October 21, 2015

The Rocks Reveal Themselves

The Marin Independent Journal reports from California. “After an almost uninterrupted streak of increases over the last few years, the median price of a Marin home fell 14 percent in September, to $970,000, according to CoreLogic. In this case, the drop in the median price is more apparent than real, according to an analyst and several Marin real estate agents. ‘The drop in the median price reflects a change in the types of homes selling, not a drop in home prices,’ said Andrew LePage, an analyst with CoreLogic. ‘In September 2014, the larger high-end municipalities had 40 percent of the sales in the county,’ LePage said. ‘This September, they had 33 percent. That’s going to tug down the median.’”

“Teya Walkker, an agent with Coldwell Banker, said the healthy market has been fueled at least in part by high prices in San Francisco. ‘The prices in San Francisco are so high, people are looking for alternatives,’ she said. Walkker also said some Marin residents are looking to move to Sonoma County. ‘Marinites who have been living here for a long time feel it’s overcrowded. They are looking for peace and quiet,’ the agent said.”

The Press Democrat. “A significant number of Sonoma County home sellers ended the summer by putting their properties on the market, contributing to the largest number of signed sales agreements in September in at least six years. New listings increased 22 percent last month from a year earlier to 537 single-family homes, according to The Press Democrat’s monthly housing report compiled by Pacific Union International VP Rick Laws. It was the third straight month where new listings rose on a year-over-year basis.”

“The jump in listings didn’t result in an increase in completed sales last month. Buyers purchased 396 single-family homes in September, a decline of 12 percent from a year earlier. Buyers are no longer feeling pushed by worries over rising prices, brokers said. For the buyers, ‘there’s no sense of urgency,’ said Vicki Roberts, a broker associate with Bertolone Realty in Santa Rosa. Many sellers, meanwhile, have had homes sitting on the market for months, but ‘I don’t see a lot of price reductions.’ The market, she said, is ‘transitioning, and who knows to what.’”

The Mercury News. “Pacific Union agent Wendy Kandasamy, based in Palo Alto, noticed ‘a wobble in the market’ that made for a less robust September for the Peninsula area than she had anticipated. She theorized that late August instabilities in the financial markets had continued to reverberate through the local real estate scene. ‘When the high tide comes — when you have a really high market — it kind of covers all the rocks,’ she said. ‘But this market is not an even market. Now, the rocks reveal themselves.’”

“She offered several examples of the market’s unevenness. In Portola Valley, she represented buyers who went after a $2.7 million home: 2,400 square feet with three modest bedrooms. The buyers got it for $2.65 million: ‘When there’s uncertainty in the market, it gives people the motivation to negotiate,’ Kandasamy said.”

“Around the same time, she listed a 1,600 square-foot home in Menlo Park for $1.7 million. It sat on the market for three weeks, then drew multiple offers after the sellers reduced the price by $100,000 — and finally sold for just under $1.7 million. A $1.8 million home in Foster City — ‘a weaker market’ — also drew a number of offers, but ‘they weren’t strong ones and we ended up not accepting any.’ That property has been taken off the market until spring.”

The Appeal Democrat. “Long-standing plans for the mixed-used Magnolia Ranch development north of Wheatland go before the county planning commission this week — the last step before final consideration by county supervisors. Plans for the project include 3,300 mixed-use dwellings, a 52-acre business park, 60 acres of open space, 45 acres of parks and 18 acres of neighborhood commercial development. Residential is proposed to go in first, developers say, because the infrastructure needed for new homes needs to be in place before industrial development can occur. They also maintain that additional housing in the county will help keep the overall housing market affordable.”

“Opponents maintain there are too many vacant single-family residential lots in Yuba County to start adding more. The project would also result in housing developments that would be too spread out, further creating isolated, ‘leap frog’ communities such as Plumas Lake. County officials acknowledge there are currently about 12,000 vacant residential lots in Plumas Lake and another 3,000 at Edgewater Estates.”




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61 Comments »

Comment by Ben Jones
2015-10-21 03:52:23

‘Skyrocketing Rent in Sacramento Region’

‘Housing experts say more people are choosing to rent rather than buy homes. And with falling income levels over the past half-dozen years and stricter loan requirements since the housing bubble, many families can’t buy even if they want to. Karina Ambriz and her family live in one of those complexes. She wants to eventually buy a house but not in the immediate future.’

“I can’t imagine buying a house right now … for right now, I’m going to be renting,” Ambriz said.’

‘Iskow says rents will remain high for the foreseeable future because young millenials like Karina are putting off home buying because it’s hard to qualify for a loan after the housing crash. Iskow also says some see no need to lock themselves into long-term debt. “They’re not only putting off home buying, but they are questioning the whole value of home buying because they lived through the hosing bubble,” Iskow said.’

Comment by Mafia Blocks
2015-10-21 04:40:04

“I can’t imagine buying a house right now … for right now, I’m going to be renting,”

Why buy it when you can rent it for half the monthly cost?

Comment by Jingle Male
2015-10-22 07:37:15

“……Iskow says the only near-term solution for affordable rents is perhaps raising the minimum wage and increasing government subsidies for low-income earners….”

Whatever you do, don’t make it easier or less expensive to build more housing. Everyone would be housed and no one would need government. Sheesh!

Comment by Mafia Blocks
2015-10-22 18:02:56

With 25 million excess, empty and defaulted houses, there is no need to build more houses.

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Comment by Karen
2015-10-21 10:38:18

Gosh, do you think at some point falling income levels might interfere with the plan to keep raising rents?

There are no HELOC’s for renters, no modifications or payment plans, no lowering of principal or interest rates, no living for years without making a monthly payment, no government agencies to help you out.

Just that bill that’s got to be paid every month or you get evicted.

Comment by AmazingRuss
2015-10-21 12:02:33

For now, it’s raining money in the bay area. I pay an exorbitant rent, but I bank quite a bit more.

Comment by Mafia Blocks
2015-10-21 12:30:10

Nothing like have big piles of cash with no debt, no obligation, no bills.

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Comment by Karen
2015-10-21 13:09:54

It certainly isn’t raining money on everyone in the Bay Area. We’ve seen articles posted recently about tech firm layoffs.

Besides, this isn’t just about you and it isn’t just in SF. It’s everywhere.

These apartment owners are pushing the narrative that rents are going to the moon. Look at what Ben posted about how mcuch they’re paying per door to buy apartments.

I would think they’ll run into the wall much more quickly than with single-family home sales, due to all the factors I posted above.

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Comment by GuillotineRenovator
2015-10-21 15:15:30

These are absolutely bizarre times we are living in.

 
Comment by ocsandrenter
2015-10-22 07:47:01

I would think they’ll run into the wall much more quickly than with single-family home sales, due to all the factors I posted above.

Yep. The higher they raise the rent the less discretionary income to be spent on consumption thereby lowering the GDP. The PTB are so excited to finally be sparking up inflation via rent increases - shortsighted fools directing the raft don’t see the waterfall we’re approaching rapidly.

 
Comment by Mafia Blocks
2015-10-22 17:47:00

Well… that’s not inflation.

 
 
 
Comment by FL_Skeptic
2015-10-21 16:37:08

Salaries are a problem:

We just got more evidence that the middle class in America is dying. According to brand new numbers that were just released by the Social Security Administration, 51 percent of all workers in the United States make less than $30,000 a year. Let that number sink in for a moment. You can’t support a middle class family in America today on just $2,500 a month – especially after taxes are taken out. And yet more than half of all workers in this country make less than that each month. In order to have a thriving middle class, you have got to have an economy that produces lots of middle class jobs, and that simply is not happening in America today.

http://endoftheamericandream.com/archives/goodbye-middle-class-51-percent-of-all-american-workers-make-less-than-30000-dollars-a-year

Comment by Mafia Blocks
2015-10-21 17:25:49

…. hence the reason prices are falling. And they’ll continue to fall to dramatically lower and more affordable levels.

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Comment by Mugsy
2015-10-21 04:13:50

“She offered several examples of the market’s unevenness. In Portola Valley, she represented buyers who went after a $2.7 million home: 2,400 square feet with three modest bedrooms. The buyers got it for $2.65 million: ‘When there’s uncertainty in the market, it gives people the motivation to negotiate,’ Kandasamy said.”

They got the sellers down 2% huh? Awesome negotiation skills.

Comment by Jingle Male
2015-10-21 04:24:32

Yes! Almost below $1,000/SF. Think of all the money HA could make building nw product at $55/SF. HA!

Comment by Mafia Blocks
2015-10-21 04:53:58

You haven’t built a thing in your life Jingle_Fraud.

 
 
Comment by scdave
2015-10-21 08:05:10

I saw that also Mugsy…Made me laugh a bit…

 
 
Comment by Ben Jones
2015-10-21 04:46:41

678 properties found Marin County, CA Real Estate and Homes for Sale

http://www.realtor.com/realestateandhomes-search/Marin-County_CA/type-single-family-home,condo-townhome-row-home-co-op,multi-family-home,mfd-mobile-home

221 properties found Marin County, CA Price Reduced Homes for Sale

http://www.realtor.com/realestateandhomes-search/Marin-County_CA/type-single-family-home,condo-townhome-row-home-co-op,multi-family-home,mfd-mobile-home/show-price-reduced

‘Walkker also said some Marin residents are looking to move to Sonoma County. ‘Marinites who have been living here for a long time feel it’s overcrowded. They are looking for peace and quiet’

When I was in San Francisco a few years ago, I noticed police and ambulance sirens never seemed to stop.

Comment by AmazingRuss
2015-10-21 06:33:52

It’s constant down town. Less frequent as you move west, and I hear maybe 3 a week living in the forest area south of the golden gate bridge.

 
Comment by scdave
2015-10-21 08:10:44

I noticed police and ambulance sirens never seemed to stop ??

850,000 people plus visitors crammed into 46 square miles your likely going to here a lot of that…I suspect its the same in every major city…

Comment by Mafia Blocks
2015-10-21 08:13:42

Others cities have nothing on the round the clock sirens and gun fire here in SF(I live in SF. Check my IP address).

 
Comment by Jingle Male
2015-10-22 15:11:05

Paris has 2.3 million people in the same 47 sq. mile area and the sirens, police and traffic are endless. People still seem to like living there and visiting.

Comment by Mafia Blocks
2015-10-22 17:45:53

I’ve lived in Paris. It’s no different than any other city but not nearly as noisy and crime ridden as SF.

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Comment by Rental Watch
2015-10-21 08:42:01

I grew up in Sonoma County. When I went back to my hometown a few years ago, I ran into a classmate, who runs his family plumbing business. He said that the town was changing, and that seemed more like “Marin North” than Sonoma County.

The migration northward has been going on for a long time.

 
 
Comment by Ben Jones
2015-10-21 05:47:44

‘She theorized that late August instabilities in the financial markets had continued to’ reverberate through the local real estate scene’

Twitter, Inc. (TWTR)
Pre-Market : 29.33 Down 1.58 (5.11%) 8:44AM

52wk Range: 21.01 - 53.49

EPS (ttm): -0.95

http://finance.yahoo.com/q?s=twtr&ql=1

 
Comment by Ben Jones
2015-10-21 05:56:22

‘The San Francisco housing market is notoriously insane right now. However, maybe don’t try to get around it by squatting in a conveniently vacant $12.5 million mansion abandoned by a bankrupt tech bro, and helping yourself to hundreds of thousands of dollars worth of artwork left hanging on its walls.’

‘That strategy didn’t work for 39-year-old Jeremiah Kaylor, who was busted this weekend for doing exactly that over the past two months. Though the exact address of the Presidio Heights dwelling wasn’t revealed, real estate blog Curbed SF speculates that it’s a “grand but dilapidated” manse dubbed “Le Petite Trianon” (modeled after the real one in Versailles), originally listed for sale at $25 million back in 2012. It’s been vacant, with a steadily declining asking price, for years.’

‘ABC News notes that the paintings were sold to pawn shops and via social media for less than their appraised value, and all but two were quickly recovered. The outlet also called the mansion “unkempt” and said that police say it’s unclear who actually owns the stolen artwork. Curbed SF and Business Insider both name the property owner as CNET founder Halsey Minor, of whom Business Insider says: “In 2001, Minor’s net worth was $180 million. He sold CNET to CBS for $1.8 billion in 2008. By 2013, however, he was filing for bankruptcy, most likely due to his expensive taste in real estate, art, and horses.”

Comment by GooglerInSF
2015-10-21 06:01:25

Oh yes, I remember Halsey. Man, what a jerk.

Comment by AmazingRuss
2015-10-21 06:35:38

“Minor’s net worth was $180 million. He sold CNET to CBS for $1.8 billion in 2008. By 2013, however, he was filing for bankruptcy, most likely due to his expensive taste in real estate, art, and horses.””

That’s definitely mental illness.

Comment by inchbyinch
2015-10-21 08:01:42

5 years after becoming a “gross” billionaire (worth 100’s of millions, I assume net) the guy files a BK. He proves there is a difference between having $ and having intelligence.

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Comment by scdave
2015-10-21 08:15:24

guy files a BK. He proves there is a difference between having $ and having intelligence ??

We have a guy that some say is quite intelligent running for President that is a BK Kingpin…

 
Comment by Blue Skye
2015-10-21 08:25:58

“BK Kingpin”

Maybe you mean poster child or something. Anyway, Trump has never filed for personal bankruptcy. Personal responsibility for business loss is not how things are done these days.

 
Comment by scdave
2015-10-21 08:41:42

Personal responsibility for business loss is not how things are done these days ??

Well sure there is no personal responsibility when you are pissing away other peoples money shielded by the corporate curtain…

 
Comment by Rental Watch
2015-10-21 08:47:14

Lenders (those on the other side of a BK) know how to demand personal responsibility for the debt…they get personal guarantees.

If they lent to an entity without a personal guarantee, they knew and accepted the risks of not having Mr. Trump’s balance sheet as collateral.

 
Comment by scdave
2015-10-21 11:32:00

they get personal guarantees ??

I have signed many of them over the years….

 
Comment by Rental Watch
2015-10-21 12:17:27

“I have signed many of them over the years….”

And if one of the loans DIDN’T have personal recourse (or springing recourse upon filing BK), would you consider filing BK for an entity if it meant you had a chance to salvage some equity in the company?

Do you think any third party investors would EXPECT you to file in an attempt to protect their investment?

These situations can get hairy given the different interests involved.

If there is a reasonable path through BK and maybe salvage shareholder equity, and the manager of a company does NOT file BK (placing their reputation ahead of shareholder equity), you can expect the shareholders to file suit against the manager.

 
 
 
 
Comment by rj chicago
2015-10-21 08:16:26

And let’s see - who has been in control of SF for low these last several decades. Eventually you run out of other people’s money. Yikes.
million dollar condos while bums are crapping in the street - sides like a utopian paradise to me.

Comment by AmazingRuss
2015-10-21 12:07:37

You should visit. It’s an amazing place… not at all the flyoverlander’s imagined dystopia you’re making of it.

Comment by Ethan in Northern VA
2015-10-21 13:09:27

Was just there a few months ago and wandered into what they call the Tenderloin (thanks Waze) as dusk was hitting. It was sketch.

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Comment by Karen
2015-10-21 13:15:46

It’s been a few years since I’ve been there. When I went I was surprised by the number of street people, even in the nicer downtown areas. Pretty unnerving to have these eyes following you everywhere. I did not feel comfortable.

 
Comment by AmazingRuss
2015-10-21 14:18:24

The tenderloin and civic center area is the armpit… but I like riding through there and observing the freak show at night. You must never stop there, though.

The embarcadero is about 5 miles long, and filled with beautiful things to look at. At the end of the embarcadero is the trail through Chrissy Field to the Golden Gate Bridge and the observation area up there, which is amazing, and you can go across to Baker Beach and lands end, which are amazing… and golden gate park is huge and crisscrossed with dirt bike trails. I could go on and on, but that would probably get obnoxious.

A good rule of thumb is if you can see water, you’re someplace nice, and the further north you go the nicer it is. Every time I came here as a tourist I went to the same places you did probably… market st, the tenderloin, chinatown, fishermans wharf, all of which are dirty and kind of meh.

Have biked around the city to the tune of about 3000 miles since I got here, and discovered all kinds of stuff. I have loved living here, and I have lived in rural areas my whole life. It’s like being on vacation all the time.

 
Comment by Mafia Blocks
2015-10-21 14:44:23

Being surrounded by roving bands of criminals, junkies and sexual predators isn’t my idea of a vacation.

 
Comment by AmazingRuss
2015-10-21 19:05:58

Hunkering down terrified in your house more your speed?

 
Comment by Mafia Blocks
2015-10-21 19:15:59

I don’t vacation in the ghetto or my house.

 
Comment by AmazingRuss
2015-10-22 15:57:27

Up above you claimed to live in SF.

 
Comment by Mafia Blocks
2015-10-22 17:44:27

That was yesterday Lola. I live in Seattle today. Honest. Check my IP address.

 
 
 
 
 
Comment by Senior Housing Analyst
2015-10-21 06:01:01

7,955 nearby properties found Portland, OR Real Estate and Homes for Sale

http://www.realtor.com/realestateandhomes-search/Portland_OR?ml=4

2,800 nearby properties found Portland, OR Price Reduced Homes for Sale

http://www.realtor.com/realestateandhomes-search/Portland_OR/show-price-reduced?ml=4

35% of all Portland OR sellers reduced their price at least once.

 
Comment by Professor Bear
2015-10-21 06:06:53

“After an almost uninterrupted streak of increases over the last few years, the median price of a Marin home fell 14 percent in September, to $970,000, according to CoreLogic. In this case, the drop in the median price is more apparent than real, according to an analyst and several Marin real estate agents. ‘The drop in the median price reflects a change in the types of homes selling, not a drop in home prices,’ said Andrew LePage, an analyst with CoreLogic. ‘In September 2014, the larger high-end municipalities had 40 percent of the sales in the county,’ LePage said. ‘This September, they had 33 percent. That’s going to tug down the median.’”

Sounds like the all-cash Chinese investors may have left the market.

Comment by scdave
2015-10-21 08:18:15

all-cash Chinese investors may have left the market ??

I have no way of knowing but my suspicion is that Marin is not high on the Chinese buyer radar…

Comment by Bluto
2015-10-21 13:54:09

That is my understanding too, very little Chinese RE investment north of the Golden Gate bridge.
BTW, Movoto completely screwed up the numbers for Santa Rosa in Sonoma Co. (just north of Marin) for September, until a few weeks their (erroneous) data made it look like Bubble 2.0 had finally popped here. This months numbers jibe with other sites, prices have not dropped (yet) but inventory is at a 4 year high so it shouldn’t be long.
(I tried contacting Movoto, no reply, don’t know if their data is unreliable for other areas)

http://www.movoto.com/santa-rosa-ca/market-trends/#city=&time=5Y&metric=Median%20List%20Price&type=0

 
 
 
Comment by BigSky
2015-10-21 07:06:50

Then there is this headline this morning:

Wall Street bonuses headed down; layoffs predicted

Kaja Whitehouse, USA TODAY 8:02 a.m. EDT October 21, 2015

It hasn’t made the headlines or even the sections of the Wall Street Journal yet.

Comment by scdave
2015-10-21 08:20:02

We have seen a number of different layoffs across all industry…It will be interesting to watch the unemployment numbers over the next few months although Christmas hiring may skew the real numbers…

Comment by Blue Skye
2015-10-21 08:27:39

Are we all poised to run up $5,000 on the credit card to pile Christmas presents three feet deep under the tree?

Comment by snake charmer
2015-10-21 09:06:15

I’m far from the first to notice this, but every year we have the same news stories on holiday sales numbers. They’re better than expected, and then they aren’t.

Don’t even get me started on stories about doorbuster sales at midnight and people lining up and even fighting each other for something that will be in the dumpster soon enough. The long Thanksgiving weekend has become a shopping-and-television orgy so grotesque and devoid of real thankfulness that the original Pilgrims probably would retch.

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Comment by Blue Skye
2015-10-21 09:28:37

You can have it any way you want it. I like Thanksgiving because there isn’t any “tyranny of gifts”. Family, too much good food and plenty to drink. If we don’t go to the mall or watch TV, what’s not to like.

 
Comment by Ethan in Northern VA
2015-10-21 13:11:24

I got my first bulk unsolicited email today with a pre-Christmas sale from a company I’ve done business with in the past.

 
 
 
 
Comment by taxpayers
2015-10-21 10:59:57

about 350,000 bankers world wide have been canned

gov workers are eternal

 
 
Comment by Senior Housing Analyst
2015-10-21 09:19:19

28,318 nearby properties found Tampa, FL Real Estate and Homes for Sale

http://www.realtor.com/realestateandhomes-search/Tampa_FL?ml=4

10,270 nearby properties found Tampa, FL Price Reduced Homes for Sale

http://www.realtor.com/realestateandhomes-search/Tampa_FL/show-price-reduced?ml=4

36% of Tampa, FL sellers reduced their price at least once.

 
Comment by Senior Housing Analyst
2015-10-21 09:20:40

Tampa, FL Housing Prices Crater 8% YoY

http://www.zillow.com/hunters-green-tampa-fl/home-values/

Comment by taxpayers
2015-10-21 11:01:30

a month ago zillow had fl boomin plus 6-8%

Comment by Mafia Blocks
2015-10-21 14:35:26

And now its cratering. Oh my word.

 
 
 
Comment by Senior Housing Analyst
2015-10-21 15:29:17

Sacramento, CA Foreclosure Rate Skyrockets 49%

http://www.capradio.org/57264

 
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