CATEGORY ARCHIVE: Trends
November 20, 2009
San Francisco County Unemployment Up To 9.9 Percent In October
Preliminary October labor force data counts for San Francisco, Marin and San Mateo counties puts the unemployment rate at 9.9%, 8.1% and 9.1% respectively, up 0.2 percentage points in San Francisco and up 0.1 percentage points in Marin and San Mateo.
While the number of unemployed in San Francisco increased by 700 (from 43,400 to 44,100) in October, the number of employed fell by 1,600 (from 403,700 to 402,100) as the labor force contracted by 1,000 (from 447,100 to 446,100).
Overall California unemployment increased by 0.3 percentage points to 12.3%.
∙ Monthly Labor Force Data for Counties: October 2009 (Preliminary) [EDD]
∙ San Francisco County Unemployment At 9.7 Percent In September [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (9) | (email story)
November 19, 2009
San Francisco Recorded Sales Activity In October: Up 33.6% YOY
According to DataQuick, recorded home sales volume in San Francisco jumped 33.6% on a year-over-year basis last month (553 recorded sales in October ’09 versus 414 sales in October ‘08) and rose 3.2% compared to the month prior.
San Francisco's median sales price in October was $690,824, down 1.2% compared to October ’08 ($699,000) but up 6.3% compared to the month prior.
For the greater Bay Area, recorded sales volume in October was up 4.2% on a year-over-year basis and up 0.7% from the month prior (7,933 recorded sales in October '09 versus 7,613 in October ’08 and 7,879 in September '09), while the recorded median sales price rose 4.0% on a year-over-year basis, up 6.8% compared to the month prior. Think mix.
Sales in the region’s higher-cost counties – Marin, San Francisco, Santa Clara and San Mateo – represented 42.2 percent of October sales, up from 35.3 percent a year ago, when more sales were concentrated in the lower-cost inland areas rife with deeply discounted foreclosures. Sales over $500,000 made up 36 percent of all sales last month, up from 34.9 percent a year ago and a low this year of 22.7 percent in January.
At the extremes, San Francisco recorded the greatest year-over-year percentage increase in sales volume while Solano recorded a 8.6% year-over-year decrease in sales volume (a loss of 67 transactions) and a 18.8% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
UPDATE: We assumed it went without saying, but with respect to the magnitude of the year-over-year sales increase, keep in mind that October 2008 was a rather rough month for the markets. Recorded San Francisco county October sales figures over the past six years: 720 (2004), 670 (2005), 573 (2006), 526 (2007), 414 (2008), 553 (2009).
∙ Bay Area median sale price tops year-ago level [DQnews]
∙ San Francisco Recorded Sales Activity In September: Up 17% YOY [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (62) | (email story)
US (But Not DA) Prime And FHA Mortgage Defaults Climbing
While subprime adjustable-rate foreclosures starts dropped in the third quarter of 2009 (from 5.52 percent to 4.92 percent), both the number and pace of FHA backed and prime fixed-rate mortgage defaults climbed.
One out of every six FHA mortgages was late by at least one payment and 3.32 percent were in foreclosure, the highest for both since at least 1979, the Mortgage Bankers Association said today. The delinquency rate for prime fixed-rate mortgages, considered home loans with the least risk, rose to 5.8 percent and the foreclosure inventory rose to 1.95 percent, the highest since at least 1972.
The percentage of loans on which foreclosure actions were started was a record 1.42 percent. New foreclosures on prime fixed-rate loans increased to 0.71 percent from 0.67 percent, while FHA foreclosure starts rose to 1.31 percent from 1.15 percent.
From DataQuick today:
Federally-insured FHA loans, a popular choice among first-time buyers, made up 25.9 percent of all Bay Area purchase loans [in October]. That was up from 24.9 percent in September, 19 percent a year ago and less than 1 percent two years ago.
And while default rates are climbing, keep in mind money remains historically cheap:
The 30-year rate dropped to 4.83 percent from 4.91 percent, the lowest since May, mortgage buyer Freddie Mac of McLean, Virginia, said today in a statement. The average 15-year rate fell to 4.32 percent, the lowest since records began in 1991.
∙ FHA, Prime Mortgage Defaults at Records on Job Losses [Bloomberg]
∙ OMG For The FHA [SocketSite]
∙ U.S. Mortgage Rates Fall for Third Consecutive Week [Bloomberg]
Posted by socketadmin at 9:30 AM | Permalink | Comments (1) | (email story)
November 18, 2009
The "Unexpected" Drops Spread To U.S. Residential Construction
"Residential construction in the U.S. unexpectedly dropped in October amid concern a homebuyer tax credit would expire [but didn't], illustrating the market’s dependence on government help to sustain a recovery as job losses mount."
∙ U.S. Economy: Homebuilding Drops as End of Tax Credit Loomed [Bloomberg]
∙ Senate Approves First-Time (And Move-Up) Homebuyer Tax Credits [SocketSite]
∙ San Francisco County Unemployment At 9.7 Percent In September [SocketSite]
Posted by socketadmin at 11:00 AM | Permalink | Comments (0) | (email story)
November 17, 2009
SocketSite's San Francisco Listed Housing Inventory: 11/17/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 4% over the past two weeks and is currently running 25% under 2008 levels on a year-over-year basis (down 30% for single-family homes and down 21% for condos/TICs) but is on par with the average listed inventory levels of 2006/2007.
39% of active listings in San Francisco have undergone at least one price reduction (versus 43% a year ago) while the percentage of active listings that are either already bank owned or seeking a short sale is now almost 12%.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory: 11/02/09 [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (75) | (email story)
Plugged-In People Should Have Seen This One Coming A Year Away
"A report released Monday by the [San Francisco] controller's office shows that property tax revenues will likely be $35 million less than anticipated in the 2009-10 fiscal year that began July 1. Payroll tax revenues will probably be $24.8 million less than expected..."
∙ S.F. home value drop, jobless drain city budget [SocketSite]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (14) | (email story)
November 16, 2009
Oh My (And Bank Owned) At The Odeon On O’Farrell
Purchased for $800,000 in December 2006, Odeon (181 O’Farrell) #508 was taken back by the bank. It’s been listed at $601,400, a sale at which would represent a 25 percent drop in value over the past three years.
Also on the market in the Odeon, #307 which was purchased for $780,000 in March 2007, has been on the market for the past 185 days, and hasn’t moved at $699,000 (a 10 percent drop). And #505 which was purchased for $894,500 in February 2007, has been on the market for the past 56 days, and hasn’t moved at $760,000 (a 15 percent drop).
And then there’s the penthouse (#513) which was purchased for $2,000,000 in March 2007. An attempt to sell it off as a fractional over the past two years failed and it’s been the market as a whole for the past 172 days. Originally asking $2,349,000, it’s been three months at $2,099,000 with an owner that "says make an offer!!"
∙ Listing: 181 O’Farrell #307 (1/1.5) - $699,000 [MLS]
∙ Listing: 181 O’Farrell #508 (1/1.5) 1,047 sqft - $601,400 [MLS]
∙ Listing: 181 O’Farrell #505 (1/1.5) 1,334 sqft - $760,000 [MLS]
∙ Listing: 181 O’Farrell #513 (3/2) 2,516 sqft - $2,099,000 [MLS]
∙ New Developments: Odeon (181 O’Farrell) [SocketSite]
Posted by socketadmin at 12:30 AM | Permalink | Comments (40) | (email story)
November 12, 2009
Average Tax Assessed Reduction Request Is 40% For 2009/10
Perhaps our reader’s 25.7% drop in assessed value for 2009/10 was actually low. From the Chronicle:
Owners of more than 4,000 homes and commercial buildings [in San Francisco] have appealed to the city to have the assessed value of their properties lowered to reduce their taxes. There were 1,200 appeals last year and 300 the year before that.
The total value of those 4,000-plus properties is about $25 billion…[and] the average of the requested reductions is 40 percent, but they have yet to be settled.
We believe there were actually 1,673 appeals last year (versus the Chronicle’s reported 1,200), 810 of which were granted with an average reduction of 11.5%. Unfortunately we don’t have the average for what was requested last year for an early apples to apples comparison.
∙ A 25.7% Drop In Assessed Value For A Plugged-In Reader In 2009/10 [SocketSite]
∙ San Francisco union workers facing layoffs [SFGate]
∙ Average Granted Assessed Value Reduction In San Francisco: 11.5% [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (12) | (email story)
November 9, 2009
High-End Foreclosures Swimming Against A Slowing Low-End Stream
It’s a story on a trend that shouldn’t catch any truly plugged-in readers by surprise: foreclosures are heading upstream. And while the raw numbers remain relatively small as compared to outlying areas and San Francisco’s District 10, it’s the more expensive areas that are leading the way with respect to relative rates of change (i.e., growth) as rates in the less expensive areas are slowing or reversing course.
∙ Default notices rising in upper echelon ZIPs [SFGate]
∙ Actual San Francisco Foreclosures Up 31.6% QOQ (Down 6.8% YOY) [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (24) | (email story)
November 6, 2009
U.S. Unemployment At 10.2 Percent, Five Tenths Above San Francisco
"The unemployment rate in the U.S. soared to a 26-year high of 10.2 percent in October and employers cut more jobs than forecast, underscoring why Federal Reserve policy makers say interest rates will remain near zero."
∙ Unemployment in U.S. Jumps to 10.2%, Payrolls Fall [Bloomberg]
∙ San Francisco County Unemployment At 9.7 Percent In September [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (6) | (email story)
November 3, 2009
Medians Are Up, But Don’t Confuse That With Increasing "Prices"
SFGate recently ran a bit called "Is the bubble back?" highlighting a "creeping" median sales price from August to September in San Francisco as evidence of increasing prices and a real estate "comeback."
Ignoring the fact that the featured RE Report summary data for August doesn’t tie to their own District level data (288 "Home" and 207 "Condo" sales according to their summary versus 202 and 188 sales respectively when we sum their District data), perhaps a basic understanding of what’s driving the change in median sales price is in order.
Repeating the down and dirty analysis we outlined a year ago, if we rank order average District medians in August and September from low-cost to high-cost areas (considering condos and single-family homes as two distinct "Districts"), establish a median "District" or cutoff based on total transactions, and then compare the number of sales in Districts above and below said median we see a nominal 1% decrease in "low-cost" District sales versus a 10% increase in "high-cost" district sales.
Isolating single-family home and condo sales, we see a 23% decrease in "low-cost" district sales versus a 2% decrease in "high-cost" districts for single-family homes. And for condos it’s a 9% increase in "low-cost" districts versus a 22% increase in "high-cost" districts.
In other words, absent any change in underlying "prices," or even despite a decrease, the median sales price in San Francisco was bound to increase as the proportion (mix) of high-cost home sales increased.
And for the last time (we can dream), while median sales price isn’t a bad measure of what people are buying, using changes in median sales price as a proxy for market appreciation (or depreciation) is a lousy if not misleading measure when mix is changing as well.
∙ Is the bubble back? Median prices creeping up in San Francisco [SFGate]
∙ SocketSite's San Francisco Listed Housing Inventory Update: 8/05/08 [SocketSite]
Posted by socketadmin at 3:15 PM | Permalink | Comments (32) | (email story)
November 2, 2009
Employment And Earnings Matter? Who Knew...
"...the belief among many lenders is that the demand for commercial space and condominiums could be "extraordinarily weak" for several more years, in large part because businesses aren't showing signs of growing or hiring. San Francisco's unemployment rate has hovered near 10 percent since June. The state figure was 12.2 percent in September, lending support to the "jobless recovery" theory."
∙ Building in S.F. not expected to grow for years [SFGate]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
∙ San Francisco County Unemployment At 9.7 Percent In September [SocketSite]
Posted by socketadmin at 9:00 AM | Permalink | Comments (46) | (email story)
SocketSite's San Francisco Listed Housing Inventory: 11/02/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 4.2% over the past two weeks and is currently running 21.8% under 2008 levels on a year-over-year basis (down 29% for single-family homes and down 17% for condos/TICs) but remains within five percent of listed inventory levels at the same point in 2006/2007.
36% of active listings in San Francisco have undergone at least one price reduction (versus 40% a year ago) while the percentage of active listings that are either already bank owned or seeking a short sale is just over 10%.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory: 10/13/09 [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (31) | (email story)
October 30, 2009
San Francisco’s Commercial Sublease Snapshot: November 2009
According to Colliers, 2,411,525 square feet of commercial sublease space is currently on the market in San Francisco, down 248,159 square feet over the past 30 days but once again driven by withdrawn listings rather than absorption (negative 89,527 square feet).
The percentage of space available for sublease that is currently vacant is 53 percent.
∙ San Francisco’s Commercial Sublease Snapshot: October 2009 [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (1) | (email story)
October 29, 2009
Will The Stimulated Economy Be As "Sticky" As Real Estate?
"The U.S. economy grew in the third quarter for the first time in more than a year, propelled by stimulus-driven gains in consumer spending and home building."
UPDATE (10/30): "Americans cut spending for the first time in five months and a gauge of confidence weakened, signaling consumers will make a limited contribution to the recovery without government incentives."
∙ Economy in U.S. Expands for First Time in a Year [Bloomberg]
∙ "Credits For Condos" (And Other New Homes) A Clunker As Well? [SocketSite]
∙ From ‘Sticky’ To ‘Slippery’: A Fundamental Change In The Housing Market? [SocketSite]
∙ U.S. Economy: Consumer Spending, Confidence Fall [Bloomberg]
Posted by socketadmin at 10:45 AM | Permalink | Comments (29) | (email story)
October 28, 2009
"Credits For Condos" (And Other New Homes) A Clunker As Well?
Car sales rocketed after the government rolled out their "Cash for Clunkers" sales incentive, but then plummeted when it expired.
New home sales rebounded after the government rolled out tax credits for new home purchases, but have already started to fall in the face of a program end.
As a plugged-in reader correctly notes:
Even builders of more upscale homes have felt the impact of the looming deadline. That's because those move-up buyers will have trouble selling their homes without the incentive of the credit.
The only surprising thing about the decline, that it seems to have been "unexpected."
∙ U.S. New-Home Sales Fall as Credit Nears Expiration [Bloomberg]
∙ Whether Or Not Credits Moved The SF Market, Phase Out Hits Home [SocketSite]
∙ Clunker hangover knocks sales down at Chrysler, Ford, GM [USA Today]
Posted by socketadmin at 10:00 AM | Permalink | Comments (9) | (email story)
October 27, 2009
August S&P/Case-Shiller: San Francisco MSA Continues MOM Uptick
According to the August 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA gained 2.8% from July ’09 to August '09, down 12.5% year-over-year and down 39.3% 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 1.3% from July to August but remain down 30.2% from a peak in June 2006 (down 10.6% year-over-year).
While many of the markets remain down versus this time last year, the relative rate of decline has shown some real improvement. California, in particular, has seen some real positive prints in recent months. We see this general trend whether you look at the as-reported data or the seasonally adjusted figures.
Once again, however, we do want to remind people of the upcoming expiration of the Federal First-Time Buyer’s Tax Credit in November and anticipated higher unemployment rates through year-end. Both may have a dampening effect on home prices.
On a month-over-month basis San Francisco MSA single-family home prices rose across all three price tiers for the third time since May 2006, albeit only nominally at the top.
The bottom third (under $299,828 at the time of acquisition) gained 3.0% from July to August (down 20.4% YOY); the middle third gained 1.8% from July to August (down 10.8% YOY); and the top third (over $558,379 at the time of acquisition) gained 0.2% from July to August (down 12.5% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA are back to May 2000 levels having fallen 60% from a peak in August 2006, the middle third is hovering around May 2002 levels having fallen 38% from a peak in May 2006, and the top third is almost back to March 2004 levels having fallen 24% from a peak in August 2007.
Condo values in the San Francisco MSA fell 0.5% from July ’09 to August '09, down 15.7% on a year-over-year basis and down 27.9% from an October 2005 high. San Francisco was the only MSA to record a month over month decline.
The 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 Continue to Improve According to the S&P/Case-Shiller Index [S&P]
∙ July S&P/Case-Shiller: San Francisco MSA Continues MOM Uptick [SocketSite]
∙ Whether Or Not Credits Moved The SF Market, Phase Out Hits Home [SocketSite]
∙ San Francisco County Unemployment At 9.7 Percent In September [SocketSite]
Posted by socketadmin at 8:30 AM | Permalink | Comments (41) | (email story)
October 22, 2009
Actual San Francisco Foreclosures Up 31.6% QOQ (Down 6.8% YOY)
Bay Area Notices of Default (NODs) in the third quarter of 2009 rose 25.2% on a year-over-year basis, up 72.0% in San Francisco proper (from 353 to 607). NOD activity in San Francisco increased 3.1% from the second to third quarter.
Actual Bay Area foreclosures in the third quarter fell 38.3% on a year-over-year basis (from 12,093 to 7,462) with Contra Costa (down 43.9% to 2,053), Alameda (down 30.2% to 1,760) and Santa Clara (down 42.9% to 1,237) leading the way with respect to volume.
Second quarter recorded foreclosures in San Francisco totaled 179, down 6.8% on a year-over-year basis but up 31.6% (43 homes) from the second quarter 2009. Expect San Francisco foreclosures to continue to rise over the next few quarters as moratorium delayed NODs work their way through the system.
∙ California Mortgage Defaults Trend Down Again [DataQuick]
∙ Actual San Francisco Foreclosures Up 34.7% QOQ (Down 3.5% YOY) [SocketSite]
Posted by socketadmin at 1:00 PM | Permalink | Comments (62) | (email story)
October 21, 2009
RealFacts Reports Asking Rents Down 5.6% In San Francisco
Based on a RealFacts survey of "professionally managed apartment complexes with 50 or more units," The Chronicle reports that average rents in San Francisco are off by a nominal 0.1 percent on a year-over-year basis and 95.8 percent occupancy (down 1.9 percent).
Unfortunately, and not too ironically, the RealFacts survey reflects the not so real market of asking rather than effective rents (after incentives). And keep in mind that over 700 units of new rental inventory has recently (or will soon) come on line in San Francisco and will need to be absorbed.
That new supply includes 192 units at Strata which offered a plugged-in reader a year of free parking and one month free rent, an effective discount of over 8 percent on a one year lease which wouldn't be reflected in the RealFacts survery of asking rents.
As the Chronicle and RealFacts report today, the average asking rents that were down 0.1 percent on a year-over-year basis in April are down 5.6% on a year-over-year basis today.
∙ RealFacts Reports (Not So Real) Asking Rents Flat In San Francisco [SocketSite]
∙ Apartment market moving on up [SFGate]
Posted by socketadmin at 8:15 AM | Permalink | Comments (33) | (email story)
October 16, 2009
San Francisco County Unemployment At 9.7 Percent In September
Preliminary September labor force data counts for San Francisco, Marin and San Mateo counties puts the unemployment rate at 9.7%, 8.0% and 9.0% respectively, down 0.4 percentage points in San Francisco, down 0.3 percentage points in Marin, and down 0.2 percentage points in Marin from August.
While the number of unemployed in San Francisco decreased by 2,200 (from 45,600 to 43,400) in September, however, the number of employed fell by 2,600 (from 406,300 to 403,700) and the labor force contracted by 4,900 (from 452,000 to 447,100).
Overall California unemployment fell by 0.1 percentage points to 12.0%.
∙ Monthly Labor Force Data for Counties: September 2009 (Preliminary) [EDD]
∙ San Francisco County Unemployment Up To 10.1 Percent In August [SocketSite]
Posted by socketadmin at 3:15 PM | Permalink | Comments (14) | (email story)
October 15, 2009
San Francisco Recorded Sales Activity In September: Up 17% YOY
According to DataQuick, recorded home sales volume in San Francisco jumped 17% on a year-over-year basis last month (536 recorded sales in September ’09 versus 458 sales in September ‘08) and rose 2.4% compared to the month prior. The difference between recorded and listed sales activity continues to be driven by unlisted new construction sales.
San Francisco's median sales price in September was $650,000, down 3.7% compared to September ’08 ($675,000) but up 2.4% compared to the month prior.
For the greater Bay Area, recorded sales volume in September was up 4.8% on a year-over-year basis and up 4.8% from the month prior (7,879 recorded sales in September '09 versus 7,271 in August ’08 and 7,518 in August '09), while the recorded median sales price fell 8.8% on a year-over-year basis, up 1.4% compared to the month prior.
"This market may be closer to normal than it was a half year ago, but it's still out of kilter, fueled in large part by incentives and the processing of distressed properties. The sales mix is still lopsided, tilting toward the low end, and lending institutions are only making really safe mortgage loans. For those who can buy, there are some very attractive opportunities. But it still looks like a lot of normal supply-and-demand activity has been put on hold until the economy comes back," said John Walsh, MDA DataQuick president.
At the extremes, San Mateo recorded a 35.1% year-over-year increase in sales volume (a gain of 162 transactions) on a 5.5% drop in median sales price while Solano recorded a 5.0% year-over-year increase in sales volume (a gain of 32 transactions) on a 24.5% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Slight uptick in Bay Area home sales and prices [DQnews]
∙ San Francisco Recorded Sales Activity In August: Down 2.8% YOY [SocketSite]
∙ Listed San Francisco Single-Family Home September Sales: Down 4% [SocketSite]
Posted by socketadmin at 12:45 PM | Permalink | Comments (33) | (email story)
U.S. Foreclosure Filings Jump With Prime And Alt-A Leading The Way
Foreclosure filings in the U.S. increased 29 percent on a year-over-year basis in September, but fell 4 percent as compared to August (a record high month).
Mounting foreclosures mean U.S. home prices probably will resume falling, analysts from Amherst Securities Group LP in New York said Sept. 23. A “shadow inventory” of 7 million properties are in the foreclosure process or likely to be seized, up from 1.27 million in 2005, they said.
The pace of prime and so-called alt-A loan defaults is accelerating as subprime defaults slow, Standard & Poor’s analysts led by Diane Westerback said yesterday in a report. Prime loans are those made to borrowers with the best credit records while alt-A loans are considered riskier because they were often granted without documenting the borrower’s income.
For the third quarter U.S. foreclosure filings jumped 23 percent year-over-year.
∙ U.S. Foreclosure Filings Jump 23% to Record in Third Quarter [Bloomberg]
∙ Subprime And Alt-A Statistics By County: The Feds Mortgage Map [SocketSite]
Posted by socketadmin at 9:15 AM | Permalink | Comments (3) | (email story)
October 14, 2009
Party Like It’s 1999: Dow Crosses 10,000 For The First Time In A Year
While unemployment in San Francisco crossed the ten mark in August (10.1%), today the Dow crossed its ten mark (10,000) for the first time in a year. And which it first did in 1999.
∙ San Francisco County Unemployment Up To 10.1 Percent In August [SocketSite]
Posted by socketadmin at 11:50 AM | Permalink | Comments (15) | (email story)
October 13, 2009
SocketSite's San Francisco Listed Housing Inventory: 10/13/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 2.8% over the past two weeks and is currently running 18.4% under last year’s levels on a year-over-year basis (down 24% for single-family homes and down 15% for condos/TICs) but is within five percent of listed inventory levels at the same point in 2006/2007.
Thirty-three (33) percent of active listings in San Francisco have undergone at least one price reduction while the percentage of active listings that are either already bank owned or seeking a short sale is down to 9.5%.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/28/09 [SocketSite]
Posted by socketadmin at 11:45 AM | Permalink | Comments (57) | (email story)
Listed San Francisco Single-Family Home September Sales: Down 4%
Sales volume for listed single-family homes in San Francisco fell 4% on a year-over-year basis in September (184 transactions in 2008 versus 176 in 2009), down 10% versus August which is in line with an 11% seasonal drop in 2008.
The most significant drop in listed single-family home sales volume occurred in District 3, down 58% on a year-over-year basis (from 19 in 2008 to 9 in 2009) but with a 13% increase in median sales price (think mix).
On the other hand, listed single-family home sales volume in District 7 remained flat on a year-over-year basis at eight (8) sales but with a 20% drop in the median sales price and an average down 6%.
∙ Single Family Homes September ‘04, ‘06, ‘08, ‘09 [sanfranciscoschtuff.com]
∙ Listed San Francisco Single-Family Home Sales In August: Down 5% [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
Posted by socketadmin at 11:15 AM | Permalink | Comments (0) | (email story)
October 5, 2009
A 25.7% Drop In Assessed Value For A Plugged-In Reader In 2009/10
So a year late and quite a few dollars short the Assessor's office granted my informal request for review and lowered my 09/10 assessed value by 25.7% from the "Prop 13 Base Year Value". So after saying my place gained value from Feb 2007 to January 2008 they now say it dropped at least 25% from January 08 to January 09 (and 22.7% from when I purchased it).
Once again, the average granted reduction for 2008/09 was 11.5%. And the San Francisco Tax Assessor’s tally for 2009/10 adjustments should be out soon. Tipsters?
UPDATE: Additional history with respect to the subject property, a 2/1 condo in District 6.
∙ Average Granted Assessed Value Reduction In San Francisco: 11.5% [SocketSite]
Posted by socketadmin at 10:45 AM | Permalink | Comments (58) | (email story)
October 2, 2009
The Real Real Estate Killer Rises Up
As we wrote in January, the real real estate killer and story this year will be unemployment. It’s now up to (at least) 9.8 percent in the U.S. and 10.1 percent in San Francisco county.
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
∙ U.S. Economy: September Job Losses Exceed Forecast [Bloomberg]
∙ U.S. Unemployment Probably Higher Than Reported, Silvia Says [Bloomberg]
∙ San Francisco County Unemployment Up To 10.1 Percent In August [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (37) | (email story)
October 1, 2009
San Francisco’s Commercial Sublease Snapshot: October 2009
According to Colliers International, 2,659,684 square feet of commercial sublease space is currently on the market in San Francisco, down a net 61,396 square feet over the past 30 days but driven by withdrawn listings rather than absorption (negative 37,613 square feet).
The percentage of the space available for sublease that is currently vacant has risen from 49 to 55 percent.
∙ San Francisco’s Commercial Sublease Snapshot: September 2009 [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (9) | (email story)
September 30, 2009
Lemons To Lemons For Thirty Ex-Lembi Apartment Buildings
According to JK Dinnen, at least thirty (30) of the seventy-five (75) or so ex-Lembi owned San Francisco apartment buildings that had been taken back by the banks have been resold at discounts of 25 to 40 percent under what "the Lembis were paying for the buildings at the height of the market."
∙ Building buyers swoop on Lembi apartments [Business Times]
∙ The Chronicle Reports "Dozens," A Plugged-In Source Says Over 100 [SocketSite]
Posted by socketadmin at 11:00 AM | Permalink | Comments (18) | (email story)
September 29, 2009
July S&P/Case-Shiller: San Francisco MSA Continues MOM Uptick
According to the July 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA gained 3.3% from June ’09 to July '09, down 17.9% year-over-year and down 41.0% 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 1.7% from June to July but remain down 31.1% from a peak in June 2006 (down 12.7% year-over-year).
These figures continue to support an indication of stabilization in national real estate values, but we do need to be cautious in coming months to assess whether the housing market will weather the expiration of the Federal First-Time Buyer’s Tax Credit in November, anticipated higher unemployment rates and a possible increase in foreclosures.
On a month-over-month basis San Francisco MSA single-family home prices rose across all three price tiers for the second time since May 2006.
The bottom third (under $287,849 at the time of acquisition) gained 1.9% from June to July (down 26.4% YOY); the middle third gained 1.3% from June to July (down 14.3% YOY); and the top third (over $533,113 at the time of acquisition) gained 1.8% from June to July (down 14.5% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA remain at April 2000 levels having fallen 61% from a peak in August 2006, the middle third is hovering around April 2002 levels having fallen 39% from a peak in May 2006, and the top third is back to February 2004 levels having fallen 25% from a peak in August 2007.
Condo values in the San Francisco MSA gained 2.1% from June ’09 to July '09, down 17.7% on a year-over-year basis and down 27.5% from an October 2005 high.
The 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).
∙ Broad Improvement in Home Prices According to S&P/Case-Shiller Index [S&P]
∙ June S&P/Case-Shiller: San Francisco MSA Up MOM Across All Tiers [SocketSite]
∙ March S&P/Case-Shiller: San Francisco Slide Slows But Continues Fall [SocketSite]
∙ San Francisco County Unemployment Up To 10.1 Percent In August [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (69) | (email story)
September 28, 2009
SocketSite's San Francisco Listed Housing Inventory Update: 9/28/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 3.6% over the past two weeks but is currently running 11.3% under last year’s levels on a year-over-year basis (down 16.2% for single-family homes and down 7.8% for condos/TICs) and within two percent of listed inventory levels at the same point in 2006 and 2007.
Thirty-three (33) percent of active listings in San Francisco have undergone at least one price reduction while the percentage of active listings that are either already bank owned or seeking a short sale is down to 10%.
Keep in mind that listed sales volume in August was down ten percent on a year-over-year basis as well.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/14/09 [SocketSite]
∙ San Francisco Listed Sales Volume In August: Down 10% YOY [SocketSite]
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Record High Ratio Of Unemployed To Openings
At the end of 2001 US unemployed workers outnumbered job openings by a little over two to one, a ratio that climbed to almost three to one in 2003 but then fell to under two to one in 2004.
According to the New York Times and Bureau of Labor Statistics the ratio is currently six to one and climbing.
And while we don't have the ratio for San Francisco (tipsters?), San Francisco unemployment has reached double digits (10.1%) and a twenty-five year high.
∙ U.S. Job Seekers Exceed Openings by Record Ratio [NYT]
∙ San Francisco County Unemployment Up To 10.1 Percent In August [SocketSite]
Posted by socketadmin at 6:10 AM | Permalink | Comments (5) | (email story)
September 25, 2009
U.S. New Home Sales Climb On Discounts And Foreclosures
“Sales of new U.S. homes climbed in August to the highest level in almost a year as builders cut prices at a record pace to compete with the foreclosures that are flooding the market for previously owned houses.”
∙ New-Home Sales in U.S. Climb to Almost One-Year High [Bloomberg]
Posted by socketadmin at 8:15 AM | Permalink | Comments (10) | (email story)
September 21, 2009
San Francisco County Unemployment Up To 10.1 Percent In August
Preliminary August labor force data counts for San Francisco, Marin and San Mateo counties puts the unemployment rate at 10.1%, 8.3% and 9.2% respectively, up 0.2 percentage points in San Francisco and San Mateo and up 0.1 percentage points in Marin from June.
The 10.1% unemployment rate for San Francisco represents a new 25 year high.
The number of unemployed in San Francisco increased by 800 from 44,800 to 45,600 in August while the number of employed decreased by 3,000 (from 409,300 to 406,300) as the labor force decreased by 2,100 (from 454,100 to 452,000).
Overall California unemployment held steady at 12.1% percent in July.
∙ Monthly Labor Force Data for Counties: August 2009 (Preliminary) [EDD]
∙ San Francisco County Unemployment Up To 9.9 Percent In July [SocketSite]
Posted by socketadmin at 5:00 AM | Permalink | Comments (36) | (email story)
September 18, 2009
Wells Fargo Adds 375K Feet To San Francisco’s Negative Absorption
"Wells Fargo has terminated its 375,000-square-foot lease at 155 Fifth St. in San Francisco, adding another empty building to an office leasing market with a nearly 20 percent vacancy rate."
∙ Wells Fargo calls quits at S.F. office building [Business Times]
∙ San Francisco's Office Availability Rate Up To 20 Percent In Q2 2009 [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (8) | (email story)
September 17, 2009
San Francisco Recorded Sales Activity In August: Down 2.8% YOY
According to DataQuick, recorded home sales volume in San Francisco fell 2.8% on a year-over-year basis last month (514 recorded sales in August ’09 versus 529 sales in August ‘08) and fell 1.2% compared to the month prior. The difference between recorded and listed sales activity continues to be driven by unlisted new construction sales (think discounts and expiring tax incentives).
San Francisco's median sales price in August was $635,000, down 12.4% compared to August ’08 ($725,000) and down 1.2% compared to the month prior.
For the greater Bay Area, recorded sales volume in August was up 4.0% on a year-over-year basis but down 14.3% from the month prior (7,518 recorded sales in August '09 versus 7,232 in August ’08 and 8,771 in July '09), while the recorded median sales price fell 19.5% on a year-over-year basis, down 8.9% compared to the month prior and ending a four month string of upticks.
At the extremes, Alameda recorded a 21.0% year-over-year increase in sales volume (a gain of 267 transactions) on a 22.7% drop in median sales price while Solano recorded a 13.2% year-over-year increase in sales volume (a gain of 79 transactions) on a 25.7% drop in median sales price
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Bay Area August home sales and median price fall [DQnews]
∙ San Francisco Recorded Sales Activity In July: Down 10.8% YOY [SocketSite]
∙ San Francisco Listed Sales Volume In August: Down 10% YOY [SocketSite]
Posted by socketadmin at 12:30 PM | Permalink | Comments (55) | (email story)
September 14, 2009
SocketSite's San Francisco Listed Housing Inventory Update: 9/14/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 9.9% over the past two weeks in a typical post-Labor Day bounce. Listed inventory is currently running 6.2% under last year’s levels on a year-over-year basis (down 10.8% for single-family homes and down 2.9% for condos/TICs) and 2.7% lower than at the same point in 2006.
Roughly 31% of active listings in San Francisco having undergone at least once price reduction with the percentage of active listings that are currently either already bank owned or seeking a short sale hovering around 11%. Expect listed inventory levels to continue to climb over the next couple of months.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 8/30/09 [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (22) | (email story)
September 9, 2009
How A Mere Ten Percent Drop Becomes A Hundred Plus Percent Loss
From Bloomberg's story about a spike in "wealthy individuals’" bankruptcy filings related to real estate:
“Real estate is an incredible thing on the downside,” said Jason Green, a bankruptcy attorney based in Washington. “Equities can only go to zero. Property can go well below zero,” because of expenses such as property taxes, insurance and maintenance on primary residences, vacation homes and investment properties.
And then there's that oft touted leverage. Oh, and if we’re not mistaken the image that accompanies Bloomberg’s story looks rather local and familiar.
∙ Wealthy Families Face Bankruptcy on Real Estate Crash [Bloomberg]
Posted by socketadmin at 8:45 AM | Permalink | Comments (8) | (email story)
September 8, 2009
San Francisco Listed Sales Volume In August: Down 10% YOY
While sales volume for listed single-family homes in San Francisco fell 5% on a year-over-year basis in August, condo sales volume fell 16.5% (176 transactions in August 2008 versus 147 in 2009), down 16% from July versus a 10% drop from July to August in 2008.
Combined listed single-family and condo sales volume dropped 10% YOY in August.
With respect to condos, the most pronounced drop in listed sales volume occurred in District 9, dropping 25% (from 67 sales in August of 2008 to 50 sales in August of 2009) on a 14% drop in median sales price from $700,000 to $600,000. Once again, think (and either thank or curse) new development sales offices discounting and stealing share.
On a percentage basis, the biggest drop in sales volume occured in District 5, down 35% from 29 to 19 on year-over-year basis in August on a 2% increase in median sales price but a 10% drop in average.
∙ Condos and Lofts August ‘04, ‘06, ‘08, ‘09 [sanfranciscoschtuff.com]
∙ Listed San Francisco Single-Family Home Sales In August: Down 5% [SocketSite]
∙ San Francisco Listed Sales Volume In July: Down 13% YOY [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
Posted by socketadmin at 11:00 AM | Permalink | Comments (8) | (email story)
September 4, 2009
San Francisco’s Commercial Sublease Snapshot: September 2009
According to Colliers International, 2,721,080 square feet of commercial sublease space is currently on the market in San Francisco (49% of which is currently vacant), up a net 266,000 square feet over the past 30 days.
∙ San Francisco’s Commercial Sublease Snapshot: August 2009 [SocketSite]
Posted by socketadmin at 10:45 AM | Permalink | Comments (22) | (email story)
U.S. Unemployment At 9.7 Percent, Two Tenths Below San Francisco
"The pace of U.S. job losses slowed in August as signs emerged that the recession is ending, while the unemployment rate reached a 26-year high [9.7%]....A rising jobless rate, stagnant wages and falling home values signal a lack of consumer spending may curb an economic recovery."
∙ U.S. Payroll Losses Slow, Unemployment Rises to 9.7% [Bloomberg]
∙ San Francisco County Unemployment Up To 9.9 Percent In July [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (10) | (email story)
September 3, 2009
Listed San Francisco Single-Family Home Sales In August: Down 5%
Sales volume for listed single-family homes in San Francisco fell 5% on a year-over-year basis in August (206 transactions in 2008 versus 196 in 2009), down 12% versus July and versus a 6% drop fom July to August in 2008 according to San Francisco Schtuff.
The most significant drop in listed single-family home sales volume occurred in District 5, down 56% on a year-over-year basis (from 36 in 2008 to 16 in 2009) but with a 3% increase in median sales price (think mix of what's selling).
On the other hand, listed single-family home sales volume in District 1 doubled from 8 to 16 on a year-over-year basis on a 22% drop in the median sales and sales volume in Distruct 7 was flat at ten transactions on a 32% drop in median price.
∙ Single Family Homes August ‘04, ‘06, ‘08, ‘09 [sanfranciscoschtuff.com]
∙ Listed San Francisco Single-Family Home Sales In July: Up 2% YOY [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (21) | (email story)
August 31, 2009
SocketSite's San Francisco Listed Housing Inventory Update: 8/30/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco declined 10.3% over the past four weeks which is not to be unexpected leading up to Labor Day weekend. Listed inventory is currently running 1.5% under last year’s levels on a year-over-year basis (down 17.3% for single-family homes, up 11.2% for condos/TICs) and 12.7% higher than at the same point in 2006.
Roughly 37% of active listings in San Francisco having undergone at least once price reduction with the percentage of active listings that are currently either already bank owned or seeking a short sale hovering around 12%. Expect listed inventory levels to quickly jump around 20% after Labor Day.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 8/03/09 [SocketSite]
Posted by socketadmin at 9:00 AM | Permalink | Comments (17) | (email story)
August 26, 2009
Cash For Closings Has Intended New Home Sales Results
Boosted by an expiring $8,000 tax credit for new-home buyers, the pace of U.S. new home sales increased 9.6 percent from June to July.
The jump in sales was led by a 32 percent surge in the Northeast. Purchases increased 16 percent in the South and 1 percent in the West. They dropped 7.6 percent in the Midwest.
At the same time, however, both sales volume and the median sales price for new homes remain down on a year-over-year basis (down 13 and 12 percent respectively).
∙ U.S. New Home Sales Jump 9.6%, Most in Four Years [Bloomberg]
Posted by socketadmin at 8:45 AM | Permalink | Comments (8) | (email story)
August 25, 2009
June S&P/Case-Shiller: San Francisco MSA Up MOM Across All Tiers
According to the June 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA gained 3.8% from May ’09 to June '09, down 22.0% year-over-year and down 42.9% 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 1.5% from May to June but remain down 32.3% from a peak in June 2006 (down 15.1% year-over-year).
While not alone, Las Vegas and Detroit continue to be two markets that are struggling severely. These are the only two markets that fell in June and saw deterioration in their annual rates of return. Since their relative peaks they have fallen 54.3% and 45.3%, respectively.
On a month-over-month basis San Francisco MSA single-family home prices rose across all three price tiers for the first time since May 2006.
The bottom third (under $276,283 at the time of acquisition) gained 0.8% from May to June (down 30.7% YOY); the middle third gained 2.8% from May to June (down 15.5% YOY); and the top third (over $507,504 at the time of acquisition) gained 2.4% from May to June (down 16.6% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA are hovering around April 2000 levels having fallen 62% from a peak in August 2006, the middle third is hovering around April 2002 levels having fallen 40% from a peak in May 2006, and the top third is back to January 2004 levels having fallen 26% from a peak in August 2007.
Condo values in the San Francisco MSA gained 2.8% from May ’09 to June '09, down 21.6% on a year-over-year basis and down 29.0% from an October 2005 high.
The 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 on an Upswing in the Second Quarter of 2009 [S&P]
∙ May S&P/Case-Shiller: San Francisco MSA Top Tier Up, Bottom Down [SocketSite]
∙ March S&P/Case-Shiller: San Francisco Slide Slows But Continues Fall [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (273) | (email story)
August 21, 2009
San Francisco Recorded Sales Activity In July: Down 10.8% YOY
According to DataQuick, recorded home sales volume in San Francisco fell 10.8% on a year-over-year basis last month (543 recorded sales in July ’09 versus 609 sales in July ‘08) and fell 3.2% compared to the month prior. The difference between recorded and listed sales activity continues to be driven by unlisted new construction sales.
San Francisco was once again one of only two Bay Area counties to record a year-over-year decline in sales volume in July with Marin falling 4.3%. San Francisco's median sales price in July was $642,426, down 14.2% compared to July ’08 ($749,000) and up 1.2% compared to the month prior.
For the greater Bay Area, recorded sales volume in July was up 15.6% on a year-over-year basis and up 1.5% from the month prior (8,771 recorded sales in July '09 versus 7,586 in July ’08 and 8,644 in June '09), while the recorded median sales price fell 16.0% on a year-over-year basis, up 12.2% compared to the month prior (the fourth uptick in 19 months).
The median’s $43,000 gain between June and July was mainly the result of a shift toward a greater portion of sales occurring in higher-priced neighborhoods. The trend has been fueled this summer by several factors, including: More distress in high-end areas, leading to more motivated sellers; more buyers sensing a bottom could be near; and increased availability of larger home loans, which had become more expensive and far more difficult to obtain after the credit crunch hit two years ago.
In another sign of a gradual comeback in home financing, the percentage of Bay Area homes purchased last month with an adjustable-rate mortgage rose to 6.6 percent – up from a record low of 3.0 percent in January 2009. The median sale price for homes purchased with those adjustable-rate loans last month was $766,500, while the median loan amount was $523,500. Adjustable-rate mortgages averaged about 61 percent of all Bay Area purchase loans this decade up until the credit crunch, after which they began to dry up quickly.
At the extremes, Santa Clara recorded a 32.5% year-over-year increase in sales volume (a gain of 639 transactions) on a 16.3% drop in median sales price while Solano recorded a 20.8% year-over-year increase in sales volume (a gain of 123 transactions) on a 27.3% drop in median sales price
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Bay Area home sales hit 4-year high; median price up [DQnews]
∙ San Francisco Recorded Sales Activity In June: Down 1.8% YOY [SocketSite]
∙ San Francisco Listed Sales Volume In July: Down 13% YOY [SocketSite]
∙ Infinity Sales Update: New Contracts Up But Driven By Discounts [SocketSite]
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San Francisco County Unemployment Up To 9.9 Percent In July
Preliminary July labor force data counts for San Francisco, Marin and San Mateo counties puts the unemployment rate at 9.9%, 8.2% and 9.0% respectively, up 0.1 percentage points for San Francisco and San Mateo and up 0.2 percentage points in Marin from June.
The 9.9% unemployment rate for San Francisco represents a new 25 year high.
The number of unemployed in San Francisco increased by 700 from 44,100 to 44,800 in July while the number of employed increased by 3,500 (from 405,800 to 409,300) as the labor force increased by 4,200 (from 449,900 to 454,100).
According to the State of California versus the Labor Department, overall California unemployment has broken through the 12 percent mark (12.1% percent in July).
∙ Monthly Labor Force Data for Counties: July 2009 (Preliminary) [EDD]
∙ San Francisco County Unemployment Jumps To 9.8 Percent In June [SocketSite]
∙ It’s Funny What Happens When People Are Forced To Sell, They Do [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (8) | (email story)
It’s Funny What Happens When People Are Forced To Sell, They Do
While the pace of existing U.S. home sales increased 7.3 percent from June to July (the biggest monthly gain "since records began in 1999") and 5 percent year-over-year, forced sales are driving the activity (31 percent of sales in July were either foreclosures or distressed) and driving the median price down (15 percent on a year-over-year basis).
At the same time, inventory also increased by 7.3 percent, months of unsold inventory remained at 9.4, and U.S. unemployment continued to rise with California hitting 11.9%.
∙ Existing Home Sales in U.S. Jump to Two-Year High [Bloomberg]
∙ Jobless Rates Rise in 26 U.S. States; California’s Hits 11.9% [Bloomberg]
Posted by socketadmin at 8:45 AM | Permalink | Comments (9) | (email story)
August 20, 2009
New Subprime Foreclosures Ease But Prime Foreclosures Exacerbate
From Bloomberg:
Americans fell behind on their mortgage payments at a record pace in the second quarter as job losses and falling real estate prices thwarted government efforts to stabilize the housing market.
The share of loans with one or more payments overdue rose to a seasonally adjusted 9.24 percent of all mortgages, an all- time high, from 9.12 percent in the first quarter, the Mortgage Bankers Association said in a report today. The inventory of homes in foreclosure increased to 4.3 percent, the most in three decades of data, and loans overdue by at least 90 days, the point at which foreclosure proceedings typically begin, rose to 7.97 percent, the highest on record.
“We’ve seen a significant drop in the problem with subprime loans and we’ve moved now to a problem with prime fixed-rate loans,” Jay Brinkmann, the Washington-based trade group’s chief economist, said in an interview. “Job losses are driving it, and we expect that to continue into next year.”
∙ Mortgage Delinquencies Rise to Record as U.S. Home Prices Fall [Bloomberg]
Posted by socketadmin at 7:45 AM | Permalink | Comments (13) | (email story)
August 17, 2009
Shacking Up In San Francisco To Save Some Shekels
"Facing layoffs, pay cuts and furloughs, more people have turned to shared housing to help make ends meet. Craigslist, the online classified ad giant, says that its roommate-wanted postings over the past 12 months are up...85 percent within San Francisco."
∙ More share space to shave costs in recession [SFGate]
Posted by socketadmin at 7:00 AM | Permalink | Comments (17) | (email story)
August 12, 2009
San Francisco Listed Sales Volume In July: Down 13% YOY
While sales volume for listed single-family homes in San Francisco gained 2% on a year-over-year basis in July, condo sales volume fell 28.5% (228 transactions in July 2008 versus 163 in 2009), up 16% from June versus a 27% increase from June to July in 2008.
Combined listed single-family and condo sales volume dropped 13% YOY in July.
With respect to condos, the most pronounced drop in listed sales volume occurred in District 9, dropping 34% (from 88 sales in July of 2008 to 54 sales in July of 2009) on a 23% drop in median sales price from $749,500 to $577,500. Once again, think (and either thank or curse) new development sales offices discounting and stealing share.
Listed condo sales volume in District 5 dropped from 36 to 30 sales year-over-year in July on a 17% drop in median sales price and an 18% drop in average.
∙ Condos and Lofts July ‘04, ‘06, ‘08, ‘09 [sanfranciscoschtuff.com]
∙ Listed San Francisco Single-Family Home Sales In July: Up 2% YOY [SocketSite]
∙ San Francisco Listed Sales Volume In June: Down 14% YOY [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
Posted by socketadmin at 5:45 AM | Permalink | Comments (35) | (email story)
August 4, 2009
Listed San Francisco Single-Family Home Sales In July: Up 2% YOY
Sales volume for listed single-family homes in San Francisco gained a nominal 2% on a year-over-year basis in July (218 transactions in 2008 versus 223 in 2009), up 9% versus June and versus flat from June to July in 2008 according to San Francisco Schtuff.
The most significant gain in listed single-family home sales volume occurred in District 5, up 41% on a year-over-year basis (from 32 in 2008 to 45 in 2009) but on a 21% drop in median sales price (a 26% drop in average).
On the other hand, listed single-family home sales volume in District 4 fell 42% on a year-over-year basis (from 33 in 2008 to 19 in 2009) on almost no change in median sales price but a 12% drop in average.
∙ Single Family Homes July ‘04, ‘06, ‘08, ‘09 [sanfranciscoschtuff.com]
∙ Listed San Francisco Single-Family Home June Sales: Down 6% YOY [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
Posted by socketadmin at 1:45 PM | Permalink | Comments (52) | (email story)
Add A Garage Condo Apartment (Or Two): 1810-1812 Pacific Avenue
Yesterday we saw the "rent to own" posts coming when the listings for 1810 and 1812 Pacific were withdrawn from the MLS. Little did we know they were actually already here.
∙ $7200 / 3br - GORGEOUS New Construction 3-level Townhome [Criagslist]
∙ Add A Garage Condo (Or Two): 1810-1812 Pacific Avenue [SocketSite]
Posted by socketadmin at 1:30 PM | Permalink | Comments (19) | (email story)
U.S. Pending Home Resales Up, U.S. Personal Incomes Down
Pending sales of existing U.S. homes are up while personal incomes are down. As previously outlined, locally a lot will likely come down to (un)employment.
∙ Pending Sales of Existing Homes in U.S. Surge 3.6% [Bloomberg]
∙ U.S. Incomes Fall 1.3%, Biggest Drop in Four Years [Bloomberg]
∙ San Francisco County Unemployment Jumps To 9.8 Percent In June [SocketSite]
Posted by socketadmin at 11:30 AM | Permalink | Comments (4) | (email story)
August 3, 2009
San Francisco’s Commercial Sublease Snapshot
According to Colliers International, 2,454,475 square feet of commercial sublease space is currently on the market in San Francisco (54% of which is currently vacant), down a net 148,911 square feet over the past 30 days driven by withdrawn listings rather than newly signed subleases of which there was only one in July (for a total of 4,460 square feet).
Posted by socketadmin at 10:00 AM | Permalink | Comments (3) | (email story)
SocketSite's San Francisco Listed Housing Inventory Update: 8/03/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco declined 6.4% over the past two weeks (versus an average drop of 1.3% for the same two week period over the previous three years) and is now running just 1.3% higher on a year-over-year basis (down 12.6% for single-family homes, up 11.7% for condos/TICs) and 5.3% higher than at the same point in 2006.
Roughly 37% of active listings in San Francisco having undergone at least once price reduction with the percentage of active listings that are currently either already bank owned or seeking a short sale hovering around 12%. Expect listed inventory to continue to decline through the rest of summer and then spike in late September.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 7/13/09 [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (33) | (email story)
July 29, 2009
Beige Book Results: Real Estate and Construction Remain Weak
The Real Estate and Construction summary from the latest Federal Reserve regional business survey (a.k.a. The Beige Book) for the twelfth district ("San Francisco"):
Conditions in District housing markets remained very weak but showed further signs of improvement, while demand for commercial real estate continued to erode. Sales prices for new and existing homes fell further in most parts of the District, and home construction activity remained at very low levels. Combined with low mortgage rates, however, price declines have propelled a sustained pickup in the pace of home sales in many areas.Demand for commercial real estate fell further, and with rising vacancy rates, tenants have successfully been requesting rent concessions and other new terms on existing leases. Construction activity for commercial properties also continued to fall, and contacts noted that a lack of available credit remained a constraint for construction activity and investment transactions in some areas.
To summarize the summary, residential sales volume is up on falling prices and commercial is getting squeezed. Nothing that should catch a plugged-in person by surprise.
∙ Federal Reserve: Beige Book Twelfth District Summary (7/29/09) [federalreserve.gov]
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July 28, 2009
May S&P/Case-Shiller: San Francisco MSA Top Tier Up, Bottom Down
According to the May 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA gained 1.4% from April ’09 to May '09, down 26.1% year-over-year and down 45.0% from a peak in May 2006.
For the broader 10-City composite (CSXR), home values gained 0.4% from April to May but are down 33.3% from a peak in June 2006 (down 16.8% year-over-year).
As of May 2009, average home prices across the United States are at similar levels to where they were in the middle of 2003, indicating that the three years of appreciation that occurred from 2003-2006 were all given back in the following three years. From the peak in the second quarter of 2006, the 10-City Composite is down 33.3% and the 20-City Composite is down 32.3%.
San Francisco MSA single-family home prices continued to fall across the bottom one-third in terms of price tiers but showed gains at the top.
The bottom third (under $266,630 at the time of acquisition) fell 0.5% from April to May (down 33.3% YOY); the middle third gained 1.0% from April to May (down 18.2% YOY); and the top third (over $485,728 at the time of acquisition) gained 3.8% from April to May (down 19.6% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated to March 2000 levels having fallen 62% from a peak in August 2006, the middle third is hovering around March 2002 levels having fallen 42% from a peak in May 2006, and the top third is back to November 2003 levels having fallen 28% from a peak in August 2007.
Condo values in the San Francisco MSA gained 2.3% from April ’09 to May '09, down 24.7% on a year-over-year basis and down 31.0% from an October 2005 high.
The 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 Price Declines Continue to Abate In May According to S&P/Case-Shiller [S&P]
∙ April S&P/Case-Shiller: San Francisco MSA Top Tier Flatish, Others Fall [SocketSite]
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July 23, 2009
Actual San Francisco Foreclosures Up 34.7% QOQ (Down 3.5% YOY)
Bay Area Notices of Default (NODs) in the second quarter of 2009 rose 7.3% on a year-over-year basis, up 40.9% in San Francisco proper (from 418 to 589). NOD activity in San Francisco increased 3.5% from the first to second quarter.
Actual Bay Area foreclosures in the second quarter fell 25.4% on a year-over-year basis (from 9,293 to 6,929) with Contra Costa (down 30.9% to 2,048), Alameda (down 18.4% to 1,466) and Santa Clara (down 22.4% to 1,210) leading the way with respect to volume.
Second quarter recorded foreclosures in San Francisco totaled 136, down 3.5% on a year-over-year basis but up 34.7% (35 homes) from the first quarter 2009. Expect San Francisco foreclosures to rise dramatically over the next few of quarters as moratorium delayed NODs work their way through the system.
∙ California Second Quarter Mortgage Defaults Edge Down [DataQuick]
∙ Actual Q1 San Francisco Foreclosures Fall But Notices Of Default Spike [SocketSite]
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July 17, 2009
San Francisco County Unemployment Jumps To 9.8 Percent In June
Preliminary June labor force data counts for San Francisco, Marin and San Mateo counties puts the unemployment rate at 9.8%, 8.0% and 8.9% respectively, up 0.7 percentage points for San Francisco and up 0.5 percentage points Marin and San Mateo in May.
The 9.8% unemployment rate for San Francisco in June represents a new 25 year high.
The number of unemployed in San Francisco increased by 3,300 from 40,800 to 44,100 in June while the number of employed fell by 1,300 (from 407,100 to 405,800) as the labor force increased by 1,900 (from 448,000 to 449,900), a net loss of 5,100 over the past three months.
∙ Monthly Labor Force Data for Counties: June 2009 (Preliminary) [EDD]
∙ San Francisco County Unemployment Up To 9.1 Percent In May '09 [SocketSite]
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San Francisco Recorded Sales Activity In June: Down 1.8% YOY
According to DataQuick, recorded home sales volume in San Francisco fell just 1.8% on a year-over-year basis last month (561 recorded sales in June ’09 versus 571 sales in June ‘08) and rose 12.7% compared to the month prior. The difference between recorded and listed sales activity speaks to a spike in unlisted closings, generally new construction or bank-owned sales that we'll once again characterize as being driven by discounting.
San Francisco was only one of two Bay Area counties to record a year-over-year decline in sales volume in June with Napa recording a 4.4% decline. San Francisco's median sales price in June was $635,000, down 12.6% compared to June ’08 ($726,750) and up a nominal 0.2% compared to the month prior.
For the greater Bay Area, recorded sales volume in June was up 20.4% on a year-over-year basis and up 16.1% from the month prior (8,644 recorded sales in June '09 versus 7,178 in June ’08 and 7,447 in May '09), while the recorded median sales price fell 27.4% on a year-over-year basis, up 3.1% compared to the month prior (the third uptick in 18 months).
Last month 37.3 percent of all homes resold in the Bay Area had been foreclosed on in the prior 12 months, down from 40.5 percent in May and the lowest since 36.0 percent in August 2008. The peak was 52.0 percent in February this year. By county, foreclosure resales ranged last month from 6.3 percent of all resales in Marin to 62.7 percent in Solano.
Use of government-insured FHA loans – a common choice among first-time buyers – represented 24.1 percent of all Bay Area purchase loans in June, down from a record 26 percent in April but up from 10.7 percent a year ago.
At the extreme, Solano recorded a 66.5% year-over-year increase in sales volume (a gain of 340 transactions) on a 38.3% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Bay Area home sales and median price rise [DQnews]
∙ San Francisco Recorded Sales Activity In May: Down 16.0% YOY [SocketSite]
∙ San Francisco Listed Sales Volume In June: Down 14% YOY [SocketSite]
∙ Infinity Sales Update: New Contracts Up But Driven By Discounts [SocketSite]
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July 16, 2009
San Francisco Real Estate Barometer: Three Negatives And A Neutral
According to San Francisco’s latest Economic Barometer, the average asking rent for one-bedrooms in the city fell 6.3% from April to May and is down 15.4% year-over-year while the commercial average asking lease rate has fallen 30.6% year-over-year.
The City’s five-year position for Median Home Sales Price (currently "neutral") and Commercial Average Asking Lease Rate (currently "negative"): "weak" on rising unemployment.
∙ San Francisco Monthly Economic Barometer - May 2009 [SFGov]
∙ San Francisco County Unemployment Up To 9.1 Percent In May '09 [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (13) | (email story)
July 14, 2009
Ten Below Over Freezing. Except For That One At Twenty-Nine...
If you read Bloomberg yesterday you learned that the past three Decorator Showcase homes in San Francisco are on the market, and that this year’s showcase (2830 Pacific) "was listed at $12.9 million in April and the price was reduced in May."
“Things reached a fever pitch two years ago when people thought they could do no wrong in real estate,” said Malin Giddings, co-listing agent for this year’s seven-bedroom, six- bathroom home. “Now the game is over.”
You were also told that the "last time a house in San Francisco fetched at least $10 million was in June 2008, according to the city assessor-recorder office."
Of course plugged-in people know that 2830 Pacific was actually asking $15,500,000 before being listed in April (and then reduced in May), and that it’s more like six out of the past ten showcase homes that are struggling to find buyers.
Oh, and 2799 Broadway (A.K.A. 37 Raycliff Terrace) sold for $29 million in September 2008. But hey, who are we to quibble with Bloomberg.
∙ Mansion Glut in Pelosi’s San Francisco Neighborhood Slows Sales [Bloomberg]
∙ Another Ex-Decorator Showcase Is Officially Listed: 2500 Divisadero [SocketSite]
∙ 2009 Decorator Showcase (2830 Pacific) Opens Its Doors And Kimono [SocketSite]
∙ Showcasing A Designer Price Cut: 2830 Pacific Sheds Another 29% [SocketSite]
∙ The SocketSite Scoop On 37 Raycliff Terrace (A.K.A. 2799 Broadway) [SocketSite]
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July 13, 2009
San Francisco's Office Availability Rate Up To 20 Percent In Q2 2009
"CBRE says that downtown San Francisco’s availability rate for office space has now cracked 20 percent. It predicts that the city “will soon pass its all-time availability rate of 20.6 percent.” The brokerage reports that the city saw a 778,000-square-foot net vacant increase in vacant space [in Q2]."
∙ Office space availability tops 20 percent mark [San Francisco Business Times]
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SocketSite's San Francisco Listed Housing Inventory Update: 7/13/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco declined 3.1% over the past two weeks (versus an average gain of 4.3% for the same two week period over the previous three years and a 0.3% drop in 2008) and is now running 6.7% higher on a year-over-year basis (down 4.1% for single-family homes, up 14.5% for condos/TICs) and 11.3% higher than at the same point in 2006.
The drop in inventory is being driven by both sales (down 14% YOY in June) and a seasonal withdrawing of listings, with just under 38% of active listings in San Francisco having undergone at least once price reduction (up from just over 32% at the same time last year). The percentage of active listings in San Francisco that are currently either already bank owned or seeking a short sale remains at just over 13%.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/29/09 [SocketSite]
∙ San Francisco Listed Sales Volume In June: Down 14% YOY [SocketSite]
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July 9, 2009
San Francisco Listed Sales Volume In June: Down 14% YOY
While sales volume for listed single-family homes in San Francisco fell 6% on a year-over-year basis in June, condo sales volume fell 22% (180 transactions in June 2008 versus 140 in 2009), up 27% from May and versus a 14% drop over the same period in 2008.
Combined listed single-family and condo sales volume dropped 14% YOY in June.
With respect to condos, the most pronounced drop in listed sales volume occurred in District 9, dropping 36% (from 64 sales in June of 2008 to 41 sales in June of 2009) on a 23% drop in median sales price from $769,500 to $595,000. Think (and either thank or curse) new development sales offices discounting and stealing share.
∙ Condos and Lofts June ‘04, ‘06, ‘08, ‘09 [sanfranciscoschtuff.com]
∙ Listed San Francisco Single-Family Home June Sales: Down 6% YOY [SocketSite]
∙ San Francisco Listed Sales Volume In May: Down 37% YOY [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
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July 8, 2009
PMI’s Market Risk Index Report: 1st Quarter 2009
According to the latest PMI Market Risk Index, the San Francisco-San Mateo-Redwood City MSAD ended the first quarter of 2009 with a 66.2% likelihood of house price declines over the next two years, up from 31.6% in the fourth quarter of 2008, up from 30.2% in the fourth quarter of 2007, and up from 39.5% at the beginning of 2005.
The likelihood of decline for a few other nearby areas: Sacramento-Arden-Arcade-Roseville (99.9%), Oakland-Fremont-Hayward (96.4%), San Jose-Sunnyvale-Santa Clara (78.4%).
Keep in mind that the PMI Market Risk Index is tied to the OFHEO house price index which "excludes jumbo loans and the large portion of subprime and Alt-A loans that Fannie Mae and Freddie Mac don’t participate in."
· Economic and Real Estate Trends: 2nd Quarter 2009 [PMI Group]
∙ PMI’s Market Risk Index And Real Estate Trends Report: Spring 2008 [SocketSite]
∙ Economic And Real Estate Trends: Spring 2005 [SocketSite]
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July 7, 2009
Listed San Francisco Single-Family Home June Sales: Down 6% YOY
Sales volume for listed single-family homes in San Francisco fell 6% on a year-over-year basis in June (219 transactions in 2008 versus 205 in 2009), up 19% versus May (and versus a 6% drop from May to June in 2008) according to San Francisco Schtuff.
Listed single-family home sales in "Prime" District 7 nearly doubled on a year-over-year basis (from 10 in 2008 to 17 in 2009), but on a 43% drop in median sales price (a 48% drop in average).
∙ Single Family Homes June ‘04, ‘06, ‘08, ‘09 [sanfranciscoschtuff.com]
∙ San Francisco Listed Sales Volume In May: Down 37% YOY [SocketSite]
∙ San Francisco Real Estate Districts: Maps And Neighborhoods [SocketSite]
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July 6, 2009
QuickLinks: Thank Goodness That Foreclosure Crisis Is Over…
∙ New Evidence on the Foreclosure Crisis [WSJ]
∙ Another wave of foreclosures is poised to strike [LA Times]
∙ A New All-Time High (Or Rather Low) For U.S. Prime Delinquencies [SocketSite]
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July 1, 2009
San Francisco Retail Space Update: Vacancy Rate Up Four-ish Fold
According to Colliers International retail broker Ross Portugeis, "San Francisco’s retail vacancy rate leaped in the past year from 3 or 4 percent to 12 or 13 percent" but Portugeis feels the market started stabilizing in May. As always, time and SocketSite will tell.
And according to Edward Plant of Edward Plant Co. Inc. which specializes in leasing San Francisco retail space, the strongest markets/streets currently include Chestnut, Castro and Hayes, while the weakest include Union, Fillmore and Valencia.
No mention of the numerous still vacant retail spaces in new developments across town.
∙ Empty stores boost lease deals [San Francisco Examiner]
Posted by socketadmin at 8:15 AM | Permalink | Comments (5) | (email story)
June 30, 2009
A New All-Time High (Or Rather Low) For U.S. Prime Delinquencies
The delinquency rate for prime mortgages over 60 days behind continued to climb from 2.4% in the fourth quarter of 2008 to 2.9% through March 31, 2009 (up from 1.1% at the same point in 2008) as "first-time foreclosure filings on [prime] loans rose 22 percent from the fourth quarter."
The delinquency rate for prime mortgages in the U.S. has hit a new all-time high (or perhaps low). And overall, "mortgages 60 days or more past due rose 88 percent from last year." You know, when it was simply a subprime problem.
∙ U.S. Prime Delinquency Rate Doubles, Alt-A Approaches 10% [SocketSite]
∙ Delinquencies Double on Least-Risky Loans, U.S. Says [Bloomberg]
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April S&P/Case-Shiller: San Francisco MSA Top Tier Flatish, Others Fall
According to the April 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA gained 0.6% from March ’09 to April '09, down 28.0% year-over-year and down 45.8% from a peak in May 2006.
For the broader 10-City composite (CSXR), home values fell 0.7% from March to April and are down 33.6% from a peak in June 2006 (down 18.0% year-over-year).
In addition to the 10-City and 20-City Composites, 13 of the 20 metro areas also saw improvement in their annual return compared to that of March. Furthermore, every metro area, except for Charlotte, recorded an improvement in monthly returns over March. While one month’s data cannot determine if a turnaround has begun; it seems that some stabilization may be appearing in some of the regions. We are entering the seasonally strong period in the housing market, so it will take some time to determine if a recovery is really here.
San Francisco MSA single-family home prices continued to fall across the bottom two-thirds in terms of price tiers, but gained nominally at the top.
The bottom third (under $265,194 at the time of acquisition) fell 1.8% from March to April (down 35.4% YOY); the middle third fell 0.7% from March to April (down 19.5% YOY); and the top third (over $479,157 at the time of acquisition) gained 0.2% from March to April (down 21.9% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated below April 2000 levels having fallen 62% from a peak in August 2006, the middle third has fallen to November 2001 levels having fallen 42% from a peak in May 2006, and the top third is holding at April 2003 levels having fallen 30% from a peak in August 2007.
Condo values in the San Francisco MSA gained 0.3% from March ’09 to April '09, down 26.9% on a year-over-year basis and down 32.5% from an October 2005 high.
The 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).
∙ The Pace of Home Price Declines Moderate in April According to S&P/Case-Shiller [S&P]
∙ March S&P/Case-Shiller: San Francisco Slide Slows But Continues Fall [SocketSite]
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June 29, 2009
SocketSite's San Francisco Listed Housing Inventory Update: 6/29/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco declined 0.7% over the past two weeks (versus an average drop of 2.6% for the same two week period over the previous three years) and is now running 9.8% higher on a year-over-year basis (down 0.5% for single-family homes and up 16.9% for condos/TICs) and 24.4% higher than at the same point in 2006.
Just under 39% of active listings in San Francisco have undergone at least once price reduction (up from just over 32% at the same time last year). And just over 12% of active listings in San Francisco are currently either already bank owned or seeking a short sale.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/15/09 [SocketSite]
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Past Performance Recoveries Are No Guarantee Of Future Results
"The residential real estate market improved ahead of the end of the past seven contractions, with home construction starts beginning to climb an average of seven months before gross domestic product picked up and sales gaining about four months in advance, according to data compiled by David Berson, chief economist of PMI Group, a mortgage insurer in Walnut Creek, California."
∙ Housing in Peril as Obama Fails to Get Financing Breakthrough [Bloomberg]
Posted by socketadmin at 8:00 AM | Permalink | Comments (2) | (email story)
June 23, 2009
QuickLinks: A Foreclosure Triptych
∙ Home Resales in U.S. Rise 2.4% in May to 4.77M Rate Amid Foreclosures [Bloomberg]
∙ U.S. Home Prices Drop 6.8 Percent in April as Foreclosures Rise [Bloomberg]
∙ Housing Eludes Recovery as Job Losses, Foreclosures Climb [Bloomberg]
Posted by socketadmin at 7:30 AM | Permalink | Comments (3) | (email story)
June 19, 2009
San Francisco County Unemployment Up To 9.1 Percent In May '09
Preliminary May labor force data counts for San Francisco, Marin and San Mateo counties puts the unemployment rate at 9.1%, 7.5% and 8.4% respectively, up 0.3 percentage points from April across the board.
The 9.1% unemploment rate for San Francisco in May represents a new 25 year high.
Extending the observations of a plugged-in reader last month, the number of unemployed in San Francisco increased by 1,000 from 39,800 to 40,800 in May while the number of employed fell by 5,800 (from 412,900 to 407,100) as the labor force fell by 4,800 (from 452,800 to 448,000), a loss of 7,000 over the past two months.
∙ Monthly Labor Force Data for Counties: May 2009 (Preliminary) [EDD]
∙ San Francisco County Unemployment Dips To 8.8 Percent In April '09 [SocketSite]
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June 18, 2009
San Francisco Recorded Sales Activity In May: Down 16.0% YOY
According to DataQuick, recorded home sales volume in San Francisco fell 16.0% on a year-over-year basis last month (498 recorded sales in May ’09 versus 593 sales in May ‘08) but rose 23.9% compared to the month prior. The difference between recorded and listed sales activity speaks to a spike in unlisted closings, up 46% YOY and generally new construction or bank-owned sales that we'll once again characterize as being driven by discounting.
San Francisco continued to experience the sharpest year-over-year decline in sales volume of any Bay Area county in May with Marin the only other county recording a decline (-2.7%). San Francisco's median sales price in May was $634,000, down 19.7% compared to May ’08 ($790,000) but up a nominal 0.9% compared to the month prior.
For the greater Bay Area, recorded sales volume in May was up 19.8% on a year-over-year basis and up 4.3% from the month prior (7,447 recorded sales in May '09 versus 6,216 in May ’08 and 7,139 in April '09), while the recorded median sales price fell 33.9% on a year-over-year basis, up 12.3% compared to the month prior (the second uptick in 18 months).
Last month 42.1 percent of all homes resold in the Bay Area had been foreclosed on in the prior 12 months, down from 46.4 percent in April and the lowest since the figure was 41.6 percent last September. A year ago the percentage was 27.7 percent, while the peak was 52.0 percent this February. By county, foreclosure resales ranged last month from 7.7 percent of all resales in San Francisco to 65.1 percent in Solano.
The use of government-insured FHA loans – a common choice among first-time buyers – represented a 24.5 percent of all Bay Area purchase loans in May, down slightly from a record of 26.0 percent in April but up from 7.3 percent a year ago.
At the extremes, Solano recorded a 51.8% year-over-year increase in sales volume (a gain of 241 transactions) on a 36.8% drop in median sales price, while Contra Costa recorded a 40.5% year-over-year increase in sales volume on a 39.9% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Uptick in Bay Area home sales and median price [DQnews]
∙ San Francisco Recorded Sales Activity In April: Down 33.6% YOY [SocketSite]
∙ San Francisco Listed Sales Volume In May: Down 37% YOY [SocketSite]
∙ Infinity Sales Update: New Contracts Up But Driven By Discounts [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (13) | (email story)
June 17, 2009
Marcus & Millichap Changes Their San Francisco 2009 Rental Outlook
As we wrote in January:
The Marcus & Millichap rental outlook for 2009 in San Francisco: rents up 3.3% on 400 new units in professionally managed apartment buildings with at least 20 units.
Our comment (at the risking of stealing a bit of our own outlook thunder): we believe Marcus & Millichap is significantly underestimating both the number and impact of "shadow” market units for rent in San Francisco (which they deem to be "barely a factor") as well as the effective number of new units for rent that will hit the market in 2009.
A new report from Marcus & Millichap, however, now calls for a 8.9% drop in residential rents in San Francisco by the end of the year, a dramatic 12.2 point swing in their forecast over the past six months. Our outlook and original rebuttal haven't changed.
UPDATE: A plugged-in reader adds:
There have been more drastic decreases in SOMA. I wanted to move there last year but asking rents were north of 3500 for 2bd/2ba in most complexes (avalon, bayside, archstone). I just rented the same 2bd/2ba for 2700 (2800 with parking) with a better layout and more sq footage.
That's a 23% drop (and some good shopping) for "somaboy," and a tough trend in terms of (E)arnings for investors who paid a high (P)rice based on wildly different expectations.
∙ Marcus & Millichap San Francisco Rental Outlook (And Quick Rebuttal) [SocketSite]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (76) | (email story)
June 15, 2009
Are The "Exceptions" (And Big Losses) Becoming A Palms Rule?
What some are wont to characterize as San Francisco "exceptions" are quickly becoming the rule for two-bedroom condo re-sales at The Palms (555 4th Street).
While #401 closed escrow with a reported contract price of $599,900 in January (purchased for $779,000 in October 2006), and #313 is still seeking a short sale at $599,900 (purchased for $800,000 in January 2007), the list price for #731 has been reduced to a "bank approved price" of $619,000 (purchased for $925,000 in August 2006).
555 4th Street #823 is currently in contract having been listed at $605,000 (purchased for $815,000 in January 2007). And the only other two-bedroom currently listed at The Palms is #309, purchased for $842,500 in September 2006 and currently seeking $670,000.
Once again, all two-bedroom condos with declines in value ranging from 23% to 33% since late 2006/early 2007. Of course that's assuming sales at list.
∙ Listing: 555 4th Street #309 (2/2) 1,113 sqft - $670,000 [MLS]
∙ Listing: 555 4th Street #313 (2/2) 1,111 sqft - $599,900 [MLS]
∙ Listing: 555 4th Street #731 (2/2) 1,052 sqft - $619,000 [MLS]
∙ Pushing Forward With Price Discovery At The Palms (555 4th Street) [SocketSite]
∙ A SoMa/Palms Wake Up Call (And Apple): 555 4th Street #401 [SocketSite]
Posted by socketadmin at 3:30 PM | Permalink | Comments (66) | (email story)
SocketSite's San Francisco Listed Housing Inventory Update: 6/15/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco declined 1.9% over the past two weeks (versus an average increase of 8.5% for the same two week period over the previous three years) and is now running 9.0% higher on a year-over-year basis (down 4.2% for single-family homes and up 18.1% for condos/TICs) and 22.7% higher than at the same point in 2006.
At the same time, listed sales activity has fallen by 37% on a year-over-year basis with the effective mid-June months of inventory based on sales velocity in May rising roughly 72% on a year-over-year basis from 3.4 months in 2008 to 5.8 months in 2009, and up 108% from 2.8 months in 2006.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/01/09 [SocketSite]
∙ San Francisco Listed Sales Volume In May: Down 37% YOY [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (33) | (email story)
June 12, 2009
JustQuotes: It's A Good Time To Be A New Tenant In San Francisco
"Tenant-starved San Francisco office landlords are laying on the concessions. A new report from the tenant brokerage Studley shows property owners are now shelling out an average of $45 per square foot in concessions to tenants willing to ink a long-term deal. The amount of free rent owners are doling out has jumped to seven months, while tenant improvement allowances are now averaging $50 a square foot. Studley says asking rents are down 30 to 50 percent in many buildings and tenant demand is off 40 percent. Average Class A asking rent is $34.74 a square foot, down 25.3 percent from last year..."
∙ S.F. landlords entice tenants with concessions [San Francisco Business Times]
Posted by socketadmin at 9:00 AM | Permalink | Comments (10) | (email story)
June 11, 2009
Mortgage Rates Continue To Climb (And It's All The Russians' Fault)
The average 30-year U.S. mortgage rate bumped up 30 basis points over the past week to 5.59 percent, a 68 basis point jump over the past two weeks. Of course we're kidding about it being all the Russians' fault, but they do come into play.
∙ Mortgage Rates in U.S. Rise to Highest Since November [Bloomberg]
∙ A Six Month High For Mortgage Rates (But Still Historically Cheap) [SocketSite]
∙ BRICs Buy IMF Debt to Join Big Leagues, Goldman Says [Bloomberg]
Posted by socketadmin at 3:00 PM | Permalink | Comments (16) | (email story)
June 10, 2009
San Francisco Listed Sales Volume In May: Down 37% YOY
Sales volume for listed single-family homes and condos in San Francisco fell 37% on a year-over-year basis in May according to San Francisco Schtuff, with listed single-family home sales down 27% (235 transactions in 2008 versus 172 in 2009) and condo sales down 48% (210 transactions in 2008 versus 110 in 2009).
The biggest drops in sales volume occurred in Districts 8 (down 55%), 5 (down 43%) and 2 (down 43%). Not a single district (nope, not even the much maligned but now suddenly "real" 10) recorded a year-over-year sales "rebound."
Tomorrow Monday, the medians.
UPDATE (6/11): In case you don't know your Districts: San Francisco Real Estate Districts: Maps And Neighborhoods.
∙ Single Family Homes May 2004 v. 2006 v. 2008 v. 2009 [SFSchtuff]
∙ Condo and Loft Sales May 2004 v. 2006 v. 2008 v. 2009 [SFSchtuff]
∙ No Rebound For You! (In Fact A Below Average Seasonality Bump) [SocketSite]
Posted by socketadmin at 2:00 PM | Permalink | Comments (62) | (email story)
June 8, 2009
A Few More Numbers For The Most Recent Lembi Twelve
Some additional numbers on the twelve properties the Lembis put on the market in May:
Lembi hopes to generate $43 million in revenue from the disposition, which equates to approximately $185,000 per unit, approximately 50% of replacement cost and a significant discount to what it paid to acquire the properties.
The buildings may sell as a group or individually. Most were constructed in the first quarter of the 21st century and a few were built in the 1960s. The per-unit prices range from $320,000 to $100,000. Most of the projected cap rates on the buildings are in the 5% range and are based on scheduled income and a 3% vacancy factor. Much of the interest so far has been local buyers each looking to purchase one or two properties, according to local sources.
The sales will be watched closely by the market because only one other comparable property has sold in San Francisco this year, according to Real Capital Analytics. The property was Empire, a 40-unit, four-story property built in 1907 at 1040 Leavenworth Street. The property sold for $5.8 million or $145,000 per unit; the pro forma cap rate was 4.7%. All of the Lembi properties are said to be of higher quality.
According to MPF Research, San Francisco rents dropped 5.2% in the first quarter of 2009.
∙ Lembi Group Puts 12 Apartment Assets up for Sale [CityFeet]
∙ Lembis Look To Cut Another Twelve Loose As Rental Market Drops [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (65) | (email story)
June 5, 2009
If You're Looking To Renovate Or Rewire In San Francisco...
"Unemployment in San Francisco’s building trades sector is over 20 percent, with about 50 percent of unionized electricians out of work, according to San Francisco Building and Construction Trades Council President Mike Theriault.
With 16,000 members, that means that more than 3,200 building trades workers are currently without a job. Unemployment among laborers and carpenters is running at more than 20 percent, while iron workers have the lowest jobless rate -- about 10 percent."
Unemployment is over 20% for S.F. building sector [San Francisco Business Times]
Posted by socketadmin at 3:30 PM | Permalink | Comments (18) | (email story)
June 4, 2009
A Six Month High For Mortgage Rates (But Still Historically Cheap)
"Fixed U.S. mortgage rates jumped to the highest level this year, signaling the Federal Reserve’s plan to lower borrowing costs has stalled. The average 30-year rate rose to 5.29 from 4.91 percent a week earlier...The last time the rate was higher was Dec. 11, when it was 5.47 percent. The average 15-year rate rose to 4.79 percent from 4.53 percent."
∙ U.S. Mortgage Rates Jump to Highest Since December [Bloomberg]
∙ It's Like The Fed (And Taxpayers) Just Bought You A Couple Of Points [SocketSite]
Posted by socketadmin at 9:15 AM | Permalink | Comments (13) | (email story)
June 2, 2009
Pending U.S. Home Sales Up 3.2% YOY (Down 2.9% In The West)
The National Association of Realtors' Pending U.S. Home Sales Index rose rose 6.7 percent from March to April and is up 3.2 percent on a year-over-year basis. The bulk of the YOY gains have, however, occured in the Midwest with the West down 2.9 percent.
The Pending Home Sales Index in the Northeast shot up 32.6 percent to 78.9 in April and is 0.8 percent above a year ago. In the Midwest the index rose 9.8 percent to 90.4 and is 11.1 percent above April 2008. The index in the South slipped 0.2 percent to 93.0 in April but is 3.5 percent higher than a year ago. In the West the index rose 1.8 percent to 94.8 but is 2.9 percent below April 2008.
∙ Pending Home Sales Up for Three Months in a Row [NAR]
Posted by socketadmin at 8:30 AM | Permalink | Comments (15) | (email story)
June 1, 2009
SocketSite's San Francisco Listed Housing Inventory Update: 6/01/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco decreased a nominal 0.6% over the past three weeks (versus an average decrease of 1.2% for the same three week period over the previous three years) and is now running 10.4% higher on a year-over-year basis (down 6.3% for single-family homes and up 22.4% for condos/TICs) and 44.5% higher than at the same point in 2006.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 5/11/09 [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (102) | (email story)
May 29, 2009
Lembis Look To Cut Another Twelve Loose As Rental Market Drops
"The troubled Lembi real estate empire has put 12 San Francisco apartment buildings up for sale at prices well below what it paid for the properties in 2006 and 2007."
"The buildings the family is attempting to sell include 2185 Bay St., a 24-unit complex the Lembis bought in late 2007 for $7.9 million. The asking price on the building is $5.9 million. Another building, 1305 Lombard St. sold for $2.6 million in 2007 and is priced at $1.9 million. A third property, the 14-unit 2050 Powell St., sold for $3.4 million in 2006 and is priced at $2.9 million."
"David Gruber, who owns 13 multifamily buildings in San Francisco, said rents have dropped 10 percent to 15 percent, and he is seeing an increase in requests for rent adjustments."
∙ Lembis expect to sell apartment buildings for loss [Business Times]
∙ San Francisco Rental Market Weakness: SocketSite Readers Report [SocketSite]
∙ RealFacts Reports (Not So Real) Asking Rents Flat In San Francisco [SocketSite]
Posted by socketadmin at 11:15 AM | Permalink | Comments (23) | (email story)
May 26, 2009
March S&P/Case-Shiller: San Francisco Slide Slows But Continues Fall
According to the March 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 2.2% from February ’09 to March '09, down 30.1% year-over-year and down 46.1% from a peak in May 2006.
For the broader 10-City composite (CSXR), home values fell 2.1% from February to March and are down 33.1% from a peak in June 2006 (down 18.6% year-over-year).
On a positive note, nine of MSAs are reporting a relative improvement in year-over-year returns and nine of the 20 metro areas saw an improvement in their monthly returns compared to February. Furthermore, this is the second month since October 2007 where the 10- and 20-City Composites did not post a record annual decline. Based on the March data, however, we see no evidence that that a recovery in home prices has begun.
San Francisco MSA single-family home prices continued to fall across all three price tiers.
The bottom third (under $268,429 at the time of acquisition) fell 4.6% from February to March (down 37.3% YOY); the middle third fell 2.5% from February to March (down 20.8% YOY); and the top third (over $481,916 at the time of acquisition) fell 3.5% from February to March (down 22.2% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated to April 2000 levels having fallen 61% from a peak in August 2006, the middle third has fallen below March 2002 levels having fallen 42% from a peak in May 2006, and the top third has fallen to April 2003 levels having fallen 30% from a peak in August 2007.
Condo values in the San Francisco MSA fell 6.0% from February ’09 to March '09 (over three times the average of New York, Boston, Chicago and Los Angeles), down 27.3% on a year-over-year basis and down 32.7% from an October 2005 high.
The 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).
∙ The Pace of the Decline in Residential Real Estate Prices Slowed in February [S&P]
∙ February S&P/Case-Shiller: San Francisco MSA Continues Slide [SocketSite]
Posted by socketadmin at 6:15 AM | Permalink | Comments (81) | (email story)
May 22, 2009
San Francisco County Unemployment Dips To 8.8 Percent In April '09
Preliminary April labor force data counts for San Francisco, Marin and San Mateo counties puts the unemployment rate at 8.8%, 7.2% and 8.1% respectively, down 0.2 percentage points from March across the board.
The 9.0% unemploment rate for San Francisco in March represented a 25 year high.
UPDATE: A plugged-in reader adds:
There is an interesting detail on the SF numbers. The number of unemployed in SF fell by 1000 from 40,800 to 39,800. But the number of employed fell by 1300 from 414,200 to 412,900. And the number in the "labor force" fell by 2800, from 455,000 to 452,800.
Looks like a few thousand workers packed up and left SF last month. Re the housing market, easing unemployment would certainly be good, but a smaller workforce would not.
∙ Monthly Labor Force Data for Counties: April 2009 (Preliminary) [EDD]
∙ San Francisco County Unemployment Hits 9.0 Percent In March [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (15) | (email story)
May 21, 2009
San Francisco Recorded Sales Activity In April: Down 33.6% YOY
According to DataQuick, recorded home sales volume in San Francisco fell 33.6% on a year-over-year basis last month (402 recorded sales in April ’09 versus 605 sales in April ‘08) but rose 21.1% compared to the prior month (which seasonality would foretell).
San Francisco continued to experience the sharpest year-over-year decline in sales volume of any Bay Area county in April with San Mateo (-22.5%) and Marin (-19.4%) the only other counties recording declines. San Francisco's median sales price in April was $628,500, down 16.2% compared to April ’08 ($750,000) but up 3.4% compared to the month prior.
For the greater Bay Area, recorded sales volume in April was up 13.1% on a year-over-year basis (a sharp decline from the 32.6% average YOY gain of the past seven months) and up 12.9% from the month prior (7,139 recorded sales in April '09 versus 6,310 in April ’08 and 6,325 in March '09), while the recorded median sales price fell 41.3% on a year-over-year basis, up 4.8% compared to the month prior (the first uptick in 17 months).
Last month’s sales were the second-lowest for an April since 1995 and were 23.2 percent below the average April sales total back to 1988, when DataQuick’s statistics begin.
Foreclosure resales – homes sold in April that had been foreclosed on in the prior 12 months – accounted for 47.4 percent of Bay Area resales. That was down from 50.2 percent in March and 52.0 percent in February. Last month’s figure was the lowest since foreclosure resales were 46.8 percent of existing home sales last November.
A lower concentration of discounted foreclosure resales in the statistics is one reason the median sale price has recently begun to more or less flatten, or at least erode more slowly, in many markets.
At the extreme, Solano recorded a 67.1% year-over-year increase in sales volume (a gain of 288 transactions) on a 43.7% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Bay Area home sales rise again; median price up slightly over March [DQnews]
∙ San Francisco Recorded Sales Activity In March: Down 34.6% YOY [SocketSite]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
Posted by socketadmin at 11:20 AM | Permalink | Comments (45) | (email story)
May 19, 2009
Call It Yet Another "Anecdote" (Or Data Point), It’s Down From 2004
As we wrote in February:
Purchased for $2,000,000 in June of 2004, 2203 Broderick in the heart of Pacific Heights returned to the market with a remodeled bath in October of 2008 asking $2,395,000. Reduced to $2,195,000 in November, and now asking $1,975,000 as of nine days ago.
A sale at asking would represent zero appreciation over the past four and one-half years. But do avoid the temptation to see that as "prices in Pacific Heights have been holding steady since 2004" versus having risen and are now falling since.
Temptation avoided as the single-family 2203 Broderick (with expansion potential) closed escrow on 5/12/2009 with a reported contract price of $1,750,000. That's 12.5% under its sale price in 2004 (which was well below "peak" and didn’t include the remodeled bath).
∙ Apples To Apples (If You Ignore The New Bath): 2203 Broderick [SocketSite]
Posted by socketadmin at 6:00 AM | Permalink | Comments (107) | (email story)
May 18, 2009
While Others Sit The Mayor’s Mini-Manse In The Sky Moves
While the Bay Area high-end market is struggling, at least one high-end and rather high-profile sale is not: the Mayor’s $2,995,000 one-bedroom Bellaire Tower penthouse is now "firmly" in escrow (as in any contingencies have been removed).
∙ Fit For A King San Francisco Mayor (Or Getty): 1101 Green #2001 [SocketSite]
∙ More high-end properties sitting on the market [SFGate]
Posted by socketadmin at 8:00 AM | Permalink | Comments (27) | (email story)
May 15, 2009
QuickLinks: Signs Of Bay Area Economic Life (And Discounts)
∙ Bay Area economy shows signs of life [Business Times]
∙ Spike in San Francisco condo sales may signal comeback [Business Times]
Posted by socketadmin at 5:00 AM | Permalink | Comments (35) | (email story)
The World Market Is Flat!
Earlier this week a sale pair for a Noe Valley condo was submitted by a reader for consideration as an "apple." And while the pair passed our basic test (no major changes to the property between sales), its latest sale on 12/17/08 fell down on another (recency).
Then again, perhaps we’re wrong to believe the market has changed much since the fourth quarter of 2008. (Keep in mind that a mid-December close would suggest a contract that was written in either October or November.)
We have to admit it’s tempting to look at the sales history for 1169 Sanchez, see a sale on 4/11/06 for $775,000 and then again on 12/17/08 for $775,000 and declare the market flat. But that wouldn't be a very accurate depiction of what's actually going on.
And while not perfect, adding a median price per square foot trend line for condo sales in 94114 to the chart of contract prices for 1169 Sanchez should help make the point(s).
Perhaps that market isn’t so "flat" after all (and has actually been trending down since 2007). And looking to a December 2008 apple to understand the May 2009 market might not make too much sense.
Posted by socketadmin at 5:00 AM | Permalink | Comments (31) | (email story)
As Go Condo Values So Goes The Land Upon Which They're Built
"BayRock Residential has slashed the price of its approved condo site on Sutter Street from $18 million six months ago to $8 million, an indication that central San Francisco land prices are catching up with the decline in housing prices the city has seen."
∙ Value of entitled land plunges dramatically in S.F. [San Francisco Business Times]
∙ 1285 Sutter Street: The Proposed Design To Replace The Galaxy [SocketSite]
∙ 1285 Sutter: Fully Entitled, Retail Pre-Leased, And...On The Market [SocketSite]
Posted by socketadmin at 5:00 AM | Permalink | Comments (14) | (email story)
May 11, 2009
SocketSite's San Francisco Listed Housing Inventory Update: 5/11/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 2.5% over the past two weeks (versus an average gain of 4.7% for the same two week period over the previous three years) and is now running 12.1% higher on a year-over-year basis (down 2.9% for single-family homes and up 22.9% for condos/TICs) and 45.5% higher than at the same point in 2006.
The typical spring-time bounce in sales activity known as basic seasonality, but which some seemed to have confused with a market rebound, appears to be moderating. And on a year-over-year basis sales activity in San Francisco remains down.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 4/27/09 [SocketSite]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (51) | (email story)
May 6, 2009
A Plugged-In Reader's "Feel Good" Rental Story (And Shout Out)
A plugged-in reader reports:
A feel good story (for me, not my new landlord).
From reading a large majority of the posts and comments [on SocketSite] and just from walking around Cow Hollow/Marina it was pretty obvious there was a lot of rental supply. My wife and I had outgrown our place and needed either a 2BR or a 1BR w a dining room - we needed 3 rooms plus a kitchen. We figured there would be a lot out there and we would have our choice of solid places. We saw some good places but the one we liked the most was a bit more than we wanted to spend.
Then LMRiM posted something about how asking rents were just that - "asking."
The place we liked had been empty for 2 months. They were asking X. I called up and offered X minus 12%. They told me I wasn't in the ballpark but they would keep me in mind. The place languished, then I saw it on a broker site, so I figured there was room. Then they lowered the rent to X minus 6%. I called em up, put in an app and [we move in soon].
The only thing we'll add, "asking" isn't just for rents.
UPDATE: Another plugged-in reader adds:
Also got a great deal on a house - Noe, single family home w/ great yard for ~3600. The ad that we responded to asked $4000 - funny thing is broker also listed the same place for $5000!!...Apparently bought at 950k, tried to sell at [$1.25M] no takers for some reason.
We'll let you do the math.
Posted by socketadmin at 2:30 PM | Permalink | Comments (29) | (email story)
JustQuotes: Except In San Francisco Of Course...
"There was this unrealistic view that the crazy financing was limited to subprime when of course it was across the board," said Andrew Laperriere, Washington-based managing director at research firm International Strategy & Investment Group. "A lot of jumbo mortgages were nothing down with high debt-to-income ratios."
∙ Rich Americans Default on Luxury Homes Like Subprime Victims [Bloomberg]
Posted by socketadmin at 8:00 AM | Permalink | Comments (34) | (email story)
May 4, 2009
Pending U.S. Home Sales Inch Up, Closed San Francisco Sales Fall
Pending U.S. home sales increased 3.2 percent from February to March (which shouldn’t have caught anybody by surprise) but also increased 1.1 percent higher on a year-over-year basis (3.9 percent and 1.7 percent respectively in the West). Think foreclosures.
At the same time, a plugged-in reader's early count of closed April sales suggests a year-over-year drop in activity of around 40 percent for listed properties in San Francisco.
∙ Pending Home Sales Rise, Housing Affordability Near Record [Realtor.org]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
∙ 465 Hoffman: Architects Unveiling This Evening (And On The Market) [SocketSite]
Posted by socketadmin at 9:30 AM | Permalink | Comments (24) | (email story)
April 28, 2009
SocketSite’s S&P/Case-Shiller Bonus: San Francisco’s Thin Red Line
It’s a SocketSite bonus chart based on February’s S&P/Case-Shiller data for the San Francisco MSA and a chance to focus the discussion on analysis and numbers.
Plotted above, the percentage difference in index value compared to February 2009 for the top third of San Francisco MSA single-family home sales (by price) and all condominiums. Below the thin red line and the index on that date is "underwater" compared to February 2009, over and it’s above.
Once again, according to the Index single-family home values for the top third of the market in the San Francisco MSA have retreated to November 2003 levels having fallen 28% from a peak in August 2007. And Condo values in the San Francisco MSA have retreated to January 2004 levels having fallen 28.4% from an October 2005 high.
A closing thought to consider: according to a 2008 California Association of Realtors survey of 500 first-time home buyers in California, the average buyer planed on holding onto their purchase for just 43.6 months prior to selling.
∙ February S&P/Case-Shiller: San Francisco MSA Continues Slide [SocketSite]
Posted by socketadmin at 12:30 PM | Permalink | Comments (86) | (email story)
February S&P/Case-Shiller: San Francisco MSA Continues Slide
According to the February 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 3.3% from January ’09 to February '09, down 31.0% year-over-year and down 44.9% from a peak in May 2006.
For the broader 10-City composite (CSXR), home values fell 2.1% from January to February and are down 31.6% from a peak in June 2006 (down 18.8% year-over-year).
Looking at the data from peak-thru-February 2009, Dallas has suffered the least, down 11.1% from its peak in June 2007; while Phoenix is down 50.8% from its peak in June of 2006. The rates of decline from the respective peak of each market are evidence of how much each market has given back from the gains earned in the past 10-15 years. All of the 20 metro areas are in double digit declines from their peaks, with ten of the MSA’s posting declines of greater than 30% and seven of those -- Detroit, Las Vegas, Los Angeles, Miami, Phoenix, San Francisco and San Diego -- in excess of 40%.
San Francisco MSA single-family home prices continued to fall across all three price tiers.
The bottom third (under $281,438 at the time of acquisition) fell 3.7% from January to February (down 37.7% YOY); the middle third fell 2.9% from January to February (down 22.4% YOY); and the top third (over $501,978 at the time of acquisition) fell 4.1% from January to February (down 19.4% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated to below June 2000 levels having fallen 59% from a peak in August 2006, the middle third has fallen below April 2002 levels having fallen 40% from a peak in May 2006, and the top third has fallen to November 2003 levels having fallen 28% from a peak in August 2007.
Condo values in the San Francisco MSA fell 1.1% from January ’09 to February '09, down 23.3% on a year-over-year basis and down 28.4% from an October 2005 high.
The 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).
∙ The Pace of the Decline in Residential Real Estate Prices Slowed in February [S&P]
∙ January S&P/Case-Shiller: San Francisco MSA Decline Accelerates [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (88) | (email story)
April 27, 2009
Catching Up On A Few Closings And Early April Apples About Town
We hadn’t originally featured it as an apple but rather an interesting Noe Valley space and photography. But as a plugged-in reader points out, the sale of the contemporary 921 Elizabeth closed escrow on 4/7/09 with a recorded contract price of $1,155,000 or 14.4% under its previous sale price of $1,350,000 in June of 2006.
Other activity over the first few weeks of the month for previously featured apples: 835 Foerster up in Miraloma Park closed escrow with a recorded contract price of $750,000 (21.1% under its previous purchase price of $950,000 in July of 2006), and the bank owned 279 Flournoy closed escrow with a recorded contract price of $340,000 (22.7% under its last previous purchase price of $440,000 in October of 2003).
As we wrote last November when 835 Foerster was listed for $855,000 and the listing noted "Lender-approved short sale...After many months of negotiations, sale price has been set! Must be sold immediately! Property was marketed for $1,049,000 last year!":
[W]hile it’s good to know the seller and lender have come to terms (but perhaps not grips), we’re more interested in whether or not the market (i.e., a buyer) will agree.
Apparently the seller and lender were still off by 12.3%. That’s not too bad, however, when compared to the person who set the list price last year and missed by twice that (28.5%).
∙ A Contemporary Condo That Caught Our Eyes (You Supply The Story) [SocketSite]
∙ While Those Two Agree, It’s A Third That Really Matters [SocketSite]
∙ Bank Owned For The Past Year But Now On The Market: 279 Flournoy [SocketSite]
Posted by socketadmin at 8:00 AM | Permalink | Comments (30) | (email story)
SocketSite's San Francisco Listed Housing Update: 4/27/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased a nominal 0.6% over the past two weeks (versus an average gain of 7.5% for the same two week period over the previous three years) and is now running 12.8% higher on a year-over-year basis (flat for single-family homes and up 21.7% for condos/TICs) and 54.2% higher than at the same point in 2006.
Twenty-three percent fewer listings on a year-over-year basis over the past two weeks is partially to blame for the dip, but we continue to see a slight uptick in potential sales activity albeit much less so than over the first two weeks of the month and without any signs of values stabilizing versus continuing to drop.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 4/13/09 [SocketSite]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (48) | (email story)
April 24, 2009
U.S. New Home Sales Down 31% YOY (West Shows Seasonality)
Purchases of new homes in the U.S. last month fell 0.6 percent to an annual pace of 356,000, down 31 percent from March 2008 and down almost 75 percent from a record pace of 1,389,000 in July 2005. In a show of relative strength (and seasonality), sales in the west increased 15 percent on a month over month basis.
With respect to existing home sales:
A report from the National Association of Realtors yesterday showed purchases of existing homes in March fell 3 percent to an annual rate of 4.57 million. The median price slumped 12 percent from a year earlier, and distressed properties accounted for about 50 percent of all sales.
Mounting foreclosures have drawn more buyers to the existing-home market. New-home sales now make up about 7 percent of the total market, down from about 16 percent at the peak of the housing bubble in mid-2005.
UPDATE: In response to a reader’s comment with respect to new home activity in San Francisco, we offer the following proxy (and perspective). The delta between listed and recorded sales in March 2008: 190. The delta between listed and recorded sales in March 2009: 94. And the year over year change: a 50 percent drop.
∙ Sales of U.S. New Homes in March Exceeded Forecast [Bloomberg]
∙ San Francisco Recorded Sales Activity In March: Down 34.6% YOY [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (7) | (email story)
April 23, 2009
RealFacts Reports (Not So Real) Asking Rents Flat In San Francisco
Based on a RealFacts survey of "professionally managed apartment complexes with 50 or more units," The Chronicle reports that average rents in San Francisco are off by a nominal 0.1 percent on a year-over-year basis and 95.8 percent occupancy (down 1.9 percent).
Unfortunately, and not too ironically, the RealFacts survey reflects the not so real market of asking rather than effective rents (after incentives). And keep in mind that over 700 units of new rental inventory has recently (or will soon) come on line in San Francisco and will need to be absorbed.
That new supply includes 192 units at Strata which offered a plugged-in reader a year of free parking and one month free rent, an effective discount of over 8 percent on a one year lease which wouldn't be reflected in the RealFacts survery of asking rents.
UPDATE: Speaking of incentives and why asking rent trends for large buildings aren’t a great measure of how the rental market is actually moving: "I just got an email from Argenta offering 2 mo free, up from 1 mo. Very nice people, BTW."
∙ Bay Area rents down for second straight quarter [SFGate]
∙ T-Minus Four Weeks For 260 New Mission Bay Apartments (355 King) [SocketSite]
∙ The Scoop On Strata At Mission Bay, Its Environs And Rents [SocketSite]
∙ The Rather Ironic "Argenta Silver Lining": Now Leasing At One Polk [ScoketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (27) | (email story)
April 22, 2009
Actual Q1 San Francisco Foreclosures Fall But Notices Of Default Spike
Bay Area Notices of Default (NODs) in the first quarter of 2009 rose 17.6% on a year-over-year basis, up 35.5% in San Francisco proper (from 420 to 569). NOD activity in San Francisco jumped 88.5% from the fourth quarter (302) as a Fannie Mae and Freddie Mac foreclosure moratorium in the fourth quarter expired on January 31, 2009.
Actual Bay Area foreclosures in the first quarter fell 9.0% on a year-over-year basis (from 6,646 to 6,050) with Contra Costa (down 22.0% to 1,738), Alameda (down 8.0% to 1,681) and Santa Clara (up 24.9% to 1,157) leading the way with respect to volume.
First quarter recorded foreclosures in San Francisco totaled 101, down 18.5% on a year-over-year basis and down 9.8% (11 homes) from the fourth quarter 2008. Once again, however, keep in mind that foreclosure moratorium by Fannie Mae and Freddie Mac.
∙ Golden State Mortgage Defaults Jump to Record High [DataQuick]
∙ Actual San Francisco Foreclosures Down 42% QOQ (Up 70% YOY) [SocketSite]
Posted by socketadmin at 2:45 PM | Permalink | Comments (163) | (email story)
April 17, 2009
No Rebound For You! (In Fact A Below Average Seasonality Bump)
In early March CBS5 reported signs of a "serious real estate rebound" in San Francisco. While we debunked it as basic seasonality, the report was quickly packaged and passed along as gospel by industry folks. And now we have the actual March results.
In 2009 recorded sales volume in San Francisco increased 22% from February to March (45% from January). On average over the past four years, however, recorded real estate sales volume has jumped 44% from February to March (65% from January).
In other words, not only do we see a 34.6% decline in year-over-year sales volume and no rebound, but we also see a below average seasonality bump.
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
∙ CBS Calls It A "Real Estate Rebound In San Francisco" [SocketSite]
∙ San Francisco Recorded Sales Activity In March: Down 34.6% YOY [SocketSite]
Posted by socketadmin at 2:00 PM | Permalink | Comments (37) | (email story)
April 16, 2009
San Francisco Recorded Sales Activity In March: Down 34.6% YOY
According to DataQuick, recorded home sales volume in San Francisco fell 34.6% on a year-over-year basis last month (332 recorded sales in March ’09 versus 508 sales in March ‘08) but rose 22.1% compared to the prior month (think seasonality rather than "rebound").
San Francisco experienced the sharpest year-over-year decline in sales volume of any Bay Area county last month with San Mateo the only other county recording a decline (down 13.2% YOY). And San Francisco's median sales price in March was $608,000, down 19.5% compared to March ’08 ($755,000) and down 5.0% compared to the month prior.
For the greater Bay Area, recorded sales volume in March was up 29.1% on a year-over-year basis and up 25.7% from the month prior (6,325 recorded sales in March '09 versus 4,898 in March ’08 and 5,032 in February '09), while the recorded median sales price fell 45.9% on a year-over-year basis, down 1.7% compared to the month prior.
Once again, think foreclosures and mix.
Last month 51.2 percent of all Bay Area resale homes had been foreclosed on at some point in the prior 12 months, down from 52.0 percent in February and up from 23.2 percent a year ago. By county it ranged from 11.5 percent in San Francisco to 70.0 in Solano.
And financing.
Mortgages for more than $417,000 were used to finance 19.0 percent of the Bay Area's home sales last month, compared with more than 60 percent before the credit crunch hit in late summer 2007.
The use of government-insured FHA loans - a common choice among first-time buyers - represented a record 25.4 percent of all Bay Area purchase loans in March, up from 1.5 percent a year ago.
At the extremes, Solano recorded a 102.8% year-over-year increase in sales volume (a gain of 366 transactions) on a 45.5% decrease in median sales price, while Contra Costa recorded a 68.4% increase in sales volume (a gain of 666 transactions) on a 47.7% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales (versus listed sales) which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Bay Area home sales continue climb, median still below $300K [DQnews]
∙ San Francisco Recorded Sales Activity In February: Down 36.9% YOY [SocketSite]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
∙ CBS Calls It A "Real Estate Rebound In San Francisco" [SocketSite]
Posted by socketadmin at 4:30 PM | Permalink | Comments (56) | (email story)
Global Layoffs Leveling Off But Is It The Eye Of The Economic Storm?
A plugged-in reader’s comment with respect to the global economy that’s worth elevating:
Just heard a snippet of interesting data from law firm that helps companies with layoffs:
Q408: 1.0M layoffs helped with globally
Q109: 1.5M layoffs
Q209: on pace for 100k so far...
Maybe companies are beginning to figure out what normal looks like moving forward.
Either that or we're in the eye of the global economic storm. And in layoff news closer to home, it appears as though Yahoo will cut up to another 600.
∙ SocketSite's San Francisco Listed Housing Update: 4/13/09 [SocketSite]
∙ Yahoo plans to eliminate up to 600 jobs [SFGate]
Posted by socketadmin at 10:00 AM | Permalink | Comments (8) | (email story)
Growing Commercial Concern (And Residential Parallels)
"Of particular concern for San Francisco is the fact that nearly 75 percent of the Class A - premier - office buildings downtown traded hands in the past four years, according to Tove Nilsen, director of market research at Colliers International. The flurry of activity propelled sales prices to record highs and drove the ratio of rental income to cost to all-time lows.
That might have been acceptable when rents were climbing. But the tumbling economy has emptied 1.1 million square feet of space since the beginning of last year and has pushed rents down by 24 percent, according to Colliers. Meanwhile, leases for about 6 million square feet will come up for renewal this year, as will those for more than 10 million square feet in 2010."
∙ Commercial real estate market softens [SFGate]
∙ Pro Forma Problems: Find Commercial, Replace With Residential? [SocketSite]
∙ Co-opting A Reader’s Comment: Our Commercial Market Decline [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (15) | (email story)
April 13, 2009
SocketSite's San Francisco Listed Housing Update: 4/13/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 4.7% over the past two weeks (versus an average gain of 1.9% for the same two week period over the previous three years) and is now running 17.5% higher on a year-over-year basis (up 8.7% for single-family homes and 23.5% for condos/TICs) and 71.3% higher than at the same point in 2006.
Sixteen percent fewer listings on a year-over-year basis for the first two weeks of April are partially to blame for the dip, but an increase in sales activity in the sub-million dollar market over the past two weeks has reduced Active inventory as well. And this time it’s not simply seasonality as our counts suggest as much as a twenty percent year-over-year bump in potential contracts written in early April.
It is, however, way too soon to call it a turn or even simply a trend.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 3/30/09 [SocketSite]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (66) | (email story)
April 8, 2009
Co-opting A Reader’s Comment: Our Commercial Market Decline
As a plugged-in reader commented and we’ve now co-opted, San Francisco’s commercial real estate market continues its decline. A few stats from Bloomberg:
San Francisco office rents dropped 24 percent in the first quarter from a year earlier, the biggest decline since the dot-com crash in 2001.
The office vacancy rate rose to 13.2 percent from 12.6 percent in the previous quarter and up from 10.2 percent a year earlier.
Almost half of the largest companies in the San Francisco Bay Area plan to cut staff in the next six months.
Not good. Unless, of course, you’re a renter looking to expand or renegotiate a lease.
∙ San Francisco Office Rents Fall Most Since 2001 [Bloomberg]
∙ Doesn't Everybody Want To Work Here? (Class A Rents Plunge) [SocketSite]
Posted by socketadmin at 1:30 PM | Permalink | Comments (6) | (email story)
Effective San Francisco MSA Residential Rents Lead U.S. Decline
Effective residential rents in large apartment buildings in the San Francisco MSA declined 2.8% in the first quarter of 2009, the sharpest recorded decline amongst the top 79 U.S. markets. New York recorded a 2.6% decline to take second place and San Jose a 2.5% drop to take third.
According to San Francisco Apartments Association Executive Director Janan New by way of the Examiner, "rents have dropped most in the Marina, Russian Hill and Telegraph Hill neighborhoods, and least in Mission and Inner Sunset."
As outlined in our 2009 residential real estate outlook in January, we expect to see rents in San Francisco continue to drop throughout 2009.
∙ Landlords See a Jump in Vacancy Rates Even as Rents Drop [WSJ]
∙ Bay Area rents fall more than any U.S. region [Examiner]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 9:00 AM | Permalink | Comments (60) | (email story)
April 7, 2009
1470 Noe Closes For 100% Of Asking (But $25,000 Less Than In 2005)
It’s true, we missed it when the apples to apples sale of 1470 Noe recently closed escrow (hey, it happens). But luckily a reader calls us out (and we’d expect nothing less). Purchased for $1,865,000 in January of 2007 (asking $1,949,000 at the time), closed escrow on 3/27/09 with a reported contract price of $1,850,000 (asking at the time).
Considering the current market a two year "push" might not seem so bad for this single-family Noe Valley home. But do keep in mind it’s also an effective four year push in terms of appreciation as Mr. Alou paid $1,875,000 for the house in March of 2005.
∙ 1470 Noe Steps Back Up To The Plate (And A Plugged-In Peek Inside) [SocketSite]
∙ Another On Noe (1470 Noe Street) [SocketSite]
∙ Two Well Designed Data Points We Wouldn't Dismiss Out Of Hand [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (52) | (email story)
April 6, 2009
Mortgage Rates Are Down But Are The "Bad Ways" Picking Back Up?
From a plugged-in reader refinancing a home up in Portland:
We just signed on our refinance (4.625% for 1 point) and we were talking to a woman who worked at the title company and she said things are going right back to the old (bad) ways. People taking mortgages that over extend them financially, brokers pushing through anything they can. She said it is going straight back to how things were before and she wasn't happy about it.
Is it an "only in Oregon" or anomalous report?
Posted by socketadmin at 10:45 AM | Permalink | Comments (18) | (email story)
From Flippy To Floppy For Watermark (501 Beale) Penthouse #2B
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 likley a supporting comp for the flip of #PH2B. And so on. And so forth.
∙ Listing: 501 Beale Street #PH2B (2/2) - $1,094,500 [MLS]
Posted by socketadmin at 7:30 AM | Permalink | Comments (81) | (email story)
April 3, 2009
U.S. Prime Delinquency Rate Doubles, Alt-A Approaches 10%
The delinquency rate for prime mortgages over 60 days behind more than doubled from the first quarter of 2008 (1.1%) to the fourth (2.4%) while serious delinquencies for Alt-A mortgages jumped from 5.18% to 9.1%. For context, the serious delinquency rate for subprime mortgages was 10.75% in the first quarter of 2008 (16.4% in the fourth).
The delinquency rate for prime mortgages in the U.S. has hit an all-time high, yet mortgage rates remain near all-time lows.
∙ Failure Rate Rises on Mortgages Revised in Late 2008, U.S. Says [Bloomberg]
Posted by socketadmin at 6:00 AM | Permalink | Comments (94) | (email story)
April 2, 2009
Apples To Apples With Views, Views, Views! (714 Duncan)
Purchased for $1,413,000 in January of 2008, the four-bedroom 714 Duncan is back on the market in Noe Valley and asking $1,295,000. A transfer forces the sale.
There’s little doubt the quick turn will result in a loss as even with "typical San Francisco appreciation" transaction costs wouldn’t be covered. But that doesn’t mean this data point will be flawed. In fact, this sale will provide some rather clean commentary on changing neighborhood values over just the past year. And that’s why we like, and offer, our apples.
∙ Listing: 714 Duncan (4/2) 2,050 sqft - $1,295,000 [MLS]
∙ Expectation Setting: San Francisco Appreciation [SocketSite]
Posted by socketadmin at 3:00 PM | Permalink | Comments (53) | (email story)
April 1, 2009
A Plugged-In Perspective On The Local Economics Of Medicine
A plugged-in reader’s perspective on the local economics of medicine:
I wanted to comment on the economic decline and which groups are affected. Some sources talk about the medical field being unaffected, but this just isn't true. I'm finishing my specialty training in 2 months, and I can tell you that all of the specialty fellows, GI, Cardiology, Nephrology, Pulmonary, etc. are having trouble finding jobs.
The graduating residents are running into the same thing. The larger employers, like the University of California system and Kaiser, have implemented hiring freezes in a lot of their departments. This applies to support staff as well (nurses, resp therapists, etc), not just MD's. The smaller private groups seem to be doing the same, just not announced "official" freezes. A lot of the older docs are also not retiring to make up for all the money they've lost recently in their 401k's. This increased physician "supply" is also dampening the overall salaries as well.
The relevancy to local real estate? Earnings, wealth and perception. Okay, and a chance to get our Case-Shiller discussion back on track.
∙ January S&P/Case-Shiller: San Francisco MSA Decline Accelerates [SocketSite]
∙ JustQuotes: FIFO Not LIFO For The San Francisco Economy? [SocketSite]
Posted by socketadmin at 10:45 AM | Permalink | Comments (124) | (email story)
Talking About TIC Activity Or The Lack Thereof: 3175 California Closes
A plugged-in reader reports on the sale of 3175 California, a two (plus) bedroom, two bath and 1,140 square foot TIC on the border between upper and Lower Pacific Heights:
3175 California Street (Pac Heights, near the JCC) closed today. It has been on the market since the first week of September [when listed for $739,000]. It opened at 699,000 in December with a new agent, and then was reduced to 649,000 in February. Closed [yesterday] for 610,000.
Top floor with leased parking in the building, closed for $535 per square foot.
∙ RandomRumors Via Trulia Voices: Fractional TIC Financing Drying Up? [SocketSite]
∙ 3175 California [Zillow]
Posted by socketadmin at 7:30 AM | Permalink | Comments (7) | (email story)
March 31, 2009
January S&P/Case-Shiller: San Francisco MSA Decline Accelerates
According to the January 2009 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 4.4% from December ’08 to January '09 and fell 32.4% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 19.4% (having fallen 2.5% from December).
The three worst performing cities, in terms of annual declines, continue to be from the Sunbelt, each reporting negative returns in excess of 30%. Phoenix was down 35.0%, Las Vegas declined 32.5% and San Francisco fell 32.4%. Dallas, Denver and Cleveland faired the best in terms of annual declines down 4.9%, 5.1% and 5.2%, respectively.
Condo values in the San Francisco MSA accelerated their decline falling 5.4% from December ’08 to January '09, down 19.8% on a year-over-year basis and down 27.2% from an October 2005 high.
San Francisco MSA single-family home prices fell across all three price tiers.
The bottom third (under $297,909 at the time of acquisition) fell 4.7% from December to January (down 39.2% YOY); the middle third fell 2.9% from December to January (down 24.8% YOY); and the top third (over $527,385 at the time of acquisition) fell 4.2% from December to January (down 17.9% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated to August 2000 levels having fallen 58% from a peak in August 2006, the middle third has returned to May 2002 levels having fallen 39% from a peak in May 2006, and the top third has fallen to February 2004 levels having fallen 25% from a peak in August 2007.
The 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).
∙ The New Year Didn’t Change the Downward Spiral of Residential Real Estate [S&P]
∙ December S&P/Case-Shiller: San Francisco MSA Ends '08 Down 31% [SocketSite]
Posted by socketadmin at 8:30 AM | Permalink | Comments (169) | (email story)
March 30, 2009
SocketSite's San Francisco Listed Housing Update: 3/30/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco rose 3.3% over the past two weeks (versus an average of 4.7% for the same two week period over the previous three years) and is now running 26.8% higher on a year-over-year basis (up 18.2% for single-family homes and 32.7% for condos/TICs) and 72.6% higher than at the same point in 2006.
Twelve percent (12.1%) of listed inventory in San Francisco is known to either be bank owned (REO) or seeking a short sale including One Rincon Hill (425 1st Street) #2307, 1870 Jackson #701 in Pacific Heights, and 2510 Jackson (which we profiled last year when asking $14,900,000).
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 3/16/09 [SocketSite]
∙ Listing: 425 1st Street #2307 (1/1) - $649,000 [MLS]
∙ Listing: 1870 Jackson #701 (2/2) - $975,000 [MLS]
∙ Listing: 2510 Jackson (7/6.5) - $13,495,000 [MLS]
∙ Fortunes Can Be Fleeting (And Mansions Can Be Foreclosed Upon) [SocketSite]
Posted by socketadmin at 5:30 AM | Permalink | Comments (29) | (email story)
What Happens When The Bay Area Median Drops 59%?
"Underlying all the market changes is the prevalence of bank-owned foreclosures being unloaded at a discount. Two years ago, only 2.6 percent of all existing [Bay Area] homes that changed hands had been foreclosed on in the prior months. This year, more than half of the existing homes that sold in January and February were foreclosures."
∙ Bargain home prices attract investors, novices [SFGate]
Posted by socketadmin at 5:15 AM | Permalink | Comments (5) | (email story)
QuickLinks: January Outlook(s) Versus April Rental Reality
∙ Marcus & Millichap San Francisco Rental Outlook (And Quick Rebuttal) [SocketSite]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
∙ Renters rejoice: Prices falling citywide [San Francisco Examiner]
Posted by socketadmin at 5:10 AM | Permalink | Comments (16) | (email story)
March 27, 2009
RandomRumors Via Trulia Voices: Fractional TIC Financing Drying Up?
We try not to reward bad behavior and the hijacking of a post, but it’s an off-topic comment worth repeating and a question worth clearing up (if you can):
From Real Estate pro Sally Rosenman on the Trulia forums : Sterling Bank is providing fractional loans and they are about it at the moment. Can anyone confirm or refute that fractional TIC loans are drying up? Is Bank of Marin or Circle Bank lending?
UPDATE: A few TIC numbers and trends to ponder as well.
Posted by socketadmin at 3:30 PM | Permalink | Comments (21) | (email story)
March 25, 2009
Coming Soon And An Überprime Data Point To Be: 2306 Broadway
Coming soon and asking $6,495,000 according to Nina Hatvany, it’s a plugged-in tipster that suggests we keep an eye on 2306 Broadway which is currently being prepped for sale.
And while we don’t see a recorded sales price for its purchse in August of 2000, we do see a tax assessed value of $7,648,507 which would suggest a purchase price of roughly $7,000,000 for this big view prime Pacific Heights home eight years ago.
Do keep in mind, however, that the sale of 2306 Broadway won't yield a perfectly clean "apple" as the kitchen has been updated and the master bathroom remodeled since. But it might offer some interesting insight into what’s happening with property values high atop San Francisco as opposed to a throw-away observation like it's still expensive.
Posted by socketadmin at 11:15 AM | Permalink | Comments (67) | (email story)
When Up Is Down: Bay Area Building Permits And U.S. Sales
Bay Area building permit activity rose 111 percent from January to February with 80 percent of the gain attributable to a single 143-unit mixed-use Berkeley project. At the same time, Bay Area permit area activity is down 47 percent on a year-over-year basis.
The pace of U.S. new-home sales also “unexpectedly” increased 4.7 percent from January to February (up 6.6 percent in the West), but fell 41 percent on a year-over-year basis.
In related news, we continue to see seasonality.
∙ Home building permits rise - concerns linger [SFGate]
∙ New-Home Sales in U.S. Rose 4.7% to a 337,000 Pace [Bloomberg]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (3) | (email story)
March 23, 2009
Three Cheers Quotes For Bank Of America’s New Jumbo Loan Program
"Bank of America, the country's largest mortgage lender, is rolling out a large program to finance loans between about $730,000 and $1.5 million, with fixed 30-year rates starting in the upper 5% range. The loans will be available through the bank's retail network and through its Countrywide Home Loans subsidiary."
"Bank of America quotes a minimum [down payment] of 20%....[and the new program] requires hefty liquid resources -- six months of principal, interest, property tax and insurance payments in reserve -- plus fully documented income, solid credit scores and a full appraisal."
UPDATE: A "tipster" beats us to the editorial punch (at least with respect to impact):
Countrywide/B of A has had that product since October of last year. Rates were in the 6% range.
I suspect that the debt to income hurdles are pretty high to get that rate (you'll note they don't mention it...), because it hasn't seemed to change the market that much in the 5 months they've had it.
As we’ve seen with other programs, we expect the Bank of America program to benefit qualified buyers though lower rates but not to have a significant impact on activity or demand.
∙ New supply of 'jumbo' financing in pipeline [LA Times]
∙ Conforming Loan Limits: A Placeholder For Discussion And Analysis [SocketSite]
Posted by socketadmin at 1:30 PM | Permalink | Comments (39) | (email story)
March 20, 2009
685 Units Looking Beyond The Current San Francisco Downturn
"On Rincon Hill, the Emerald Fund is proposing to build 308 units at 333 Harrison St., a project that would include two neighborhood parks. At 430 Main St. and 429 Beale St., a narrow lot sandwiched between the Baycrest condos and a Caltrans yard, Portland-Pacific is proposing to build 113 apartments. The Martin Building Co., meanwhile, is scrambling to put together financing to go forward on two apartment complexes: 179 units at 2235 Third St. and 85 units at 178 Townsend St."
∙ Developers emerge for new San Francisco housing [San Francisco Business Times]
∙ A Plugged-In Reader's 13 Notes On The "PC" Approved 333 Harrison [SocketSite]
∙ 430 Main and 429 Beale Streets - Tell Them To Forget It! [Rincon Hill San Francisco]
∙ 2225-2255 Third Street: What Was (And Hopefully Is) In The Works [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (4) | (email story)
March 19, 2009
San Francisco Recorded Sales Activity In February: Down 36.9% YOY
According to DataQuick, recorded home sales volume in San Francisco fell 36.9% on a year-over-year basis last month (272 recorded sales in February ’09 versus 431 sales in February ‘08) but rose 18.8% compared to the month prior (think seasonality).
San Francisco once again experienced the sharpest year-over-year decline in sales volume of any Bay Area county last month with Marin the only other county recording a decline (down 18.4% YOY). San Francisco's median sales price in February was $640,000, down 13.0% compared to February ’08 ($736,000) but up 13.9% compared to the month prior.
For the greater Bay Area, recorded sales volume in February was up 26.1% on a year-over-year basis but fell a nominal 0.4% from the month prior (5,032 recorded sales in February '09 versus 3,989 in February ’08 and 5,050 in January '09), while the recorded median sales price fell 46.2% on a year-over-year basis, down 1.7% compared to the month prior.
Once again, think foreclosures and mix.
Last month 52 percent of all homes that resold in the Bay Area had been foreclosed on at some point in the prior 12 months, up from a revised 51.9 percent in January and 22.3 percent a year ago.
At the county level, foreclosure resales last month ranged from 12.1 percent of resales in San Francisco to 69.5 percent in Solano County. In the other seven counties, foreclosure resales were as follows: Alameda, 46.2 percent; Contra Costa, 65.1 percent; Marin, 18.9 percent; Napa, 63.1 percent; Santa Clara, 42.9 percent; San Mateo, 31.3 percent; and Sonoma, 57.1 percent.
And financing:
The use of government-insured, FHA loans – a common choice among first-time buyers – represented a record 24.9 percent of all Bay Area purchase loans last month.
Conversely, use of so-called jumbo loans to finance high-end property remained at abnormally low levels. Before the credit crunch hit in August 2007, jumbo loans, then defined as over $417,000, represented 62 percent of Bay Area purchase loans, compared with just 17.5 percent last month.
At the extremes, Solano recorded a 100.4% year-over-year increase in sales volume (a gain of 279 transactions) on a 44.3% decrease in median sales price, while Contra Costa recorded a 70.4% increase in sales volume (a gain of 530 transactions) on a 51.9% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales (versus listed sales) which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
Editor’s Note: We’ve adjusted the y-axis for Median Sales Price on the graph above which now crosses the x-axis at zero (as sales volume always has in months past).
∙ Bay Area home sales climb above last year as median falls below $300K [DQnews]
∙ San Francisco Recorded Sales Activity In January: Down 21.8% YOY [SocketSite]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
Posted by socketadmin at 10:05 AM | Permalink | Comments (46) | (email story)
QuickLinks: The Fed Covers The B-52’s (Legal Tender)
∙ ‘Rambo Fed’ Will Buy Treasuries to Combat Crisis [Bloomberg]
∙ Mortgage Rates May Fall to Lowest Since WWII on Fed Purchases [Bloomberg]
∙ Dollar Rally Crumbles as Fed Ramps Up Printing Press [Bloomberg]
Posted by socketadmin at 8:00 AM | Permalink | Comments (31) | (email story)
March 16, 2009
The SocketSite Reality Check For CBS’s Infamous "42 Offer" Home
While we’ve already debunked the CBS report that a recent uptick in home sales activity is a sign of a "serious real estate rebound" in San Francisco (we’ll call it seasonality and note that San Francisco sales activity continues to fall on a year-over-year basis), we now turn our attention to their infamous "42 offer" home.
Presented by CBS and their cast of "real estate experts" as another "hard fact" to back their report of a rebounding San Francisco real estate market (also touted as a "mini-boom"), we dug up some of our own facts on the Excelsior home. The address is 555 Edinburgh and it was listed for sale at $459,000.
At a reported 1,250 square feet (plus a full basement “with room to expand”) that’s a list price of $367 per square foot. At the same time, according to PropertyShark the median price per square foot for 2009 home sales in 555 Edinburgh’s zip code (94112) currently weighs in at $426. In 2008 the median sales price per square foot was $490, in 2007 it was $542, and in 2006 it was $580.
In other words, 555 Edinburgh was listed at 14% under the 2009 median, 25% below the 2008 median, 32% below the 2007 median, and 37% below the 2006 median. In fact, it was priced right around the 2002 median ($372 per square foot). Even a sale at $100,000 over asking suggests a closing price around the 2004 median ($450 per square foot).
Were the 42 offers on 555 Edinburgh a sign of a "serious real estate rebound" in San Francisco? Once again we’ll say no, it was commentary on pricing. And it's frightening that any industry expert would suggest otherwise.
∙ Listing: 555 Edinburgh (2/1) 1,250 sqft - $459,000 (pending) [MLS]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
∙ SocketSite's San Francisco Listed Housing Update: 3/16/09 [SocketSite]
Posted by socketadmin at 4:30 PM | Permalink | Comments (80) | (email story)
A Plugged-In Reader’s Phantom Inventory Analysis For San Francisco
A plugged-in reader provides some great "phantom inventory" analysis for San Francisco:
I took a look over the weekend at MLS records that went to Expired or Withdrawn status since 2007. To get a unique count by address, I didn't count multiple instances for the same address and then eliminated listings that sold or went Active (or Contingent or Pending) subsequent to the expired or withdrawal date. So the following counts show the number of expired or withdrawn listings since 2007 that have not subsequently been sold and are not currently active (or contingent or pending):
SFH: 1,327
Condo: 2,657
Total: 3,984
Compare these (or add them) to the Active count [shown below]:
SFH: 602 active
Condo: 1,046 active
Total: 1,648 active
This analysis indicates that for every current active listing there are more than two other properties that have been withdrawn from the market (and have not returned) in the past 2 years by discouraged sellers.
Of course listings have always been withdrawn for many reasons - but the total number since 2007 has been about 50% higher than the 2000 - 2006 period.
I agree…that there is a huge "phantom inventory" from discouraged [or] discretionary sellers in addition to those who haven't yet put their properties on the market. Pent-up supply must surely exceed pent-up demand - at least from qualified potential buyers. The 3,984 properties from my analysis would take 20 months to be absorbed at the current sales pace.
Keep in mind that neither our listed count nor our reader's "phantom" count includes unlisted developer inventory.
And at the risk of bringing up our Complete Inventory Index (we know, we know), add another 1500 to 2000 housing units of already constructed but as of yet unsold San Francisco inventory that also needs to be absorbed.
∙ SocketSite's San Francisco Listed Housing Update: 3/16/09 [SocketSite]
∙ SocketSite’s Complete Inventory Index (Cii): Q1 2008 (San Francisco) [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (86) | (email story)
SocketSite's San Francisco Listed Housing Update: 3/16/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco rose 8.7% over the past two weeks (versus an average of 4.3% for the same two week period over the previous three years) and is now running 24% higher on a year-over-year basis (up 8.8% for single-family homes and 34.8% for condos/TICs) and 80% higher than at the same point in 2006.
On the demand side, sales volume over the past two weeks in San Francisco appears to have been off by at least 20% on year-over-year basis despite a much ballyhooed and incorrectly interpreted seasonal uptick in activity.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 3/02/09 [SocketSite]
∙ SocketSite Sees Seasonality (Versus Signs Of A Rebound) [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (22) | (email story)
March 12, 2009
SocketSite Sees Seasonality (Versus Signs Of A Rebound)
We’ve put some DataQuick sales data behind the recent CBS5 "rebound" report to make a simple point. Despite significant discounting in the new development market, the recent "spike" in San Francisco sales activity is being driven by seasonality.
Any industry expert that claims a March spike in sales volume as evidence of a real estate rebound either doesn’t understand the basics of the market or isn’t being entirely forthcoming. We’ll let you decide which is worse.
Well, either that or the San Francisco real estate market "rebounded" in March of 2005. Then again in March of 2006. And again in March of 2007. And again…
∙ CBS Calls It A "Real Estate Rebound In San Francisco" [SocketSite]
Posted by socketadmin at 3:00 PM | Permalink | Comments (65) | (email story)
CBS Calls It A "Real Estate Rebound In San Francisco"
Remember when we promised to point out the bullish signs for the San Francisco real estate market based on good buy side analysis? Well, this isn’t it.
Multiple offers on properties listed below current market? Amazing! Sales up on significant price cuts and seasonality? Shocking! A rebound from the bottom? We'll say no.
UPDATE: And in related news: SocketSite Sees Seasonality (Versus Signs Of A Rebound).
∙ Signs Of Real Estate Rebound In San Francisco [cbs5]
∙ Infinity Sales Update: New Contracts Up But Driven By Discounts [SocketSite]
∙ San Francisco Recorded Sales Activity In January: Down 21.8% YOY [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (108) | (email story)
March 9, 2009
The Good News: Contractors Are Actually Calling Their Clients Back...
"About 25 percent of the San Francisco region's approximately 16,000 building trades workers are out of work, compared with nearly full employment last year, said Michael Theriault, secretary and treasurer of the San Francisco Building and Construction Trades Council." (S.F. construction slows to a crawl)
Posted by socketadmin at 7:30 AM | Permalink | Comments (21) | (email story)
March 6, 2009
U.S. Unemployment Joins San Francisco County In The 8% Club
While the preliminary unemployment rate in San Francisco County hit the 8.0% mark in January, in February it hit 8.1% nationally. From Bloomberg:
The U.S. unemployment rate jumped in February to 8.1 percent, the highest level in more than a quarter century, a surge likely to send more Americans into bankruptcy and force further cutbacks in consumer spending.
Employers eliminated 651,000 jobs last month, the Labor Department said today in Washington. Losses have now exceeded 600,000 for three straight months, the first time that’s happened since the data began in 1939.
Do not underestimate the impact of unemployment on real estate, the brunt of which we believe has yet to be seen.
∙ U.S. Economy: Unemployment in U.S. Surged to 8.1% in February [Bloomberg]
∙ Unemployment In The San Francisco MSA Ticks Up To 7.5% [Socketsite]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (5) | (email story)
March 5, 2009
Local Housing Developer AF Evans Files For Bankruptcy Protection
In what's likely not to be good news for the development of 55 Laguna (at the very least with regard to timing), Oakland based developer AF Evans has filed for Chapter 11 bankruptcy protection citing "plummeting house prices and the credit crunch."
∙ AF Evans Co. files Chapter 11 [San Francisco Business Times]
∙ 55 Laguna: The Plugged-In (And AF Evans) Development Update [SocketSite]
Posted by socketadmin at 4:20 PM | Permalink | Comments (11) | (email story)
Unemployment In The San Francisco MSA Ticks Up To 7.5%
From the Chronicle:
California officials say unemployment rates in the Bay Area jumped in January, reaching 9.4 percent in the San Jose area, 9.2 percent in the East Bay and 7.5 percent in San Francisco and vicinity.
The San Francisco metropolitan area, which includes Marin and San Mateo counties, experienced the mildest rise from December's 6.2 percent, and still has one of the lowest rates in the state.
And in related national news: Mortgage Delinquencies Rise to Record on Job Losses.
UPDATE: County level detail from a plugged-in reader:
Note that SF's unemployment rate is 8.0% (up from 6.5% in December) according to today's release. Marin and San Mateo counties' rates are lower, bring the MSA rate down. So we're "less bad" than the rest of the state, but that is a huge one-month leap.
∙ Bay Area unemployment jumps higher [SFGate]
∙ Mortgage Delinquencies Rise to Record on Job Losses [Bloomberg]
Posted by socketadmin at 12:45 PM | Permalink | Comments (22) | (email story)
Cognitive Listing Dissonance At The Watermark (501 Beale #14D)
Originally listed as a Watermark resale for $1,585,000 last July, from a listing later last year: “Views Galore 501 Beale #14D Offered at $1,499,000 Extraordinary price reduction!”
From a listing after that: “Buyers and Agents, now is the time to take advantage of this price!” Asking $1,399,000 at the time.
From the listing today: “Great Opportunity!! Take advantage of HUGE PRICE REDUCTIONs and 1 yr. HOA concession. Motivated sellers!!” Now asking $1,365,000.
And from public records: purchased for $1,303,500 in September of 2006 (not including any incentives). Cognitive listing dissonance (TM) is the first thing that comes to mind.
∙ Listing: 501 Beale #14D (2/2) - $1,365,000 [MLS]
Posted by socketadmin at 9:00 AM | Permalink | Comments (42) | (email story)
March 4, 2009
Beige Book Results: Economic Conditions Continue To Deteriorate
From the latest Federal Reserve regional business survey (a.k.a. The Beige Book):
Reports from the twelve Federal Reserve Districts suggest that national economic conditions deteriorated further during the reporting period of January through late February. Ten of the twelve reports indicated weaker conditions or declines in economic activity; the exceptions were Philadelphia and Chicago, which reported that their regional economies "remained weak." The deterioration was broad based, with only a few sectors such as basic food production and pharmaceuticals appearing to be exceptions. Looking ahead, contacts from various Districts rate the prospects for near-term improvement in economic conditions as poor, with a significant pickup not expected before late 2009 or early 2010.
As we wrote in April of 2008 when the Twelfth District ("San Francisco") was showing weakness: what does economic activity have to do with real estate? We'll just pretend you didn't ask that question (if for some strange reason you did).
∙ Federal Reserve Bank: Beige Book Summary (March 4, 2009) [federalreserve.gov]
∙ Beige Book Results For The Twelfth District (San Francisco): Flat [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (8) | (email story)
March 3, 2009
U.S. Pending Home Resales Drop 7.7% In January, December Revised
The National Association of Realtors reports a 7.7% January drop in U.S. pending home resales and has revised their originally reported 6.3% gain in December down to 4.8%.
"There are just too many headwinds for homebuyers -- tight credit, mounting job losses and fears of further price declines," said Sal Guatieri, a senior economist at BMO Capital Markets in Toronto. "The housing market is showing no sign of a bottom. This could be the story for the first half of this year."
Sounds familiar. That being said, pending sales increased 2.4% in January for the West but driven by the sale of bank owned homes.
∙ Pending U.S. Home Resales Slump More Than Forecast [Bloomberg]
Posted by socketadmin at 8:00 AM | Permalink | Comments (20) | (email story)
March 2, 2009
Early February Listed Sales Count For San Francisco: Down 35-40%
A plugged-in reader provides the early 2009 count and year-over-year six year history for February sales of single-family homes, condos and TICs in San Francisco.
Expect the final count for 2009 to increase by 15-25 units as records are updated (yielding total listed sales of between 189-199 units), but accounting for even an additional 25 closings it appears that sales volume in San Francisco has dropped at least 36% on a year-over-year basis (versus an 18% drop from 2007 to 2008), and that we'll close out this past February with sales volume down almost 50% from five years before.
At the same time, inventory of listed and available single-family homes, condos and TICs is up 24% on a year-over-year basis (versus a 42% increase from 2007 to 2008) and up 66% over the past three.
As we noted last month, January typically marks the seasonal low point for sales activity and sales counts should climb over the next five months at a faster pace than inventory.
∙ SocketSite's San Francisco Listed Housing Update: 3/02/09 [SocketSite]
∙ Early January Listed Sales Results For San Francisco: Down 34% [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (24) | (email story)
Buffet Calls Shenanigans Shambles (And The Dow Dips Below 7,000)
The Dow Jones Industrial Average has fallen below 7,000 for the first time since 1997 and Warren Buffet has eloquently predicted our economy will remain in "shambles" throughout 2009 (and "probably well beyond"). Now about our outlook...
∙ Buffett Says Economy ‘In Shambles,’ Promises Best Days Ahead [Bloomberg]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (37) | (email story)
SocketSite's San Francisco Listed Housing Update: 3/02/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco rose a nominal 1.1% over the past two weeks (versus an average of 6.6% for the same two weeks over the previous three years) and is now running 24.4% higher on a year-over-year basis (up 11.8% for single-family homes and 33.2% for condos/TICs) and 66% higher at the end of February 2006.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 2/17/09 [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (42) | (email story)
February 27, 2009
Downward Revisions: They're Not Just For NAR These Days
"[U.S. GDP] contracted at a 6.2 percent annual pace from October through December, more than economists anticipated and the most since 1982, according to revised figures from the Commerce Department today in Washington. Consumer spending, which comprises about 70 percent of the economy, declined at the fastest pace in almost three decades."
∙ U.S. Economy Shrank 6.2% Last Quarter, Most Since ’82 [Bloomberg]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 5:45 AM | Permalink | Comments (13) | (email story)
February 24, 2009
December S&P/Case-Shiller: San Francisco MSA Ends '08 Down 31%
According to the December 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 3.8% from November ’08 to December '08 and fell 31.2% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 19.2% (having fallen 2.3% from November).
The seven worst performing cities in terms of year-over-year declines continue to be from the Sunbelt, reporting negative returns in excess of 20%. Phoenix was down 34.0%, Las Vegas reported -33.0% and San Francisco fell 31.2%. Denver, Dallas, Cleveland and Boston faired the best in terms of annual declines down 4.0%, 4.3%, 6.1% and 7.0%, respectively.
Condo values in the San Francisco MSA also continued their decline falling 1.3% from November ’08 to December '08, down 19.8% on a year-over-year basis and down 23.0% from an October 2005 high.
San Francisco MSA single-family home prices fell across all three price tiers.
The bottom third (under $321,066 at the time of acquisition) fell 3.8% from November to December (down 39.0% YOY); the middle third fell 2.5% from November to December (down 25.8% YOY); and the top third (over $561,810 at the time of acquisition) fell 3.4% from November to December (down 15.8% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated to October 2000 levels, the middle third has returned to June 2002 levels, and the top third has fallen to April 2004 levels.
The 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., the greater MSA) and are imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best).
∙ Home Price Declines Closed Out 2008 with Record Lows [S&P]
∙ November S&P/Case-Shiller: San Francisco MSA Down, Rate Levels [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (81) | (email story)
February 23, 2009
Checking In On Two Pacific Heights Apples: 2155 Buchanan Update
Apples-to-apples sales tell us the most about how the market is moving, but non-sales can provide some hints as well.
And while 2155 Buchanan Street #9 is in contract up in Pacific Heights (purchased for $1,000,000 in June 2006, listed for $950,000 in November 2008, last asking $885,000), the listing for the "reduced to sell!" and vacant 2155 Buchanan Street #7 has expired without a sale (purchased for $899,000 in July 2005, listed for $960,000 in August 2008, asking $850,000 at expiration).
Perhaps we’ll soon see a sign in the window for number seven and another unit of rental inventory to be absorbed. We’ll keep you posted on the contract price for number nine.
UPDATE: After 24 hours off the MLS as "expired," the listing for 2155 Buchanan #7 has been turned back on. No adjustment to the price (still asking $850,000) and now an official 186 days on the market (but we'll call it 185).
∙ A Pacific Heights Apple Up In The Tree: 2155 Buchanan #9 [SocketSite]
∙ Another Shot At A Ripening Pacific Heights Apple: 2155 Buchanan #9 [SocketSite]
∙ San Francisco Rental Market Weakness: SocketSite Readers Report [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (18) | (email story)
Grand Opening Liquidation Sale: Signs Of The Times And SF Freeze?
A plugged-in tipster captures the seemingly oxymoronic "Grand Opening Liquidation Sale" sign adorning Bamboo Colony at the base of Potrero Hill. The tipster’s succinct subject line: “It's gonna be a deeeep freeze” [in San Francisco].
UPDATE: A plugged-in reader sets the record straight:
This is just a marketing gimmick. I live close by and I have gone to that store a few times (they carry some decent stuff) and asked about the sign and if they are closing shops. They aren't. They have been opened for a couple of months and they keep getting more furniture every time I go in. The sign has always been there.
As such we're scratching our "signs of the times" designation, but standing behind our tipster's first thought.
Posted by socketadmin at 8:45 AM | Permalink | Comments (30) | (email story)
San Francisco Rental Market Weakness: SocketSite Readers Report
From a plugged-in reader with respect to San Francisco’s rental market:
I do consulting and building inspections for major lenders for commercial properties (apartment buildings over 6 units are considered commercial in SF), and last week I did on site inspections of 8 properties owned by a major SF rental player.
All of the building managers told me that they are not getting any responses at all to new units listed, versus the outlandish amount of emails and phone calls they would receive just a few months back for these same buildings.
These include studios for around $1500 and 1 bedrooms for $1800+, in areas as diverse as Mission, Hayes Valley, and Nob Hill.
The anecdotes are quickly starting to add up. And once again, we expect to see San Francisco rents fall throughout 2009 putting further downward pressure on local housing values as "(E)arnings" fall.
∙ A Rental Market Anecdote From A Plugged-In San Francisco Hipster [SocketSite]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
∙ Bay Area Rents Surge, But Housing P/E Ratio Remains Out Of Line [SocketSite 1/08]
Posted by socketadmin at 8:00 AM | Permalink | Comments (69) | (email story)
February 20, 2009
A Rental Market Anecdote From A Plugged-In San Francisco Hipster
From a plugged-in hipster’s comment:
I have rentals in SF and though it's still pretty easy to fill a vacancy here, the prices are softening. I just re-rented a condo in the [Mission] for $2450 (was getting 2600 before).
Cue our rebuttal to the Marcus & Millichap rental outlook (and our overall outlook as well).
∙ San Francisco Recorded Sales Activity In January: Down 21.8% YOY [SocketSite]
∙ Marcus & Millichap San Francisco Rental Outlook (And Quick Rebuttal) [SocketSite]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (116) | (email story)
February 19, 2009
San Francisco Recorded Sales Activity In January: Down 21.8% YOY
According to DataQuick, recorded home sales volume in San Francisco fell 21.8% on a year-over-year basis last month (229 recorded sales in January ’09 versus 293 sales in January ‘08) and fell 37.4% compared to the month prior. San Francisco once again experienced the sharpest year-over-year decline in sales volume of any Bay Area county last month with Marin the only other county recording a decline (down 7.5% YOY).
San Francisco's median sales price in January was $562,000, down 24.5% compared to January ’08 ($744,000) and down 8.8% compared to the month prior.
For the greater Bay Area, recorded sales volume in January was up 40.8% on a year-over-year basis but fell 26.7% from the month prior (5,050 recorded sales in January '09 versus 3,586 in January ’08 and 6,889 in December '08), while the recorded median sales price fell 45.5% on a year-over-year basis, down 9.1% compared to the month prior.
Once again, think foreclosures and mix.
At the county level, foreclosure resales last month ranged from 16.4 percent of resales in San Francisco to 75.2 percent in Solano County. In the other seven counties, January foreclosure resales were as follows: Alameda, 51.9 percent; Contra Costa, 64.4 percent; Marin, 26.2 percent; Napa, 48.1 percent; Santa Clara, 45.6 percent; San Mateo, 34.1 percent; Sonoma, 55.6 percent.
At the extremes, Solano recorded a 126.7% year-over-year increase in sales volume (a gain of 313 transactions) on a 44.6% decrease in median sales price, while Contra Costa recorded a 99.9% increase in sales volume (a gain of 666 transactions) on a 52.5% drop in median sales price.
As always, keep in mind that DataQuick reports recorded sales (versus listed sales) which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Bay Area home sales top last year again; median drops to $300K [DQnews]
∙ San Francisco Recorded Sales Activity In December: Down 17.8% YOY [SocketSite]
∙ Early January Listed Sales Results For San Francisco: Down 34% [SocketSite]
Posted by socketadmin at 10:50 AM | Permalink | Comments (75) | (email story)
February 18, 2009
The Great Rate Update: What’s The Point Of A Point?
A rate update from Julian Hebron at RPM Mortgage:
Zero-points rates on conforming loans up to $417k and super-conforming loans up to $625,500 have improved to start this week as stocks have sold off and mortgage bonds have rallied—when bond prices rise in a rally, yields (or rates) drop. With the government participating in mortgage bond markets, lenders are pricing more conservatively than market levels might suggest because it’s harder than ever to predict which way markets will move. So we continue to see favorable terms on points: one point gets .625% to .875% lower in rate, so borrowers break even on a one-point buydown in 12-18 months.
And rough 30-year rates with said single point:
Conforming - 4.875% (5.09% APR)
Super-Conforming - 5.375% (5.52% APR)
Jumbo - 6.625 % (6.83% APR)
Posted by socketadmin at 12:00 PM | Permalink | Comments (11) | (email story)
The Slightly Altered Sign Of 161-165 Collingwood (And The Times)
A plugged-in tipster with camera in tow captures the slightly altered sign for 161-165 Collingwood (and of the times). Let's keep the candids coming (tips at socketsite.com).
∙ Perhaps It’s Time For The Hard Stuff: 161-165 Collingwood Cuts Again [SocketSite]
Posted by socketadmin at 9:00 AM | Permalink | Comments (21) | (email story)
February 17, 2009
SocketSite's San Francisco Listed Housing Update: 2/17/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco rose 13% over the past two weeks (versus an average of 1.7% for the same two weeks over the previous three years) and is now running 29.5% higher on a year-over-year basis (up 14.3% for single-family homes and 40.5% for condos/TICs).
Overall listed inventory is up 83% versus February of 2006 while listed sales have continued to trend down (a 49% drop in January versus 2006). Keep in mind that "listed" (or MLS based) inventory counts do not include the vast majority of units in new developments about town and neither do "listed" sales.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 2/02/09 [SocketSite]
∙ Early January Listed Sales Results For San Francisco: Down 34% [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (81) | (email story)
February 13, 2009
An "Exciting New Price" (And Club Initiation) For 3577 Pacific Avenue
Touting an “Exciting new price!” of $5,995,000, the newly renovated 3577 Pacific Ave has just joined our quickly growing high-end million dollar cut club.
That’s assuming you count the three days at which it was originally listed for $7,700,000 (now 22% lower). If not, it’s now only $955,000 (14%) under its last price of $6,950,000.
UPDATE: And from a plugged-in reader, the full floor plan monty (pdf).
∙ Listing: 3577 Pacific Avenue (6/4) - $5,995,000 [MLS]
∙ 4552 19th Street Joins The High-End Half Million Dollar Cut Club [SocketSite]
∙ 3577 Pacific: Inside Its Newly Contemporary Soul (And Market's Mind) [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (23) | (email story)
February 12, 2009
Early January Listed Sales Results For San Francisco: Down 34%
Based on an early count of 142 sales of listed single-family homes, condos and TICs in January, sales volume in San Francisco has dropped 34% on a year-over-year basis (versus a 13% drop from 2007 to 2008), and is down around 60% from four years before.
At the same time, inventory of listed and available single-family homes, condos and TICs is up 20% on a year-over-year basis (versus a 32% increase from 2007 to 2008) and is up 58% over the past two.
In terms of months of listed supply on the market at the end of January, in 2007 the count was 3.4 while in 2009 it was 9.4. Keep in mind, however, that January typically marks the seasonal low point for sales activity and sales counts should climb over the next five months (and at a faster pace than inventory).
CORRECTION: As a plugged-in reader correctly notes, we originally miskeyed the current January 2009 sales count as 162 (corrected above and throughout as 142). We’re triple checking everything else.
∙ SocketSite's San Francisco Listed Housing Update: 2/02/09 [SocketSite]
∙ San Francisco Recorded Sales Activity In December: Down 17.8% YOY [SocketSite]
Posted by socketadmin at 8:00 AM | Permalink | Comments (83) | (email story)
4552 19th Street Joins The High-End Half Million Dollar Cut Club
With a $300,000 cut late yesterday, the recently renovated 4552 19th Street in District 5 joins the high-end million dollar (and over 30%) price cut club. Now asking $2,999,000 or $1,300,000 less than what was expected in October.
Also reduced late yesterday, 3271 Baker Street is now listed for $2,275,000. Hitting the market last July asking $3,395,000, expectations for the recently renovated (hmm...) Marina home have been lowered by $1,120,000 or 33% over the past seven months.
Keep in mind that MLS based industry reports on the state of the San Francisco real estate market now reflect 33 days on the market and a 12% drop from its "original" list price of $2,595,000 in January for 3271 Baker Street.
But hey, what’s six months, $800,000 and 20% between friends?
∙ Listing: 4552 19th Street (6/4.5) - $2,999,000 [MLS] [4552-19thst.com]
∙ Listing: 3271 Baker Street (4/2.5) - $2,275,000 [3271bakerstreet.com]
∙ 4552 19th Street Joins The High-End Half-Million Dollar Cut Club [SocketSite]
∙ Spanish/Mediterranean Flair From Traditional To Modern: 3271 Baker [SocketSite]
∙ Less Great Expectations: 3271 Baker Drops Its New Year Asking 24% [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (43) | (email story)
February 11, 2009
Homeowners In The West "Now Nine Percent Less Delusional!"
While we don’t buy into Zillow’s analytics as accurate measures of any reality (or realty), we can’t argue with the results of their surveys on perception. A recap of their second-quarter 2008 survey of homeowners in the West:
My Home's Value Has Increased Over Past Year: 28%
My Home's Value Has Decreased Over Past Year: 56%
My Home's Value Has Stayed the Same Over Past Year: 16%
And from the fourth-quarter:
My Home's Value Has Increased Over Past Year: 19% (-9% from Q2)
My Home's Value Has Decreased Over Past Year: 70% (+14% from Q2)
My Home's Value Has Stayed the Same Over Past Year: 11% (-5% from Q2)
∙ Perhaps An Apple A Day Would Keep Their Delusions Away... [SocketSite]
∙ Zillow Homeowner Confidence Survey: Q4 2008 [Zillow]
∙ Luckily The Sellers Weren't Looking At Their "Zestimate" [SocketSite]
Posted by socketadmin at 9:00 AM | Permalink | Comments (22) | (email story)
February 9, 2009
JPMorgan Chase’s Jumbo Mortgage Performance And Default Forecast
Highlights of JPMorgan’s latest forecast for Jumbo mortgage performance and defaults:
Losses on so-called hybrid adjustable-rate mortgages backing 2006 and 2007 prime-jumbo securities will reach 8 percent to 10 percent…Losses on prime-jumbo mortgages with completely fixed rates in “recent vintage” bonds will be lower than losses on hybrid ARMs [as] faster prepayments could prevent many future defaults, keeping losses in the 2 percent range, a decrease from last month’s 2.3 percent to 2.8 percent...The share of Alt-A mortgages underlying bonds at least 60 days late, in foreclosure or already turned into seized properties climbed 1.53 percentage points last month to 22.88 percent [while] Defaults on so-called option ARMs rose 2.47 percentage points to 30.96 percent.
∙ JPMorgan Doubles Prime-Jumbo Mortgage Loss Projection [Bloomberg]
Posted by socketadmin at 10:30 AM | Permalink | Comments (10) | (email story)
February 6, 2009
Office Space For Sublease And Unemployment Up In San Francisco
From J.K. Dineen at the San Francisco Business Times with respect to office space:
San Francisco tenants unloaded another 250,000 square feet of unwanted office space onto the market in January, as employers slashed workers and pushed to generate sorely needed cash by subleasing floors in Class A downtown towers.
Companies adding to the avalanche of available sublease space include Charles Schwab, which said Jan. 30 that it would cut 500 to 600 jobs in the first quarter. Schwab is seeking a subtenant for 80,000 square feet at the 1 Montgomery Tower. Also in that building, Thomas Weisel Partners Group is looking to sublease 20,000 square feet on the 35th floor, billed as a “high-end build out with panoramic views.” Other chunks of sublease space coming available include 15,639 square feet of brand-new space at the just completed 555 Mission St. being subleased for $48 a square foot by law firm DLA Piper, and the entire 22nd floor of 345 California St., former UBS space that Cushman & Wakefield is looking to lease for five years at a rock-bottom $27 a square foot.
And with respect to San Francisco unemployment:
The number of unemployed San Francisco residents grew by 10,300 in the fourth quarter of 2008 to 29,500, according to Ted Egan, chief economist for the City of San Francisco. In spite of the fourth-quarter increase, Egan pointed out that the 10,000 jobs eliminated during the final three months of 2008 came in dribs and drabs rather than the sort of en masse layoffs announced in recent days by Charles Schwab and Macy’s, which announced 1,400 San Francisco layoffs on Feb. 1. A loss of 2 million square feet of occupied space equals about 10,000 workers.
“Now we are starting to see major layoffs from major employers,” said Egan. “This is the sign of the recession coming to San Francisco.”
∙ Quarter-million square feet added to S.F. sublease glut [Business Times]
∙ Jones Lang LaSalle Office Outlook For San Francisco And The Valley [SocketSite]
∙ A Virtual Tour Of 555 Mission Street (And Downtown San Francisco) [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (1) | (email story)
The Good News: Stock Futures Rise. The Bad News: The Reason Why.
The good news, U.S. stock futures rose last night. The bad news, the reason why:
U.S. stock-index futures advanced on speculation a government report showing the highest unemployment rate since 1992 will force Congress to pass an economic stimulus package.
∙ U.S. Stock Futures Rise on Optimism Jobs Data to Spur Stimulus [Bloomberg]
∙ U.S. Jobless Rate Soars as Payrolls Plunge by 598,000 [Bloomberg]
Posted by socketadmin at 6:45 AM | Permalink | Comments (7) | (email story)
February 5, 2009
JustQuotes: A Safe Place To Discuss And Debate Mortgage Rates
"The average U.S. rate on a 30-year fixed mortgage rose this week, thwarting Federal Reserve efforts to cut borrowing costs, on investor concern the government will increase spending. The fixed rate increased to 5.25 percent from 5.10 percent last week...The 15-year fixed rate jumped to 4.92 percent from 4.8 percent."
∙ Fixed Mortgage Rate Rises to 5.25%, Freddie Mac Says [Bloomberg]
Posted by socketadmin at 12:00 PM | Permalink | Comments (28) | (email story)
Jones Lang LaSalle Office Outlook For San Francisco And The Valley
The Jones Lang LaSalle outlook for office space in San Francisco:
Downsizing companies paired with sluggish tenant demand will cause downward pressure on rental rates to gain momentum in 2009. Rising vacancy rates, barring an unexpectedly rapid recovery, market fundamentals in 2009 will be downward trending as negative net absorption is expected.
Maturing debt, constrained lending and depreciated asset values will place a number of San Francisco building owners in jeopardy of default, forcing recapitalization or distressed sale transactions. This should present attractive opportunities for buyers with significant pools of equity financing.
And for Silicon Valley:
Although the outlook for the Silicon Valley is grim, the general consensus is that the market is well positioned to weather this downturn. During the tech wreck, the Silicon Valley lost over 231,000 jobs or nearly 21 percent of its workforce. Preliminary estimates have the valley shedding up to 26,000 positions in 2009.
∙ North America Office Report – Q4 2008 (pdf) [joneslanglasalle.com]
∙ Pro Forma Problems: Find Commercial, Replace With Residential? [SocketSite]
Posted by socketadmin at 8:00 AM | Permalink | Comments (8) | (email story)
February 3, 2009
QuickLinks Headline Triptych: And So It Goes In San Francisco
∙ U.S. Consumer Spending Falls for Sixth Straight Month [Bloomberg]
∙ Macy’s to lay off 1,400 at S.F. headquarters [Business Times]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 11:45 AM | Permalink | Comments (37) | (email story)
The Unfinished Façade Of 77 Van Ness (And Its 56 Residential Units)
While the façade isn’t quite finished the scaffolding is down from around 77 Van Ness. Once again, it’s 56 potential condos and 21,000 square feet of commercial/retail for lease, but considering the fate of Argenta and Artani perhaps 56 new rental units instead.
∙ 77 Van Ness Rising (And Our Request For A Rendering) [SocketSite]
∙ Argenta's Confirmed And Artani's Rumored, Will 77 Van Ness Be Next? [SocketSite]
∙ The Scoop: Argenta (1 Polk) On The Market As An Apartment Building [SocketSite]
∙ The SocketSite Scoop And Rumor Confirmed: Artani Suspending Sales [SocketSite]
Posted by socketadmin at 8:30 AM | Permalink | Comments (7) | (email story)
February 2, 2009
SocketSite's San Francisco Listed Housing Update: 2/02/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco rose 11.6% over the past two weeks and is running 19.8% higher on a year-over-year basis (up 8.3% for single-family homes and 28.5% for condos/TICs).
Overall inventory is up 65% versus 2006 while sales continue to trend down.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 1/21/09 [SocketSite]
∙ San Francisco Recorded Sales Activity In December: Down 17.8% YOY [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (21) | (email story)
January 30, 2009
Eviction Moratorium Extended And Freddie Becomes A Landlord
"Freddie Mac and Fannie Mae, the mortgage-finance companies under federal control, are extending by one month a freeze on evictions for homeowners in foreclosure as delinquencies soar in a slumping economy.
Freddie, the second-largest source of U.S. home loan money, said it will now allow renters in homes the company has repossessed to remain using monthly leases at market rates. Homeowners who have lost their houses to foreclosure can also rent the properties back from the company at market rates, McLean, Virginia-based Freddie said today in a statement."
∙ Freddie, Fannie Extend Eviction Freeze Until March [Bloomberg]
∙ Actual San Francisco Foreclosures Down 42% QOQ (Up 70% YOY) [SocketSite]
Posted by socketadmin at 9:15 AM | Permalink | Comments (23) | (email story)
January 29, 2009
JustQuotes: Damn Those Bad News Bloomberg “Bears”
“Prospects for an economic recovery this year dimmed after reports today showed new-home sales collapsed, durable-goods orders slumped and a record number of Americans collected unemployment benefits.” Huh.
∙ U.S. Economy: Sales of New Homes, Durable Goods Orders Tumble [Bloomberg]
∙ SocketSite’s Residential Real Estate Outlook For 2009 [SocketSite]
Posted by socketadmin at 9:30 AM | Permalink | Comments (26) | (email story)
January 28, 2009
JustQuotes: A First (And Second Zero) For The Fed, Not SocketSite
"The Federal Reserve left the benchmark interest rate as low as zero, said it’s prepared to purchase Treasury securities to resuscitate lending and warned inflation may recede too quickly."
“Deflation is an increased worry,” said William Ford, a former Atlanta Fed chief who’s now at Middle Tennessee State University in Murfreesboro. “They have switched from worrying about inflation to being focused on deflation. It is the first time they have talked about that in a straightforward way.”
∙ Fed Keeps Rate Near Zero, Prepared to Buy Treasuries [Bloomberg]
∙ Did Somebody Say Deflation? [SocketSite]
∙ Promoted From Comment To Post: Satchel Does Deflation [SocketSite]
Posted by socketadmin at 2:45 PM | Permalink | Comments (43) | (email story)
Actual San Francisco Foreclosures Down 42% QOQ (Up 70% YOY)
Bay Area Notices of Default (NODs) fell 12% on a year-over-year basis in the fourth quarter of 2008, down 9.6% in San Francisco proper (from 353 to 302). And while the number of new NODs in San Francisco also fell 25% from the third quarter, the lead time changing state law took effect in September is likely to still be skewing the comparisons.
At the same time, actual Bay Area foreclosures rose 68% year-over-year (from 4,573 to 7,677) with Contra Costa (up 48% to 2,310), Alameda (up 64% to 1,681) and Santa Clara (up 120% to 1,347) leading the way with respect to volume.
Fourth quarter recorded foreclosures in San Francisco totaled 112, up 70% on a year-over-year basis but down 42% (80 homes) from the third quarter 2008. Think aforementioned state law (reducing the number of pipeline foreclosures) and last month's foreclosure moratorium by Fannie Mae and Freddie Mac (which was extended through January 31).
Most of the loans that went into default last quarter were originated between October 2005 and January 2007 [versus October 2005 to February 2007 last quarter]. The median age was 29 months, up from 21 months a year earlier.
We continue to move from those who were simply undercapitalized to begin with to those who had a bigger cushion in the bank.
∙ Temporary Drop in California Foreclosure Activity [DataQuick]
∙ Actual San Francisco Foreclosures Up 36% QOQ (191% YOY) [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (54) | (email story)
January 27, 2009
SocketSite’s Residential Real Estate Outlook For 2009
We currently see across the board weakness in San Francisco’s residential real estate market throughout 2009 as economic woes compound the impact of tighter credit markets and a shift in market psychology.
Downturns in residential real estate have traditionally been triggered by a downturn in either the local or national economy. The reality which we’ve foreshadowed for quite some time is that the majority of the current market weakness in San Francisco, the Bay Area, and beyond has been driven by a contraction in the credit markets (the deflation of a credit bubble) and a recent shift in market psychology (the deflation of a speculative bubble). The real impact of a weakening economy is yet to come.
With an economy that generally lags the financial markets by nine to twelve months, the full brunt of October’s melt-down won’t be felt for at least another six months. And we expect to see continued weakness in both consumer and corporate spending over at least the next couple of quarters which will further depress corporate earnings and likely lead to additional layoffs and stoke the real real estate killer, unemployment.
With no discernable recovery in sight, we expect the financial market’s destruction of wealth both real (investments) and potential (options) to continue to drag down the San Francisco residential market throughout 2009, and to weigh particularly heavy on the luxury market.
Historically low interest rates will continue to benefit those who buy, but we don’t see rates alone significantly driving demand in San Francisco, or at least not offsetting the decrease in demand due to stricter lending standards and the loss in wealth. And the supply and absorption of new inventory will continue to put downward pressure on housing throughout the city, and not just District 9 as a limited number of active buyers are drawn from other parts of the city by unemotional (well, for the most part...) developer price cuts.
We believe the real estate flight to quality we called two years ago, and up until recently provided support to the upper end of the market, is waning. And value (versus growth) is the new darling of the ball. Oh, and that rents in San Francisco will fall (further challenging values on a fundamental basis).
Our outlook has nothing to do with emotion (other than with respect to acknowledging the psychological shift in the market). And it’s not to suggest that we don’t see any opportunities, especially when it comes to adding real value. It’s simply perspective to help manage expectations and actions (be it in buying, selling, renting or staying put).
And yes, while we are currently bearish on the market in the near-term, we’ll be the first to point out the real bullish signs. As defined by analysts, not sales agents or the industry.
Posted by socketadmin at 7:30 AM | Permalink | Comments (89) | (email story)
November S&P/Case-Shiller: San Francisco MSA Down, Rate Levels
According to the November 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 3.0% from October ’08 to November '08 and are down 30.8% year-over-year (down 31% in October). For the broader 10-City composite (CSXR), year-over-year price growth is down 19.1% (having fallen 2.2% from October).
All 20 metro areas, and the two composites, posted their third consecutive monthly decline. In addition, eight of the MSAs posted their largest monthly decline on record – Atlanta, Boston, Charlotte, Chicago, Dallas, New York, Portland and Seattle. Although in decline over the past few years, some of these regions have out-performed on a relative basis, when compared to the national average. It is clear, however, that the decline in home prices is affecting all regions regardless of geography or employment opportunities.
Condo values in the San Francisco MSA also continued their decline falling 2.7% from October ’08 to November '08, down 19.2% on a year-over-year basis and down 22.0% from an October 2005 high.
And San Francisco MSA single-family home prices once again fell across all three price tiers.
The bottom third (under $342,467 at the time of acquisition) fell 2.2% from October to November (down 40.2% YOY); the middle third fell 1.6% from October to November (down 26.9% YOY); and the top third (over $591,729 at the time of acquisition) fell 1.9% from October to November (down 14.6% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated to December 2000 levels, the middle third has returned to February 2003 levels, and the top third has fallen to June 2004 levels.
The 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., the greater MSA) and are imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best).
∙ Home Price Declines Continue/Home Prices Indices Set New Record Annual Declines [S&P]
∙ October S&P/Case-Shiller: San Francisco MSA Down Across The Board [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (84) | (email story)
January 26, 2009
JustQuotes: Remember That "Positive" Sales Surprise? Surprise!
"Fannie Mae, the largest source of home-loan money in the U.S., said it will need to tap as much as $16 billion in emergency funds from the U.S. Treasury Department to stay afloat as deterioration in the housing market persists.
Fannie’s planned request, announced today, follows Freddie Mac, which said Jan. 23 that it will need as much as $35 billion more in federal aid. Unprecedented mortgage losses drove the net worth of both companies below zero last quarter, they said in separate securities filings."
∙ Fannie to Tap U.S. for as Much as $16 Billion in Aid [Bloomberg]
∙ U.S. Existing Home Sales Rise on Record Price Slump [Bloomberg]
Posted by socketadmin at 6:30 PM | Permalink | Comments (6) | (email story)
January 23, 2009
An Apple In The "Heights" Of Our Tree: 3444 Washington Reduced
From a plugged-in Sleepiguy when the rather handsome 3444 Washington hit the market last May asking $17,500,000: “This property sold a couple of years ago for 16.5 million.”
From the MLS today: now asking $15,750,000 with an "official" one day on the market.
UPDATE: It appears as though sleepiguy (or his agent) might have been thrown by an asterisk. From a plugged-in FSBO:
MLS shows the 1/31/2006 sale price as $16.5M with an *. Current assessed value is $15.8M - so the actual sale price was probably about $15.2M or so...
Cheers. And something tells us we’ll see another one when this sells (asterisk that is).
∙ Listing: 3444 Washington Street (6/6.5) - $15,750,000 [MLS]
∙ It's Not Often A Listing Can Tout A Private Outdoor Amphitheater [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (26) | (email story)
January 22, 2009
It's Bigger Than Google But Not A Bad Starting Point (And Relevant)
The biotech discussion was too far along to parse it from the rest of the Palms discussion, but we will redirect a reader's no comment comment about Google:
No comments about Google today? Weird. It seems that for every company on the ropes there is at least one that is doing ok. How did they do it? Can they continue?Also appears that a lot of companies in the valley, like Google, are taking steps to actually retain employees instead of shed them (option repricing). Although that usually resets the vesting period it can still do a lot for morale. Thoughts?
∙ A SoMa/Palms Wake Up Call (And Apple): 555 4th Street #401 [SocketSite]
∙ Google Profit Tops Estimates as Web-Ad Sales Rise [Bloomberg]
∙ The Google Chart Of The Day (And A Bit More Foreshadowing) [SocketSite]
Posted by socketadmin at 2:40 PM | Permalink | Comments (52) | (email story)
A SoMa/Palms Wake Up Call (And Apple): 555 4th Street #401
From a reader’s comment on our topic of the Palms (555 4th Street) in July:
So now there are a fair number of 2/2's in Soma for the 600's. Wake me up when we hit the 500's.
Last week 555 4th Street #401 closed escrow with a reported contract price of $599,900 (that's "high $500’s" in sales speak). A 938 square foot two-bedroom/bath condo with parking at the Palms, unit #401 was purchased in October of 2006 for $779,000, returned to the market a year later seeking $850,000, and was asking $674,900 when it closed [see UPDATE below].
That's an apples to apples drop in value of 23% over the past two and one-quarter years, or average annual depreciation of 11%. Are we awake?
UPDATE: Additional color from a plugged-in reader:
FYI, this unit was indeed an REO. Did anyone see it? I did. The guy that was foreclosed on freaked out, ripped out all the kitchen appliances and sold them on craigslist. Nice Bosch appliances, pick 'em up cheap! At $599,900 the unit was actually a pretty good deal, however if the buyer had waited it out a bit I'm sure it would have come down some more. The price had actually been reduced to $599,900, so it sold at asking.
The line from the listing: "Need minor cosmetic works." (Misplaced "s" theirs not ours.)
∙ The Palms (555 4th St.): Secondary Market Slowdown And Short Sale [SocketSite]
∙ The Palms Finds More Inventory And A Resale Hits The Market [SocketSite]
Posted by socketadmin at 5:00 AM | Permalink | Comments (55) | (email story)
January 21, 2009
San Francisco Recorded Sales Activity In December: Down 17.8% YOY
According to DataQuick, home sales volume in San Francisco fell 17.8% on a year-over-year basis last month (366 recorded sales in December ’08 versus 445 sales in December ‘07) but rose 7.6% compared to the month prior. San Francisco once again recorded the sharpest year-over-year decline in sales volume of any Bay Area county last month with Marin a close second (down 14.5% YOY).
San Francisco's median sales price in December was $616,500, down 15.7% compared to December ’07 ($731,000) and down 4.9% compared to the month prior.
For the greater Bay Area, recorded sales volume in December was up 36% on a year-over-year basis and rose 19.7% from the month prior (6,889 recorded sales in December '08 versus 5,065 in December ’07 and 5,756 in November '08), while the recorded median sales price fell 43.8% on a year-over-year basis, down 5.7% compared to the month prior.
Once again, think foreclosures and mix.
Homes that were foreclosed on accounted for 50.0 percent of December's resale activity, up from 46.8 percent in November, and up from 14.0 percent for December a year ago. Foreclosure resales ranged from 12.4 percent in San Francisco last month to 67.7 percent in Solano County.
At the extremes, Solano recorded a 103.6% year-over-year increase in sales volume (a gain of 373 transactions) on a 42.3% decrease in median sales price, while Contra Costa recorded a 84.1% increase in sales volume (a gain of 817 transactions) on a 50% drop in median sales price.
And as always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
∙ Bargain hunting dominates Bay Area home sales in December [DQNews]
∙ San Francisco Recorded Sales Activity In November: Down 29% YOY [SocketSite]
Posted by socketadmin at 11:04 AM | Permalink | Comments (108) | (email story)
SocketSite's San Francisco Listed Housing Update: 1/21/09
Inventory of Active listed single-family homes, condos, and TICs in San Francisco rose 6.1% over the past three weeks and is running 12.9% higher on a year-over-year basis (53% higher versus 2006).
That being said, the plugged-in word on the street is that a significant number of uncounted pocket listings are being circulated (especially in District 7) as agents test the new new market's waters. And as one plugged-in agent notes, only those homes that have to sell are listed right now (something to keep in mind if you’re making an offer).
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 12/29/08 [SocketSite]
Posted by socketadmin at 9:00 AM | Permalink | Comments (49) | (email story)
Marcus & Millichap San Francisco Rental Outlook (And Quick Rebuttal)
The Marcus & Millichap rental outlook for 2009 in San Francisco: rents up 3.3% on 400 new units in professionally managed apartment buildings with at least 20 units.
Our comment (at the risking of stealing a bit of our own outlook thunder): we believe Marcus & Millichap is significantly underestimating both the number and impact of "shadow” market units for rent in San Francisco (which they deem to be “barely a factor”) as well as the effective number of new units for rent that will hit the market in 2009.
∙ Bay Area rental market gives tenants an edge [SFGate]
Posted by socketadmin at 8:15 AM | Permalink | Comments (39) | (email story)
January 20, 2009
JustQuotes: While Treasury Rates Drop, Risk Premiums Rose
"Thirty-year, fixed-rate mortgages averaged 4.96 percent last week, according to McLean, Virginia-based mortgage finance company Freddie Mac, or 2.64 percentage points more than 10-year Treasuries. Before the credit markets began to seize up in the second half of 2007, the difference averaged about 1.78 percentage points since the start of the decade."
∙ Treasury Yields Flattened as Fed Fights to Cut Mortgage Rates [Bloomberg]
∙ That TED Sure Is A Funny Fellow (And Worth Keeping An Eye On) [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (51) | (email story)
January 16, 2009
Cash Flows Catch Up To The Lembi Group
Over the past two weeks 51 San Francisco apartment buildings which had been acquired by the Lembi Group were deeded back to the bank in lieu of foreclosure. The bundle of 1,500 apartments had been losing $3 million a month.
∙ Lembi gives 51 buildings back to UBS [Business Times]
Posted by socketadmin at 7:45 AM | Permalink | Comments (71) | (email story)
January 14, 2009
One Rincon Hill (425 First Street): Rental Market Stumbling As Well?
Following in the footsteps of its “massive price reduction!!!” in December (originally asking $1,399,000, currently asking $999,900), the asking rent for 425 1st Street #1802 has been reduced to $4,200 per month as well (once asking $5,250).
Don’t forget to update those assumptions on your valuation/rent versus buy worksheets.
∙ One Rincon Hill (425 First Street): Secondary Market Stumbles [SocketSite]
∙ Listing: 425 1st Street #1802 (2/2) - $999,900 [MLS]
∙ $4200 / 2br - PRIME VIEW AT ONE RINCON HILL - RENT REDUCED [Craigslist]
∙ Four Floors Lower, But Asking One Hundred And Fifty Thousand Less [SocketSite]
Posted by socketadmin at 8:45 AM | Permalink | Comments (104) | (email story)
January 13, 2009
That TED Sure Is A Funny Fellow (And Worth Keeping An Eye On)
"The difference between the London interbank offered rate, or Libor, that banks say they charge each other for three-month loans in dollars and the yield on the three-month Treasury bill, fell 12 basis points to 98 basis points today. The so-called TED spread last closed below 100 basis points Aug. 15. Dollar Libor dropped to 1.09 percent today, the lowest level since June 2003."
"The three-month dollar Libor is still 84 basis points above the Federal Reserve’s target, compared with an average of 12 basis points in the year before the crisis began. The spread was 332 basis points on Oct. 10, less than a month after the collapse of Lehman Brothers Holdings Inc."
∙ TED Spread Narrows to Least in Five Months as Credit Eases [Bloomberg]
Posted by socketadmin at 7:15 AM | Permalink | Comments (2) | (email story)
January 12, 2009
Less Great Expectations: 3271 Baker Drops Its New Year Asking 24%
As we first wrote about 3271 Baker when it hit the market six months ago (and was staged a bit differently):
While the stucco, tiles, wrought iron railings, doorways, beamed ceilings and wooden trim of both the overhauled façade and second floor of 3271 Baker Street are all true to the traditional Spanish/Mediterranean ethos of the house, the new first floor master suite is a bit more Ibiza (and the kitchen Italian).
And for the record, we’re not complaining (about either the suite, the island or Italy).
Asking $3,395,000 ($1,125 per square foot) in 2008, asking $2,595,000 ($860 per square foot) today. And yes, "two days" on the market (at least according to those MLS reports).
∙ Listing: 3271 Baker Street (4/2.5) - $2,595,000 [3271bakerstreet.com] [MLS]
∙ Spanish/Mediterranean Flair From Traditional To Modern: 3271 Baker [SocketSite]
Posted by socketadmin at 4:15 AM | Permalink | Comments (117) | (email story)
Pro Forma Problems: Find Commercial, Replace With Residential?
From J.K. Dineen at the San Francisco Business Times:
Downtown San Francisco’s weakest year for commercial real estate since 2001 ended with a whimper, with the central business district losing another 1.3 million square feet of occupied space in the fourth quarter of 2008.
For the year, San Francisco’s “negative absorption” — the sum of both space vacated and empty new square footage coming on line — topped 2 million square feet, according to end of the year reports from CB Richard Ellis.
The deluge of newly available office space drove taking rents — the amount that tenants actually pay for space they agree to occupy — down by almost 25 percent, according to an analysis Colliers International did of 93 leases completed in the fourth quarter. The gap between what office landlords are asking and what tenants are willing to pay is widening, according to James Bennett of GVA Kidder Mathews.
“You have a lot of newcomers to the market who bought buildings at astronomical prices who are now having to stomach the fact that their pro forma rents are not going to materialize,” said Bennett. “It will be interesting to see how those owners respond to the down market.”
We're still talking commercial, right?
∙ S.F. tenants pour more space onto market [San Francisco Business Times]
Posted by socketadmin at 4:00 AM | Permalink | Comments (11) | (email story)
January 7, 2009
San Francisco’s “2008 Luxury Tour” Scorecard To Date: No Sales
From ABC's Nightline last night: "Herding the ‘White Elephants': A look at how hard unloading a mega-mansion has become in today’s economy." Shockers. At least to those who aren't plugged-in...
Posted by socketadmin at 7:15 AM | Permalink | Comments (58) | (email story)
Bay Area Notices Of Default: Another Source, The Same Story
"Notices of defaults (the first step in the foreclosure process) and notices of trustee sales (which often but don't always lead to actual foreclosures) reached 525,356 in 15 California counties last year, reported [Default Research Inc]. In the Bay Area counties of Alameda, Contra Costa, San Francisco and Solano, the annual total climbed 180 percent to 85,381."
∙ Report says foreclosures, defaults up in 2008 [SFGate]
Posted by socketadmin at 6:15 AM | Permalink | Comments (4) | (email story)
January 6, 2009
But Hey, What's The Bay Area Economy Have To Do With Real Estate?
"For all of 2008, just six venture-backed companies made their public debut, the worst showing since 1977 when there were also just six VC-backed companies that went public. Preliminary figures show just 260 M&A transactions last year, the first year since 2003 that were less than 300 venture-backed acquisitions.
Venture capitalists unable to cash in on their investments spells big trouble for the entire venture community and the broader Bay Area economy. The venture business is an engine of growth in the Bay Area, which traditionally gets about a third of all venture dollars invested."
∙ Venture-backed IPOs last year hit 30-year low [San Francisco Business Times]
∙ Sequoia’s Take On The New New (And Quite Local) Economy [SocketSite]
∙ From Underwater To Unemployed (And Sorry, But It’s Just Starting) [SocketSite]
Posted by socketadmin at 6:45 AM | Permalink | Comments (110) | (email story)
A Six And One-Half Year District 5 Single-Family Apple On The Tree
Sporting a bit of a sweet deco vibe in the living room, 444 Douglas is back on the market and asking $1,295,000. Purchased for $1,100,000 in August of 2002, a sale at asking would represent average annual appreciation of 2.6% over the past six and one-half bull market years for this solid single-family home in San Francisco's real estate District 5.
And while the sale for $1,100,000 in 2002 closed just 13 months after purchasing the property for $860,000 in 2001, do keeping mind that a bathroom was remodeled, rooms were renovated, and the foundation was bolted in between. But once again, we can't recall anybody discussing the measured appreciation over such short holding periods as being anything but representative of the market at the time (as it was and still is).
∙ Listing: 444 Douglass (3/2.5) - $1,295,000 [MLS]
Posted by socketadmin at 6:30 AM | Permalink | Comments (70) | (email story)
JustQuotes: Can You Say Risk/Default Premium?
"Federal Reserve officials are focused on driving down the spreads between U.S. Treasury yields and consumer and corporate loans, after cutting the main interest rate to almost zero failed to revive lending.
Credit costs for households and businesses haven’t followed yields on government debt lower. Fifteen-year fixed-rate mortgages were at 5.06 percent last week, 2.59 percentage points above 10-year Treasury yields; the spread averaged 0.88 point in 2003, when the Fed slashed rates to 1 percent."
∙ Fed Focuses on Consumer, Corporate Rate Spreads Over Treasuries [Bloomberg]
Posted by socketadmin at 5:00 AM | Permalink | Comments (7) | (email story)
January 5, 2009
Mortgage Rate And Driver(s) Update: January 5, 2009
A quick mortgage rate update from Julian Hebron at RPM mortgage:
Rates open the first full week of the year about the same as they were leading into the holidays. A good 30yr fixed rate target for loans up to $417k is 5% or below, and the target for loans up to $625k is around 5.25%. For loans up to $417k and $625k, we’re close to those targets. Rates for loans from $625k to $1m are mid-6% range.
The Fed announced just before New Year’s that they’ve hired outside money managers to run their $500 billion mortgage bond purchase program and that it will start in January. We’ll likely see another update on timing this week. When that purchasing starts, it will drive bond prices up and rates down. [Editor's Note: They've started.]
The biggest news this week is Friday’s jobs report for December, which calls for 475,00 lost jobs and unemployment going from 6.7% to 7%. And this doesn’t even include post-holiday retail worker layoffs that won’t be captured until next month. It would mark 12 straight months of job losses and about 2.5m jobs lost for 2008. This news can cause rates to drop as investors dump stocks and buy bonds.
UPDATE (1/6): "Longer-term Treasuries fell for a fourth day, pushing yields on 10-year notes to the highest in three weeks, as concern the U.S. will sell record amounts of debt drove investors from the safety of government securities."
∙ All Your Home Loans Are Belong To Us (To Boost Liquidity) [SocketSite]
∙ Treasuries Drop Amid Concern U.S. to Sell Record Amount of Debt [Bloomberg]
Posted by socketadmin at 11:45 AM | Permalink | Comments (13) | (email story)
A Sign Of The Times And A Comp In 2005, So How About In 2009?
Purchased for $550,000 in June of 2004, this Outer Sunset single-family home was flipped eight and one-half months later for $680,000 (an increase of $130,000/23.6%) and established a new neighborhood comparable sale (“comp”) that we can’t recall being dismissed on account of the short holding period or location.
Bought back by the bank this past September for $535,075 this past September, 3004 Ortega is currently listed for $589,900.
∙ Listing: 3004 Ortega (2/1) - $589,900 [MLS]
Posted by socketadmin at 6:30 AM | Permalink | Comments (40) | (email story)
December 30, 2008
October S&P/Case-Shiller: San Francisco MSA Down Across The Board
According to the October 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 4.2% from September ’08 to October '08 and are down 31.0% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 19.1% (having fallen 2.1% from September).
Three of the metro areas have given back, on average, more than 30% of the value of homes since October of last year. Phoenix remains the weakest market, reporting an annual decline of 32.7%, followed by Las Vegas, down 31.7%, and San Francisco down 31.0%. Miami, Los Angeles, and San Diego were close behind with annual declines of 29.0%, 27.9% and 26.7%, respectively.
Condo values in the San Francisco MSA also continued their decline falling 3.1% from September ’08 to October '08, down 17.0% on a year-over-year basis and down 19.8% from an October 2005 high.
And San Francisco MSA single-family home prices once again fell across all three price tiers.
The bottom third (under $361,865 at the time of acquisition) fell 3.5% from September to October (down 42.1% YOY); the middle third fell 2.7% from September to October (down 27.6% YOY); and the top third (over $616,549 at the time of acquisition) fell 2.7% from September to October (down 15.7% YOY).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have retreated to January 2001 levels, the middle third has returned to April 2003 levels, and the top third has fallen to October 2004 levels.
The 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., the greater MSA) and are imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best).
∙ Home Price Declines Worsen As We Enter the Fourth Quarter of 2008 [S&P]
∙ September S&P/Case-Shiller: San Francisco MSA Decline Continues [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (254) | (email story)
December 29, 2008
SocketSite's San Francisco Listed Housing Update: 12/29/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 20.2% over the past two weeks (about average for the end of the year) and is closing out 2008 29.3% higher versus last year (60.1% higher versus 2006).
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 12/15/08 [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (8) | (email story)
Drinking Might Be On The Rise, But Martini Park San Francisco Is Not
A plugged-in (and observant) reader reports:
There has been a sign at Rincon Center for the past 4-6 months saying that a Martini Park bar will be opening in late Fall 2008. Of recent, there is a "for lease" sign in one of the windows (Spear Street side). There is also no reference to a San Francisco location on the company's website. There was several months ago.
Curious if it has died a quite death as a result of the slowing economy. That was the line they gave for closing the location in Texas.
That's probably a good guess, and they wouldn't be alone, but we can't confirm. Readers?
Posted by socketadmin at 9:45 AM | Permalink | Comments (20) | (email story)
Flash Back Forward To Beacon Two-Bedrooms Asking Under $600,000
A tax assed value of just over $750,000; a recorded sale back to the bank three weeks ago for $629,142; and a two-bedroom/bath condo at the beacon that’s now asking $599,900 (and touting “Offers anytime!”). Yes, it's 250 King Street #266 and almost the end of 2008.
∙ Listing: 250 King #266 (2/2) - $599,900 [MLS]
Posted by socketadmin at 8:30 AM | Permalink | Comments (39) | (email story)
December 24, 2008
JustQuotes: Jumbo Premiums For Jumbo Loans
"The average 30-year fixed jumbo loan rate was 7.32 percent on Dec. 22, compared with 5.38 percent for a conforming loan, according to BanxQuote of White Plains, New York.
The difference between them has averaged 2.13 percentage points in December, 10 times the average spread from 2000 to 2006 and above last month’s 1.95 percentage points that was the highest on record."
∙ Jumbo Mortgage Shoppers Get Little Relief From Fed Rate Cuts [Bloomberg]
Posted by socketadmin at 12:15 PM | Permalink | Comments (20) | (email story)
December 23, 2008
JustQuotes: Forget The Hopes, It's Time For Prayer
"Sales of single-family houses in the U.S. dropped in November by the most in two decades and resale prices collapsed at a pace reminiscent of the Great Depression, dashing hopes that the market was close to a bottom."
∙ U.S. Economy: Housing Prices Collapse at Near-Depression Pace [Bloomberg]
Posted by socketadmin at 10:15 AM | Permalink | Comments (69) | (email story)
December 22, 2008
Some "Older Folks" (His Words, Not Ours) Perspective On The Market
Some excerpted perspective from an older experienced plugged-in reader:
Us older folks (48 years myself) have seen this all before. I sold my second home in Santa Monica in 1990 which at that time had the same bubble energy of late 2006 here. I had 6 offers within 48 hours, almost all over listing price, which was 25% more than any other similar home sold for in my neighborhood that year.
Back then L.A. was going through a bubble that reminds me very much of what we see here. The buyer had to hold on until 2000 to be able to finally sell it for what he originally purchased the home for, not more. This was a nice area, north of Montana, with many media stars living nearby and listed architectural gems by noted architects such as Neutra, Wallace Neff, Gordon Kaufman, etc., including at that time the bizarre residence of Frank Gehry. This was the "real Santa Monica".
10 years is a LONG time to have to wait to get your money back...
That it is. Especially if one was sold on "normal" returns or is counting on building equity to fund the purchase of a move-up home.
∙ Perhaps It’s The Market That’s More Unbelievable To Some... [SocketSite]
Posted by socketadmin at 11:30 AM | Permalink | Comments (19) | (email story)
December 19, 2008
Perhaps It’s The Market That’s More Unbelievable To Some...
Purchased for $1,600,000 a year ago 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.
∙ Listing: 214 Arguello Boulevard (4/2.5) - $1,395,000 [MLS]
Posted by socketadmin at 7:15 PM | Permalink | Comments (46) | (email story)
Doesn't Everybody Want To Work Here? (Class A Rents Plunge)
“A new Colliers International report found weighted average rents in the financial district dropped from $56.17 to $41.34 a square foot during the [fourth quarter], a 26.4 percent decline. Across the entire San Francisco market, Class A average rents dropped even more — 28.2 percent from $55.65 to $39.79 a square foot.”
∙ Downtown S.F. office rents plunge by 26% [Business Times]
∙ S.F. office space rent drops 22% [SFGate]
∙ San Francisco Firms Continue To Shed And Sublease Office Space [SocketSite]
Posted by socketadmin at 8:30 AM | Permalink | Comments (11) | (email story)
December 18, 2008
San Francisco Recorded Sales Activity In November: Down 29% YOY
According to DataQuick, home sales volume in San Francisco fell 29.0% on a year-over-year basis last month (340 recorded sales in November ’08 versus 479 sales in November ‘07) and fell 17.9% compared to the month prior. San Francisco recorded the sharpest year-over-year decline in sales volume of any Bay Area county last month.
As always, keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
San Francisco's median sales price in November was $648,000, down 20.5% compared to November ’07 ($814,750) and down 7.3% compared to the month prior.
For the greater Bay Area, recorded sales volume in November was up 12.3% on a year-over-year basis but fell 24.4% from the month prior (5,756 recorded sales in November '08 versus 5,127 in November ’07 and 7,613 in October '08), while the recorded median sales price fell 44.4% on a year-over-year basis, down 6.7% compared to the month prior. Once again, think foreclosures.
At the county level, foreclosure resales last month ranged from 10.0 percent of resales in San Francisco to 63.6 percent in Solano County. In the other seven counties, November foreclosure resales were as follows: Alameda, 44.4 percent; Contra Costa, 63.0 percent; Marin, 22.6 percent; Napa, 40.8 percent; Santa Clara, 38.9 percent; San Mateo, 21.8 percent; Sonoma, 51.6 percent.
At the extremes, Solano recorded a 90.4% year-over-year increase in sales volume (a gain of 283 transactions) on a 37.6% decrease in median sales price, while Contra Costa recorded a 61.9% increase in sales volume (a gain of 544 transactions) on a 49.9% drop in median sales price.
∙ Bay Area median home price sinks to 8-year low; sales up over '07 [DQNews]
∙ San Francisco Recorded Sales Activity In October: Down 21.3% YOY [SocketSite]
Posted by socketadmin at 11:45 AM | Permalink | Comments (140) | (email story)
December 17, 2008
1018-1020 Pine Street: Eight Contemporary Condos Apartments
As we wrote three months ago:
As far as we know, 1018-1020 Pine Street is slated to be eight units (condos) with seven (possibly eight) parking spaces. In terms of any other details, we don't know...But we will keep you plugged-in.
As a plugged-in tipster writes today: "I think I know what might be happening." Another luxury new development is skipping the sales office to go the rental route (currently asking $2800-$4250/mo, parking for $200). At least for now.
∙ 1018-1020 Pine Street: Eight Contemporary Condos Coming Soon [SocketSite]
∙ $3300 / 2br - Luxury condos! 8 Brand New units! MODERN [Craigslist]
∙ The SocketSite Scoop And Rumor Confirmed: Artani Suspending Sales [SocketSite]
∙ The Scoop: Argenta (1 Polk) On The Market As An Apartment Building [SocketSite]
Posted by socketadmin at 4:00 PM | Permalink | Comments (33) | (email story)
QuickLinks: Lower Rates Will Save San Francisco! Oh, Wait A Minute…
∙ The FOMC Speaks (And Not In Tongues): It Ain't Pretty Out There [SocketSite]
∙ U.S. Stocks Fall on Concern Fed Is Running Out of Ammunition [Bloomberg]
∙ Banks Show No Signs of Easing in Step With Fed’s Cuts [Bloomberg]
∙ Mortgage Rates Left in Dust by Treasuries, Failures [Bloomberg]
Posted by socketadmin at 8:15 AM | Permalink | Comments (16) | (email story)
December 16, 2008
Back To The Future Past (And Then Some) For Marquee Building #403
Purchased for $551,000 in May of 2005, 151 Alice B. Toklas Place #403 returned to the market in August of 2008 asking $599,000, a sale at which would have represented average annual appreciation of roughly 2.5% over the past three years.
In September the price on the Marquee building one-bedroom was reduced to $525,000, in October to $475,000, and in November to $425,000 where it remains available today assuming a successful short sale.
We should also mention that the person who sold it for $551,000 in May of 2005 bought it for $415,000 in September of 2002. Perhaps it’s time to include that "not included in sale" chandelier.
∙ Listing: 151 Alice B. Toklas Place #403 (1/1) - $425,000 [MLS]
Posted by socketadmin at 2:00 PM | Permalink | Comments (23) | (email story)
The FOMC Speaks (And Not In Tongues): It Ain't Pretty Out There
"The Federal Open Market Committee decided today to establish a target range for the federal funds rate of 0 to 1/4 percent.
Since the Committee's last meeting, labor market conditions have deteriorated, and the available data indicate that consumer spending, business investment, and industrial production have declined. Financial markets remain quite strained and credit conditions tight. Overall, the outlook for economic activity has weakened further.
Meanwhile, inflationary pressures have diminished appreciably. In light of the declines in the prices of energy and other commodities and the weaker prospects for economic activity, the Committee expects inflation to moderate further in coming quarters."
∙ Federal Open Market Committee Statement: December 16, 2008 [federalreserve.gov]
∙ The Fed Cuts Rates To One Percent To Avert "Prolonged" Recession [SocketSite]
Posted by socketadmin at 11:25 AM | Permalink | Comments (35) | (email story)
If You Want To Live Like An Architect, Do The Your Math (398 Eureka)
It was a plugged-in reader that first connected the dots with regard to the listing of Phil Matthews’ AIA home tour home at 398 Eureka. Asking $2,450,000 in September and then taken "off the market" two weeks ago, it’s another plugged-in reader that points out that the home has been added to the rental pool and is currently asking $6,500 per month.
We’ll let you do your math. And once again, connect the dots.
∙ Listing (for rent): 398 Eureka (3/3.5) - $6,500/mo [398eureka.com]
∙ AIA Tour (And Architect’s) Home Hitting The Market: 398 Eureka [SocketSite]
∙ To Rent Or To Buy, That Is The Question (That Only You Can Answer) [SocketSite]
Posted by socketadmin at 8:30 AM | Permalink | Comments (46) | (email story)
December 15, 2008
SocketSite's San Francisco Listed Housing Update: 12/15/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 14% over the past two weeks (versus an average of 16.1% over the same two weeks in 2006 and 2007) and is currently running 30.5% higher on a year-over-year basis (down 2.8% over the past two weeks) as few new homes are listed and many are withdrawn as we close out the year.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 12/01/08 [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (13) | (email story)
Preaching To The Plugged-In Choir (We Can Only Hope)
The Chronicle and a couple of brokerages seem to have figured out what most plugged-in people have known and have been able to act on accordingly since well before the second half of 2008: real estate values in San Francisco are falling.
The quote from McGuire Real Estate CEO Charles Moore with which we have to agree, "I don't think we've even seen the beginning of this yet." More on that point tomorrow.
∙ S.F. feels the pain of real estate meltdown [SFGate]
Posted by socketadmin at 6:00 AM | Permalink | Comments (202) | (email story)
December 10, 2008
Chelsea Park Christmas Special (But Lump Of Coal If It's Your Comp?)
It’s a “Christmas special!” at Chelsea Park as the list price for 3620 19th Street #26 has just been reduced to $799,000 (previously listed for $899,000).
Originally asking $949,000 for this 1,332 square foot three-bedroom, two-bath condo, the reduction might seem more like a lump coal, however, if considered to be your comp.
∙ Listing: 3620 19th Street #26 (3/2) - $799,000 [MLS]
∙ Changing Chelsea Park Expectations Versus Eleven Months Ago [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (8) | (email story)
December 9, 2008
The Economic (And Employment) State Of San Francisco: Not Good
From the Examiner with regard to the economic state of San Francisco:
The City is facing a fiscal “crisis,” with one of the largest deficits in San Francisco history expected in the next year, Mayor Gavin Newsom said Monday, adding that hundreds of layoffs could be announced as soon as Tuesday.
And with respect to employment (or lack thereof):
Unemployment in The City hit the 6 percent mark for the first time since June 2004, according to the [Controller’s Office October economic barometer report], which stated that “most indicators continue to show accelerating weakness in San Francisco’s economy.”
Stating the obvious as some like to say (but yet somehow seem to be missing), the economy, employment and real estate prices tend to be correlated. And it's not looking good.
∙ Mayor: City's budget situation 'legitimately a crisis' [San Francisco Examiner]
∙ From Underwater To Unemployed (And Sorry, But It’s Just Starting) [SocketSite]
Posted by socketadmin at 4:30 AM | Permalink | Comments (119) | (email story)
Chinese To Raid San Francisco (And Lose Like In Germany?)
It reads more like a press release than a serious report, but a reader directs us to the "Chinese property hunters to raid US" piece in the Financial Times. The counterpoint:
“Unless these people need a house in the US to live in, this is senseless,” said Yi Xianrong, a real estate expert at the Chinese Academy of Social Sciences. “A few years ago there was a lot of talk about investing in German real estate but most of the people who did so lost a lot of money.”
Ah, those mythical foreign saviors.
∙ Chinese property hunters to raid US [Financial Times]
∙ Recap: What’s The Scoop On Foreign Investment In San Francisco? [SocketSite]
Posted by socketadmin at 4:00 AM | Permalink | Comments (9) | (email story)
December 8, 2008
JustQuotes: Why Simply Reducing Rates Won't Cure The Market's Ills
"Almost 53 percent of borrowers whose loans were modified in the first quarter of this year re-defaulted by being more than 30 days overdue..."
∙ Majority of Modified Loans Fail Again, Regulator Says [Bloomberg]
Posted by socketadmin at 9:45 AM | Permalink | Comments (46) | (email story)
December 5, 2008
Once Again, We'll Posit It's Just Starting (Not To Mention Matters)
"Skittish employers slashed 533,000 jobs in November, the most in 34 years, catapulting the unemployment rate to 6.7 percent, dramatic proof the country is careening deeper into recession."
"The unemployment rate would have moved even higher if not for the exodus of 422,000 people from the work force. Economists said many of those people probably abandoned their job searches out of sheer frustration. In November 2007, the jobless rate was at 4.7 percent."
∙ Employers cut 533K jobs in Nov., most in 34 years [SFGate]
Posted by socketadmin at 7:45 AM | Permalink | Comments (41) | (email story)
December 3, 2008
JustQuotes: And Housing? Uhh...No.
“What we’ve seen since mid to late September is that business activity has shut down, along with the consumer,” Stephen Gallagher, chief economist at Societe Generale in New York, said in an interview with Bloomberg Television. “There is no reason for an immediate turnaround; financial markets have not stabilized; consumers have not stabilized.”
∙ U.S. Economy: Service Companies Shrink at Record Pace [Bloomberg]
Posted by socketadmin at 9:45 AM | Permalink | Comments (20) | (email story)
U.S. Mortgage Applications Surge With Refi's Leading The Way
While mortgage application volume surged 112 percent last week following the Fed’s "we pay cash for your debt" announcement, refi’s accounted for the bulk of the movement jumping 203 percent versus 38 for purchase.
∙ U.S. MBA’s Mortgage Applications More Than Doubled Last Week [Bloomberg]
∙ It's Like The Fed (And Taxpayers) Just Bought You A Couple Of Points [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (59) | (email story)
December 1, 2008
QuickLinks: While The Cost Of Capital Drops, Availability Does As Well
∙ Treasury Yields Drop to Record Lows as Bernanke Cites Buybacks [Bloomberg]
∙ U.S. Consumers Seen Facing ‘Liquidity Squeeze’ [Bloomberg]
Posted by socketadmin at 4:00 PM | Permalink | Comments (22) | (email story)
JustQuotes: A Short Sale Narrative That Sounds Awfully Familiar
“Here's the common narrative: A home goes on the market as a short sale - priced at less than is owed on the mortgage, so the lender must approve any sale. The bank either declines offers as too low or takes months to decide, which drives away potential buyers.”
∙ Be persistent during ordeal of short sale [SFGate]
∙ Did We Mention How Much That Third Party Matters? [SocketSite]
Posted by socketadmin at 6:40 AM | Permalink | Comments (3) | (email story)
SocketSite's San Francisco Listed Housing Update: 12/01/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 8.6% over the past two weeks (versus an average of 11% over the same time two weeks in 2006 and 2007) but is now running 33.3% higher on a year-over-year basis (up 4.9% over the past two weeks).
At the same time, listed sales activity is down dramatically on a year-over-year basis. And once again, it’s another new record with respect to the percentage of listings that have undergone at least one price reduction (currently 44.7% of all listings versus 31.6% at the same time in 2007 and 29.3% in 2006).
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 11/17/08 [SocketSite]
∙ Early San Francisco Sales Numbers For November: Down Almost 50% [SocketSite]
Posted by socketadmin at 6:40 AM | Permalink | Comments (14) | (email story)
November 25, 2008
New S&P/Case-Shiller Condo Price Index: San Francisco MSA Falling
According to the newly released S&P/Case-Shiller Condo Price Index, condo values in the San Francisco MSA fell 3.3% from August ’08 to September '08, are down 15.0% on a year-over-year basis, have fallen 17.2% from a high in October 2005, and have dipped below levels last seen in October 2004.
The SocketSite S&P/Case-Shiller condo footnote: The Condo Price Index includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA) and is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best).
∙ S&P Launches Condo Indices; Adds Seasonally-Adjusted Data [S&P]
∙ September S&P/Case-Shiller: San Francisco MSA Decline Continues [SocketSite]
Posted by socketadmin at 7:00 PM | Permalink | Comments (63) | (email story)
It's Like The Fed (And Taxpayers) Just Bought You A Couple Of Points
"U.S. mortgage rates fell more than three-quarters of a percentage point today after the Federal Reserve said it will buy as much as $600 billion of debt."
∙ U.S. Mortgage Rates Fall on $600 Billion Fed Plan [Bloomberg]
∙ As Lenders (And Consumers) Hoard, The Fed Commits Another $800B [SocketSite]
Posted by socketadmin at 3:00 PM | Permalink | Comments (7) | (email story)
Early San Francisco Sales Numbers For November: Down Almost 50%
Last week we calculated a 38% single week decline in San Francisco listed sales volume with inventories up 28.4% year-over-year. And now according to a plugged-in reader, listed sales volume in San Francisco for the month of November is currently running 47% lower on a year-over-year basis based on early counts for the first three weeks of the month, while the median sales price has fallen 15% (now in line with 2004).
∙ SocketSite's San Francisco Listed Housing Update: 11/17/08 [SocketSite]
Posted by socketadmin at 12:15 PM | Permalink | Comments (20) | (email story)
Did We Mention How Much That Third Party Matters?
From the plugged-in listing agent for 835 Foerster:
We received an offer several months [ago] for $855,000. It took months to negotiate this sale price with the lenders (both a 1st and a 2nd), not to mention other costs such as back taxes, expenses, commissions, etc., etc...
The lenders unfortunately took too long to approve the payoff (and their losses), and the buyers just pulled out of the deal, citing personal and financing reasons. So yes, the lenders did approve the $855,000 price, but since the contract was submitted several months ago, we've experienced a big market shift.
We lowered to asking price to $788,000 [yesterday] and hope to take a new offer(s) to the lenders, and re-open negotiations.
As we said, while a seller and lender might agree, it's that third party (i.e., the buyer) that really matters. Once again, purchased with loans totaling $950,000 in July of 2006 up in Miraloma Park (District 4). And as always, thank you for plugging in.
∙ Listing: 835 Foerster (3/2.5) - $788,000 [MLS]
∙ While Those Two Agree, It’s A Third That Really Matters [SocketSite]
Posted by socketadmin at 9:30 AM | Permalink | Comments (13) | (email story)
"Foreign Buyers" Never Materialized And Now Tourist Dollars Decline
“The dollar’s resurgence, as well as a drop in home and stock values outside the U.S., will discourage foreign shoppers into next year as the global financial crisis intensifies, [Stifel Nicolaus & Co. analyst David Schick] said. He estimates sales will decline 8 percent at Tiffany’s Fifth Avenue store in New York in the third and fourth quarters, versus gains of 25 percent and 10 percent a year earlier.”
∙ Saks, Neiman May Slump More as Tourist Spending Slows [Bloomberg]
∙ Recap: What’s The Scoop On Foreign Investment In San Francisco? [SocketSite]
Posted by socketadmin at 9:15 AM | Permalink | Comments (4) | (email story)
September S&P/Case-Shiller: San Francisco MSA Decline Continues
According to the September 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 3.9% from August ’08 to September '08 and are down 29.5% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 18.6% (having fallen 1.9% from August).
Phoenix was the weakest market, reporting an annual decline of 31.9%, followed by Las Vegas, down 31.3%, and San Francisco at -29.5%. Miami, Los Angeles, and San Diego did not fair much better with annual declines of 28.4%, 27.6% and 26.3%, respectively.
Prices continued to fall across all three price tiers in the San Francisco MSA.
The bottom third (under $386,320 at the time of acquisition) fell 3.1% from August to September (down 43.2% YOY); the middle third fell 2.2% from August to September (down 27.3% YOY); and the top third (over $647,565 at the time of acquisition) fell 1.2% from August to September (down 14.4% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have retreated to March 2001 levels, the middle third has returned to July 2003 levels, and the top third has fallen to January 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI above only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ National Trend of Home Price Declines Continues Through the Third Quarter of '08 [S&P]
∙ August S&P/Case-Shiller: San Francisco MSA Decline Accelerates [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (38) | (email story)
November 24, 2008
The Latest Cow Hollow Condo Comp (And Apple) Closes Escrow
What plugged-in people have known for a week, all agents on the MLS now know as well: 1968 Greenwich officially closed escrow on 11/21/08 with a reported contract price of $1,750,000.
Purchased for $2,100,000 in May of 2005, in addition to $350,000 in acquisition cost our plugged-in buyer will be saving (and the City will be losing) approximately $4,000 a year in property taxes as compared to the party who sold.
The sale of this property was considered a legitimate neighborhood "comp" (comparable sale) in 2005. The implications for today?
∙ A Plugged-In Reader Picks An Apple For Himself (1968 Greenwich) [SocketSite]
∙ A Renovated Cow Hollow Apple On The Tree: 1968 Greenwich Street [SocketSite]
Posted by socketadmin at 4:30 PM | Permalink | Comments (19) | (email story)
November 21, 2008
Tough Times For The Fledgling Fillmore Jazz District's Rebirth
"Thus far, four nightlife establishments that received funding from the [San Francisco Redevelopment Agency] — Yoshi’s, 1300 On Fillmore, Sheba Lounge and Rassales — have all approached the agency looking for additional loans and to restructure debt to survive what may be a prolonged economic recession. All four businesses are seeing revenues 10 percent to 20 percent below projections, according to the memo."
∙ Fillmore businesses ask redevelopment agency for loans [San Francisco Business Times]
Posted by socketadmin at 12:30 PM | Permalink | Comments (19) | (email story)
JustQuotes: As Come Commercial Realities, Will Go Residential?
"Next year, we're going to have the sublease swap meet of the century," said David Klein, a partner with San Francisco brokerage firm NAI BT Commercial. "Sublessors competing for the same tenant (will) all say, 'I can do the deal cheaper than you,' and the landlords will be playing catch-up. It's the harsh reality of a recession."
∙ WaMu to shut Pleasanton center, cut 1,600 staff [SFGate]
Posted by socketadmin at 7:15 AM | Permalink | Comments (5) | (email story)
Getting A Bit Moody About The Delinquency Trends For Alt-A Loans
From a HousingWire via a plugged-in tipster:
Severe delinquencies on recent-vintage Alt-A RMBS are quickly getting worse than expected, Moody’s Investors Service said earlier this week; the rating agency said worsening trends in Alt-A have forced it to undertake a revision of lifetime loss projections for 2006 and 2007 vintages, as a result. Moody’s last revised its loss expectations for the Alt-A sector six months ago.
As of Oct. 2008, serious delinquencies for Alt-A pools — including option ARMs — averaged 20.3 percent of current balance for the 2006 vintage and 17.5 percent for the 2007 vintage, up from 16.9 and 12.2 percent six months ago. At the same time, prepayment rates on these pools are at historical lows and are currently averaging in the mid to high single digits, Moody’s noted. Serious delinquencies refers to mortgages more than 60 days in arrears, in this case.
(In plain English, and keeping things simple: the prepayment picture here is important. Delinquencies as a percentage of current balance can go up as a matter of course as a loan pool seasons and borrowers prepay, and revintage, themselves. By stressing here that prepayments aren’t just low, but really low, Moody’s is saying that this statistical artifact is not driving the rise.)
While cumulative losses have not yet risen as steeply as delinquencies, many pools are starting to show a sharp increase in the rate of loss realization, according to Moody’s. And as the pace of liquidations has picked up, the performance data suggests worsening loss severities, as well.
∙ Alt-A Losses Outstripping Expectations, Moody’s Says [HousingWire]
∙ Subprime And Alt-A Statistics By County: The Feds Mortgage Map [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (8) | (email story)
November 20, 2008
San Francisco Recorded Sales Activity In October: Down 21.3% YOY
According to DataQuick, home sales volume in San Francisco fell 21.3% on a year-over-year basis last month (414 recorded sales in October ’08 versus 526 sales in October ‘07) and fell 9.6% compared to the month prior. San Francisco was the only Bay Area county to record a year-over-year sales volume decline.
Keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
San Francisco's median sales price in October was $699,000, down 12.1% compared to October ’07 ($795,000) but rose 3.6% compared to the month prior.
For the greater Bay Area, recorded sales volume in October was up 38.8% on a year-over-year basis and increased 4.7% from the month prior (7,613 recorded sales in October '08 versus 5,486 in October ’07 and 7,271 in September '08), while the recorded median sales price fell 40.6% on a year-over-year basis, down 6.3% compared to the month prior. Once again, think foreclosures.
At the county level, foreclosure resales ranged from 10.6 percent of resales in San Francisco to 68 percent in Solano County. In the Bay Area's other seven counties, October foreclosure resales were as follows: Alameda, 41.1 percent; Contra Costa, 58.9 percent; Marin, 17.2 percent; Napa, 45.6 percent; Santa Clara, 36.4 percent; San Mateo, 21.6 percent; Sonoma, 49.7 percent.
At the extremes, Solano recorded a 141.1% year-over-year increase in sales volume (a gain of 436 transactions) on a 38.7% decrease in median sales price, while Contra Costa recorded a 86.7% increase in sales volume (a gain of 877 transactions) on a 46.3% drop in median sales price.
∙ Bay Area median price tumbles to $375K; sales reach high for '08 [DQNews]
∙ San Francisco Recorded Sales Activity In September: Down 2.3% YOY [SocketSite]
Posted by socketadmin at 1:00 PM | Permalink | Comments (38) | (email story)
From “Very” To “Extremely” For The Seller, Decoder Ring On The Way
Purchased in March of 2002 for $975,000 but then "extensively remodeled" in 2003, 1821-23 Lyon was listed two months ago for $3,295,500, reduced a month later to $2,995,500, and then cut to $2,695,000 the day before yesterday.
According to the listing(s), the seller of has gone from being very to extremely motivated (don't worry, a SocketSite decoder ring is on the way). And “OMC2” you ask? Owner may carry second (and not to be confused with OMD, they are back together you know).
∙ Listing: 1821-1823 Lyon (5/3.5) - $2,695,000 [McGuire] [MLS]
∙ A SocketSite Guide To Price Reductions [SocketSite 3/06]
Posted by socketadmin at 6:00 AM | Permalink | Comments (26) | (email story)
The Seven Year Itch Low: San Francisco Business Optimism Falling
"Businesses in San Francisco have been hit hard by the global economic malaise, with new figures showing Bay Area business optimism has sunk to new lows and more than one-third of companies in The City expect to shed staff [but 18% to add] before June."
In San Mateo, 48% of the firms surveyed by the Bay Area Council expect to cut jobs in the next six months, while 14% expect to add.
And in terms of when a recovery will begin, 59% of those surveyed in San Francisco are currently forecasting in one to two years, with 73% of those in San Mateo responding the same.
∙ Bay Area businesses reeling from global downturn [San Francisco Examiner]
∙ Once Again, It's Just Getting Starting (And It's Going To Last Longer) [SocketSite]
Posted by socketadmin at 5:30 AM | Permalink | Comments (0) | (email story)
November 19, 2008
Did Somebody Say Deflation?
From the New York Times today:
In another sign that the struggling economy continues to slow, consumer prices tumbled by a record amount in October, carried lower by skidding energy and transportation prices, raising the specter of deflation.
From a plugged-in reader's comment we promoted last year:
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...
It's good to be plugged-in.
∙ Consumer Price Decline Prompts Fear of Deflation [New York Times]
∙ Promoted From Comment To Post: Satchel Does Deflation [SocketSite]
Posted by socketadmin at 12:15 PM | Permalink | Comments (130) | (email story)
Hanley Woods New Condo Stats For San Francisco: Values Falling
A plugged-in tipster quotes the latest Hanley Woods “New Homes Executive Summary”:
Attached Townhomes and Condominiums: San Francisco County (3rd Quarter 2008)
Change in Median Sales Price: +10.5% YOY
Change in Median Square Feet: +22.9% YOY
Change in Median Sales Price Per Square Foot: -10.1% YOY
Change in Average Sales Price: -3.7% YOY
Change in Average Square Feet: +3.7% YOY
Change in Average Sales Price Per Square Foot: -5.5% YOY
As we’ve been saying about those medians for quite some time, think mix. And for those who frequently confuse an increasing median with increasing value, think again.
UPDATE: A point of clarification and emphasis, Hanley Woods data is based on new units available for sale, not those which have already sold.
Posted by socketadmin at 9:00 AM | Permalink | Comments (7) | (email story)
U.S. Homebuilder Confidence: At Least It Can't Go Too Much Lower...
The bad news:
Confidence among U.S. homebuilders in November dropped to the lowest level since record-keeping began in 1985, a sign that the deepening credit crisis is preventing prospective buyers from purchasing new homes.
The good news:
The National Association of Home Builders/Wells Fargo index of builder confidence decreased to 9, lower than forecast, from 14 in October, the Washington-based association said [yesterday]. A reading less than 50 means most respondents view conditions as poor.
How's that the good news? It can only fall another nine points...
∙ Homebuilder Confidence in U.S. Drops to Record Low [Bloomberg]
Posted by socketadmin at 7:30 AM | Permalink | Comments (15) | (email story)
November 18, 2008
Once Again, It's Just Getting Starting (And It's Going To Last Longer)
"From a Bay Area view, the global slowdown threatens tech exports and tourism, which have so far cushioned San Francisco and the Silicon Valley from the housing bust that has already clobbered the East Bay..."
∙ Economists say recession is here, and will last [SFGate]
∙ The Google Chart Of The Day (And A Bit More Foreshadowing) [SocketSite]
∙ From Underwater To Unemployed (And Sorry, But It’s Just Starting) [SocketSite]
∙ And Speaking Of Being Plugged-In To Bay Area Employment Trends… [SocketSite]
Posted by socketadmin at 6:45 AM | Permalink | Comments (15) | (email story)
November 17, 2008
Which Five Years Will The Next Five Most Likely Resemble Redux
As we wrote a little over a year ago:
213 Moulton is a contemporary single-family home situated down a little alley in Cow Hollow. It first sold for $545,000 in 1995. And ten years later (in 2005) it changed hands for $1,672,000. No doubt about it, that's fantastic long-term appreciation. Then again, it also changed hands in the year 2000 for $1,600,000.
We only mention it now as 215 Moulton (part of the same three home development) has been on the market for a month and has recently reduced its list price $145,000 (or 7.3%). They’re now asking $1,850,000 which includes a new full bath (added in 2006) and reclaimed living space on the ground floor.
As we wrote two months ago:
215 Moulton “in the heart of Cow Hollow” appears to have been bought back by the bank with a loan balance of $1,893,000 this past July.
And while the contract price for its previous sale in November of 2007 doesn’t appear to be public, we will note a 2008 tax assessed value of $1,800,000 for this District 7 single-family contemporary townhouse.
Listed in April prior to foreclosure for $1,895,000, reduced to $1,795,000 in July, and currently asking $1,750,000.
And as we write today: the sale of 215 Moulton closed escrow on 11/14/08 with a reported contract price of $1,725,000. That's $168,000 less than its last loan balance. And $75,000 less than its last tax assessed value.
∙ Which Five Years Will The Next Five Years More Likely Resemble? [SocketSite]
∙ Cow Hollow Contemporary (And Apparent Foreclosure): 215 Moulton [SocketSite]
Posted by socketadmin at 1:45 PM | Permalink | Comments (20) | (email story)
SocketSite's San Francisco Listed Housing Update: 11/17/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco remained flat over the past two weeks but is running 28.4% higher on a year-over-year basis with sales volume off by 22% (down 38% over the past week alone).
The number of listings that have undergone at least one price reduction is now up over 75% on a year-over-year basis, a new record on both an absolute and percentage basis (currently 43.1% of all listings versus 31.6% at the same time in 2007 and 28.9% in 2006).
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 11/03/08 [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (78) | (email story)
November 14, 2008
And Speaking Of Being Plugged-In To Bay Area Employment Trends…
"Of course, if this was limited to Sun, it probably would not have a huge impact on anything concerning this site. But Sun is obviously just one of many going through this. You can't believe how swamped our labor & employment group is right now with work managing large tech layoffs, most of which are still in the planning stage (the lawyers get involved early on)."
∙ From Underwater To Unemployed (And Sorry, But It’s Just Starting) [SocketSite]
Posted by socketadmin at 1:00 PM | Permalink | (email story)
From Underwater To Unemployed (And Sorry, But It’s Just Starting)
A plugged-in reader's comment:
Remember all the excitement over Google millionaires buying up places with cash? We are now entering a period of huge tech layoffs (see Sun as one of many examples). I'm simply pointing out that this is yet another factor that is going to have a substantial negative impact on the market, particularly in the southern half of the city (which is much more than Ingleside and Visitacion Valley).
Said example: Sun to cut up to 6,000 workers, 18 pct of staff. And of course, the foreshadowing: The Google Chart Of The Day (10/24).
UPDATE: A plugged-in Sun employee chimes in:
Sun employee (for the moment), checking in. I don't think they are going to do layoffs for a few weeks, but I do think that 6k number might actually be a little low in the end.
A huge percentage of Sun's engineers telecommute at least part time so the impact will be spread out over most of the Bay Area.
What they're really talking about with this layoff is a cut in product lines, from top to bottom. There are a couple that are really housed elsewhere and it may not hit the Bay Area much at all. I think it will probably cause more pain in the RE market in Broomfield CO than it will here.
∙ TIC Troubles Via The WSJ (But We Wouldn't Discount That Downturn) [SocketSite]
∙ Sun to cut up to 6,000 workers, 18 pct of staff [SFGate]
∙ The Google Chart Of The Day (And A Bit More Foreshadowing) [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (54) | (email story)
November 13, 2008
The Potrero's New New Approach: Soliciting Minimum Sealed Bids
It appears as though The Potrero’s closeout offer of an additional $25,000 off already reduced prices of as much as $90,000 (11%) didn’t do the trick last month on those ten remaining homes. From the sales office today:
The Potrero will begin accepting sealed bids Friday, November 21, 2008 with the bid process ending on Sunday, November 23, 2008 at 5 p.m. Homes in this final release include 1-bedroom and 2-bedroom homes in the South Courtyard building – some with views of the city skyline or the beautifully landscaped courtyard. Price sheets, inventory information and the bid package required to submit a bid will be available at The Potrero sales center located at 451 Kansas Street, #312, San Francisco beginning Friday, November 14, 2003.
Minimum bids and additional details when we have them. And remember, it's not an auction. Those can only happen elsewhere. Like over in the East Bay.
∙ New Development “Closeout” Sales: The Potrero And 170 Off Third [SocketSite]
Posted by socketadmin at 3:45 PM | Permalink | Comments (19) | (email story)
TIC Troubles Via The WSJ (But We Wouldn't Discount That Downturn)
The Wall Street Journal article: Residential-TIC Tack Hits Snags.
The Quote:
The problems facing residential TICs, which are found mainly in San Francisco, are different and reflect tighter mortgage underwriting standards. Banks across the country have pulled back from all types of mortgage lending, but especially for nontraditional types of mortgages. As a result, borrowing costs for TICs have shot up, causing home buyers to avoid the structure.
Sterling Bank & Trust FSB recently raised its rate for TIC loans to 7.75% -- a loan for a similarly priced condo would require only 6% to 6.25% interest -- and now requires a down payment of at least 20% of the purchase price. Other banks are now requiring 30% down. In the past, lenders required buyers to put 10% down.
The listing: 158 Laidley ("Price REDUCED. Cut-rate financing! Stunning eco-modern...").
∙ Residential-TIC Tack Hits Snags [Wall Street Journal]
∙ Listing: 158 Laidley (5 TIC units) - $359,000 to $699,000 [158laidley.com]
Posted by socketadmin at 7:30 AM | Permalink | Comments (47) | (email story)
November 12, 2008
We’ll Pass On Getting Zillowed And Focus On The Apple-esque Data
We’ll pass on Zillow’s report on the percentage of Bay Area homes that are underwater as it relies on “zestimates” of current market value. And well, let’s just say we find the accuracy of Zillow’s zestimates to be anything but (accurate).
That being said, a key paragraph from the Chronicle's coverage of the study:
"The last recession in 2001-02 coincided with an upswing in housing market values so one could use home equity as a source of money to get them through, to smooth over volatility in their income stream," Fleming said. "That ability to use home equity as a source of income in times of economic stress now is removed" for many people.
And we are a bit more comfortable with the part of Zillow’s study that simply reports the percentage of homes that have sold over the past 12 months for less than their previous recorded sales price:
San Francisco 17.2%
Alameda 47.6%
Contra Costa 59.3%
Marin 24.1%
Napa 43.1%
San Mateo 30.2%
Santa Clara 40.1%
Solano 62.0%
Sonoma 49.9%
Bay Area 46.7%
Unlike our apples, however, not controlling or accounting for any improvements or investments (which likely results in an underreporting in the percentages above).
∙ Bay Area homeowners owe more than home's worth [SFGate]
Posted by socketadmin at 8:45 AM | Permalink | Comments (7) | (email story)
November 11, 2008
Fannie, Freddie and Citigroup To Join The Payment Cutting Parade
"Mortgage companies Fannie Mae and Freddie Mac and Citigroup Inc. plan to cut home-loan payments for hundreds of thousands of borrowers facing foreclosures, following similar moves by the nation's biggest banks.
Fannie Mae and Freddie Mac will reduce principal or interest rates on some loans and extend the terms of others, people briefed on the matter said. The Federal Housing Finance Agency, which seized control of Fannie and Freddie in September, scheduled a press conference at 2 p.m. in Washington to announce the plan."
∙ Citi, Fannie, Freddie to Halt Some Foreclosures [Bloomberg]
∙ JustQuotes: Proposing To Change The Terms To Protect The Principal [SocketSite]
Posted by socketadmin at 8:30 AM | Permalink | Comments (62) | (email story)
November 10, 2008
Don’t Confuse Average Prices And Appreciation: Look To The Apples
The Chronicle quote with regard to Bay Area home price appreciation:
One of the few standouts was the 94114 ZIP in San Francisco, home of Noe Valley, where houses go for well over a million dollars, designer strollers clog the sidewalks, posh shops peddle handmade ethnic tchotchkes, and the Google bus regularly cruises the streets.
But even that ZIP didn't enjoy the double-digit appreciation that became de rigueur during the real estate boom. Instead Noe Valley prices were up 6.8 percent year over year, from $893 a square foot [in 2007] to $954 [in 2008].
The problem: In a market like Noe where we’ve seen an increase in high-end renovations, sales and even some new construction, an increase in average sales price should not be confused with market "appreciation." Once again, think mix. And yes, even on a square foot basis.
The reality: Noe Valley apples (i.e., same home sales) paint a different - and we’d be willing to bet more accurate - picture of what’s happening with actual home values in Noe Valley these days. And up 6.8% year over year isn't it.
∙ Home prices down in 90% of Bay Area ZIP codes [SFGate]
Posted by socketadmin at 10:00 AM | Permalink | Comments (65) | (email story)
Reis Says: San Francisco Rents Up. Readers Say: But Falling.
"The average monthly price for a rental home in the San Francisco area, which includes San Francisco, San Mateo and Marin, leapt $251 over the past two years, from $1,579 in the third quarter of 2006 to $1,830 in the same quarter in 2008, according to data released Friday by national research firm Reis Inc."
Civic Center / Downtown: Up 21.5% from Q3 2006 to Q3 2008
(Q3 2006: $1,198; Q3 2007: $1,328; Q3 2008: $1,455)
Vacancy rate: 2.2 percent
Haight Ashbury / Western Addition: Up 20.6% from Q3 2006 to Q3 2008
(Q3 2006: $1,526; Q3 2007: $1,649; Q3 2008: $1,841)
Vacancy rate: 3.7 percent
West San Francisco: Up 18.5% from Q3 2006 to Q3 2008
(Q3 2006: $1,655; Q3 2007: $1,762; Q3 2008: $1,961)
Vacancy rate: 5.3 percent
Marina / Pacific Heights: Up 15.7% from Q3 2006 to Q3 2008
(Q3 2006: $1,908; Q3 2007: $2,075; Q3 2008: $2,208)
Vacancy rate: 2.4 percent
South of Market: Up 15.6% from Q3 2006 to Q3 2008
(Q3 2006: $1,898; Q3 2007: $2,079; Q3 2008: $2,194)
Vacancy rate: 4.3 percent
Russian Hill / Embarcadero: Up 11.8% from Q3 2006 to Q3 2008
(Q3 2006: $2,064; Q3 2007: $2,318; Q3 2008: $2,307)
Vacancy rate: 2.0 percent
UPDATE: An important point we neglected to make (but a plugged-in reader didn't):
Reis only contacts large apartments. About 90% of the rentals in SF are in small buildings so the data is almost worthless in SF (unless all you care about is the "asking" rent at large apartments like Parkmerced or Fillmore Center)...
∙ Rents continue to climb [San Francisco Examiner]
Posted by socketadmin at 7:30 AM | Permalink | Comments (46) | (email story)
November 6, 2008
A Renovated Single-Family Noe Valley Apple Gets Picked: 1604 Castro
The sale of 1604 Castro Street closed escrow yesterday (11/5/08) with a reported contract price of $1,000,000 (was listed for $1,050,000). Purchased for $920,000 in December of 2004, the sale of 1604 Castro represents average annual appreciation of roughly 2.2% over the past four years for this renovated single-family Noe Valley home.
That's not the kind of appreciation that was being sold, or bought, by most at the end of 2004. And while the temptation will be to see this as proof that home values in Noe have been holding steady, it’s a temptation we’d avoid (unlike chocolate).
As an aside, while there were 29 single-family homes and 39 condos/TICs listed in Noe at the time this home hit the market a month ago, there are now 38 and 52.
∙ A Noe Valley Apple Ripens As The Orchard Expands: 1604 Castro [SocketSite]
Posted by socketadmin at 2:45 PM | Permalink | Comments (55) | (email story)
November 3, 2008
Is That A Listing With Big Views (And Price) In Your Pocket Or…
From a plugged-in tipster: "A one-bedroom for $2.895 MM! There are a lot of pocket listings/off-market listings out there right now." That there are.
Let's think about why and what it means (in terms of market, reports and industry overall). And let's not forget to send the good ones (story, design, or price) our way.
∙ Listing: 1200 California #25a (1/1.5) 1,425 sqft - $2,895,000 [1200california25a.com]
Posted by socketadmin at 4:40 PM | Permalink | Comments (46) | (email story)
SocketSite's San Francisco Listed Housing Update: 11/03/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco remained flat over the past two weeks but is running 18.0% higher on a year-over-year basis.
The number of listings that have undergone at least one price reduction is now up over 66% on a year-over-year basis, a new record on both an absolute and percentage basis (currently 40.0% of all listings versus 28.7% at the same time in 2007 and 28.5% in 2006).
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Update: 10/13/08 [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (8) | (email story)
October 29, 2008
The Fed Cuts Rates To One Percent To Avert "Prolonged" Recession
A year ago Friday the Federal Reserve cut its benchmark interest rate to 4.5% and signaled that further cuts were unlikely. The thought at the time:
"Today's action, combined with the policy action taken in September, should help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets," the Federal Open Market Committee said in a statement after meeting today in Washington. "After this action, the upside risks to inflation roughly balance the downside risks to growth."
This morning, the Federal Reserve cut its benchmark interest rate to 1 percent, “matching a half-century low, in an effort to avert the worst U.S. economic downturn in the postwar era." And with that, the rate kegs have nearly run dry.
∙ Fed Cuts Rate to 1% to Avert Prolonged Recession [Bloomberg]
∙ The Federal Reserve Cuts Benchmark/Discount Rates By 0.25% [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (32) | (email story)
It's "Official," One Rincon Hill's Tower Two Is Indefinitely On Hold
It’s now "official" and in the open. The construction of One Rincon Hill's second tower has been indefinitely put on hold. And roughly 30% of tower one inventory has yet to close.
The plugged-in word on the street: talk of potential class action lawsuits with regard to the loss of tower two amenities and the handling of closings/deposits in tower one.
And with regard to a reader’s comment: “So how come CBS has the story of One Rincon cancelling/delaying the second tower before SocketSite??” Good question. There's no excuse. And perhaps that's the price we pay for delaying our latest Complete Inventory Index (Cii).
UPDATE: Keep in mind there's a big difference between “cancelled” and “on hold.” And while we’re done holding our breath for the actual groundbreaking of tower two, we do believe it will eventually come (and that we'll be the first to report it when it does).
UPDATE: Or in the words of developer Mike Kriozere, “We own the land, we have the financing and our construction [plans and] contracts are in place...Like others, our team is watching the economy for the proper time to re-commence construction.”
∙ Rincon Hill Among SF Building Projects Put On Hold [CBS]
∙ SocketSite’s Complete Inventory Index (Cii): Q1 2008 (San Francisco) [SocketSite]
Posted by socketadmin at 12:01 AM | Permalink | Comments (93) | (email story)
October 28, 2008
Argenta's Confirmed And Artani's Rumored, Will 77 Van Ness Be Next?
With Argenta (One Polk) on the market as an apartment building, and a reader suggesting that The Artani (818 Van Ness) might just follow suit (in terms of going rental), we’re keeping a close eye on the 56 units at 77 Van Ness (pictured above).
Regardless, with Symphony Towers (750 Van Ness) down the block cutting prices by up to 30% and The Hayes (55 Page) around the corner by up to 21%, we have a feeling they can’t finish construction on 77 Van Ness fast enough.
UPDATE: With a couple rental listings directly via Paragon on Craigslist (a two-bedroom at $4,250 and a fully furnished one-bedroom at $3,999), The Artani is at the very least testing the rental waters for a few of its 52 units.
∙ The Scoop: Argenta (1 Polk) On The Market As An Apartment Building [SocketSite]
∙ The Artani (818 Van Ness) Update: From Unveiled To Unwrapped [SocketSite]
∙ 77 Van Ness Rising (And Our Request For A Rendering) [SocketSite]
∙ Price Cuts Of Up To 30% At Symphony Towers (750 Van Ness) [SocketSite]
∙ New Development “Closeout” Sales: The Potrero And 170 Off Third [SocketSite]
Posted by socketadmin at 12:06 PM | Permalink | Comments (30) | (email story)
August S&P/Case-Shiller: San Francisco MSA Decline Accelerates
According to the August 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 3.5% from July ’08 to August ’08 and are down 27.3% year-over-year.
For the broader 10-City composite (CSXR), year-over-year price growth is down 17.7% (having fallen 1.1% from July).
Both the 10-City and 20-City Composites have been in year-over-year decline for 20 consecutive months. Of the 20 regions, 13 of them had their annual returns worsen from last month’s report. As seen throughout 2008, the Sun Belt markets are being hit the most. Phoenix and Las Vegas are both reporting annual declines in excess of 30%, and Miami, San Francisco, Los Angeles and San Diego are all in excess of 25%.
Prices fell across all three price tiers in the San Francisco MSA with the rates of decline accelerating across the board.
The bottom third (under $409,952 at the time of acquisition) fell 4.8% from July to August (down 42.7% YOY); the middle third fell 2.2% from July to August (down 26.3% YOY); and the top third (over $674,537 at the time of acquisition) fell 2.1% from July to August (down 13.6% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have retreated to December 2001 levels, the middle third has returned to October 2003 levels, and the top third has fallen below February 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ National Trend of Home Price Declines Continues into the Second Half of 2008 [S&P]
∙ July S&P/Case-Shiller: Pace Of San Francisco MSA Decline Continues [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (79) | (email story)
October 27, 2008
U.S. New Home Builders Start Seeing The Light (As Do Some Locals)
Sales of U.S. new homes rose 2.7% from July to September on a median sales price not seen since September 2004, but fell 33% from September 2007 on overall lower demand.
“Builders are seeing the light,” Mark Zandi, chief economist at Moody's Economy.com in West Chester, Pennsylvania, said in a Bloomberg Television interview. “They are cutting prices more aggressively. They're very nervous about all the foreclosures.”
Or in the case of San Francisco, the slowing of new home absorption (which shouldn’t catch any plugged-in readers by surprise).
∙ U.S. New-Home Sales Unexpectedly Rise as Prices Drop [Bloomberg]
∙ Price Cuts Of Up To 30% At Symphony Towers (750 Van Ness) [SocketSite]
Posted by socketadmin at 8:00 AM | Permalink | Comments (4) | (email story)
October 25, 2008
Price Cuts Of Up To 30% At Symphony Towers (750 Van Ness)
Plugged-in people knew the cuts were coming. And as one reports, they’re here. Prices at Symphony Towers (750 Van Ness) have been reduced by up to 30% or $136,000. A few examples:
∙ 750 Van Ness #T-405 (1/1) - $399,000 (was $535,000)
∙ 750 Van Ness #T-601 (1/1) - $459,000 (was $577,000)
∙ 750 Van Ness #T-602 (1/1) - $449,000 (was $565,000)
∙ 750 Van Ness #T-804 (0/1) - $295,000 (was $420,000)
∙ 750 Van Ness #T-806 (0/1) - $319,000 (was $455,000)
∙ 750 Van Ness #T-907 (0/1) - $419,000 (was $515,000)
Once again, currently around 55% sold. And with The Hayes cutting prices by up to 21%, the race for buyers in San Francisco is on. And it's plugged-in people that will win.
∙ Symphony Towers (750 Van Ness): Announcing Additional Cuts [SocketSite]
∙ Symphony Towers Update: Buying Love (But Dropping Prices Too) [SocketSite]
∙ New Development “Closeout” Sales: The Potrero And 170 Off Third [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (68) | (email story)
October 24, 2008
New Development “Closeout” Sales: The Potrero And 170 Off Third
Last weekend it was The Potrero that was offering “an additional $25,000 off* in addition to...already reduced prices” of as much as $90,000 (11%) on its ten remaining homes. Oh, and 12 months of pre-paid HOA dues.
This week 170 Off Third is advertising that its onsite Sales Center will shut down November 10th with “Final Offers” accepted November 8th and 9th and implores you to ”prepare a reasonable offer.” Let us know if you do. And just how reasonable it was.
And once again, Symphony Towers announced they’re cutting prices. Look for banners this weekend (and an update with the details when they’re released).
UPDATE: As a plugged-in reader notes, The Hayes cut prices today. The list prices on 55 Page #326 and #612 were reduced from $829,000 to $699,000 (a 16% drop), #610 was reduced from $599,000 to $499,000 (a 17% drop), and #522 was reduced from $429,000 to $339,000 (a 21% drop).
∙ Symphony Towers (750 Van Ness): Announcing Additional Cuts [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (7) | (email story)
535 Mission Street: From Office To Residential To Office To Suspended
"With the markets in turmoil and rents falling, Beacon Capital Partners has suspended construction on its 27-story office tower at 535 Mission St., the only speculative downtown highrise slated to be built over the next few years.
The $100 million HOK-designed tower was put on hold earlier this month in response to worsening market conditions. A spokesman for the Department of Building Inspection said the building permits had not been withdrawn yet. The excavation on the project was complete and contractor Swinerton had completed the pile driving."
∙ Construction work suspended at new downtown office tower [Business Times]
∙ Approved For Residential, But Building Commercial (535 Mission) [SocketSite]
∙ 535 Mission Update: Parking Lot Closed And About To Break Ground? [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (30) | (email story)
October 23, 2008
Actual San Francisco Foreclosures Up 36% QOQ (191% YOY)
Bay Area Notices of Default (NODs) increased 44% on a year-over-year basis in the third quarter of 2008, up 40% in San Francisco proper (from 252 to 353). And while the number of new NODs in San Francisco fell 15% from the second quarter, do keep in mind that a new state law took effect in September that can add 30 days to the lead time for a lender to file a notice.
At the same time, actual Bay Area foreclosures rose 273% (from 3,242 to 12,093) with Contra Costa (up 216% to 3,662), Alameda (up 274% to 2,521) and Santa Clara (up 428% to 2,165) leading the way. Recorded foreclosures in San Francisco totaled 192, up 191% on a year-over-year basis and up 36% (51 homes) from the second quarter 2008.
Most of the loans that went into default last quarter were originated between October 2005 and February 2007. The median age was 28 months, up from 18 months a year earlier.
In other words and once again, we're moving from those who were simply undercapitalized to begin with, to those who had more of a cushion in the bank.
∙ California mortgage default filings drop amid procedural change [DataQuick]
∙ Actual Bay Area Foreclosures Up 314% (San Francisco Up 182%) [SocketSite]
Posted by socketadmin at 12:30 PM | Permalink | Comments (17) | (email story)
October 21, 2008
San Francisco Recorded Sales Activity In September: Down 2.3% YOY
According to DataQuick, home sales volume in San Francisco fell 2.3% on a year-over-year basis last month (458 recorded sales in September ’08 versus 469 sales in September ‘07) and fell 13.4% compared to the month prior. San Francisco and San Mateo were the only two Bay Area counties to record a sales volume decline.
Keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded). And based on our calculations, listed sales activity is currently running 30% lower on a year-over-year basis.
San Francisco's median sales price in September was $675,000, down 12.7% compared to September ’07 ($773,000) and down 6.9% compared to the month prior.
For the greater Bay Area, recorded sales volume in September was up 45% on a year-over-year basis and increased a nominal 0.5% from the month prior (7,271 recorded sales in September '08 versus 5,014 in August ’07 and 7,232 in August '08), while the recorded median sales price fell 36% on a year-over-year basis, down 10.5% compared to the month prior. Once again, think foreclosures.
At the extremes, Solano recorded a 101.2% year-over-year increase in sales volume (a gain of 325 transactions) on a 35.7% decrease in median sales price, while Contra Costa recorded a 94.3% increase in sales volume (a gain of 874 transactions) on a 45.6% drop in median sales price.
∙ Bay Area home sales up 45% over '07; median price falls to $400K [DQNews]
∙ San Francisco Recorded Sales Activity In August: Down 8.3% YOY [SocketSite]
∙ SocketSite's San Francisco Listed Housing Update: 10/13/08 [SocketSite]
Posted by socketadmin at 10:45 AM | Permalink | Comments (67) | (email story)
October 17, 2008
U.S. Single-Family Housing Starts Fall While Multifamily Starts Rise
U.S. Single-family housing starts in September fell 12 percent to their lowest level in 26 years while multifamily home starts (which includes apartment buildings) climbed 7.5 percent from month prior. The key sentence (and continued foreshadowing) from Bloomberg's coverage: "Builders will find it difficult to lure buyers into the market after stock prices plunged this month and banks made it harder to qualify for a mortgage."
Okay, and this one as well: "The full impact from the financial meltdown is yet to come."
∙ Single-Family Home Starts in U.S. Fall to 26-Year Low [Bloomberg]
Posted by socketadmin at 7:30 AM | Permalink | Comments (10) | (email story)
October 16, 2008
Developers In San Francisco Getting Squeezed From Both Sides
Last week we surfaced the issue of construction loan covenants putting pressure on developers to sell, this week the mortgage lenders get into the act. From the Mark Company by way of a plugged-in tipster:
• Wells Fargo now requires that 25% of the units be in contract or closed before they can fund the first loan.
• Chase is requiring that 51% of the units be in contract or closed before the first loan can close. Their previous presale requirement was 25%. We first saw this in Los Angeles, but the requirement has now been instituted nationally.
• Countrywide now bases the required presale percentage on the project's sales velocity. Well-marketed projects with solid absorption may have a presale requirement of 15%, while slower moving projects have higher presale thresholds.
In addition to varying presale requirements, lenders will continually evaluate the ongoing success of a project, as well as the developer's reputation and financial position. [The Mark Company's] understanding is that a project with a sales velocity of 3-4 homes in contract per month will be considered marketable and therefore acceptable for the lender to continue processing loans on. Should a project fall below that threshold, loans may be discontinued.
In the words of our tipster:
A mortgage broker friend of mine suggests that this takes things back to “the old days” when no lender wanted to be the first one in a project. The first 25% of the units would typically be sold/financed subject to “simultaneous” escrow closes.
And in the words of us: there are other old days (now new new days) implications as well.
∙ RandomRumors: Calling On That Guy And The Guy He Heard It From [SocketSite]
Posted by socketadmin at 8:10 AM | Permalink | Comments (19) | (email story)
Jumbo-Conforming Loans Going, Going, And Almost Gone
A good reminder from Julian Hebron at Residential Pacific Mortgage:
Be advised that super-conforming loans up to $729k will be gone as of December 31. Those loans have to fund, clear all lenders’ books, and be in the hands of Fannie or Freddie by December 31, so many lenders are not accepting these loans past the end of October, but there are some players that will go a bit longer. Anyone looking for these loan amounts needs to consider their timing.
Get them while you can. And keep in mind that once the Economic Stimulus Act of 2008 and it's $729,750 conforming loan limit for San Francisco expires, it's the conforming loan maximum of $625,500 or Jumbo market to which we'll have to turn.
∙ Will San Francisco Suffer From Premature Loan Limit Reduction? No. [SocketSite]
∙ If Lowering Rates Isn’t Working, Perhaps Increasing Limits Will [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (26) | (email story)
October 15, 2008
California Association of Realtors’ 2009 Forecast (And Perhaps Folly)
If the California Association of Realtors’ 2009 forecast is accurate, the median sales price of a home in California will decline by 6 percent in 2009 while sales volume will rise 12.5%.
Regardless, there’s the quote with which we absolutely don’t agree (once again, cue the foreshadowing): ""The worst is over, but we're still not out of the woods," said Leslie Appleton-Young, the association's chief economist." And the one with which we do: "This forecast is not baking in a recession with huge job losses."
Or as JPMorgan Chase CEO Jamie Dimon said today, "We have to be prepared that [the economic slump] gets a lot worse and we are." Unfortunately CAR doesn't appear to be part of that latter "we."
∙ Forecast: Calif. home prices to dip further in '09 [SFGate]
∙ JPMorgan's Dimon Plans for More Loan Losses as Economy Weakens [SocketSite]
Posted by socketadmin at 11:45 AM | Permalink | Comments (50) | (email story)
October 14, 2008
While Seasonality Is In Effect, That's Not What This Is About
As we wrote two weeks ago:
…based on our calculations, the number of new contracts written for listed [San Francisco] properties in the fourth week of September was down roughly 25% as compared to the year prior (which was down roughly 17% as compared to the year prior to that), and is running roughly 22% lower on a year-over-year basis with respect to the last two weeks of the month.
As we wrote yesterday morning:
…based on our calculations, and setting the stage for tomorrow’s “on topic” post, new contract volume last week dropped 45% from the week prior and was off by 31% on a year-over-year basis.
And as Redfin wrote yesterday afternoon (about the markets in which they play):
…the past few weeks have seen a major reversal. As the stock market wiped out prospective down-payments, tours and offers dropped 30%. Transactions that were done came undone. October will still be pretty good, then we’re headed for a big dip.
Keep in mind it's the same story in brokerages and sales offices throughout town – the transaction downturn not the layoffs (as far as we know) – they just haven't had any reason to let it be publicly known.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/29/08 [SocketSite]
∙ SocketSite's San Francisco Listed Housing Update: 10/13/08 [SocketSite]
∙ Sequoia’s Take On The New New (And Quite Local) Economy [SocketSite]
∙ A Very Tough Day [Redfin]
Posted by socketadmin at 6:45 AM | Permalink | Comments (30) | (email story)
October 13, 2008
SocketSite's San Francisco Listed Housing Update: 10/13/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco continued to climb over the past two weeks, is flirting with the 1,800 units mark, and is currently running 16.8% higher on a year-over-year basis.
The number of listings that have undergone at least one price reduction is up over 56% on a year-over-year basis, setting a new record (at least since we've been keeping track) on both an absolute and percentage basis (currently 34.5% versus 27.4% at the same time in 2007 and 24.4% in 2006).
And based on our calculations, and setting the stage for tomorrow’s “on topic” post, new contract volume last week dropped 45% from the week prior and was off by 31% on a year-over-year basis.
And with that, we really are taking the rest of the day off.
[The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).]
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/29/08 [SocketSite]
∙ Sequoia’s Take On The New New (And Quite Local) Economy [SocketSite]
Posted by socketadmin at 12:30 AM | Permalink | Comments (132) | (email story)
October 10, 2008
Sequoia’s Take On The New New (And Quite Local) Economy
It's not the kind of image on which we typically like to end the week, but In the words of a plugged-in tipster:
Know this is a bit off topic, but since the valley tech is such a driver for home sales (and vc dollars are a driver for tech), thought you might be interested in this if you haven’t already seen it.
PowerPoint from Sequoia Capital...just delivered this to their ~100 portfolio companies. Good economic context, and, equally importantly, a telling embedded message (fire as many ppl as it takes to get to break even).
Yep. And our "on topic" take on Tuesday (we're taking Monday off).
∙ Sequoia Capital on startups and the economic downturn [slideshare.net]
Posted by socketadmin at 2:00 PM | Permalink | Comments (32) | (email story)
The Graphic To Go With The 2008 Granted Reductions
As a plugged-in reader points out, the Chronicle's graphic (and story) to accompany the tax assessor's 2008 granted reductions above, and and the stories of a number of plugged-in readers who either succeeded or failed below.
And yes, lot's of biases but interesting nonetheless (if not only in terms of perception).
∙ Home-tax trims won't hurt S.F., assessor says [SFGate]
∙ Average Granted Assessed Value Reduction In San Francisco: 11.5% [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (18) | (email story)
October 8, 2008
Average Granted Assessed Value Reduction In San Francisco: 11.5%
The tax assessor tally for San Francisco homeowners is in: 1,673 requests for property value reevaluations, 810 reductions granted (of which hopefully reader Rillion was one), and an average reduction of 11.5%/$137,057 citywide (in other words, we're not just talking about the "cheap" stuff).
UPDATE: A comment from a consistently plugged-in broker:
Even though I have proof in the form of apples to apples sales comps that my home value has declined 15%, I was denied a reduction and have to go to a full hearing.
The City is being selective and arbitrary in this whole process. Yes, I am a broker, but I am also the owner of a declining asset.
Obviously our Mystery Realtor must be "cherry picking" those apples...
∙ JustQuotes: It's Time To Make Some Property Tax Lemonade [SocketSite]
∙ More than 800 homeowners granted a reduction in assessed value [Examiner]
Posted by socketadmin at 9:00 AM | Permalink | Comments (39) | (email story)
Unlike In San Francisco, U.S. Pending Home Resales (Were) Up
According to the National Association of Realtors, the rate of pending U.S. home resales rose 7.4% from July to August and is up 8.8% on a year over year basis. Pending sales in the West jumped 18.4% driven by foreclosure activity.
Keep in mind that both resale and new home sales volume continues to fall in San Francisco. And a couple of things have changed in the U.S. since August.
∙ U.S. Pending Home Resales Rose 7.4% as Foreclosures Cut Prices [Bloomberg]
∙ San Francisco Recorded Sales Activity In August: Down 8.3% YOY [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (6) | (email story)
October 7, 2008
Six-Month Libor Lifts Off As Well (Just In Time For That Reset Redux)
From Citigroup via Bloomberg:
About 121,000 mortgages will reset for the first time next month, according to the Citigroup report, which looked at only securitized mortgages. About 1.8 million loans have already begun adjusting based on benchmark rates, the report said, while 3.7 million face resets scheduled for after next month.
"Almost all" subprime and Alt-A ARMs with a few years of fixed rates, about 60 percent of those prime-jumbo mortgages and about 75 percent of such loans in Fannie Mae, Freddie Mac and Ginnie Mae bonds are linked to Libor, the report said. The loans most often are pegged to six-month Libor.
Over the past three weeks six-month Libor has climed from three percent to over four. And if you've held for over three years (or under one), it's likely higher than before.
∙ Libor Rise to Boost Subprime ARM Defaults 10%, Citigroup Says [Bloomberg]
∙ JustQuotes: ARM Holders Take Note, Libor Lifts Off [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (16) | (email story)
September 30, 2008
July S&P/Case-Shiller: Pace Of San Francisco MSA Decline Continues
According to the July 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 1.8% from June ’08 to July ’08 and are down 24.8% year-over-year (once again, a new record low).
For the broader 10-City composite (CSXR), year-over-year price growth is down 17.5% (having fallen 1.1% from June).
Prices fell across both the bottom and top price tiers for the San Francisco MSA while the middle tier was unchanged. The bottom third (under $432,119 at the time of acquisition) fell 4.1% from June to July (down 41.3% YOY); the middle third remained unchanged from June to July (down 25.2% YOY); and the top third (over $696,153 at the time of acquisition) fell 0.6% from June to July (down 11.1% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have returned to May 2002 levels, the middle third remains at December 2003 levels, and the top third is approaching February 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Continued Record Home Price Declines [S&P]
∙ June S&P/Case-Shiller: San Francisco MSA Continues Decline [SocketSite]
Posted by socketadmin at 6:05 AM | Permalink | Comments (122) | (email story)
September 29, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 9/29/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco continued to climb over the past two weeks, briefly broke through the 1,700 units mark, and is currently running 14.2% higher on a year-over-year basis.
At the same time and based on our calculations, the number of new contracts written for listed properties in the fourth week of September was down roughly 25% as compared to the year prior (which was down roughly 17% as compared to the year prior to that), and is running roughly 22% lower on a year-over-year basis with respect to the last two weeks of the month.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/15/08 [SocketSite]
Posted by socketadmin at 1:30 AM | Permalink | Comments (32) | (email story)
September 26, 2008
Speaking Of Office Space (And Absorption) In San Francisco
Office leasing in San Francisco by the numbers and by way of the Business Times: 550,000 square feet of negative absorption in the third quarter (including 111,000 square feet in SoMa) and 684,000 square feet of negative absorption for the year.
∙ San Francisco tenants dump office space [Business Times]
Posted by socketadmin at 7:30 AM | Permalink | Comments (14) | (email story)
September 25, 2008
U.S. New Home Sales Continue To Decline, Builder Angles For Bailout
The pace of new home sales in the U.S. were down 35 percent on a year-over-year basis last month (“the lowest annual rate since the 1991 recession”) led by a 36 percent drop from July to August in the West.
Lennar Corp., the second-largest U.S. homebuilder, this week reported its sixth straight quarterly loss and said the government must take measures to boost home prices that are down by nearly a fifth from their 2006 peaks.
"Consensus is building that falling home prices are not only detrimental to the economy at large, but in order to repair our failing financial system we will have to stop the decline," Chief Executive Officer Stuart Miller said.
No word on whether or not Mr. Miller would be willing to help fund such government “measures” by donating the record monies earned by Lennar prior to said decline.
∙ U.S. Economy: Home Sales, Durable Goods Orders Drop [Bloomberg]
Posted by socketadmin at 10:30 AM | Permalink | Comments (15) | (email story)
September 23, 2008
Listed Inventory (Up) And Sales (Down) Mini-Update: 9/23/08
A more complete update next week, but active listed inventory in San Francisco crossed the 1,600 mark for the first time in at least three years last weekend (now up 12.1% on a year-over-year basis) while listed sales activity last week appears to have run roughly 18% off the levels of the year prior (and 43% below the year before that).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/15/08 [SocketSite]
Posted by socketadmin at 12:45 AM | Permalink | Comments (3) | (email story)
September 18, 2008
San Francisco Recorded Sales Activity In August: Down 8.3% YOY
According to DataQuick, home sales volume in San Francisco fell 8.3% on a year-over-year basis last month (529 recorded sales in August ’08 versus 577 sales in August ‘07) and fell 13.1% compared to the month prior.
Keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
San Francisco's median sales price in August was $725,000, down 11.8% compared to August ’07 ($822,000) and down 3.2% compared to the month prior.
For the greater Bay Area, recorded sales volume in August was down 0.9% on a year-over-year basis and fell 4.7% from the month prior (7,232 recorded sales in August '08 versus 7,299 in August ’07 and 7,586 in July '08), while the recorded median sales price fell 31.8% on a year-over-year basis, down 4.9% compared to the month prior. Once again, think foreclosures.
Last month's sales total was the second-lowest for an August, behind 6,688 sales in August 1992, in MDA DataQuick's statistics, which go back to 1988. An "average" August had 10,031 sales, while the peak August in 2004 had 13,940.
At the county level, foreclosure resales ranged from 8.6 percent of resales in San Francisco to 61.3 percent in Solano County. In the Bay Area's other seven counties, August foreclosure resales were as follows: Contra Costa, 54.4 percent; Marin, 13.5 percent; Napa, 39 percent; Santa Clara, 24.7 percent; San Mateo, 16.6 percent; Sonoma, 41.6 percent.
At the extremes, San Mateo recorded a 23.4% year-over-year reduction in sales volume (a loss of 171 transactions) and a 19.8% decrease in median sales price, while Contra Costa recorded a 35.5% increase in sales volume (a gain of 454 transactions) but a 42.1% drop in median sales price.
∙ Bay Area home sales near bottom again, median price plunges [DQNews]
∙ San Francisco Recorded Sales Activity In July: Up 8.0% YOY [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (82) | (email story)
Goodbuy (sic) Supermarkets, Specialty Retailers Are In The House(s)
"[S]upermarket sites are some of the last large real estate lots in the city. Eager developers are making such generous offers that store owners would be crazy to turn them down. No wonder supermarkets are an endangered species in the city."
∙ Supermarkets an endangered species in S.F. [SFGate]
Posted by socketadmin at 7:15 AM | Permalink | Comments (11) | (email story)
September 17, 2008
Mortgage Rates Dip, Applications Climb, And "Paper Losses" Count
"Last week, applications by homeowners looking to refinance their mortgages spiked 88 percent, according to the Mortgage Bankers Association. Refinances accounted for nearly 52 percent of all application activity, up from 36 percent the previous week...purchase applications also edged up last week by 5 percent.
But while the number of applications soared last week, the approval rates will likely be low because appraisals for many homes are coming in close to or below the amount of the existing mortgages."
∙ Applications to refinance home mortgages surge [SFGate]
Posted by socketadmin at 3:00 PM | Permalink | Comments (1) | (email story)
JustQuotes: ARM Holders Take Note, Libor Lifts Off
"The overnight Libor rate in U.S. dollars soared 3.33 percentage points to 6.44 percent today, its biggest jump in at least seven years....The one-week rate rose by more than a percentage point, to 3.88 percent from 2.49 percent on Monday, and the one-month rate increased to 2.75 percent from 2.5 percent."
∙ U.S. Mortgage Rates May Wreak Havoc After Libor Gain [Bloomberg]
Posted by socketadmin at 7:00 AM | Permalink | Comments (36) | (email story)
September 15, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 9/15/08
As expected, inventory of Active listed single-family homes, condos, and TICs in San Francisco jumped over the past two weeks (15.5% versus an average of 25.8% for the same two weeks in the past two years). Listed inventory is currently running 9.7% higher on a year-over-year basis.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/02/08 [SocketSite]
Posted by socketadmin at 5:30 AM | Permalink | Comments (8) | (email story)
September 12, 2008
Once again...Forget Subprime In San Francisco, But How About Alt-A?
As we wrote last year, "Forget Subprime In San Francisco, But How About Alt-A?" And from Bloomberg today:
About 3 million U.S. borrowers have Alt-A mortgages totaling $1 trillion, compared with $855 billion of subprime loans outstanding, according to Inside Mortgage Finance, a trade publication in Bethesda, Maryland. Of the Alt-A borrowers, 70 percent may have exaggerated their income, said David Olson, president of mortgage research firm Wholesale Access in Columbia, Maryland.
∙ Alt-A Mortgages Next Risk for Housing Market as Defaults Surge [Bloomberg]
∙ JustQuotes: Forget Subprime In San Francisco, But How About Alt-A? [SocketSite]
Posted by socketadmin at 4:00 PM | Permalink | Comments (84) | (email story)
September 9, 2008
U.S. Pending Home Resales Fall 3.2% MOM (10.6% In The West)
The National Association of Realtors’ index for pending U.S. home resales fell 3.2% in July (10.6% in the West).
The pending resales report is considered a leading indicator because it tracks contract signings. Closings, which typically occur a month or two later, are tallied in a separate report from the Realtors.
That being said, keep in mind that seasonality is very much in play (and pending resales were not down YOY in the West).
∙ U.S. Pending Home Resales Decline More Than Forecast [Bloomberg]
Posted by socketadmin at 7:30 AM | Permalink | Comments (6) | (email story)
September 5, 2008
U.S. Foreclosure Rates For Prime Loans Continues To Accelerate
According to the latest report from the Mortgage Bankers Association, the pace of new U.S. home foreclosures "increased to 1.19 percent, rising above 1 percent for the first time in the survey's 29 years."
Tumbling home prices are making it difficult for even the most creditworthy owners with adjustable-rate mortgages to sell or get a new loan as their financing costs rise, said Jay Brinkmann, MBA's chief economist. Prime ARMs accounted for 23 percent of new foreclosures and subprime ARMs were 36 percent, he said.
"People chose the lowest payment option to get into some of the very expensive housing markets and now that prices are coming way down, they can't sell and they can't afford the higher payments," Brinkmann said in an interview.
Also noted, while the rate of new foreclosures on subprime loans rose from 4.06 percent to 4.7 percent over the past year, the rate of new foreclosures for prime ARMs jumped from 0.58 percent to 1.82 percent and "the share of seriously delinquent prime ARMs was 6.78 percent, rising from 2.02 percent a year ago."
And on that note, we do a quick flashback to 2005: An ARM (And Quite Possibly A Leg).
∙ U.S. Mortgage Foreclosures, Delinquencies Reach Highs [Bloomberg]
∙ An ARM (And Quite Possibly A Leg) [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (46) | (email story)
JustQuotes: Foreigners Buoying Sales (Retail Not Real Estate)
"San Francisco’s job market is weakening, being buoyed by ongoing strength in the tourism industry, according to The City’s monthly economic barometer."
"The monthly economic report also states that The City’s retail sector may be “cooling after several years of rapid growth.” The report points to a “significantly lower” number of cars parking at garages around Union Square compared to last year without a commensurate increase in transit ridership."
∙ San Francisco's job market losing steam [Examiner]
∙ Recap: What’s The Scoop On Foreign Investment In San Francisco? [SocketSite]
Posted by socketadmin at 6:00 AM | Permalink | Comments (19) | (email story)
September 4, 2008
QuickLinks: A Luxury Market Triptych
∙ Some Extra Bread To Go With That Cake At 2090 Vallejo [SocketSite 8/07]
∙ Mansion Price Drops $7 Million; Bentley Offered on Luxury Homes [Bloomberg 9/08]
∙ Not The Best “Investment” For Agassi In Tiburon [SocketSite 11/06]
Posted by socketadmin at 8:00 AM | Permalink | Comments (2) | (email story)
September 2, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 9/02/08
As expected, inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 3.7% over the past two weeks (versus an average of 7.5% over the prior two years) and is currently running 18% higher on a year-over-year basis.
Expect to see listed inventory spike over the next couple of weeks as buyers, sellers and agents alike return from vacation and listings new and old return to the market.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 8/18/08 [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (25) | (email story)
August 26, 2008
June S&P/Case-Shiller: San Francisco MSA Continues Decline
According to the June 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 1.8% from May ’08 to June ’08 and are down 23.7% year-over-year (a new record low).
For the broader 10-City composite (CSXR), year-over-year price growth is down 17.0% (having fallen only 0.6% from May).
Prices fell across all three price tiers for the San Francisco MSA with the upper tier falling 1.4% from May to June and erasing the 0.9% gain from April to May.
The bottom third (under $446,755 at the time of acquisition) fell 2.8% from May to June (down 39.6% YOY); the middle third fell 0.6% from May to June (down 25.8% YOY); and the top third (over $706,704 at the time of acquisition) fell 1.4% from May to June (down 10.2% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have returned to June 2002 levels, the middle third to December 2003 levels, and the top third continues to hold at March 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ National Trend of Home Price Declines Continued [S&P]
∙ May S&P/Case-Shiller: San Francisco MSA Declines (But Rate Slows) [SocketSite]
Posted by socketadmin at 6:10 AM | Permalink | Comments (153) | (email story)
August 25, 2008
Pace Of U.S. Existing Home Sales Up (MOM) But Still Off (YOY)
The pace of U.S. previously owned homes rose 3.1% in July to an annual rate of 5 million homes as the median price fell $16,200 (7%) on a year-over-year basis, but remains 13% below the pace of 2007.
The increase in sales wasn't enough to keep up with the surge in properties coming into the market as foreclosures mount. There were a record 4.67 million unsold houses and condos on the market in July, representing 11.2 month's supply at the current sales pace, matching the highest ever. The [National Association of Realtors] has said a five to six months' supply is consistent with a stable market.
The jump in inventory was driven by an increase in the supply of condos as projects started one or two years ago came on the market, the Realtors group said.∙ U.S. Economy: Existing Home Sales Increased 3.1 Percent in July [Bloomberg]
Posted by socketadmin at 8:45 AM | Permalink | Comments (6) | (email story)
August 20, 2008
Mortgage Modifications: Short-Term Solution To Long-Term Problem?
The intended impact of lowering mortgage interest rates for IndyMac borrowers who are currently delinquent:
“We hope to keep tens of thousands of troubled borrowers in their homes and avoid the negative consequences that foreclosures can have on the broader economy,'' [FDIC Chairman Sheila Bair] said.
The unintended impact (and food for thought):
Bair's efforts may lower the value of mortgage-bond holdings by delaying foreclosures until home prices are lower, said Julian Mann, a mortgage- and asset-backed bond manager at First Pacific Advisors LLC in Los Angeles, which oversees $11 billion.
∙ FDIC Will Modify Mortgages for Some IndyMac Borrowers [Bloomberg]
Posted by socketadmin at 12:45 PM | Permalink | Comments (22) | (email story)
San Francisco Affordability: Is C.A.R.'s New Reality Already Old?
According to the California Association of Realtors and their First Time Buyer Housing Affordability Index, 23% of San Francisco households can currently afford to purchase a home priced at 85% of the local median. Their assumptions: $693,840 purchase price, 10% down, 5.69% financing (ARM), monthly payment of $4,420 (including taxes and insurance), and a household income of $132,550.
That’s up from 18% affordability a year ago, up from 16% the year before that, and up from 9% prior to C.A.R. redefining how their index is calculated.
As you might recall, it was two years ago that C.A.R. changed their 24-year-old index to reflect a down payment of 10% (down from 20%), a monthly payment of no more than 40% of a household’s income (up from 30%), and a short-term adjustable rate mortgage (versus long-term fixed). The rational at the time:
In the more than two decades since the CALIFORNIA ASSOCIATION OF REALTORS® first conceived the HAI, the mortgage finance landscape has changed dramatically. The range of mortgage products available to buyers as well as underwriting criteria has changed.
C.A.R. developed the new index measuring affordability for first-time home buyers to better reflect the realities of today’s real estate market.
Now about the new new realities and underwriting criteria two years later (today)...
∙ Entry-level housing affordability increases 50 percent [C.A.R.]
∙ Affordability Is Up! (But Not Really) [SocketSite]
Posted by socketadmin at 7:50 AM | Permalink | Comments (150) | (email story)
August 19, 2008
San Francisco Recorded Sales Activity In July: Up 8.0% YOY
According to DataQuick, home sales volume in San Francisco rose 8.0% on a year-over-year basis last month (609 recorded sales in July ’08 versus 564 sales in July ‘07) and rose 6.7% compared to the month prior.
Keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
San Francisco's median sales price in July was $749,000, down 6.3% compared to July ’07 ($799,000), but up 3.1% compared to the month prior. In terms of mix, we see the median being weighed down by the recording of Below Market Rate units (which is also spiking recorded sales activity) and a nominal uptick in activity in less expensive Districts (a shift of around 3% based on listed transactions).
For the greater Bay Area, recorded sales volume in July was up 2.2% on a year-over-year basis and increased 5.7% from the month prior (7,586 recorded sales in July '08 versus 7,423 in July ’07 and 7,178 in June '08). But the recorded median sales price fell 29.3% on a year-over-year basis (down 3.1% compared to the month prior).
July sales were the highest for any month since June 2007 and marked the first annual sales gain for any month since January 2005. However, last month's sales still fell 22 percent short of the average July sales total since 1988, when MDA DataQuick's statistics begin, and were the second- lowest for a July since 1995.
Foreclosure resales -- homes sold in July that had been foreclosed on in the prior 12 months -- made up 33 percent of all resales. That was up from 29.9 percent in June and 4.2 percent in July 2007. Foreclosure resales ranged from 4.6 percent of the resale market in San Francisco to 65.9 percent in Solano County.
At the extremes, Santa Clara recorded a 13.1% year-over-year reduction in sales volume (a loss of 250 transactions) and a 16.4% decrease in median sales price, while Contra Costa recorded a 30.3% increase in sales volume (a gain of 502 transactions) but a 41.6% drop in median sales price (think foreclosures).
UPDATE: While the numbers are above, it’s worth highlighting the impact of foreclosures on sales volume last month. Not counting the resale of foreclosed properties, sales volume in the Bay Area actually dropped 28.5% from 2007 to 2008 (versus the 2.2% increase referenced above). And in San Francisco, we estimate the increase in year-over-year recorded sales volume for non-foreclosure properties to be closer to 4% (versus the 8% referenced above).
∙ Bay Area home sales climb above last year; median price falls hard [DQNews]
∙ San Francisco Recorded Sales Activity In June: Down 9.8% YOY [SocketSite]
Posted by socketadmin at 11:20 AM | Permalink | Comments (73) | (email story)
August 18, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 8/18/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 4.3% over the past two weeks (which is typical in the weeks leading up to Labor day) and is currently running 17% higher on a year-over-year basis.
Expect to see listed inventory continue to decline over the next two weeks and then spike in the first two weeks of September.
The standard SocketSite Listed Inventory footnote: Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 8/05/08 [SocketSite]
Posted by socketadmin at 1:00 AM | Permalink | Comments (53) | (email story)
August 15, 2008
San Francisco Landlord Foreclosures: Tenant PSA And Growing Trend
"State and local laws prohibit landlords from evicting tenants or shutting off utilities [due to a foreclosure], but not all renters are aware of the rules, and not all of the entities that take control of properties try to learn them."
"The issue was virtually unheard of a year ago. The San Francisco Tenants Union had to circulate a memo to its counselors earlier this year because few had ever encountered it before.
The exact number of tenants dealing with the aftermath of a landlord foreclosure is difficult to ascertain. Three tenants groups contacted by The Chronicle reported around 130 cases this year, but most counselors believe that many more tenants aren't contacting the organizations. What is known is that lenders foreclosed on 492 homes in San Francisco during the last year and a half, according to DataQuick Information Systems."
∙ Foreclosure's hidden victims [SFGate]
Posted by socketadmin at 6:00 AM | Permalink | Comments (30) | (email story)
August 14, 2008
U.S. Home Resale Rate Falls To Ten Year Low (Again)
From Bloomberg last month:
Sales of previously owned U.S. homes fell in June to the lowest level in a decade as tumbling real- estate prices and consumer confidence signal no end in sight to a housing recession now in its third year.
Resales dropped 2.6 percent to a lower-than-forecast 4.86 million annual rate from a 4.99 million pace the prior month, the National Association of Realtors said today in Washington. The median home price dropped 6.1 percent from June of last year.
From Bloomberg today:
Existing U.S. home sales fell to a 10-year low in the second quarter and the median price for a single-family house dropped 7.6 percent as the real estate recession deepened.
The median tumbled to $206,500 from $223,500 a year earlier, the Chicago-based National Association of Realtors said today. Sales of single-family houses and condominiums fell 16 percent to 4.913 million at an annualized pace.
In terms of those transactions, "foreclosures and 'short sales,' in which lenders agree to take a loss on a property, accounted for a third of all sales in the quarter."
And as they say, live by the median, die by the median (or something like that).
∙ U.S. Home Resale Rate Falls To Ten Year Low (And 33% Below 2005) [SocketSite]
∙ U.S. Home Sales Fall to 10-Year Low as Prices Tumble [Bloomberg]
Posted by socketadmin at 8:00 AM | Permalink | Comments (10) | (email story)
JustQuotes: It's Time To Make Some Property Tax Lemonade
"San Francisco homeowners are flooding City Hall with so many requests to reduce their property values that the tax assessor said today his office may not be able to meet the demand. So far, Assessor-Recorder Phil Ting's office has received about 1,000 requests for informal reevaluations - three times the number filed last year. Friday is the deadline to request an informal property reevaluation from the assessor."
"Formal requests for reassessment must be filed by Sept. 15 and Ting said anyone who does not hear back from his office - or does not agree with their assessment - should file by that date."
∙ S.F. assessor overwhelmed with reevalution requests [SFGate]
∙ Assessing The Potential Upside Of A Down Market: Property Tax Basis [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (17) | (email story)
August 13, 2008
It's A Good Thing It's Simply A Subprime (And District 10) Problem...
"Yields on mortgage securities guaranteed by Fannie Mae rose this week to about their highest relative to Treasuries since March amid concern that defaults are spreading to prime and Alt-A mortgages from subprime loans.
Fannie's current-coupon 30-year fixed-rate bonds currently yield 6.07 percent, 213 basis points more than 10-year Treasuries, according to data compiled by Bloomberg. That's 25 basis points from the 22-year high of 238 reached March 6, a week before the Federal Reserve helped bail out Bear Stearns Cos.
The worst housing slump since the Great Depression has blotted out much of the wealth Americans accumulated in their homes, hurting their ability to pay bills and boosting spreads on auto-loan and credit-card backed bonds as well as mortgage securities. Fannie Mae, the largest U.S. mortgage-finance company, last week slashed its dividend 86 percent after posting a worse-than-expected loss and said it will stop buying and guaranteeing Alt-A loans."
[Editor's Note: And no, this shouldn't catch any plugged-in people by surprise.]
∙ Agency Mortgage Bond Yield Spreads Widen as Loan Losses Expand [Bloomberg]
∙ Subprime And Alt-A Statistics By County: The Feds Mortgage Map [SocketSite]
∙ Fannie Follows Freddie (And Makes It Easy For The Copywriters) [SocketSite]
∙ Fannie Mae, Battling Losses, to End Alt-A Mortgages [Bloomberg]
∙ JustQuotes: Is The Subprime Sickness Spreading? [SocketSite 7/07]
Posted by socketadmin at 2:30 PM | Permalink | Comments (26) | (email story)
August 7, 2008
A Noe Valley/Glen Park Apple In The Making And Neighborhood Inquiry
Purchased for $1,150,000 in September of 2005, a sale of 254 30th Street at the current asking price ($1,250,000) would represent average annual appreciation of 2.9% over the past three years (assuming no improvements) for this single-family home on the border of Noe Valley and Glen Park.
And a related reader inquiry:
I'd love to see some SocketSite regulars weigh in with predictions for the selling prices for some of the single-family homes on the market in Noe Valley. There are a bunch right now priced in the sweet spot between $900K and $1.2 million, and they all have parking, nice little yards, and bonus rooms or bonus-room potential.
They aren't fixers, but they have all have some (or much) potential for improvement. Such as 4090 25th St ($1.09M), 1617 Church ($995K), 3888 26th ($1.15M), 1308 Diamond ($949K). Then there's 1143 Diamond, which is perhaps overpriced at $1.398M. There are others, these are just the ones I've visited.
Also mentioned in our reader's inquiry was 4339 26th Street which hit the market in April for $1,650,000, was reduced to $1,450,000, and has now been withdrawn.
∙ Listing: 254 30th Street (2/2) - $1,250,000 [MLS]
Posted by socketadmin at 2:00 AM | Permalink | Comments (85) | (email story)
August 5, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 8/05/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco fell 1.4% over the past two weeks (a typical end of July drop) but remains 27% higher on a year-over-year basis.
Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 7/16/08 [SocketSite]
Posted by socketadmin at 7:50 AM | Permalink | Comments (44) | (email story)
August 4, 2008
Connecting The "Calling All Contractors" Dots (Starting In District 10)
From the listing for 190 Newton in District 10 (Crocker Amazon):
Seller has stopped work and is selling the property AS-IS. Warning - this property is not currently habitable. Permits and plans are available for Buyer inspection….Subject to lender approval of short sale….Money ran out in renovation.
From the listing for 139 Leese in District 9 (Bernal Heights):
Property in a state of complete disrepair….Not habitable at this point in time….Not for the faint of heart. This is rough. Subject to lender approval of short sale.
From the listing for 522 Chenery in District 5 (Glen Park):
[O]wner was in middle of remodel- no walls - down to studs- come take a look!
Can you connect the dots?
∙ Listing: 190 Newton - $399,000 [MLS]
∙ Listing: 139 Leese - $449,000 [MLS]
∙ Listing: 522 Chenery - $659,000 [MLS]
Posted by socketadmin at 1:00 PM | Permalink | Comments (24) | (email story)
Chase/U.S. Bank Crack Down On Jumbos, Sterling Bumps TIC Rates
Citing a “dramatic reduction in Jumbo volume levels,” “lack of Capital Markets appetite for Jumbo products,” and “worse than expected delinquency performance on these loans,” Chase is suspending “Non-Agency Fixed and ARM (Amortizing and Interest-Only) Product offerings within [their] Wholesale Lending Business.
At the same time, U.S. Bank is moving to a minimum of 20% down for interest only jumbo purchases and a “minimum of $250,000 of assets/reserves seasoned for a minimum of 60 days” for those refinancing an interest only jumbo loan with a loan to value of greater than 80%.
The TIC lending market just tightened this week. The low cost TIC lender in this market, Sterling, just raised all TIC rates by [50bps] this week and increased financial requirements for borrowers...[Editor’s Note: While our reader typed 500bps (5%), we’re assuming 50bps (0.5%) is what was meant.]
A few more buyers just got kicked out of the housing pool. Now about all those Econ101 and supply and demand lectures…
∙ Chase Suspends Non-Conforming Mortgages [SocketSite]
∙ Twelve New Tenancies In Common At Twenty-Two Hundred Beach [SocketSite]
Posted by socketadmin at 1:00 AM | Permalink | Comments (57) | (email story)
August 1, 2008
JustQuotes (And A Chart): Consumer Confidence Continues To Decline
"The U.S. economic slowdown has shaken the confidence of even the most affluent Americans as losses spread from housing to financial assets, according to economists at Merrill Lynch & Co.
'We are already seeing the dominoes fall because the well-heeled consumer is now seeing confidence decline at a much faster rate than everyone else (who are already washed out),' writes David A. Rosenberg, North American economist at Merrill Lynch in New York, in a July 29 commentary on the Conference Board's consumer confidence index.
The [Bloomberg] chart of the day shows the rapid decline in the Conference Board's index for Americans with incomes greater than $50,000. The 12-month rate-of-change rivals the descent seen in the year prior to January 1991."
∙ Rosenberg Says `Well-Heeled' Join the Pain: Chart of the Day [Bloomberg]
∙ Bloomberg chart of the day: Consumer confidence, incomes over $50,000 [Bloomberg]
Posted by socketadmin at 7:45 AM | Permalink | Comments (22) | (email story)
July 31, 2008
Have We Had Our "Cathartic Event" Or Are We Simply Late Bloomers?
The relatively good news for California:
Across the state, sales rose for three consecutive months starting in April after 30 straight months of declines, the California Association of Realtors said. About 40 percent of those transactions were foreclosure sales, DataQuick Information Systems reported. "California is having a wrenching decline in wealth, but this is a cathartic event that will lay the foundation for a recovery," said Mark Zandi, chief economist at Moody's Economy.com in West Chester, Pennsylvania, in an interview. "This signals the beginning of the end.''
The not so great news:
Almost $1.3 trillion of homeowner equity was lost in California since home prices peaked in December 2005, Zandi said. Discounts of as much as 50 percent will extend into 2010, helping clear a glut of foreclosures and leading to a more balanced housing market, said Ryan Ratcliff, an economist at the Anderson Forecast at the University of California in Los Angeles, and Christopher Thornberg, principal of Beacon Economics LLC in Los Angeles.
And the question: considering sales volume in San Francisco has actually declined over the past two months, and the number of foreclosures within the city remains rather nominal (but is growing), have we had our "cathartic event" or are we going to be late bloomers?
∙ California's Discount Foreclosure Sales Point to Housing Bottom [Bloomberg]
∙ San Francisco Recorded Sales Activity In June: Down 9.8% YOY [SocketSite]
∙ One Antithetical Quote To The “Foreclosures Aren’t Comps” Argument [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (14) | (email story)
July 29, 2008
May S&P/Case-Shiller: San Francisco MSA Declines (But Rate Slows)
According to the May 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 1.2% from April ’08 to May ’08 (the slowest rate of decline in eight months) and are down 22.9% year-over-year (a record low).
For the broader 10-City composite (CSXR), year-over-year price growth is down 16.9% (having fallen 1.0% from April).
For the month of May, markets that experienced large gains in the recent real estate boom continue to be the biggest decliners. Miami and Las Vegas were the worst performers returning -3.6% and -2.9%, respectively. On a brighter note, Charlotte and Dallas have recorded three consecutive months of positive returns. These two markets are also showing the smallest annual declines, with Charlotte down 0.2% and Dallas down 3.1% versus May of 2007. From a longer-term perspective, since January 2000, the best performing markets are Washington, Los Angeles, New York and Miami.
Both prices and the rate of decline continued to fall across the lower two price tiers for the San Francisco MSA while the upper tier recorded a slight month-over-month gain for the first time in nine months.
The bottom third (under $461,780 at the time of acquisition) fell 3.6% from April to May (down 38.8% YOY); the middle third fell 0.6% from April to May (down 26.1% YOY); and the top third (over $716,171 at the time of acquisition) rose 0.9% from April to May (down 8.7% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have returned to August 2002 levels, the middle third to January 2004 levels, and the top third continues to hold at March 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Record Low Annual Declines Recorded in May 2008 [S&P]
∙ April S&P/Case-Shiller: San Francisco MSA Declines Across All Tiers [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (199) | (email story)
July 25, 2008
U.S. New Home Sales Rate Moderates As Builders Deal
Existing home sales yesterday, new home sales today:
New-home sales in the U.S. in June were higher than forecast and the number of properties on the market dropped by the most in four decades, indicating builders are making some headway in clearing out inventories.
Purchases decreased 0.6 percent to a 530,000 pace, from an upwardly revised 533,000 in May, the Commerce Department said today in Washington....Builders are offering more incentives and lower prices to attract buyers and help reduce a glut of unsold properties. Still, stricter lending rules and rising mortgage rates may prevent sales from rising much more in coming months.
And a paragraph that shouldn't catch any plugged-in person by surprise:
The median sales prices last month decreased 2 percent from June 2007 to $230,900. These figures can be influenced by changes in the mix of sales at the regional level. For that reason, economists prefer price measures that track the same home over time.
SocketSite too. Apple Jacks for breakfast anyone?
∙ New-Home Sales in the U.S. Fell 0.6% to 530,000 Pace in June [Bloomberg]
∙ U.S. Home Resale Rate Falls To Ten Year Low (And 33% Below 2005) [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (24) | (email story)
July 24, 2008
U.S. Home Resale Rate Falls To Ten Year Low (And 33% Below 2005)
As we wrote in June when many seemed to get overly excited about a two point uptick in May’s previously owned home sales results:
And looking forward rather than back, "The Mortgage Bankers Association's index of loan applications to purchase homes fell last week to the lowest level in more than five years."
And from Bloomberg today:
Sales of previously owned U.S. homes fell in June to the lowest level in a decade as tumbling real- estate prices and consumer confidence signal no end in sight to a housing recession now in its third year.
Resales dropped 2.6 percent to a lower-than-forecast 4.86 million annual rate from a 4.99 million pace the prior month, the National Association of Realtors said today in Washington. The median home price dropped 6.1 percent from June of last year.
And regardless, the rate remains down 16% on a year-over-year basis (and down 33% versus the record breaking 2005).
∙ U.S. Economy: Sales of Existing Homes Decline to 10-Year Low [Bloomberg]
∙ U.S. Home Resales Up But Remain Off (As Do Mortgage Applications) [SocketSite]
Posted by socketadmin at 8:30 AM | Permalink | Comments (20) | (email story)
July 22, 2008
Actual Bay Area Foreclosures Up 314% (San Francisco Up 182%)
The good news, while Bay Area foreclosures (trustee deeds recorded) in the second quarter of 2008 were up over 314% on a year-over-year basis, actual foreclosures in San Francisco only increased 182% (up from 50 in Q2 2007 to 141 in 2008). Of course that’s the bad news as well.
In the Bay Area, the biggest increase in the rate of new foreclosures occurred in Santa Clara (up 511.8% from 255 to 1,560), while the biggest increase in volume occurred in Contra Costa (from 777 new foreclosures in Q2 2007 to 2,965 in 2008).
Statewide and in terms of new notice of default (NOD) activity (up 62.6% on a year-over-year basis in San Francisco): "Most of the loans that went into default last quarter were originated between September 2005 and November 2006. The median age was 26 months, up from 16 months a year earlier."
In other words, the low lying foreclosure fruit has been picked and we’re now moving on to those who were better capitalized.
∙ Another Increase in California Foreclosure Activity [DQNews]
Posted by socketadmin at 12:15 PM | Permalink | Comments (49) | (email story)
July 17, 2008
San Francisco Recorded Sales Activity In June: Down 9.8% YOY
According to DataQuick, home sales volume in San Francisco fell 9.8% on a year-over-year basis last month (571 recorded sales in June ’08 versus 633 sales in June ‘07) and fell 3.7% compared to the month prior (See UPDATE below).
Keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
San Francisco's median sales price in June was $726,750, down 11.9% compared to June ’07 ($825,000), 8.0% compared to the month prior, and the lowest recorded median since March 2005. And yes, we're doing some digging on the effect of mix.
For the greater Bay Area, recorded sales volume in June was down 9.9% on a year-over-year basis but increased 15.5% from the month prior (7,178 recorded sales in June '08 versus 7,964 in June ’07 and 6,216 in May '08). And the recorded median sales price fell 27.1% on a year-over-year basis (down 6.2% compared to the month prior and "the first time in more than four years that it was below the half-million mark").
At the extremes, Marin recorded a 35.4% year-over-year reduction in sales volume (a loss of 124 transactions) and a 12.0% decrease in median sales price, while Contra Costa recorded a 14.6% drop in sales volume (a loss of 207 transactions) and a 36.7% drop in median sales price.
UPDATE: In our words this morning, it "seems a little strange" that sales volume would have been absolutely flat from May to June. And lo and behold, DataQuick has since adjusted the number down from 593 to 571 sales in June.
∙ Bay Area median price dives below $500K; sales near record low [DQNews]
∙ San Francisco Recorded Sales Activity In May: Down 3.7% YOY [SocketSite]
Posted by socketadmin at 10:51 AM | Permalink | Comments (167) | (email story)
July 16, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 7/16/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco remained relatively flat (down 0.3%) over the past two weeks and is currently running 27% higher on a year-over-year basis.
Once again, we still haven't seen a significant post Memorial Day bump in inventory but new listing activity has picked up while sales volume has slowed (how much simply due to the July 4th holiday weekend is yet to be seen). And as a measure of mismatched "expectations," while listing volume is up 27% year-over-year, the volume of Active listings which have undergone at least one price reduction is up 70%.
Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/30/08 [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (35) | (email story)
July 9, 2008
One Antithetical Quote To The “Foreclosures Aren’t Comps” Argument
An anecdotal quote that runs somewhat antithetical to the “foreclosures aren’t comps” argument:
"Our experience is the bank has a number (the asking price); they will hold that for a while," [Re/Max Realtor-broker Joe Metz] said. "If they don't get that number for three or four weeks, they will lower the price a little more. Banks are very smart about how they do this. They move them very quickly and for about as much as anybody could get."
Granted, it's from an East Bay broker where foreclosure activity continues to be significantly more meaningful than in San Francisco, but the trend is up across the board.
Also up, the ratio of properties that receive a notice of default (NOD) that eventually become bank owned (REO). A sign of dropping values, not only financial duress.
∙ How to buy a foreclosed home [SFGate]
Posted by socketadmin at 9:00 AM | Permalink | Comments (2) | (email story)
July 8, 2008
Alt-A Powerhouse IndyMac Takes A Step Closer To IndyDependance
As another plugged-in reader noted yesterday, IndyMac – second only to Countrywide in terms of indypendent U.S. mortgage lenders last year – has effectively stopped originating new home loans citing a “continued downward trend in home prices” (think losses and need to raise additional capital) and a lack of “stability and uncertainty” in the mortgage markets (think inability to raise said capital).
Keep in mind that IndyMac is the largest “Alt-A” – not subprime – lender in the land.
∙ Indymac Issues Stakeholder Letter [The IMB Report]
∙ JustQuotes: You Had Better Watch Your Fannie (As Well As Freddie) [SocketSite]
Posted by socketadmin at 6:45 AM | Permalink | Comments (25) | (email story)
July 7, 2008
JustQuotes: You Had Better Watch Your Fannie (As Well As Freddie)
“Freddie Mac and Fannie Mae plunged in New York trading and their credit-default swaps rose as concerns grew the two largest U.S. mortgage-finance companies may need to raise more capital to overcome writedowns and satisfy new accounting rules.”
“As mortgage delinquencies grow at a record pace, the companies likely will take further losses, [Deutsche Bank credit strategist John Tierney] said. Banks repossessed twice as many homes in May as they did a year ago and foreclosure filings rose 48 percent, according to RealtyTrac Inc., a real estate database in Irvine, California. Home prices in 20 U.S. metropolitan areas fell 15.3 percent in April by the most on record, S&P/Case-Shiller home-price index.”
"Spreads between 10-year Treasuries and bonds backed by Fannie Mae reached a 22-year high of 238 basis points on March 6. An increase boosts the cost of new mortgages for the most creditworthy consumers. A basis point is 0.01 percentage point."
∙ Freddie Mac, Fannie Mae Plunge on Capital Concerns [Bloomberg]
∙ Fannie Mae To Market: It’s Not Getting Better, But Rather Worse [SocketSite]
∙ April S&P/Case-Shiller: San Francisco MSA Declines Across All Tiers [SocketSite]
∙ Agency Mortgage-Bond Yield Spreads Rise on Potential Bank Sales [Bloomberg]
Posted by socketadmin at 11:45 AM | Permalink | Comments (12) | (email story)
Foreclosure Activity In San Francisco As Mapped By Trulia: 7/07/08
Over the past five months the number of San Francisco properties in some stage of foreclosure as mapped by Trulia has increased from 409 to 782, and is up from 215 seven months ago.
And once again, while the majority of mapped properties remain in District 10 (and at this point have only received notices of default), as a plugged-in reader points out, “the shift to the southwest continues and is now pushing farther north as well.”
It’s an imperfect measure for sure (and for all we know better reporting could be playing a part in the increase), but it's not completely irrelevant.
∙ Foreclosure Activity In San Francisco As Mapped By Trulia: 2/07/08 [SocketSite]
∙ Current Foreclosure Activity In San Francisco As Mapped By Trulia [SocketSite]
Posted by socketadmin at 4:45 AM | Permalink | Comments (26) | (email story)
July 1, 2008
Listed Sales Activity In San Francisco: Down 25-30% In June (YOY)
As you know, San Francisco’s inventory of listed single-family homes, condos, and TICs is currently running 34% higher on a year-over-year basis. As you might not know, on a year-over-year basis sales activity of said homes is running 25-30% lower. From another plugged-in reader:
Total MLS sales for June stand at 381 (at this moment) with an overall median price of $799K. June 2007 had 545 sales at a median of $830K. Jun06 - 617 sales @ $799K, Jun05 - 656 sales @ $800K, Jun04 - 708 sales @ $717K.
The official sales count for June will increase as listings for end of the month transactions are updated (hence our 25-30% range), but the significant downward trend over the past four years will hold true (the rate of which has been increasing rather than decreasing).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/30/08 [SocketSite]
Posted by socketadmin at 10:51 AM | Permalink | Comments (48) | (email story)
June 30, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 6/30/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco decreased 1.4% over the past two weeks and is currently running 34% higher on a year-over-year basis.
We still haven't seen a significant post Memorial Day bump in inventory and new listing volume is down on a year-over-year basis, but sales volume has started to slow as well. And perhaps as a measure of mismatched "expectations," thirty-three percent (33%) of current listings have undergone at least one price reduction versus twenty-six percent (26%) at the same time last year.
Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/16/08 [SocketSite]
Posted by socketadmin at 8:45 AM | Permalink | Comments (20) | (email story)
June 26, 2008
U.S. Home Resales Up But Remain Off (As Do Mortgage Applications)
While previously owned U.S. home sales ticked up two points in May to an annualized rate of 4.99 million sales, on a year-over-year basis sales remain off by 16 percent, the median sales price dropped 6.3%, and the increase is compared to the month prior which “matched a record low for existing home sales.”
A drop in property values may have spurred demand in some of the most distressed areas, such as California and the Midwest. Even so, rising mortgage rates, a glut of unsold homes, and stricter borrowing rules indicate the real estate recession will persist for most of the year.
And looking forward rather than back, "The Mortgage Bankers Association's index of loan applications to purchase homes fell last week to the lowest level in more than five years."
∙ Home Resales in U.S. Rose to 4.99 Million Rate in May [Bloomberg]
Posted by socketadmin at 8:00 AM | Permalink | Comments (0) | (email story)
June 24, 2008
OFHEO: California Leads U.S. House Price Declines (YOY) In Q1 2008
According to the OFHEO’s first quarter 2008 House Price Index (HPI), California registered the sharpest year-over-year depreciation (-10.6%) of any state; Merced, Stockton and Modesto registered the sharpest year-over-year depreciation of all MSAs (-24.7%, -21.5%, and -21.0% respectively); and the San Francisco MSAD registered year-over-year depreciation of 3.25% (accelerating from a 0.9% YOY drop in 2007).
Both OFHEO’s purchase-only index and its all-transactions index show much more muted price declines than do other house price indexes. “While house price declines are widespread, homes financed with prime, conforming mortgages continue to hold up better than those financed with other types of mortgages, a phenomenon we’ve been observing for the last several quarters,” [OFHEO Director James Lockhart] said.
For those who are unfamiliar, the OFHEO House Price Index (HPI) is based on data from repeat single-family home sales or refinancings that involve conforming mortgages. Data from transactions involving either condominiums or non-conforming loans (two major components of the San Francisco market) are excluded from the Index.
∙ Decline In House Prices Accelerates In First Quarter [OFHEO]
∙ Are We Detached From More Than Simply The Fundamentals? [SocketSite]
∙ April S&P/Case-Shiller: San Francisco MSA Declines Across All Tiers [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (5) | (email story)
April S&P/Case-Shiller: San Francisco MSA Declines Across All Tiers
According to the April 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 2.2% from March ’08 to April ’08 and are down 22.1% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 16.3% (having fallen 1.6% from March).
Las Vegas and Miami continue to share the dubious distinction of being the weakest markets over the past 12 months returning -26.8% and -26.7% respectively. These two markets witnessed some of the fastest growth in the 2004/2005 periods, with annual growth rates peaking above +53% and +32% respectively.
Prices fell across all three price tiers for the San Francisco MSA with the rate of decline slowing slightly at the bottom end and increasing slightly at the top.
The bottom third (under $473,711 at the time of acquisition) fell 4.7% from March to April (down 37.2% YOY); the middle third fell 2.3% from March to April (down 25.7% YOY); and the top third (over $721,548 at the time of acquisition) fell 0.2% from March to April (down 9.2% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have returned to February 2003 levels, the middle third to February 2004 levels, and the top third continues to hold at March 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Steep Declines in Home Prices Continued in April 2008 [S&P]
∙ March S&P/Case-Shiller: San Francisco MSA Declines, Top Tier Flat [SocketSite]
Posted by socketadmin at 6:45 AM | Permalink | Comments (64) | (email story)
June 20, 2008
California Unemployment: We’re Still The Best (But The Bloom Is Off)
The unemployment rate in California jumped 0.6 perentage point in May to 6.8%, "the largest one-month increase since the state began keeping records in 1976." The San Fransciso MSA, however, remains a relative - but not necessarily absolute - stalwart.
In the San Francisco metropolitan area, which includes Marin and San Mateo counties, unemployment was 4.6 percent in May, up from 4.2 percent the month before. In the San Jose area, the rate rose to 5.6 percent from 5.2 percent. And in the Oakland area, including Contra Costa and Alameda counties, unemployment was 5.7 percent, up from 5.3 percent.
"The Bay Area still is the best part of the California economy," said Howard Roth, principal economist for the California Finance Department. "But the bloom is off the rose."
∙ State records biggest jump in unemployment in May [SFGate]
Posted by socketadmin at 2:15 PM | Permalink | Comments (9) | (email story)
June 18, 2008
San Francisco Recorded Sales Activity In May: Down 3.7% YOY
According to DataQuick, home sales volume in San Francisco fell 3.7% on a year-over-year basis last month (593 recorded sales in May ’08 versus 616 sales in May ‘07) and fell 2.0% compared to the month prior.
Keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
San Francisco's median sales price in May was $790,000, down 5.4% compared to May ’07 ($835,000) but up 5.3% compared to the month prior. And yes, we continue to see mix supporting the median in San Francisco proper.
For the greater Bay Area, recorded sales volume in May was down 23.1% on a year-over-year basis (the slowest May in at least twenty years) and fell 1.5% from the month prior (6,216 recorded sales in May '08 versus 8,080 in May ’07 and 6,310 in April '08). And the recorded median sales price fell 21.7% on a year-over-year basis (down 0.2% compared to the month prior).
At the extremes, Marin recorded a 37.0% year-over-year reduction in sales volume (a loss of 133 transactions) but a 5.8% increase in median sales price (the only Bay Area county to record an increase), while Contra Costa recorded a 11.7% drop in sales volume (a loss of 160 transactions) and a 33.8% drop in median sales price.
∙ Bay Area home sales return to record low in May [DQNews]
∙ San Francisco Recorded Sales Activity In April: Up 6.5% YOY [SocketSite]
Posted by socketadmin at 10:15 AM | Permalink | Comments (30) | (email story)
June 16, 2008
Homebuilder Confidence Falls: From The Fringes To San Francisco?
A plugged-in reader reports (and posits):
I was on a conference call today with the National Association of Home Builders (NAHB) CEO Jerry Howard and Chief Economist David Seiders where they were presenting the June Housing Market Index (HMI).
It was pretty bad. They were basically pleading with all news organizations and others to put pressure on the federal government to bail out the housing meltdown.
Jerry even went so far as to say that it is effecting senior citizens and it is just not right that they are losing their equity.
The NAHB reported that the index is at an all time record low of 18. Down from 19 in May. (a rating of 50 is neutral, greater than 50 means a majority of positive responses. less than 50 means a majority of negative)
David did say that he expects further declines since the current index does not reflect the recent rise in interest rates.
I really wish I could describe in words the sense of desperation that came from the call.
It seems easy to look at particular neighborhoods and say that a major downturn is not coming but I would have to agree with those whom have studied bubble and mass movement mentality. The drastic movement starts at the fringes and moves in over time.
Stockton -> Contra Costa -> Specific Districts in SF -> Top of Russian Hill
If we look back in 5 years I will be very surprised if those prime districts have not followed suit.
∙ Homebuilder Confidence Index Unexpectedly Fell to 18 [Bloomberg]
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/16/08 [SocketSite]
Posted by socketadmin at 1:45 PM | Permalink | Comments (34) | (email story)
SocketSite's San Francisco Listed Housing Inventory Update: 6/16/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco slightly decreased (0.7%) over the past two weeks and is currently running 30% higher on a year-over-year basis.
A typical post Memorial Day bump in inventory has yet to materialize as on a year-over-year basis new listing volume is down, and in addition, sales volume is up.
Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/2/08 [SocketSite]
Posted by socketadmin at 7:15 AM | Permalink | Comments (84) | (email story)
June 12, 2008
The One To Watch With Respect To Most Mortgage Rates Ticks Up
“Treasuries fell, pushing the yield on the benchmark 10-year note to the highest level this year, after a larger-than-expected gain in retail sales bolstered the case for the Federal Reserve to boost interest rates....Futures on the Chicago Board of Trade show odds of 22 percent the Fed will raise the target rate for overnight lending between banks by at least a quarter-percentage point to 2.25 percent at its June 25 meeting. The probability of an increase by year-end is 100 percent.”
[Editor’s Note: In case it wasn’t clear, it's the 10-year Treasury that's the one to watch.]
∙ Treasury 10-Year Note Yields Rise to Year High on Retail Sales [Bloomberg]
Posted by socketadmin at 9:15 AM | Permalink | Comments (15) | (email story)
June 9, 2008
Seasonality, Surprises, And Avoiding Looking Like A Schmuck
“The index of [U.S.] pending home resales rose 6.3 percent to 88.2, the highest level in six months, following a 1 percent drop in March, the National Association of Realtors said today in Washington. [A Bloomberg poll projected the index would fall 0.4 percent.]
The drop in property values may be starting to lure some buyers who are able to qualify for loans, signaling purchases will improve in 2009. Still, stricter lending rules, the recent increase in mortgage rates and continued pressure on prices from mounting foreclosures will probably keep some buyers away for much of the year.”
“’What people are most scared of is looking like a schmuck,’ Toll Brothers Holdings Inc. Chief Executive Officer Robert Toll said at a conference in New York last week. ‘What do I want to buy a home for and next year be looking at 10 percent less asset?’”
∙ Pending Home Resales in U.S. Unexpectedly Increased [Bloomberg]
Posted by socketadmin at 7:41 AM | Permalink | Comments (12) | (email story)
June 5, 2008
U.S. Foreclosure Activity Continues To Climb Rather Than Fall
“New foreclosures rose to a seasonally adjusted 0.99 percent of all U.S. home loans, up from 0.83 percent in the fourth quarter, the Mortgage Bankers Association said in a report today. The total inventory of homes in foreclosure increased to 2.47 percent and the delinquency rate, loans with one or more payments overdue, grew to 6.35 percent. All were the highest since 1979, the Washington-based trade group said.”
“Prime adjustable-rate mortgages in California, the largest U.S. state, accounted for 36 percent of all U.S. foreclosures started during the period. The state's subprime adjustable loans were 26 percent of the national total.”
∙ U.S. Mortgage Delinquencies, Foreclosures Rise to 29-Year High [Bloomberg]
Posted by socketadmin at 8:20 AM | Permalink | Comments (33) | (email story)
June 4, 2008
The Early MLS Count For May: Listed Sales Down 18% Year-Over-Year
According to a plugged-in reader the early count for listed sales volume of single-family homes, condos, and TICs in San Francisco last month is currently running 18% under that of May 2007 (29% under May 2004). Expect a slight bump for late reportings.
Keep in mind that listed sales volume was down 13% on a year-over-year basis the month prior (April) while recorded sales volume was up 6.5% (think new construction closings). And listed inventory is currently up 45% year-over-year.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 6/2/08 [SocketSite]
∙ San Francisco Recorded Sales Activity In April: Up 6.5% YOY [SocketSite]
Posted by socketadmin at 12:30 PM | Permalink | Comments (27) | (email story)
June 2, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 6/2/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased slightly (1%) over the past two weeks and is currently running 45% higher on a year-over-year basis. Housing inventory typically declines over the last couple of weeks of May but once again starts to build in June as the school year ends and the summer selling season starts in earnest.
Thirty percent of Active listings have experienced at least one price adjustment versus twenty-three percent at the same time last year.
Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor does it include listings for multi-family properties (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 5/12/08 [SocketSite]
Posted by socketadmin at 7:30 AM | Permalink | Comments (37) | (email story)
May 27, 2008
March S&P/Case-Shiller: San Francisco MSA Declines, Top Tier Flat
According to the March 2008 S&P/Case-Shiller Home Price Index (pdf) , single-family home prices in the San Francisco MSA fell 3.5% from February '08 to March ’08 and are down 20.2% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 15.3% (having fallen 2.2% from February).
The decline in the S&P/Case-Shiller U.S. National Home Price Index – which covers all nine U.S. census divisions – reached well into double digits, recording a 14.1% decline in the 1st quarter of 2008 versus the 1st quarter of 2007, the largest in the series 20-year history. As a comparison, during the 1990-91 housing recession the annual rate bottomed at -2.8%. The 10-City and 20-City Composites also set new records, with annual declines of -15.3% and -14.4%, respectively.
Prices fell across the bottom two price tiers for the San Francisco MSA, while the top tier remained unchanged on a month-over-month basis but declined 2.0% year-over-year.
The bottom third (under $489,431 at the time of acquisition) fell 5.3% from February to March (down 34.7% YOY); the middle third fell 4.5% from February to March (down 23.9% YOY); and the top third (over $734,115 at the time of acquisition) fell 0.04% from February to March (down 8.0% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have returned to June 2003 levels, the middle third to March 2004 levels, and the top third is holding at March 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ National Trend of Home Price Declines Continued into the First Quarter of 2008 [S&P]
∙ February S&P/Case-Shiller: San Francisco MSA Decline Accelerates [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (114) | (email story)
May 20, 2008
San Francisco Recorded Sales Activity In April: Up 6.5% YOY
According to DataQuick, home sales volume in San Francisco climbed 6.5% on a year-over-year basis last month (605 recorded sales in April ’08 versus 568 sales in April ‘07) and increased 19.1% compared to the month prior (in part due to seasonaility, but also a significantly stronger gain than compared to the past couple of years).
That being said, do keep in mind that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded).
The median sales price in April was $750,000, down 5.1% compared to April ’07 ($790,000) and down 0.7% compared to the month prior. We continue to see mix supporting the median in San Francisco proper.
For the greater Bay Area, recorded sales volume in April was down 15.3% on a year-over-year basis but increased 28.8% from the month prior (6,310 recorded sales in April '08 versus 7,447 in April ’07 and 4,898 in March '08). And the recorded median sales price fell 21.4% on a year-over-year basis (down 3.4% compared to the month prior).
Foreclosure property resales accounted for 25.7 percent of last month's Bay Area market. The percentage is higher in outlying areas that absorbed spillover activity during the frenzy. While foreclosure properties were 5.9 percent of San Francisco's resale market and 8.9 percent of Marin's resale market last month, they were 44.7 percent in Contra Costa and 54.2 percent in Solano.
At the extremes, Marin recorded a 31.0% year-over-year reduction in sales volume (a loss of 97 transactions) and a 13.5% drop in median sales price, Santa Clara recorded a 28.3% reduction in sales volume (a loss of 569 transactions) and a 13.3% drop in median sales price, and Contra Costa recorded a 1.5% increase in sales volume (a gain of 19 transactions) and a 34.2% drop in median sales price.
CORRECTION: “Foreclosure resales” had previously been misidentified as “sales back to the bank.” For the purposes of the DataQuick sales report “foreclosure resales” only includes the sales of properties which had previously been recorded as foreclosures within the past twelve months.
∙ Bay Area home sales edge up in April [DataQuick]
∙ San Francisco Recorded Sales Activity In March: Down 20.6% YOY [SocketSite]
Posted by socketadmin at 11:30 AM | Permalink | Comments (55) | (email story)
First Republic Prestige Home Index For “San Francisco” Falls (Again)
According to the First Republic Prestige Home Index for “San Francisco,” values for properties worth at least $1 million fell for the second straight quarter (down 0.8% from Q4 ’07) but remain up 2.9% on a year-over-year basis.
Keep in mind, however, that the Prestige Home Index for “San Francisco” includes eight Bay Area counties. And in a nod to a microcosm of mix (which shouldn’t affect the Index, but will affect the median sales price): “The higher end of the luxury market is the most active."
∙ Prestige Home Index: San Francisco [First Republic]
Posted by socketadmin at 10:53 AM | Permalink | Comments (6) | (email story)
May 16, 2008
Washington Mutual Goes With The Flow To Tighten HELOC Lending
Three months ago we let you know it was coming. Last week Wells Fargo made the move (tightening local lending standards for HELOCs). And according to the San Francisco Business Times, Washington Mutual appears to be following suit:
Washington Mutual Inc. has slashed or suspended $6 billion in available home equity credit to its customers in an effort to reduce its risk in a flailing housing market.
If they haven't already been notified, WaMu's customers across the country will learn of the change to their credit availability in a letter mailed to them in the next several days. The bank declined to disclose how many customers will be affected.
If a borrower's home has depreciated -- regardless of credit history -- the line of credit will likely be reduced because the equity has fallen.
That last sentence seems like common sense (although that hasn’t necessarily been a prerequisite for lending over the past five years), and unfortunately we don’t have any additional details. If any plugged-in readers should happen to receive one of said letters, please feel free to pass it along (tips@socketite.com). You know we'd do the same for you.
∙ When Hell HELOCs Freeze Over... [SocketSite]
∙ Wells Fargo Tightens Local Lending Standards For HELOCs [SocketSite]
∙ WaMu reduces home equity credit to homeowners [Business Times]
Posted by socketadmin at 3:44 PM | Permalink | Comments (1) | (email story)
May 15, 2008
You Like It In San Francisco. You Really, Really Do! (Then Again...)
“Thousands of new technology industry and other professional jobs and a burst of new housing construction attracted more new residents to San Francisco in 2007 than in any year in nearly a decade and drove the city's population to a new high of more than 824,000.” (New jobs, houses spur S.F. population in 2007)
UPDATE: A plugged-in reader’s comment worth highlighting (and considering): “[T]hose of you who didn't notice that this "study" had SF area GAINING population -- by 18,000! -- from the peak of the dot com boom to the bust, shame on you. We all lived through that and know it didn't happen, and San Mateo got hit just as hard and Marin certainly didn't make up the difference. Why on earth you think the more recent population "gains" this study is reporting are any more realistic is just beyond me. 100,000 jobs get lost but SF gains population? Please."
Posted by socketadmin at 6:45 AM | Permalink | Comments (170) | (email story)
May 14, 2008
Subprime And Alt-A Statistics By County: The Feds Mortgage Map
Well, while a plugged-in tipster directed us to the site last week (cheers), another plugged-in reader steals a bit of our thunder and forces a pre-analysis publication by pointing it out this afternoon (yes, cheers as well). It’s the Federal Reserve's "Dynamic Maps of Nonprime Mortgage Conditions in the United States.”
Our thoughts will now have to follow (hopefully later this week), but a couple of hints as to what to see: December to January changes; San Francisco versus Contra Costa; and Subprime versus Alt-A. Remember, San Francisco is more an Alt-A than Subprime town.
∙ Dynamic Maps of Nonprime Mortgage Conditions in the United States [New York Fed]
Posted by socketadmin at 4:47 PM | Permalink | Comments (20) | (email story)
Foreclosure "Activity" Dips Slightly In California (But Foreclosures Up)
According to RealtyTrac, while foreclosure activity across the U.S. increased 4 percent from March to April (and is up almost 65 percent on a year-over-year basis), activity decreased slightly in both Nevada (home to the nation’s highest state foreclosure rate) and California (which sports the nation’s second highest foreclosure rate) on a month-over month basis.
Despite a 5 percent month-over-month decrease in foreclosure activity in April, Nevada continued to document the nation’s highest state foreclosure rate. One in every 146 Nevada households received a foreclosure filing in April, 3.6 times the national average, and the state’s foreclosure activity was up 95 percent from April 2007.
California posted the second highest state foreclosure rate in April, with one in every 204 households receiving a foreclosure filing during the month. Foreclosure filings were reported on 64,683 California properties in April, down [0.04] percent from the previous month but still the most of any state and an increase of 112 percent from April 2007.
That being said, the number of homes that were actually foreclosed upon (versus foreclosure "activity") increased 11% in California from March (14,025) to April (15,567).
And six California cities ranked in the top 10 (in terms of foreclosure rates) among the 230 metropolitan areas tracked by RealtyTrac: Merced (#1), Stockton (#2), Modesto (#3), Riverside-San Bernardino (#4), Vallejo-Fairfield (#6) and Bakersfield (#8).
∙ Foreclosure Activity Increases 4 Percent In April [RealtyTrac]
Posted by socketadmin at 9:45 AM | Permalink | Comments (35) | (email story)
May 13, 2008
While Libor Heads Up, Jumbo-Conforming Rates Head Down
While Libor has been heading up amid complaints "that financial institutions weren't telling the truth about their funding costs after rising mortgage defaults contaminated credit markets and drove up borrowing costs," jumbo-conforming rates have been heading down following Fannie Mae's decision to raise their purchase price for the loans last Tuesday.
From Julian Hebron at RPM:
The [jumbo-conforming] rate drop [of about 0.5% over the past week] is good news, but approval guidelines for these loans are strict. Borrowers must have at least 10% equity, or at least 15% equity if their property is a designated declining market—even San Francisco and Marin Counties are on many lenders’ declining lists. Cash-out loans require 25% equity, and cash-out is limited to $100k. Loans require full documentation, 1-unit properties only (condos ok), debt-to-income ratios of 45% or lower, and 700 minimum credit scores.
Fannie Mae has said they may announce less stringent guidelines as soon as this week, but all lenders can overlay their own risk-control guidelines and rate premiums beyond what Fannie Mae (or Freddie Mac) may require.
With the rate drop, jumbo-conforming mortgages are now being offered for around 6.25%. That’s a 0.625% (62.5 bps) discount to jumbo rates (6.875%) and only a 0.25% (25 bps) premium over conforming (6.0%).
∙ Libor Set for Overhaul as Credibility Is Doubted [Bloomberg]
∙ If Lowering Rates Isn’t Working, Perhaps Increasing Limits Will [SocketSite]
∙ Mortgage Rate/Spread Update: Are You Feeling Stimulated Yet? [SocketSite]
Posted by socketadmin at 11:30 AM | Permalink | Comments (15) | (email story)
May 12, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 5/12/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 3% over the past two weeks (37% higher on a year-over-year basis) while listed sales volume appears to have slightly slipped. Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor do they include multi-family listings (unless the units are individually listed).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 4/28/08 [SocketSite]
Posted by socketadmin at 6:30 AM | Permalink | Comments (31) | (email story)
May 9, 2008
Wells Fargo Tightens Local Lending Standards For HELOCs
Three months ago we alerted you to a trend in lending to tighten up on Home Equity Lines of Credit (HELOCs), so please don’t let us hear that any plugged-in readers have been caught unprepared or by surprise.
The latest local news: Wells Fargo has “lowered the maximum loan-to-value to 75 percent from 80 percent on mortgages involving an equity line of credit for houses in Marin, San Francisco and San Mateo counties.”
∙ When Hell HELOCs Freeze Over... [SocketSite]
∙ Wells tightens standards for home equity lines [Business Times]
Posted by socketadmin at 8:15 AM | Permalink | Comments (22) | (email story)
May 5, 2008
Mortgage Rate/Spread Update: Are You Feeling Stimulated Yet?
According to Julian Hebron at RPM, local 30-year jumbo-conforming mortgages are currently being offered for around 6.625%. That’s a 0.25% (25 bps) discount to jumbo rates (6.875%) but a 0.625% (62.5 bps) premium over conforming (6.0%).
∙ If Lowering Rates Isn’t Working, Perhaps Increasing Limits Will [SocketSite]
Posted by socketadmin at 2:37 PM | Permalink | Comments (12) | (email story)
April 29, 2008
Perspective On California Foreclosures And The Current Housing Cycle
Get over the source of the graph (Bubble Markets Inventory Tracking) and the fact that the epicenter of foreclosure activity is centered down south (at least currently), it’s still relevant perspective regarding this housing cycle (and at some level will most likely matter to you).
And while foreclosures did only account for 5% of all resales in San Francisco County (not MSA) last quarter versus 33% Statewide, do keep in mind that’s two points higher than what was recorded Statewide in the first quarter of 2007 (3%).
∙ CA Foreclosures 2008 Q1 [Bubble Markets Inventory Tracking]
∙ California home foreclosures hit a record [Los Angeles Times]
∙ Yes, The Greater California Housing Market Does Matter To You [SocketSite]
Posted by socketadmin at 1:00 PM | Permalink | Comments (19) | (email story)
February S&P/Case-Shiller: San Francisco MSA Decline Accelerates
According to the February 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 5.0% from January '08 to February ’08 and are down 17.2% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 13.6% (having fallen 2.8% from January).
For the month of February, markets in the West were the biggest decliners. San Francisco [-5.0%], Las Vegas [-4.8%], and Los Angeles [-4.3%] were the worst performers. Each had a negative return in excess of 4%. Charlotte remains the only market that has a positive return over the past 12 months, but it too has seen negative returns in each of the last six months and is in the midst of growth deceleration.
Prices fell across all three price tiers for the San Francisco MSA with the rate of decline accelerating across the board.
The bottom third (under $513,218 at the time of acquisition) fell 5.9% from January to February (down 32.0% YOY); the middle third fell 5.9% from January to February (down 20.6% YOY); and the top third (over $756,420 at the time of acquisition) fell 2.5% from January to February (down 6.0% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have returned to December 2003 levels, the middle third to May 2004 levels, and the top third to March 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
UPDATE: Back by popular demand, the San Francisco price tiers plotted logarithmically:
∙ Steep Declines in Home Prices Continued in February 2008 [Standard & Poor’s]
∙ January S&P/Case-Shiller: San Francisco MSA Continues Decline [SocketSite]
Posted by socketadmin at 6:16 AM | Permalink | Comments (113) | (email story)
April 28, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 4/28/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 5% over the past two weeks and is currently running 36% higher on a year-over-year basis. Keep in mind that our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor do they include multi-family listings (unless the units are individually listed).
And once again, while recorded sales activity was off by a little over 20% last month (on a year-over-year basis), listed sales activity was off by over 30%.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 4/14/08 [SocketSite]
∙ San Francisco Recorded Sales Activity In March: Down 20.6% YOY [SocketSite]
Posted by socketadmin at 8:00 AM | Permalink | Comments (55) | (email story)
April 24, 2008
U.S. New-Home Sales Slide Plunge To Near Seventeen Year Low
“Purchases of new homes in the U.S. plunged more than forecast in March to the lowest level in almost 17 years as stricter loan rules and falling prices caused buyers to hold off. Sales dropped 8.5 percent to an annual pace of 526,000, the fewest since October 1991, from a 575,000 rate the prior month....”
∙ New-Home Sales in the U.S. Plunge More Than Forecast [Bloomberg]
∙ U.S. Existing-Home Sales Slide (This Time Despite The Seasonality) [SocketSite]
Posted by socketadmin at 10:00 AM | Permalink | Comments (44) | (email story)
April 22, 2008
AIG United Guaranty Cuts Condominium Coverage In…San Francisco
As both tipsters and readers alike have noted, as of next month a major private mortgage insurer will no longer write coverage for condominiums in “declining” markets. And as far as AIG United Guaranty is concerned, that includes San Francisco. Yes, proper.
[S]tarting May 1, AIG United Guaranty…no longer will write coverage on condominiums in hundreds of ZIP codes across the country that it designates as having "declining" market conditions. The ban is irrespective of applicants' credit scores, assets or equity stakes. Even in the healthiest real estate markets, United Guaranty will require buyers to put at least a 10 percent down payment into the deal, and will reject applications on units in condo projects where more than 30 percent of the owners are investors.
Of course AIG is but one insurer. And over the past seven years or so an increasing number of condo buyers turned to piggyback mortgages to avoid PMI altogether. But with ever tightening lending standards, and increasing rates for second mortgages, we just might see a resurgence in use throughout San Francisco. Then again, if other insurers follow suit, perhaps not.
∙ Condo-loan restrictions tightening [Baltimore Sun]
∙ AIG United Guaranty’s Declining Markets List (pdf) [ugcorp.com]
Posted by socketadmin at 11:26 AM | Permalink | Comments (37) | (email story)
U.S. Existing-Home Sales Slide (This Time Despite The Seasonality)
The pace of U.S. existing-home sales fell in March to a seasonally adjusted rate of 4.93 million units. That’s down 2.0 percent from the month prior and down 19.3% from the pace of a year prior. Median sales price is down 7.7% (YOY).
Huh. So much for that February “recovery.” And perhaps that wacky housing market is somewhat seasonal after all. Who knew.
∙ Existing-Home Sales Slip in March [NAR]
∙ The Good And The Bad (But Not Necessarily The Ugly) [SocketSite]
Posted by socketadmin at 8:00 AM | Permalink | Comments (27) | (email story)
April 17, 2008
San Francisco Recorded Sales Activity In March: Down 20.6% YOY
According to DataQuick, home sales volume in San Francisco dropped 20.6% on a year-over-year basis last month (508 recorded sales in March ’08 versus 640 sales in March ‘07). And while sales volume increased 17.9% compared to the month prior (think seasonaility), in 2004 sales volume in San Francisco jumped 39.4% from February to March, in 2005 it jumped 38.9%, in 2006 it jumped 47.1%, and in 2007 it jumped 70.7%.
As we pointed out last month, however, it’s important to understand that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed ("sold") many months or even years prior and are just now closing escrow (or being recorded). Early reports of sales activity for listed properties in San Francisco would suggest a closer to 30% year-over-year decline for existing property sales.
The median sales price in March was $755,000, up a negligible 0.3% compared to March ’07 ($752,800) and up 2.6% compared to the month prior. That being said, we continue to see mix playing a significant role in supporting the median sales price in San Francisco.
For the greater Bay Area, sales volume in March was down 41.1% on a year-over-year basis but increased 22.8% from the month prior (4,898 recorded sales in March '08 versus 8,317 in March ’07 and 3,989 this past February). And the recorded median sales price fell 16.1% on a year-over-year basis (down 2.2% compared to the month prior).
At the extremes, Marin recorded a 48.8% year-over-year reduction in sales volume (a loss of 141 transactions) and a 4.4% drop in median sales price; Alameda recorded a 47.2% year-over-year reduction in sales volume (a loss of 869 transactions) and an 18.5% drop in median sales price; Santa Clara recorded a 46.2% reduction in sales volume (a loss of 947 transactions) and a 9.2% drop in median sales price; and Contra Costa recorded a 32.6% reduction in sales volume (a loss of 470 transactions) and a 26.9% drop in median sales price.
∙ Bay Area home sales remain at two-decade low [DataQuick]
∙ San Francisco Recorded Sales Activity In February: Up (14.9% YOY) [SocketSite]
∙ SocketSite's San Francisco Listed Housing Inventory Update: 4/14/08 [SocketSite]
Posted by socketadmin at 11:24 AM | Permalink | Comments (79) | (email story)
April 15, 2008
Foreclosure Filings Continue To Rise Across The Nation And California
According to RealtyTrac, foreclosure filings in the U.S. were up “nearly 57 percent” on a year-over-year basis in March. At the same time, bank repossessions were up “nearly 129 percent, but auction notices were up only 32 percent, indicating that more defaulting homeowners are simply walking away and deeding their properties back to the foreclosing lender.”
Foreclosure activity in California more than doubled over the past year (up 21% from February alone). And we led the nation in total number of filings (64,711 affected properties) for the 15th consecutive month. At one in every 204 households, the foreclosure filing rate in California is currently second only to Nevada (one in every 139).
∙ Foreclosure Activity Increases 5 Percent In March [RealtyTrac]
∙ JustQuotes: Fannie Raises A Red Flag With Regard To Foreclosures? [SocketSite]
Posted by socketadmin at 10:05 AM | Permalink | Comments (6) | (email story)
Islands Of Immunity Or Simply The Last To Catch The Contagion?
We don’t necessarily disagree with the overall sentiment: a growing number of recent Bay Area homebuyers are accumulating negative equity on their “investment.” But using Zillow for an accurate analysis? That’s a different matter altogether.
That being said, keep in mind that the Chronicle’s graphic represents the percentage of homes purchased in 2006 (versus the percentage of all homes) which are considered to be worth less today (once again, according to Zillow).
And the real question for San Francisco becomes, how - and how quickly - will those colors bleed? And of course, how long before they fade?
∙ Homeowners get that drowning feeling [SFGate]
Posted by socketadmin at 7:43 AM | Permalink | Comments (44) | (email story)
April 14, 2008
Another Admittedly Incomplete Update For A Few Featured Properties
While 1230 Sacramento, 73 Miguel, 545 Sanchez, and 1944-48 Buchanan all entered into (or firmed up) escrow over the past couple of days (last listed at $7,500,000, $2,875,000, $1,795,000 and $1,695,000 respectively), and 2311 Scott St #1 quickly closed escrow last week for $2,170,000 ($175,000 over asking), today the list price on 1150 Folsom #1 was reduced another $30,000.
At $795,000, 1150 Folsom #1 is now listed for $34,000 less than its sale price in October of 2005. Nope, no mix skewing that San Francisco Median Sales Price in this market.
∙ We’re Big Fans Of This Beaux-Arts Beauty (1230 Sacramento) [SocketSite]
∙ The Backside, View, And Rather Big "Right Pricing" Up On Miguel [SocketSite]
∙ Details, Details, Details On An 1880’s San Francisco Stick Victorian [SocketSite]
∙ A “Bitter” Renter Reports: Repossessed In Lower Pacific Heights [SocketSite]
∙ Through And Through And Throughout On A Sunny Saturday Morning [SocketSite]
∙ A Folsom Rausch Lofts Short Sale (Assuming 3.3% Appreciation) [SocketSite]
∙ An Admittedly Incomplete Update For A Few Featured Properties [SocketSite]
Posted by socketadmin at 5:44 PM | Permalink | Comments (22) | (email story)
SocketSite's San Francisco Listed Housing Inventory Update: 4/14/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 3% over the past two weeks and is currently running 37% higher on a year-over-year basis. Our listed inventory count does not include listings in any stage of contract (even those which are simply contingent) nor do they include multi-family listings (unless the units are individually listed).
With regard to any months of inventory calculations, keep in mind that while recorded sales activity in San Francisco was up almost 15% on a year-over-year basis in February according to DataQuick, this activity includes newly recorded closings in developments such as Infinity and One Rincon Hill (inventories for which are not included above and contracts for which were signed up to two years prior).
According to the San Francisco Association of Realtors, sales of listed single-family homes, condos, and TICs in San Francisco were down 16% on a year-over-year basis in February with condos/TICs off by 27% and single-family homes off by a relatively modest 6%. And according to a plugged-in reader, early results for March indicate listed sales volume in San Francisco was down over 30% on a year-over-year basis with months of inventory running at well over two-times the level of twelve months prior.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 3/31/08 [SocketSite]
∙ San Francisco Recorded Sales Activity In February: Up (14.9% YOY) [SocketSite]
Posted by socketadmin at 7:45 AM | Permalink | Comments (47) | (email story)
April 11, 2008
PMI’s Market Risk Index And Real Estate Trends Report: Spring 2008
According to the latest PMI Market Risk Index, The San Francisco-San Mateo-Redwood City MSAD ended the fourth quarter of 2007 with a 30.2% likelihood of house price declines over the next two years. And while that’s up from 24.6% in the third quarter of 2007, that’s also down from 39.5% at the beginning of 2005.
The likelihood of decline for a few other nearby areas: Sacramento-Arden-Arcade-Roseville (77.7%), Oakland-Fremont-Hayward (63.8%), San Jose-Sunnyvale-Santa Clara (51.1%).
And for perspective, the Miami-Miami Beach-Kendall MSAD weighs in with a 61% likelihood of decline (roughly twice that of San Francisco, but less than Oakland), while the New York-White Plains-Wayne MSAD weighs in at 7%.
UPDATE: As a number of plugged-in readers have noted, the PMI Market Risk Index is tied to the OFHEO house price index which “excludes jumbo loans and the large portion of subprime and Alt-A loans that Fannie Mae and Freddie Mac don’t participate in.”
· Economic And Real Estate Trends: Spring 2008 (pdf) [PMI]
· Economic And Real Estate Trends: Spring 2005 [SocketSite]
Posted by socketadmin at 8:09 AM | Permalink | Comments (27) | (email story)
April 10, 2008
It's A Good Thing San Francisco's Fortunes Aren't Tied To The Valley
"Housing prices in Silicon Valley remain defiantly high. New BMWs and Saabs cruise Highway 101. But for the first time there are signs that the current economic downturn is taking its toll on the country’s cradle of technology and innovation.
Job growth has slowed, start-up companies are hiring and spending more cautiously, and early-stage investors who nurture the start-ups with money and expertise are growing more frugal."
∙ Economy Has Become a Drag on Silicon Valley [New York Times]
∙ And What Happened Seven And One Half Years Ago In San Francisco? [SocketSite]
Posted by socketadmin at 11:13 AM | Permalink | Comments (41) | (email story)
April 8, 2008
JustQuotes: U.S. Pending Home Resale Index Hits Seven Year Low
“The number of Americans signing contracts to buy previously owned homes declined more than forecast in February, indicating no sign of a bottom in the U.S. real-estate recession that is entering its third year.
The National Association of Realtors' index of signed purchase agreements decreased 1.9 percent to 84.6, the lowest reading since records began in 2001, the group said today. The drop follows a revised 0.3 percent increase in January.”
“Pending resales dropped in three of four regions, led by a 9.8 percent decline in the West. Purchases fell 5.5 percent in the South and 3.7 percent in the Midwest. Pending sales increased 3.2 percent in the Northeast.”
∙ U.S. Economy: Pending Home Resales Fell More Than Forecast [Bloomberg]
Posted by socketadmin at 8:06 AM | Permalink | Comments (48) | (email story)
April 7, 2008
Forget About Foreshadowing, We Served Up the Forewarning
Two months ago we let you know to be prepared. Others are now learning the harder way.
[Brent Meyers] owns a substantial investment portfolio and a million-dollar house in Moraga. He pays his bills on time and has no credit card debt. His credit score, he says, is around 800, a rating more or less in the stratosphere. But in mid-March, Bank of America cut off his home equity credit line of a little more than $180,000, citing a decline in the value of his property.
∙ When Hell HELOCs Freeze Over... [SocketSite]
∙ Lenders retreat as housing market plummets [SFGate]
Posted by socketadmin at 8:30 AM | Permalink | Comments (18) | (email story)
April 4, 2008
Silicon Valley Hiring Slowdown: Meaningful Or Meaningless?
"Hiring in Silicon Valley was strong during much of 2007 but lost momentum toward the end of the year, a slight slowdown that has continued into 2008, local experts on technology employment say.
"Last year was great," said Patti Wilson, principal of CareerCompany.com, a Silicon Valley job consulting firm. "Companies were hiring and they were competing with each other for top technology talent."
This year though, hiring has dropped off and some companies are laying off workers, she noted.”
∙ Tech companies still hiring, but pace slowing [SFGate]
Posted by socketadmin at 8:13 AM | Permalink | Comments (11) | (email story)
March 31, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 3/31/08
The inventory of Active listed single-family homes, condos, and TICs in San Francisco increased slightly (1%) over the past two weeks and is currently running 43% higher on a year-over-year basis. And the percentage of Active listings that have been reduced at least once has increased from 21% to 29% (195 versus 384) on a year-over-year basis as well.
Keep in mind that our listed inventory counts do not include listings in any stage of contract (even those which are simply contingent) nor do they include multi-family listings (unless the units are individually listed). And once again, reports of decreasing inventories in San Francisco proper are either incorrect or possibly refer to a decrease from the levels of last October which would not reflect the market’s seasonality.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 3/17/08 [SocketSite]
Posted by socketadmin at 9:15 AM | Permalink | Comments (49) | (email story)
March 27, 2008
Are We Detached From More Than Simply The Fundamentals?
An interesting chart of California MSA home price appreciation as measured by the OFHEO*, put together by the Public Policy Institute of California (pdf), and by way of a plugged-in tipster. And an important observation which shouldn’t catch any plugged-in readers by surprise:
While California’s previous housing crisis (southern California in the early and mid‐1990s) was part of a broader economic slowdown, the relationship between housing and economic conditions today is less clear‐cut. In 2007, employment in Merced and Stockton grew more than 2%, despite crashing housing prices, whereas employment grew only 0.6% in California overall and even fell in Los Angeles, Orange County, Ventura County, and Riverside-San Bernardino – where home prices are holding up better than in the Central Valley.
*Note: For those who are unfamiliar, the OFHEO Home Price Index (HPI) is based on data from repeat single-family home sales, or refinancings, that involve conforming mortgages. Data from transactions involving either condominiums or non-conforming loans (two major components of the San Francisco market) are excluded from the Index.
∙ The California Economy: Crisis In The Housing Market (pdf) [ppic.org]
∙ OFHEO: U.S. House Prices Don't Fall (But Do In CA And The SF MSA) [SocketSite]
Posted by socketadmin at 9:38 AM | Permalink | Comments (60) | (email story)
March 26, 2008
Going Once, Going Twice...“Sold” For $700,000 (41 Federal #42)
With around sixty people in the room, but only a few active bidders, the high bid at today’s auction for 41 Federal #42 was $700,000 (and apparently it wasn’t “outbid”). As a plugged-in ex SF-er correctly surmised, however, the bank now has seven days to decide whether or not to accept the bid (which we’d be surprised if they didn’t).
A recorded sale at $700,000 would represent a drop of $180,000 (20.5%) from the original purchase price in December of 2006, and would also establish a new building “comp” at $760 per square foot.
That being said, keep in mind that the unit looked like it had never been occupied, and the reported sale price of $880,000 in 2006 was $5,000 over the original list price of $875,000 which had subsequently been reduced down to $825,000 prior to going into contract (i.e., something’s not quite right with respect to the original sale).
And tip of the hat to ex SF-er ("I think this sells for $700k+ or not at all"), Lance ("$685K"), and Nicole ("$679,000") who were all on record with their pre-auction predictions and within 3% of the highest bid (as well as to FSBO for filling in a few holes with respect to #42's official MLS history).
∙ Going Once, Going Twice (For Real?*) At Shore|Line: 41 Federal #42 [SocketSite]
Posted by socketadmin at 5:53 PM | Permalink | Comments (39) | (email story)
No Real Signs Of Recovery (Much Less Of Simply Stopping Its Slide)
While U.S. existing home sales were “up” in January (but once again, down 23.8% on a year-over-year basis and with prices down 8.2% nationally and 13.4% in the West), the pace of U.S. new-home sales continued its slide in February, down 1.8% to its lowest level since February 1995 and with a median sales price that's down 2.7% (year-over-year).
In short, the national housing market has yet to show any real signs of recovery much less of simply stopping its slide (see the light blue line).
∙ The Good And The Bad (But Not Necessarily The Ugly) [SocketSite]
∙ New-Home Sales in U.S. Fall to Lowest in 13 Years [Bloomberg]
∙ January S&P/Case-Shiller: San Francisco MSA Continues Decline [SocketSite]
Posted by socketadmin at 7:39 AM | Permalink | Comments (7) | (email story)
March 25, 2008
January S&P/Case-Shiller: San Francisco MSA Continues Decline
According to the January 2008 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 2.9% from December ’07 to January '08 and are down 13.2% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 11.4% (having fallen 2.3% from December).
Las Vegas and Miami share the dubious title of the weakest markets in January, reporting double-digit annual declines of 19.3%, followed by Phoenix at -18.2%. In January, Washington and Minneapolis slipped into negative double-digit territory with annual returns of -10.9% and -10.0%, respectively.
Prices fell across all three price tiers for the San Francisco MSA with the rate of decline easing slightly for both the lower and upper third of homes.
The bottom third (under $545,294 at the time of acquisition) fell 4.4% from December to January (down 28.8% YOY); the middle third fell 4.2% from December to January (down 15.9% YOY); and the top third (over $794,192 at the time of acquisition) fell 1.7% from December to January (down 3.5% YOY).
And according to the Index, home values for the bottom third of the market in the San Francisco MSA have returned to March 2004 levels, the middle third to August 2004 levels, and the top third to April 2005 levels.
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Record Declines in Home Prices Continued in 2008 [Standard&Poor's]
∙ December S&P/Case-Shiller: San Francisco MSA Hits Double-Digit Dip [SocketSite]
Posted by socketadmin at 7:00 AM | Permalink | Comments (222) | (email story)
March 24, 2008
The Good And The Bad (But Not Necessarily The Ugly)
The good news on Wall Street: JPMorgan has raised its bid for Bear Stearns to about $10 per share. The cumulative bad news on Wall Street: 34,000 jobs have been lost over the past nine months.
The good news from the National Association of Realtors: The pace of U.S. existing home sales unexpectedly rose 2.9% in February (but remains 23.8 percent off the pace of 2007). The bad news from the National Association of Realtors: The median existing-home price was 8.2% lower on a year-over-year basis (and 13.4% lower in the West).
And the mixed news (depending upon your perspective and portfolio) and reaction to both bits on The Street: Treasuries fell and yields are up (which should increase rates).
∙ JPMorgan Raises Bear Stearns Bid to Woo Shareholders [Bloomberg]
∙ Wall Street Firms Cut 34,000 Jobs, Most Since 2001 Dot-Com Bust [Bloomberg]
∙ Existing Home Sales Rise In February [NAR]
∙ Treasuries Fall as Stocks, Mortgage Purchase Ease Haven Appeal [Bloomberg]
Posted by socketadmin at 9:02 AM | Permalink | Comments (18) | (email story)
March 17, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 3/17/08
The inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 9% over the past two weeks and is now running 49% higher on a year-over-year basis. Reports of decreasing inventories in San Francisco are either incorrect or possibly refer to a decrease from the levels of last October which would not reflect the market’s seasonality.
Keep in mind that our listed inventory counts do not include listings in any stage of contract (even those which are simply contingent) nor do they include multi-family listings (unless the units are individually listed).
And combined with early reports that listed sales volume in San Francisco was off by ~20% on a year-over-year basis last month, months of listed inventory has now crossed over the four month mark (which is relatively high for San Francisco and close to 2x on a year-over-year basis).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 3/03/08 [SocketSite]
Posted by socketadmin at 3:15 AM | Permalink | Comments (51) | (email story)
March 14, 2008
San Francisco Recorded Sales Activity In February: Up (14.9% YOY)
According to DataQuick, home sales volume in San Francisco jumped 14.9% on a year-over-year basis last month (431 recorded sales in February ’08 versus 375 sales in February ‘07) and jumped 47.1% compared to the month prior (293 recorded sales in January ‘08). And while a general increase in reported sales activity in San Francisco shouldn’t catch any plugged-in readers by surprise (we noted the upward trend two weeks ago, and of course seasonality is in effect with respect to month-over-month gains), the magnitude of the increase is sure to raise an eyebrow or two (as it should).
Keep in mind, however, that DataQuick reports recorded sales which not only includes activity in new developments, but contracts that were signed (sold?) many months or even years prior and are just now closing escrow (or being recorded). The sales reports from the San Francisco Association of Realtors will likely paint a very different picture in terms of February market activity (down ~22% according to one plugged-in reader). And it does raise the question of whether or not new developments are "stealing" transactions from the existing condo market.
The median sales price in February was $736,000, down 2.8% compared to February ’07 ($757,500) and down 1.1% compared to the month prior. That being said, we continue to see mix playing a significant role in supporting the median sales price in San Francisco.
For the greater Bay Area, sales volume in February was down 36.7% on a year-over-year basis but increased 11.2% from the month prior (3,989 recorded sales in February '08 versus 6,305 in February ’07 and 3,586 this past January). The recorded median sales price fell 11.6% on a year-over-year basis and was down 0.4% compared to the month prior.
At the extreme, Alameda recorded a 44.5% year-over-year reduction in sales volume (a loss of 603 transactions) and a 16.8% drop in median sales price. And outside of San Francisco no Bay Area county reported a drop of less than 35% in sales volume, and not a single Bay Area county reported a positive change in Median Sales Price (with both Sonoma and Solano reporting drops of over 20%).
∙ Bay Area home sales remain at two-decade low [DataQuick]
∙ San Francisco Sales Activity In January: Down Again (-27.1% YOY) [SocketSite]
∙ SocketSite's San Francisco Listed Housing Inventory Update: 3/03/08 [SocketSite]
∙ Infinity And One Rincon Hill: Closings By The Numbers To Date (2/29) [SocketSite]
Posted by socketadmin at 2:30 PM | Permalink | Comments (68) | (email story)
March 13, 2008
JustQuotes: Mortgage Bankers Report On Mortgage Fraud (It’s Up)
“Rising real estate values over the past few years threatened to price new homebuyers out of the market and led some to attempt purchases before they were creditworthy. The higher valuations also led some individual real estate investors to speculate and stretch the truth on applications for multiple properties, especially in active markets, such as Florida and Nevada.
They were aided in this tactic by industry professionals who hoped that any future loan problems would be covered by a profitable sale of the collateral. Credit standards were loosened. More importantly for fraud, documentation requirements were also reduced.
There has been a long history of fraud and sour consequences associated with low/reduced/no documentation loans. As an example, loan servicing staffs are discovering a substantial percentage of prime and non-conforming delinquencies are for loans where the applicants stated their intent to occupy, but were in fact, rental properties at the outset.”
∙ Tenth Periodic Mortgage Fraud Case Report to the MBA (pdf) [mari-inc.com]
Posted by socketadmin at 3:10 PM | Permalink | Comments (4) | (email story)
Another Apple Speaks On The Edge Of Nob Hill (1635 California #33)
Four months ago we pointed it out as “another apples to apples comp in the making." And while 1635 California is on a busy street, and we’ll be the first to admit that the layouts aren’t exactly spectacular (which we actually noted two years ago), nothing about the location nor the building has recently changed.
That being said, the 36 condos at 1635 California Street first hit the market two years ago and based on tax records it appears as though unit #33 sold for right around $780,000. Twenty months later 1635 California #33 hit the resale market for $795,000 (a sale at which would have represented 1% annual market appreciation) but was subsequently reduced to $749,000. And just last week, the sale of condo #33 closed escrow with a reported contract price of $740,000.
A sale at $740,000 represents annual market depreciation of right around 3% over the past two years which might surprise some. But it's probably not going to surprise a plugged-in “PotreroResident” who four months ago commented, “Based on my analysis of this building, this unit is most likely worth about $740-750k, at best.” On the record and on the money (at least for today).
∙ Another Apples To Apples Comp In The Making (1635 California #33) [SocketSite]
∙ 1635 California Street [SocketSite]
Posted by socketadmin at 9:17 AM | Permalink | Comments (14) | (email story)
JustQuotes: It's A Good Thing We Don’t Have Any ARMs Around Here…
“U.S. home foreclosure filings jumped 60 percent and bank seizures more than doubled in February as rates on adjustable mortgages rose and property owners were unable to sell or refinance amid falling prices….About $460 billion of adjustable-rate mortgages are scheduled to reset this year and another $420 billion will rise in 2011, according to New York-based analysts at Citigroup Inc.”
∙ U.S. Home Defaults, Foreclosures Rise 60% in February [Bloomberg]
∙ An ARM (And Quite Possibly A Leg) [SocketSite 6/05]
Posted by socketadmin at 8:16 AM | Permalink | Comments (24) | (email story)
March 12, 2008
Is It Simply The New New Strategy, Or Is It Actually A(nother) Sign?
It’s a plugged-in reader that points out another apple ripening on the Noe Valley housing tree. Purchased for $965,000 on 8/4/06, 1024 Sanchez is back on the market today with a list price of $949,000.
Is listing below the last sale price simply the newest pricing strategy (“made you look!”), or is it actually another sign? And once again, it's time to go on record with your pre-closing predictions.
UPDATE: We’ll add that it had been listed for $949,000 in 2006 as well.
∙ Listing: 1024 Sanchez (2/2) - $949,000 [MLS]
∙ Another Single-Family Apple On The Noe Valley Tree: 480 Duncan [SocketSite]
Posted by socketadmin at 8:52 AM | Permalink | Comments (61) | (email story)
March 10, 2008
And What Happened Seven And One Half Years Ago In San Francisco?
As we’ve often pointed out, sales volumes and home price appreciation have been falling in San Francisco over the past couple of years despite the fact that that by most accounts our local economy remains strong, employment and wages are up, and the cost of borrowing remains near historic lows. And this has been in marked contrast to our last real estate decline (2001-2002) which directly coincided with a local economic meltdown (a.k.a. The Internet Bubble).
And now, both the national economy and Bay Area Business Confidence Index are faltering and Federal rate cuts are failing to spark sales (but are doing a great job of weakening the dollar). In fact, The Bay Area Business Confidence Index “tumbled to its lowest level in its 7 1/2-year history, based on results of a survey conducted in late January and early February.”
Let’s see, 7 1/2-years ago would be right around...
∙ Record low Bay Area business confidence [SFGate]
∙ U.S. Economy: Payrolls Unexpectedly Decline for Second Month [Bloomberg]
∙ Bay Area “Notices Of Default” Heading North? (So To Speak) [SocketSite]
∙ February S&P/Case-Shiller Index Decline Continues For SF MSA [SocketSite 4/07]
Posted by socketadmin at 9:55 AM | Permalink | Comments (14) | (email story)
March 6, 2008
JustQuotes: Might It Draw Demand From Way Over In San Francisco?
"The developer of the recently opened Eight Orchids condominium mid-rise in Oakland hopes to auction off nearly a third of the units, with some starting bids $300,000 below prior asking prices, as builders struggle to unload new properties in the current housing climate."
"The auction of 41 units is scheduled for March 30....The minimum bid for one-bedrooms is $245,000, down from as high as $520,888; two-bedrooms will start at $325,000, down from as high as $630,888; and three-bedrooms will begin at $475,000, discounted from as much as $805,888. There is no "secret reserve," meaning any unit that receives at least the minimum offer will go to the bidder."
∙ Prices cut for Oakland condo auction [SFGate]
∙ 8 Orchids (Oakland) [8-orchids.com]
Posted by socketadmin at 10:00 AM | Permalink | Comments (38) | (email story)
Where Are Kate Bush And Peter Gabriel When You Need Them?
Despite federal rate cuts, mortgage rates that remain well below historic averages and even HOPE, according to the Mortgage Bankers Association U.S. foreclosure rates are at an all-time high.
New foreclosures jumped to 0.83 percent of all home loans in the fourth quarter from 0.54 percent a year earlier. Late payments rose to a 23-year high, the organization said in a report today.
"We're seeing people give up even before they get to the reset because they couldn't afford the home in the first place," said Jay Brinkmann, vice president of research and economics for the Washington-based trade group.
And while the majority of new foreclosures (42%) are on adjustable-rate subprime mortgage products, “[a]nother 20 percent of new foreclosures were prime adjustable-rate mortgages, which accounted for 15 percent of all home loans, according to the report.”
Ah yes, those ARMS.
∙ U.S. Mortgage Foreclosures Rise as Owners 'Give Up' [Bloomberg]
∙ An ARM (And Quite Possibly A Leg) [SocketSite 6/05]
Posted by socketadmin at 8:41 AM | Permalink | Comments (5) | (email story)
March 5, 2008
JQ: While The Fed Giveth (Cuts), The Street Taketh Away (Spreads)
"The extra yield that investors demand to own so-called agency mortgage-backed securities over 10-year U.S. Treasuries rose to the highest since 1986, boosting the cost of loans for homebuyers considered the least likely to default.
The difference in yields on the Bloomberg index for Fannie Mae's current-coupon, 30-year fixed-rate mortgage bonds and 10- year government notes widened about 1 basis point, to 204 basis points, or 70 basis points higher than Jan. 15. The spread helps determine the interest rate homeowners pay on new prime mortgages of $417,000 or less. A basis point is 0.01 percentage point."
"Spreads tightened last week when the regulator for Fannie Mae and Freddie Mac, two of the largest buyers of the securities they guarantee, announced that temporary caps on their $1.5 trillion portfolio would be lifted. Investors have realized that the step was unimportant because the companies remain "capital-constrained," [a] New York-based UBS analysts wrote."
∙ Agency Mortgage-Backed Bond Spreads Reach Highest Since 1986 [Bloomberg]
∙ JustQuotes: What The OFHEO Are They Thinking? [SocketSite]
Posted by socketadmin at 9:04 AM | Permalink | Comments (8) | (email story)
March 3, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 3/03/08
While we’ve seen sales volume in San Francisco trending up over the past two months, new listings continue to outpace new contracts as inventory of Active listed single-family homes, condos, and TICs in San Francisco increased 5% over the past two weeks and is up 42% on a year-over-year basis.
Do keep in mind, however, that while sales volume is trending up, it’s still running almost 30% under the pace of 2007. And combined with increasing inventory, it has resulted in a near doubling of months of listed inventory versus the same time last year.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 2/19/08 [SocketSite]
∙ San Francisco Sales Activity In January: Down Again (-27.1% YOY) [SocketSite]
Posted by socketadmin at 3:00 AM | Permalink | Comments (24) | (email story)
February 26, 2008
December S&P/Case-Shiller: San Francisco MSA Hits Double-Digit Dip
According to the December 2007 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 3.2% from November '07 to December ’07 and are down 10.8% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 9.8% (having fallen 2.3% from November).
Miami remains the weakest market, reporting a double-digit annual decline of 17.5%, followed by Las Vegas and Phoenix at -15.3% each. In December, San Francisco slipped into negative double-digit territory with an annual return of -10.8%. Charlotte, Portland and Seattle are the only three MSAs still experiencing positive annual growth rates; however, Seattle came in at only +0.5%, an almost flat growth rate.
Prices fell across all three price tiers for the San Francisco MSA with the rate of decline increasing most significantly for the middle two-thirds of homes.
The bottom third (under $565,563 at the time of acquisition) fell 5.7% from November to December (down 25.3% YOY); the middle third fell 4.0% from November to December (down 12.1% YOY); and the top third (over $815,549 at the time of acquisition) fell 2.1% from November to December (down 2.1% YOY).
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Year End Numbers Mark Widespread Declines [Standard&Poor's]
∙ November S&P/Case-Shiller: San Francisco MSA Continues Decline [SocketSite]
Posted by socketadmin at 6:39 AM | Permalink | Comments (97) | (email story)
February 19, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 2/19/08
Despite some reports to the contrary, new listings continue to outpace new contracts in San Francisco as the inventory of Active listed single-family homes, condos, and TICs in San Francisco increased slightly (4.6%) over the past couple of weeks and is currently up 37% on a year-over-year basis.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 2/04/08 [SocketSite]
Posted by socketadmin at 3:15 AM | Permalink | Comments (32) | (email story)
February 14, 2008
San Francisco Sales Activity In January: Down Again (-27.1% YOY)
According to DataQuick, sales volume for existing homes in San Francisco fell 27.1% on a year-over-year basis last month (293 sales in January ’08 versus 402 sales in January ‘07) and fell 34.2% compared to the month prior (445 recorded sales in December ‘07). And as we've noted over the past three months, the data once again suggests that October’s uptick in reported sales activity was at least partially driven by a delay in September purchases/closings rather than a significant rebound in buyer activity.
The median sales price in January was $744,000, down 0.8% compared to January ’07 ($750,000) but up 1.8% compared to the month prior. That being said, we continue to believe that mix is playing a significant role in supporting the median in San Francisco.
For the greater Bay Area, sales volume in January was down 41.9% on a year-over-year basis and fell 29.2% from the month prior (3,586 recorded sales in January '08 versus 6,168 in January ’07 and 5,065 this past December). The recorded median sales price fell 8.5% on a year-over-year basis and was down 6.4% compared to the month prior.
Last month's sales were the lowest for any month in DataQuick's statistics, which go back to 1988. Sales have decreased on a year-over-year basis for 36 consecutive months. Prior to last month the slowest January was in 1995, when 4,326 homes sold. The strongest January, in 2005, posted 8,298 sales. The average for the month is 6,319 sales.
At the extremes, Napa recorded a 55.1% year-over-year reduction in sales volume and a 1.8% drop in median sales price, while Marin was the best performing Bay Area county with a 1.8% increase in Median Sales Price (but a 37.4% drop in sales volume). Both Contra Costa and Alameda Counties recorded significant drops in both sales volume (down 42.4% and 39.0% respectively) and median sales price (down 15.8% and 14.4% respectively).
∙ Bay Area home sales lowest for any month in two decades [DQNews]
∙ San Francisco Sales Activity In December: Down Again (-24.4% YOY) [SocketSite]
Posted by socketadmin at 11:10 AM | Permalink | Comments (108) | (email story)
February 7, 2008
Foreclosure Activity In San Francisco As Mapped By Trulia: 2/07/08
As a reader points out, over the past two months the number of San Francisco properties in some stage of foreclosure as mapped by Trulia has increased from 215 to 409.
And while the majority of mapped properties remain in District 10 (and at this point have only received notices of default), we will point out a noticeable shift of activity to the southwest (i.e., not Bayview).
∙ Current Foreclosure Activity In San Francisco As Mapped By Trulia [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (81) | (email story)
February 4, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 2/04/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased slightly (5.2%) over the past couple of weeks and is currently running just over 29% higher on a year-over-year basis (up 38% compared to 2006). And yes, our Q1 2008 Complete Inventory Index (Cii) will be published this afternoon tomorrow.
UPDATE: While listed inventory is up, according to a plugged-in reader preliminary sales totals for last month are currently down 35% on a year-over-year basis, down 46% as compared to January 2004, and could possibly represent a 14+ year low.
∙ SocketSite’s Complete Inventory Index (Cii) [SocketSite]
∙ SocketSite’s Complete Inventory Index (Cii): Q1 2008 (San Francisco) [SocketSite]
Posted by socketadmin at 6:45 AM | Permalink | Comments (16) | (email story)
February 1, 2008
JustQuotes: Crunch Goes The Construction Captial For Condominiums
"While a dozen amenity-packed deluxe condo projects have vied for attention over the past three years, financing for new construction has dried up in recent months. Instead of the 10 to 15 percent equity common in past few years, lenders now look for developers to put in 40 percent of construction costs, and few banks are willing to lend more than $50 million for new condo projects, according to Michael Joseph of Kearny Street Capital, a commercial mortgage broker who worked with Jackson Pacific on [One Hawthorne].
'A lot of banks are licking their wounds right now and they are not interested in more speculative development,' said Joseph."
∙ New S.F. condo project will be a rarity in 2008 [Business Times]
∙ One Hawthorne: The Design (And Some Details) Of What’s On The Way [SocketSite]
Posted by socketadmin at 3:15 AM | Permalink | Comments (4) | (email story)
January 30, 2008
Listed San Francisco Condo Sales Breakdown: December 2007
The December '07 breakdown for listed condominium sales in San Francisco has been published by the San Francisco Association of Realtors (and posted by the SFCAHomes Blog).
As reported, listed condo sales volume in San Francisco was down 32.8% on a year-over-year basis with the biggest losses in District 5 (down 14 sales or 37.8%), District 1 (down 11 sales or 64.7%) and District 10 (down 10 sales or 90.9%).
And if you’re a proponent of Median Sales Price as a measure of anything other than what people are buying (which we’re really not), it might be interesting to note that while District 5 was up 10.7% year-over-year on 23 sales, District 9 was down 16.4% on 39 sales and District 7 was down 4.7% on 16.
∙ December 2007 Condo Market Wrap (pdf) [SFCAHomes Blog]
Posted by socketadmin at 10:28 AM | Permalink | Comments (8) | (email story)
January 29, 2008
November S&P/Case-Shiller: San Francisco MSA Continues Decline
According to the November 2007 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 3.2% from October '07 to November ’07 and are down 8.6% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 8.4% (having fallen 2.2% from October).
Miami remains the weakest market, reporting a double-digit annual decline of 15.1%. San Diego followed with -13.4%, Las Vegas with -13.2% and Detroit with –13.0%. Seven of the metro areas are now posting double digit declines in their annual growth rates. Charlotte, Portland and Seattle are the only three MSAs still experiencing positive annual growth rates.
Prices fell across all three price tiers for the San Francisco MSA with the rate of decline leveling off for the lower two-thirds of homes but accelerating at the top.
The bottom third (under $586,277 at the time of acquisition) fell 5.3% from September to October (down 21.3% YOY); the middle third fell 2.5% from September to October (down 8.5% YOY); and the top third (over $834,425 at the time of acquisition) fell 3.1% from September to October (down 1.6% YOY).
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Record Declines in Home Prices Continue in November (pdf) [Standard&Poor's]
∙ October S&P/Case-Shiller: San Francisco MSA And Price Tiers Fall [SocketSite]
Posted by socketadmin at 7:14 AM | Permalink | Comments (70) | (email story)
January 28, 2008
Recap: What’s The Scoop On Foreign Investment In San Francisco?
Four months ago we asked the readers, “What’s The Scoop On Foreign Investment In San Francisco?” And perhaps Malin Giddings' quote in yesterday’s Chronicle summarizes our readers’ comments best:
"I know that there are a lot of sellers who want that to be true, and I know that the Europeans are definitely buying in New York," said Malin Giddings, who specializes in upscale San Francisco real estate for TRI Coldwell Banker. "But we see very few foreigners buying [here]."
∙ What’s The Scoop On Foreign Investment In San Francisco? [SocketSite]
∙ Foreigners get a piece of the real estate pie [SFGate]
Posted by socketadmin at 8:35 AM | Permalink | Comments (18) | (email story)
January 22, 2008
Bay Area Notices Of Default Head North. And South. And East.
While a 93.1% YOY increase in San Francisco “Notice of Default” (NOD) activity last quarter sounds quite dramatic, in absolute terms it still represents relatively few properties (334). But the number is growing. And as is happening statewide, we're seeing an increase in the percentage of notices that end up being bank owned.
Of the homeowners in default [throughout California], an estimated 41 percent emerge from the foreclosure process by bringing their payments current, refinancing, or selling the home and paying off what they owe. A year ago it was about 71 percent. The increased portion of homes lost to foreclosure reflects the slow real estate market, as well as the number of homes bought during the height of the market with multiple-loan financing, which makes 'work-outs' difficult.
Within the greater Bay Area, Contra Costa hit a record level of Q4 default activity (3,805 notices, up 151.8% year-over-year) as did Sacramento (5,807 notices, up 120.4% year-over-year). And neither Alameda (2,573 notices, up 119.4%) nor Santa Clara (2,162 notices, up 147.4%) were too far behind.
Most of the loans that went into default last quarter were originated between August 2005 and October 2006. The median age was 22 months, up from 15 a year earlier, indicating that the pool of at-risk home loans is getting larger.
And as we wrote nine months ago, "keep in mind that long-term interest rates remain near historic lows, and according to most, the Bay Area economy remains strong (and incomes are up)."
∙ California Foreclosure Activity Still Rising [DQNews]
∙ Bay Area “Notices Of Default” Heading North? (So To Speak) [SocketSite]
Posted by socketadmin at 12:39 PM | Permalink | Comments (6) | (email story)
January 21, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 1/21/08
Inventory of Active listed single-family homes, condos, and TICs in San Francisco increased just over 21% over the past couple of weeks, a normal December to January bump. Less than 15% of the inventory added over the past couple of weeks was in District 10. And listed inventory continues to run ~23% higher on a year-over-year basis (up ~36% compared to 2006).
Keep in mind, however, that we still haven’t seen the return of a significant number of listings that were withdrawn from the market at the end of last year, and we expect to see a near-term increase in listings for properties that are being sold to fund purchases in either Infinity or One Rincon Hill. And at 1,053 Active listings, we’re running about three months ahead of schedule compared to either 2006 or 2007.
Combined with the downward trend in sales volume, we estimate Months of Listed Inventory has increased about 50% on a year-over-year basis (from 2.1 to an estimated 3.3). And with regard to unlisted inventory, plug in next Monday (1/28) for our Q1 2008 Complete Inventory Index (Cii).
∙ What Happens When It’s Time To Fund? We’ll Have To Wait And See [SocketSite]
∙ Walkthroughs At Infinity: A Chance To Share Your Impressions [SocketSite]
∙ One Rincon Hill: Closings, Walkthroughs, And (Almost) Anything Else [SocketSite]
∙ SocketSite's San Francisco Listed Housing Inventory Update: 1/02/08 [SocketSite]
∙ San Francisco Sales Activity In December: Down Again (-24.4% YOY) [SocketSite]
∙ SocketSite’s Complete Inventory Index (Cii) [SocketSite]
Posted by socketadmin at 4:15 AM | Permalink | Comments (30) | (email story)
January 18, 2008
Bay Area Rents Surge, But Housing P/E Ratio Remains Out Of Line
There’s no doubt Bay Area average rents are up. And while we wouldn’t be surprised to see another 10-15% increase in 2008 (at least for San Francisco proper), keep in mind that the current housing Price-to-Earnings ratio is still well above its long-term average for the San Francisco MSA.
An analysis by Credit Suisse pegged the historical housing P/E ratio for the San Francisco MSA at 24x Earnings (or annual rent) versus a top 52 market average of 16.6x. So yes, we have long paid a premium (compared to most other areas) to buy versus rent in the Bay Area (or as many often comment, “it has always been expensive to buy here”).
That being said, the same Credit Suisse analysis pegged the housing P/E ratio for the San Francisco MSA at 42x in 2006. Assuming no change in property values and a 9.4% increase in rents during 2007, the current P/E ratio would be 38.4x. And a return to the historical 24x would either require rents to rise another 60%, property values to fall 37.5%, or a combination of the two.
∙ Bay Area rents surge 9.4% in last year [SFGate]
∙ San Francisco’s Housing P/E [SocketSite 5/05]
Posted by socketadmin at 11:29 AM | Permalink | Comments (92) | (email story)
A San Francisco Landlord Wants Your Thoughts (And To Cash Out)
From a plugged-in reader and landlord in San Francisco:
As a [landlord], I'm seeing rents zoom past dotcom levels and also [Gross Rent Multipliers] are at all time highs. When do you think this cycle will peak?
I have significant capital gains and want to sell my commercial property and buy multiple SFHs via 1031 exchange, and live in each for a couple of years to cash out $500K tax-free a piece. There has to [be] a point in time to pull the trigger where commercial property peaks and SFHs bottom. Some of you sound like astute investors, what do you think?
Bottom line is, I'm getting old and would rather be holding cash in this uncertain economy.
And speaking of getting older in the Bay Area, “[w]ith almost 18 percent of its population over 60, San Francisco is already the grayest major metropolis in the country. By 2020, it is expected that more than 21 percent of the population will be over 60 as Baby Boomers age and lifespans increase." Oh, and “30 percent of the subsidized affordable housing being built or in the pipeline in San Francisco is for seniors.”
∙ Bay Area Rents Surge, But Housing P/E Ratio Remains Out Of Line [SocketSite]
∙ S.F. faces silver tsunami [San Francisco Business Times]
Posted by socketadmin at 3:15 AM | Permalink | Comments (14) | (email story)
January 17, 2008
San Francisco Sales Activity In December: Down Again (-24.4% YOY)
According to DataQuick, sales volume for existing homes in San Francisco fell 24.4% on a year-over-year basis last month (445 sales in December ’07 versus a revised 589 sales in December ’06) and fell 7.1% compared to the month prior (479 recorded sales in November ‘07). And as we've noted over the past two months, the data once again suggests that October’s uptick in reported sales activity was at least partially driven by a delay in September closings rather than a significant rebound in buyer activity.
The median sales price in December was $731,000, down 1.9% compared to a revised December ’06 ($745,000) and down 10.3% compared to the month prior. That being said, we continue to believe that mix is playing a significant role in supporting the median.
For the greater Bay Area, sales volume in November was down 39.5% on a year-over-year basis and fell 1.2% from the month prior (5,065 recorded sales in December '07 versus a revised 8,372 in December ’06 and 5,127 this past November). The recorded median sales price fell 4.9% on a revised year-over-year basis and was down 6.6% compared to the month prior.
Last month was the slowest December is DataQuick's statistics, which go back to 1988. Sales have decreased on a year-over-year basis for 35 consecutive months. Until last month, the slowest December was in 1990, when 5,458 homes sold. The strongest December, in 2003, saw 12,349 sales. The average for the month is 8,903.
At the extremes, Sonoma recorded a 48.5% year-over-year reduction in sales volume and a 21.9% drop in median sales price, while Napa was the best performing Bay Area county with no change (0.0%) in it's Median Sales Price (but a 43.3% drop in sales volume).
∙ Bay Area home sales drag along bottom, median price back to 2005 [DataQuick]
∙ San Francisco Sales Activity In November: Back Down (-15.7% YOY) [SocketSite]
Posted by socketadmin at 11:28 AM | Permalink | Comments (76) | (email story)
January 16, 2008
Listed Single-Family Home Sales Volume Down 27.9% In December
According to the San Francisco Association of Realtors (and via the SFCAHomes Blog), sales volume for listed single-family homes in San Francisco was down 27.9% on a year-over-year basis in December.
The largest declines in sales (not "prices") occurred in districts 9 (down 62.5%), 5 (down 50%), and 4 (down 27.8%). The much maligned district 10 was down 11.9%. And only district 7 recorded an increase in sales activity: up 100% (from 3 to 6 sales).
And before anybody starts touting increases in median sales price as proof of appreciation, do keep in mind that the “median selling price” in district 7 increased from $1,850,000 in December of 2006 to $4,005,000 in December of 2007 (an increase of 116%). Nope, there's definitely no "mix" in these numbers.
∙ Single Family Homes Market Wrap December 2007 San Francisco [SFCAHomes Blog]
Posted by socketadmin at 9:13 AM | Permalink | Comments (53) | (email story)
January 2, 2008
SocketSite's San Francisco Listed Housing Inventory Update: 1/02/08
The year (2007) ended with an inventory of Active listed single-family homes, condos, and TICs in San Francisco that was 23.9% higher on a year-over-year basis. And more specifically (and possibly telling), 59.9% higher for single-family homes (driven primarily by slowing sales in Districts 2, 4, and 10) versus 1.4% higher for condos and TICs.
The percentage of active listings that were reduced at the time of year’s end was also up on a year-over-year basis (from 26% to 31%), with the absolute number of reduced single-family home listings up 104% (from 73 to 149 listings). Once again, driven primarily, but not exclusively, by District 10 (which includes Bayview, Crocker Amazon, Excelsior, Outer Mission and Visitacion Valley).
∙ Listed San Francisco Home Sales Volume Down/Down In November [SocketSite]
Posted by socketadmin at 12:19 PM | Permalink | Comments (20) | (email story)
JustQuotes: The Fast Changing Façade (and Faces) Of San Francisco
"San Francisco is changing so rapidly some say the San Franciscans of 2007 won't recognize the place in five years.
It's part of a trend that began after the city picked itself up after the dot-com bust of a few years ago. There are plans for more condos, bigger high-rises, so many fine restaurants that more San Franciscans will recognize the name of a celebrity chef than the quarterback of the 49ers.
"Some people say change is bad," said Meagan Levitan, a real estate broker who is also on the Recreation and Park Commission. "I want my old city, but at the same time, change is exciting."
But change is also sobering - some experts worry that a new San Francisco of high-rises and fine living will be a city of the very rich and very poor, a boutique city and not a real one."
∙ High-rises are a sign of the times in changing San Francisco [SFGate]
Posted by socketadmin at 8:49 AM | Permalink | Comments (59) | (email story)
Cashing Out: If It Can Happen There, Can It Happen Anywhere?
If hardened New Yorkers have started leaving The City for financial reasons, perhaps it’s not so crazy to think that a growing number of San Franciscans might consider doing the same.
People are discovering that with Manhattan’s high apartment prices, they can cash out and get much more for their money outside the city, where the inventory is growing and the prices are falling. Some buyers, not quite ready for picket-fence lives, are even finding pockets of urbanism that didn’t exist outside the city a few years ago.
And it begs the question, how will falling prices outside of San Francisco proper (or even in the outer districts) impact the demand curve (and prices) throughout the rest of the city?
∙ Cashing Out of New York City [New York Times]
Posted by socketadmin at 5:00 AM | Permalink | Comments (61) | (email story)
December 26, 2007
October S&P/Case-Shiller: San Francisco MSA And Price Tiers Fall
According to the October 2007 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA fell 2.1% from September '07 to October '07 and are down 6.2% year-over-year. For the broader 10-City composite (CSXR), year-over-year price growth is down 6.7% (having fallen 1.4% from September).
Miami surpassed Tampa in October, reporting a double-digit annual decline of 12.4%. Tampa followed with -11.8%, Detroit with -11.2% and San Diego with -11.1%. Six of the metro areas are now posting double digit declines in their annual growth rates. Atlanta and Dallas finally entered negative territory, with declines of 0.7% and 0.1%, respectively, leaving only Charlotte, Portland and Seattle as the MSAs still experiencing positive annual growth rates.
Prices fell across all three price tiers for the San Francisco MSA.
The bottom third (under $604,785 at the time of acquisition) fell 5.3% from September to October (down 17.0% YOY); the middle third fell 2.2% from September to October (down 7.2% YOY); and the top third (over $853,245 at the time of acquisition) fell 1.2% from September to October (up 0.8% YOY).
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the "San Francisco" index (i.e., the greater MSA).
∙ Broadbased, Record Declines in Home Prices in October [Standard&Poor's]
∙ September S&P/Case-Shiller: San Francisco MSA And Price Tiers Fall [SocketSite]
Posted by socketadmin at 9:39 AM | Permalink | Comments (14) | (email story)
December 20, 2007
San Francisco Sales Activity In November: Back Down (-15.7% YOY)
According to DataQuick, sales volume (i.e., demand last month) for existing homes in San Francisco fell 15.7% on a year-over-year basis last month (479 sales in November ’07 versus a revised 568 sales in November ’06) and fell 8.9% compared to the month prior (526 recorded sales in October ‘07). As we noted last month, it appears as though October’s uptick in reported sales activity was at least partially driven by a delay in September closings rather than a much ballyhooed rebound in buyer activity.
At the same time, the median sales price in November was $814,750, up 7.2% compared to a revised November ’06 ($760,000) and up 2.5% compared to the month prior. And yes, for some strange reason we’re still thinking mix.
For the greater Bay Area, sales volume in November was down 36.2% on a year-over-year basis and fell 6.5% from the month prior (5,127 recorded sales in November '07 versus a revised 8,042 in November ’06 and 5,486 this past October). The recorded median sales price fell a nominal 0.3% as compared to the month prior but was up 1.5% on a revised year-over-year basis.
At the extreme, Solano County recorded a 50.2% year-over-year reduction in sales volume (and a drop of 14.8% in median sales price) while Contra Costa County recorded a 46.0% year-over-year drop in sales and a 6.9% drop in median sales price despite a reported 1.3% growth in population from July 2006 to July 2007.
∙ Bay Area home sales stuck at two-decade low; price picture mixed [DQNews]
∙ San Francisco’s Sales Volume Up And Down In October [SocketSite]
∙ Listed San Francisco Home Sales Volume Down/Down In November [SocketSite]
∙ JustQuotes: CA DOF Estimates Population Growth In San Francisco [SocketSite]
Posted by socketadmin at 12:04 PM | Permalink | Comments (77) | (email story)
JustQuotes: CA DOF Estimates Population Growth In San Francisco
“The Bay Area's population growth rate outpaced the state last year as the nine-county region, led by San Francisco and Santa Clara County, added nearly 90,000 new residents, according to the Department of Finance's latest data released Wednesday.
Santa Clara County saw the area's biggest gain, attracting 29,904 new residents for a 1.67 percent increase from the previous year for a population of 1.8 million as of July 1. San Francisco was second, growing by 1.4 percent to 11,327 and bringing its population to 817,537. Contra Costa County was third with 13,189 new residents, or a growth rate of 1.28 percent. It now has 1.04 million residents.”
∙ Santa Clara County, S.F. lead Bay Area in population growth [SFGate]
∙ California County Population Estimates and Components of Change 2000-2007 [CA DOF]
Posted by socketadmin at 11:03 AM | Permalink | Comments (13) | (email story)
Their Mascot Might Be A Bull, But Merrill Lynch Is Anything But
The title of yesterday’s Economic Commentary from Merrill Lynch: “Housing deflation could be a multi-year process.” And the executive summary:
Both the near-term and longer-run outlooks for the housing market remain clouded in what is a severe downturn in starts, sales and prices that has become national in scope. As we saw in the November housing starts data, the builders are now frantically cutting production.
But with the sales backdrop still softening, they may have to slice their construction plans by another 30% before we hit bottom on a cyclical basis. And, that bottom could be as long as a year away. Beyond that, weak demographic fundamentals point to years of sluggish real estate activity, particularly in terms of the “price”. The looming dominance of the “move down” buyer suggests that home values will continue to soften long after the building industry mops up the current excess supply. In fact, real estate pricing in general can be expected to be in the doldrums through 2012.
The need to save for retirement will have to increasingly come “organically” in the form of setting aside an extra nickel or dime from every dollar earned in after-tax wages and salaries as opposed to what we as a society have been doing for the better part of the past decade, in essence, blurring the distinction between real estate as a “consumption good” (place to live) and real estate as part of the “portfolio” (investment) that was going to experience sustained double-digit appreciation and emerge as a fountain of cash-flow in the future.
Expectations are already in the process of being deflated and we are at the early stages of a savings revival in the traditional sense of the word, and this will (i) be deflationary for the aggregate demand curve; (ii) be bullish for Treasury bonds; (iii) act as an underpinning for the dollar insofar as this process continues to foster an improvement in the current account deficit (which, excluding energy, is down to a six-year low).
See the chart [above] – at the height of the bubble, almost one in four households who were contemplating a move into real estate based their decisions on future price appreciation. This “investor class” that dominated the housing market for so long has now seen its share dwindle to a record low of 4%. This is a very big deal as it illustrates just how far the speculation has been expunged, and it also heralds a major (and healthy) shift in how the public now perceives real estate.
And while the report is national by nature, there are obviously themes that might resonate right here at home. And of course, there’s the punch line:
Here is what we really “do not get”. There are still economists out there talking about how the housing recession is still local and not regionally broad based. We have no idea who their data vendors are. In our view, this clearly goes down as the most national real estate downturn since the 1930s.
Posted by socketadmin at 2:00 AM | Permalink | Comments (13) | (email story)
JustQuotes: Perhaps Not The Other Shoe (But At Least A Lace)
“Bank of America CEO Ken Lewis told editors of the Wall Street Journal that he's worried about borrowers with strong credit scores not making loan payments if the housing crisis worsens.
Such concerns by the head of California's largest bank could trigger a tightening of credit availability beyond the subprime customer base.
"There's been a change in social attitudes toward default," Lewis told the Wall Street Journal. "We're seeing people who are current on their credit cards but are defaulting on their mortgages. I'm astonished that people would walk away from their homes."
Apparently even borrowers with strong credit scores are finding it easier to walk away from their mortgages, especially if they put little or no money down on houses and condos purchased for investment purposes.”
∙ BofA CEO worries about creditworthy borrowers defaulting [Business Times]
Posted by socketadmin at 1:50 AM | Permalink | Comments (48) | (email story)
December 19, 2007
RealtyTrac Reports: November 2007 Foreclosure Activity In California
“A total of 39,992 foreclosure filings were reported in California in November, the most of any state despite a 21 percent decrease from the previous month. The state’s November foreclosure activity was still up nearly 108 percent from November 2006, and the state’s foreclosure rate of one foreclosure filing for every 325 households was 1.9 times the national average and fifth highest among the states.”
“California cities accounted for five of the nation’s top 10 metro foreclosure rates in November, one fewer than in the previous month. Stockton, Calif., took the top spot, with one foreclosure filing for every 99 households — more than six times the national average. Modesto, Calif., took the No. 2 spot, with one foreclosure filing for every 104 households, and Merced, Calif., took the No. 3 spot, with one foreclosure filing for every 106 households. Other California cities in the top 10 were Vallejo-Fairfield at No. 6 and Riverside-San Bernardino at No. 9.”
∙ Foreclosure Activity Decreases 10 Percent In November [RealtyTrac]
Posted by socketadmin at 8:48 AM | Permalink | Comments (24) | (email story)
JustQuotes: Forget About The Floor Plan, Who’s In The Kitchen Below?
"Tony high-rises have always lured potential residents with views, pools and prestigious ZIP codes. But now, well-to-do Baby Boomers and young, upwardly mobile professionals want the amenities of high-end hotels. So developers are putting on the Ritz. And because San Francisco spends more money on dining out than any other metropolis on record, haute cuisine is becoming part of the package."
UPDATE: "Rumor has it that The Palms are close to closing a deal with a restauranteur, replacing their existing sales office."
UPDATE Redux: "Regarding the Palms update -- at the building holiday party one of the sales people (who lives in the bldg) said a Japanese (sushi?) restaurant has signed on to move in where the sales office is. Apparently, a restaurant with other locations in SF. The sales team is vacating by the end of Dec. She also said there are four units left here."
∙ As upscale home complexes add great chefs, more buyers are biting [SFGate]
Posted by socketadmin at 3:00 AM | Permalink | Comments (17) | (email story)
December 12, 2007
Listed San Francisco Home Sales Volume Down/Down In November
According to the San Francisco Association of Realtors (via SFCAHomes Blog), November sales volume for listed single family homes in San Francisco fell 24.9% on a year-over-year basis (175 transactions in 2007 versus 233 transactions in 2006) and dropped 11.6% compared to the month prior (198 transactions in October 2007).
Drops in districts two, four and ten accounted for almost all of the lost volume while district one showed the only (relatively) significant increase (from 13 sales in 11/06 to 22 sales in 11/07). And as was the case last month, expect the DataQuick counts for November to follow suit (in terms of direction).
∙ San Francisco's November Single Family Home Sales Market Wrap [SFCAHomes Blog]
∙ Listed San Francisco Home Sales Volume Up And Down In October [SocketSite]
Posted by socketadmin at 11:52 AM | Permalink | Comments (23) | (email story)
December 11, 2007
Current Foreclosure Activity In San Francisco As Mapped By Trulia
A plugged-in reader notes that Trulia has started mapping foreclosure activity in San Francisco as reported by RealtyTrac (which not only includes bank-owned properties but notices of default and scheduled sales as well). And while we are suckers for a good map (or graphic), we will note that the depth of Trulia’s property specific information suffers from the same weaknesses as the Yahoo Foreclosure Center.
That being said, Trulia currently maps 215 properties in San Francisco in some stage of foreclosure (mostly notices of default). The majority are concentrated in District 10 (which shouldn't catch anybody by surprise). And we will be tracking how that number (and concentration) changes over time.
[Full Disclosure: Trulia currently advertises in the SocketSite Marketplace (but played no part in prompting this post).]
∙ Bay Area “Notices Of Default” Heading North? (So To Speak) [SocketSite]
∙ Yahoo Unveils Underwhelming Foreclosure Center [SocketSite]
Posted by socketadmin at 9:35 AM | Permalink | Comments (23) | (email story)
December 10, 2007
NAR Adds 0.18% And Aims To End The Year On A Positive Note
For the first time in nine months, the National Association of Realtors has revised their forecasts for national existing home sales in 2007 and 2008 upwards.
In both cases, however, NAR's revised forecasts have added 10,000 home sales to last month's estimates of 5.66 and 5.69 million (2007 and 2008 respectively). And in both cases it represents an increase of 0.18% over last month's forecasts (which seems to be more spin than substance) and a drop of 12.5% as compared to 2006 (which would represent the lowest level of market activity since 2002).
The trade group also said its index that forecasts near-term home sales inched upward in October. The trade group's seasonally adjusted index of pending sales for existing homes rose 0.6 percent to 87.2 from an upwardly revised September index of 86.7, but was down 18.4 percent from a year ago — the third-largest year-over year decline on record.
The Realtors group also said the median price for U.S. existing homes — the point at which half sold for more and half for less — will sink by 1.9 percent to $217,600 this year and rise 0.3 percent next year to $218,300.
∙ Realtors' Forecast Bucks Common Wisdom [Associate Press]
Posted by socketadmin at 9:17 AM | Permalink | Comments (8) | (email story)
Two Noe Valley Renovations A Block (And A Half Million Dollars) Apart
It's another reader’s comment (with which we very much agree):
I have been an architect and developer myself for over 25 years and it has been interesting, to say the least, to see so many people jump into the business of building homes. I think they became confused between the profits earned from a rapid escalation run-up brought on by cheap easy financing, and times past when good quality product in good locations sold because of real established value and experience. It will be nice when this market shakes out all of the "developers" and "designers".
And yes, we'll let you make the call (right here and now).
∙ Listing: 549 28th Street (4/4) - $2,100,000 [Virtual Tour] [MLS]
∙ Listing: 455 27th Street (4/3.5) - $2,595,000 [Virtual Tour] [MLS]
∙ Could “Priced Right” In Ashbury Heights Be Less Than What Was Paid? [SocketSite]
Posted by socketadmin at 3:00 AM | Permalink | Comments (24) | (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, there seems to be such a strong demarcation between the renting "bears" and the homeowning "bulls" in the comments' section of the blog. But before we were homeowners, we were well aware that the SF market might be headed for trouble, and gaining a mortgage and a property tax bill did not suddenly make us grow blinders as well!
We bought a house this year...not because we were trying to 'time the market,' and not because we believed our house's appreciation would beat out our stock market investments, but because it was the right time for *us* (recent job promotion, new baby on the way...all the reasons that normal pre-bubble citizens used to buy houses). We didn't buy our house as an investment...and if the market declines by 10-20% (and I think this is a possibility)...well, we bought for the long-term and intend to stay here at least 5, if not 15, years. Yes, we may lose money...but cheerleading real estate from the top of our nearest real estate blog will not change that, and declaring that our house is appreciating 10% this year will not make it so.
So I do believe that one can be a homeowner AND a rational observer as well, and I bet there are many like-minded readers of [SocketSite].
In betting terms, that’s what we'd call a sure thing. Thank you for reminding us that the average SocketSite reader is anything but (average). And as always, thank you for plugging in.
∙ The Average SocketSite Reader (Is Anything But) [SocketSite]
Posted by socketadmin at 12:00 PM | Permalink | Comments (102) | (email story)
December 3, 2007
An Apples To Apples Sale In The Marina (1751 Beach): The Market
1751 Beach Street (a renovated three-bedroom, two-bath Marina condo) closed escrow this past Friday with a contract price of $1,420,000. A sale of this same condo in July of 2002 for $1,100,000 would suggest average annual market appreciation of 4.9% over the past five and one-half years.
Then again, 1751 Beach Street also changed hands a little over two years ago (September 2005) for $1,400,000. And with this data point in hand, average annual market appreciation for this property is more accurately represented as 7.8% from July 2002 to September 2005 and 0.7% from September 2005 to November 2007.
[Editor’s Note: Up next, a look at this property from the perspective of an investment over the past two years (so let’s try to keep the comments on this post related to the market).]
∙ A Case Of Premature Reduction At 1751 Beach In The Marina? [SocketSite]
∙ An Apples To Apples Sale In The Marina (1751 Beach): The Investment [SocketSite]
Posted by socketadmin at 9:57 AM | Permalink | Comments (8) | (email story)
SocketSite's San Francisco Listed Housing Inventory Update: 12/03
Once again, the inventory of Active listed single-family homes, condos, and TICs in San Francisco fell over the past two weeks (12.0%) as is typical of a normal winter market slowdown. And listed inventory levels remain up (6.6%) on a year-over-year basis as does the number of active listings that have undergone at least one price reduction (up 18.3%).
And yes, a year-end edition of our Complete Inventory Index (Cii) is close on the horizon.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 11/19 [SocketSite]
∙ SocketSite’s Complete Inventory Index (CII): Q3 2007 (SF) [SocketSite]
Posted by socketadmin at 3:00 AM | Permalink | Comments (25) | (email story)
November 27, 2007
September S&P/Case-Shiller: San Francisco MSA And Price Tiers Fall
According to the September 2007 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA slipped 4.6% year-over-year and fell 0.8% from August '07 to September ‘07. For the broader 10-City composite (CSXR), year-over-year price growth is down 5.5% (down 0.9% from August).
While Tampa remains the metro area with the largest annual decline, at -11.1%, Miami surpassed Detroit in September, reporting a decline of 10% over the past 12 months. Detroit and San Diego followed with -9.6% each.
Prices also fell across all three price tiers for the San Francisco MSA.
The bottom third (under $614,308 at the time of acquisition) fell 2.4% from August to September (down 13.2% YOY); the middle third fell 0.9% from August to September (down 5.6% YOY); and the top third (over $860,000 at the time of acquisition) fell 0.3% from August to September (up 1.4% YOY).
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the “San Francisco” index (i.e., the greater MSA).
UPDATE: And by request (or at least an appropriate amount of taunting), the San Francisco Home Price Index (HPI) tiers plotted logarithmically:
∙ U.S. National Home Price Index Posts a Record Annual Decline (pdf) [S&P]
∙ August S&P/Case-Shiller HPI: San Francisco MSA Falls (But Less) [SocketSite]
∙ S&P/Case-Shiller Home Price Index For San Francisco By Price Tier [SocketSite]
Posted by socketadmin at 7:38 AM | Permalink | Comments (62) | (email story)
November 26, 2007
JustQuotes: Looking At SF Through Blue/Green Colored Glass(es)
"To be sure, glass-clad buildings are nothing new in San Francisco. The Hallidie Building, built at 130 Sutter St. in 1917, wears one of the world's first glass "curtain walls," in which pre-assembled panels are hung into place on a building's structural form.
But as glass-and-steel high-rises recast the skyline after World War II, overtly modern buildings sparked a backlash. The shift culminated in 1985's Downtown Plan, which decreed that new buildings should "contribute to the visual unity of the city." Another rule: "Highly reflective materials, particularly mirrored or highly reflective glass, should not be used."
The planning director at the time: Dean Macris. The planning director today: Macris, who returned to the post in 2004.
While Macris now champions contemporary design, he and Nikitas say the 1985 edict against glossy glass still applies. But the sheer number of sheer towers is causing alarm, as is the fact that the first batch hasn't lived up to planner expectations: "I can't say we've said, 'Aha, there's the perfect solution,' " Macris acknowledged."
∙ Newest towers will give S.F. skyline a touch of glass [SFGate]
∙ Testing tries to ensure that glass structures don't court disaster [SFGate]
Posted by socketadmin at 9:20 AM | Permalink | Comments (8) | (email story)
November 21, 2007
When Good Comps Go Bad (Down In The Marina)
Based on the assumption of an appreciating market, and past sales (e.g., comps) in the exact same Marina building, the original list price of $1,229,000 for 1307 Bay Street #3 probably seemed quite reasonable at the time. But it didn’t sell for that.
Nor did it sell for the reduced price of $1,195,000. Or $1,179,000. Or $1,139,000. Or even $1,069,000. It did close escrow two weeks ago, however, for $1,030,000 (16.2% under that original asking).
And yes, that’s $80,000 (7.2%) less that what #1 sold for in April of 2005. That’s $112,000 (9.8%) less that what #2 sold for in April of 2006. And that’s $140,000 (12%) less than what #4 (which is directly below #3) sold for last November (2006).
And while Bay is indeed a busy street, it was last year (and the year before that) as well. So if the Marina location hasn’t changed, what the heck has?
∙ Damn Those Direct Comps In The Marina (1307 Bay Street) [SocketSite]
∙ RealRecentReductions: You’ve Seen These Before (Will You Again?) [SocketSite]
Posted by socketadmin at 9:45 AM | Permalink | Comments (132) | (email story)
JustQuotes: What’s The Cause And What’s The Effect?
“Countrywide, GMAC, Litton and HomeEq - which collectively service more than one quarter of subprime loans to people with poor credit - agreed to maintain the initial, lower interest rate for some subprime borrowers whose rates are scheduled to jump significantly higher. To qualify, borrowers must occupy their homes, have made their payments on time and prove they cannot afford payments with the higher interest rate.”
"Property values are falling dramatically, primarily because there are so many foreclosures already on the market in some areas," [Larry Litton Jr., chief executive of Houston's Litton Loan Servicing] said. "Clearly, it is not good for our investors to have the real estate back. It feels like a no-brainer for a loan servicer to keep the payment where it is, keep another piece of real estate off the market and keep the borrower in the house."
∙ Governor, 4 big lenders agree on plan to stall high mortgage rates [SFGate]
Posted by socketadmin at 8:02 AM | Permalink | Comments (18) | (email story)
November 19, 2007
SocketSite's San Francisco Listed Housing Inventory Update: 11/19
While the normal winter market slowdown is upon us, and inventory of Active listed single-family homes, condos, and TIC listings in San Francisco fell 8.0% over the past few weeks, listed inventory levels are up 8.7% on a year-over-year basis.
Also worth noting, the number of active listings that have undergone at least one price reduction (440) is up 18.9% as compared to the same time last year.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 10/29 [SocketSite]
Posted by socketadmin at 7:16 AM | Permalink | Comments (13) | (email story)
November 15, 2007
San Francisco’s Sales Volume Up And Down In October
According to DataQuick, sales volume (i.e., demand last month) for existing homes in San Francisco fell 8.2% on a year-over-year basis last month (526 sales in October ’07 versus a revised 573 sales in October ’06) but rose 12.2% compared to the month prior (469 recorded sales in September ‘07). At the same time, the median sales price in October was $795,000, up 3.9% compared to a revised October ’06 ($765,000) and up 2.8% compared to the month prior. (And yes, we’re still thinking mix.)
And as we noted yesterday, the question remains, did the mortgage meltdown in August simply delay purchases/closings (which would have pushed September volume into October), or is sales activity in San Francisco actually picking up?
While there is always a seasonal decline in sales from summer to fall, home purchases that were financed with mortgages for more than $417,000, so-called "jumbos", have dropped in half. Homes purchased with conforming loans have increased 12 percent.
For the greater Bay Area, sales volume in October was down 35.7% on a year-over-year basis (again, not a typo) but rose 9.4% from the month prior (5,486 recorded sales in October '07 versus a revised 8,532 in October ’06 and 5,014 this past September). The recorded median sales price rose a nominal 1.0% as compared to the month prior, and was up 2.4% on a revised year-over-year basis.
Outside of San Francisco county, the smallest drop in year-over-year sales volume was recorded in Marin (down 28.7%) and the largest in Napa (down 53.9%).
∙ Bay Area home sales drag along bottom [DQNews]
∙ San Francisco's Sales Volume Falls, Broader Bay Area Plummets [SocketSite]
∙ Listed San Francisco Home Sales Volume Up And Down In October [SocketSite]
Posted by socketadmin at 11:14 AM | Permalink | Comments (57) | (email story)
November 14, 2007
Listed San Francisco Home Sales Volume Up And Down In October
DataQuick will likely release their numbers later this week, but according to the San Francisco Association of Realtors, and via the SFCondoMap Blog, October sales volume for listed single family homes in San Francisco was down 20.5% on a year-over-year basis (198 transactions in 2007 versus 249 transactions in 2006).
At the same time, the sales volume for single family homes in San Francisco was up 27.7% as compared to the month prior (155 transactions in September 2007). And the question remains, did the mortgage meltdown in August simply delay purchases/closings (which would have pushed September volume into October), or is sales activity in San Francisco actually picking up? And of course, what's going on with condominiums?
Editor's Note: We're still on the hunt for the October sales volume for San Francisco condominiums and prematurely published the total sales volume this morning. Appologies for any confusion (and please let us know if you have the official condo stats).
∙ Single Family Homes Sales By District: October '06 vs. October '07 (pdf) [realtownblogs]
Posted by socketadmin at 9:38 AM | Permalink | Comments (23) | (email story)
JustQuotes: The Foreclosure Spillover, Symptom Or Subterfuge?
"The losses (from foreclosures) are extending to neighbors and to entire communities," said Martin Eakes, chief executive of the Durham, N.C., Center for Responsible Lending, which released the survey on Tuesday. "The spillover effect is disturbing because we've only just begun to see the foreclosures."
"Foreclosures aren't causing prices to fall - it's a symptom of the whole thing unraveling," [Christopher ] Thornberg said. "If you had no foreclosures at all, prices were still going to fall. (Foreclosures) may accelerate the process, but it's a process that has to happen one way or another because when you look at (home) prices relative to income, it's completely insane."
∙ Ripple effect of foreclosures touch entire communities [SFGate]
Posted by socketadmin at 8:30 AM | Permalink | Comments (24) | (email story)
November 12, 2007
S&P/Case-Shiller Home Price Index For San Francisco By Price Tier
While it’s still not the county level detail we’d all love to get our analytic little hand on, Standard & Poor’s has started publishing its S&P/Case-Shiller Home Price Indices by price tiers.
Each tier represents approximately one-third of the number of sales transactions recorded in each respective market. For example, for each market, Standard & Poor’s defines low, medium and high by defining breakpoints in one- third intervals for all sales found at each point in time. The methodology looks at the first sale in a given sale pair to define the price level.
Two things that caught our attention: the divergence in the performance of properties between price tiers in general (which shouldn't catch anybody that's plugged-in by surprise); and the time at which the divergence occurred in specific (easy money anyone?).
And while tempting, we wouldn't go so far as to assume the top third is a better proxy for San Francisco as a whole.
UPDATE: And we somehow managed to forget our standard S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the “San Francisco” index (i.e., the greater MSA).
∙ S&P Publishes Low-, Mid- and High Price Homes Indices (pdf) [S&P]
Posted by socketadmin at 8:11 AM | Permalink | Comments (38) | (email story)
November 5, 2007
The Fortune Forecast For Where Home Prices (And Rents) Are Headed
As a plugged-in reader notes, Fortune Magazine looks at historic Price to Rent ratios (pages 76-88) across 54 major metropolitan areas in an attempt to forecast where home prices are headed.
In most markets people won’t lay out much more in monthly costs to own a house or condo than they would to rent a similar property unless they expect a huge profit when they sell. Indeed, speculators chasing quick profits did a lot to inflate the recent bubble. But once the fervor fades, prices must fall to restore their normal, long-term relationship with rents. Rents exercise a kind of inevitable gravitational pull on prices. The ratio of prices to rents “behave much like price/earning rations for stocks,” says Yale economist Robert Shiller. “Like P/Es, price-to-rent ratios are mean-reverting.” In other words, while prices soar from time to time, sending the ration to exceptional heights, sooner or later the relationship is bound to return to its historical average.
Of course, rather than prices falling rents can rise. And while Fortune forecasts a 28.3% correction in the Price to Rent ratio over the next five years for the San Francisco MSA, they’re forecasting it's derived from a 10% drop in prices along with an 18% increase in rents. Over in the East Bay, however, the Fortune forecast is a bit more grim as they're calling for a 38.1% correction driven mainly by price declines of >30%.
And of course, the concept of a housing P/E (and rising rents) shouldn't catch any plugged-in readers by surprise.
∙ Real Estate: Buy, Sell, or Hold? (Pages 76-88) [Fortune Magazine]
∙ Not The “P” But The “E” [SocketSite]
Posted by socketadmin at 3:48 PM | Permalink | Comments (179) | (email story)
October 30, 2007
August S&P/Case-Shiller HPI: San Francisco MSA Falls (But Less)
According to the August 2007 S&P/Case-Shiller Home Price Index (pdf), single-family home prices in the San Francisco MSA slipped 4.2% year-over-year and fell 0.2% from July '07 to August '07. For the broader 10-City composite (CSXR), year-over-year price growth is down 4.9% (down 0.7% from May).
The standard SocketSite S&P/Case-Shiller footnote: The HPI only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the “San Francisco” index (i.e., the greater MSA).
∙ Further Weakening in Home Prices According to the S&P/Case-Shiller® HPI (pdf) [S&P]
∙ July S&P/Case-Shiller Index: San Francisco MSA Continues Decline [SocketSite]
Posted by socketadmin at 6:58 AM | Permalink | Comments (18) | (email story)
October 29, 2007
SocketSite's San Francisco Listed Housing Inventory Update: 10/29
San Francisco’s inventory of Active single-family, condo, and TIC listings fell 1.2% over the past two weeks (as would be expected). At the same time, and for the first time in at least five months, the number of active listings in San Francisco is nominally higher (1.1%) versus the same time last year (as might not be expected).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 10/15 [SocketSite]
Posted by socketadmin at 8:11 AM | Permalink | Comments (86) | (email story)
October 24, 2007
U.S. Existing Home Sales Fall 8% (And Yes, It Might Matters To You)
Sales of previously owned U.S. homes fell 8% in September (19% year-over-year) and the median price paid fell 4.2% compared to September 2006. And while some might point to a national slump as a macro trend that’s irrelevant to us in the micro San Francisco (no slight intended), any drag on the macro economy (think a potential slowdown in consumer spending) will most definitely have an impact on the Bay Area.
Stricter lending standards and higher borrowing costs are making it more difficult to qualify for loans, causing an increase in the number of unsold properties and pulling prices down. Some economists say falling home values, by making owners feel less wealthy, may reduce consumer spending.
"The credit freeze in August definitely impacted sales in September," said Lawrence Yun, a senior economist at the [National Association of Realtors]. The negative influence was greater on jumbo loans, or loans larger than $417,000, affecting high- priced areas such as California, Yun said.
The good news? Another rate cut by the Fed is looking even more likely (think mortgage rates). The bad news? Another rate cut by the Fed is looking even more likely (think our weakening dollar).
And while some might take solace in Goldman Sachs’ chief U.S. economist’s quote that “[e]xisting home sales are still not particularly low by historic standards,” don’t forget the punch line: “Housing still has a lot of weakness ahead of it.”
∙ U.S. Existing Home Sales Fall More Than Forecast [Bloomberg]
∙ Dollar Falls Against Yen on Home Sales Decline, Merrill Loss [Bloomberg]
Posted by socketadmin at 9:17 AM | Permalink | Comments (84) | (email story)
JustQuotes: Will The Effects Ripple, Or Will They Be “Contained?”
“Pointing to a map of ACORN's research showing the hardest hit areas in San Francisco - Ocean View, Bayview, Visitacion Valley, Excelsior - Quezada said she believed lenders and mortgage brokers targeted the area's most vulnerable borrowers.”
∙ 4,800 subprime Bay Area loans at risk of foreclosure by 2008 [SFGate]
Posted by socketadmin at 5:45 AM | Permalink | Comments (10) | (email story)
October 18, 2007
San Francisco's Sales Volume Falls, Broader Bay Area Plummets
According to DataQuick, sales volume (i.e., demand) for existing homes in San Francisco fell 17.3% on a year-over-year basis last month (469 sales in September ’07 versus a revised 567 sales in September ’06) and fell 18.7% compared to the month prior (577 recorded sales in August ‘07). At the same time, the median sales price in September was $773,500, up 1.9% compared to a revised September ’06 ($759,000) but down 5.9% compared to the month prior. (And yes, we’re still thinking mix.)
For the greater Bay Area, sales volume in September was down 40.1% on a year-over-year basis (and no, that's not a typo) and fell 31.3% from the month prior (5,014 recorded sales in September '07 versus a revised 8,374 in September ’06 and 7,299 this past August). The recorded median sales price also fell from the month prior (4.6%), but was up a nominal 0.8% on a revised year-over-year basis.
The number of Bay Area homes purchased with jumbo mortgages dropped from 3,762 in August to 1,935 in September, a decline of 48.6 percent. A jumbo mortgage is a home loan for $417,000 or more. For loans below that threshold, the sales decline was 14.0 percent, from 2,675 in August to 2,301 in September. Historically, sales drop by about 10 percent from August to September.
Outside of San Francisco county, the smallest drop in year-over-year sales volume was recorded in Marin (down 32.5%) and the largest in Contra Costa (down 48.7%).
∙ Bay Area home sales plummet amid mortgage woes [DQNews]
Posted by socketadmin at 11:48 AM | Permalink | Comments (66) | (email story)
October 16, 2007
Foreshadowing A Fall For Northern California? Or Forecasting Folly?
According to DataQuick sales volume plunged last month in Southern California “to the lowest level in more than two decades, as financing with "jumbo" mortgages dropped by half.” And when we (or they) say plunged, we (or they) mean down 29.9% month-over-month, and down 48.5% year-over-year.
And while we’ll have DataQuick’s official September tally for San Francisco (and the greater Bay Area) in the morning, and one plugged-in reader's calculations would suggest that September's transaction volume dropped close to 30% year-over-year, we’re giving you 24 21 hours to go on record with a forecast of your own.
UPDATE (10/17): It looks as though DataQuick won't be releasing their Bay Area numbers until tomorrow (and you have another 18 hours to go on record with your forecasts).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 10/15 [SocketSite]
∙ San Francisco Sales Activity: Reported Sales Volume Takes A Little Hit [SocketSite]
∙ September Southland home sales lowest in more than 20 years [DQNews]
Posted by socketadmin at 9:45 AM | Permalink | Comments (12) | (email story)
JustQuotes: Horton Hears A Who And A Where (Are The Buyers)
"D.R. Horton Inc., the second-largest U.S. homebuilder, said orders in the fiscal fourth quarter plunged [39%] to the lowest in almost six years as customer cancellations soared [up to 48% from 38%] and banks restricted lending."
“The reduced availability of certain mortgage products such as Alt-A loans and tighter underwriting guidelines has reduced the pool of available homebuyers.”
“More than 90 percent of D.R. Horton's buyers used fixed rate mortgages for their purchase and 14 percent had Alt-A financing, the report said. Less than 1 percent were subprime borrowers, UBS said in the Sept. 24 report. Alt-A mortgages are available to borrowers with good credit who generally cannot or choose not to verify their income.”
∙ D.R. Horton Orders Fall to Lowest in Almost Six Years [Bloomberg]
Posted by socketadmin at 7:09 AM | Permalink | Comments (0) | (email story)
October 15, 2007
SocketSite's San Francisco Listed Housing Inventory Update: 10/15
New listings continued to outnumber new sales over the past two weeks in San Francisco as inventory of Active single family, condo, and TIC listings increased 3.4% (and has closed to within 1% of last year’s levels).
And as winter months are typically characterized by a general slow down in activity (both sales and new listings) along with the withdrawal of listings by those under no pressure to sell, we’ll be watching inventory levels over the next couple of months for any early signs of increased urgency in the market.
∙ SocketSite's San Francisco Listed Housing Inventory Update: 10/1/07 [SocketSite]
Posted by socketadmin at 8:15 AM | Permalink | Comments (27) | (email story)
October 10, 2007
NAR's Monthly Moving Target (October Edition)
For the eight month in a row, the National Association of Realtors has lowered their annual sales forecast for existing homes across the nation. And the latest forecast now calls for an 11 percent drop in sales (down from 8.6% last month). At the same time, however, the median existing home price is now forecast to drop only 1.3 percent (versus last month’s forecast of a 1.7 percent decline).
“The forecasts signal the housing decline is deepening and the market isn't recovering. Mortgage lenders such as Countrywide Financial Corp., the largest, and Wells Fargo & Co., the second-biggest, have raised standards in reaction to a surge of foreclosures, Donald Kohn, Federal Reserve vice chairman, said in an Oct. 5 speech in Philadelphia.”
∙ U.S. Existing Home Sales May Drop to Five-Year Low [Bloomberg]
∙ JustQuotes: NAR's Monthly Moving Target (September Edition) [SocketSite]
Posted by socketadmin at 8:26 AM | Permalink | Comments (43) | (email story)
October 9, 2007
Those Damn Neighbors: The Bridgeview (And Bank Owned) Edition
400 Beale #1501 has been on the market for a little over a month. Advertising the largest 2 bedroom, 2 bath floor plan at the Bridgeview and a “huge final price reduction” of $24,000 (2.4%), it’s currently listed at $975,000.
Enter 400 Beale #1201. It’s the same largest floor plan as #1501 (albeit three floors below). It’s another bank owned (REO) condo in the Bridgeview (no, not Bayview). And it’s now on the market for $825,000.
And while it appears that #1201 might be tenant occupied (which could affect the price), and those three floors do make a difference on the Bay (but not necessarily bridge) views, we're still calling it a concerning comp (but not quite a troubling trend).
∙ Listing: 400 Beale #1201 (2/2) - $825,000 [MLS]
∙ Listing: 400 Beale #1501 (2/2) - $975,000 [MLS]
∙ The SocketSite Scoop On That Short Sale In Rincon Hill [SocketSite]
Posted by socketadmin at 8:21 AM | Permalink | Comments (43) | (email story)
October 2, 2007
The National Association of Realtors Pending Home Sales Index Falls
Citing mortgage woes, the National Association of Realtors reports that their forward-looking national Pending Home Sales Index (based on signed contracts) fell 6.5 percent from July to August and is down 21.5 percent year-over-year. In the West, the Index fell 2.7 percent and is down 27.1 percent as compared to August 2006.
“The impact was greater in high-cost markets that are more dependent on jumbo mortgages. In some areas, as much as 30 percent of signed contracts were falling through in August when the credit crunch problem peaked,” [NAR senior economist] Yun said. “The problem has since become less severe, though jumbo loan rates are still higher than they would be under normal conditions. Therefore, sales activity in late fall will better reflect market fundamentals.”
We're not exactly sure what "normal conditions" may be (and if anything would argue that the past few years have been anything but), but we do understand fundamentals (a return to which might not be such a great thing for the market).
And citing mortgage woes of thier own, today Morgan Stanley announced a 25% reduction in “residential mortgage origination and servicing jobs.” Which isn't a great thing for 600.
∙ Mortgage Problems Continue to Hamper Pending Home Sales [realtor.org]
∙ Morgan Stanley Cuts 600 Jobs in Home Loan Business [Bloomberg]
Posted by socketadmin at 8:39 AM | Permalink | Comments (4) | (email story)
October 1, 2007
The Next Era In San Francisco’s Development: It’s All About Density
Going green might be trendy (and we’re all for it), but as far as we’re concerned it’s a focus on density (and infill) that will define the next era in San Francisco’s development, neighborhoods, and lifestyle.
Speaking of (or on) which, David Baker will be delivering a "Better Living Through Density" lecture next Monday (10/8/07 @ 7pm) at the California College of The Arts (Timken Lecture Hall, 1111 Eighth Street, San Francisco).
Denser neighborhoods are more active, more interesting, safer places that support local retail and services and foster community. But what makes urban housing beautiful and functional for residents and neighborhood alike? David Baker will describe—using some of his own work as examples—the components of good urban design, including active pedestrian edges, the hierarchy of open spaces, sensible parking strategies, and sustainable approaches that make higher densities better for all.
It’s free, no RSVP is required, and additional information is available by phone (415.703.9562) or email (architecture@cca.edu).
∙ California College of the Arts: Calendar of Events [CCA]
Posted by socketadmin at 2:07 PM | Permalink | Comments (91) | (email story)
SocketSite's San Francisco Listed Housing Inventory Update: 10/1/07
New listings continued to outnumber new sales over the past two weeks in San Francisco as inventory of Active single family, condo, and TIC listings increased 5.2% (and has closed to within 3% of last year’s levels).
At the same time, we are starting to see the seasonal withdrawal of unsold listings and a quarter of all Active listings have been reduced in price at least once (versus a fifth at the same point in time last year). And while condos represented 60% of the reduced inventory on October 1, 2006, as of this morning they represented less than half (by 1%).
∙ SocketSite's San Francisco Listed Housing Inventory Update: 9/17/07 [SocketSite]
Posted by socketadmin at 10:30 AM | Permalink | Comments (53) | (email story)
September 28, 2007
JustQuotes: Don’t Shoot (But Feel Free To Debate) The Messenger(s)
“A recession within the next 12 months is likely and its impact on the Bay Area will be "sharp but short" due to the area's strong economic underpinnings, according to a new forecast.”
“A recession will be brought on by slowing consumer spending prompted by a cooling housing market, said economist Jon Haveman. "People who have seen their house values rise 10 to 15 percent annually have been spending accordingly," he said. The Bay Area housing market is overpriced and Haveman expects prices to drop by as much as 20 percent by 2009 before stabilizing.”
“While the forecast, presented to business executives this month, predicts a relatively short recessionary period, there are risks to the local economy. Among them is the commercial real estate market, Haveman said.
Low interest rates allowed unprecedented speculation on office space. If lease rates dip, that could trigger an unraveling of mortgage-backed securities in the commercial market, the forecast said. "The same excesses in the mortgage markets have also been seen in commercial markets," Haveman said.” (Bay Area may be in for short, sharp shock)
Posted by socketadmin at 2:30 AM | Permalink | Comments (14) | (email story)
September 27, 2007
JustQuotes: The Bigger Picture Is Looking A Bit Bleak
“Fannie Mae Chief Executive Officer Daniel Mudd said the [national] housing slump will last beyond next year, dragging down home prices and increasing credit losses at the largest provider of financing for U.S. mortgages. ‘We don't think we hit a bottom until the end of '08 and then we have some period of time to work our way back up again,’ Mudd said today in an interview in Washington.”
“Sales of new homes in the U.S. dropped more than forecast in August and prices plunged by the most since 1970, underscoring the Federal Reserve's concern about the broader economy. Purchases declined 8.3 percent to an annual pace of 795,000, the lowest level in more than seven years, the Commerce Department said today in Washington. The median price dropped 7.5 percent from a year ago.”
“Sales fell in two of four regions. The decline was led by a 21 percent slump in the West and a 15 percent drop in the South. Purchases increased 42 percent in the Northeast and 21 percent in the Midwest.”
∙ Housing Slump to Last Beyond 2008, Fannie's Mudd Says [Bloomberg]
∙ U.S. Economy: New-Home Sales Decline 8.3 Percent [Bloomberg]
Posted by socketadmin at 9:30 AM | Permalink | Comments (5) | (email story)
September 26, 2007
Which Five Years Will The Next Five Years More Likely Resemble?
213 Moulton is a contemporary single-family home situated down a little alley in Cow Hollow. It first sold for $545,000 in 1995. And ten years later (in 2005) it changed hands for $1,672,000. No doubt about it, that's fantastic long-term appreciation. Then again, it also changed hands in the year 2000 for $1,600,000.
We only mention it now as 215 Moulton (part of the same three home development) has been on the market for a month and has recently reduced its list price $145,000 (or 7.3%). They’re now asking $1,850,000 which includes a new full bath (added in 2006) and reclaimed living space on the ground floor.
∙ Listing: 215 Moulton (3/3.5) - $1,850,000 [MLS]
Posted by socketadmin at 11:45 AM | Permalink | Comments (17) | (email story)
September 25, 2007
July S&P/Case-Shiller Index: San Francisco MSA Continues Decline
And speaking of the S&P/Case-Shiller index (and no, that wasn't a coincidence), according to the July 2007 index (pdf), single-family home prices in the San Francisco MSA slipped 4.1% year-over-year and fell 0.4% from June '07 to July '07. For the broader 10-City composite (CSXR), year-over-year price growth is down 4.5% (down 0.5% from May).
The standard SocketSite footnote: The S&P/Case-Shiller index only tracks single-family homes (not condominiums which represent half the transactions in San Francisco), is imperfect in factoring out changes in property values due to improvements versus actual market appreciation (although they try their best), and includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the “San Francisco” index (i.e., the greater MSA).
∙ They're Betting Against San Francisco On The CME [SocketSite]
∙ Summer Swoon Evident in the S&P/Case-Shiller® Home Price Indices (pdf) [S&P]
∙ June S&P/Case-Shiller Index: San Francisco MSA Mimics U.S. Decline [SocketSite]
Posted by socketadmin at 8:00 AM | Permalink | Comments (9) | (email story)
They're Betting Against Us (San Francisco) On The CME
It was a little over a year ago (May 2006) that housing futures based on the S&P/Case-Shiller index for ten Major Metropolitan Areas (as well as a ten city composite) began trading on the Chicago Mercantile Exchange (CME). And it was last week that the market was expanded to include contracts of up to five years in duration.
A few important things to keep in mind: liquidity and open interest in the CME housing markets are painfully low; the “San Francisco” index includes San Francisco, San Mateo, Marin, Contra Costa, and Alameda counties; and the index is based on changes of single-family home values (and not condos). That being said, the market does represent real traders betting real money on movements in the local housing market.
And what say the traders about the San Francisco MSA? Well, as of today traders on the CME are betting home values in the San Francisco will drop almost 7% over the next year; 14% over the next two; and a total of 24% over the next four (down roughly 7% a year). And that’s the second to worst four-year performance of any of the ten markets (with traders betting that Miami will drop 25%).
Again, it’s a thinly traded market with significant bid/ask spreads (especially on the longer duration contracts), and it’s not specific to “San Francisco” county. But these are real dollars at work. It is another data point worth watching (if not for magnitude, then at least for direction). And yes, we'll keep you plugged-in.
∙ Chicago Mercantile Exchange (CME) Housing [CME]
∙ CME Group Extends Offerings of S&P/Case-Shiller Housing Contracts [CME]
∙ June S&P/Case-Shiller Index: San Francisco MSA Mimics U.S. Decline [SocketSite]
Posted by socketadmin at 4:00 AM | Permalink | Comments (34) | (email story)
September 19, 2007
841 Webster Returns: And Perhaps It's Now “Priced to Rent!”
As a tipster notes, 841 Webster (which failed to sell at $989,000 despite four months on the market, a total of $310,000 in reductions, and advertising “Priced to Sell!”) has returned to the market as a rental. And according to craigslist, they're looking for $4,950 a month. We’ll just let you run the numbers (and debate that little note of NOPA).
∙ $4950 / 3br - Remodeled Victorian Flat...(alamo square / nopa) [craigslist]
∙ What’s Moving (Or Not) And For How Much (Or Little): Withdrawn [SocketSite]
∙ Betting On A Bidding War? (Once Again) [SocketSite]
∙ To Rent Or To Buy, That Is The Question (That Only You Can Answer) [SocketSite]
∙ And Like There’s Any Chance We Could Resist (700 Broderick) [SocketSite]
Posted by socketadmin at 8:46 AM | Permalink | Comments (18) | (email story)
Bay Area Up But San Francisco Down (And That’s A Good Thing)
According to the Chronicle (and RealtyTrac), while "Bay Area foreclosure activity skyrockets” in August, notices of default and trustee sales actually decreased on a year over year basis in San Francisco. And while foreclosure activity remains relatively insignificant right here (at least right now), we’ll keep you plugged-in should that start to change.
∙ Bay Area foreclosure activity skyrockets [SFGate]
∙ Bay Area “Notices Of Default” Heading North? (So To Speak) [SocketSite]
Posted by socketadmin at