As we wrote this past December:
While the bank owned 501 Beale #1D remains active and available, the bank owned #6C just hit the market. A South Beach comp at $806,000 in June 2006, the Watermark one bedroom was taken back by the bank this past November with $776,341 owed.
Asking $569,900 today, a sale at which would represent a 29 percent drop in value below its 2006 price. The bank owned 501 Beale #12G ended up selling for $750,000 in October, $1,000 “over asking” but 23 percent below its May 2006 purchase price of $975,000.
And while the MLS was finally updated yesterday to reflect a sale and new comp, 501 Beale #6C actually closed escrow on March 7, 2010 with a recorded contract price of $541,400. That’s $675 per square foot for the Watermark one-bedroom, 33 percent under its comp setting sale for $1,006 per square foot in 2006.
∙ Another Bank Owned Watermark Comp To Be: 501 Beale #6C [SocketSite]
“Look. $1000/sqft is the new price point. That’s just what it is. If you wanna be a playa you’ll man up and pay it otherwise you can go back to being a wannabe renter with your nose pressed up against the glass. Women will scorn you. Dogs will pee on you. And every morning for the rest of your life you’ll get up, look in the mirror, and wish that you had had the balls to “swing for the fences” and had paid $1000/sqft for a soma condo while you still could.” – realtor conventional wisdom circa. 2005-2008
That is probably a fair price. I always felt an attractive price point for good condos, in general, would be ~$550k for a 1/1 and ~$650k for a 2/2.
The pricing is fairly predictable, 33% under 2006 seems like the standard for condos, so there is nothing shocking here.
South Park: Episode 101
Scene: Exterior cattle ranch. Mutilated cow in foreground.
CATTLE RANCHER: That’s the third cow this month, at this rate all my cattle are gonna die before the Winter’s through.
The cows look up with concern.
OFFICER BARBRADY: This is nothing out of the unusual. Cows turn themselves inside out all the time.
The cows shake their heads.
Don’t hate the player, hate the game.
The photo shows the current outcropping which is planned to become a new city park, which will be great for the area. But the photo also shows an expanse of parking lot adjacent to the building, on which new (view-obstructing?) towers will eventually be built.
midcentfan – has there been a recent development for the ‘new city park’ you mention? I was under the impression that the developer who was going to build that gave up years ago due to financing concerns related to the cost of shoring up the deteriorating piers. I’d love to find out it is moving forward. As far as the parking lot goes…anything would be better than that but I believe nothing can be built higher than the podium Watermark is sitting on.
I too believe that the pricing is looking about right for this building in this location.
midcen fan…the parking lot was never planned for additional towers. It was, I believe, supposed to have low rise elements (office/retail) associated with the cruise terminal on the pier. That whole plan has disappeared, replaced with what I don’t know. But I wouldn’t expect any view obstructing towers.
It would greatly improve the Watermark to have something. It looks very forlorn rising out of the asphalt….
“Don’t hate the player, hate the game.”
Who can be considered the “player” for unit #6C? Certainly not any of the buyers so far… Which leaves only the Developer and the Realtor. So do you mean the Realtor is the “player”, and the “game” is talking people into taking on more debt than they can afford?
“don’t hate the player, hate the game.”
I guess this is one “professional’s” lame attempt at brushing off the outright lies and exaggerations that were a part of the RE bubble.
One more reason to consider RE agents as a problem to be solved. I cannot imagine a housing markets with these bottom feeders still engaged. Redfin has helped to knock them down, a little transparency on RE transactions will knock the MLS out too.
A little creative destruction is helpful and required here. Imagine: a future without realtors, a future with market transparency.
^^^
What, you expect people to drive themselves around on Sunday afternoon? Could that ever realistically happen?
Really Socketsite…. this is really a lame post. i think by now we know that comps for 2006-7 are close to 30% down.. especially in watermark, palms, beacon etc.
Post something that doesn’t state the obvious.
Well, in defense of Socketsite, there is not much more than the obvious to state these days. There’s a paucity of new developments to critique, not alot of surprises on the upside (though there are a few). More and more of this slow gradual creep downward.
Is it ex-sfer who said that this will all look like “watching paint dry”? That really is what it is these days.
^^
I have to agree with curmudgeon, though for a different reason. The bears here (including the editors) are entitled to indulge in “told you so” postings. Friends of mine who bought in the 2005-07 time period would have been much better off not buying then. They share that fate with many in the city.
…33% under 2006 seems like the standard for condos,…
This might be the norm for SOMA and South Beach, but the condo market in some neighborhoods (e.g. the Mission) are doing much better (but still down from ’06).
“Is it ex-sfer who said that this will all look like “watching paint dry”? That really is what it is these days.”
It’s a fair criticism that watching the housing bubble deflate is like watching paint dry, but that’s how housing busts often work. It’s often a long slow grind.
I praise Adam for sticking with it, because many of the real estate bloggers I have read in the past have given up or have started posting once every 3-4 months.
i like these articles if for no other reason that realtors try to hide this type of information.
This is a fine article. It establishes a comp in a “nice” building in a busy RE section of the city (that some SS posters like and others hate). A few years ago it was $1k/sqft, now it’s $675.
Speculation about what the city will do with the $7M escrowed for local parks by the Watermark developers is also welcome. I hope it goes into the pot along with fees from competitors to renovate Piers 30/32 into an Americas Cup venue.
From what I understand, the parking lot around the Watermark is somehow controlled by an Open Space coalition, but I wouldn’t be surprised if they sold it for “better” open space.
Why buy a one bedroom condo at all?
In this city its pencils out better to rent then buy anything smaller than a 2/2.
One bedrooms take the biggest hit in a downturn due to its innate limited resale appeal.
I think that all the mortgage brokers running around signing people up for mortgages that they can’t afford and the rampant mortgage fraud that results is an even bigger problem than real estate agents convincing people that they had to “buy now or be priced out forever!”. Luckily, The U.S. Senate came to the senses and realized that they have to do something about fly-by-night mortgage brokers. From the L.A. Times:
They also decided now would be a good time to rein in “Liar loans”. From the same story:
If this makes it into the final bill and is signed into law, then I think we’ll probably see a whole lot less bank owned properties on the market in five or six years afterward.