by Meagan Levitan:
We can always say we live in a bubble here in San Francisco as we trend so differently than most other jurisdictions in almost everything imaginable — lifestyle, politics, attitudes and, yes, real estate. I recently saw just how real our bubble is.
I took a sobering trip to Southern California last week (why yes, I was visiting my in laws but that’s not why it was sobering). The number of ‘for sale’ signs in your average So Cal city located in Riverside County was nothing short of disheartening — disheartening for the countless number of people who find themselves in need of selling (by choice or not). And disheartening to see, firsthand, what has contributed to the state of the mortgage and real estate markets nationally. Even more sobering were the number of “Bank Repos” and “Foreclosure” signs on these homes for sale. It truly brings the headlines of the imploding mortgage market to a tangible level.
My experience here in the City of late is this: while there aren’t the number of foreclosures here compared to other parts of the state and nation, the mortgage market doom nevertheless has contributed to a general state of unease and worry about the future of real estate. I point to an increasing number of price reductions and deals falling out of escrow, or those just narrowly getting into escrow, because of financing concerns. Lenders may be nervous and buyers worry they’re stretching. Overall lenders still seem to like doing business in San Francisco. However for sellers, a financing contingency on an offer is a real hurdle to get over. In the past few years it was almost a formality that a buyer had to go to any lengths to get assurances their loan would come through. Cash is king for sellers. The more cash they see over financing, the more they lean to that offer.
The number of buyers continues to be plentiful but so does the number of said buyers who insist on staying on the sidelines — rather than buy — because they believe the market is going to change drastically.
For now, though, it’s the end of the year. Even though there are people looking to buy 365 days a year, it’s safe to say the next three to four weeks will be slow. New inventory will trickle in (though it can also be a terrific time to bring a property to market if there’s nothing else like it on the market at the time) and sellers are likely to try their best to get those listings that have sat on the market a few months into escrow. Deals to be had? Most definitely.
Merry Christmas and Happy Holidays to all. Have a great week…
Cheers,
Meagan
Who are you Meegan? Potential buyer? SEller? Realtor?
I think it’s very important to take advantage of desperate sellers. Anybody listing now, or wants to sell now needs to be taken advantage of. This is capitalism at its finest, especially onces who are selling within a short time of buying. Dumb, dumb, dumb.
Pent up demand is huge over the past 2 years. Bonuses are at record highs.
HHolidays!
nice post meagan. are any of your relatives in the industry down south? i read another blog that happens to be based in the oc but covers lots of national news on the crisis. check out this post about how the peak of filings may have come and gone in august:
http://mortgage.freedomblogging.com/2007/12/19/did-foreclosures-peak-in-august/
http://money.cnn.com/2007/11/21/real_estate/NAR_prices_through_September/index.htm?postversion=2007112115
what was your point in linking this resort? sfh and condo’s are both up based on median prices according to this story and data. was that it?
please put some context in a post like this next time or i’m sure the editor will just delete it.
Good article I found surveying the entire Country for 3Q07 vs. 3Q06.
Amazing how we have two of the nation’s most expensive metro areas, and yet, we still go up 7-9% YoY. And yet, we still get to benefit from the Fed rate cut, and bailouts, and hand outs meant for those in Detroit etc. Ain’t America grand?
To top it off, 2007 will be a record year for bonuses in the financial community, despite subprime. Unbelievable and scary what housing will do in 2008 in our area.
Wow, Resort at Squaw Creek is offering crazy incentives right now. I may have to go take a look at these units once they slash them by 30% more next year. Thanks for the heads up.
Yup, I definitely love the Resort at Squaw Creek. Prices are off about 5% I think, and units are at around $1,000/sqft now from $1,100/sqft. Let me know if you need any advice. With Intrawest likely to take over the mountain, and w/ The Ritz and other high end developers coming, this place has the best location, and will likely go much higher over the next 5 years.
This is the most beautiful place on earth! :)
Happy Holidays!
http://www.squawcreek.com
that is an interesting point resort. are you worried about the ritz going in at northstar as big competition?
I guess the europeans are sucking up properties in Tahoe yet. Wonder why? Discounts are everywhere up here.
Hi James,
Not at all actually. The Resort welcomes the Ritz, and other super luxury developments to come to the North Western part of Tahoe. A rising tide lifts all boats. The Ritz will serve to highlight the value currently seen at The REsort, giving $/sqft at the Ritz will be in the $1,500/sqft+ range vs. $1,000/sqft at The Resort. Besides, there is only one Squaw Valley USA, which is the best mountain by far in Tahoe.
The more high end developers, the better. It will make the North Western portion of Tahoe even more high end and exclusive.
Happy Holidays all!
RSC
that’s great to hear. i’m equally excited about the ritz addition. i haven’t been to squaw in years, since intrawest bought it but was very impressed on a quick jaunt last winter. plumpjack is a really fun place to people watch as well.
maybe we’ll see you this winter, if it keeps snowing.
pray for snow!
I love The Resort at Squaw Creek as well. I’ve been going there for the past 9 years, and it is my favorite place to ski and bring family. The condos sold quickly two years ago, and there’s been some resales this year. I’m looking to buy as well, as those who are selling this year, like anybody selling within 2 years of holding, generally is a short termer and more desperate than normal.
At the end of the day, money is a means to an end, a better quality of life for me. Buying a prop like The Resort is going to work out great in the long run. I, too, am exciting about all the other high end developers around North West Lake Tahoe.
Tons of room to develop at Tahoe. Lots more high end condos will be on the way, so don’t worry.
If anybody cares, it’s snowing today, tomorow, sat, and Sunday :)
And then next week again. Awesome, it’s snowing.
what do you know about the new village at sugarbowl? sorry i’m just not a big fan of squaw.
I think Sugar Bowl is a nice little mountain fo day trips. I’m an advanced, and technical skiier, that is why myself and many of the elite skiiers in the country prefer Squaw.
I looked at the Sugabowl new condos as well. Nice, but they are asking $900-$1,000/sqft, and it’s yet to be built up, and there’s no 3 pools, 3 hottubs, spa, gym, 4 restaurants etc. But mainly, i’m into big time mountain skiing, which Sugar Bowl does not have.
Gonna dump next week! :)
alright resort. i’ll grant you that, but it doesn’t rain at sugarbowl and the management doesn’t suck.
;)
not to badger my point but look at this website squaw puts up for snowfall:
http://www.squaw.com/winter/snowfall.html
they make you drill down to a separate link to find the real base of snow
how lame is that?
i was hoping they might get some better people in there to run the place after cushing passed away but it looks like more of the same bs
If they can truly sell these at $1000/sq ft, they should be building 1000s of additional units. Tons of room to develop and costs are cheaper than building in the city with a higher return. I wouldn’t touch one of these as an “investment” especially in this climate.
SmugCloud – Actually, Phase I of the Village in Sugar Bowl is pretty much all sold out, and the pricing was indeed $900-$1,000/sqft. I was not a buyer b/c again, Sugarbowl is a small mountain in which I can day trip from SF. Squaw is 30 minutes farther, and The Resort is truly a destination place to bring the family (i have two kids). Sugar Bowl’s Village should be very nice in 3-5 years, but you are paying prices I think that are 2-5 years ahead. Meanwhile, life is happening now, and I like to live life now.
James – Donno where you got that management sucks at Squaw. I’ve been going up there for 10 years, and mgmt has always been very nice and friendly. I was here for X-mas weekend, and it was packed, and the service was fantastic. When I’m barrelling down KT-22, do I really care that I didn’t get my apple sider in the lobby fireplace as quick as I liked? No! I’m a skiier! And during the summer, I play at The Resort’s golf couse right outside the condo! :)
1 bedroom suites rent there for $500-650/night during the winters, and twobedroom suites rent for $1000-$1,150 and the place is packed. When you can buy a vacation rental that you want to use 30 days a year, and management rents it out on average at a 50% occupancy all year, and the rent pays all your HOAs, and 35% of your mortgage to boot while you have to do nothing, I think it’s a great no brainer for lifestyle. And if you want to rent it out on your own, you can get even more of your costs paid for.
Squaw and Alpine are the most environmentally friendly Resorts to boot.
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/12/04/MN68TNG4R.DTL
I think the opportunities are plentiful to buy all over Tahoe this year. And I do think that in 10 years time, with the entry of many high end developers, prices will get more pricey, as it is the destination area for Bay Areans and International people alike.
Here’s hoping to a great Winter season!
RSC
i guess i do need to give squaw another chance. they were so unfriendly to boarders back in the day which kind of turned me off to them. it was a different day when it rained all the way to the top and we couldn’t get our money back that really set me off, not to mention the bathrooms all being out of toilet paper and the staff being borderline insolent at every juncture up and down the mountain.
intrawest would not have stood for that so i have been optimistic ever since they announced their first deal for the base area.
i’ll go back this season and let you know what i think.
i patrol at sierra every winter so i am a little bias about what a mountain should be run like and how customer focused it should be, in addition to having wonderful hidden bowls that you can get fresh powder in for days after a storm.
;)
James – The Resort has been completely remodeled 2 years ago ($50 mil), with all new mgmt. Don’t let something in the past keep your bias for an extended period of time.
Supposed to DUMP 5-10 FEET this Thurs and Friday! If you can take Mon-Tues off, I’d do that instead, b/c it may be miserable trying to board on Saturday, but it could be AWESOME! I’m going up for sure.
RSC
SmugCloud – I forget to address your comment. Developers CAN’T build whatever and whenever they want around Lake Tahoe. Lake Tahoe is one of the hardest places in all of America to build. You can imagine all the red tape, and environmentalists. Trust me, you just can’t build.
…A SERIES OF WINTER STORMS STILL ON TRACK TOWARDS NORTHERN CALIFORNIA THURSDAY AFTERNOON THROUGH SUNDAY…
AN INTENSE LOW PRESSURE SYSTEM IN THE GULF OF ALASKA WILL PUSH SEVERAL STORMS INTO INTERIOR NORTHERN CALIFORNIA FROM THURSDAY EVENING THROUGH SUNDAY. HEAVY RAIN IN THE VALLEY AND HEAVY SNOW IN THE MOUNTAINS WILL PERSIST THROUGH THE FIRST WEEKEND OF 2008.
THE FIRST STORM WILL ARRIVE THURSDAY EVENING WITH UP TO ONE INCH OF RAIN IN THE VALLEY…AND ABOUT TWO FEET OF SNOW ABOVE 7000 FEET IN THE MOUNTAINS BY FRIDAY MORNING. SNOW LEVELS WILL BE BETWEEN 4000 AND 5000 FEET THURSDAY NIGHT. THE SECOND AND MORE POWERFUL STORM WILL BEGIN FRIDAY EVENING AND INTO FRIDAY NIGHT WITH 2 TO 3 INCHES OF RAIN IN THE VALLEY…AND 2 TO 4 FEET OF SNOW OVER A 24 HOUR PERIOD IN THE HIGHEST ELEVATIONS. THIS SECOND STORM WILL HAVE VERY POWERFUL WINDS WITH POSSIBLE GUSTS IN THE VALLEY AROUND 60 MPH…AND EXCESS OF 80 MPH IN THE MOUNTAINS. RAIN AND SNOW WILL CONTINUE ON SATURDAY…WITH ANOTHER STRONG WAVE MOVING INTO THE REGION ON SUNDAY MORNING.
DANGEROUS WINDS WILL CAUSE POSSIBLE BLIZZARD CONDITIONS OVER THE SIERRA NEVADA OVER THE WEEKEND. PLEASE MONITOR NATIONAL WEATHER SERVICE STATEMENTS AND FORECAST FOR THE LATEST UPDATES ON THIS SERIOUS WEATHER SITUATION.
Battle royale NYC or SF?
that’s why we love san francisco: to get EXCITED about a snow storm… instead of dreading the yuk on the road, the yuk to clean on the cars, the yuk on the shoes… all while battling extra commute time in a grumpy mood.
Owning in Tahoe is a bad weather hedge. Rainy weather in SF = snow in Tahoe = fun fun fun! :)