Brian
Posts:4665
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| 05/13/2009 11:04 PM |
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Some people claim that this real estate is different that the crash of the 1990s.
I think that the only different is the order of magnitude.
Let's post examples here are they pop up.
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Brian
Posts:4665
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| 05/13/2009 11:09 PM |
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<a target="_blank" href="http://www.sdlookup.com/Property-65A56046-7988_Mission_Center_Ct_G_San_Diego_CA_92108">
7988_Mission_Center_Ct_G_San_Diego_CA_92108</a>
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Brian
Posts:4665
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MWtoSD
Posts:1085
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| 05/15/2009 6:49 PM |
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pending MLS-090022157
428 33rd
Location: San Diego > Golden Hill
Zoning: Multiple Residential
Use: Single Family Residential
Parcel Number: 5452310200
Square Feet: n/a
Bedrooms: n/a
Bathrooms: n/a
Tax Assesment
Land Value: $49,190
Improvement Value: $65,824
Net Value: $115,014
Est Property Tax: $1,438
Sales History
Date Price Held Return Annual
07/06/1999 $94,000 4m 88% 523%
03/02/1999 $50,000 5y 4m -37% -8%
10/28/1993 $79,900 5y 62% 10%
10/13/1988 $49,400 8m -23% -30%
01/20/1988 $64,000 n/a - -
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Brian
Posts:4665
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wilson
Posts:1713
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| 05/15/2009 7:35 PM |
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I don't believe a Villa Portofino 1 bedroom went for $283k in 1989.
must be a typo. |
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Eugene
Posts:747
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| 05/15/2009 9:05 PM |
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Some people claim that this real estate is different that the crash of the 1990s.
I think that the only different is the order of magnitude.
The ultimate straw man? |
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ElPato
Posts:576
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| 05/16/2009 8:02 AM |
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The Plaza in PB is a classic example of the boom and bust that San Diego Real Estate endures. 1BR condos are a great educational tool.
Unit 311 is a <a href="http://www.sdlookup.com/Property-9FEBFBEA-1775_Diamond_St_311_San_Diego_CA_92109">classic example</a>. In 1993 this sold for $90K. 10 years earlier it sold for $100K, so someone lost $10K after 10 years.
And then the boom began anew. In 2003, it sold for $230K, then in $2005, for $330K. This $100K increase was more than the entire unit sold for 10 years earlier.
And in 2009, we are back to $230K.
In my opinion, we will see this boom fully unwound before we are done here, so this unit will be back to an inflation adjusted $90K.
The attached PDF shows the price swings over the last 25 years or so at this unit, but there are dozens of more examples if you care to look.
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Attachment: plaza.pdf
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Brian
Posts:4665
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| 05/16/2009 9:55 AM |
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Very interesting, El Pato.
There's some things wrong w/ SDLookup. If you post an attachment, then the html doesn't work.
Would be interesting to see a return to 90k. If that happens, then even the peak buyers with the most wherewithal will be totally wiped out, many times over (in terms of their equity), and will be left with no option but to walk.
classic example at the plaza
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wilson
Posts:1713
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| 05/16/2009 12:25 PM |
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Bran,
There is always an option to walking away: stay and pay according to your contract.
(as distasteful as you seem to think that is) |
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Brian
Posts:4665
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| 05/16/2009 4:01 PM |
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wilson, assuming prices drop back to $90k at the Plaza and then increase to at 2% per year.
Would the peak buyers there be "fine" over the long run to keep on paying according to the contract? It depends on what "fine" means.
Let's assume that some of the peak buyers at The Plaza bought personal residences that they could afford at 1/3 of income. By "paying according to the contract" they'd be "enjoying" a lower and stagnating standard of living for decades. I guess it's their choice what they want to commit themselves to.
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wilson
Posts:1713
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| 05/16/2009 9:42 PM |
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| Yes, some people will hold on and pay despite negative equity. Just like some people who should have sold rental proprty have continued to own despite missing out on the selling opportunity of a lifetime at the peak. |
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Brian
Posts:4665
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| 05/16/2009 11:22 PM |
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Wilson, either way, better to have lots of time to recover....
Don' t you have a property to sell before buying your retirement condo in SD soon?
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wilson
Posts:1713
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| 05/17/2009 12:17 AM |
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Yes, I hope to sell my house this summer if I get some projects finished.
At the risk of disclosing my location, zillow indicates prices in my city have increased over 4% in the last year. I think they have been flat, though. My tax assessment did tick up a little in the last year. I LIVE IN AN AREA THAT IS IMMUNE!!!!!!
Not immune, but I expect to sell at near peak value since I purchased in the 1990s. I expect to have lots of downside price protection with my SD purchase. |
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Happy Owner
Posts:153
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| 05/17/2009 2:15 PM |
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Brian, tell me again why everyone who may have bought at peak will have to walk away, regardless of their wherewithal. I am not following this logic.
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Brian
Posts:4665
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| 05/17/2009 4:59 PM |
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Wilson, lucky you... Your city in immune so you can sell near the top and buy at lower prices in San Diego. I'm happy for you. :)
Happy Owner, I think that if prices drop drastically like they are happening at some complexes like The Plaza, the only palatable option is to walk away. Wherewithal to keep on making the payments is one thing. But the desire and incentive to do so are something else. In most cases, the desire to buy a the peak was based on the expectation to sell at handsome profits in a couple years.
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wilson
Posts:1713
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| 05/17/2009 7:57 PM |
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Brian,
I might consider myself prescient if I believed in that crap. I do believe it is important to stay informed, make the best decisions you can, and make course corrections as necessary. I think both you and I saw a dislocation in the economy coming in general terms. I don't for a second believe anyone has a crystal ball that foretold the depth and timing of this. Given the number of economic experts out there, odds are that a few would predict it corrrectly and I think they were lucky. I don't look to tham as the expert and hang on their every word. I prefer to think for myself. I think some would have indicated that Buffett is (was) prescient as an investor. I think he is very talented but when the rules change, the same old processes might not work. I am lucky but there is more to than that. I sold my rental properties a couple of years ago.
The guy who wrote the article reminds me a little of a gambler who needs to keep on betting hoping his luck changes and he can win back what he had lost. His last shot is making a killing on his book.
Rather than uproot a family, I think that many, many people will hold on and stick it out as long as they can make payments and wait for things to recover. In most real estate markets in the US, that might not take many years as it might in CA. There are plenty of people holding onto stocks that have decreased in value waiting for a recovery. It is human nature to expect that values will return to what they were. |
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dchestney
Posts:1268
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| 05/17/2009 8:11 PM |
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[quote]Posted By Brian on 05/17/2009 4:59 PM
In most cases, the desire to buy a the peak was based on the expectation to sell at handsome profits in a couple years.
[/quote]
I doubt you have a clue about what motivates/motivated purchases "in most cases," and I suspect most people who bought at or near "the preak" didn't know/believe it was a peak--thus no "desire to buy at a peak." Surely many of them bought because they wanted to own a place to live in. Some will reconsider, but how many are left to do that after the "weak" owners who sustained market price decreases in the past two years have already exited? Surely some; surely not most. The best evidence that large numbers of people do not act as you apparently would is the 3,000+ in SD County who purchase a home each month.
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Happy Owner
Posts:153
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| 05/17/2009 9:13 PM |
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Brian---I have to dispute what you are stating. Your "opinion" is that anyone who bought at or near peak will walk away. You also assume that these buyers will not be incented to continue making payments.
Some of us who bought at or near peak own our homes outright and are not concerned with monthly payments. Some of us are also not interested in selling in a couple of years at a handsome profit. Some of us intend to live in our homes for the long term. Why would I walk away from a home that I love, that is in an ideal location for me and is a home that I owe nothing on?
Your assumptions are not always flawless. |
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jpinpb
Posts:4538
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| 05/17/2009 9:22 PM |
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| I am across this one in Golden Hill. 1530 30th. Quite a history. |
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