The importance of a comma
Let’s give a warm welcome to longtime Burbed reader sonarrat, Burbed’s newest regular blogger!
Please, save your rotten tomatoes and rioting until the end. To celebrate the interment, er, I mean introduction of our new contributor, let’s make a day trip to beautiful scenic Santa Cruz.
1165 Thompson Ave, Santa Cruz, CA 95062
$309,500
Beds: 3
Baths: 1
Sq. Ft.: 1,317
$/Sq. Ft.: $235
Lot Size: 0.34 Acres
Property Type: Detached Single Family
Style: Traditional
Stories: 1
View: Neighborhood
Year Built: 1948
Community: Live Oak
County: Santa Cruz
MLS#: 81056459
Source: MLSListings
Status: Active
On Redfin: 114 daysNon-Conforming Residential located on a parcel zoned M-1 Light Industrial. This property is located directly across from the ProBuild Door & Window Design Company. This property is eligible under the Freddie Mac First Look Initiative through 12.15.2010. Seller is offering a 2 year home warranty limitations, do apply ask for details.
Lionel Hutz: All right, gentlemen, I’ll take your case, but I’m going to have to ask for a thousand-dollar retainer.
Bart: A thousand dollars? But your ad says “No money down”.
Lionel Hutz: Oh, they got this all screwed up… (scribbles) “Works on contingency basis? No, money down!”
Bart: So, you don’t work on a contingency basis?
Lionel Hutz: No, money down! Oops, it shouldn’t have this Bar Association logo here either.
A comma can be a powerful thing. Let’s ignore the home warranty limitations for now, though, and focus on the property. We have some of the Burbed standbys: the low-maintenance lawn, garage pre-boarded for the next tsunami, and your very own dumpster, which has the added effect of harboring wildlife! This is truly the perfect house for Santa Cruz’ tender-hearted liberal sensibilities. You also have the possibility of using the house as a workshop, seeing how it has M-1 zoning. And look at the instant equity!
The last sale was for $425,000, before The Bubble even began. Clearly, then, that must be the baseline, because there could never have been any real estate bubble in California before The Bubble. No, The Bubble was a one-off that has never happened before and will never happen again!
March 29th, 2011 at 8:19 am
Zoned Light Industrial… So it’s perfectly fine to put your seven cars up on blocks in the yard?
And the instant equity keeps going up:
Mar 28, 2011 Price Changed $289,900
March 29th, 2011 at 9:03 am
Sooner or later it’s going to get cheap enough that one of the warehouses or businesses nearby is going to buy it just for overflow parking. I don’t see anybody buying it to live in.
March 29th, 2011 at 9:28 am
Welcome, newest Burbed guest editor! Now all you need is the Mig fighter jet!
Hey, for a crapbox zoned Light Industrial, it was awfully optimistic of the Realtard to take pictures inside. Most wouldn’t bother.
March 29th, 2011 at 10:37 am
Shouldn’t this be listed as steps from the beach?
March 29th, 2011 at 11:13 am
The bubble was already inflating in 2000, I’d go back to 97-98 for the start of this bubble.
March 29th, 2011 at 11:45 am
That’s probably reasonable… The bubble first started from money runoff from the dot-com era. When the dot-com bubble subsided, the housing bubble began to run full speed.
Without bubble prices, we would really be at 90s prices. That’s right – absolutely no appreciation from the 90s. I do hope homebeggars enjoy paying taxes and maintenance and the lack of mobility that comes with homedebtorship. Oh, and lining the pockets of your local
high school dropoutrealtor must be pretty satisfying too. So must be paying to educate other people’s kids.Even if property values stay the same, these things will nickel and dime owner, ensuring that it costs more to own than it does to rent (as has been the case for the past 100 years).
March 29th, 2011 at 11:47 am
Oh, and when you factor in that the dollar is now worth roughly half of what it was in the mid 90s, one can see quite clearly how terrible a deal housing is for the consumer.
March 29th, 2011 at 7:01 pm
#4, how many steps? Depending on your definition of “steps,” my apartment in San Jose is “steps from the beach” too.
March 29th, 2011 at 7:22 pm
Well, something like 666 was sufficient for the post I linked to. So how about 1666 steps? On the map it didn’t look like more than maybe a 10 minute walk, so it could be farther than that if you don’t take really big steps.
March 29th, 2011 at 8:35 pm
Even if property values stay the same, these things will nickel and dime owner, ensuring that it costs more to own than it does to rent (as has been the case for the past 100 years).
If property values stay the same then overall values would still erode via the effects of inflation over time. I’m sure everyone heard the report that home prices were down in all 20 major metros except DC. So values haven’t stopped falling yet. The list includes SF, SD, LA, NY… basically your run of the mill bubble cities.
Another interesting development that could have an effect on home prices is a piece of legislation being proposed that would basically require home buyers to put down anywhere from 15-20% on a home. This would probably affect prices simply because the bar would be raised in order to get into a home. Thus if everyone suddenly has to cough up $100,000 for a starter home in the Bay Area and other expensive metros then that have an affect on sales. Personally I think its a great idea.
March 29th, 2011 at 8:50 pm
not sure where you get your news, bob, but this says that San Diego was up:
http://www.latimes.com/business/realestate/la-fi-home-prices-20110330,0,3483810.story
“San Diego was up 0.1% and Washington rose 3.6%.”
Hopefully not from CNN. Observe this gem from yesterday, both articles from CNN:
Never been so few vacant houses! See the first graph and the quote below:
http://finance.fortune.cnn.com/2011/03/28/real-estate-its-time-to-buy-again/
“In the 41 cities Metrostudy covers, a total of 78,000 houses are now either vacant and for sale, or under construction. That’s less than one-fourth of the 343,000 units in those two categories at the peak of the frenzy in mid-2006, and well below the level of a decade ago. “
But, no! There’s never been so many vacant houses!
http://money.cnn.com/2011/03/28/real_estate/us_housing_vacancy_rates/
“High residential vacancies are killing many housing markets (…) And it’s only getting worse: The national vacancy rate crept up to just over 13%”
March 29th, 2011 at 9:06 pm
Legislating a down payment sounds idiotic. I agree with the principle, but not having the government involved. Nothing like closing the barn door after the horses have all escaped.
March 29th, 2011 at 9:13 pm
The government should be free to legislate down payments for loans it insures. Beyond that, it would better serve the people by making sure the derivatives industry is properly regulated.
March 29th, 2011 at 9:19 pm
#13, I agree. However, I’d also argue that the government should have a very small role insuring loans. The muddled private/not-private status of Fannie and Freddie is a cluster****.
March 29th, 2011 at 9:27 pm
The government’s share of the pie should be lower, certainly, than it is now. With the feds writing trillions (right?) in mortgages at extremely low interest rates, I just hope they don’t eventually try to offload their existing portfolio into the private sector. They would lose a whole new boatload of money as investors demand a premium for taking on the risk.
March 29th, 2011 at 9:29 pm
You know the deal: Privatize the gains; socialize the losses…
March 29th, 2011 at 9:37 pm
Bob,
You’re truly clueless. The area where you work is in a major bull market right now. Who cares about the other places where you can’t even find a job to move to.
Standard down payment is already at 25% to get a jumbo-conforming loan, which is commonplace in the Bay Area. I put 40% down on all of my homes. You’re saying you can’t cough up $100K? If you can, I can assure you plenty of other people can as well. if you check around most people make more than that in a year.
March 29th, 2011 at 9:48 pm
Yeah. And then taxes take a third and people spend the rest.
Good lord. With 20% down think of the hilarity that would ensue. What would a 20% down requirement do to would house prices? Heh heh
March 29th, 2011 at 9:56 pm
>>What would a 20% down requirement do to would house prices? Heh heh
BAU (Business as usual) in the RBA.
March 29th, 2011 at 10:15 pm
I don’t think so.
March 29th, 2011 at 10:36 pm
Yea, 20% down might be business as usual in the RBA, but the RBA keeps getting smaller…
Doesn’t every RBA property come with a free Petite Lap Giraffe? That’s worth the 20% down!
March 29th, 2011 at 11:06 pm
God, what a POS. Santa Cruz thinks it’s SO precious. Actually it’s a bunch of SUV-driving yahoos and old hippies, and a liberal helping of homeless from all over – for the free weed, dude! Want to have a helpful hobo describe to you in detail how to inject Vicodin? Go to Santa Cruz! Want to buy a glorified trailer full of rats? Go to Santa Cruz!
March 30th, 2011 at 5:18 pm
Bob,
You’re truly clueless. The area where you work is in a major bull market right now. Who cares about the other places where you can’t even find a job to move to.
Latest reports show that YOY, Santa Clara county is down -5.4%, San Francisco is -6.1%, San Mateo -6.8%, and Alameda co. down -6.4%. So in other words values are down overall across the region. That’s hardly what I would call a “bull market”.
What are you talking about? specific streets or blocks?
March 30th, 2011 at 8:14 pm
Useless aggregate data. In those stats, Antioch and Vallejo are considered part of San Francisco. Santa Clara County includes Gilroy.
I’m talking about RBA, where professionals live.
March 30th, 2011 at 9:48 pm
Oh- and so let me guess- there aren’t any professionals living in any of the extremely limited areas that I assume are considered the RBA? Last time I looked at the definition of “professional”, it means one who basically has a degree and works in a white collar job. Are people in the east bay strictly high school diploma earners while somewhere there’s an invisible line where only college grads live- and they only live in a few corners of a large metro area? Hogwash.
For starters, the RBA thing is a long-running joke on this site. Its not meant to be used as excuse for the reality that overall real estate is in the crapper throughout the entire Bay Area. Sure- I have no doubt that there are some people chunking out cash for overpriced rancher houses in one of the many somewhat boring suburbs of the Peninsula. They are in a small minority and frankly I could care less.
March 30th, 2011 at 10:58 pm
meaning, of course, that you do care because if you could care less then you must care some.
bob, why do you care some non zero amount about this phenomenon of people chunking out change for overpriced ranch houses?
March 31st, 2011 at 12:14 pm
#13, the proposed legislation IS only for government backed loans. Private-label mortgages are not constrained in any way. So I think your criteria are met, and it’s a good idea – if the taxpayer’s money is involved, let’s keep things safe, sane, and regulated. Private parties can negotiate whatever they want at free market rates and prices.
For a good breakdown, including the ridiculous complaints from the industry, read this:
http://www.calculatedriskblog.com/2011/03/lawler-shrill-cry-from-lobbyists-on-qrm.html