Advertising price drops in San Carlos
92 MADERA Ave, San Carlos, CA 94070 | MLS# 80835403
92 MADERA Ave San Carlos, CA 94070
Price: $899,998
Beds: 4
Baths: 2.5
Sq. Ft.: 2,400
$/Sq. Ft.: $375
Lot Size: 6,604 Sq. Ft.
Property Type: Detached Single Family
Style: Contemporary
Stories: 2
View: Bay, Canyon, Neighborhood, City Lights
Year Built: 1934
Community: Beverly Terrace
County: San Mateo
MLS#: 80835403
Source: MLSListings
Status: Active
On Redfin: 221 days
Amazing price for this square footage. .. appraised at $1,234,000 in 2007. Gorgeous Bay Views. Spacious home approx 2400 sq ft. Upper level w/ adjoining family room, living room, 1/2 bath. Downstairs 4 bedrooms, office, 2.5 baths. Parquet and hardwood under upper level carpeting. Two decks. This is NOT a short sale.
Burbed reader Sam thought this was an interesting find. Here’s what he had to say:
Want to close your sale faster? Highlight a declining market! (Ignore the 1991 $358,000 sale, roughly 600K in 2009 dollars, it’s irrelevant)
Well, actually the 1991 sales price is important. As we all know. real estate doubles every 10 years. So… by 2011 (2 years from now) it should be worth $1.432M. That makes sense. Highlighting the $1.234M (what a funny number) today indicates just how much instant equity there is available for you to unleash. And, that it is on track to reach that magically doubling number – if it weren’t for the pesky economic woes we have right now.
So get on the right track and buy this very green, very airy house today!
Thanks Sam!
May 4th, 2009 at 7:23 am
I’ve never seen so many changes in a listing…
Apr 20, 2009 Price Changed $899,998 — MLSListings #80835403
Apr 17, 2009 Price Changed $925,000 – MLSListings #80835403
Apr 15, 2009 Listed $898,888 – San Francisco MLS #355339
Mar 26, 2009 Price Changed $940,000 – MLSListings #80835403
Mar 19, 2009 Price Changed $949,000 – MLSListings #80835403
Feb 27, 2009 Price Changed $950,000 – MLSListings #80835403
Jan 24, 2009 Price Changed $988,888 – MLSListings #80835403
Nov 15, 2008 Price Changed $999,999 – MLSListings #80835403
Nov 05, 2008 Price Changed $1,025,000 – MLSListings #80835403
Oct 08, 2008 Price Changed $1,100,000 – MLSListings #80835403
Sep 21, 2008 Listed $1,188,888 – MLSListings #80835403
May 4th, 2009 at 10:10 am
That is what we call chasing the market down…
May 4th, 2009 at 10:16 am
Loan in 2002 for $375k (ARM/World Savings)
Loan in 2004 for $550k (ARM/Downey Savings)
The 2004 transaction shows up as a resale (divorce?).
May 4th, 2009 at 10:27 am
This home and price history is a good example of how sellers (and buyers) falsey evaluate home prices after the initial drop post-bubble. One should not base the asset value on the bubble-top price, but rather true metrics around area income, employment, savings, credit availability, loan types (ie. alt-a, option-arms) etc. and what the value was pre-bubble.
It’s ridiculous to think that post-bubble asset evaluations have any relation to bubble evaluations.
Here’s some good insight:
http://www.oftwominds.com/blogapr09/housing04-09.html
Not what most bubble-buyers want to hear or think about, but it is likely the truth. Time will tell.
May 4th, 2009 at 10:28 am
Lol – I wonder: Did someone actually think that this was worth $1.234 mil?
All I have to say is that anyone who did doesn’t actually have money.
May 4th, 2009 at 10:31 am
979 Orange Ave, San Carlos
Asking: $849k
Last Sale: $950k
May 4th, 2009 at 10:35 am
You didn’t need income, assets, or a job during the bubble; that’s why they called them Ninja loans. The government is still trying all it can to prop up home prices. What else could explain the current $729k FHA limit in places Salinas or Watsonville?
May 4th, 2009 at 11:17 am
appraised at $1,234,000 in 2007
Man, I think that’s funny too. The second sentence in the listing, therefore it must be the second most important thing about this house.
May 4th, 2009 at 11:36 am
If we value this property relative to rents and income we have the following estimates
If this house rents for $3,500 per month, it should sell for about 18 times annual rent which makes the price $756k
According to this web site the median household income in San Carlos is $103k
http://www.city-data.com/city/San-Carlos-California.html
If the median home (houses & condos) is valued at 5 times income and this house is nicer than the median home, assuming it is worth 7 times annual income, it’s price should be $721k
A drop in price by about 15% to 20% from 900k should make the price more reasonable.
May 4th, 2009 at 11:53 am
What else could explain the current $729k FHA limit in places Salinas or Watsonville?
Explanation: Salinas and Watsonville are probably in the San Jose-Sunnyvale-Santa Clara MSA. (I didn’t look it up to verify.)
May 4th, 2009 at 11:56 am
Never mind. I don’t know about Watsonville, but Salinas has its own MSA. I guess the FHA limits are based on history that might be out of date, and it’s definitely not based on what the prices should be.
May 4th, 2009 at 12:42 pm
Got a question for you burb experts.
My wife and I are looking into this:
http://www.thegrove-homes.com/
She loves the Valencia model and the fact it is a new home, we should be able to get the $18,000 tax credit for first-time buyers.
I’m not keen on the price especially because of where it is located. But, the attractive thing to me is that it should be an easy rental property in the future since Santa Clara U is right across the street.
I’d like to hear your opinions. Thanks!
May 4th, 2009 at 12:44 pm
Forgot to mention that there’s an HOA of $191 a month that only covers the exterior landscaping. Does not cover exterior of the house or home insurance. There’s also a pool and clubhouse.
The “yard” is ridiculously tiny.
May 4th, 2009 at 12:48 pm
Across SCU, does it mean where the caltrain, 880 and the airport flight path converge and become one?
May 4th, 2009 at 12:55 pm
Unfortunately, yes. Right next to some light industrial place and SCU’s baseball stadium.
Supposedly, the business next to it is selling the land and is currently “in-talks” with a developer. If it falls thriough, the city might put a park there. That is what the lady working there told us. No idea if it is true or not.
May 4th, 2009 at 1:01 pm
“I’ve never seen so many changes in a listing”
Oh, I can top that:
http://www.redfin.com/CA/San-Jose/6773-Moselle-Dr-95119/home/1490520
Mar 12, 2009 Price Changed $369,900 — MLSListings #80827865
Feb 24, 2009 Price Changed $380,900 — MLSListings #80827865
Feb 17, 2009 Price Changed $390,900 — MLSListings #80827865
Feb 07, 2009 Relisted — — MLSListings #80827865
Feb 07, 2009 Delisted — — MLSListings #80827865
Jan 27, 2009 Price Changed $400,900 — MLSListings #80827865
Jan 19, 2009 Price Changed $410,900 — MLSListings #80827865
Jan 12, 2009 Price Changed $415,900 — MLSListings #80827865
Dec 22, 2008 Price Changed $428,000 — MLSListings #80827865
Nov 29, 2008 Price Changed $446,000 — MLSListings #80827865
Nov 11, 2008 Price Changed $465,000 — MLSListings #80827865
Nov 09, 2008 Price Changed $528,000 — MLSListings #80827865
Oct 22, 2008 Price Changed $550,000 — MLSListings #80827865
Oct 18, 2008 Price Changed $575,000 — MLSListings #80827865
Oct 05, 2008 Price Changed $599,000 — MLSListings #80827865
Sep 21, 2008 Price Changed $625,000 — MLSListings #80827865
Sep 13, 2008 Price Changed $650,000 — MLSListings #80827865
Aug 27, 2008 Price Changed $675,000 — MLSListings #80827865
Aug 21, 2008 Price Changed $699,000 — MLSListings #80827865
Aug 17, 2008 Price Changed $725,000 — MLSListings #80827865
Aug 13, 2008 Listed $750,000 — MLSListings #80827865
May 4th, 2009 at 1:03 pm
The area badly need a real park, playgrounds and many more trees. I reside in Santa Clara and know first-hand that the city’s committed to long-term improvements, but you’re taking a chance bidding for a place where housing is generally cramped yet there are no parks or large grocery stores within sight. My humble opinion anyway. Mountain View’s condo developments compare favorably because they’re either sitting on the VTA path or on the Caltrain path.
May 4th, 2009 at 1:26 pm
Forgot to mention that there’s an HOA of $191 a month that only covers the exterior landscaping. Does not cover exterior of the house or home insurance. There’s also a pool and clubhouse.
Does it cover the pool & clubhouse then? $191/month is rather high if it’s only for landscaping. HOA fees should cover all of the public spaces (pool, clubhouse, exterior of home, insurance on the shell) unless it isn’t actually a condominium. You’ll have to ask what it covers – don’t assume. Also ask if it covers earthquake insurance for the structure.
May 4th, 2009 at 1:27 pm
If it isn’t a technically a condo, the HOA should still cover the pool & clubhouse because I can’t imagine they’d make them optional.
May 4th, 2009 at 1:43 pm
My humble opinion anyway. Mountain View’s condo developments compare favorably because they’re either sitting on the VTA path or on the Caltrain path.
We checked out Mountain View and my wife doesn’t like any of the floor plans. It is also more expensive.
Does it cover the pool & clubhouse then? $191/month is rather high if it’s only for landscaping.
Sorry, yes it does cover the pool and clubhouse. I did not check about earthquake insurance, but I will ask. I don’t think it will though.
This is a detached single family home, not a condo.
So, the Valencia floor plan is going for $709k. Personally, I think that’s still overpriced considering where it is. The address of the place is San Jose, not Santa Clara. And there is absolutely no land to it.
My wife fell in love with the house, so I’m in a kind in a bad situation. She’s been wanting to buy a house for the past 2 years and all the “housing prices have reached the bottom” bullocks on TV isn’t helping.
May 4th, 2009 at 2:22 pm
Better a less-than-ideal floorplan in a better location, if you’re going to commit to a house purchase. I do understand the lure of brand new, large interiors, esp. if you’re a young couple, but you also have to project yourself 5, 10 years in the future to evaluate if the compromise and the risky bet is worth it. Also, turnover may be higher than in typical SFR tracts, and it might be quite a while before all units are leased/sold. It may still suit your purpose, but personally I’d never buy there even for $500k.
May 4th, 2009 at 2:30 pm
$709K isn’t that bad compared to comps, but it’s not even in a real neighborhood. It’s a gated prison inside an industrial wasteland. At least the Rose Garden area has some charm and history.. this has graffiti and noise.
May 4th, 2009 at 2:33 pm
Be strong, I_love_SV, be strong. I mean, we can argue about what it’s worth (and I think it’s overpriced, but by how much exactly???), but a lot depends on what you can afford. And having a house you love is worth a lot, but what about a feeling of financial security? How will your debt load be with this house? How dependent on your job or not getting sick?
If you can afford it easily, than it’s a bit of a different question than if you are stretching.
Any way to rent one of these babies for a year or two and find out if you like living there?
May 4th, 2009 at 2:39 pm
#4, that blog post entry is great. There’s plenty of strong evidence the bubble is right at that 2nd peak, with a long way to fall.
The psychology is so powerful on pricing.
Driving through a super expensive East Bay neighborhood (94618 hills) yesterday – 90% of homes on many blocks rebuilt from foundation after the ’91 Oakland Hills fire, and they sure look nice. Most folks out there don’t think prices will drop – it’s too special!
May 4th, 2009 at 2:40 pm
Going by historical norms, 20% down on a $709k house would be $142k cash, leaving a loan balance of $567k. If you go by 4x income that puts the household income requirement at $142k/year.
With the FHA free money going around, along with $10k from the state and $8k from the USG, you would only need to bring $7k cash to the table to purchase this house, leaving a loan balance of $684k. At the 4x income level you would need to make at least $171k per year plus reserves.
In this kind of market you may want to cover your downside risk.
May 4th, 2009 at 3:21 pm
#9 – That makes me wonder how a home’s ideal price is influenced by a general downturn. I would expect a home to sell for less than its ideal price in a market like this simply because there’s more uncertainty and less demand.
Of course, that’s if everyone acted rationally. I’m sure that, even now, there are people snatching up houses at a price they think is a deal who will default on them relatively soon – which is precisely why people should not be allowed to take out overly-risky loans, especially with the economy in this state.
#21 – Gotta agree with that. Mass transit may be a bitch, but I’d rather space out on the train from San Carlos to SF than deal with 101 or 280 at rush hour.
Now excuse me while I fantasize about BART running all the way down the peninsula…
May 4th, 2009 at 3:38 pm
According to this web site the median household income in San Carlos is $103k
That strikes me as being low. From the looks of many of these cities, a lot of them have a skewed median income from the Pre-Prop 13ers.
May 4th, 2009 at 3:55 pm
32% of San Meteo County households make > $100k per year.
Wikipedia says $99k per household and $137k for families as of 2007.
May 4th, 2009 at 3:57 pm
Burbed,
Aggregate data can be misleading. There are certainly many renters downtown, and lower income folks living East of El Camino by the railroad tracks. Then you have the retired and elderly people.
May 4th, 2009 at 4:06 pm
The wiki data is from the census which estimates 76% owner occupied in San Carlos versus 54% in Redwood City, just one town south. So yes aggregate data makes a difference, but nearly as much in towns like San Carlos with such small percentage of renters.
May 4th, 2009 at 4:29 pm
Seems to me that the metric we’re looking for is “median income of recent buyers”. Them’s hard info to come across…but it sure could be useful!
May 4th, 2009 at 4:36 pm
From a November ’08 NAR report (dare we believe them?):
# The median income of first-time buyers is was $60,600. The typical first-time buyer purchased a home costing $165,000.
# The typical repeat buyer earned $88,200 and purchased a home costing $236,000.
U.S. census data puts median US household income at $50,233/yr.
Would it be fair to assume that recent bay area home buyers earn 20-40% more than the local median wage? Can anyone think of a way to test this assumption?
May 4th, 2009 at 4:37 pm
Ah, sorry, link to the aforementioned NAR report
http://www.marketingcharts.com/print/internet-realtors-most-popular-resources-for-home-buyers-6809/
May 4th, 2009 at 5:59 pm
Obtaining median incomes of recent home-buyers is less important than most people think. You can always estimate the income based on the type of loans buyers use. If most Peninsula buyers used 30-year fixed, fully documented loans and put down 20% they would likely have incomes high enough to support the area house prices.
But as we all know stated income, interest only and negative amortization mortgages were all too common implying that even relatively affluent buyers were stretching to afford homes.
One more indication that buyers were having trouble affording homes is the fact that sales volumes have dropped significantly in the more upscale areas in 2009. As stated income, interest only and negative amortization mortgages are no longer available there are fewer buyers who can “afford” homes.
May 4th, 2009 at 6:58 pm
Either the front of the house was built in the 1970s as an extension, or the listing is lying about the house being built in 1934.
May 4th, 2009 at 7:50 pm
Another $100K price cut for Classic Communities in Palo Alto.
This one has an interesting pricing strategy:
May 01, 2009 Price Changed $1,249,950 — MLSListings #80915707
Apr 28, 2009 Price Changed $1,299,950 – MLSListings #80915707
Apr 27, 2009 Price Changed $1,249,950 – MLSListings #80915707
Mar 28, 2009 Listed $1,299,950 – MLSListings #80915707
May 4th, 2009 at 10:28 pm
I_love_SV, as it happens I just researched “The Grove” after a conversation with a playgroup dad. It sounds like you already recognize that the immediate area has many problems. The area is light industrial, and the ballpark traffic and game noise is a concern.
The schools are just outside Santa Clara in San Jose. You get Trace Elementary (API 761), Hoover Middle (API 656) and Lincoln HS (API 723). That’s not good news, and even if you don’t have kids (or plan to have kids in the future) it will probably turn into a resale problem.
I’ll let the numbers folks tell you how many years till this is even potentially a breakeven rental (its definitely not now). That said, with just 2 car garage and limited (no?) street parking its not going to make a very good student rental.
If you can’t shake your wife off the that particular house right now consider the same house as “Magnolia” at Castilleja in Fremont. Its basically the same house from the same builder, but its cheaper and the schools are dramatically better (Warm Springs Elementary, API 936). You have to get over the East Bay stigma but on the numbers alone its probably a better deal. Still have the rail noise, but hey, at least its not next to the airport.
May 5th, 2009 at 3:16 am
Hey Joe in #4 post. Thank you for the link. It’s very insightful analysis and a good late-night snack.
May 6th, 2009 at 12:22 pm
I_love_SV,
I would not be completely discouraged by the comments in #36.
Don’t forget price is part of the equation. These are brand new homes with nice amenities that can be had for $500-$700K. If you work in Silicon Valley, the location is better than being on the East Bay.
If you have a kid that is about to enter kindergarden, then you might make a different decision, assuming private school is not an option.
May 6th, 2009 at 12:24 pm
DreamT Says:
Better a less-than-ideal floorplan in a better location, if you’re going to commit to a house purchase. I do understand the lure of brand new, large interiors, esp. if you’re a young couple, but you also have to project yourself 5, 10 years in the future to evaluate if the compromise and the risky bet is worth it.
I agree, but the areas we like are out of our price range (sub $700k) or the houses are just too rundown. We don’t want to be pouring money into the house.
May 6th, 2009 at 12:26 pm
sonarrat Says:
$709K isn’t that bad compared to comps, but it’s not even in a real neighborhood. It’s a gated prison inside an industrial wasteland. At least the Rose Garden area has some charm and history.. this has graffiti and noise.
Yeah, I’m really turned off by the industrial sites here. But, it seems like they are going away.
May 6th, 2009 at 12:30 pm
A. Lewis Says:
Be strong, I_love_SV, be strong. I mean, we can argue about what it’s worth (and I think it’s overpriced, but by how much exactly???), but a lot depends on what you can afford. And having a house you love is worth a lot, but what about a feeling of financial security? How will your debt load be with this house? How dependent on your job or not getting sick?
If you can afford it easily, than it’s a bit of a different question than if you are stretching.
Any way to rent one of these babies for a year or two and find out if you like living there?
My wife and are both working, so we can “afford” it. But, if one of us loses a job, then we’ll be in a tight crunch. We are currently renting now, but the wife is sick of renting.
Also, I’ve talked her out of buying this place (YAY!). And told her we should hold off a bit. We saw on the news last night that 1 in 4 homes in the southbay are underwater. This helped me a lot.
May 6th, 2009 at 12:31 pm
unearthly Says:
May 4th, 2009 at 2:40 pm
Going by historical norms, 20% down on a $709k house would be $142k cash, leaving a loan balance of $567k. If you go by 4x income that puts the household income requirement at $142k/year.
With the FHA free money going around, along with $10k from the state and $8k from the USG, you would only need to bring $7k cash to the table to purchase this house, leaving a loan balance of $684k. At the 4x income level you would need to make at least $171k per year plus reserves.
In this kind of market you may want to cover your downside risk.
May 6th, 2009 at 12:35 pm
Mistake above… Sorry.
unearthly Says:
Going by historical norms, 20% down on a $709k house would be $142k cash, leaving a loan balance of $567k. If you go by 4x income that puts the household income requirement at $142k/year.
In this kind of market you may want to cover your downside risk.
So would being in the situation above cover the downside risks? I’m new to all this house buying stuff.
May 6th, 2009 at 12:40 pm
Axxel Says:
I’ll let the numbers folks tell you how many years till this is even potentially a breakeven rental (its definitely not now). That said, with just 2 car garage and limited (no?) street parking its not going to make a very good student rental.
If you can’t shake your wife off the that particular house right now consider the same house as “Magnolia” at Castilleja in Fremont.
Actually, my friend lives in the development across (Pulte townhomes) the street and is renting it out to SCU students. His neighbors as well.
We went to Castilleja, liked the house, but hate the smell of the old Milpitas dump. Wife won’t consider it and it’s also a further commute for her.
May 6th, 2009 at 12:45 pm
Real Estater Says:
I would not be completely discouraged by the comments in #36.
Don’t forget price is part of the equation. These are brand new homes with nice amenities that can be had for $500-$700K. If you work in Silicon Valley, the location is better than being on the East Bay.
If you have a kid that is about to enter kindergarden, then you might make a different decision, assuming private school is not an option.
Yeah, I’m not too worried about the schools. No kids yet. We really want to stay in the Sunnyvale/Santa Clara area. 94086 is the furthest north we will go. And we don’t want to venture into San Jose if possible because she works in Palo Alto and hates the commute.
The Grove is close to the train station and she can take the train to work. But, since I’ve talked her out it, we’re going to sit back and watch the market for a few months. Or until she falls in love with another house.
May 6th, 2009 at 12:47 pm
“I agree, but the areas we like are out of our price range (sub $700k) or the houses are just too rundown. We don’t want to be pouring money into the house.”
You can get houses in very decent areas, good locations for $500k and pour $100k to fix it up. It’s a hassle, true, and there’s not the satisfaction or pride of moving in to something brand new (for which you actually pay a premium…) but esp. if you’re on a budget, it would make more sense financially both short term and long-term.
May 6th, 2009 at 12:50 pm
for that budget in the bay area, “falling in love with the house” as a criteria sounds like an awful strategy for a smart purchase and investment. IMO under $2M it’s best to keep the purchase strictly rational.
May 6th, 2009 at 12:52 pm
You can get houses in very decent areas, good locations for $500k and pour $100k to fix it up.
Any suggestions of neighborhoods? We only started recently to venture to Santa Clara. We love SV and never bothered to look any where else.
May 6th, 2009 at 12:54 pm
Good idea, DreamT, but I think it would be tough at the moment to buy a house and get a HELOC shortly after. Your plan works if they can do the renovations out of household cash flow, and if the neighborhood comps show another $100k investment in the house is worthwhile.
May 6th, 2009 at 12:54 pm
for that budget in the bay area, “falling in love with the house” as a criteria sounds like an awful strategy for a smart purchase and investment. IMO under $2M it’s best to keep the purchase strictly rational.
Since when did Woman+Home buying = rational? KIDDING!
May 6th, 2009 at 1:11 pm
I_love_SV – if you look for 3 bed, 2 bath, max $550k, city Santa Clara on mlslistings.com, you’ll be flooded with results. As far as Santa Clara goes, the area north of Pruneridge and south of Homestead has many decent neighborhoods – from Killarney Farms next to Lawrence all the way to St. Tomas. Prices can very a lot depending on the amount of remodeling and whether it’s on a relatively busy street (such as Pruneridge where a large house recently sold for $500k). For your price range you’d be centrally located in an established neighborhood with less turnover and underwater owners, but in an older house with little remodeling done, and on a street with pass-through traffic. There are lots of pieces to the equation obviously and compromises to be made, but the short of it is that for your price range you can get into Santa Clara proper in a decent neighborhood. Values there are more “sticky” on the way down than in new complexes – look at how prices suffered in Rivermark this past year compared to older SFRs in the south of Santa Clara.
May 6th, 2009 at 1:16 pm
As far as Santa Clara goes, the area north of Pruneridge and south of Homestead has many decent neighborhoods – from Killarney Farms next to Lawrence all the way to St. Tomas. Prices can very a lot depending on the amount of remodeling and whether it’s on a relatively busy street (such as Pruneridge where a large house recently sold for $500k).
Thanks! I will definitely check out the area.
May 6th, 2009 at 1:31 pm
DreamT says,
>>Values there are more “sticky” on the way down than in new complexes
I disagree with this point. New complexes are somewhat rare in Silicon Valley. You will not find many instances of people who own new complexes being in upside down situation. It is the run-down neighborhoods that plummted in value.
>>look at how prices suffered in Rivermark this past year compared to older SFRs in the south of Santa Clara.
Rivermark came out during the boom time. The “Grove” has already priced in the recession and selling at a much lower price point than Rivermark.
May 6th, 2009 at 1:35 pm
I_love_SV Says:
>>Yeah, I’m really turned off by the industrial sites here. But, it seems like they are going away.
Industrial sites are generally very quiet at night. You’re less likely to find drug activities or illegal business going on. There are both pros and cons about it.
May 6th, 2009 at 1:37 pm
All the new complexes I’ve seen recently built are either against an expressway, a freeway, behind a gas station, on a light industrial area, completely isolated from nearby neighborhoods, on a cleanup area, or a combination thereof. The main lure is that they’re brand new, which also comes with its baggage as I’ve pointed out.
Yes, run-down neighborhoods also lose a lot in value. Obviously nobody’s suggesting to buy in run-down neighborhoods. Duh.
I was pointing out the happy medium – older but decently-maintained neighborhoods, the areas where prices are stickiest.
May 6th, 2009 at 2:01 pm
“Rivermark came out during the boom time. The “Grove” has already priced in the recession and selling at a much lower price point than Rivermark.”
All of Santa Clara, or all of the SV for that matter, was priced for the boom during boom time, and has been pricing in the recession (which is already 16 months old). So price fluctuations are worthy of comparison.
May 6th, 2009 at 2:15 pm
Congratulations on talking the wife down from “we have to buy now!”. You shouldn’t feel too much pressure when you buy a home – I think you should feel like you found a place you really like, and you’re bidding an amount you feel OK about. Not panicky. Not doubting and worrying. It’s a huge purchase, after all.
Now what is this “$10k from the state” thing? I know about the $8k from the federal government, but I must not have been paying attention if there’s a CA program worth $10k.
Please send link and brief description.
May 6th, 2009 at 2:18 pm
I disagree with this point. New complexes are somewhat rare in Silicon Valley. You will not find many instances of people who own new complexes being in upside down situation. It is the run-down neighborhoods that plummted in value.
And I diagree with you. While you are correct that brand new (recently opened – post bubble – and still selling) complexes have the recession priced in, most importantly, they have the old-is-new-again lending rules requiring a down payment, documented income, etc. On the other hand, other neighborhoods that are “new” and sold during the boom would have a higher than average number of defaults because of the lending practices in effect when they were sold. Those would be the riskiest places to purchase now because more defaults could be on the near-term horizon. The proportion of these defaults will be higher because the units are sold as they are built during a fairly narrow timeframe.
May 6th, 2009 at 2:21 pm
58 – that’s exactly right. more defaults/foreclosures and more ‘forced’ turnover in newish places
May 6th, 2009 at 3:28 pm
Speaking of Rivermark, has anyone tracked prices there since the shooting and the Oracle-Sun deal?
I’m wondering how that has impacted prices.
May 6th, 2009 at 3:46 pm
#57
>>Now what is this “$10k from the state” thing?
CA pays you $10k you buy a new house.
good – no income limit
bad – its limited to first 10000 houses or CA files bankruptcy whichever happens first
May 7th, 2009 at 10:16 am
I looked at this house a while ago when it was listed for 988k. Turns out the property is owned by a realtor who is trying to bail out. Clearly, the realtor can’t even get the pricing on his own house right.
May 7th, 2009 at 10:40 am
A. Lewis Says:
Now what is this “$10k from the state” thing? I know about the $8k from the federal government, but I must not have been paying attention if there’s a CA program worth $10k.
Please send link and brief description.
The $10,000 tax credit is for home buyers that purchase a new home between March 1, 2009 and March 1, 2010. The bill set aside $100 million for the tax credit, so after 10,000 new homes are purchased, the credit is gone.
http://www.newhomessection.com/blog/10000-tax-credit-for-home-buyers-in-california/2009/02/21/
May 7th, 2009 at 10:46 am
All the new complexes I’ve seen recently built are either against an expressway, a freeway, behind a gas station, on a light industrial area, completely isolated from nearby neighborhoods, on a cleanup area, or a combination thereof. The main lure is that they’re brand new, which also comes with its baggage as I’ve pointed out.
I completely agree.
One new development I’m really interested in is Trinity Park in Sunnyvale. New SFRs in a nice neighborhood. But the price point is too high for me… I need to make more money…
May 7th, 2009 at 11:07 am
#62 – that realtor has other issues too apparently – the listing says “NOT A SHORT SALE” but the notes say it is a short sale and requires lender approval. WTF?
May 7th, 2009 at 11:14 am
nomadic,
| < and this is not a pipe
May 7th, 2009 at 11:15 am
reference link for the newcomers
May 7th, 2009 at 11:17 am
sigh… it always comes back to Magritte.
May 7th, 2009 at 11:38 am
Speaking of Rivermark, has anyone tracked prices there since the shooting and the Oracle-Sun deal?
—-
The shooting was a random incident, not a neighborhood issue. So I don’t think it is going to affect. Regarding Sun-Oracle deal it is too early to say. But very likely Oracle is going to keep that piece of real estate.
May 7th, 2009 at 8:02 pm
DreamT,
Obviously nobody’s suggesting to buy in run-down neighborhoods. Duh.
Uh………….
People would be shocked at the number of run down neighborhoods that have turned around in the past 20 years. Its not as easy as saying “just don’t buy in run down neighborhoods”. Some neighborhoods are run down because a bunch of old people live there. These are always a much lower demographic than the new people, and they die off. Other run down neighborhoods like rancho rinconada seem to never, ever improve. Parts of Campbell, that area behind Valley Fair shopping center, Barron park in Palo Alto, these were all run down areas once. Otoh Rancho Riconada was bad then and is bad now. Its all a case by case basis with real estate.
May 7th, 2009 at 8:10 pm
WG: I agree. Why isn’t EPA better? Makes no sense.
May 7th, 2009 at 8:47 pm
WG – My comment was actually intended for a first purchase of a primary home (that was the context of the post I was responding to). Your point is valid but IMO only for investment purchases. I would never advise a young or soon-to-be family to buy _and move in_ a run-down area if they have an alternative.
May 7th, 2009 at 10:44 pm
What holds back Rancho Rinconada? Simply bad karma?
May 7th, 2009 at 10:55 pm
burbed – The demographics there simply take longer to “die off”, to borrow WG’s expression. If only they could follow EPA’s sensible approach – drugs, murder, mayhem – Rancho Rinconada would improve to the point where it gets own Ikea.
PS. 2nd degree
May 7th, 2009 at 11:08 pm
does “2nd degree” refer to murder?
May 7th, 2009 at 11:28 pm
thong-in-cheeks
May 8th, 2009 at 10:36 am
Actually, there are a lot of new homes in Rancho Rinconada… Right next to incredibly run down homes with BMWs parked in front… My friend lives in the neighborhood.
The new homes were going for 1.2mil – 1.8mil in that crapper of a neighborhood late last year. Even those trailer park houses were going for 900K+… What a bargain!