While the sales office at One Rincon Hill has reported great success in reselling cancelled contracts (as well as increased prices), with at least twenty five units now available for sale or assignment outside of the sales office, the true secondary market for units at One Rincon Hill is still trying to find its way.
In additional to the seven units pictured above (which was posted to Craigslist and passed along by a plugged in tipster), five units are currently listed for sale on the MLS (two of which have recently reduced their pricing expectations), and at least another thirteen are being offered for sale/assignment on Craigslist (nine of which are seeking assignments at their contract price while at least two are willing to take a loss and assign for less).
UPDATE: One reader asks, another answers: a first-hand account from a happy assignee.
∙ $1000000 High Floor One Rincon Hill Units Available Assignments [Craigslist]
lol. If I had the attention span, I’d love to go back and repost all the comments from the cheerleaders that swore this would never happen to 1RH.
Interesting that I haven’t very much of what I am assuming is speculative investment at The Infinity. On Craigslist I only see 1 unit offered for sale.
I do believe that there has been much less speculation at the Infinity but I also know that their sales office has been much more vigilant in tracking down and threatening people with their no-flip clause.
[Editor’s Note: And with that, let’s try to focus on One Rincon (or at the very least secondary markets). And if you can’t, an editor will be happy to help you out…]
In the last several months, we’ve seen a ton of offers to have someone take an ORH contract over, but has anyone actually done so? If anyone has, or knows someone who has, would you mind explaining the rationale?
I’m looking to sell my condo in the Marina as my wife and I need more space with our kids. We’re not sure if we will move to Marin or the East Bay but the price and quality of the Infinity or Rincon rental is right… and this market is about to get flooded, so rental prices should come down all the more for these units.
Suckers who bought them, it’s FL all over again.
I’m almost certian all these units were purchased as investments. I only say that because Paul has been toating these units in his ads from day one. those poor millionaires that purchased thinking they could make a profit on a flip are surly sorry now. 1RH has a lot of explaining to do to residents who are actually living there. I dont think there is a single unit that has appreciated since deposits were put down in 06. If anything, people looking to “get out” are going to loose their ass. Literally. And by the way when Hwang says these units are in escrow, thats BS, because according to my sources nothing above the 40th floor is even close to closing till early summer. Why even continue with the second tower. It will make even less than the first. Those of you thinking the Infinity isn’t having this problem are wrong, just like someone mentioned their sales office is cracking the whip, MUCH harder! And look at the amount of rentals at both properties!
OK. Let’s play the time machine game.
See this thread:
https://socketsite.com/archives/2007/10/one_rincon_hill_an_official_update_and_a_few_confirmed_1.html
And look no further than the first post.
(and yes, I do have a life, but I also have quick fingers)
Oh, and that thread too is hilarious.
https://socketsite.com/archives/2006/06/first_impressio.html
Nothing like a small trip to mid-2006 to let us pause and reflect to where this market is currently going.
1RH has a lot of explaining to do to residents who are actually living there.
why? when my friends put down their deposit they were told that flat out by the sales staff that there would be a lot of “second home buyers” and “investors”.
at the time, it was touted as a good thing, with the rationale being that mainly rich investors and second homeowners would live there, making ORH a playpen for the rich and famous. I tried to explain to my friends that you want to be in a tower where the occupants are primary owners, but they liked the idea of having the tower “all to themselves”
I think ORH would only have to do some explaining if they promised that there wouldn’t be a lot of speculator interest in the building… to my knowledge they did not promise this at all.
Lastly, anyone remember how many units are in the complex? 25 people looking to get out of the tower… this is out of how many?
I like how Socketsite runs this topic right before Memorial Day and the Spring – Summer selling season starts in earnest. Its almost like they are trying manipulate the market into avoiding Rincon Hill…
[Editor’s Note: You have got to be kidding.]
Trip,
We purchased in mid-February, and the following was our rationale –
We came across a party that had put down a 3% deposit at 2006 pre-construction rates at ORH Tower I, but come the time for closing [2/2008]his financial situation had changed, and he was no longer able to consumate the transaction. I imagine this may be the case for a large number of these 25 units – overzealous investors that couldn’t really afford these units in the first place … and certainly can’t when banks require 10%+ down and are increasingly strict with earnings/asset information, as they probably should have been all along.
In our scenario the original ‘buyer’ wanted to get his deposit back [and understood that if he failed to close, he would lose it] and we wanted to avail of his favorable price. As a result, he had something that we wanted [price] and he wanted something from us … a return of his deposit. Accordingly, the transaction made sense to us.
Our purchase price was around $725 per sq. ft, which includes about $17k worth of upgrades. We have a 2/2 with unobstructed east and southern panoramas.
ex-SFer – I believe there are around 350 units in the tower, so these 25 represent about 7% of the total. Still I admit that this ‘secondary market’ doesn’t look good and I believe that the Infinity has likely managed similar scenarios far better than has ORH.
San Fronzischeme’s links are a real education. Someone said in one post that 1RH was better than 2006 Washington! What were they smoking-drinking-taking? The hysteria of 2006 seems insane looking backwards from today.
you’ve got to be kidding me! ORH has been in/famous from the start. I highly doubt someone is going to change their mind about buying in ORH based on this website (sorry socketsite… you’re influential and all, but not that influential)
If there is a nefarious purpose to putting ORH or infinity on Memorial Day weekend it would be more that topics about those 2 towers tend to “live” longer than other topics. the only topics I can think about off the top of my head that live longer are those about
-whether or not you need a car in SF
-NIMBYism
-city politicians
besides, memorial day weekend doesn’t even start till tomorrow evening… we’ll be far beyond this topic by then…
ROFL
Good one Fonzi!
Incredirent,
I imagine Socketsite’s power to move markets–even the San Francisco luxury condo market–is rather limited. Maybe you’re blaming the bearers of bad news and all that. In denial?
I just took a second look at their website, something I had never really done. The large towhomes are quite nice. The sky levels right under the penthouses facing southeast have really nice floorplans and I’m sure are incredible units. I’d jump at a chance at one of those if I could afford it.
I have helped with some of these “assignments” and they are a win – win situation as Recent ORH has stated. I wonder why so many like to bash Rincon, yet how many have been up in the tower and seen the incredible views? You can see the Ocean, Marin headlands and Alcatraz from many of the higher floors, and even down into the ballpark. Photos don’t do justice to the real thing.
The most common expression when someone walks into my unit and looks out the windows is a simple “Wow”, and then they stand there for about 15 minutes staring. I have heard the sales office may start doing hard hat tours, if so, this would really help the buyers and public to see what it’s all about. It’s certainly not for everyone, but if you’re into views, its the place to be.
btw – 376 units in the tower and 14 townhomes.
Full disclosure – I also have a few clients considering assignment!
I dont care about ORH one way or the other, but the volume of flips on the hwang site is a really bad sign for the developer hoping to close out his actual sales here.
and for making whatever thresholds he need to start phase 2.
most anyone but a resident is probably going to just drop their deals, as they will be out a lot more than 3% over the next year of negative carry.
ps from brokers it sounds like the infinity has passed orh on closing volumne even tho orh started earlier.
This pic is from the 23rd floor of One Rincon Hill:
http://www.skyboxrealty.com/images/425_1ST_VIEW1.jpg
I think it was last Thursday, the first day it was hot and remember thinking, “That is a damn beautiful sunset.”
Some would argue it is not and I would respectfully disagree.
Now that’s a pretty picture Paul.
But what is the building in the center just behind the sailor’s union of the pacific?
THAT’S a nice building where I could see myself living.
Ozzie,
Thanks for the exact number [376 units] so the 25 here in question are less than 6.6% of the overall total, so it’s hardly the stampede for the exits that some would like to portray. Moreover, with 100 units already closed and 80 moved in during the first ‘wave’, it’s not quite the doom and gloom scenario that the naysayers predicted.
As I’ve said, I believe most of these 25 may be investors/speculators that may have been looking to make a quick buck. I can’t say I’m disappointed that things haven’t worked out for them. If these 25 are replaced by people that legitimately are looking to live there, either full or part time, this will be positive for existing owners. I know, whether this happens remains to be seen, but the more flippers that are weeded out, the better, IMO. Either way, these are still a small portion of the overall picture.
I’m certainly biased, but I believe there is still much to look forward to with ORH. Once Caltrans finally completes their task [‘cleaning out’ the area bordering bridge & onramp] the 70+ trees that will line the ‘driveway’ will be a huge positive. And Bovis, let’s get done with that pool already – it would have been great to be out there last weekend. And those townhomes too … once done, they will greatly improve the facade from Harrison Street. Trees planned for Harrison too, I believe.
I agree with Recent OHR buyer. taking over a contract from someone looking to transfer at ORH makes a lot of sense. I came very close to taking over a unit myself. If you find someone looking to transfer an early unit, you can get as low as 730-800 per square foot, depending on the floor, for a great 2bdr 02 stack. Those are great prices, assuming you can hold in the mid-long term and don’t have to worry about what will happen over the next 2 years in the soma condo market.
It’s a great building, and taking over early pricing makes great sense.
Ultimately the timing didn’t work for quite right for me. I would have had to sell my current home immediately in order to move on this, and that just created too much pressure.
I recently did a hard-hat walk through at the unit that I am going to get. I have not changed my mind since the day I put in my deposit, but I did have a difficult time in securing a loan even with 50% down, and that’s probably why we see a lot of contract assignments these days. The view from my unit is spectacular, and I like ORH’s front lobby many times better than the Inifnity’s.
My how things change in a year:
“Having represented 16 Buyers at One Rincon Hill, I can tell you that none of my buyers intend to back out of the contracts they are in.
Before I get flamed, I am just giving out the above simple fact. I am not trying to sell anything, I am not making any representations about One Rincon Hill, I am not making any predictions, and I am not trying to speak to you directly through this blog. Take a chill pill before you flame me.”
Posted by: Paul Hwang at August 22, 2007 11:45 AM
https://socketsite.com/archives/2007/08/one_rincon_hill_an_unofficial_update_on_the_two_towers.html
whoa, 50% down even with early contract pricing (assumption given deposit)? Why so much, are the lenders that skeptical about this building?
“If you find someone looking to transfer an early unit, you can get as low as 730-800 per square foot, depending on the floor, for a great 2bdr 02 stack. Those are great prices, assuming you can hold in the mid-long term…”
I almost made that mistake too. PB, just wait another 12 months…those newly revised low prices will seem high.
Recent ORH — thanks for sharing your thinking. It sounds like you really like your place, and at the end of the day that is far more important than a few dollars per square foot in one direction or the other.
For others thinking about this move, there are a number of ORH places for rent right now for far less than it would cost to buy. It does not appear that it will be difficult to find places in this building in the near future. It may make sense to try it out by renting at a steep discount, and if you want to buy, wait a bit and see if prices fall. They may or may not fall significantly, but it is hard to imagine a scenario where prices go up any time soon, so there is no downside to holding off.
Trip makes perfect sense. You can easily rent at ORH at a substantial discount over buying. Taking a look at Craigslist, you can probably negotiate a pretty sweet deal renting from a desparate investor for a year or two. There’s really no reason to buy when prices are declining or at best flat lining.
Looking at Zip Realty, I already see unit #2403 reduce a 100k off their asking price (1.3M to 1.2M). I saw this unit, the views are incredible, but no one is buying right now. All the smart buyers are waiting on the sidelines to see how far prices will drop. In this type of market, there’s inherent risk in buying in the building full of investors, but near zero risk of renting…
Trip,
Your perception about the costs of ownership are commonplace, but not always entirely accurate. I can’t speak for everyone, but I will highlight our example. Looking on Craiglist, the LOWEST priced 2/2 with our configuration at ORH is $4500. Our total monthly costs, including mortgage, property taxes, condo fees and homeowners insurance are about $1000-1500 higher than the aforementioned sum. If I were to figure in the tax deductions we are getting for interest and property taxes [which is the vast majority of what we are paying] I’m sure you would agree that that ‘differential’ would come down.
However, let’s figure the ‘excess cost’ of buying versus renting at ORH [for us] is about $1000 per month. That’s $12000 per year. We don’t see ourselves going anywhere for a minimum of three years, so that’s a $36000 differential over three years, assuming all variables stay the same. $36K represents a 4% appreciation in our unit over three years, or about 1.3% per year. Yes, I know, there’s selling commissions and other things to consider [Note – we won’t be paying anyone 6%, even if we have to go FSBO] but we feel pretty comfortable that over a 3 year period, we will comfortably cover our carrying costs … and then some.
I don’t know exactly what the South Beach condo market will look like in 3 years time, and neither to any of the prognosticators on SS, despite lofty claims to the contrary. With oil likely to hit $150 a barrel this summer [the price of oil is one of few predications Goldman Sachs has been right about] and commodities/materials ever more scarce as China and India build out their infrastructures, it’s certainly not getting any cheaper to build. I feel pretty good about our purchase, both as a financial decision and in terms of the pride of ownership.
@ Recent ORH
The renter could make even more money investing a potential downpayment in bonds or bond ETF’s while renting for 3 years. You are also assuming that money saved accrues no interest.
All I’m saying is why take on the risk of price reductions when there is the obvious risk-free alternative of renting the same place for less? Recent ORH, you recognize the very high transaction costs you would incur if you sold — they would more than wipe out the appreciation you are positing. But what if prices decline by just 10%? What if it is 20%, or more? That would be a massive financial hit, and right now it seems pretty clear that the likelihood of price declines in the SOMA condo market is far greater than the likelihood of appreciation over the next few years.
If there were no rentals available, then this would be a far more complex decision. But with the same layouts available for rent in the same building for far less than buying, it just seems to make sense to leave the risk with those who bought at the peak and rent from them.
Unearthly,
I have a small stake in a money management firm that run ETF only strategies, so I’m pretty well aware of the non R.E. investment options. Let’s not forget that months ago, people were talking about opportunity costs of 8-10% per annum in the equity markets. The S&P 500 started the year at 1475 and closed today at 1375, relecting a loss of -6.6% year to date. [For those that care, our flagship strategy is up just under 1% year to date]. Now all of a sudden people are talking about bond ETFs like they they would have had the insight to avoid U.S. equities entirely … pretty amusing cherrypicking really. And what happens to those bond ETFs when inflation forces rates to rise again … ooops.
Note that your point also assumes that someone that forgoes a home downpayment is disciplined enough not to spend an extra penny [on a car for example] and to invest it all. Usually doesn’t work that way in reality.
Trip,
Thanks for the revelation that if prices go down I stand to lose money. So I guess if I buy google today and it goes down to 450 and I sell, I will lose money. I guess that’s how finance works. Remarkable.
Note to self – when someone uses the words “obvious” and “risk free” when trying to predict the direction of any market, please be nice and try not to call him a complete moron straight away. When he asks inane questions like if X goes down, won’t I lose money, just let it go. Oops … too late.
Happy Memorial Day weekend everyone.
Like I said on another thread, given the far greater costs of buying a SOMA condo in this market as compared to renting an identical place, the only justification for buying is the expectation of very significant appreciation. I guess I’m just a moron, and a complete one at that (of course, my being a moron does not change the fact that renting is an obvious risk-free alternative to buying regardless of market direction since one completely avoids potential losses from price declines (while also missing out on any appreciation)).
Good luck with your long position. I hope it works out for you.
I sold 2 properties in 05/06 (one primary, one investment) and instead of going the 1031 route for the investment, I put the cash into good use buying technology stocks and shorting the home builders. I know little about ETF strategies, options and all (call me old fashion), but since late 06, I’m up 50% investing cash I otherwise would have use as down payment or deposit to buy real estate. I know a lot of people aren’t as discipline as me (buying cars, jewelry, etc…), but I’m SOOOOOO glad I didn’t use this cash as deposit or downpayment for a speculative condo development or that 40% gain would have been nothing but a pipe dream.
For those that put down 200-300k down payment on these condos, their investment won’t be an appreciating asset for years and years, and in worse case scenarios they will lose tens, if not hundreds of thousands of dollars.
I’m renting now, my cash is safely in a money market account gaining 5%. I hope to buy again very soon (I would even consider ORH, a high floor unit), but not until prices drop another 15%.
Recent ORH buyer, I’m glad you’re happy with your unit. You got a good price, but I do wonder sometimes how the other 100 or so ORH buyers that paid $900-1200/sqft for their units are feeling about their investment right now….
A totally different thought(or may be related since we are talking about financial investment):
I was always puzzled why I was looking to buy a 2 bedroom place when I am comfortable renting 1 bedroom.
For example, my friend moved to east bay and bought a 4 bedroom home. He is married but doesn’t have kids and not hoping to have anytime soon. Now, he is paying around 4000$/month for everything. He always tells me that it would cost 3000$/month to rent that place anyway. I wondered why he would even think of renting a 4 bedroom home????
So, is it false justfication that makes us happy? When I was looking to buy, that was my thinking too ( I would spend 2.5-3K for a 2 bedroom anyway..), but in reality I don’t need it for another 3-4 years….
Will be glad to hear from others..
Geez, Recent ORH buyer, if you’re going to make a rude comment, you should at least make sure you don’t get your point completely backwards!
Recent ORH buyer has a history of making offensive and rude comments so whatever he says has to be taken with a grain of salt.
Trip, Missionbay res and others makes valid points. Unless you don’t like to move and plan on living in your home for 5-10 years, there’s no reason to buy a speculative condo in this marketplace, especially one with so many investors and renters. Looking to the future, there will be thousands of new units going up in Soma/downtown area. I would wait till things shake out before committing hundreds of thousands, especially in a shaky market.
I own in the peninsula, have lived here for 10 years. I’d like to buy in a highrise if anything just for the great views and amenities. But I’m also patient and will wait for more reductions before I jump in.
The picture is gorgeous. However, I would like a clarification: is the sky photoshopped in?
I know that the views for ORH will look like this on a spectacular evening. However, when I downloaded the picture it came up magnified like 800% or something, and I could see a bright line across the top of all the buildings where they meet the sky.
on a side note, I am THE biggest loser right now. I’m sitting in an apartment in Paris right now reading socketsite. (I’m waiting for everybody to get ready for dinner and they’re taking a long time)
my best wishes to you all on memorial day, most of all to those who are serving in hostile lands, away from family/loved ones
I don’t see how anyone can argue that the dropoff rate is significant given the incredibly difficult credit environment we are in. As someone noted, even w/ 50% down it is very difficult to get a loan right now. Given that situation, I’m surprised anyone is closing at ORH or anywhere else.
If the # is close to 7% then it seems ORH is ahead of the curve.
ex SF-er,
Anybody that was in San Francisco at sunset the first day it was hot, two Thursdays ago saw this sunset. I had my photographer taking pics of the Bay Bridge (http://www.skyboxrealty.com/images/425_1st_livingrm1.jpg) for my new listing (One Rincon Hill #2307)
When I was watching the sunset, I grabbed him and told him to stop what he was doing and take a picture of the sky.
He does touch up the photos for me, but the sky is not cut in. That’s the way it looked. I’m sure there are tons of other people who saw it too.
I concur with Paul. This photo looks straight. Those funny lines between the skyline and the sky might be a result of combining two or more different exposures (HDR). Yeah, that’s doctoring the photo but in my opinion actually brings the photo a lot closer to what we perceive with our eyes.
Good job on the directing your lensman Paul !
I dont’ understand why anyone would question the photo as being manipulated. Do realtors have that bad of a reputation?
The last builing on the right has the reflections of the clouds, it would take one hell of a photoshop expert to really make that happen, the colors on the street are also reflections of the light in the sky and clouds.
The wide angle lens is the problem that I have will all real estate related photos, they simply dramatize the space, and in this case, the skyline.
Finally, while the sunset is quite beautiful, it’s not uncommon out here. I’ve seen some of the most spectacular sunsets out here.
@Viewlover,
Yes, unfortunately realtors do have that bad of a reputation.
I particularly love it when renderings of a SFR remove the neighboring houses that butt right up against it but are miraculously removed from the rendering to appear as though the lot is huge and the house is the only one on the block! LOL
That is 100% real photograph. I remember the sky that evening. We get a few skies like that throughout the year. Absolutely beautiful. Paul- just dismiss the ORH haters. They can stay in their landfilled Cow Hollow homes, but I hope they bought EQ insurance and read their premiums !
Paul’s a good guy and that photo is real.
BUT, not all realtors are the same, which is why there’s always some suspicion:
https://socketsite.com/archives/2008/03/file_this_one_under_the_headline_what_were_they_thinkin.html
For those that think ORH is holding its values and pricing, why are some of the craigslist ads offering prices at BELOW their 2006 contract price? I have seen several of these recently for both 1 bed and 2 bed units. And these postings keep growing in my estimation.
viewlover
1) I’m not an ORH hater. far from it. read some of my old posts. I hope that it does well. I have 2 big goals for SF: to add more housing stock and to add more trees. ORH passes both of those tests actually.
2) yes, many many many many photos are photoshopped. As in my original comment, I acknowledge that the view WILL look like that on certain evenings. I was only wondering if the picture was real, due to the aberration I see when I download it. (it must be some french internet connection thing because it blows way up when I download the pic, and you see this bright white line along the top of the buildings)
as for why I would ask this question: look at some of the pics we’ve been shown. I went to an open house where there was a PHOTO of the house, and it looked like it had a big yard (relatively speaking). That’s because the realtor photoshopped a yard in. and there was the infamous “tilting street” photo we all saw here on Socketsite (where they flattened the street)
and it’s not uncommon to see blue sky photoshopped in as well. I don’t worry about it because the houses can and do intermittently look like that.
Back to the pic though… it is gorgeous. should make a postcard out of that one.
and yes, posting again. It’s POURING outside and so we’re having downtime after lunch.
Paul,
Great photo, and that’s from someone who actually prefers the views from the other side of ORH overlooking the Bay, to the East and the South. Either way, yours was taken from the 23rd floor, and there are 27 floors above that, and the view sure doesn’t get any worse the higher one goes.
Trip,
Unless you work for Bear Stearns’ risk management division, the only asset I am aware of that is “obvious[ly] risk free” is the 90 day treasury, backed by the full faith and credit of the U.S. government. Renting at ORH over a three year period is far from risk free. Why? Guess what, there is a chance your landlord will increase your rent, perhaps substanitally. There is a chance the landlord will decide not to renew the lease. At that point you are faced with relocation costs and the possibility that you may not get the same/similar unit at the same price. Landlord may decide to sell/evict … I could go on. Either way, to say renting over a 3 year period at ORH is “obvious[ly] risk free” is simply absurd. Now I do understand that when you buy you have a substantial amount of capital at risk [thanks for that stunning revelation] but clearly buyers make an informed decision that it is worth their while to do so.
I have highlighted that the difference between renting and buying for myself [I understand not everyone has the same metrics] is $36000 over three years. Clearly I believe a 4% appreciation in my unit over 3 years is more than likely … if I didn’t think it would appreciate considerably more than 1.3% per annum, I wouldn’t have bought accordingly. I realise that renters are hoping for a 10-20% downturn and I suppose there may be certain units in certain developments where that may occur. However I believe we have purchased in the right building at the right price, and this will definitely help our metrics in years to come. I’m not going to predict an exact price or specific appreciation percentage in three years time, as there is a 95% chance I’ll be wrong … and that’s true of almost all multi year price predictions.
dg,
You ask a good question about the below contract prices at ORH. What you must remember about almost all of these are that the ‘sellers’ tend to be people that don’t actually own the unit, and only have a deposit at stake.
As an example, let’s say someone put down a 3% deposit [30K] on a $1m unit. Come time for closing, this party is unable to secure financing, for a host of reasons, the most common being that while he was able to qualify for financing in 2006, he no longer qualifies in the tighter lending environment of 2008. If he doesn’t close, he loses the entire 30K and ORH gets to resell the property. So, let’s say he offers to sell at a “below contract price” of $990,000. What it means is that he is offering to forgo $10K, such that the ‘buyer’ only need to return to him 20K of his $30K deposit. Why do so? Because geting $20K of your deposit back is better than $0K.
FYI – Contrary to popular belief, these ORH units where buyers are defaulting are being resold at higher rates than the 2006 pre-construction prices … not hundreds of dollars per square foot higher, but higher prices. In February/March a defaulting 2/2 on our floor sold at $90K higher than our purchase price.
ex-sf, I don’t believe I said anything about a rincon hater, I went back and looked at my postings and could not find that. Sorry if I offended, I usually like your posts.
I like that building myself, but some of the issues with it cannot be overlooked. My other post asked if there was any kind of confidence issues with the lenders since a 50% down-payment was required. That could only be if the unit is appraising for less an the excess 30% is going towards that issue.
I also know that wide-angle shots tend to show the entire room, but the distortion is terrible. I just saw a new listing down the street and it was very small, but looking at the pics, it looks palatial.
Too bad that photoshop enters the equation, that is pretty decieving, it should be illegal. So many realtors keep mentioning complete disclosure and feel burdened by having to disclose everything so that they won’t be sued. Then they go on to do these shanigans and wonder why most of them have the reputation that they have, unfairly of course.
Hm, so Socketsite gives free advertising for Paul Hwang now? Interesting.
My other post asked if there was any kind of confidence issues with the lenders since a 50% down-payment was required. That could only be if the unit is appraising for less an the excess 30% is going towards that issue.
I’ve got to agree with this. Having recently closed a loan for a new construction condo, I can tell you that for people with a good income, high credit score and a healthy (>20%) deposit, it’s not that hard to get a loan these days. This tells me that either the lenders are getting scared off on this building or the person looking to get the loan can’t really afford it.
Also, I believe some banks generally don’t want to be overexposed to a particular building and will stop writing loans on it if they’ve already written a large number of loans (this isn’t ORH-specific).
*incredirent* said that you got it at $725 / sq ft.
Firstly, well done, great buy!
second, is that an 03 plan?
Third, does anyone know anyone willing to split with a unit at that price today???
Recent ORH buyer,
Thanks for the response. And while I do understand how the deposit/reservation process works, and that it comes down to being able to actually close the deal at the end, why are not people jumping on these at 2006 prices (and sometimes a little under)? Why do they keep reappearing on CL? Especially if the sales center are selling them for even more as you mentioned? Are people just not that resourceful or aware of CL and what is going on? It is quite obvious many will not be able to close as the 2006 lending environment is long gone as we all know.
And did I read back somewhere awhile ago that you got your 2bd/2ba for less than 800/sq ft on a “reassignment” deal?
Hell, I would even buy for that price probably!
Dg,
Yes, believe it or not, we actually found our “reassignment” on Craigslist in mid-January, albeit for one of the lower floors. Yes, you are correct about the price point and we are pleased with the purchase.
You ask a fair question about the reassignments and why “people [are not] jumping on these?”. Obviously I can’t speak with certainty about other people’s thinking, but I will share my own thoughts.
First – People that may want to avail of these opportunities, may not be able to come up with financing … or sell their current homes off in time [at a price that they deem sufficient] to qualify for a primary residence loan. Those needing 50% down may have that type of capital requirement for a second home. Also, there’s typically a pretty quick turn around time on these types of transactions – we had one month from the time of initial interest, to working with an attorney, to securing financing, to closing. Lots of decisions to make and things to get done in a short period of time. Previously we were renters, so we didn’t have any home to resell.
Second – Given that pre-construction prices are designed to represent a discount to ‘actual value’ the sales office perhaps feels justified in marking up the units. In addition, they may feel that mark-ups are closer to prices in similarly situated buildings, like the Infinity and the Brannan. The sales office may also a longer time frame to resell these properties [they have already secured 3% of ‘defaulting’ properties] and can afford to wait. Those looking for assignments may have tried a number of financing options [and failed] and now have a matter of weeks to sink or swim … in terms of recovering their deposits.
Third – The lowest units generally closed first, so as one goes higher in the building, the costs per square foot naturally rise. I believe cost per sqare foot for 2/2 “assignment” units in the 25-30 floor range are 900-950 per sq. ft. While this is not bargain basement, remember that G-money [with the ‘over the top’ interiors, profiled in an earlier thread] paid over $2000 per sq. ft. for his 30 something floor penthouse at the Infinity. Accordingly, price points of current “assignments” may be a concern.
I hope that helps.