While we’ve seen short sales and resales at a loss, as far as we know (or at least can recall), 425 First Street #3908 is the first listed resale of a foreclosure at One Rincon Hill.
Purchased for $855,000 in June 2008, listed for $775,000 this past March, and then taken back by the bank this past April, the 755 square foot view one-bedroom is back on the market and asking $695,000 today ($921 per square).
Four floors above the sales office has the 755 square foot #4308 listed for $780,000 ($1,033 per square foot), while twenty-five floors below #1408 has been back on the market for a month asking $665,000 (its third listing since February 2009).
And while the list price of $921 per square foot for 425 1st #3908 isn’t exactly “cheap,” it is 19 percent cheaper than the $1,132 per square foot the condo sold for two years ago.
UPDATE (6/4): The list price for 425 1st Street #4308 was reduced to $749,000 by the sales office last night.
∙ Listing: 425 1st Street #1408 (1/1) 755 sqft – $665,000 [MLS]
∙ Listing: 425 1st Street #3908 (1/1) 755 sqft – $695,000 [MLS]
∙ Listing: 425 1st Street #4308 (1/1) 755 sqft – $780,000 $749,000 [MLS]
Three On The Thirtieth At One (Rincon) [SocketSite]

Comments from Plugged-In Readers

  1. Posted by Paul Hwang

    I’m not saying it is or it isn’t, but I’m just wondering how you determined it isn’t exactly “cheap”.

  2. Posted by Amen Corner

    $921 per sq ft is a significant premium over the cost of buying a relatively nice condo in an older building in many nice areas of SF. So I guess it really depends how much people are willing to pay extra for a condo in a “latest and greatest” tower building in this location.

  3. Posted by lol

    Well, that’s one more “will never happen” that has to be striken through today.
    ORH is unique in many ways, but not that unique that it escapes the universal law of gravity.

  4. Posted by Can't think of cool name

    So, if/when the second tower is built, these all will have their bridge views blocked?

  5. Posted by ex SF-er

    unfortunately for ORH, there are a lot of speculators and “investors” and non-owner occupied units in that building. they are obviously more likely to foreclose than owner occupied units.
    it doesn’t help that many of the people are technically upside down by over 6 figures in their ORH unit, nor that rents come nowhere close to covering holding costs.
    I know a few of the owners of this building, and I’d say the vast majority of them love the building… but the terrible economics of the building are taking its toll on all of them. nobody likes to “lose” $5K+ in equity every month.
    on a plus side for the building: some of the owners in the building are getting loan mods, although I don’t know the exact details.

  6. Posted by Willow

    Time will tell Paul but I have to agree with the editor; at this price it is not “cheap” and will most likely be reflected in the sales price which I suspect is going to be significantly lower than the $695,000 the bank is asking for this small one bedroom. And of course there is the $700 plus monthly HOA…

  7. Posted by diemos

    “I’m just wondering how you determined it isn’t exactly “cheap”.”
    3x income is “affordable”.
    Below that is “cheap”.
    Above that is “not cheap”.

  8. Posted by Gil

    I wouldn’t worry about the ORH views, can’t think of cool name, everything I’ve heard says the second tower will never be built.

  9. Posted by Willow

    Actually, I just ran the numbers and with 140K down the monthly mortgage is going to run approximately 3K per month. Maybe someone will bite at this price after all…
    What was the previous owner thinking though! By June 2008 the writing was on the wall in terms of the SF condo market. Was there a down payment involved here? EBGuy?

  10. Posted by hangemhi

    Diemos – the nytimes rent v buy calculator says it’s smarter to buy after 5 years if this were to rent for $3,000 per month vs. sell for $700k at today’s 5% interest rates.
    at $2500 per month the calculator says after 8 years it’s better to buy.
    at 7% interest rates and $3,000 in rent it’s better to buy after 10 years.

  11. Posted by Michael

    That you did not include the HOA and are assuming appreciation that doesn’t currently exist.
    Flat market = never better to buy
    Up 2% a year = never better to buy
    Up 3% a year = better to buy after 20 years
    Up 4% a year = better to buy after 8 years
    All with 5% loan and $3K rent.

  12. Posted by ex SF-er

    What was the previous owner thinking though! By June 2008 the writing was on the wall in terms of the SF condo market. Was there a down payment involved here? EBGuy?
    I can’t remember actual dates, but many people closed months to years after they actually signed the contract. If my memory serves (I may be off a month or two), my friends didn’t close until 14 months after they signed the contract.
    some people saw the writing on the wall, but “had” to close or lose some/most of their downpayment/earnest money.
    clearly in retrospect it would have been smarter to lose the 5% downpayment than to close… but not sure that was obvious to the majority of people back in 2008.
    as for rent vs buy:
    why not just do this:
    rent forever until the monthly cost to own is comparable to the monthly cost to rent. Then buy.
    For instance: if I own at $4k/month, but can rent the same at $3k/month (after all deductions, breaks, etc), then why not rent?
    buy only when/if rent rises to the same cost that owning does, locking in your monthly payment at that time.
    not sure why you’d want to lock in a payment now when that payment might drop in the future (housing depreciation), and you can rent for less.

  13. Posted by diemos

    Ten years ago when I first started looking at buy vs rent scenarios I was struck by just how sensitive they were to one’s assumptions about future appreciation and future price inflation.
    Calculators are great once you understand all the assumptions that go into them and how the calculation depends on them.

  14. Posted by third_tower

    so how much does a one bedroom in the 08 plan rent for with anice view of bridge ?
    And someone says above that the bridge views will be gone when tower two is built, are you sure about this ?

  15. Posted by Gil

    Tower two is not going to be built.
    Hopefully the vacant lot will at some point be turned into open space or, if another development comes along, it will be scaled way back.

  16. Posted by Jeremy

    Here’s an 08 stack, 20 floors lower, for $2800:

  17. Posted by EBGuy

    Wish I had more info on the loan. Wells Fargo was mortgagee (with only a single Deed of Trust), so I think its safe to say that down payment money was lost. YMMV… Like I said on the previous thread, plenty of Countrywide financing in this building.

  18. Posted by Paul Hwang

    39th Floor corner 1 br w outdoor space with views of the Bay Bridge and Downtown.
    1408 on sale for $685k
    4308 on sale for $780k
    $695K is a lot of money, but so is $85,000 if you spend it on an Audi R8. Really that R8 in my opinion is an $80k car max. At $85k would it not be exactly “cheap”?

  19. Posted by Willow

    Interesting perspective Paul. Demand however would indicate that a new R8 selling for $85,000 would be sold extremely quickly. In that sense it can be considered “cheap”. However, I suspect 3908 is going nowhere anytime soon at $695,000. This is supported by the fact that 1408 has been languishing on the market for several months and is unsold at it’s current price of $665,000. Don’t you think?

  20. Posted by Rillion

    Yeah, its all a matter of perspective, I spent $24k on a car and $485k on a 2bd condo and I don’t consider either of them to have been “cheap”. Were they less expensive then other alternatives? Yes. Do I consider them to have been a good value? Yes. But cheap? No way.

  21. Posted by SocketSite

    UPDATE: The list price for 425 1st Street #4308 was reduced to $749,000 by the sales office last night.

  22. Posted by Eric

    Paul, you must consider maintenance (similar to HOAs) on the Audi in your calculations. I own an Audi, and I can assure you I know my mechanic well.

  23. Posted by SocketSite

    The list price for 425 1st Street #1408 has just been reduced $36,000 (5%), now asking $629,000.

  24. Posted by SocketSite

    The list price for 425 1st Street #3908 has just been reduced by $33,000 (5%), now asking $662,000. Once again, purchased for $855,000 in June 2008.

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