February 10, 2013

Another Wave of the Bubble Wand: A $6.5M Crapbox in Palo Alto

130209-webster-bubblewandYesterday we had a brief summary of snapshots showing that we are indeed entering the early stages of a new real estate bubble.  Far-flung areas are still far below their ridiculous 2005-6 peak pricing, and nearby but unloved neighborhoods are being scraped up by investors rather than the outbid mortgage mooches.

But core Real Bay Area listings near high-paying tech jobs are at or even above their insane 2008 peak pricing.  Yes, 2008.  Crap areas hit their high-water marks much earlier than premium places, and it’s the high end that has come back first and letting us know it.  We promised we had a doozy for you today, and we weren’t kidding.  Thanks very much to Burbed reader Wendie for bringing by the bubbly by the carboy.

Location, Location, Location! Teardown: $6.5 Million

Need proof that the Palo Alto housing market has heated up?

130902-webster-patchBy Beatrice Karnes; February 8, 2013

It’s not enough to live in Palo Alto—homebuyers want to live in specific neighborhoods. A home in Old Palo Alto has gone on the market and it’s being advertised as a tear-down or a remodel. Asking price: $6.5 million.

It’s a simple, middle class home built in the mid-1930s and boasts four bedrooms, 3.5 bathrooms, hardwood floors, some linoleum or vinyl floors, and a one car garage.

Let’s have a look.

120209-webster-mlsl1935 WEBSTER ST
Palo Alto, CA 94301
$6,500,000

Active
Type: Single Family Home
MLS #: ML81303410
SqFt: 3,009130209-webster-front
Beds: 4
Lot Size: 16,610 SqFt
Baths: 3 Full / 1 Partial
Year / Age: 1937 / 76

Virtual Tour

Prestigious Old Palo Alto location. Rare opportunity to remodel or build new on a large lot. Possible subdivision, Buyer to verify with City of Palo Alto. Built in 1935 by William Wurster. Detached recreation room with workshop, dark room and half bath.

130209-webster-tulipsLet us count the ways that this is Dutch Tulip Fever all over again:

  • A teardown, for Six. Point. Five. Million. Dollars.
  • A teardown, but you could remodel. After spending Six. Point. Five. Million. Dollars.
  • A teardown, 78 years old (2 years too young for the “old house” tag)
  • A teardown, with a named architect.
  • A teardown, sold for its potential to build two houses. But why stop there, bribe the appropriate agencies and cram in four!  Heck, how about a 20 story condo tower? Buyer to verify with City of Palo Alto.
  • A teardown, with 22, yes twenty-two mostly similar photos in full HDR.  Have you ever seen HDR photos of a workshop, a basement, or a garden hose left on the ground?  You’re about to.

130209-webster-workroom130209-webster-huh130209-webster-hose130209-webster-carport

Do not miss this Rare opportunity to be able to Walk To Steve Jobs’ House.

Comments (21) -- Posted by: madhaus @ 5:07 am






February 9, 2013

More Bubblicious Signs of Bubbling Bubblicity

Sometimes, there’s a message out there with your name on it, so you get hit on the head with it again and again and again.  Here are some of the messages we got yesterday, and they all add up to the same thing.

130208-bubble-foreclosureFirst, looks like HELOCs are coming back.  No, they’re not at the insane rate of the glory days of 2006, but there’s more in 2012 than 2011.  So that’s something for us to keep an eye on. 

One of the problems with HELOCs was HELOCity, where every homedebtor used the line of credit not for major home improvements or emergencies, but as a full-time ATM.  People bought a lot of giant-ass SUVs and vacations and bling using the equity in their homes.  Why would they do something that stupid? Do they really think they’d never have to pay it back?  Some of us actually do remember when second mortgages were subprime mortgages throughout the industry.

Speaking of subprime, you know what else is back? Subprime mortgages! That article we featured last weekend on the Dignity Mortgage wasn’t the only sip of subprime sangria.  Gotta love this quote:

The Revival of Subprime: Will This End Badly?

By Matt Clinch | CNBC – February 8, 2013

The sub-prime market – risky mortgage backed securities – is hot again and its revival is exceeding many people’s expectations, the chief market strategist at Rosenblatt Securities says. He believes this will end badly.

The subprime mortgage crisis which led to the financial crash of 2008 involved institutions making loans to those that had difficulty maintaining their repayment schedule.

Wall Street brokerage firm Rosenblatt – which has been monitoring the situation since the last storm – says the credit-led bull market is well under way.

"The subprime market’s revival is proving to be even stronger than we had anticipated," Brian Reynolds said in a research note. "This is just a credit cycle, and it will eventually end badly like the others."

We are sure you are thinking the same thing we are: How can we best profit from so many other people’s stupidity?

130208-bubble-pamaiNext, several different reports of an increasingly skewed seller’s market.  We’ll have one up bright and early to start the week, and it’s a doozy.  Here’s a smaller example, an on-the-ground report from Definitely Not the Real Bay Area.  This poor agent says she listed a Blossom Valley property and now her phone is ringing every ten minutes.  Won’t someone let her get some quiet time and please offer twice the asking price already? 

130208-bubble-downpaymentBuyers now have to write beg letters to get noticed when there’s 40 offers on the table. And who can forget the lottery line for just 4 Gale Ranch models in San Ramon.  Need we remind you, Gale Ranch is not only in the East Bay, it’s in a place where they are still making more land. 

If you haven’t already seen this 2007 (!!!) video, enjoy it.  And if you have, sing along, because HERE COMES ANOTHER BUBBLE.

Comments (32) -- Posted by: madhaus @ 5:05 am

February 8, 2013

A very not-RBA listing in an almost-RBA town

Burbed just doesn’t give the East Bay enough love, so we’re always delighted when our readers send us something from Alameda or Contra Costa County.  Today’s featured listing is from one of the more rarified regions of CCC, but you’ll see that there’s nothing Real about this Bay Area bonanza.  Thanks very much to Burbed reader Kim in the East Bay for this Danville domicile!

130207-lagonda-redfin898 La Gonda Way
Danville, CA 94526
$619,500

3 Beds
1 Baths
1,112 Sq. Ft.
$557 / Sq. Ft.
Built: 1953
Lot Size: —
On Redfin: 67 days
Status: Active
Property Type: Single-Family Home
County: Contra Costa
Community: Danville/San Ramon |
MLS#: 403322

Single family home on large level lot with 3 bedrooms, 1 bathroom, living room with fireplace, dining area, large kitchen, huge yard, 2 car garage parking.

 

130207-lagonda-kitchenAre we lost? This looks like something not from Danville, but maybe Connecticut.  Bricks, autumn foliage, and what could pass for aluminum siding; all we need are some shooting ranges in those woods over the back fence.  And that spare prose is pure Yankee, other than the outburst about the huge yard.  So huge the lot size isn’t even provided (9583 sf, even that’s more East Coast than East Bay).

Maybe we’re not lost but this house is. The price has been reduced twice, and the agent couldn’t be bothered to clean up before taking the listing pix.  Even the dog carrier stays.

130207-lagonda-satellite

Did we mention location, location, location?

Comments (38) -- Posted by: madhaus @ 5:05 am

February 7, 2013

Quintessential Real Estate Photography in Cambrian is ADORABLE

Like photos? So do we!  And this pimped-out property has powerful pix!  Thanks very much to Burbed reader Tracy Tea House for finding us this Cambrian casa. It may not have “Honey, stop the car!” curb appeal or “Can I hire your decorator” staging, but for all we know this listing was photographed by Herb Ritts.

130206-park-trulia5639 Park Manor Dr
San Jose, CA 95118
$645,000

  • MLS/Source ID: 81301959
  • 4 Bedrooms
  • 2 Bathrooms
  • 1,486 sqft
  • Single-Family Home
  • Lot Size: 6,098 sqft
  • Neighborhood: Cambrian
  • 14 Days on Trulia
  • 289 views

5639 Park Manor Dr ADORABLE 4BEDROOM/2BATH HOME WITH GUADALUPE ELEMENTARY SCHOOL! Refinished hardwood floors* all new interior paint including the kitchen cabinets & hall vanity* new faucets, mirrors, light bars, vinyl floor & baseboards in master & hall bath* new vanity in master bath* new family room carpet* all new satin nickel interior doorknobs* new dishwasher & faucet* nice play structure* & NEW ROOF.

Tracy says this listing is OMG.  If a picture is worth a thousand words, then it’s definitely tl;dr. 

130206-park-dining130206-park-kitchen130206-park-living130206-park-window-wtf130206-park-yard130206-park-power

Bunus: Super-ultra-extra redundant power lines!  Lots of them, so convenient!

130206-park-satellite

Comments (9) -- Posted by: madhaus @ 5:09 am

February 6, 2013

What’s Special and Vintage and Oh So Cute and only costs $350,000?

So many times we hear the refrain, “I would love to buy a house, but I can’t afford anything.  It’s just too expensive here.” And so many times we have found affordable houses that YOU could go and buy.  Today we have yet another exciting opportunity for YOU, the would-be homeowner.  Just imagine yourself watering your very own lawn!  Or even better, your very own Rose Garden!

130205-forest-redfin1951 FOREST Ave
San Jose, CA 95128
$350,000

1 Beds
1 Baths
525 Sq. Ft.
$667 / Sq. Ft.
Built: 1915
Lot Size: 3,600 Sq. Ft.
On Redfin: 70 days
Status: Active
Property Type: Detached Single Family
Community: Central San Jose
MLS#: 81241926

This home is located in the desirable Rose Garden neighborhood. Needs a lot of work. Not livable now. Contractor’s special. Located on a 3,600 square foot lot. Has a lot of potential. Great opportunity for someone looking to move into a fantastic area.

130205-forest-satellite

This property is Special for a number of reasons, and we don’t just mean for Contractors.

That’s a Streetview shot on this property listing.  The realtard didn’t even bother cropping it a little to strip out the Google logo.  It also, LUCKY YOU, conveniently fell out of contract just a couple of weeks ago, and is relisted at the same attractive price. 

Speaking of attractive, let’s swing that Streetview camera just a little to the right (below).  While the white truck is intriguing, the station wagon is vehicular WIN.  And from the satellite shot on the left, we can see exactly why this is such an attractive proposition: this looks like a Hoarder House.  Can you imagine what sorts of “bunus” loot awaits the lucky buyer of this affordable home that wears its 98 years proudly?

130205-forest-streetview

Bunus Specialtude: This home has been featured as the cover photo of our brand new Facebook Page for a couple of days.  Keep checking over there for new cover photos, and play “Find That Crapbox!”

Comments (11) -- Posted by: madhaus @ 5:07 am

February 5, 2013

Contemporary Home/High Tech HQ/Auto Showroom/Cultural Center/MLM Offices

Today’s building is not only in soooo prestigious Woodside (home of the record-breaking $117.5 million property sale), it’s got a look that makes it so much more than merely a trophy home.  Plus it’s just steps away from cosmopolitan Redwood City!  Thanks very much to Burbed reader Petsmart Groomer for this superb structure.

130204-cinnabar-redfin240 CINNABAR Rd
Woodside, CA 94062
$14,800,000

4 Beds
5 Baths
8,669 Sq. Ft.
$1,707 / Sq. Ft.
Built: 1991
Lot Size: 3.01 Acres
On Redfin: 131 days
Status: Active
Property Type: Detached Single Family
Stories: 3
Community: Woodside Hills
MLS#: 81235457
Style: Contemporary
View: Bay, City Lights
County: San Mateo

MODERN HIGH-TECH HOME ON 3+ PRIVATE ACRES WITH SWEEPING 130204-cinnabar-groundsVIEWS OF SF BAY, EAST BAY HILLS & STANFORD. 2-STORY LR W/ WALLS OF GLASS ORIENTED TOWARD THE VIEW; FLOATING STAIRCASE, FULLY CUSTOMIZED LIBRARY AND OFFICE; 4 BED PLUS 2 MULTI-ROOM APTS; ELEVATOR; 21 KW SOLAR SYSTEM, UNDERGROUND GARAGE; 12′ CEILINGS IN BASEMENT; GROUNDS W/ INFINITY POOL, SPA, TERRACES, PLAYGROUND, PUTTING GREEN, FIREPIT

12’ CEILINGS IN BASEMENT? Unless there’s a squash court in there, why would you need the basement floors so deep?  Was this a former mausoleum but they’re just not copping to it?

And have a good look at the aerial shot: as PG so aptly notes, all those smaller lots are Redwood City in your backyard.  Don’t worry, despite bordering your property, they can’t get to your street.

130204-cinnabar-satellite

It’s the FLOATING STAIRCASE that scares them away.

Comments (4) -- Posted by: madhaus @ 5:09 am

February 4, 2013

Today in Portola Valley: Guest Blogger on Guest House

burbed_guest_bloggerWe haven’t had a guest post for a while, so we’re going to sleep in while Burbed reader Dr. Jim takes over today’s column.  Thanks very much!  Please give Dr. Jim a big, warm, Real Bay Area welcome to the front page as today’s guest blogger!

And now we’re going back to bed.


130203-portola-redfin451 PORTOLA Rd
Portola Valley, CA 94028
$6,495,000

4 Beds
5 Baths
4,200 Sq. Ft.
$1,546 / Sq. Ft.
Built: 1912
Lot Size: 1.13 Acres
On Redfin: 88 days
Status: Active
Property Type: Detached Single Family
Stories: Tri-Level
Community: Brookside/Willowbrook Area
MLS#: 81240340

Stunning historic estate originally built by Herbert E. Law completely renovated with state of the art contemporary finishes. Turreted castle main residence (3 br) incl. 1000 sq. ft new construction, stone guest cottage, 1200 sq. ft workshop. 1.2 flat ac. in prime PV, western views, pool, bocce court, enclosed rose garden, diamond plaster top quality appliances incl. La Cornue stove, Miele appl.

130203-portola-gatehouseCheck it out: 

They expect to make $4,645,000 profit on a house that they bought 1.5 years ago for $1,850,000!  That’s $1106/sf for remodeling.  And the cottage and workshop were there already.  Granted, the land is valuable, but that’s already accounted for in the original purchase price.  Let’s say they spent a ridiculous million dollars on renovation.  That’s still a 28% ROI, which is wildly ambitious.

130203-portola-ladderA couple of notes on the listing copy: (1) This is not the Herbert E. Law estate, this is the former GATEHOUSE for the Law estate (Villa Lauriston).  (2) A La Cornue oven, oh boy!  It looks like the $35,000 model (Chateau 120).  If they had put in a $299 Kenmore range, I suppose they would be asking $6,460,299.  Not really much difference.

Thank goodness for the Internet.  Just a few years ago, prior sale info was more difficult to obtain.  I think part of the current real estate slump is due to all of the information on the web: people are no longer being duped as readily by realtors.

Comments (8) -- Posted by: madhaus @ 5:04 am

February 3, 2013

They Like Us! They really, really Like Us!

130202-fb-calloutNotice something new in the right-side column?

At long last, we’ve set up a Facebook Page, and we’re collecting Likes.  We’re not really sure what we’re going to do with them.  Maybe there’s a Mortgage Equity Withdrawal program out there who wants every one of your names.  But more likely we’ll just wonder which Facebook Name goes with some of the more interesting handles our commenters have used.

Anyway, please click that Like button if you have a Facebook account, because right now we’re still in single digit territory, and Patrick.net is threatening to beat us up behind the gym.

This is also your opportunity to grouse about Facebook, or its policies, or its stock price, if you don’t find the housing-related piece today to your taste.

Click here to post a comment -- Posted by: madhaus @ 8:06 am

Top Ten Reasons You Should Ignore Realtard’s Columns

Today we’re going to have a look at a realtard’s piece over on Trulia’s blog.  Thanks very much to Burbed reader Real Estater for letting us know about this essay.

Tough Year Ahead: Top 10 Issues Facing Bay Area Buyers

East Bay Real Estate Focus — Providing Definitive Information for the East Bay Area
By
Carl Medford | Agent in Fremont, CA
Posted under: Market Conditions in Alameda County, Home Buying in Alameda County, Home Ownership in Alameda County  |  January 26, 2013 8:22 AM  |  257 views  |  1 comment

“TWO recent national surveys of real estate agents suggest that first-time buyers are on the decline, their access to the housing market blocked by tight credit and eager investors,” states Lisa Prevost, of The New York Times (12/20/212).

Old news. In fact, I’ve been saying the same thing since August, 2012.

Truth is, no one knows exactly how many have decided to sit things out a bit until the market calms down. Although we’ve seen a decline in the number of buyers “actively in the hunt,” in reality, there are not “fewer” first-time buyers – if anything, there are more. LOTS more. The problem is that less of them are actually managing to buy a home, and, unfortunately, that’s the primary statistic that is being measured. No one is sitting outside open houses counting the bodies as they hit the front door and then compiling the numbers to a national database. If they did, a much different story would be on the evening news.

Buyers trying to purchase a home in the existing market conditions are facing into the teeth of a perfect storm, real-estate style, and it doesn’t appear that it will be ending anytime soon.

Here are the Top 10 issues facing Bay Area buyers:

130202-top10-suitcaseActually, as realtard happyprop goes, this is a little bit better informed than most.  It does say something other than “NOW IS THE TIME TO BUY,” and best of all, the disturbing faceless and sexless icons include the ever-popular, we swear we are not making this up, Dude With A Suitcase Full of Cash.  We know you won’t believe without seeing, so here he is.  (And from the minimal clothing, it’s either a Dude or it’s Annie Hall.)

Here’s that Top Ten list. If you’ve been a regular reader of Burbed, none of these should surprise you.

  1. Sorry, you missed the bottom.  Sucks to be you.  Medford says February 2012 was the official bottom.  Maybe it was… in the East Bay.
  2. Inventory? What inventory?  Raw meat, here’s the sharks.
  3. Prices are going up.  Some areas are up 40% from last year.  Actually, if Mr. Real Estate Person had read the actual data instead of just looking at a piece in the Chron, he’d have seen that some areas are up a lot more than 40%.
  4. Lots of cash buyers out there.  Yeah, and not just in the hellhole that’s the East Bay.  RBA too, only these aren’t investors.  On this item the realtard confuses the difference between “Central County” (probably Alameda County given the link) and the entire Bay Area in claiming 30% of all offers are cash.
  5. Crowds lead to multiple offers.  Take low inventory and desperate sellers, what do you expect, other than the author citing hard numbers with his opinion columns from a different site.
  6. FHA or VA buyer? Don’t even bother in this market; even conventional buyers are losing out to Mr. Suitcase.  And Mr. Suitcase doesn’t care about appraisals.
  7. 130202-top10-house-familyNew homes are in demand againaccording to CNN, that is. That doesn’t apply to the RBA because they still aren’t making any more land.  Why the realtard didn’t quote this local story in his own backyard is left as an exercise to the reader.
  8. Appraisers haven’t a clue prices are up, which is preventing prices from going up even faster.  Includes helpful link to another of his columns mostly about packed open houses with one throw-away graf about appraisers.  What stayed with us was the tsetse flies.  But there was something useful mentioned: appraisers were blamed for the last bubble, and they’re not ready for this one.  Yet.
  9. Banks are mucking up your loan even more than usual, although the link provided explaining the loan approval process doesn’t look to us like anything has changed much.  We suppose if you’re a realtard remembering the glory days of If You Can Fog This Mirror You Can Buy This House, you’d have a different opinion.
  10. Bank underwriters especially are being poopy-heads, and Medford’s happy to give some examples. Most of them look like underwriters working through a pile of documents, marking off inconsistencies, and resolving them later, where later is some period greater than the five minutes realtards think is appropriate.

While we are perfectly capable of posting house after house in the five mile radius of The Googleplex, we would never confuse the RBA with the entire Bay Area.  Just because an agent can write a column even longer than one of ours doesn’t mean he won’t commit the Fallacy of Composition.  The East Bay isn’t the entire Bay Area any more than the South Peninsula is.  Market conditions vary, so may your mileage, and definitely will housing prices. 

But we can guarantee there will always be some real estate professionals out there who take a few shortcuts.  Let’s give this one a golf clap for giving the appearance of a housing market review, even if he found ten different ways to say You Are Now Priced Out Forever.

Comments (4) -- Posted by: madhaus @ 5:09 am

February 2, 2013

The Dignity Mortgage: Subprime with Training Wheels

Here’s a look at some new mortgage meshuggeneh from Burbed reader nomadic.

Housing advocates push for new type of subprime loan

The Dignity Mortgage would have a higher rate for higher-risk borrowers but include rate cuts after five years of on-time payments.

130201-latimes-dignityBy E. Scott Reckard, Los Angeles Times; January 28, 2013, 5:53 p.m.

PHOTO: Pattie and Ollie Sibug would like to buy their San Diego town house, which they are renting for $1,750 a month. They are among those who may benefit from a proposed subprime mortgage program. (Allen J. Schaben, Los Angeles Times / January 29, 2013)

With home prices rising, interest rates falling and builders building, some prominent housing advocates are calling for a new kind of loan for buyers with lower incomes or bad credit.

They’d like to call it the Dignity Mortgage, but it has another name — one that’s become more of an epithet since the housing crash: subprime.

Applicants might include people caught in the early stages of the mortgage meltdown who have since rebuilt their finances, said Faith Bautista, who heads the National Asian American Coalition.

"They lost their work, their homes and their credit scores four or five years ago," Bautista said.

And let’s see what nomadic has to say about this idea.

These people are pushing for a mortgage that not only gives them better terms after five years of timely payments (which seems reasonable) but they want the extra interest paid during the "trial" period REFUNDED to them after those five years. In other words, the banks take more risk but don’t actually get paid for it in the end. Not to mention all of the other extra costs of the program (e.g., "extensive" financial counseling). WTF? Also thought it ridiculous that the rate goes down to what people with "sterling credit" and 20% down are paying. I haven’t done the math, but I suspect people aren’t necessarily paying off 10% of the purchase price in the first five years of their loan.

Think this is a better way to treat the poor people who shouldn’t have been buying houses at all but want another swing at the property piñata?  Or was it all the banks’ fault from start to finish? Aaaaaaaaaand, this is an Open Thread.

Comments (15) -- Posted by: madhaus @ 5:16 am