As we first reported this past July:
One of 39 post-conversion condos [at 333 Grant Avenue] and a Below Market Rate (BMR) unit as designated by the Mayor’s Office of housing, 333 Grant Avenue #405 was purchased for $234,000 in November 2004 with $263,218 in loans to which a note for $25,000 was added in 2008.
In 2009, the 441 square foot studio was taken back by the bank. Unsuccessfully listed in 2009 and 2010, 333 Grant Avenue #405 has just returned to the market asking $140,000.
The resale of 333 Grant Avenue #405 closed escrow on Wednesday with a reported contract price of $140,000, forty (40) percent below its 2004 “Below Market Rate” sale, fifty (50) percent below what was borrowed.
∙ From Foreclosure To Foreclosures At 333 Grant Avenue [SocketSite]
The City’s BMR program is a disaster, lol.
Prime example of the unintended consequences that result from a municipality trying to alter the free market. Good intentions gone terribly, terribly wrong.
As long as the low end of the market stays flat, which is looks like it will for some time, these units will remain completely unmovable. The only people they are going to sell to is smart youngsters who have a good chunk from mom and dad, yet make under $75K a year, who realize they can buy this, put about 20% down, have a $600/month mortgage payment, and immediately rent the place out for $1800/month.
That’s your new BMR market – congrats SF. Dumbasses.
Are there restrictions on renting out BMRs?
No upside, but could be a sweet cash flow model?
Negative equity right off the bat led to default…
This building was a BMR headache 4 years ago already.
The issue is mixing high-income/high net-worth people with the BMR crowd. Different point of views, different wallet size. Combine this with “heads I win/tails you lose” mentality and you’re got yourself a nice tidy train wreck.
Yes, there are restrictions to renting out BMRs (you’re not supposed to). But of course, that doesn’t stop anyone. Agree 100% with LL. The BMR program is an absolute joke.
I lost this condo in 2008. There was a buyer before I went into foreclosure but the Mayor’s Office of Affordable housing dragged their feet and the buyer backed out. What is really horrific is that niether the MOH nor Wells Fargo Bank would work with me to keep my home. Even worse; Wells Fargo continued to pay the HOA dues on an empty unit, while I was forced to rent an apartment in the TL. An absolute joke; too kind.