The unit number isn’t identified on the MLS, but it’s 501 Beale #12G. Purchased for $975,000 in May of 2006, the two bedroom and two bath Watermark condo was listed as a short sale for “$500,000” yesterday.
Expect a couple of competing offers, an “over asking” sale (assuming the bank even agrees), and perhaps a grumpy neighbor or two above and below.
∙ Listing: 501 Beale #12G (2/2) 1,032 sqft – $500,000 [MLS]
What’s Up With The Watermark “G”s? [SocketSite]

26 thoughts on “Oh Geez, Watermark (501 Beale) Number 12G Returns As A Short Sale”
  1. Nope, its 12D. No balcony, but a decent deal at $500k. I know of at least one owner in that building who had financial issues and is (or already did) unload at a loss.

  2. The SOMA condo massacre continues. Watermark is one of the higher end buildings, now off 50% from the peak at $484 per sq ft. How many others at Watermark are going to be forced to sell,default/foreclose/walk away in the next few yrs?? This does not bode well for the SF condo bubbleonians, they better hope for hyperinflation. If we have deflation, you could see some of the condos in SF like the Beacon go close to $0, as many are forced to walk away/default and HOA’s skyrocket, leaving the banks reluctant to finance.

  3. on short sales, why do they not get approval from the bank before putting it on the market and soliciting offers? it seems kind of a backward process.

  4. I think 500k is about right, if you put 20% down and get a 400k mortgage at 6%, thats a 2k a month payment, plus 700 in hoa gets you to 2700. 2700 is prob the range that it would rent for, so pricing is right imo

  5. I haven’t seen this unit, but have been in this floorplan on a higher floor. My guess in the current market…around $625K. $500K seems low at this stage of the descent, but a lot of the Soma short sales/foreclosures seem to be hitting market with really low prices to generate attention. That’s not to say that prices won’t fall that far…just that this pricing seems ahead of the curve at this point. Also odd that the realtor is from Manteca.

  6. Antonio, you also need to add in property taxes (about $600/mo), some maintenance, and insurance (HOA likely does not cover the interior, but it may). And a reasonable opportunity cost (~ $3000/yr) for the down payment. One also gets a tax deduction for mortgage interest. Probably about $3400/mo out of pocket. I doubt it would cost that much to rent this place, but I may be wrong. So even at a 50% discount from 3 years ago, it still probably does not make sense to buy rather than rent, particularly given the risk of further downside.

  7. Ha ha, I LOVE all the chatter about how ARMS are resetting lower. The evidence, especially for 3/1 ARMs, which had the most aggressive initial rates, seems to show otherwise.
    This was purchased on MAY 26, 2006. Redfin shows it listed starting 11 months later, though it doesn’t list the price. Obviously whatever it listed for didn’t work for this flipper.
    But now, just past the three year mark, the seller gets religion. The payments have shot up and are crushing him and he can’t refinance. Doomed, he lists it at a “make YOU move” price.
    If this is 12D (which seems hard to believe), unit 10D, two floors below, was bought around the same time for 1.286M. 9D, a floor below, was bought around the same time for $1.247M.
    If they took out a loan that resets in year 3, look for them to start sprucing up their units soon!
    14D is already on the market, advertising a HUGE PRICE REDUCTION and 1 yr HOA fees (it will take the standard 3), and represents better planning: it’s been on the market for 91 days and they’ve got 3 more months to their own 3 year mark. Unfortunately, they want their 2006 price plus the realtor fees, so you can see what a pickle they are in (I suspect they have no money to bring to the closing), and how another short sale is in the works!
    You can only imagine what this one short sale is going to do to every condo in this building, and how quickly the other “owners” will realize what trouble they are in when it closes.

  8. sorry trip, forgot the prop taxes. agreed, i highly doubt this rents for anything close to 3400, my friend just rented a 2000 sq ft at avalon for 3300, this place is half the size, i think it would rent somewhere between 2500-3000

  9. It’s not going to go for anywhere near 500K. I’ll say more like 770K.
    I have a friend who bought in this building at the peak, 9th floor 2bed for 1.245 mil (might be 9D). OUCH!
    Thew watermark was always overpriced, it’s resetting to a more realistic price.

  10. Two questions all:
    1. I currently rent a 864 sq ft unit ( little view) at the Paramount for $3000 (+ $700/month for two car parking). Based on the above, it seems everyone thinks this is way too high. Is it?
    2. I am on the sidelines waiting to buy a 2/2 condo in SoMa. Plan was to get something by the end of the year. Is that too soon? I am getting killed on taxes with no write off…
    Thanks for your help.
    BTW – I looked at a unit in this building when it first opened. I really liked it, although thought it was outragously overpriced. Glad I couldn’t afford it back then – but feel sorry for the people who could.

  11. Jim:
    I think you are paying too much. I just rented out a 1500 square foot condo with two parking spaces for $3000 even. Last year when the rental market was booming I easily got $3500 and my pick of tenants. This time around when I listed it, I heard a lot of crickets chirping.
    Go to your landlord and negotiate down. I bet you could get $4-500 off if you did it tactfully and your LL isn’t a douchebag.
    Good luck.

  12. Jim,
    1. you should be able to negotiate MUCH better rent when you renew. I just signed lease there for 750 sf with full city/bay view for much less.
    2. Why wait? Submit a bid on 12D and see if they bite.

  13. Isn’t this unit on the backside of the building…directly facing the bridge (looks like a clever side shot taken by the agent)? I don’t know if that’s a good deal even around 600k.

  14. I just moved out of Avalon Towers just down the street at 388 Beale. 2BR / 2BA – 1 parking – approx 1200 sf was $3,600 mo
    IMO Watermark has always been overpriced. I can’t believe it’s actually going to ge below $600 sf though.

  15. Cash is king. I keep waiting for the bottom on the less than 1500 sq ft high rise. Cramer be damned. Do you think the bank would take 400 cash?

  16. 500K seems ambitious as a valuation, given where rents are heading. This unit would likely rent somewhere well south of 3000, my guess would be 2500-2700.
    My concern would be the impact that the impending distress sales will have as home debtors stop paying their HOA fees. I hope that the HOA in this building has built up fantastic reserves, because they may well need them.

  17. Really, no sale at 50% off the May ’06 price? Are you sure it wasn’t withdrawn because the sale is pending?
    If this is correct, it is a good example of a point LMRiM keeps making — the visible “market clearing price” skews high as it does not take into account the many, many places that simply don’t sell at all because they can’t fetch the seller’s asking price and are withdrawn.

  18. A unit (2/2 1019 sq.ft), which appears to be showing up as #1B on PropertyShark, is headed for the auction block on Sept. 14. Bought in 2006 for $1.3million, the unpaid balance is north of $1million (so long WaMu, thanks for all the fun).

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