December 3, 2011

Bay Area Prestige Home Index: Up from a Real Downer

If you’re interested in Bay Area real estate, you should be familiar with the Prestige Home Index.  Put together by First Republic Bank, the Prestige Home Index tracks the value of a number of “over $1 million properties” in eight Bay Area counties.  Burbed has a handy link to the index on our blogroll on the right; you’ll find it with the Real Bay Area links.

Earlier this week, the latest quarterly numbers ending September 30th were released.  Let’s take a look at First Republic’s exciting graph with the latest RBA domicile data!

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While the index has risen to 437.48 (after dropping from 450 nine months ago, long down from its peak of 533.17 exactly four years ago) the little kick at the very end of the graph shows what could be the second dead cat bounce, or it could show we’ve hit bottom!  Then again, it could just represent a few LinkedIn types jumping into Palo Alto ahead of their stock coming out of the no-trading lock-up zone.

Then again, the above graph is the median value of their high-end home portfolio, which is currently $2,531,042.  Since they neglected to graph the index itself, I’ve thrown one together for you.

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Oh, silly me, I didn’t pull the “let’s exaggerate the graph by chopping a whole bunch of numbers off the bottom of the Y axis” trick.  Fine, I can play that game too.

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Can anyone figure out which Bay Area county is not represented in the First Republic Prestige Home Index, San Francisco Edition?  My money is on Marin!

In San Francisco, the higher end of the luxury market was active. “Above $5 million, the market is healthy,” said Mary Lou Castellanos of Sotheby’s International Realty. “Smart money is buying now and is taking advantage of lower prices and lower interest rates. At the same time, a growing number of sellers are getting more realistic about price.”

We’ve featured high-end properties before, and prices aren’t always realistic (take a look at both the homes in the zip code series and this collection of Santa Clara County astonishers if you don’t believe us).

This is an Open Thread.

Comments (23) -- Posted by: madhaus @ 5:09 am

23 Responses to “Bay Area Prestige Home Index: Up from a Real Downer”

  1. SEA Says:

    The part about starting the y-axis at 100 is fine, but it really needs a log axis, so the distance between 1 and 2 is the same as between 2 and 4. That way we could clearly view the ‘automatic price doubles,’ no matter the starting price.

  2. SEA Says:

    “Smart money is buying now and is taking advantage of lower prices and lower interest rates. At the same time, a growing number of sellers are getting more realistic about price.”

    “Smart money?” “lower interest rates?”

    Even at negative two percent we have seen many bad deals.

    Also change the last word in #1 to time. …no matter the starting time.

  3. PKamp3 Says:

    You should also pinch the x axis so that the rapid rise seems more extreme. This graph is still too honest!

  4. ms Says:

    Why Marin?
    Maybe Solano..

  5. madhaus Says:

    sarchasm – the yawning gulf between a comment made by a flippant speaker, and the listener who didn’t get it.

  6. ms Says:

    Well, you were the one who put that Blair Witch House in Marin on here.

  7. Mole Man Says:

    This is how it always happens. The initial downturn is really scary and gets attention. Then the market sort of recovers, then sort of slumps down again. That keeps repeating while the average market level hardly moves at all. Keep that up for a few years while inflation works its magic and POOF! All that troublesome equity GONE! I mean debt. No, wait …

  8. SEA Says:

    #6- Take a look at this, and read this thread again.

  9. SEA Says:

    The northern part of the RBA is back:

    “Feds: Seattle welfare recipient lives in million dollar home”

    “A federal official spoke to KING 5 News on condition of anonymity. He says the housing voucher program provides coupons that help low-income people pay their rent. He says it allows people to get out of housing projects and move into the place of their choosing. However, he says a “flaw” is that the program doesn’t analyze where people are living, even if it is at a ritzy address that should raise a red flag.”

    Remember: Income does not matter.

  10. nomadic Says:

    What are you really trying to say, SEA? It pays to be a rentard?
    ;-)

  11. ms Says:

    SEA, at first it seemed you meant Antioch…

  12. SEA Says:

    #11- Prof. Bleen said it best:

    HERE

    Be sure and read the whole post, but pay particular attention to, “In the heady early-bubble days, the RBA may have extended as far north as Seattle.”

  13. ms Says:

    SEA,
    I am starting to read your thread above.
    The 2008 starting date makes me think it won’t end well…but will be back after the break

  14. ms Says:

    SEA,
    Now I see.
    In the last couple tiers of RBA as most recently defined, a house worth $1.1 at the time of that writing could still go for $900K now.
    Section 8 vouchers don’t pay for a house like that, but they do in Antioch (Tracy, too).
    Here are people getting pissed off:
    http://forums.contracostatimes.com/topic/no-more-section-8-in-antioch

  15. SEA Says:

    #14- Technical correction:

    “In the last couple tiers of RBA as most recently defined, a house worth $1.1 at the time of that writing could still go for $900K now.”

    The RBA only goes up in value: “Uniformly appreciating.”

    If a $1.1M home is now selling for $900k, that home is not in the RBA. One may have thought it to be in the RBA when it sold for $1.1M, but that was the devil in disguise.

  16. SEA Says:

    #14- Also that link just provided some comic relief. All seem to make the basic claim “we are better than section 8 housing.” I suspect if they were of RBA quality, then they wouldn’t be posting on that forum.

    “antioch needs to post street signs – (i.e.) you are entering a section 8 housing zone – this will alert good citizens to take an alternate route”

    All the ills in the Antioch seem to fall on the unfavorable Section 8 recipients. What do we need, a Final Solution for undesirables?

    arbeit macht frei

  17. nomadic Says:

    #16, we should turn them into tasty snacks!

  18. Greg Fielding Says:

    Brilliant find madhaus. I wish it showed a volume overlay.

  19. madhaus Says:

    I don’t see how it could, Greg. It’s a portfolio of actual houses, not Meaningless Aggregate Data. Sort of a mini Case-Shiller. I didn’t get the impression it was all the houses valued over a mil as of a certain date, either.

    It doesn’t say how many homes are in the mix, either.

  20. ms Says:

    15) Ah, –>that<– RBA, where the deer and the antelope play, and get hit on 280.
    In the antioch thread, you do have the feeling that if Sec 8 renters moved in and just went to work like normal, no one would ever know. It's the general increase in mayhem that made people angry.

  21. Petsmart groomer Says:

    > Section 8 vouchers don’t pay for a house like that

    Of course they do.

  22. ms Says:

    21) This needs to be a crime, not a tort. I hope they take these losers’ children away to keep them from being further corrupted.

  23. SEA Says:

    “SACRAMENTO, Calif. (AP) — A California prison psychologist is charged with faking her own rape in an unsuccessful bid to persuade her husband to move to a safer neighborhood.”

    My guess: She wanted to move to the RBA.


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