September 29, 2012

Signs of the Times

Under Water around the Bay Area has been taken off SFGate.  This was an interactive feature that showed what percentage of each zip code’s homes had mortgages on them for more than they were worth.  While it was a great idea, the data hadn’t been updated in several years.  Thanks to Burbed reader JF for reporting the broken link; we’ve removed it from our collection.

120928-waverly-redfinMeanwhile, when Burbed readers send in listings to some neighborhoods, we can’t write them up fast enough.  This cute Palo Alto house sold for over $300K, or 23% over the asking price.  And the Redfin agent says it’s impossible to park nearby! 

With this crazy overbidding, can the $800,000 crapshacks of 2006 be far behind?  Is Burbed about to discover that what’s old is new again?  This is going to be GREAT!  We can rerun every single house from six years ago and nobody could tell the difference!

Tell us what you’re seeing at Open Houses, or about anything.  It’s Open Thread time!

Comments (15) -- Posted by: madhaus @ 5:04 am

15 Responses to “Signs of the Times”

  1. sunnyvalerenter Says:

    I reiterate my stand: This is not another housing bubble. The loan approval for jumbo loans is quite stringent and the people participating in these bidding wars are putting their money on the table. It is true that they obtained their money thru stocks, IPOs, speculation etc., but this is real strength in housing. NASDAQ falling or interest rates rising could arrest this trend, but let me warn you not to count on another housing bust.

  2. Mole Man Says:

    Housing prices are always inflated when interest rates are low. Wee bungalows are only worth more than a million if you really want to pay a million for them and then insure them for that.

    This particular house is adjacent to one of the nasty traffic vortices created by blocking some of the nearby streets. Drivers unfamiliar with the area end up getting frustrated and circling that park at high speed. Of course this is a small price to pay for enabling nearby owners along San Francisquito creek to live in relative peace.

  3. PK Says:

    #2 – That’s not quite a hard and fast rule. I’ve done some looking into it and we’ve lost a ton of pricing with ever lower interest rates since 2006. Also, you can take a look at Texas RE since the S&L crisis – pretty flat, even though they’ve gone through the same interest rate environments as, say, the RBA.

  4. madhaus Says:

    #3, Texas real estate stayed flat for two reasons. First, banks were not allowed to engage in no down/low down loans and other financial weapons of cash destruction. The real estate boom elsewhere (including the Bay Area) was fueled by NINJA loans where if you could fog a mirror, you could “own” a house. Or ten houses.

    The second reason is far more understandable. Texas real estate stayed flat because it was located in Texas.

  5. PK Says:

    #4 No argument there. The bugs are bigger and they have this thing called ‘humidity’. Don’t know what it is but it sounds bad!

  6. newPAhomeowner Says:

    This is a lovely home that was significantly under-priced to fuel a bidding war. IMO, the final sale price was reasonable.

  7. SEA Says:

    “I’ve done some looking into it and we’ve lost a ton of pricing with ever lower interest rates since 2006.”

    Did you considered the rate that interest rates go lower versus pricing?

  8. PK Says:

    #7 Check out graph #2 here. They both continued to fall post bubble-pop (this chart is country-wide).

  9. SEA Says:

    That’s not it.

    Did you considered the rate that interest rates go lower versus pricing?

  10. dollarbin Says:

    It’s certainly not a good time to be in the market for a single family home in Mountain View or Palo Alto right now. The open house on Dell Ave. was mobbed On Sunday I was working in my driveway when a woman came screeching up in her car asking “DO YOU KNOW WHERE THE OPEN HOUSE IS ON THIS STREET?” (not Dell). When I suggested Dell, she told me that she had just come from there and they basically told her to beat it by telling her there might be another house on the market near by. I have no idea what house they might have been talking about. As she prepared to drive off in a miasma of desperation, she looked up and said, “If you bought before this year, congratulations.”

  11. PK Says:

    Give me a few days – I’ll do change in rate YoY (using the January numbers – since that’s where I got the pricing data) vs. pricing, and I’ll do change in rate YoY vs. change in price YoY.

  12. SEA Says:

    I’m looking forward to it!

  13. PK Says:

    Okay, 1.5 days. I guess that count as a few.

    I don’t think we’ve got enough data, and my issue is I can only find mortgage rates as far back as 1975. Still, you can see that the relationship has come unhinged twice since that date – 70s and post-bubble pop.

    If someone can find a good mortgage rate going back further than the 70s that would be good – we could compare it to the huge Shiller dataset (back to 1890!).

  14. SEA Says:

    PK- Now I’m going to take a few days for a proper reply, and that’s probably more than 1.5. 🙂

  15. PK Says:

    Haha if it’s really long let me know and I can toss it up on my site?

    And if you can find some reliable mortgage rates going further back definitely share!

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