If you work/play around regular San Diego, it’s worth considering a smaller house/better location combination closer to town. If you don’t mind spending over $1 million, I think you are going to see some reasonably-good buys in Carmel Valley/Del Mar Heights/PB and hopefully even La Jolla in the coming months.
On the other hand, if you want/need a big house and want better value, Encinitas and Carlsbad offer both, around $200/sf or so.
Simple advice: buy the right-sized house that you can comfortably afford as far south as possible.
Former Citigroup chairman Sandy Weill listed his 6,744-square-foot apartment at 15 Central Park West for an astonishing $88 million in November, promising to donate the proceeds of the sale to charity.
Now comes news that Ekaterina Rybolovleva, the 22-year-old daughter of the Russian billionaire Dmitriy Rybolovlev, is buying the condominium. Rybolovleva is studying at an undisclosed U.S. university and plans to stay in the apartment when visiting New York. According to a source familiar with the sale, she paid the full asking price of $88 million, setting a record for highest individual transaction in New York City history.
Here is the official statement from her representatives:
A company associated with Ekaterina Rybolovleva, daughter of a well-known businessman Dmitriy Rybolovlev, has signed a contract to purchase an apartment at 15 Central Park West, New York. The apartment is a condominium currently owned by the Sanford Weill Family. Ms. Rybolovleva is currently studying at a US university. She plans to stay in the apartment when visiting New York. Ms. Rybolovleva was born in Russia, is a resident of Monaco and has resided in Monaco and Switzerland for the past 15 years.”
The apartment, in one of the toniest postwar buildings in Manhattan, has 10 rooms, including 4 bedrooms, a wraparound terrace of more than 2,000 sq. feet, 4 bedrooms and 2 wood-burning fireplaces.
“This sale is an outlier. It works out to be about $13,000 per square foot, the highest on record, for anything, that has ever occurred,” says Jonathan Miller, the chief executive of real-estate appraiser Miller Samuel. “What is ironic is that when Sandy Weill bought it for less than half this amount, he paid the highest price per square foot to date in that building, around, $6,400 per sq. foot. He is again setting a record.”
The previous New York City record had been set back before the market crash when investor Christopher Flowers paid $53 million for a townhouse at 4 East 75th Street. He resold the property on Aug. 15 for just over $36 million.
Will short-sellers and strategic defaulters race to the exits before the debt-relief tax exclusion expires on 1/1/13? They would be crazy to assume that the benefit will extend, though it may. Here is the last third of this articlefrom the New Yorker comparing AA’s bankruptcy to housing. More articles like this might encourage additional defaults!
When it comes to debt, then, the corporate attitude is do as I say, not as I do. And, while homeowners are cautioned to think of more than the bottom line, banks, naturally, have done business in coldly rational terms.
They could have helped keep people in their homes by writing down mortgages (the equivalent of the restructuring that American Airlines’ debt holders will now be confronting). And there are plenty of useful ideas out there for how banks could do this without taxpayer subsidies and without rewarding the irresponsible.
For instance, Eric Posner and Luigi Zingales, of the University of Chicago, suggest that, in exchange for writing down mortgages in hard-hit areas, lenders would take an ownership stake in a house, getting a percentage of the capital gain when it was eventually sold. Lenders, though, have avoided such schemes and haven’t done mortgage modifications on any meaningful scale. It’s their right to act in their own interest, but it makes it awfully hard to take seriously complaints about homeowners’ lack of social responsibility.
Of course, many borrowers made bad decisions and acted irresponsibly. But so did lenders—by handing out too much money and not requiring sensible down payments. So far, banks have been partially insulated from the consequences of those bad decisions, because Americans have been so obliging about paying off overinflated mortgages.
Strategic defaults would help distribute the pain more evenly and, if they became more common, would force lenders to be more responsible in the future. It’s also possible that a wave of strategic defaults—a De-Occupy Your House movement—would get banks to take mortgage modification more seriously, which would be all for the better.
The truth is that banks have been relying on homeowners to do the right thing. It might be time for homeowners to do the smart thing instead.
After four years of “bumming around and hopping freight trains,” the 25-year-old from Kansas City arrived at this hardscrabble section of the Imperial Valley desert and immediately embraced its sense of liberation from society’s rules and norms.
What others might view as desolation and deprivation, Puckett saw as a way to reduce life to its essence: water, food and shelter (plus Internet and cellular phone service).
“Slab City people have a great need to live with just the bare necessities and are happy about it,” she said. Puckett also met and married the man of her dreams: a T-shirt design artist who lives in an art colony-style portion of Slab City known as East Jesus. A videotape was made of the couple’s Halloween nuptials and shipped to Puckett’s family.
The couple have yet to devise a long-term plan. But for the time being Slab City suits them just fine.
Four men pleaded guilty in federal court in San Diego to stealing more than $11 million in a loan modification scam that preyed on desperate homeowners trying to save their homes from foreclosure.
Gary Michael Bobel, 59 of Carlsbad, Scott Thomas Spencer, 35, Mark Andrew Spencer, 32, and Travis Corey Iverson, 35, pleaded guilty to conspiracy charges. Bobel, also admitted that he failed to report approximately $489,308 in taxable income received in 2009 from 1st American Law Center. An employee of 1st American Law Center, Roger Trent Jones, pleaded guilty a year ago and was sentenced in March to 21 months in custody for his involvement in the conspiracy.
According to court documents, Bobel opened up the loan modification business in North County in 2008. The defendants used high-pressure sales tactics and outright lies to induce customers of 1st American to purchase loan modification services — for payments of $1,995 to $4,495 — such as falsely claiming to have a team of attorneys who pre-screened clients and having a 98 percent success rate in obtaining loan modifications.
Among other ruses, telemarketers pretended that their grandmothers got a loan modification through the company, that they had a special relationship with a particular client’s bank, or that the company had helped thousands of happy homeowners with loan modifications, prosecutors said. The telemarketers even persuaded homeowners to pay the company’s fees instead of using their limited funds to stay current on their mortgage payments, according to prosecutors.
Through the use of false representations and promises, 1st American Law Center fraudulently obtained more than $11 million in client payments between 2008 and 2010 from more than 4,000 homeowners across the country, prosecutors said.
From his classified ad two years ago – sound familiar? bobel ad
It is our mission and highest priority to provide Americans in every city with an ethical, affordable, and effective program in obtaining multiple solutions to financial freedom. Our vision is to create the largest and most reputable law firm in the country by providing education, customized client resolutions, and 100% customer service/satisfaction. It is evident, through the financial crisis that is taking place in all aspects of lending, that consumers need a personal advocate to help intervene. 1st American Law Center and Gary Bobel are committed to protecting all Americans from predatory lending and financial distress. It is our confident belief that success ultimately depends on establishing a customer service and relationship oriented environment, that instills the integrity in each team member in the crusade of “Protecting The American Dream.”
Gary Bobel
It must have been a slow week for real estate news – from thelatimes.com:
Could today’s seductive conditions in the housing market — severely marked-down prices, record low interest rates and hundreds of thousands of foreclosures waiting to be resold — be breeding new generations of the very practices that led to the crash?
In an ironic twist, there are signs that the wreckage left over from the housing bust may be reigniting dubious real estate schemes and fraud. According to researchers:
• Property flippers are back in action in places like south Florida and Las Vegas, where condominium prices crashed but are now appreciating again in some areas.
• So-called floppers are defrauding banks by hijacking short sales at prices below what legitimate buyers are willing to pay. In these schemes, realty agents obtain fraudulent appraisals to persuade banks to sell houses at below-market prices to investor groups. The investors then flip the houses at fair market prices to ordinary home buyers and split the quick profits.
• Creative “credit enhancement” companies are “renting” investors the bank account balances they need to demonstrate to lenders that they have the financial wherewithal to qualify for a mortgage. The accounts are real, but they don’t belong to the loan applicants who claim them. Account names are assigned to applicants — who pay for the service — but they are never allowed access to the money. When mortgage underwriters check to verify the deposits, which are in reality fraudulent sub-accounts, they are told the money is in the name of the loan applicant.
• Investors are hoodwinking lenders into giving them low down payments and rock-bottom interest rates by lying about their intentions to occupy the property they plan to buy as a principal residence. Some investors consider such dissembling nothing more than a fib, but in reality it’s bank fraud. Researchers at the Federal Reserve Bank of New York have documented that widespread falsehoods by investors about occupancy played a major but previously unrecognized role in the real estate bust.
Hat tip to daytrip for sending this along, frombetabeat.com:
A new wave of startups is working on algorithms gathering data for banks from the web of associations on the internet known as “the social graph,” in which people are “nodes” connected to each other by “edges.” Banks are already using social media to befriend their customers, and increasingly, their customers’ friends. The specifics are still shaking out, but the gist is that eventually, social media will account for at least the tippy-top of the mountain of data banks keep on their customers.
“There is this concept of ‘birds of a feather flock together,’” said Ken Lin, CEO of the San Francisco-based credit scoring startup Credit Karma. “If you are a profitable customer for a bank, it suggests that a lot of your friends are going to be the same credit profile. So they’ll look through the social network and see if they can identify your friends online and then maybe they send more marketing to them. That definitely exists today.”
And in the last year or so, financial institutions have started exploring ways to use data from Facebook, Twitter and other networks to round out an individual borrower’s risk profile—although most entrepreneurs working on the problem say the technology is three to five years away from mainstream adoption.
“Credit score is a lagging indicator,” said Brett King, a tall, puffy Australian with white blond hair who is the founder of the online-only bank Movenbank and author of BANK 2.0: How Customer Behavior and Technology Will Change the Future of Financial Services. “At best, your credit score is about 60 days behind. What we’re trying to do is look for things that reflect the likelihood of a future default, rather than what’s happened in the past.”
Movenbank is an online bank in private alpha release that replaces plastic credit and debit cards with a mobile device such as an iPad or smartphone. Mr. King is a major proponent of the questionable young science of using social media to evaluate creditworthiness.
When it comes to online privacy, Mr. King subscribes to the Mark Zuckerberg school of thought: standards are evolving, and the world will be better for it. (As long as you’re connecting and sharing, only good things can happen to you!) “Our view of what ‘private’ is, is changing,” Mr. King said. “We make friends with people we barely know!”
He predicts that banks will soon start asking customers to verify their social media profiles. Not everyone has a social media presence, of course, so submitting your Twitter handle will first be pitched as a way to provide customer support or account alerts, which will later open the door for “more complex products,” Mr. King said.
