Housing Containers

Hat tip to clearfund for sending this along – isn’t it just a matter of time before we’ll see these here being used for low-income and/or senior housing?

It seems difficult to overstate the versatility of the humble shipping container. Just recently we’ve seen it used to create a pop-up shopping mall and a touring kitchen; past sightings have included restaurants, pop-up health clinics, and hotel rooms.

The latest spotting? Citihub Mandaluyong, a dormitory in the Philippines that’s built from shipping containers and designed for low-income workers and students.

The brainchild of Manila’s Arcya Commercial Corporation, Citihub Mandaluyong is situated on a stretch of land in Mandaluyong along the Pasig River, according to a report on the Manila Bulletin. Four shipping containers make up the dorm, which includes separate air-conditioned housing and bathrooms for men and women. Pricing is just PHP 1,500 per month including water and electricity. (about $35US)

Besides fulfilling what’s clearly a pressing unmet need, Citihub Mandaluyong is also a perfect example of what our sister site would call a functionall offering — one that’s simple, inexpensive and designed primarily with low-income consumers in mind. It also seems ripe with global potential; one to emulate in your neck of the woods?


Let’s Try a Foreclosure Blowout!

We need market clearing – bring on the foreclosures! From CNNMoney.com:

If the Obama administration really wants to save the housing market, it should speed up the foreclosure process — not prolong the inevitable, experts say.

Four years into the housing crisis, the real estate market is still teetering on the edge. The Obama administration has tried one program after another to stem the tide of foreclosures with limited success. And it is continuing to look for ways “to ease the burden on struggling homeowners,” though no new initiative is imminent, the White House said this week.

But some housing experts argue that the administration should go in a different direction than it has in the past. Instead, they say it’s time to focus on pushing many of those delinquent borrowers through the foreclosure process and putting foreclosed properties back into use.

While some of the 2.2 million loans in foreclosure can still be saved, many are too far gone, they say. Some 37% have not made a payment in more than two years, while another 34% have not made a payment in 12 to 23 months, according to Lender Processing Services.

“Loans enter into foreclosure, but never come out,” said Thomas Lawler, founder of Lawler Economic & Housing Consulting. “If this keeps going on, you have a continual overhang that never goes away.”

Delaying foreclosure increases the percentage of homeowners who’ll likely never catch up, Lawler said. In 2009, only 6% of delinquent borrowers were more than two years behind. And it means vacant properties still in limbo could fall even further into disrepair, hurting the value of the surrounding housing market.

Lawler is not the first to warn about the consequences of slowing the foreclosure process. Since the housing crisis began, several experts cautioned that foreclosure prevention efforts may only prolong the pain.


San Diego C-L Price Data

These guys aren’t as famous as Case-Shiller yet, but they employ a similar tracking of same-house repeat sales around the country (they have 45 million observations on file!). 

Here are the changes in their HPI year-over-year for the San Diego County single-family detached properties – as a county, it looks like we gave back most of what was gained since early 2009:

Rollaway Garage Door

Hat tip to Daniel (theotherone) who sent this in from Curbed, via Yahoo:

A Curbed SF reader sent us the above video of a magical garage door in the Upper Haight.

McMills Construction was working on an investment property on Oak Street, and they were scratching their heads over how to build a garage to enhance the tenant’s use of the building.

As we all know, it’s nearly impossible to consistently score a decent parking spot in the Upper Haight. The problem, you see, is that the city planning department had recently started enforcing its mandate to limit changes to the character of historic building’s front facades — especially when it came to converting bay windows into garage doors.

Corey McMills, who’s got a background in mechanical engineering, thought of an idea to covert the walls of the bay window into door panels that would fold into the garage space to allow cars to enter. The planning department accepted it. McMills Construction teamed up with Beausoleil Architects to help with the details. The result is brilliant.

Architectural Magic [Beausoleil Architects]


Hat tip to duncbdunc for sending this along from the Atlantic, written by senior editor Megan McArdle – who isn’t a realtor!

So since we became homeowners, I’ve become more interested in HGTV.  Not obsessively so, but I have more interested in watching programs about renovations and such.

One of the shows I’ve watched is called “Property Virgins”.  The plot is about like it sounds: first time homebuyers try to find a place.

What’s interesting is how many of the homeowners have trouble getting their offers accepted.  The shows filmed post-crash, and while it’s by no means universal, a number of the couples on the show put in an offer only to lose the house . . . and a substantial minority put in offer after offer, only to lose again and again.  And what’s really interesting is that this happens in places like Florida and California, where you would think it would be easy to find a house.

I wonder if they aren’t experiencing something like I described when we were hunting for a house.  In the neighborhoods we wanted to buy in here, there was a lot of inventory–homes that were wildly overpriced.  Those homes sat on the market for months, even years.  Meanwhile, anything that came on at a reasonable price went to contract within a week, and usually within a couple of days–we made an offer on the house we now own the day it came on the market, and this was far from unusual.  Bidding wars on these properties were frequent–universal, in the months before the first-time homebuyer tax credit expired.

This sort of rapid-fire bidding is bubble behavior; it’s not supposed to characterize a normal market. While well-priced houses always sell faster, this level of bifurcation is extreme (or so my real-estate agent mother assures me).  She also assures me that putting things on the market high, and then lowering your price if it doesn’t sell, is lousy strategy–once something’s been on the market for a while, it’s damaged goods.  Price reductions don’t get the same enthusiasm as new listings, so if your house is wildly overpriced, you’re going to end up selling it for less, not more.

But this bifurcated market makes sense in the context of the housing crash.  It even makes sense that I’m noticing the phenomenon in places where housing prices have fallen the furthest: states like California and Florida, and beginning-to-gentrify neighborhoods like mine, which got bid up at the height of the bubble, and then fell by around a third.

Those are, of course, the places where homeowners are most likely to be upside down on their mortgages.  But that doesn’t really explain the phenomenon–if you need to sell, then arrange for a short sale or give it back to the bank, while if you don’t, why put it on the market at a price that no one will take?  And why do a surprising number of the homes that come on the market languish for so long without a price reduction?

Because prices are sticky, and they are stickiest where the needed reduction is largest.  The owners of these houses simply cannot bring themselves to believe that they took a loss.  They will instead drop their house on the market 20-30% too high, or more.  Even when it’s obvious that no one is going to buy at their price, loss aversion prevents them from admitting that it isn’t going to happen–either by dropping the price, or taking the thing off the market.  The result is that a normally-sized population of buyers gets compressed into the relatively small number of houses that are a) coming on the market at b) a price that recognizes that it’s no longer 2006.

This suggests that even as housing demand recovers, it’s going to take a while for the markets to follow suit.  A lot of the stock isn’t even coming on the market; a lot more isn’t priced to sell.  Until circumstances force a sale–or the buyers bid up that limited turnover to 2006 prices–those houses will sit there.  Meanwhile, frustrated buyers will feel like it is 2006–as they lose house after house until they manage to make the first offer.

Case-Shiller San Diego June ’11

The latest San Diego Case-Shiller Index went up or down, depending on whether you are looking at seasonally-adjusted or not:

Month Sea.Adj Non-SA
May ’11
June ’11

The first three paragraphs from cnbc.com, who buried the story within a couple of hours behind the travel woes of Irene:

Spring buying pushed home prices up for a third straight month in most major U.S. cities in June. But the housing market remains shaky, and further price declines are expected this year.  The Standard & Poor’s/Case-Shiller home-price index shows prices  increased in June from May in 19 of the 20 cities tracked.  A separate figure shows prices rose 3.6 percent in the April-June quarter from the previous quarter. Those numbers aren’t adjusted for seasonal factors.

Mr. Ivory Tower, David the Dog Blitzer, was happy to chime in with his normal two cents too:

Despite the uptick, the numbers contain “really no hope of any kind of surge,” S&P Index Chairman David Blitzer told CNBC.  “None of the fundamentals look that good,” he said. “People still have difficulty getting mortgage loans, they still have difficulty in refinancing. The banks got a lot tougher and haven’t gotten any easier no matter how you measure.”

Blitzer said the housing market is taking on a more regional perspective, with the Sun Belt continuing to languish and other areas of the country stabilizing.  “You have to look much more into details,” he said. “You’ll some good times here and there but it’s a thin river of hope overall.”

Who has trouble getting mortgage loans? People who don’t qualify? GOOD!

He’s spewing the same bullet points as all the other talking heads in the media, without taking a deeper look. 

We don’t have trouble getting financing for buyers who qualify: 

  1. Remember the house in Mission Hills with the 100-year old foundation with holes in it?  Bank of America financed it with a 20% down payment. 
  2. I sold a $900,000 house to foreign nationals (no green cards) who qualified for a regular mortgage at market rate with 20% down payment.
  3. How about the buyer with the 3-year old bankruptcy and short sale qualifying for FHA financing? 

The banks are happy to lend money to people who qualify under the same guidelines that have been around for decades.  When Blitzer says they haven’t gotten easier, I wish he would go into full detail of what he expects.  Does he want easy-qualifiers to come back?  100% financing?  Or does he just want to see his name in the paper every month.

The media is negative-based, and lives for bad news.  When there is some good news, it goes under-reported.  I don’t expect them to be cheerleaders, Yunnie will take care of that.  I’d like to see all the media report without bias – be neutral, so we can come to the right conclusions. If they could dig a little deeper it would be nice, but I won’t get my hopes up.

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