Tuesday, July 22, 2008

Sunset Park outcomes

Next up: Sunset Park outcomes, from the low-end below $1M (2620 24th, photo above, finally pending after a 23% price reduction to $900K), to the high-end passing $2M (2307 Ashland, photo below, sold for $2.2M, although below its attempted $2.39M), and a lot in-between.

Two examples came out of the gate with very attractive low-end prices and got bid up. While others took months and big price reductions to finally sell, like 2516 Cloverfield that tried for a record $2,595K, finally in escrow after a year and a 27% price reduction.

Striking is half sold for below $1.1M, clearly a desired price range, while the unsold inventory is the higher-priced stuff.

Some recent resales didn't do well. Previously-featured 1621 Ashland is finally in escrow, but presumably at a loss from $1,450K in 2005 to most recent asking of $1,415K, not to mention commission, etc. And will the "Airport View" flip at 2314 Pier, bought spring 2007 for $920K and finally in escrow break even after expenses?

Also time to reinforce my masthead disclaimer, that I do my best to accurately bring together data from multiple sources, but there certainly could be errors in my sources or my bleary-eyed transcription. Hey, don't make a multi-million dollar decision only from an anonymous blog!


2376 Dewey, 3 bed/2 bath, LP=$699K (-39% from OLP), OLD=3/2/07, SD=5/15/08, SP=$678K (-3% from LP) (sold 11/22/06 $1,100K)
2638 32nd St, 2/1, $865K (+4%), 6/6/07, 4/16/08, $815K (-6%)
2338 Pier, 3/2, $898K (-3%), 9/16/07, 6/3/08, $875K (-3%) (sold 3/9/07 $860K)
2010 Hill, 2/2, $949K, 6/9/08, 7/18/08, $998K (+5%)
2658 32nd, 3/1.75, $959K, 2/19/08, 4/1/08, $960K
2651 33rd, 2/1.5, $978K (-2%), 12/12/07, 5/2/08, $940K (-4%)
1026 Ozone, 3/2, $999K, 5/5/08, 6/18/08, $980K (-2%)
1322 Maple, 2/1, $999K, 3/12/08, 7/8/08, $929K (-7%)
2520 26th, 3/2, $999K, 4/10/08, 6/4/08, $1,160K (+16%)
1717 Robson, 2/1, $1,039K (-13%), 10/12/07, 6/2/08, $949K (-9%)
3118 17th, 2/2, (red. $1,049K), 9/7/07, 2/22/08, $1,067K (+2%)
3409 Pearl, 3/2, (red. $1,099K), 1/7/08, 3/3/08, $1,055K (-4%)
1720 Cedar, 3/1.75, $1,100K, 3/13/08, 6/6/08, $1,000K (-9%)
838 Pacific, 4/3, $1,168K, 12/19/07, 3/08, $1,073K (-8%)
1307 Marine, 3/2, $1,195K, 11/6/07, 2/21/08, $1,100K (-8%)
2723 11th, 2/2, $1,199K (-11%), 5/2/07, 6/17/08, $1,075K (-10%)
2643 31st, 5/2.5 (duplex), $1,250K, 1/7/08, 2/20/08, $1,300K (+4%)
3041 Paula, 5/4, (red. $1,395K), 10/5/07, 2/26/08, $1,170K (-16%)
1348 Hill St, 3/2, $1,450K (-9%), 9/17/07, 4/1/08, $1,450K
2511 25th, 3/2, $1,499K (-6%), 3/31/08, 6/23/08, $1,490K (-1%) (sold 7/11/07 $1,000K)
2334 26th, 3/2.5, $1,600K, 12/28/07, 4/1/08, $1,575K (-2%)
1336 Sunset, 4/3, $1,625K, 12/14/07, 2/28/08, $1,568K (-4%)
2343 29th, 4/4.5, $1,895K (-4%), 8/2/07, 2/4/08, $1,825K (-4%)
1639 Hill St, 4/3, $1,997K (-9%), 11/27/07, 4/11/08, $1,900K (-5%)
2307 Ashland, 5/5.5, $2,390K, 2/7/08, 4/15/08, $2,200K (-8%)

Sale Pending

2620 24th, 2/2, $900K (-23%), 12/26/07, Pending 7/14/08
2392 Dewey, 3/2, $919K (-5%), 6/2/08, Pending 7/18/08
2314 Pier, 2/2, $1,099K (-12%), 7/9/07, Pending 7/7/08 (Sold 3/23/07 $920K)
1519 Hill, 2/2, $1,099K, 6/18/08, Pending 7/5/08
1621 Ashland, 2/1.5, $1,415K (-16%), 8/13/07, Pending 7/17/08 (Sold 10/31/05 $1,450K)
2637 34th, 4/3.5, $1,600K (-6%), 3/25/08, Pending 6/13/08
1047 Pacific, 3/2, $1,750K (-8%), 2/25/08, Pending 5/29/08
2516 Cloverfield, 4/3, $1,900K (-27%), 7/15/07, Pending 7/4/08
2246 25th, 4/5.5, $2,649K, 4/25/08, Pending 6/18/08

Expired or Withdrawn

1731 Cedar, 3/1, $1,135K (-12%), 1/18/08, Expired 6/08
926 Ozone, 3/2.5, $1,149K (-19%), 7/29/06, Expired 5/08 (Sold 2/24/06 $945K)
1702 Ashland, 4/3.5, $1,339 (-8%), 10/3/07, Expired 3/08
2641 32nd, 2/2, $1,399 (-7%), 4/24/08, Withdrawn 7/17/08

Information Needed

1320 Pearl, 2/1.75, $939K (-31%), 11/21/06, Gone 5/08 (Sold 4/28 $1,270K)
2432 21st, 3/2, $990K (-14%), 10/10/07, Gone 5/08
2610 31st, 2/1, $1,225K, 1/15/08, Gone 3/08
1741 Maple, 3/2, $1,275K (-20%), 10/14/07, Gone 5/08 (Sold 4/5/06 $1,300K)
2202 Marine, 5/4, $1,395 (-7%), 4/8/07, Gone 4/08
1640 Bryn Mawr, 3/2, $1,449K (-5%), 7/7/07, Gone 1/08
834 Maple, 3/2, $1,829K (-13%), 8/24/07, Gone 2/08


Anonymous said...

Okay... we get it. Things are stronger than they should be on the Westside. God this is depressing...

Anonymous said...

It doesn't seem that strong to me. I guess if you put it all on one page it is more sales data than I am used to seeing, so it may look like a lot, but it's showing weakness and definitely slow relative to the last handful of years. I'm surprised that 1621 Ashland finally went under contract. That's a nicely styled home, but it seemed overpriced.

Anonymous said...

Just in the last couple of days, Wachovia wrote down $6.06 billion for assets that lost value, and added $4.19 billion to reserves for bad loans. Washington Mutual took a $3.3 billion loss. Where did all the billions go that banks now have to write off? There was a huge wealth transfer in the last few years to owners of real estate, and that money is still sloshing around in the system. It will take a long while for those effects to dissipate.

Anonymous said...

Good job on the listings. Looks like all SM areas are slooooow moving, with the over-priced outliers falling to a normalized price range to get sold.

What if SFR prices muddle along, slowly drifting down during the cycle, but not dropping xx% across the board?

If other good neighborhoods cycle down and start to firm in a year or two, will SM have a locked-in higher price point, and look like pre-bubble prices all over again in a recovery?

I am not a super-bull, but there may be a new reality for floor prices before this is over. We saw this with the last downturn; SM SFR's kept a disproportionate amount of bubble value as a base, the bottom never fully dropped out like other areas.

Anonymous said...

According to LA Times chart on Dataquick 90402 median is down 8% from last year. So with a 5-6% commission homes bought in 2007 are now in a loss position and possibly headed for an upside-down positon depending on the debt.

Maybe it's just me but I can't see losing money on a home as a good thing. If these good folks buying could just wait a little longer they would get a better deal!

Anonymous said...

"Maybe it's just me but I can't see losing money on a home as a good thing. If these good folks buying could just wait a little longer they would get a better deal!"

Some buyers are in a position to do something today and just want to get on with their lives - get their kids in school, focus on career, etc.

No matter how the economy rolls, a certain number of folks will get a big bonus, make partner, inherit money, sell a business, etc. and are ready to buy, figuring it will all work out in the long run. The energy that goes into getting the best possible deal is energy they aren't putting into their career or family.

Anonymous said...

Since when is getting on with your life include losing money?

Anonymous said...

If you look at real estate as a pure investment vehicle and not as a lifestyle choice, you'd be crazy to buy now. For those people, it makes sense to wait and hope to catch the market at its lowest. I think that people who are on the other side of the divide and looking at their houses as a lifestyle choice and purely long-term investment are saying, so what if I pay 50K or even 100K too much. It's a long term purchase, inflation will take care of most of it, so why wait to have a house of my own to raise my family in instead of being at the whim of a crappy landlord in a rental house?

Anonymous said...

Since when is getting on with your life include losing money?

When you can afford it.

Just like buyers of ultra-expensive cars can afford to lose 30-50% of value in a couple of years. You can either stand outside a nightclub and call every driver of a $250k+ car an idiot, or accept the fact not all people are driven by (or need) the last buck.

Folks have different resources and different attitudes towards lifestyle spending, including real estate. And remember, this is the Westside, a microcosm of lifestyle spending and disposable income, not your average US metro - that is why you see all the $250k+ cars :)

Anonymous said...

Yea right! Of course we all have money to lose! I love losing money! How much should I lose? $50M $100M or maybe $100m? Where do you draw the line on how much to lose? The sky is the limit!

Anonymous said...

Perhaps it's not an investment vehicle for many homebuyers, but you still have th question the timing. If the market continues to fall, the unsold supply will probably increase and on top of your $100k savings (maybe more) you probably have better choice. If you absolutely must by a home right now then that's the boat you are in and good luck with your purchase. At least you probably saved about 10% from the peak.

Anonymous said...

"Where do you draw the line on how much to lose? The sky is the limit!"

You're right -- it's a hard line to draw. If you really believe that prices will fall 50%, then now is not the time. If you think it's 20%, you're in a tougher position. Do you take a great house now (perhaps only down 10% or 15%), and maybe pay too much, or wait a year or more and end up with something you don't like as much or perhaps end up in something better?

But unless you are absolutely firm in your conviction that you can predict the market's final position with certainty (which, realistically, who can?), you may find that you've been penny wise and pound foolish.

Anonymous said...

If 10-20% or $100-200k decline in value is enough to rattle your cage on what should be a long-term purchase paid over 15-30 years, you are either resource challenged or pathologically risk averse. Either or both ways, you should consider other investments at this time and let others take the plunge. Nothing ventured, nothing gained.

Anonymous said...

Timing is very important! Timing is much more important than lifestyle! So when you see and hear that foreclosures are sky rocketing and home prices are coming down month after month, the prudent thing to do is to hold off on any home purchase until this nonsense levels off or at least slows down.

I guess it makes me sad that so many people are losing their homes because of a bad decision to buy a home they couldn't afford because they had to maintain their lifestyle. So much for their lifestyle.

Anonymous said...

You must be a realtor because you can't win this battle so now you want to challenge my financial capability! Why don't you go get a real job and stop trying to hurt honest working people for your 6% commission!

Anonymous said...

"Why don't you go get a real job and stop trying to hurt honest working people for your 6% commission!"

Work a little harder, make more money, and you won't have to sweat every dime (or be a lifetime renter with a pipedream to get a 50% discount on a distressed SM SFR).

Anonymous said...

Your 6% commission days are over! I hear McDonalds is hiring!

Anonymous said...

I guarantee that the poster who wrote "Work a little harder, make more money, and you won't have to sweat every dime" hasn't worked hard one single day in his/her life.

Anonymous said...

I just wonder where all the 250k car drivers who don't care how much stuff costs were in 2000? You remember 2000, it's where housing values were ~60% less. I guess not caring about losing money just became fashionable since then.

Anonymous said...

Sadly, too many of todays realtors are in the business for the 6% commission and could care less about a buyers financial ability. Like the realtor on this blog they care only about themselves and feel quite free to insult anyone who disagrees. This is a big part of the problem in real estate.

I know good honest realtors who will bite the bullet and forego a sale in order to keep good folks from losing their hard earned money on a home they can't really afford.

It would be nice if the realtor on this board was one of them!

Anonymous said...

Rather than talking about the substance of Westside Bubble's latest post, lets try to figure out who the realtor is!

Anonymous said...

I can't consider anyone resource-challenged if they are capable of buying a SFR in SM after another 10% drop. Even with a long term hold you save so much by starting at a better entry point. For me, it's the difference between holding my current house and renting it to someone and having to sell it to buy a move-up property. When I got into home ownership my stated goal was to never sell a single home and I hope to stick to it. I look at this guy I know who is a barber; he never sold a home until recently (traded into another rental property) and he has seven rental units (two homes, duplex, triplex). He's still working for peanuts at the shop, but long term strategy has paid off in spades as he lives beachfront and has amazing rental income.

Anonymous said...

believe me, today's realtors care a whole lot about a buyer's financial condition. It has nothing to do with the 6%. It's about a successful financing and close. Come on folks, the no-doc is so pre-August 2007.

Anonymous said...

...the World is a different place now, and so is our standard of living and our real estate market.

We can't compare past bubbles to our current situation because never before have we been faced with a global battle for resources...energy, labor, capital, etc. With China and India now online, we need to make changes and deal with scarcity. And this is a good thing, we've had it easy for a long time, and we've all gotten soft, just look at our fat kids.

While prices may still go down, the financing won't be there. Most of you won't be able to qualify for mortgages unless you come into windfall inheritances, lawsuit settlements, lotto, etc.

I think that the people who are waiting and have put their lives on hold are doing themselves a disservice. Don't buy a house because you expect to make money timing the market perfectly, instead buy a house because you need a place to live, start a family and add quality to your life.

Epsilon said...

Let's not forget interest rates in all this... they're creeping up faster than some of these prices are coming down. It would be interesting to see a monthly payment graph for the Westside, or listed properties generally... I have a bad feeling it's flat, or even ticking up...

As for realtors, I imagine they're like most people; it's not that they don't care, it's that they're doing a job, and their first priority is to get a paycheck and get on with their life. Right now, that paycheck is a little less certain, and at the same time everyone hates them. Have some sympathy; your industry could be in the same position at some point in your life.

Anonymous said...

I am the blogger who requested a comprehensive list of sold properties, and I really appreciate your effort to put together this list. If you could do the same thing for Ocean Park that would be very interesting as well. Prices may have dropped, but the commentor who noted that they have only fallen from the bubble level is very keen. However, do people really think these houses are going to be cheap in 5-7 years? They are not, people with money are always going to buy in SM. Just with inflation along the prices are going to be higher, that is not to say that prices may drop for a few years, but trying to buy at the bottom will likely miss the boat. Someone who has bought a lot of properyt over the past 30 years told me that they always thought they were paying too much for each property they bought. Even if the prices drop another 10-15% you are still paying over 900K for a starter home in sunset park.

Westside Bubble said...

You're welcome, Anon 10:24!

True that is always seemed expensive, and I doubt will ever seem "cheap".

My benchmark drop for Santa Monica is the 25% that low-end north of Montana fell 1990-96. With a flat bottom that gave a few years to buy at that level.

Is this time different? Worse in a number of ways, but so far more resistant locally. We'll see.

Anonymous said...

my understanding is that the teardowns and vacant lots North of montana fell from 900k in 1990 to 600k in 1995 or 33%

that is the benchmark i have in my mind

900k in 1990 to 600k in 1995 to 2.1 million in 2007

IF we repeat the 33% fall then we are looking at a fall from the peak of 2.1 down to 1.4

Anonymous said...

Hate to burst your bubble, but it is not very likely we will see NOM lots go down to $1.4.

Anonymous said...

"My benchmark drop for Santa Monica is the 25% that low-end north of Montana fell 1990-96. With a flat bottom that gave a few years to buy at that level.

Is this time different? Worse in a number of ways, but so far more resistant locally. We'll see."

I won't disgree with the low benchmark, my guess is 20%.

What is different this time around is the earning capacity of buyers - more high 2 earner households than 15 years ago, and more big cash pops in terms of bonuses, stock options, etc.

The other factor is the proven desirability of SM; 15 years ago folks were leaving SM to move to Calabasas, Westlake, etc, to get a large house in 'new upscale' suburb, not so much any more.

Anonymous said...

You're all a bunch of idiots. What happened? Did we get overtaken by realtors?

The crash is going zero out the gains of the last ten years! We're looking at 50% plus declines. Look at the state of the dollar!

Santa Monica is not different. Teardowns in 90402 will be trading under $1,000,000 before you know it!

Anonymous said...

anon 1040.

50% drop in NOM??? Please pass me some of what he is having. The poster above had it right that this time around there are many more millionaires and dual income families. NOM is a proven commodity and a highly desirable area. I am not in disagreement that we will see a continued softness in the market of some degree in this particular neighborhood. But economic crisis or not, this hood is not tanking.

Anonymous said...

I doubt the ratio of earnings to home values is any better know than it was in the nineties. It's probably worse.

Anonymous said...

And, in other news, chicken little has reported that the sky is falling. What facts actually support this area coming down by 50%? I don't even think Riverside or other less desirable inland areas have come down by that much.

Anonymous said...

Bunch of desperate Realtors! Homes in SM are going to crash and crash hard, and the only people who don't think so are in the home sales industry!

Anonymous said...

"I doubt the ratio of earnings to home values is any better know than it was in the nineties. It's probably worse."

On a national average, the ratio of earnings to home values may not be any better, but SM buyers in the $1.5 - $4.0M+ range are anything but average. Whatever type of work these buyers do to afford a big downpayment and monthly mortgage payments is not average joe stuff. And chances are they will do better going forward, and their house purchase will be less and less of their monthly expenses and net worth.

Don't discount the effect high earning / high net worth folks have on short and long-term SM prices - they buy when they want, and don't foreclose. And, more of them are settling on SM versus other luxe burbs as a lifestyle choice.

Anonymous said...

right - plenty of people who would have settled in calabasas or hidden hills 20 years ago are now deciding on sm

Anonymous said...

It's not that the valley is invading. It's that young couples with 1.5 million to spend are choosing a smaller home in Santa Monica as opposed to a monolith in the valley.

Anonymous said...

i hear you loud and clear


they are choosing a nice three bedroom condo in the 90403 instead of a five bedroom house in the valley

i wish they didn't have to make that choice but they do and many prefer the condo in the 90403 especially if they both work in sm

Anonymous said...


SOLD FOR $1.5 million. OLP was $1.695


Anonymous said...

How did you get the data on the 34th street house? We'd be interested to see some of the selling prices for homes we've looked at, and zillow isn't always accurate. Thanks!

Anonymous said...

yes - go do a survey of the young couples in SM -

those that can afford it are overwhelmingly planning to stay in SM in a teeny tiny place vs moving to the valley for a huge place

it is a huge huge mind shift

i remember 20 years ago very few planned to stay in SM after they had kids

Anonymous said...

re 6:09 - just type in the mls number you are interested into the link above your comment where the current mls number is and you should be able to check on what price it sold for. Hope this helps.