Saturday, July 15, 2006

Mill Valley Proof of a RE Bubble

Appeal, location and opportunity! Wonderful home or investment property or weekend get-away. Fabulous views of the bay and bridge. This one level home has great light, open beam ceilings, new carpet, large deck, covered parking and extra storage. Great lot with level yard area.
A dear friend of mine, who lives in the neighborhood of this 1 br 1 ba Mill Valley house, knew the lady who lived there and recently passed away. I was visiting the other day and so we decided to walk up to this house and look around.

Truly, this place is a dump. It is incredibly small (we estimate less than 600 sq ft of living space). It is nothing. It is a box. Nothing has been done to this house other than the heirs have cleaned it up (the lady had piles and piles of junk all over the place; accumulated stuff from over the years) and fixed the plumbing and the septic system. Not shown in the picture, attached and to the left, is the one car carport.

It was originally listed at $1,100,000 and now is listed at $999,000.

You really have to see this place in person to get a grasp of how ludicrous that asking price is and how small 600 sq ft really is; looking at a picture just isn't enough and in fact the picture makes this POS seem larger than it really is. A million dollars is a mind boggling amount of money to pay for something like this.

If ever there was proof of a housing bubble in Marin then this would have to be it.

(Incidentally, in case you are wondering why the lady didn't just sell the house a few years back and move and live her last few years "in style": my friend, who has lived his whole life on that street and who lives practically next door to this POS, told me that she said "it's paid for and it's my home, not an investment". That is an indication to you readers of the sort of people who used to live here (in Marin) in much greater numbers -- down-to-earth folk whose lives were not dominated by money or get rich quick schemes or displays of wealth.)

(Also, there is a house just like this one, except it's grey, to the left of this yellow one. These two houses appear to have been built by the same person. They are very close to each other and there is no wall or fence separating the two properties. In fact, they are so close to each other and essentially identical in style that it really looks like they were originally built on the same lot, possibly as rentals.)

(Further, you can only just barely see the bridge in the "view" that the realtor makes such a woop-de-doo about. The view is dominated by two large trees (not Redwoods but of similar height and girth) that have been allowed to grow to such a height that you can no longer see much of the view anymore. As time passes it is unlikely the view will improve as my friend says the owner of the two trees has no intention nor requirement of either topping them or cutting them down. So, if you buy this POS for the so-called view, then plan on enduring months if not years of dispute with one of your neighbors who has already been through it a few times with other neighbors.)

15 Comments:

Anonymous ross valley lurker said...

we estimate less than 600 sq ft of living space

By this example, being a confident Marin home seller means never justifying the value of anything, even a scant 600 sqft.
Consider this a challenge, home sellers, to upstage this one: you can do it.

July 16, 2006 11:13 PM  
Anonymous Anonymous said...

Ha, you said "sceptic" system.

July 17, 2006 9:28 AM  
Blogger marin_explorer said...

"600 sq ft of living space...is listed at $999,000."

::blank stare::
I've run out of scathing comments.

July 17, 2006 9:32 AM  
Blogger Marinite said...

Oops, that should be "septic" as in:

1. Of, relating to, having the nature of, or affected by sepsis.
2. Causing or producing sepsis; putrefactive

July 17, 2006 9:49 AM  
Blogger SF Mechanist said...

It's only a rediculous housing bubble if somebody buys it.

July 17, 2006 6:59 PM  
Blogger sf jack said...

marinite -

Isn't it time for another "Golden Turd Award" vote?

We've had a lot of good candidates since the last vote.

July 17, 2006 8:44 PM  
Blogger Marinite said...

jack -

I think you are right. Any nominations?

July 17, 2006 8:55 PM  
Blogger rejunkie said...

That is an indication to you readers of the sort of people who used to live here (in Marin) in much greater numbers -- down-to-earth folk whose lives were not dominated by money or get rich quick schemes or displays of wealth

...except for the little old lady who wants $1500/sf for a "non-investment". Hubris does not discriminate based on age.

July 18, 2006 10:42 PM  
Blogger Marinite said...

...except for the little old lady who wants $1500/sf for a "non-investment".

She's dead. It's her heirs who are asking for that $1500/sq ft. And what do they care? They live somewhere else.

July 19, 2006 9:53 AM  
Blogger Marinite said...

And doesn't that work out to $1665/sq ft?

July 19, 2006 2:37 PM  
Blogger sf jack said...

"I think you are right. Any nominations?"

Hmmm... there's so many "good" ones. I'll have to get back to you.

And how about nominations from others?

fred?
explorer?
lurker?
junkie?
anonymous #302,398?

July 19, 2006 8:40 PM  
Blogger rejunkie said...

She's dead. It's her heirs who are asking for that $1500/sq ft. And what do they care? They live somewhere else.

Touche. I am sure she was quite the upstanding citizen whose only mistake was having greedy offspring. God rest her soul.

BTW, Haunted House of San Anselmo (135 Laurel) has to get a nomination. That was firewood -- firewood that sold for $819k:
http://www.westbayre.com/frame_main.htm

But then there is Kentfield Biohazard, She's Gonna Blow In Fairfax, Shack On A Stick in San Anselmo, Mill Valley Outhouse... So many PoS'. I think the ones that are unliveable (gas masks required, waiver forms for entering, yellow caution tape, etc.) should be at or near the top of any list. In this market, there is NO reason a buyer should settle for anything in less than pristine condition.

July 19, 2006 9:24 PM  
Blogger marin_explorer said...

there is NO reason a buyer should settle for anything in less than pristine condition.

So true! For $5K+ /mo, a buyer should have a measure of comfort and quality. Personally, I think Sonoma co. has a worse case of price entitlement than Marin, given its distance from a signficant job base.

Case in point was this modest craftsman bungalow (1500sqft) we visited in Sonoma co. For $77OK, we at least expected a good level of renovation and comfort. Instead, we found an abysmal level of maintenance and detail--with a kitchen straight out of the Depression. It's all a joke now.

July 21, 2006 10:12 AM  
Blogger Marinite said...

It's all a joke now.

Sellers in Marin and Sonoma (and probably Napa and SFO too, heck, the whole Bay Area) are in denial. Classic bubble unwinding.

July 22, 2006 10:16 AM  
Anonymous Anonymous said...

I believe that Marin County and most of the Bay area cities will see less of an immediate decline than other more "average wage" cities like Sacramento. San Diego County is having it's fair share of medicine right now, and could more than likely follow Sacramento's quick demise. However, if anything upsets the US economy in the next 6 months, then the speculators will be less inclined to give it "one more chance" and well see prices really start to fall due to lack of demand and increase in inventory.

It will be slow here, but I see prices falling 25% percent at least if not more within the next 3 years or less. Higher priced >$ 1 mil will definately see a huge decline. Save your cash and read "Irrational Exuberance" by Robert Shiller.

July 26, 2006 11:48 AM  

Post a Comment

Links to this post:

Create a Link

<< Home