Zillow Tells Tales Of Housing Woe … Meanwhile, Back At The Ranch, Multiple Offers Are Back In Vogue…An Object Lesson In “All Real Estate Is Local”

February 11, 2008

Embargoed for release until 9:00pm (hence the 9:01pm time stamp!) is the news that Zillow has just released their Q4 2007 analysis. It ain’t pretty.

Giant swathes of the country are bathed in the bright red color of price decreases and upside-down homeowners…here, for instance, is the national map of homes with negative equity. The bubblistas are gonna love this one!

national-negative-equity-map-v2.png

Here’s how to interpret that map: 50% or more of the homes bought in 2007 in, say, Modesto are now worth less than what the owner still owes on the property. Sounds pretty grim, and it certainly is if you’re one of those homeowners…especially since we Californians have taken it as our God-given right to have property appreciate steadily year on year.

Here’s a map I’d like to see: the percent of homes bought in 2005, 2004, 2003…pretty much any year going back which are now “under water.” Instead of bloody red color so much loved by the bubblistas, we’d see a map bathed from sea to shining sea — including even the fabled fruited plains themselves — would be painted a joyful bright green, the color signifying “0% to 10%.” In fact, the map would have to be modified to show the precise number 0%.

Moral of that story: I feel your pain, trust me. If you bought a home in 2007 in Modesto, and life circumstances force you to sell it in 2008…your life sucks. Absolutely. But what about those who can stick it out for 2, 3, perhaps 5 years that this market will remain sucky for much of the country? Life for them won’t suck. Absolutely.

Let’s examine San Mateo County. Zillow’s “Z-index” for the whole county shows a 5.5% drop — that’s right, a drop — quarter on quarter. Translation: If in 2007 Q3 you bought a hypothethical home that covered the entire county, that home’s value dropped by 5.5% by Q4 of 2007.

Sounds grim, right? Again, let’s look at the whole story…

Here’s a city-by-city heat map of price appreciation from Q4 2006 to Q4 2007 … and in this map, red is good (at least for homeowners; for perma-renters and bubblistas it gives heartburn.)

bay-area-z-index-changes-v2.png

Interpretation:

Huge swathes of San Jose, the East Bay and further inland, plus some pockets of the Peninsula — like East Palo Alto and South San Francisco and Redwood City — are down, in some cases dramatically. Most of the Peninsula, however, saw price increases from 2006 to 2007; in particular, the marquee towns of Palo Alto, Menlo Park, Atherton, Cupertino, Los Gatos, and Saratoga saw prices go up 10% or more.

Folks, it’s a mixed message out there: a lot of the country is in pain. But just remember this, as always: Real estate is local, local, local. Just because prices in Vegas haven’t fallen doesn’t mean you should sell your particular home and live in a tent. You need to look at the price trends in your neighborhood.

Oh, and the “multiple offers” mentioned in the title? Here’s a small sampling of what the rumor mill says has happened in the last week…

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Written by Kevin · Filed Under Consumer, Industry | 9 Comments 

A Hidden San Carlos Treasure: Arguello Park

July 10, 2007

Living here in the middle of Silicon Valley, with its fast pace of life, its love affair with technology, and its high cost of living, it’s easy to forget that there is a lot of nature around to be enjoyed. On Sunday I went for a walk with some friends in Arguello Park in San Carlos. I’ve driven past many times, but never stopped to just enjoy it. It’s surprisingly large, considering it’s completely surrounded by homes.
A discrete sign marks the way on Wellington, just off San Carlos Ave.

The sign for Arguello Park in San Carlos, CA

Arguello Park affords many views of San Carlos homes perched in their various canyons.

More canyon views in San Carlos, CA

Canyons in San Carlos, as seen from Arguello ParkCanyons in San Carlos, as seen from Arguello Park

Though it was a hazy day, the Stanford steeple was visible in the distance.

A faint view of the Stanford campus from San Carlos, CA

A baseball diamond in the park.

Baseball diamond in Arguello Park, San Carlos, CA

…and even an olive grove or two.
Olive grove in Arguello Park, San Carlos CA

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Written by Kevin · Filed Under Real estate, San Carlos | Leave a Comment