San Diego Market Monitor

2008 Predictions

2008-02-24T13:21:00.001-08:00

It's been an interesting year since my last predictions. For the most part the market performed pretty much as speculated. In retrospect it was pretty easy predict the market selloff. Predicting the bottom might prove a more complex task. At any rate here are my predictions for 2008.

Prices in the aggregate continue to decrease. The slow deflation of values continues with the distressed properties leading the way.
The new developments, Electra, Aria, The Mark, SmartCorner and Alta continue to have relatively large ready for sale and unoccupied units that slowly get occupied via sales or rental programs. Back in the "old" days it was normal for a new condominium project to have unsold units that were available for immediate move in. This was why the early phase people got a relative bargain. This relationship got pretty warped during the bubble and to some degree the standing inventory may point to a return of the normal pre-bubble relationships returning which is a good thing.

A bottom isn't reached in 2008 however relative bargains that have seen most of their deprecation start to become interesting.

In the broader market the concept of cash flow positive/neutral rental property starts to become more realistic. I'm planning on doing some analysis in this area to see what things are like today and what price action is needed for this to start making sense. If anyone has any specific examples post them or email them over as this may be an interesting topic to revisit over the course of the year.

Wildcards that could factor significantly into the market include the increase of the conforming loan amounts, recovery or yet another leg down in the credit markets, the prospects of a recession and inflationary pressures driving interest rates higher.

The market will remain worth watching. Downtown will continue to grow in other areas like hotels, rental apartments, office and entertainment which will help create an even better environment that will pair up nicely with reduced prices.

Another La Vita Unit Close to Developer Price

2008-02-14T19:21:00.000-08:00

La Vita is a middle market property in Little Italy. Built by Intergulf.

Unit #1508 which is a nice northeast view two bedroom recently closed for $525,000, previously sold for over $700,000.

Keep in mind that the developer prices for La Vita were set at least a year before the initial closings took place in early 2005.

La Vita Getting Close to Developer Price

2008-01-05T20:24:00.002-08:00

This bank owned mid rise penthouse has been price cut almost down to the original developer price.

Currently listed at $549,000 this unit once sold for a whopping $810,000.

2007 Predictions Revisited

2007-12-31T18:40:00.000-08:00

I know the blog has been slow lately and I thank those of you that email me privately about the blog and what I've been up to. Doing this has been extremely fun and personally rewarding.

The original mission of proving the market was moving down via posting about the price action of specific properties has been met. I still intend to blog from time to time about specific properties or other items of interest so check back.

It's New Years Eve and there is very little time to update the blog with analysis of last year's predictions before we uncork 2008. Stay tuned for another post on predictions for next year.

The Predictions

1.) San Diego property will continue to decline in value with condos continuing to lead the movement down. This decrease will range from 5-25%.

I think it's very safe to say that this value range decrease came to pass for all but a very small portion of unique properties.

2.) Downtown condos will depreciate another 10-25% in another slow and orderly decline similar to how 2006 played out. Quality will be key in terms of holding value.

Again, this also came to pass. Quality condos did fair better than the marginal condos, apartment conversions in particular.

3.) At least one more downtown condo project will go rental before completion. As noted on this blog the former Broadway Lofts condominiums has reverted to a rental project. A potential candidate for going the rental route is Solara Lofts which is an office building conversion project that should be finished by early summer, since sales haven't started yet it may be prudent for them to pull the development off of the market until prices stabilize.

While Solara Lofts did not convert to rentals, the SmartCorner project is advertising new condos as rentals on Craigslist.

4.) The massive number of new urban condos coming will continue to impact price declines in the attached sector of the market, however since many of the developers will decide to carry inventory for 3-6 months after project completion and since the natural tendency for construction projects to take longer than scheduled the inventory increase and price declines continue into 2008.

There are many unsold new developer units on that are not listed for sale as well as new units at Aria and Electra coming onto the market, this prediction while hard to quantify is arguably taking place and as predicted will persist into 2008.

My closing comments for last year:

In summary the decline trend continues for 2007 with a bottom in the market pushed out past the coming year. A significant wildcard are interest rates which could drive a quicker decline if the one two punch of materially higher rates combined with adjustable mortgage resets combines to drive more foreclosure and short sale activity

While interest rates didn't go up much the major credit market problems related to the housing correction did in fact drive short sale and foreclosure activity in 2007 which clearly added to the price declines experienced in 2007.

All in all it's been a very interesting year in San Diego real estate

Four Acqua Vista Foreclosures

2007-11-02T22:35:00.000-07:00

Over the last day or so foreclosure.com lists four Acqua Vista condos that are end the end of the foreclosure process.

Units 222, 536, 858 and 1106 to be specific.

I think it is safe to say at this point in time that every unit in the building is worth less than the original developer price.

$200K+ Loss on Foreclosed Downtown Condo at Discovery #211

2007-10-16T08:46:00.000-07:00

This is a huge loss from the high water mark set in the summer of 2004. Based on the new listing price and the original developer price this property is likely valued at mid to late 2004 prices. I also know that this unit was vacant for probably two years so the "all in" loss on this property is quite substantial. I do think this is a good example of once underutilized "portfolio" property that wasn't being used now coming back to the market.

The question is how many properties like this are out there?

Type: Listed on MLS(#071081723)

List Price: $524,900
Cost: $699,000
Loss@6% Sales Expenses: $205,594
Loss%: 29.41%

Purchase Date: 07/28/2004
Holding Period: 39 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 1329

Purchase Details: view

2003 Prices Arrive at Discovery

2007-10-11T20:35:00.000-07:00

Very interesting closed sale on this Discovery condo

This is an almost four year hold time that still generated a substantial loss.

Problems at Solar Lofts & Tower?

2007-10-10T11:48:00.000-07:00

Extremely interesting report over in this forum post regarding part of the Solar Tower has gone into foreclosure. There is also a report of a developer bankruptcy possibility as well.

Solara Tower was supposed to be the sibling project to the neighboring Solara Loft project. Solara Loft is now completed and sales are almost assuredly less than projected and given the broader credit market problems this is not too surprising.

Former Condo Project Converts to Affordable Rentals

2007-09-24T20:25:00.000-07:00

The condo project planned for the East Village to be built where the Burger King on 10th Avenue now resides is going to be built after all, this time as an affordable rental project with CCDC and tax free bond subsidies.

From the Union Tribune story today I find the following detail particularly interesting:

"The developer, San Diego-based Affirmed Housing, got the land at the bargain-basement price of $4.4 million, or $202 a square foot. The current per-square-foot average is $250; the average was $350 during the market heyday two years ago, said one real estate economist."

This means that developable "dirt" downtown has depreciated roughly 40%. While not surprising given predictions made on this blog and by many market watchers getting confirmation with actual transaction data is always notable.

Downtown Condo at Park Blvd West #1405

2007-09-17T09:15:00.000-07:00

This smaller two bedroom unit at Park Boulevard West is listed substantially below its last sale in December 2004 and is very close to the original developer price set by DR Horton probably sometime in early 2003.

Market watches may be interested to know that this project is a bit of a sibling to La Boheme in North Park which is the subject of a lot of promotion for a "quasi-auction" that is taking place soon.

Type: Listed on MLS(#076047580)

List Price: $409,900
Cost: $500,000
Loss@6% Sales Expenses: $114,694
Loss%: 22.94%

Purchase Date: 12/23/2004
Holding Period: 33 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 910

Purchase Details: view

Downtown Condo at Symphony Terrace #503

2007-09-07T09:51:00.000-07:00

This Cortez Hill condo is interesting as it's last sale date is in early 2004, it's a bank owned property and based on the MLS pictures it was throughly trashed by the prior tenant.

Type: Listed on MLS(#076070982)

List Price: $209,900
Cost: $276,500
Loss@6% Sales Expenses: $79,194
Loss%: 28.64%

Purchase Date: 02/18/2004
Holding Period: 43 months and counting...

Bedrooms: 1
Bathrooms: 1

Purchase Details: view

Huge Loss on Bank Owned Downtown Condo at La Vita #1308

2007-08-28T19:43:00.000-07:00

La Vita is located in Little Italy and is a "middle market" complex. This unit pretty much personifies the current crisis in the credit markets as it was purchased just over a year ago and has already gone back to the lender.

Type: Listed on MLS(#076059723)

List Price: $549,900
(Range priced $549,900 to $549,900)
Cost: $725,000
Loss@6% Sales Expenses: $208,094
Loss%: 28.70%

Purchase Date: 08/04/2006
Holding Period: 12 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1132

Purchase Details: view

Downtown Condo at ParkLoft #414

2007-08-21T13:16:00.000-07:00

ParkLoft is a mid rise "loft" style project near Petco Park.

This unit has a fairly large loss but what is really interesting is that it is listed below the developer sale price from four years ago - way back in 2003!

Type: Listed on MLS(#076042541)

List Price: $487,000
(Range priced $475,000 to $499,000)
Cost: $523,900
Loss@6% Sales Expenses: $66,120
Loss%: 12.62%

Purchase Date: 06/27/2003
Holding Period: 50 months and counting...

Bedrooms: 0
Bathrooms: 1.5
Square Feet: 1380

Purchase Details: view

Taxes Due on Foreclosed and Short Sale Properties

2007-08-21T07:09:00.000-07:00

I found this Union Tribune article very insightful on the short sale issues surrounding foreclosed and short sale properties.

Downtown Condo at Horizons #1301

2007-08-08T15:17:00.000-07:00

Horizons is a Bosa project in downtown's Marina District.

The loss on this unit isn't horrible relative to the other losses that we've seen. What is very notable is the last sale was back in April 2004 which is getting awfully close to 2003 prices. Keep in mind this is a very high quality building and not an apartment conversion.

Type: Listed on MLS(#076057042)

List Price: $609,000
(Range priced $599,000 to $619,000)
Cost: $635,000
Loss@6% Sales Expenses: $62,540
Loss%: 9.85%

Purchase Date: 04/28/2004
Holding Period: 40 months and counting...

Bedrooms: 1
Bathrooms: 2
Square Feet: 1036

Purchase Details: view

Bankers Hill Condo Project Ceases Construction

2007-08-03T07:23:00.000-07:00

The San Diego Union Tribune reports on the work stoppage at a Bankers Hill midrise.

This is too bad in my view as more development on Bankers Hill is a positive. Regardless this is not overly surprising given the credit crunch on Wall Street.

Lofts at 777 6th Avenue

2007-07-25T17:51:00.000-07:00

The Lofts at 777 6th Avenue was a rental project that was converted into condos. This is another apartment conversion project that is likely to have a majority of the units worth less than what the current owners paid. There are four units current listed for sale at losses noted below:

Unit #411
Type: Listed on MLS(#076058976)

List Price: $409,000
(Range priced $389,000 to $429,000)
Cost: $438,990
Loss@6% Sales Expenses: $54,530
Loss%: 12.42%

Purchase Date: 10/27/2006
Holding Period: 9 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 749

Purchase Details: view

Unit #207
Type: Listed on MLS(#076050300)

List Price: $387,000
(Range priced $379,000 to $395,000)
Cost: $441,000
Loss@6% Sales Expenses: $77,220
Loss%: 17.51%

Purchase Date: 10/12/2006
Holding Period: 9 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 725

Purchase Details: view

Unit #415
Type: Listed on MLS(#076054817)

List Price: $412,000
(Range priced $399,000 to $425,000)
Cost: $486,000
Loss@6% Sales Expenses: $98,720
Loss%: 20.31%

Purchase Date: 10/04/2006
Holding Period: 9 months and counting...

Bedrooms: 1
Bathrooms: 1

Purchase Details: view

Unit #205
Type: Listed on MLS(#076058984)

List Price: $389,000
(Range priced $379,000 to $399,000)
Cost: $441,000
Loss@6% Sales Expenses: $75,340
Loss%: 17.08%

Purchase Date: 10/02/2006
Holding Period: 9 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 725

Purchase Details: view

Downtown Condo at Symphony Terrace #801

2007-07-20T11:06:00.000-07:00

Symphony Terrace is on Cortez Hill and was built in the early 80s. As one of the older buildings around this property has an interesting price history. The description indicates the unit is in need of upgrades.

Type: Listed on MLS(#076039349)

List Price: $499,000
(Range priced $499,000 to $499,000)
Cost: $560,000
Loss@6% Sales Expenses: $90,940
Loss%: 16.24%

Purchase Date: 07/02/2004
Holding Period: 36 months and counting...

Bedrooms: 3
Bathrooms: 2
Square Feet: 1384

Purchase Details: view

Downtown Condo at La Vita #M706

2007-07-11T13:42:00.001-07:00

La Vita is an Intergulf project in Little Italy.

This unit is at the top of the midrise tower. This unit is listed dramatically below its last sale price from early 2006.

Type: Listed on MLS(#071053258)

List Price: $699,900

Cost: $810,000
Loss@6% Sales Expenses: $152,094
Loss%: 18.78%

Purchase Date: 02/03/2006
Holding Period: 17 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1246

Purchase Details: view

Downtown Condo at Atria #422

2007-07-05T21:43:00.000-07:00

Atria is the former 101 Market Street Apartments which was converted into condominiums by Hammer Ventures back in the boom days. I am not sure how involved Hammer is in the project at this point. I would imagine that many of their conversion projects are under significant financial stress.

This unit is listed below the developer price from about two years ago. It's a unique unit as there are not many three bedrooms downtown. That said for over $700,000 there much better values to be had in the downtown marketplace.

Type: Listed on MLS(#076051448)

List Price: $729,000

Cost: $762,080
Loss@6% Sales Expenses: $76,820
Loss%: 10.08%

Purchase Date: 09/22/2005
Holding Period: 22 months and counting...

Bedrooms: 3
Bathrooms: 3.5
Square Feet: 1496

Purchase Details: view

Huge Loss on Downtown Condo at The Mills #304

2007-07-03T09:17:00.000-07:00

The Mills is neck and neck with Acqua Vista as the complex with the biggest losses. Acqua Vista is bigger and taller so it has a higher profile. The most pain may be taking place at the Mills however. The quality levels there are low and there aren't any amenities.

This particular unit is listed significantly below the developer price set three years ago.

Type: Listed on MLS(#076031910)

List Price: $440,000
(Range priced $430,000 to $450,000)
Cost: $516,066
Loss@6% Sales Expenses: $102,466
Loss%: 19.86%

Purchase Date: 07/27/2004
Holding Period: 36 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1090

Purchase Details: view

Downtown Condo at La Vita #205

2007-06-28T09:10:00.000-07:00

La Vita is the tallest building in Little Italy and was completed right around the high in the market. The one bedrooms there are all virtually identical short of view and granite color which creates a nice situation for market watchers to gauge the value of these units.

This unit has generated a huge loss for a model one bedroom condo. I know there were several units like this that were flipped when the building was opened so I'm certain there are more distressed properties in La Vita.

Type: Listed on MLS(#078045642)

List Price: $362,250

Cost: $435,000
Loss@6% Sales Expenses: $94,485
Loss%: 21.72%

Purchase Date: 03/24/2006
Holding Period: 15 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 706

Purchase Details: view

Downtown Condo at Bella Via #208

2007-06-21T13:55:00.000-07:00

Bella Via is located on India right in the heart of Little Italy. This unit is listed significantly below its last sales price from the summer of 2004 - nearly three years ago!

Type: Listed on MLS(#076048415)

List Price: $435,000

Cost: $500,000
Loss@6% Sales Expenses: $91,100
Loss%: 18.22%

Purchase Date: 08/05/2004
Holding Period: 34 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 903

Purchase Details: view

Downtown Condo at ParkLoft #1102

2007-06-06T09:09:00.000-07:00

Parkloft is in the recently carved out of the East Village Ballpark District.

This unit shows a significant net loss, even more interesting is the last sales date of February 2004 which was over three years ago.

Type: Listed on MLS(#076032067)

List Price: $1,894,900
Cost: $1,950,000
Loss@6% Sales Expenses: $168,794
Loss%: 8.66%

Purchase Date: 02/20/2004
Holding Period: 40 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 2914

Purchase Details: view

Downtown Condo at Park Row #112

2007-05-30T14:55:00.000-07:00

Park Row is one of downtown's older projects and is in the Marina District. This large one bedroom loft is listed below last sales price from the fall of 2005. The sales history on this one is very interesting as the 2nd to last sale from January 2005 shows practically no growth.

Type: Listed on MLS(#076040962)

List Price: $510,000
Cost: $540,000
Loss@6% Sales Expenses: $60,600
Loss%: 11.22%

Purchase Date: 11/15/2005
Holding Period: 18 months and counting...

Bedrooms: 1
Bathrooms: 2
Square Feet: 977

Purchase Details: view

Large Loss on Luxury Downtown Condo at The Metropolitan #2803

2007-05-24T09:22:00.000-07:00

The Metropolitan might possibly be the highest end condominium in downtown San Diego. I know several Realtors are saying that only the low end properties have seen price corrections, this specific unit indicates otherwise.

Type: Listed on MLS(#066046317)

List Price: $2,288,888

Cost: $2,400,000
Loss@6% Sales Expenses: $248,445
Loss%: 10.35%

Purchase Date: 03/16/2005
Holding Period: 26 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 2058

Purchase Details: view

$100K Plus Loss on Downtown Condo at Metrome #305

2007-05-20T19:48:00.000-07:00

Metrome is in the East Village/Ball Park District. This development sold a lot of units at the market high which has lead to a fair number of losses at the complex.

This large one bedroom unit is listed well below the developer price from 2005.

Type: Listed on MLS(#078035143)

List Price: $425,000
(Range priced $400,000 to $450,000)
Cost: $510,700
Loss@6% Sales Expenses: $111,200
Loss%: 21.77%

Purchase Date: 08/26/2005
Holding Period: 21 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 994

Purchase Details: view

Alicante Auction

2007-05-18T18:17:00.000-07:00

Interesting forum thread that discussed a "fly by auction" today at Alicante which is very interesting.

I'm sure this was planned but I've not heard of this occurring at the property location before. This did not seem well marketed as one of the tenants in the building didn't even know it was going to occur until after it started.

Stunning Loss on Downtown Condo at ParkLoft #602

2007-05-16T19:40:00.000-07:00

This loss is so large that I have to wonder if the sale in 2006 was fraudulent, a clerical error of some sort or the buyer was extremely uniformed. That said a large unit like this could have sold for around this price at the high point in the market.

Type: Listed on MLS(#076032940)

List Price: $787,900
(Range priced $787,900 to $787,900)
Cost: $1,100,000
Loss@6% Sales Expenses: $359,374
Loss%: 32.67%

Purchase Date: 06/05/2006
Holding Period: 11 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1609

Purchase Details: view

Downtown Condo at Treo #800

2007-05-11T10:29:00.000-07:00

Treo is a "middle market" project located in the Columbia District.

This unit is listed substantially below its last sale price from the summer of 2004. Almost three years ago!

Type: Listed on MLS(#076033968)

List Price: $662,500
(Range priced $650,000 to $675,000)
Cost: $750,000
Loss@6% Sales Expenses: $127,250
Loss%: 16.97%

Purchase Date: 07/26/2004
Holding Period: 34 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 1337

Purchase Details: view

$100,000+ Loss on Downtown Condo at Discovery #516

2007-05-09T12:56:00.000-07:00

**Note: I was rear ended a few days ago by a real estate agent of all people and have been caught in all the problems that an auto accident entails, new posts should resume again at the usual pace. I do have 30+ posts backed up so there's plenty to blog about.**

Discovery is located atop Cortez Hill and at least until Aria opens and we get to see the level of quality in the building Discovery will remain the premier building on the Hill.

This particular unit is listed well below its last sale price from the Summer of 2004, almost three years ago.

Type: Listed on MLS(#076035111)

List Price: $519,000

Cost: $595,000
Loss@6% Sales Expenses: $107,140
Loss%: 18.01%

Purchase Date: 08/09/2004
Holding Period: 33 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1040

Purchase Details: view

Downtown Condo at Union Square #3207

2007-05-02T11:43:00.000-07:00

Union Square is in the East Village. It's a relatively nondescript complex in the rougher part of East Village. There was a lot of flipping going on when the complex was complete so there are likely to be a lot of units that are now underwater. This unit is listed below its last sale price from January 2005.

Type: Listed on MLS(#076023998)

List Price: $439,000
(Range priced $439,000 to $439,000)
Cost: $470,000
Loss@6% Sales Expenses: $57,340
Loss%: 12.20%

Purchase Date: 01/19/2005
Holding Period: 28 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1061

Purchase Details: view

Downtown Condo at Acqua Vista #602

2007-04-30T19:33:00.000-07:00

This unit and the now infamous Acqua Vista is listed for $100,000 below the last sale price and $11,000 less than the first developer price.

Type: Listed on MLS(#076034265)

List Price: $400,000
(Range priced $400,000 to $400,000)
Cost: $500,000
Loss@6% Sales Expenses: $124,000
Loss%: 24.80%

Purchase Date: 08/30/2005
Holding Period: 20 months and counting...

Bedrooms: 2
Bathrooms: 1
Square Feet: 874

Purchase Details: view

Acqua Vista

2007-04-30T10:23:00.000-07:00

As has been reported on this blog for quite sometime the problems at Acqua Vista are starting to hit the broader media. This Voice of San Diego article focuses on the problems at Acqua Vista.

This building is in rough shape, when I walk by it the for sale and for rent signs are quite numerous. The value in the building, in particular the lower units without views, is probably a solid 30% less than the current pricing.

Downtown Condo listed below 2003 pricing at Pacific Terrace #404

2007-04-28T19:34:00.000-07:00

Pacific Terrace is located at the edge of the Marina District near the Gaslamp Quarter. It's a relatively small project.

This unit is range priced just below the orginal developer price and the first resale price from 2003 which is quite notable.

Type: Listed on MLS(#076033488)

List Price: $275,000
(Range priced $260,000 to $290,000)
Cost: $347,000
Loss@6% Sales Expenses: $88,500
Loss%: 25.50%

Purchase Date: 08/14/2003
Holding Period: 44 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 606

Purchase Details: view

Bankers Hill Condo at Laurel Bay #438

2007-04-26T10:56:00.000-07:00

Laurel Bay is another apartment conversion although this property was built to very high standards so it would probably be more like a Cityfront Terrace type of conversion. That said the project has had tough times and to my knowledge the original developer, Hammer Ventures, has been removed from the active management of the conversion.

This particular property has taken a big hit and is listed well below the developer sales price from 2005.

Type: Listed on MLS(#076031743)

List Price: $497,000
(Range priced $485,000 to $509,000)
Cost: $585,990
Loss@6% Sales Expenses: $118,810
Loss%: 20.28%

Purchase Date: 11/18/2005
Holding Period: 17 months and counting...

Bedrooms: 1
Bathrooms: 2
Square Feet: 924

Purchase Details: view

Massive Loss on Downtown Condo at Discovery #1803

2007-04-23T09:26:00.000-07:00

We are breaking records on this luxury condo at Discovery. It's last sale price was over $1 Million and it's current list price is below the recorded sale from August of 2004. That's an over $400,000 loss / 40% loss in value.

Additionally this property is in foreclosure proceedings.

Type: Listed on MLS(#076031736)

List Price: $700,000
(Range priced $675,000 to $725,000)
Cost: $1,095,000
Loss@6% Sales Expenses: $437,000
Loss%: 39.91%

Purchase Date: 04/07/2006
Holding Period: 12 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1230

Purchase Details: view

Downtown Condo at Palermo #408

2007-04-14T11:14:00.000-07:00

This and the next two posts all feature Palermo which is another development that was designed and built to be rental apartments that was converted into condominiums at the height of the market. At this point the values are almost certainly below the original developer prices.

Type: Listed on MLS(#076006643)

List Price: $499,900
(Range priced $499,900 to $499,900)
Cost: $515,050
Loss@6% Sales Expenses: $45,144
Loss%: 8.76%

Purchase Date: 04/01/2005
Holding Period: 24 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1065

Purchase Details: view

Downtown Condo at Palermo #610

2007-04-14T11:13:00.001-07:00

Type: Listed on MLS(#076028664)

List Price: $439,900
Cost: $442,950
Loss@6% Sales Expenses: $29,444
Loss%: 6.65%

Purchase Date: 01/14/2005
Holding Period: 27 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 845

Purchase Details: view

Downtown Condo at Palermo #332

2007-04-14T11:12:00.001-07:00

Type: Listed on MLS(#078025201)

List Price: $335,000
(Range priced $330,000 to $340,000)
Cost: $353,000
Loss@6% Sales Expenses: $38,100
Loss%: 10.79%

Purchase Date: 02/15/2005
Holding Period: 26 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 663

Purchase Details: view

Downtown Condo at Acqua Vista #608

2007-04-12T08:43:00.000-07:00

Acqua Vista is the often featured apartment conversion condominium project in Little Italy.

This is yet another unit listed below the original developer price. It has been on the market for every 150 days and has sustained two price cuts:

Price Reduced: 04/12/2007 from $335,000 to $324,800
Price Reduced: 04/06/2007 from $349,000 to $335,000

Type: Listed on MLS(#066094893)

List Price: $324,800
(Range priced $324,800 to $324,800)
Cost: $356,000
Loss@6% Sales Expenses: $50,688
Loss%: 14.24%

Purchase Date: 01/28/2005
Holding Period: 27 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 760

Purchase Details: view

Downtown Condo at Treo #805

2007-04-07T12:54:00.000-07:00

This unit at Treo is listed below its last sale price from almost three years ago.

Type: Listed on MLS(#076013055)

List Price: $480,000
(Range priced $465,000 to $495,000)
Cost: $515,000
Loss@6% Sales Expenses: $63,800
Loss%: 12.39%

Purchase Date: 06/17/2004
Holding Period: 34 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 871

Purchase Details: view

Real Estate Roller Coster

2007-04-04T20:47:00.000-07:00

Taking a little break from the local posts to feature this very interesting video sent to me by Keith.

Downtown Condo at Acqua Vista #424

2007-04-03T10:39:00.000-07:00

This is yet another Acqua Vista unit that's listed for a loss. I doubt this unit is worth more than the original developer price of $267,705.

Type: Listed on MLS(#076020008)

List Price: $275,000
(Range priced $275,000 to $275,000)
Cost: $307,000
Loss@6% Sales Expenses: $48,500
Loss%: 15.80%

Purchase Date: 04/12/2006
Holding Period: 12 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 628

Purchase Details: view

Large Loss on Luxury Downtown Condo at Harbor Club #2606

2007-03-31T11:03:00.000-07:00

Harbor Club is a twin tower development near the Bay and convention center.

This unit has a very interesting sales history as Harbor Club is one of the older projects downtown which yields a longer sales history for the units there. It is listed well below its last sale price from 2005.

This is more specific evidence that higher end properties are also sustaining losses.

Type: Listed on MLS(#076025720)

List Price: $799,000
Cost: $875,000
Loss@6% Sales Expenses: $123,940
Loss%: 14.16%

Purchase Date: 09/23/2005
Holding Period: 18 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 1036

Purchase Details: view

Downtown Condo at El Cortez #409

2007-03-28T11:18:00.000-07:00

The El Cortez is a rare historic condominium complex located on Cortez Hill.

The El Cortez is the subject of a lot of debate as the developer wants to add a second tower to the site. This unit is listed well below the developer sales price from the fall of 2004. At this point the El Cortez is likely another downtown condominium project in which all the units are worth less today than the original developer sales prices.

Type: Listed on MLS(#076024235)

List Price: $389,900
Cost: $445,000
Loss@6% Sales Expenses: $78,494
Loss%: 17.64%

Purchase Date: 10/08/2004
Holding Period: 29 months and counting...

Bedrooms: 1
Bathrooms: 2
Square Feet: 888

Purchase Details: view

$100K + Loss on Luxury Downtown Condo at Park Place #1305

2007-03-25T10:07:00.000-07:00

Park Place is a Bosa project in the Marina District.

This unit just sustained a $50,000 price cut. The new list price is now less than its last sale price in June of 2004 - nearly three years ago. I'd also add that I still hear and read the arguments that higher end properties have not declined in value. This property is a good example of a high end unit that has lost value.

Type: Listed on MLS(#076020447)

List Price: $849,900
(Range priced $849,900 to $849,900)
Cost: $900,000
Loss@6% Sales Expenses: $101,094
Loss%: 11.23%

Purchase Date: 06/23/2004
Holding Period: 33 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1353

Purchase Details: view

Downtown Condo at 350 W. Ash #701

2007-03-23T11:22:00.000-07:00

350 West Ash is a former office building that was converted into condominiums. It sits on the border between Little Italy and the Columbia District.

This unit is listed below its first sale price from July 2006.

Type: Listed on MLS(#076013677 )

List Price: $485,000
(Range priced $475,000 to $495,000)
Cost: $507,400
Loss@6% Sales Expenses: $51,500
Loss%: 10.15%

Purchase Date: 07/06/2006
Holding Period: 8 months and counting...

Bedrooms: 0
Bathrooms: 1.5
Square Feet: 846

Purchase Details: view

Bad Day at Acqua Vista

2007-03-21T12:33:00.000-07:00

I have a membership at foreclosure.com which updates foreclosure information on a daily basis. Today three units at Acqua Vista went into foreclosure. As noted on this blog I believe that virtually every unit at Acqua Vista is worth less today than K. Hovnanian sold the units for a few years ago.
View Downtown San Diego Foreclosures

Listing and Price Cut Activity Downtown

2007-03-20T07:48:00.000-07:00

SDLookup.com reports daily market changes, today the site is showing many new listings and price reductions.

I've also added their RSS feed to the blog on the right side. If you don't use RSS it is very useful new technology that lets you subscribe to your favorite sites without getting emails or having to go load the site everyday.

Also here is the RSS feed for this blog:

http://sandiegomarketmonitor.blogspot.com/feeds/posts/default

Downtown Condo at Discovery #1101

2007-03-19T11:36:00.000-07:00

Discovery is a Bosa Development project located on Cortez Hill.

This unit last change hands almost exactly two years ago and has generated a $100,000+ loss.

Type: Listed on MLS(#076021365)

List Price: $675,000
(Range priced $650,000 to $700,000)
Cost: $752,000
Loss@6% Sales Expenses: $117,500
Loss%: 15.63%

Purchase Date: 03/24/2005
Holding Period: 24 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1230

Purchase Details: view

Downtown Condo at Treo #502

2007-03-15T17:16:00.000-07:00

Treo is located in the Columbia District. This unit is listed below is sales price for 2006 which is interesting as the market was already starting to soften at the time.

Type: Listed on MLS(#066076864)

List Price: $624,938
(Range priced $600,000 to $649,876)
Cost: $670,000
Loss@6% Sales Expenses: $82,558
Loss%: 12.32%

Purchase Date: 02/09/2006
Holding Period: 13 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1281

Purchase Details: view

Downtown Foreclosure Boom?

2007-03-08T18:38:00.000-08:00

If you read the financial news then you're probably aware of the meltdown of the various sub-prime lenders that is taking place in the equity markets. The blog entries on specific properties on this blog and the foreclosure trend are directly linked to the financial problems the mortgage industry are having are directly related.

Foreclosure.com has a large number of properties showing as newly foreclosed. There are also a handful of new pre-foreclosures listed as well. Enter to see more information enter the zip code on foreclosure.com and browse around. They offer a free trial which will show more detailed information.

Downtown Penthouse Condo at Acqua Vista #1751

2007-03-08T08:11:00.000-08:00

Acqua Vista is located in Little Italy and has been discussed numerous times on this blog.

This property is one of the penthouse units. It's notable that it's listed for $40,000 less than the developer price set back in July of 2004. At this stage I suspect that virtually every unit at Acqua Vista is worth less than it's original developer price.

Type: Listed on MLS(#076018651)

List Price: $749,000

Cost: $790,291
Loss@6% Sales Expenses: $86,231
Loss%: 10.91%

Purchase Date: 07/29/2004
Holding Period: 32 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 1379

Purchase Details: view

La Jolla Condo at Country Club Place #2A - 7411 Herschel

2007-03-06T19:39:00.001-08:00

This La Jolla property is listed at a price that if sold will result in $100,000+ loss.

Type: Listed on MLS(#071000848)

List Price: $689,000
(Range priced $689,000 to $689,000)
Cost: $765,000
Loss@6% Sales Expenses: $117,340
Loss%: 15.34%

Purchase Date: 09/09/2004
Holding Period: 30 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1007

Purchase Details: view

Liberty Station "Lottery" Expose

2007-03-04T08:13:00.000-08:00

I'm sure that most market watchers observed the "lotteries" back in the boom days and if you were like me thought that whole process was somewhere between sales gimmick and poor ethics. The Union Tribune has published an interesting analysis on the situation.

It is a real shame that so many properties have sat totally vacant all this time.

Downtown Condo at Acqua Vista #1253

2007-03-02T08:18:00.000-08:00

Acqua Vista is an apartment conversion located in Little Italy. It was designed and developed as an apartment building and was sold midway through the development of the building to Hovnanian which then resold as then apartments as condominiums.

The sales history shows two sales, this listing is interesting as the list price is lower than the original developer price that the unit first changed hands at back in 2004.

Type: Listed on MLS(#076016765)

List Price: $369,900
(Range priced $369,900 to $369,900)
Cost: $430,000
Loss@6% Sales Expenses: $82,294
Loss%: 19.14%

Purchase Date: 04/11/2005
Holding Period: 23 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 661

Purchase Details: view

UPDATE: Downtown Condo at The Mills #522

2007-02-26T18:21:00.000-08:00

I'm updating a prior post on a unit at the Mills. The price has actually been increased on 2/22/2007 from $469,000-$499,900 to $479,000-$509,000 which is interesting as I don't think any of the loft units at the Mills have ever been resold and a number have been for sale for quite a long time.

The previous post is below with everything the same except the numbers have been updated.

****************************************************************

The Mills is an apartment conversion on Cortez Hill. The lofts units are probably the most over-priced real estate downtown so this price cut to a large loss comes as no surprise.

Type: Listed on MLS(#066083981)

List Price: $494,000
(Range priced $509,000 to $479,000)
Cost: $557,900
Loss@6% Sales Expenses: $93,540
Loss%: 16.77%

Purchase Date: 03/29/2005
Holding Period: 23 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 953

Purchase Details: view

Downtown Condo at Park Blvd East #305

2007-02-26T14:09:00.000-08:00

Park Boulevard East is located in the East Village.

This is a pretty standard unit for the building. It's very notable that the list price is less than the developer price at the first and only sale listed. As ICON, Park Terrace and Smart Corner continue to roll out this year the supply in that direct neighborhood will be very interesting.

Type: Listed on MLS(#076001768)

List Price: $464,000
(Range priced $459,000 to $469,000)
Cost: $491,824
Loss@6% Sales Expenses: $55,664
Loss%: 11.32%

Purchase Date: 06/21/2005
Holding Period: 20 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1034

Purchase Details: view

ICON Sales Update

2007-02-24T20:09:00.000-08:00

ICON is a multiple building development very close to Petco Park, construction is almost complete and people are moving into the complex now.

While this forum post can't be verified the size of their marketing effort and the current state of the housing market make these reasonable numbers.

327 Units Total
250 Approximately under contract
125 Closed Escrows
77 Unsold Units

My sense is that of the 125 contracted but unclosed escrows that a number of those will fail to close as well so let's figure that in within a month or so as the building is completely finished that 85-90 completed and unsold condos are entering the downtown market. That's about a 15% increase in supply relative to the current number of resale condos downtown.

Downtown Condo at The Grande #108

2007-02-23T13:18:00.000-08:00

This townhouse at The Grande is selling below its last sale price in the Spring of 2005.

The Grande is located in the Columbia District which is set to go through a significant change with a number of new projects coming including Electra, the Navy Broadway complex, Bayside at the Embarcadero. This is probably not enough to put a floor on the price declines but it will make things more attractive.

Type: Listed on MLS(#076008703)

List Price: $888,000

Cost: $930,000
Loss@6% Sales Expenses: $95,280
Loss%: 10.25%

Purchase Date: 06/30/2005
Holding Period: 20 months and counting...

Bedrooms: 2
Bathrooms: 3
Square Feet: 1890

Purchase Details: view

Mission Valley Condo at Mission Heights #103

2007-02-21T18:16:00.000-08:00

This Mission Valley condo is an example of a major value reduction from its last sale in 2004. The sales history shows a sale in June of 2003 for more than the low end of this range priced listing. It's quite expected for a basic condominium like this one to depreciate fairly quickly as the rent versus buy analysis is very easy to apply to a small one bedroom condominium in a non-premium location.

Thanks to Chris for pointing this property out via email

Type: Listed on MLS(#076003679)

List Price: $182,938
(Range priced $150,000 to $215,876)
Cost: $258,500
Loss@6% Sales Expenses: $86,538
Loss%: 33.48%

Purchase Date: 08/03/2004
Holding Period: 30 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 667

Purchase Details: view

Downtown Condo at Cityfront Terrace #409

2007-02-21T10:10:00.000-08:00

Cityfront Terrace is a mid-rise development in the Marina District.

This specific unit is listed below its last sales price from the fall of 2004. At this point we are seeing a lot of 2004 properties selling for a loss so it's probably safe to say there has been no appreciation in almost three years.

Type: Listed on MLS(#076014058)

List Price: $549,900

Cost: $585,000
Loss@6% Sales Expenses: $68,094
Loss%: 11.64%

Purchase Date: 09/20/2004
Holding Period: 29 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1104

Purchase Details: view

Massive Loss on Downtown Condo at Park Boulevard West #2402

2007-02-18T14:54:00.000-08:00

Park Boulevard West is a nondescript low rise in the East Village fairly close to Petco Park.

This unit last sold for $575,000 in the fall of 2004. The unit has a large list price range which likely indicates they won't be selling it for $400,000 but they are trying to get some attention. The loss calculation as usual is based on an average of the range pricing. All this said there really isn't anything compelling about this development or particular unit so about the only way to make it interesting is via price.

Type: Listed on MLS(#072013503)

List Price: $435,438
(Range priced $400,000 to $470,876)
Cost: $575,000
Loss@6% Sales Expenses: $165,688
Loss%: 28.82%

Purchase Date: 09/30/2004
Holding Period: 29 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1117

Purchase Details: view

Downtown Condo at Acqua Vista #1352

2007-02-16T13:17:00.000-08:00

Acqua Vista is a twin tower midrise in Little Italy. It was developed to be rental apartments and was converted into condominiums before the building was completed. This building was one of the first buildings downtown to start showing signs the housing market was cooling off.

This specific unit is selling for less than the developer price that it last changed hands at back in the summer of 2004. At this stage I suspect that every unit in the building is worth less than the developer price paid.

Type: Listed on MLS(#076012885)

List Price: $349,900

Cost: $375,313
Loss@6% Sales Expenses: $46,407
Loss%: 12.36%

Purchase Date: 08/19/2004
Holding Period: 30 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 655

Purchase Details: view

Downtown Condo at Village Walk #305

2007-02-15T09:22:00.000-08:00

Village Walk is located in the heart of Little Italy on India Street. We've seen a number of units there list for sale for less than last purchase price. The last time this unit changed hands was back in the summer of 2004.

Type: Listed on MLS(#076010001)

List Price: $629,000

Cost: $675,000
Loss@6% Sales Expenses: $83,740
Loss%: 12.41%

Purchase Date: 08/24/2004
Holding Period: 30 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 1260

Purchase Details: view

Bankers Hill Condo at Century Plaza Towers #6A

2007-02-14T14:02:00.000-08:00

This large condominium last changed hands in early 2004 for substantially less than today's list price.

Based on the MLS pictures there appears to be a recent upgrade as well. Finally the sales history at sdlookup.com is especially interesting. I think this illustrates very well the market value fluctuation of this particular property over the last several years.

Type: Listed on MLS(#076012363)

List Price: $502,000
(Range priced $475,000 to $529,000)
Cost: $610,000
Loss@6% Sales Expenses: $138,120
Loss%: 22.64%

Purchase Date: 05/14/2004
Holding Period: 33 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1470

Purchase Details: view

Rate of Condominium Conversions, Sales Continue Downward Spiral

2007-02-12T16:57:00.000-08:00

The San Diego Business Journal reports on condominium conversions in San Diego. No major surprises here and I agree completely with the forecast for more problems.

San Diego Business Journal Online article

UTC/La Jolla Condo at Verano #2014

2007-02-11T18:55:00.001-08:00

Verano is one of the many apartment conversion condominiums in the UTC area. There are still developer units available at Verano.

Type: Listed on MLS(#071011186)

List Price: $442,999
(Range priced $415,999 to $469,999)
Cost: $490,000
Loss@6% Sales Expenses: $73,581
Loss%: 15.02%

Purchase Date: 09/21/2005
Holding Period: 17 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1037

Purchase Details: view

Downtown Condo at El Cortez #506

2007-02-11T12:54:00.000-08:00

The El Cortez is located on the top of Cortez Hill. It started as a hotel, turned into apartments about six years ago and then was converted to condominums near the very top of the market.

In my view this unit is still overpriced.

Type: Listed on MLS(#076010236)

List Price: $500,000

Cost: $520,000
Loss@6% Sales Expenses: $50,000
Loss%: 9.62%

Purchase Date: 10/28/2004
Holding Period: 28 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1120

Purchase Details: view

Another Downtown Condo at Lofts at 777 6th Avenue #419

2007-02-09T11:00:00.001-08:00

Here's another unit at the Lofts at 777 6th Avenue.

Type: Listed on MLS(#076010280)

List Price: $669,000
(Range priced $649,000 to $689,000)
Cost: $731,000
Loss@6% Sales Expenses: $102,140
Loss%: 13.97%

Purchase Date: 10/04/2006
Holding Period: 4 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1119

Purchase Details: view

Downtown Condo at doma #302

2007-02-07T09:48:00.000-08:00

doma is a Citimark building in Little Italy, I would consider it a very high quality building.

Type: Listed on MLS(#070009335)

List Price: $529,900

Cost: $565,000
Loss@6% Sales Expenses: $66,894
Loss%: 11.84%

Purchase Date: 07/09/2004
Holding Period: 31 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 960

Purchase Details: view

Downtown Condo at Discovery #104

2007-02-06T11:27:00.000-08:00

Discovery is located on Cortez Hill and was built by Bosa Development in the earlier stages of the big development boom downtown.

This unit is interesting as I do recall when it was last sold, it was a relative bargain at the time and I also believe that it was listed for rent so this was probably an investment at the time.

Type: Listed on MLS(#076008970)

List Price: $587,938
(Range priced $575,000 to $600,876)
Cost: $605,000
Loss@6% Sales Expenses: $52,338
Loss%: 8.65%

Purchase Date: 01/11/2006
Holding Period: 13 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 1430

Purchase Details: view

$100K+ Loss on Downtown Condo at Treo #2300

2007-02-04T16:20:00.000-08:00

Treo is a mid-level quality high rise condo in the Columbia District.

This unit last changed hands in almost three years ago in June 2004.

Type: Listed on MLS(#060094421)

List Price: $848,000

Cost: $899,000
Loss@6% Sales Expenses: $101,880
Loss%: 11.33%

Purchase Date: 06/28/2004
Holding Period: 32 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 1337

Purchase Details: view

Downtown Condo at Fahrenheit #401

2007-02-03T10:25:00.000-08:00

Fahrenheit is in the ballpark district and is a CitiMark building. It's unique as the building wraps a parking garage. This gives the impression that there are a lot more units than there actually are.

This unit is interesting as it's selling below developer price, albeit this unit was probably sold in a later phase in the sales process.

Type: Listed on MLS(#076009690)

List Price: $679,500

Cost: $723,952
Loss@6% Sales Expenses: $85,222
Loss%: 11.77%

Purchase Date: 03/27/2006
Holding Period: 11 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1317

Purchase Details: view

Hillcrest Condo at The Egyptian #409

2007-02-01T10:56:00.000-08:00

The Egyptian is a recent condominium community located in Hillcrest on the border with North Park in the old Egyptian theater.

This is the second Egyptian condominium to make this list as unit #410 is also listed at a loss. This development was built by Citimark which puts out an excellent product so this loss is pretty much market forces driven.

Type: Listed on MLS(#066095991)

List Price: $559,000
(Range priced $549,000 to $569,000)
Cost: $617,539
Loss@6% Sales Expenses: $92,079
Loss%: 14.91%

Purchase Date: 07/19/2005
Holding Period: 19 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1431

Purchase Details: view

Downtown Condo at Metrome #814

2007-01-30T10:15:00.000-08:00

Metrome is located downtown San Diego Ballpark District development.

This unit has just taken a large price cut to below the price paid to the developer back in 2005. In my opinion this non-descript standard one bedroom condo is still overpriced.

Type: Listed on MLS(#066081452)

List Price: $395,000
(Range priced $380,000 to $410,000)
Cost: $461,700
Loss@6% Sales Expenses: $90,400
Loss%: 19.58%

Purchase Date: 11/04/2005
Holding Period: 14 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 735

Purchase Details: view

Lender Owned Pacific Beach Condo - 4600 Lamont - The Plaza #314

2007-01-29T20:31:00.000-08:00

This unit was built back in the 70s and has been on the market for awhile.

The price cut history shows a methodical price reduction from an optimistic price that was more than the unit last sold for in early 2004 to the current price. The sales history at sdlookup.com is also particularly interesting on this property.

Price Reduced: 09/27/06 -- $293,900 to $284,900
Price Reduced: 10/02/06 -- $284,900 to $279,900
Price Reduced: 10/24/06 -- $279,900 to $267,900
Price Reduced: 01/26/07 -- $267,900 to $249,900

Type: Listed on MLS(#066076476)

List Price: $249,900

Cost: $289,000
Loss@6% Sales Expenses: $54,094
Loss%: 18.72%

Purchase Date: 03/19/2004
Holding Period: 34 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 653

Purchase Details: view

Bankers Hill Condo at Cambridge Square #407

2007-01-26T11:07:00.000-08:00

This luxury condo on Bankers Hill is listed for exactly $100,000 less than the developer price set back in 2004.

Cambridge Square is a low rise mix of townhomes and condominiums on Nutmeg Street.

Type: Listed on MLS(#066045661)

List Price: $825,000

Cost: $925,000
Loss@6% Sales Expenses: $149,500
Loss%: 16.16%

Purchase Date: 12/20/2004
Holding Period: 25 months and counting...

Bedrooms: 2
Bathrooms: 2.5
Square Feet: 1768

Purchase Details: view

Downtown Condo at Crown Bay #605

2007-01-25T14:24:00.001-08:00

This two bedroom unit is listed below it's last sale price from the summer of 2004.

This building is a midrise property in the Gaslamp Quarter across from the San Diego Convention Center.

Type: Listed on MLS(#076006764)

List Price: $699,000

Cost: $735,000
Loss@6% Sales Expenses: $77,940
Loss%: 10.60%

Purchase Date: 08/11/2004
Holding Period: 29 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1024

Purchase Details: view

State mortgage default rates at eight-year high

2007-01-25T11:12:00.000-08:00

An extremely interesting statistic also comes to light in this today's Union Tribune article; "Most of the California loans that went into default last quarter were originated between January 2005 and February 2006, DataQuick reported. " Readers of the blog will recognize this time period as the most likely to be underwater. The market has clearly moved back to pre-2005 prices. I expect that we'll start to see a trend of more properties purchased in 2003 listed below purchase price.

I know a lot of people are hopeful that the downturn is over however I just don't see it happening in the short term. Affordability is still very low and the risk of buying overpriced property is very apparent to regular people on the streets. Prices need to continue to correct to a point where the disparity between buying and renting returns to pre-2002 levels.

UPDATE Foreclosed Downtown Condo - Park Boulevard West #1110

2007-01-24T11:35:00.000-08:00

Park Boulevard West is located in the East Village/Ball Park District, note there are several new projects coming online with brand new units that are unsold. The price action in that part of the downtown market should be quite interesting in 2007.

This property has been on the market for awhile and had just sustained another $30,000+ price cut.

This latest price cut moves the list price of the unit very close to the original developer price set almost three years ago.

The price cut history is also of interest:
Price Reduced: 09/28/06 -- $364,900 to $358,900
Price Reduced: 10/02/06 -- $358,900 to $354,900
Price Reduced: 10/20/06 -- $354,900 to $344,900
Price Reduced: 11/24/06 -- $344,900 to $332,900
Price Reduced: 01/23/07 -- $332,900 to $299,900

More details about this and thousands of other properties availabe at Foreclosure.com

Type: Listed on MLS(#061069101)

List Price: $299,900

Cost: $380,000
Loss@6% Sales Expenses: $98,094
Loss%: 25.81%

Purchase Date: 11/05/2004
Holding Period: 26 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 689

Purchase Details: view

Big Loss on La Jolla Property - 2130 VALLECITOS 92037

2007-01-22T19:25:00.000-08:00

The MLS listing says this ocean view unit has been newly refurbished and is tenant occupied.

The price history at sdlookup.com is especially interesting on this one.

Type: Listed on MLS(#066100332)

List Price: $899,500

Cost: $1,050,000
Loss@6% Sales Expenses: $204,470
Loss%: 19.47%

Purchase Date: 03/28/2005
Holding Period: 22 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1342

Purchase Details: view

Downtown Condo at Discovery #804

2007-01-21T10:06:00.001-08:00

This two bedroom unit at Discovery is listed below its last sale price from 2004.

Type: Listed on MLS(#061092272)

List Price: $599,900

Cost: $618,000
Loss@6% Sales Expenses: $54,094
Loss%: 8.75%

Purchase Date: 12/17/2004
Holding Period: 25 months and counting...

Bedrooms: 2
Bathrooms: 2

Purchase Details: view

Three Losses at Lofts at 777 6th Avenue

2007-01-18T19:43:00.001-08:00

Readers of this blog will remember a post or two on the lofts at 777 6th Avenue where future losses were speculated. The project was developed as rental apartments and were converted into condominiums a few years ago. The project does not appear be sold out. In addition there are three resale units that are listed for at losses to the current owners.

The three losses are below:

Unit #209

Type: Listed on MLS(#066087611)

List Price: $395,000

Cost: $441,000
Loss@6% Sales Expenses: $69,700
Loss%: 15.80%

Purchase Date: 10/11/2006
Holding Period: 3 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 725

Purchase Details: view

Unit #236

Type: Listed on MLS(#066102911)

List Price: $395,000
(Range priced $385,000 to $405,000)
Cost: $440,000
Loss@6% Sales Expenses: $68,700
Loss%: 15.61%

Purchase Date: 10/20/2006
Holding Period: 3 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 700

Purchase Details: view

Unit #425

Type: Listed on MLS(#066100209)

List Price: $554,000
(Range priced $539,000 to $569,000)
Cost: $619,000
Loss@6% Sales Expenses: $98,240
Loss%: 15.87%

Purchase Date: 10/20/2006
Holding Period: 3 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1002

Purchase Details: view

Downtown Condo at Diamond Terrace #1209

2007-01-16T20:09:00.000-08:00

Diamond Terrace is located in the Ballpark District.

This unit bought at a substantial premium to the original developer price. This isn't too surprising as most condominium projects take orders a few years before delivery. That said the second buyer's experience isn't working out too well.

Type: Listed on MLS(#066079139)

List Price: $507,500
(Range priced $495,000 to $520,000)
Cost: $530,000
Loss@6% Sales Expenses: $52,950
Loss%: 9.99%

Purchase Date: 12/07/2005
Holding Period: 13 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 826

Purchase Details: view

Downtown Condo at M2i #512

2007-01-15T19:02:00.000-08:00

M2i is a loft project in the East Village and was built by CitiMark development.
This is the second loss at M2i noted on this blog. It's also notable that there are a handful of units still for sale by the developer.

Type: Listed on MLS(#076000656)

List Price: $535,000

Cost: $549,900
Loss@6% Sales Expenses: $47,000
Loss%: 8.55%

Purchase Date: 03/02/2006
Holding Period: 10 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1126

Purchase Details: view

Downtown Condo at Palermo #509

2007-01-13T10:19:00.000-08:00

Palermo is a low rise condominium technically located in Cortez Hill, since it's across the street from the Little Italy many fairly consider this development as being located in the more attractive Little Italy neighborhood. Palermo was developed to be "workforce housing" which based on my viewing of the quality there I interpret as low to middle level rental apartments. This project is similar to Acqua Vista, The Mills and Portico as they were all newly developed rental projects that were converted to condominiums at the height of the boom.

This unit is listed at a nearly $100K loss and priced less that the developer price from 2004.

Type: Listed on MLS(#076003016)

List Price: $534,900

Cost: $596,970
Loss@6% Sales Expenses: $94,164
Loss%: 15.77%

Purchase Date: 10/29/2004
Holding Period: 27 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1106

Purchase Details: view

Major Default on an Apartment Conversion

2007-01-11T09:33:00.000-08:00

As has been speculated on this blog in the past this news item from the Union Tribune is a very interesting read. A mechanics lien is pretty much a sign that that the contractors are not being paid. This is a sure sign of cash flow problems at the project and probably the developer level.

When a loss is taken on a loan like the bank is going to write off the losses and reset prices lower or put the project back into the rental market via a sale to an apartment operator. Either way it likely won't be sitting dormant for long.

I suspect that this will not be the last story of this variety that we'll be reading in 2007.

Also notable is discussion of some other troubled developments.

Downtown Condo at The Grande #3305

2007-01-10T16:27:00.000-08:00

The Grande is a twin tower Bosa development located on the harborside of the Columbia District.

This unit has just had a $100,000 price cut which has put it below it's prior market valuation set in the spring of 2005, nearly two years ago.

Type: Listed on MLS(#066100855)

List Price: $1,299,000

Cost: $1,315,000
Loss@6% Sales Expenses: $93,940
Loss%: 7.14%

Purchase Date: 05/06/2005
Holding Period: 20 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1625

Purchase Details: view

Downtown Condo at ParkLoft #304

2007-01-09T18:42:00.001-08:00

ParkLoft is located by Petco Park. It was an early project in the East Village area.

This particular unit sustained a recent $140,000 price cut which and is substantially lower than the last sale price in the summer of 2004.

Type: Listed on MLS(#066074284)

List Price: $559,000

Cost: $650,000
Loss@6% Sales Expenses: $124,540
Loss%: 19.16%

Purchase Date: 08/31/2004
Holding Period: 29 months and counting...

Bedrooms: 0
Bathrooms: 1.5
Square Feet: 1305

Purchase Details: view

Foreclosed Mission Valley Home at Escala - 2641 Villas Way

2007-01-06T09:13:00.000-08:00

Escala is located in the heart of Mission Valley.

This property has a lot going on:

$100K+ loss

Bank Foreclosure

Listed below the developer price from over two years ago

In addition this property has sustained the follow price reductions:

Price Reduced: 09/15/06 -- $619,900 to $599,900
Price Reduced: 10/17/06 -- $599,900 to $584,900
Price Reduced: 11/29/06 -- $584,900 to $569,900

Search for pending and fully foreclosed properties on Foreclosure.com

Type: Listed on MLS(#066074814)

List Price: $569,900

Cost: $637,554
Loss@6% Sales Expenses: $101,848
Loss%: 15.97%

Purchase Date: 12/10/2004
Holding Period: 25 months and counting...

Bedrooms: 3
Bathrooms: 2.5
Square Feet: 1425

Purchase Details: view

Thanks to an anonymous poster on the www.sdlookup.com forums for finding this property.

Downtown Condo at Lusso Lofts #7

2007-01-05T21:32:00.001-08:00

Lusso Lofts is a former rental apartment project in Little Italy that was converted into condominiums. There are likely still some developer units for sale as well.

This large one bedroom unit has been on the market for almost two months and has had a recent $10,000 price cut.

Type: Listed on MLS(#068095020)

List Price: $455,000
(Range priced $440,000 to $470,000)
Cost: $499,900
Loss@6% Sales Expenses: $72,200
Loss%: 14.44%

Purchase Date: 04/14/2006
Holding Period: 9 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 800

Purchase Details: view

Hillcrest Condo at The Egyptian #410

2007-01-02T19:46:00.000-08:00

The Egyptian is a recent condominium community located in Hillcrest on the border with North Park at the site of the the old Egyptian theater.

Besides the rather large loss this property is notable as the list price is less than the developer sold the unit for back in 2005.

The list price was reduced on 12/04/06 from $765,000 to $700,000.

Type: Listed on MLS(#061079777)

List Price: $700,000

Cost: $727,879
Loss@6% Sales Expenses: $69,879
Loss%: 9.60%

Purchase Date: 07/28/2005
Holding Period: 18 months and counting...

Bedrooms: 1
Bathrooms: 2.5
Square Feet: 1556

Purchase Details: view

Big Loss on Foreclosed Downtown Condo at Park Blvd West #1105

2006-12-31T15:17:00.000-08:00

Park Boulevard West is a low rise condominium in the East Village. This unit has sustained a substantial loss and is owned by the bank that loaned the money for this unit to the last owner.

More details about this and thousands of other properties available at Foreclosure.com

Type: Listed on MLS(#066101451)

List Price: $450,000

Cost: $535,000
Loss@6% Sales Expenses: $112,000
Loss%: 20.93%

Purchase Date: 11/24/2004
Holding Period: 25 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 910

Purchase Details: view

2007 Predictions

2006-12-29T06:15:00.000-08:00

I started this blog in April of this year and nearly 200 posts later we find ourselves in a real estate market that has made a significant change in direction. I had been predicting this in other forums and with friends and colleagues for awhile which makes the market move not a surprise for myself however given that this was a very unpopular prediction I feel somewhat vindicated.

At any rate I am going to diverge from my usual posts featuring price action on specific properties and market news to make some predictions for 2007.

1.) San Diego property will continue to decline in value with condos continuing to lead the movement down. This decrease will range from 5-25%.

2.) Downtown condos will depreciate another 10-25% in another slow and orderly decline similar to how 2006 played out. Quality will be key in terms of holding value.

3.) At least one more downtown condo project will go rental before completion. As noted on this blog the former Broadway Lofts condominiums has reverted to a rental project. A potential candidate for going the rental route is Solara Lofts which is an office building conversion project that should be finished by early summer, since sales haven't started yet it may be prudent for them to pull the development off of the market until prices stabilize.

4.) The massive number of new urban condos coming will continue to impact price declines in the attached sector of the market, however since many of the developers will decide to carry inventory for 3-6 months after project completion and since the natural tendency for construction projects to take longer than scheduled the inventory increase and price declines continue into 2008.

In summary the decline trend continues for 2007 with a bottom in the market pushed out past the coming year. A significant wildcard are interest rates which could drive a quicker decline if the one two punch of materially higher rates combined with adjustable mortgage resets combines to drive more foreclosure and short sale activity.

Have a great new year!

Downtown Condo at Treo #600

2006-12-21T19:52:00.003-08:00

Treo a high rise developed located in the Columbia District, while close to Little Italy it is often misrepresented as being located in the more popular Little Italy. This may change as the Navy Broadway complex revamps the neighborhood into a much nicer destination. The train is awfully loud as well and that is supposed to be fixed by CCDC at some point in the future.

This particular unit is listed below it's late summer 2005 price.

Type: Listed on MLS(#066090885)

List Price: $695,000
(Range priced $675,000 to $715,000)
Cost: $750,000
Loss@6% Sales Expenses: $96,700
Loss%: 12.89%

Purchase Date: 09/07/2005
Holding Period: 15 months and counting...

Bedrooms: 2
Bathrooms: 3
Square Feet: 1337

Purchase Details: view

Luxury Downtown Condo at Harbor Club #2304

2006-12-19T18:10:00.000-08:00

Harbor Club is a twin tower development in the Marina District on the border with the Gaslamp Quarter. This project is often referenced as the one that was developed and ended up vacant with condos sold at auction during the last real estate market downturn.

This unit has recently endured a price cut which has generated a large loss.

Type: Listed on MLS(#066064731)

List Price: $1,399,000

Cost: $1,490,000
Loss@6% Sales Expenses: $174,940
Loss%: 11.74%

Purchase Date: 12/22/2005
Holding Period: 12 months and counting...

Bedrooms: 2
Bathrooms: 2
Square Feet: 1572

Purchase Details: view

Downtown Condo at Cityfront Terrace #1705

2006-12-18T11:46:00.000-08:00

Cityfront Terrace is a mid rise building located in the Marina District. This project is unique as it was developed during the prior real estate boom and ended up as rental project for a number of years as the condo market crash at the time made selling the building as condominiums unfeasible.

This particular unit is listed for sale below its prior price sales price from the summer of 2004. The MLS listing is offering an additional $4,500 for closing costs which is not factored into the loss calculation below.

The unit has endured the following price cuts:
Price Reduced: 08/11/06 -- $535,000 to $525,000
Price Reduced: 08/22/06 -- $525,000 to $500,000

Type: Listed on MLS(#066055232)

List Price: $507,500
(Range priced $500,000 to $515,000)
Cost: $532,000
Loss@6% Sales Expenses: $54,950
Loss%: 10.33%

Purchase Date: 07/21/2004
Holding Period: 29 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 975

Purchase Details: view

Bank Foreclosed Downtown Condo at Trellis #519

2006-12-14T20:17:00.000-08:00

Trellis is located at the end of 5th Avenue in the Gaslamp.

This unit has changed hands twice with the second buyer going into foreclosure. This unit listed on foreclosure.com.

Based on the below list price activity it appears that bank actually tried to sell this unit for more than the last sales price but has quickly cut the price to below the prior transaction price.

Price Reduced: 11/06/06 -- $439,900 to $384,900
Price Reduced: 12/05/06 -- $384,900 to $374,900

Type: Listed on MLS(#061087982)

List Price: $374,900

Cost: $409,000
Loss@6% Sales Expenses: $56,594
Loss%: 13.84%

Purchase Date: 08/26/2005
Holding Period: 16 months and counting...

Bedrooms: 1
Bathrooms: 1
Square Feet: 678

Purchase Details: view