Sunday, March 24, 2013

Crazy Alameda Real Estate

Let's talk serious about the state of Alameda Real Estate.
I mean, what the hecks going on?

Crazy Micro-Bubble 
I've been talking to several families looking to buy a house in Alameda. They keep getting shut out of the bidding. One recent sale went famously for $100k over asking!
There are just basically no houses on the market. In all of Alameda there are less than 30 houses on the market.
From talking to people here's what I believe is happening, its a bit of a perfect storm for Alameda real estate.
Very low inventory, very low interest rates and wealthy-ish folks coming over from Frisco to buy houses in Alameda.
I spoke with one wealthy-ish family and they were 0-24 in bidding on houses in Frisco! They are fed up with the situation there and came to Alameda where their real estate bucks would go farther.
I believe that they are not the only people in that situation.
Alameda used to be sorta a 'hidden gem' but its been discovered by wealthy-ish folks who would normally want to live in Frisco.

How You Can Get a House in Alameda
From talking to several Realtors here's what I think you have to do to score a house in this're not going to like it.

First, this is not the market for 'first time home buyers'. Sorry guys but you're screwed. FTHB's in my experience just don't have the ability to make a quick decision and that's what you're going to have to do in our current market.

Second, have a VERY clear and FIRM idea of the type of house you want and what areas are acceptable to you.

Third, have all your ducks in a row. Be pre-approved for a loan, have a big fat wad of cash ready to go for a down payment.

Fourth, Have a Realtor that is worth their salt. Your Realtor should know every house on the island that's for sale that fits your requirements. They should have their ear to the ground for houses that will be on the market in the near future. This last one is the most important because I think that there are only two ways to get a house in Alameda.
1. Make a 'pre-emptive' offer on a house that is not yet officially on the market.
2. Your agent should be taking you to the brokers open to any house you're interested in and you should make an offer right then and there.

If you're very lucky the home owner will decide that your offer is better than the hassle of having open houses and waiting. Even in these scenarios you will have to offer over asking.

How Come You Haven't Done A Knife Catching Review In A While
1. Haven't been many interesting houses on the market recently. Or any houses really.
2. Houses are selling too fast! I'd have to go to the brokers open to tour the place and take my pictures. Think I'd be welcome there? Me and a house FULL of Realtors? The phrase 'Tar and Feathered' comes to mind.
3. I've been busy with other stuff. The usual picture filled review takes me at least 3 hours to put together.

But don't worry, I'm getting the sense that the micro-bubble we're in is going to start bringing out the charlatans and hustlers again....

But Wait, There's More
Through the blog I've been approached by several strangers to review houses for them that they were seriously interested in. So, I've done a couple of 'private reviews' on a commission basis. If you think something like that might interest you please contact me through the email link in my profile.


Anonymous said...

It is crazy out there and since I'm not wealthy, I can't compete.

Even the rental market in Alameda is crazy.

When are you going to finish your basement apartment so I can rent so the kids can attend Franklin. =D

Also, I would love to see those commission reviews. Did any buyers back out after your review?


The MadScientist said...

Hi Mary,
I know that I've set completion dates before and completely, hopelessly blown through them...but, I hope to have it done and be looking to rent it out by the end of summer. It just depends on if we can afford to hire help.

On the commission reviews...
My policy is that the commissioner and the content is private. IF the commissioner chooses to share it thats their business.

On the back-out question...
My for commission reviews are much, more complete than the reviews I do here on the web. Besides what you would typically read here, whats right/wrong with the house and how much it will cost to fix it there is a section on the permit history and unpermitted work issues, theres a section on what school they're in and its grade compared to the other schools, theres a section on the relative safety (crime stats) of the 'hood and how it compares to others and then sorta a page on my general opinion of the 'hood and whats good/bad about it and how it compares to other 'hoods on the island. In short, everything that someone looking to buy a house here needs to know but won't be told by the Realtor or the inspectors who are in the Realtors pockets.
With that kind of info in hand, it has made everybody seriously second guess themselves.

Wow, I think that was my longest reply ever...

D said...

I know of at least one Bronze Coast vic that went $150,000 over asking in November. Crazy town.

The MadScientist said...

That's surprising,
I didn't think the craziness started until well into this year.

Anonymous said...

One current listing in particular, I believe, will be a test of the limits of our so-called bubble.

It's 3100 Thompson, and at first I thought the listing price was a joke - $779k for 1,345 sqft. If it sells for asking, then we are in an ABSURD bubble. But I don't think it will. They just had a second open house, which is rare these days.

In this case, I think the Realtor overshot the mark by a LOT, posting it at $580/square foot. $580! For a 2/1 shoe box! With a tiny yard right off high Street! And terrible traffic during the holidays!

But we'll see. Desperate times call for desperate bids. Maybe there's a buyer who loves hip Alameda and the Edison school district that much...

The MadScientist said...

Yes that place on Thompson does seem a bit wacky-priced.
I still say that if 1531 Morton sells for anywhere near asking that, that means we are in a crazy bubble.
Is that the xmass tree lane part of Thompson? If you were an xmass nut then maybe it would be worth it??
We wanted to move to our current 'hood cause we're Halloween nuts!