I won't make a habit of it, but I couldn't resist writing about this other Bay Farm beauty that just showed up on Craigslist for $849,000.

-4 Bedrooms/3 Baths/Approx 2,300 Sq/ft
-Full Bedroom & Bath Downstairs
-Open Floor Plan with High Ceiling
-Elegent Hardwood Floors/ Updated Kitchen
-4000 Sq/ft Lot (per county records)
-Dual Pane Windows/Spacious Bedrooms
-No HOA Dues or Mello Roos Bonds
-Close to Park, Public Transportation & Shopping

Note the very similar style to the other listing in 94502 I wrote about earlier...


... and the likely distressed status of the sale:

Sold 12/21/2005: $859,000

2007 Property Tax: $10,416

I rarely blog about the dirt people over in 94502, but in observance of the upcoming Independence Day weekend, I thought I'd mention a condo over yonder that's pretty symptomatic of (you're correct, Independence Day has nothing to do with anything). 1019 Kingston Lane (MLS #40346075) looks like a nice, good-sized unit that's currently listed at $599,000:

Premium location facing greenbelts and pool. Almost $80k in upgrades (per seller). Granite kitchen counter tops, wood floors, updated baths. Good size tiled patio backyard. Spacious bonus den. Attached garage. Dual pane windows in living rm and bedrms. Must see! 

-Spacious 3 Bedroom/2.5 baths plus Family Room & Large Upstairs Bonus Room
-Approx 2,004 Sq/ft Living Area (per county)
-Nestled in an Acre of Landscaping & Just Steps to Pool & Club House
-Attached 2-Car Garage with Work Bench & Storage
-Indoor Laundry Room with Storage Cabinets & Windows
-Mater Bedroom wih Walk-in Closet & Mirrored Closet Doors
-Almost $80k in Upgrades (per seller)
-Mostly Dual Pane Windows, Hardwood Floors, & Custom Paint
-Newly Replaced Doors, Locks & Baseboards
-H.O.A. Fee: $405/mo.(includes Insurance, Maintenance, etc.)No Mello Roos Bonds
-Close to Parks, Public Transportation & Shopping

What with $405 in HOA fees and property taxes, we're looking at $4,000 a month, at the very least, to live in a condo near the airport.


If you subtract $80,000 in upgrades and 6% ($42,000) for the agent's commission, you're looking at a net price of $477,000, which is (surprise!) nowhere near the previous purchase price in 2004:

Last sale and tax info

Sold 05/14/2004: $518,500

2007 Property Tax: $6,829

On a semi-related note, über-bear economist Christopher Thornberg was a guest on today's Forum on KQED radio, and the poor man had the hardest time explaining what really should be obvious: that the real estate and foreclosure crisis is not a consequence of the credit crunch, and that foreclosures are not causing values to drop, but rather that the credit crunch and price drops are the result of the speculative bubble that drove prices too high. Prices are dropping back to where they belong, and we're a long ways away from stabilization. But his main point, which he's been making for years and I agree with, is that the root cause of the problem is that real estate is overpriced and overvalued, and prices are reverting back to more affordable levels (i.e., levels people can actually afford on their salaries). It's taking a while, but we're certainly seeing it happen here.

No photo yet for this "bright and cheery" Victorian on San Antonio (MLS #40352353):

NEW LISTING! FiRST TIME OPEN Sat & Sun 7/5&6 2-4pm. MUST SEE this beautiful, bright & cheery Queen Anne cottage with spacious rooms on a HUGE lot! Formal Entry, Living & Dining rooms with original trims, Tall ceilings, Built-ins & Hardwood floors; Very large eat-in kitchen;Laundry;Garage; MUCH MORE!

It's nice and big (though the listing shows exactly 100 sqft more than the public records), with 4 bedrooms and a large lot indeed, and a price to match ($798,000):

General Information
City/Town Alameda State CA Zip 94501 County: Alameda SubDiv: central alameda Price: $798,000 Bedrooms: 4 Full Baths: 1 Half Baths: 1	SQFT: 1823 Lot Size: 0.17 Basement: unfinished basement Stories: 1 Story Style: victorian

The lack of a second full bathroom is a bit of a letdown, but then it's hard to expect 2008 comforts in a 133-year-old house. That said, one wonders why the owners are letting go of it just 2 1/2 years after purchasing it:

Last sale and tax info

Sold 11/15/2005: $770,000

2007 Property Tax: $9,417

Assuming a 6% commission and full purchase price, we're looking at a $20K haircut. At $438 / sqft (i.e. essentially a 2006 asking price) I don't see how this one's going to fly.

The past couple of weeks have seen a flurry of new listing activity: as of today, 6/25/08, 19 new properties had been listed on the MLS for 7 days or less, and that's just in 94501. To be fair, quite a few of them don't appear to be distress sales, including a couple of big proud Victorians, and I do pick and choose which ones I write about.

That being said, there are still a lot of screwy transactions to pick from. Today's selection is a 1922 "Victorian" on the north end of Saint Charles, listed at $659,000 (MLS (r) #40351721):

Handsome home [...] Great light throughout, roomy 2-story layout, deep lot w/ plenty of off-street parking. [...]

There's no photo, just a silly artist's rendering, and I couldn't spot a property that looked like the hand drawing on Google Street View or Live Maps' Bird's Eye View, so this is all we have to work with:

This block of Saint Charles is not one of the most desirable parts of town. It's not as hideous as Clement or Blanding, but it's also nowhere near as nice as most areas 5 blocks or more south of it. Given its location, $413 / sqft is a little steep, but then it appears the owners don't have much of a choice:

Last sale and tax info

Sold 08/15/2005: $690,000

2007 Property Tax: $8,598

Sometimes the sale history of a home just doesn't make a lot of sense. Today's new property on High street (MLS #40351239) is one of those homes:

Lovely, light-filled Fernside Colonial Revival with bay windows in LR/DR; decorative fireplace; built-ins; sunny kitchen w/ss appl.; hardwood floors, study; plus room w/dormer; huge bsmt. Plus room & attic not incl. in sq.ft. Sewer lateral replaced. 2004 roof. Historic list.

On the face of it, it's very pretty, large, in good shape, and located in a popular part of town:

1607 HIGH STREET, Alameda, CA 94501

Beds:	3	Type:	SFR	Sq. Ft.:	1,835	Lot Size:	4,720 Sq. Ft.	MLS #:	40351239
Baths:	2/0	Built:	1898	$/Sq.Ft.:	$490	List Date:	06/23/08	On Market:	0 day

It's on the market at $899,000, which is high but sadly in line with what East End homes have been listed for. But what puzzles me is this:

Sales History

Sale History & Tax Info

Sale History
07/03/2007:	$940,000 **
07/03/2007:	$940,000
04/11/2006:	$720,000
12/24/1996:	$70,000 *
Show all sale history See less sale history
* Transaction not included in Zestimate.
** Transaction provided by seller

First of all, the owner has owned it for 10 months. Second, s/he is listing it for quite a bit less than s/he paid for it. Third, the previous owner only owned it for 15 months, yet sold it for a huge premium. Fourth, even though Zillow already has public record information for that recent transaction, the seller went to the trouble of providing the date and price of a purchase they have every reason not to be particularly proud of.

So, what gives?

Update 9/18/08: Sold for $855,000.

I just saw this Santa Clara listing in the real estate section of this week's newspaper. It's "coming soon" according to the broker's Web site and so there is no price or MLS number, but the pedigree, size, location and picture already have me salivating.

Hot on the heels of today's McMansion comes another nearby (MLS #40349729) for $100K less, i.e. $799,999:

Beautiful house built in 2006 in planned neighbourhood. Bull nose corners, cove ceilings.Upgraded maple cabinetry.Tile floors in entry and kitchen, french doors, Balcony with french doors.Custom interior paint.Pre-wired - surround sound, gas fireplace insert, plantation shutters,Flagstone patio.

There's no photo in the MLS, but Zillow's aerial photos come to the rescue:

I love huge houses on brand new tracts that still manage to be essentially glued to the neighboring structures.

This house and its cousin have different listing agents, but the silly pricing strategy (1 dollar under the next round number), comparable price per square foot ($336 v. $320), shared location and recent sale histories make me suspect a series of transactions gone sour. Behold:

Last sale and tax info

Sold 09/07/2006: $879,000

2007 Property Tax: $11,755

In plain English, that spells "oops."

Update 10/31/08: Spooky price drop to $649,999. The drop history picked up in October: $150,000 and still no bites? $230,000 drop since last sale? That's epic.

09/08: $799,999 to $774,999
10/03: $774,999 to $749,999
10/15: $749,999 to $699,999
10/30: $699,999 to $649,999

Update 11/22/08: Short sale, per Zip Realty.

Update 3/23/09: Still on the market, dropped to $625,000 about 6 weeks ago.

Update 9/5/09: Sold for $635,000 in April. 28% off.

This new McMansion on Jouett Sq (where the heck is that?) just showed up today (MLS #40349789):

Beautiful three year young home. 4bedrooms, 3 bathhs and an office downstairs!Lots of upgrades. custom tiled foyer, custom draperies. gourment kitchen , island with custom granite countertop, stainless steel appliances, and custom cabinets. professional landscaped backyard. Tons of upgrades.

That sounds really nice. The outside, however, remains a mystery, and there are only pictures of the interior, such as this:

The asking price is $899,999, which seems low enough considering the house is 2805 sqft (i.e. $320 / sqft), although the whole 1-dollar-below-$900K is silly and cuts out buyers who search for homes starting at $900K, but agents never learn, and besides there can't be that many folks in Alameda whose starting price is $900K. But the best part is the home's sale history:

This unassuming rancher at 214 Pacific just came on the market today, listed at $464,900 (MLS #40349348):

WONDERFUL RANCH STYLE HOME,COZY LIVING ROOM W/FIREPLACE,GOURMET KITCHEN W/BREAKFAST NOOK,SPACIOUS BEDROOMS,PRIVATE BACKYARD WITH PATIO,CLOSE TO SCHOOLS,PARKS,AND SHOPPING

The funny-looking price suggests a bank sale, and sure enough:

3321 Central Avenue just reappeared on the MLS (MLS #342953, previously known as MLS #40290048) today for $565,000:

Spacious 3 bedrooms, 2 full baths East-end single level rancher. Rear bedrooms each have decks and access to secluded rear yard. Long driveway, detached garage, and gardening shed. Hardwood floors, upgraded master bath, fireplace, and steps away from San Leandro Bay shoreline.

I knew this "new" listing looked familiar: a little digging on Zillow reveals the old MLS ID and the following picture:

What didn't look familiar was the new price, which seems a little low considering how large the property is (1,489 sqft). This is what I remembered:

Sterling Avenue is known as "Bungalow Boulevard" (at least that's what a listing on that street said), and a cursory look at a map bears this out. This means two things: one, the street looks all quaint and pretty; two, the comps are right under your nose. And given the difficulty 3240 Sterling had selling earlier this year, it doesn't bode well for today's new listing, just across the street (MLS #40348386, 3247 Sterling).

FIRST TIME OPEN! SAT&SUN 6/14-15 2-4pm. Amazing wood & beautiful built-in cabinetry in this terrific Craftsman bungalow with 2+ bedrooms & 2 baths (bed/bath on main level; Master Suite on Upper Level). Formal Entry, Living & Dining Rooms w/Hardwood Floors & period details. Fireplace; Detached garage

At 1,437 square feet, and what seems like a larger (or improved) interior space, its neighbor is not exactly a comp, but the lots appear to be identical:

Property Information
Street Number:	3240
Apt Number:
Street:	Sterling Ave
City:	Alameda
Zip Code:	94501
Beds:	2
Baths:	1
Year built:	1920
Sqft:	1,194
Lot Size:	3,422

Property Information
Street Number:	3247
Apt Number:
Street:	Sterling Ave
City:	Alameda
Zip Code:	94501
Beds:	2
Baths:	1
Year built:	1918
Sqft:	1,437
Lot Size:	3,422

What's more interesting is that unlike its neighbor at 3240, today's listing is starting at $608,000, below its previous purchase price. Perhaps the owners took note of their neighbor's tribulations and price drops and decided to spare themselves the trouble?

Sales History
Historical home sale price (1):	$629,000
Prior sale date:	Jul 31, 2006
Change since this sale (1):	NA
Historical home sale price (2):	$475,000
Prior sale date:	Jun 18, 2003
Change since this sale (2):	+32%
Historical home sale price (3):	$104,000
Prior sale date:	Nov 10, 1998
Change since this sale (3):	+505%

Over the past few weeks, I've had the distinct impression some sort of threshold has been crossed and REO/foreclosed homes are hitting the market in larger numbers than before. Today's listing appears to be one of them. 1808 Walnut Street (MLS #40348338) just came on the market at $499,500 (not the non-round number, often betraying the property's unfortunate fate):

Zoned for 2-4 single family. Build to duplex. Huge yard. Awesome potential.

The yard is indeed really big (5,200-sqft lot per public records), and the potential for extra construction must be irresistible: whoever buys this now will be the second owner in just 14 months to try their hand at real estate mogulery.


Update 9/17/08: Dropped to $489,900 and described as "bank owned" in the MLS(r) listing. Whee.

With all the financial institutions getting gobbled up by the government these days, when a house goes back to the bank, does it mean you and I own a tiny little piece of it if (when) that bank gets bought/swallowed/rescued/bailed out/etc?

(map)

Your tax dollars at work.


Update 10/12/08: Dropped to $464,900 a couple of days ago.

I'm seeing a lot of properties on the market these days that were sold in 2004 or 2005, "priced to sell". That doesn't mean "priced reasonably"--it just means "listed at 2004-2005 prices", which were too high then. My guess is that we're just seeing the first glut of subprime ARM resets unwinding, as charted in this popular picture:

Today's first victim is a small duplex on Eagle (MLS #40347917) that "needs work" but is listed considerably below any other comparable property currently for sale, at $349,000:

General Information
City/Town Alameda State CA Zip 94501 County: Alameda Price: $349,000	SQFT: 1300 Lot Size: 0.08 Building Description: Total Units:2 Unit 1 Bedrooms:2 Unit 2 Bedrooms:2
REMARKS
Great Income property or Owner user at convenient location. Walk to Park St. shops and rest. Separate elect. and gas meters. Two separate storage sheds. Presently occupied by tenants (rent by room). Property needs work as reflected in price. Parking in backyard thru easement. Hurry!!!

Sure, the location itself is subprime, right in the middle of car shop and used car dealership country, but at least the price is somewhat reasonable. Except, of course, if you're the seller and remember this:

Last sale and tax info

Sold 04/12/2004: $478,000

2007 Property Tax: $6,450

Using generous assumptions (30-year, 6% fixed-rate mortgage, 20% down, 1% of purchase price for maintenance, 90% occupancy), it takes a fair amount of money to make a $730,000 fourplex cashflow-positive. You need at the very least $3,500 a month for the mortgage alone, plus $600 a month for maintenance, plus insurance and an extra 10% as a cushion in-between tenants. Add $800 for property tax. And because you put down 20%, you need to make up for the $146,000 you no longer have earning interest at 3%, i.e. $365 a month you're not earning anymore. The ballpark numbers remain conservatively valid if you put down less, because your interest shortfall is more than absorbed by the higher mortgage.

So let's be generous again and assume you can break even with $6,000 in rental income per month, or $1,500 per unit. Given the rental comps (in 2005, you could get a nice 1,000+ sqft townhouse by the beach with a pool and various other amenities for under $1,500), each one of your units would have to be a 1,000-sqft 2-br 1-ba or better, each with a parking space. So we're talking about a 4,000-sqft Victorian mansionette in good condition with a big lot to accommodate the parking situation.

Right?

Not quite (MLS #40347587). 4 units (3x 1-bedroom, 1x 2-bedroom), 2,345 sqft, $749,000

[...] Victorian fourlex [...] in good shape [...] concrete foundation added in 1993. All units are currently rented. There is one attached garage.

Sure, it's pretty, but not by the beach, and smaller than our comp-based projection by about a third.

Where did I get the $730,000 from?

Last sale and tax info

Sold 08/03/2005: $730,000

2007 Property Tax: $9,722

You can get a calculator for $1 at the dollar store, and anyone with an 8th grade education can do the math above. Why not avail yourself of that before you put yourself on the hook for three quarters of a million dollars?


Update 8/8/08: Dropped to $719,000.

$719000 Fully rented Four Unit Building in the Heart of Alameda (alameda) (map)

---

Reply to: hous-788639691@craigslist.org
Date: 2008-08-08, 12:48PM PDT

Mark Playsted | Harbor Bay Realty | 510-917-8072 919 Central Avenue, Alameda, CA Victorian Conversion Fourplex ideally situated in the heart of Alameda

Update 9/16/08: Dropped to $699,000. Projected income is a measly $42,900, almost $30K below my estimate earlier.

Update 9/24/08: Dropped another $1,000 to $698,000.

Announcement: read about EBRD, Inc.'s DMCA content removal complaint against this blog

Just as I was writing about prices coming down, this new listing (MLS #40347312) at 1815 Harvard Drive made a liar (fool?) out of me:

Georgeous Fernside Home. Oversized living room, formal dining room, hardwood floors and tons of charm. Office with wood detail. Bright kitchen with upgraded appliances & breakfast bar. Cozy family room off kitchen. Master suite with library & balcony. Master bath & sauna. HUGE & lovely yard!

Fancy neighborhood (although I personally find the Fernside area boring and Stepford-Wives-creepy), big house (2,326 sqft), respectable lot (4,800 sqft), decent looks:

But a comp killer this ain't: it just came on the market at the coy price point of $969,000, just enough under $1M to look as though the sellers are making an effort. But they're not fooling anybody:

Sale History
10/14/2005:	$960,000
11/18/1998:	$488,000
2007 Property Tax: $11,550 No other sale data is available

Even with 0% commission from friendly agents, the property tax, moving and transaction-related fees will eat up the $9,000 premium over the previous purchase price. And that's assuming they get their wishing price, which given the current market conditions is a long shot.

Just for chucks, the Zestimate is around $830,000 as of this writing.

Update 7/16/08: Apparently sold for $975,000. What is so great about Fernside!??

Might this new listing be a sign of things to come (MLS #40347356)?

Cute house in great location. Lots of style. Close to everything. Dual pane windows, fireplace, newer granite kitchen with SS appliances, updated bathrooms, loads of upgrades. Extra parking in the driveway. Front porch to enjoy the evenings.

It's small (895 square feet), not in the best location but not the worst either (2312 Eagle Avenue), but it's not a fixer: it's got Nazi appliances, updates and upgrades. And it's cute enough:

Current comps have been priced in the $500Ks. But this home just came on the market at $404,900. Not $504,900. $404,900. One can only hope this is a sign of a return to more reasonable prices. Of course, at $452 / sqft, that's still too much money, but it's still considerably less than what we're used to around here, and might well be the first comp killer to appear for a while, and summer hasn't even begun.

The sale history suggests a lot of distress, but at least whoever currently owns the home is sensible enough to try to get it off their books asap:

Sale History
12/28/2007:	$495,000 *
01/26/2007:	$580,000
06/21/2006:	$415,000 *
No other sale data is available
* Transaction not included in Zestimate. More info

Zillow's claim to fame is their "Zestimate" (tm), an automated valuation of your home based on comps and various other data points. If you claim your home and enter certain facts about it (e.g. fill out size and number of bathrooms that might be missing from the county records), you can obtain a revised "Zestimate" that gets displayed as the "owner's estimate" next to the official one.

One presumes this is used by sellers tryinto justify their asking price when the plain old Zestimate is too low for their taste (or the amount they owe), and sure enough this pretty Victorian (MLS #40346792) that just came on the market has a big fat custom owner's estimate:

Great central alameda home with extensive renovations almost complete. 3 bedrooms, 1 bath upstairs along with formal dining room, eat-in kitchen and living room. Build-out of lower level underway with 6 more rooms, including bath and laundry room. New foundation. Open sunday

Note the "extensive renovations [are] almost complete," which might be code for "gosh, we ran out of HELOC money, let's get outta here."

This house is listed at $739,000, right around the current Zestimate, but quite a bit less than the owner's estimate. What a deal!