market rate condos remain “Available,” according to a plugged-in tipster “[t]he 4 (3 bedroom units) in the cafe building [pictured above] are going fast" with the top two already in contract. Needless to say, something seems a bit off (perhaps in more ways than one).
∙ Fifty-Four Market Rate Condos At 888 Seventh Street Coming Soon [SocketSite]
Posted by socketadmin at 3:20 AM | Permalink | Comments (14) | (email story)
Another Reader’s Reality: Living Off Of Third Street In Bayview
On Monday it was one reader’s reality versus perception regarding life around Sixth Street in mid-SoMa/Market/town. Today we highlight another reader’s reality, and this time it’s living off of Third Street in Bayview.
[L]ike many areas of San Francisco you have to be cautious and use common sense. I live on Palou Ave at Lane about a block from 3rd. I have lived there since July. Got a pretty decent deal on a 1200 square foot, 1925 2bedroom house in good shape with views, decent yard, original nice details. I did talk with a few neighbors before getting in. Many long-time owners, also new folks to the neighborhood. Young Latino families, Asian, and several 30 something white gay couples.
I feel reasonably safe, but I have heard gunshots. Only once. I used to live in the Mission and heard them more often. This development [5800 Third Street] and grocery will definitely help establish the neighborhood as a nice and "affordable" for many SF citizens. The grocery is especially needed.
The condo's do have to be pretty nice and large to sell from the mid 500's as I bought my house for $550,000 and there are currently many houses in the $500K to $600K range. I think most people will want a house as opposed to a condo in a 300+ unit condo complex.
∙ Neighborhood Perception Versus (At Least One Reader’s) Reality [SocketSite]
∙ Speaking Of 5800 Third Street (A Development/Developer Update) [SocketSite]
∙ JustQuotes: Fresh & Easy Neighborhood Market Coming To Bayview [SocketSite]
Posted by socketadmin at 3:15 AM | Permalink | Comments (11) | (email story)
December 10, 2007
Neighborhood Perception Versus (At Least One Reader’s) Reality
It's neighborhood perception versus (at least one reader’s) reality:
As someone who has lived within two blocks of [the SoMa Grand] for the last 15 years, I think it deserves mention that this neighborhood has already changed a lot. When I moved into an apartment on Tehama between 5th and 6th back in 1992, there were smash-and-grabs every day, often multiple times a day. I have seen people being zipped up in body bags, shootings, and trannies giving tricks right on the street. But things started changing with the dot-com boom. I believed in the trend enough to purchase a loft on Minna between 6th and 7th in 1992, and felt (barely) safe enough to start a family.
I would never had guessed 15 years ago that there would be a nearby park (Victoria M.) I can actually take kids to. Sure, I still feel out of place when we walk up Sixth to Tu Lan's, but nobody bothers us. And I hate that people use the entry way to our building as their restroom, but even my friends in Pac Heights have to deal with that every once in a while.
Why do I stay? I love being able to walk to work, and to be so close to Yerba Buena Gardens, MOMA, Metreon, Westfield, Union Square, the shops and cafes on Folsom Street, and the Sunday Farmers Market--just to name a few.
So if things get better, great. But as long as they don't get worse I'm cool.
And a question for those in the know, how long has Stan’s stay been extended?
UPDATE: Thanks to Bob, we have the update on Stan's stay: "Stan" was extended to April 15, 2008 by the Recreation and Parks Commission (this was the rare case where everyone from the neighborhood who showed up to testify seemed to love an art installation)."
∙ We Tried To Warn Tell You, The Neighborhood Is A Changing [SocketSite]
∙ Grand-opening of Victoria Manalo Draves Park [BeyondChron]
∙ Stan in SOMA park [Black Rock Arts Foundation]
Posted by socketadmin at 3:30 AM | Permalink | Comments (13) | (email story)
December 6, 2007
A Peek Inside 610 El Camino Del Mar (And Yes, We’re With “Barbco")
When we first featured the Albert Farr designed 610 El Camino Del Mar there weren’t any photos of the interior online (other than of the pool). But having been inside, “barbco” did quite pique our interest with the following comment:
I saw the interior of this home and it is an amazing piece of true Spanish Med, not the knock off stuff you see everywhere. Floor tiles imported from Cuba, Mission and conquistador hand painted tiles on the walls, chunky beams imported from Spain. The home is not "grand" with low ceilings and a 70's kitchen. The pool is probably the best indoor residential pool in the City. It is a "work of art" but you have to live and breathe Spanish Med to the tenth power in every room.
And now that we (and you) can peek inside, we’d have to agree. We're fans (especially of the Cuban tiles). Just don't get us started on the parking lot out back.
∙ Listing: 610 El Camino Del Mar (4/5) - $6,200,000 [610ecdm.com]
∙ An Albert Farr Design Breaks Free (610 El Camino Del Mar) [SocketSite]
Posted by socketadmin at 8:07 AM | Permalink | Comments (19) | (email story)
December 5, 2007
Single-Family Apples To Apples (And A Reader’s Perspective)
It’s a plugged-in reader that alerts us to the sale of 226 Caselli Avenue, a renovated single-family home in Eureka Valley that closed escrow last week for $1,420,200. And it’s the same reader that notes that the home had previously sold for $1,515,000 two years ago (on 8/16/05).
But quite honestly, it's not this home's drop in value over the past couple of years which grabbed our attention (okay, so perhaps a bit). No, it was our plugged-in reader’s side note that did the trick:
Ironically, as new homeowners on the block (yes, we bought within the past year), you would think that we would be dismayed, or at the very least experiencing extreme denial, about these listings. After all, t