41 Federal: Aerial
Having just recorded its sixth price reduction, the resale list price for 41 Federal #42 has dropped from $939,000 to $869,000 to $850,000 to $830,000 to $813,400 to $797,150 to $781,200 over the course of the past eleven months. It’s now listed at $68,800 (8.1%) under the reduced price that was last being asked by the developer fourteen (14) months ago. And it had better sell soon because we’re running out of images to accompany the updates.
∙ Listing: 41 Federal #42 (1/1.5) – $781,200 [MLS]
Seller Motivated Drastic Price Reduction Penthouse Unit [SocketSite]
And Now We’re Back Below Where We Started [SocketSite]
Going Once, Going Twice…Going Five Times At Shore|Line: 41 Federal [SocketSite]
Savings At Shoreline (41 Federal) [SocketSite]

13 thoughts on “Okay, So The Fifth Time Wasn’t A Charm But Perhaps The Sixth…”
  1. It *is* a dark dungeon. The location of this building is terrible. It’s in a hole in the middle of the block surrounded by taller buildings. The main joke here is that anybody would have paid nearly a million bucks to live in such a hovel in the first place.

  2. If it were an actual penthouse then there would be plenty of light coming in and that dark kitchen might actually make sense. Top floor sounds good, so why not go with the truth? Spa inspired bathrooms means annoying bowl sinks and glass shower doors that are hard if not impossible to keep clean? At least the bathrooms are lighter than the kitchen of doom. The location is great, but $850 for each square foot? Ouch! Good luck with that.

  3. I for one am glad to see these comments. They used to be what I was thinking for many properties that were at $1,000 psf. I also used to feel completely inadequate when so many postings would infer that $1,000 was a good price, specially for the new construction. I looked at the Palms and all those condos along King and Berry, road, the Watermark etc, and was completely floored by the products lack of quality and the price, but people were buying.

  4. This place looks terrible and still seems significantly overpriced.
    I agree that the pictures aren’t doing it any favors. Over 900 sf? Where’s the rest of it?

  5. I dug around in Propertyshark a little, but it’s tough to tell what is exactly going on. It looks like this unit was purchased in late October 2006 for $850K, using 90% financing (2 loans). Does anyone know for sure?
    So, if what I found is right, this owner has just about already evaporated his entire down payment (and whatever closing costs he paid)already, and it looks like more of his wealth (that is, his labor) is about to be fed into the shredder, if he actually digs into his pocket to pay the transfer tax and realtor commission.
    I don’t know this location, but I’ll trust the gist of the comments above that it is STILL overpriced.
    It sounds like in the end, this owner is going to face the prospect of losing about $100K+, or walking away (www.youwalkaway.com) and dinging his credit. Adding in the financing costs that he paid to “rent” the money he used to pay for this palace, when it’s all said and done, he probably evaporated about 6-8 YEARS’ worth of housing expense had he just rented one of the many 1/1.5s we see on craigslist every day. I hope it was worth it for him! (I’m sure he mentioned to all the young ladies he met that he “owns”….)

  6. and with SF being the fetish city it is, I’m sure the ladies were even more impressed that he owned a dark dungeon.
    Satchel by the way does your price fall forecast differ significantly betweeen SFHs and condoos? It seems tome that condos are currently being hit far more than SFHs, at least SFHs in decent locations. $1,000 p/sqf seems ludicrous to me to for these places.

  7. “Satchel by the way does your price fall forecast differ significantly betweeen SFHs and condoos?’
    I don’t want to get too OT on this thread, but Iguess it’s relevant. FWIW, yes, I do think condos will fare differently, and worse, than city and neighborhood averages. I don’t know the condo market in SF very well, or the neighborhoods where they predominate, so I don’t really have specific numbers in mind.
    But in general, it seems like there are three valuation considerations, once you normalize for neighborhood (that is, adjusting for the effect of generalized neighborhood declines).
    First, condos are less desirable in general than SFHs, and so will fall proportionately more in a downturn.
    Second, smaller condos (just like starter homes, BTW) should do worse than larger ones. This is because they are not “terminal” properties. You do not expect to live in a 1/1 or tiny starter SFH for the rest of your life, and raise a family there. Thus, they rely on a greater fool to come along and pay your price. In rising markets, a great number of greater fools can be relied upon, but as a market turns, these fail to show up. This was the pattern in NYC in the early 1990s (1-bedrooms smashed by up to 40-50%!!, while 2-bedrooms only fell 15-25%, and 3 bedroom nice places sometimes hardly at all, although some of those did fall too). We are starting to see this in SF. For instance, 3324 Octavia in a nice part of the Marina is back to its 2004 price (basically) and going lower because it is a 1/1 IMO. I don’t think 2/2 condos in the Marina have fallen that much.
    Last, some neighborhoods will obviously suffer from a supply overhang issue, especially in SOMA, and maybe Van Ness corridor?? Although land in limited in SF, if you build vertically, a lot of supply comes on suddenly, breaking the valuation metric that disctates that in resource constrained cities, supply can only grow slowly. Although I don’t know the areas really well, now that we have seen foreclosures that are back to 2000 prices (246 2nd, for instance), some of those SOMA buildings are just going to be annihilated.

  8. does anyone else think this is still 30% overvalued?
    I think they might start to get a nibble when the proce drops below $600K

  9. All due respect, I am not sure why so many readers seem to have a vested interest in seeing other people have finincial problems related to owning. Justifying their existence, I expect. By the same token, it’d be pretty annoying if I posted stories of every 50-year old renter I knew that had no net worth.
    At the same time as this Federal listing, look at something two blocks away like Watermark 17D (I think) that just sold. Went for $1200 a foot at what, $200k+ above original price from less than two years ago. Not too shabby. Beat the stock markets for that time period.

  10. This isn’t a terrible location at all. I rented at 200 Brannan awhile back and thought it was one of the nicer areas in South Beach. So the condo must look a bit like an uninspired shoebox on the inside. Has anyone here seen it?

  11. anon@7:41PM:
    Since I live in that neighborhood, I’ve been tracking SF Watermark for a while now. My data (and please let me know if you have updated info) shows that Watermark #17D last sold for $1.475 million on 10/23/2006. Since then, I’ve seen it offered for sale at

    • $1.649 million on 8/20/2007
    • $1.599 million on 9/25/2007
    • $1.549 million on 11/30/2007
    • $1.525 million on 12/03/2007

    I then failed to find it listed for sale or rent, so I speculate that perhaps it was either rented out or the owner decided not to sell.
    BTW, I have been maintaining similar info on every available Watermark unit for almost two years now, mainly since I perceive it to be a microcosm of the SF housing market. Adam asked me to send him this info at the last SocketSite gathering, but I got no response when I emailed it in, so perhaps he didn’t perceive it to be useful. 😉

  12. Great to see that this property (41 Federal #42) is going to be auctioned off!! The auction is this Wednesday, March 26:
    This auction should be interesting to watch and another data point in the “apples-to-apples” comps that we look at.
    I say it will go for ~$595K, 30% off the original purchase price from the developer.
    (The auction was originally noticed by another eagle eyed commenter, GoodBuyBadTimes, in a superseded thread on this 41 Federal fiasco.)

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