We have not seen anything yet in Seattle. That blind and busted Greenwood house demanding $450,000? Mere chump change when compared to a San Francisco Bay Area house that’s red tagged (meaning, you can’t even live in it) because it’s on a hill that’s not yet done moving around. The house was nearly wiped out by a mudslide. Its future is uncertain. It’s listed at $850,000.
And you can tell by the mood of the home’s four bedrooms and three bathrooms, that it’s really pissed about this price. If it weren’t for that damn mudslide and its precarious position, it would have sold for a cold $1.5 million. It does not end there. If you buy this house (and it has drawn some interest), you also have to stabilize a whole hill. How much does that even cost? Repairs on the house alone are expected to be $300,000. The owner feels the price of the unlivable house is justified because “there is only so much real estate on the planet.” Only a NIMBY sees the earth in that very restricted way.
Seattle, look at this sorry situation and think deeply about where we are headed. Housing should never reach the condition of complete madness.
Six months ago, there was widespread talk about the flattening of the Bay Area housing market — its red-hot temperature had calmed to a simmer.
That conversation appears to be ancient history.
To wit, this example: Alain Pinel agent Mark Wong sent out an email blast Tuesday revealing that around 60 South Bay homes, mostly in Sunnyvale and Cupertino, sold for $200,000 or more over the asking price in the last 30 days. And he wasn’t necessarily talking about fancy schmancy places. One modest Cupertino house — 1,046 square feet — sold for $660,000 above its listing price.
The news from Wong is a snapshot of just how nuts the Silicon Valley market has become this spring as motivated buyers fight over a limited number of homes. The competition is especially fierce in Sunnyvale, because of its proximity to hiring at the new Apple spaceship campus, and Cupertino, which is perennially hot because its schools have a reputation for excellence.
Randomly, here are a few of the numbers in Wong’s email:
A house at 1051 Heatherstone Ave. in Sunnyvale listed at $1,888,000 and sold for $2,370,000 — $482,000 over asking.
A house at 553 Croyden Court in Sunnyvale listed at $1,998,000 and went for $2,450,000 — $462,000 over asking.
A townhouse at 982 La Mesa Terrace, also in Sunnyvale, listed at $1,099,000 and sold for $1,400,000 — $301,000 over asking. For a townhouse.
“The listing price doesn’t mean anything anymore,” Wong said. “It’s just a number.”
“Most of the agents, they love to list under the fair market value, so that’s why it creates an auction-style sale,” he said. “The buyers are smart people. They look around. And when they see a property below the fair market value, they think they’ve found a good deal and they’ll jump on it. Then everybody jumps and it bids up the price.”
Wong compared Sunnyvale and Cupertino sales from the last 30 days to sales in those two cities during the same time period last year.
In Sunnyvale in 2016, 75 houses, condos and townhomes sold during the 30-day period. Of those, 58 sold for more than the listing price, but only eight went for $200,000 or more above asking. This year’s 30-day totals: 84 homes sold, 74 for above asking — including 37 for $200,000 or more above asking.
In Cupertino, these were the 2016 numbers: 60 homes sold, 45 above asking, with five selling for $200,000 or more above the listing price. This year: 60 homes sold, 50 above asking, including 15 for at least $200,000 more than the listing price.
The numbers show “that the competition is much tougher than last year,” Wong said, “and buyers got used to this kind of pricing strategy in purchasing.”
This house in Cupertino recently listed for $1,300,000 and sold for $1,515,000 — $215,000 above the asking price. Given the limited housing supply, Bay Area homebuyers are once again fighting over real estate, driving prices up, especially in hot markets like Cupertino and Sunnyvale where dozens of homes sold in the last 30 days for at least $200,000 over the listing price. (Courtesy of Mark Wong/Alain Pinel Realtors)
But this is not just a tale of those two cities. Agents recently have reported escalating prices in Mountain View’s Monta Loma neighborhood; priced out buyers have given up and moved down the road to Sunnyvale. Homes have been going for $300,000 over asking in Redwood City and — no surprise here — in Palo Alto.
In the East Bay, Pacific Union agent Carla Buffington said buyers priced out of Oakland’s Rockridge neighborhood simply scoot over to nearby Temescal, while buyers who can’t afford homes in North Berkeley try their luck in the Berkeley Flats. In Oakland, she said, a home in the Fruitvale district recently listed for $789,000; its sale is pending for more than $1 million.
“I feel like everybody has a million dollars,” she quipped. “There’s just a lot of crazy sales.”
Which brings us back to Wong’s email blast.
Its “way over asking” sales in Cupertino include a house at 18625 Ralya Court that listed at $1,299,999 and sold for $1,622,500 — $322,501 over asking. A house at 10384 N. Portal Ave. listed for $1,788,000, then sold for $2,160,000 with 11 offers — a cool $371,200 above the asking price.
We have not seen anything yet in Seattle. That blind and busted Greenwood house demanding $450,000? Mere chump change when compared to a San Francisco Bay Area house that’s red tagged (meaning, you can’t even live in it) because it’s on a hill that’s not yet done moving around. The house was nearly wiped out by a mudslide. Its future is uncertain. It’s listed at $850,000.
And you can tell by the mood of the home’s four bedrooms and three bathrooms, that it’s really pissed about this price. If it weren’t for that damn mudslide and its precarious position, it would have sold for a cold $1.5 million. It does not end there. If you buy this house (and it has drawn some interest), you also have to stabilize a whole hill. How much does that even cost? Repairs on the house alone are expected to be $300,000. The owner feels the price of the unlivable house is justified because “there is only so much real estate on the planet.” Only a NIMBY sees the earth in that very restricted way.
Seattle, look at this sorry situation and think deeply about where we are headed. Housing should never reach the condition of complete madness.
As the national drought in home supply dragged into its 21st straight month, competition among buyers drove prices up once again.
And the fiercest competition was in the Bay Area.
A new report from Redfin shows that 73.7 percent of homes sold above the listing price in the San Jose metropolitan area in June. That was the highest percentage in the nation, followed by the San Francisco metropolitan area (70.6 percent, second highest in the U.S.) and the Oakland metropolitan area (69.8 percent, third highest). They were followed by Seattle (62.3 percent) and Tacoma, Wash., (52.6 percent).
“Every record in market speed and competition that was set in May was broken again in June,” the report stated.
The Redfin report comes two days after the Mercury News reported on a rash of over-asking home sales in Sunnyvale and Cupertino. In the last month, more than 50 homes in those two cities sold for at least $200,000 over the asking price. One modest Cupertino house — 1,046 square feet — sold for $660,000 above its listing price.
According to Redfin, San Jose had the nation’s largest decrease in housing inventory, falling 42.2 percent in June from one year earlier. The second largest year-over-year contraction of the home supply was in Rochester, N.Y., where inventory fell 29.7 percent. The third largest shrinkage happened in San Francisco, where inventory fell 26.6 percent.
With so few homes on the market, the law of supply and demand kicks in — particularly in a region like the Bay Area where the job force continues to expand along with the demand for homes. Inevitably, prices go up.
The nation’s median sale price rose 7.3 percent to $298,000 in June, Redfin reported.
Prospective Bay Area homebuyers paid a lot more. Oakland’s median sale price was $719,500, up 9.8 percent year-over-year. San Jose’s median price was an even $1,000,000, up 11.1 percent. San Francisco’s median price was $1,250,000, up 4.2 percent.
The “fastest” markets in the nation — where sales were struck most rapidly — were Denver, Colo., Portland, Ore., and Seattle, all tied at seven median days on market, followed by Grand Rapids, Mich. (eight days on market), and Boston, Mass. (nine days on market).
Oh, the pain, the pain — and the cost, the cost — of renting a Bay Area apartment.
A luxury condo sold last month in San Francisco’s Russian Hill neighborhood for $4.35 million. It’s a two-bedroom, two-and-a-half-bath, 1,960-square-foot unit lined with walls of windows, mimicking the style of a mid-century Eichler home. Set on the 31st floor at 999 Green Street, with expansive views of the city, the apartment’s cost per square foot is $2,219.
“That means that just one foot of the place is more than you pay in rent for your tiny San Francisco apartment,” wrote Alexa Collins of the Homelight real estate website. “You could probably fit a toaster in that space. Or a corner of your bed.”
The cost per square foot is close to a match for what many people pay for two-bedroom apartments in San Jose, Oakland and other Bay Area cities. According to a June report from ApartmentList.com, which tracks the national apartment market, the median monthly rent for a two-bedroom unit in San Jose was $2,570 last month. In Oakland, it was $2,500.
However, San Francisco is a slightly different story. One might say that the value of two square feet at 999 Green — $4,438 — is more in line with what San Francisco tenants pay for their two-bedroom apartments. According to ApartmentList.com, the median monthly rent for a two-bedroom flat in San Francisco was $4,550 last month.
The Summit on San Francisco’s Russian Hill is influenced by the design of midcentury Eichler homes, which have walls of windows and light-filled interiors. A condominium on the 31st floor of The Summit sold last month for $4.35 million. (Courtesy Alexa Collins, Homelight.com)
(The Green Street condo was sold through Sotheby’s International Realty and its agent Betty Brachman.)
And in case you were wondering about those walls of windows: 999 Green Street is known as The Summit. It is a modern Eichler-style apartment house, described by Collins as “a rectangular skyscraper with a beige central concrete column that divides the building in half. You’ll find resemblance between the facade of Eichler houses and this building in the two walls of windows that make up the four corners of each unit. San Francisco’s elite (who) own property in the mid-century modern … units have sprawling views of the city.”
Developer Joseph L. Eichler built distinctive, mid-century tract homes that create the sense of bringing the outdoors into their flowing, light-filled interiors, lined with windows. In 1949-1974, Eichler — while based in Palo Alto and, later, San Francisco — built 10,500 houses across the region, even entire Eichler neighborhoods, from Walnut Creek to San Jose’s Willow Glen.
This is the floor plan for a luxury condo that sold last month on San Francisco’s Russian Hill for $4.35 million. Each square foot of the unit has a value of $2,219. (Courtesy Alexa Collins/Homelight.com)
