Posted by David Krulac on April 30, 2007 at 20:16:06:
gee, I hope I’m not one of the naysayers. I did say go for it, the sellers might bit, and what do you have to lose?
Hypothetical- Price drop in the East bay? - Posted by michaela-CA
Posted by michaela-CA on April 29, 2007 at 20:12:04:
Just wondering. I suspect, that there might be a severe market shock in the East bay area due to the overpass collapse last night. People from the eastbay, who commute to San Francisco
and people form San Francisco, who are trying to head south from the bay bridge, will have to come up with some alternatives. They’re expecting the repairs to take months.
So, I would think a lot of people would hold off buying in the East Bay area and properties would sit. That might crate buying opportunities for investors with sellers, that don’t have the time to sit for months.
Just a thought. What do you think?
Michaela
Re: Hypothetical- Price drop in the East bay? - Posted by Sean
Posted by Sean on April 30, 2007 at 13:55:31:
SF is so overpopulated, people will take housing anywhere they can find it on a commuter line… S Bay is not on Bart once you pass SFO, so commuting from there stinks… its either CALTRAIN which is OK, but not as convient as BART or sit in traffic on the 101. And thanks to silicon valley housing prices there aren’t really a steal either.
So personally I would not look for a huge move,or price flux, from east bay to south bay over a road repair.
I Doubt It…well, maybe - Posted by Jimmy
Posted by Jimmy on April 30, 2007 at 11:11:56:
I seriously doubt this traffic snafu will have any impact on the general real estate market. unless you are talking about neighborhoods sitting right where the collapse occurred. there will be a huge disruption to these areas, with a major demo and then a major re-construction. noise, heavy equipment, dust. I wouldn’t want to live in that area for the next 6 months or so.
I lived in the Bay Area from 1985-2005 and saw two major disasters. the quake in 89 and the Hiller Highlands fire (torched hundreds of homes sitting above the west entrance to the Caldecutt Tunnel). In the impact zone, there were probably some bargains to be had. But I do not remember either of these disasters having a generalized impact on the real estate market.
Re: Hypothetical- Price drop in the East bay? - Posted by Rich-CA
Posted by Rich-CA on April 29, 2007 at 22:05:12:
People are pretty resilient around here. We lost all cross bay traffic after the '89 earthquake. CalTrans got the bridge back up in record time. Many companies allowed workers to commute to local facilities, parking was relaxed to allow more people to get to BART, additional feeders buses were set up to get more people on to the trains, ferry traffic increased. There was more of a departure from the Oakland fire than from the Bay Bridge collapse.
The real push to leave the East Bay has been two things: jobs and income levels. I recently talked to the Principal of one of my local elementary schools. West Contra Costa Unified will close 4 elementary schools this year as families with their first child continue to leave CA for places where they could hope to own their own homes without becoming indentured servants. We have a net outflow in the state of 250,000 people per year, with a heavy emphasis on the middle class. The net would be much higher except for the influx of low income people from across the border.
So, in the short run there might be a measurable dip, but it won’t be much and won’t last long. They predicted a year for the Bay Bridge but got the fix in place in a couple of months. I expect a 2 - 3 month period before some sort of fix is in place.
Too late! - Posted by dealmaker
Posted by dealmaker on April 29, 2007 at 21:16:25:
I’m not in the East Bay any more, but from what I hear from family and friends, and watching craigslist and realtor dot com; I think things have already slowed out there.
Some of it was just “natural”, ie; the end of a boom. Some of it was brought on by rising gas prices.
Just my opinion.
dealmaker
Re: Hypothetical- Price drop in the East bay? - Posted by michaela-CA
Posted by michaela-CA on April 29, 2007 at 22:09:37:
Rich,
thanks for your thoughts. It’s actually, the short term dip, that I’m talking about - for someone like me. I might be able to buy a fixer-upper as a great deal, because the sellers were in a time crunch and demand wasn’t there. And then have the market go back up in a few months and with it being all fixed up ready for sale. Maybe I’m jsut too new to the area and can’t evaluate things yet, but I still believe that this collapse is an opportunity to make profit.
Michaela
Re: Too late! - Posted by michaela-CA
Posted by michaela-CA on April 29, 2007 at 21:54:42:
According to this
http://www.dqnews.com/RRBay0407.shtm
the sales have slowed, but the prices have risen.
Are you aware of the I-80/(-580 overpass melting this morning? I think that might change some of the trend even if just temporarily: I think it’ll bring the east bay market to a halt, as the commute east bay/San francisco is going to be impossible for people, unless they’re close to Bart.
So, those people that are working in SFO and have been thinking of buying in the east bay, will probably hold off, maybe look in another area (where they’re not dependant on the bridge). Either buy or rent.
People, that are renting right now, might let their leases run out and move somewhere else.
So, with market being driven by supply and demand,
there might be much supply and little demand in the east bay. And there might be higher demand and smaller
supply in other areas.
It think this temporary situation will shift some of the buying and selling, which will then balance out again after the reparis, months down the road.
Maybe I’m wrong, but that’s what it would seem to me.
Michaela
Re: Hypothetical- Price drop in the East bay? - Posted by Rich-CA
Posted by Rich-CA on April 30, 2007 at 24:17:12:
I doubt that you’d be able to tell if it was this or negotiating skills that got the price you ended up with. The drop won’t be something you would notice in the normal course of doing what you do. The section only carried 75,000 cars a day. Its busy, but hardly a blip on the radar of the economics of the area.
Re: Too late! - Posted by David Krulac
Posted by David Krulac on April 30, 2007 at 06:44:03:
IMHO short term blips have little effect in the overall picture. For one reason the sellers lag the market, when the market is declining, it seems that sellers are the last to find out. They don’t want to believe that their property is worth less and they hold out hope that some white knight, like an “out of towner” will ride in and over pay for their property. I’ve seen sellers with ridulous high prices on their property sit and wait for that “buyer from CA” who will overpay. It almost never happens. With the internet and when a buyer comes to town, it takes them about 1 day if that to determine the market values, just by comparing prices of available property. There is a tendency of sellers to hold out for that top dollar rather than lower their price.
On the other hand you can always present that rationale to the seller, but I’d suspect that the seller that bites will have other issues that force them to sell now rather than later and at a lower price than they would like.
Re: Hypothetical- Price drop in the East bay? - Posted by michaela-CA
Posted by michaela-CA on April 30, 2007 at 09:04:38:
well, I went into SFO yesterday, not knowing anything about it, as I’ve gone back to tv-less. When I came back I went I-80 east, trying to go to 580 east. We were kind of herded into other traffic lanes and I wasn’t thinking. Just realized suddenly that I was going north on 580 and that there was a total backup going south. As I didn’t really know the area, I was already several miles north and the backup was still there, way north of berkely. This was a sunday and people knew about this. So, what is the effect it will have on a normal workday? Even if there are only 89,000 vehicles using it every day, it obviously cloggs up everything around there, as 580/980/80/880 are all together there. I’ve been going through that interchange every other day for some reason.
So, basically, you can’t go south when you come from the bayridge/SFO. And there’s major, major traffic backup going south on 580/80/880/980.
I guess I’ll see.
Michaela
Re: Too late! - Posted by michaela-CA
Posted by michaela-CA on April 30, 2007 at 11:44:09:
David,
yes, I’m new here and maybe i’m just not aware of the resiliance of the people in the area. But it kind of blows my mind hwo everybody is such a neysayer. When I see potential opportunity and everyone says: Oh, now, this is not possible.
Aren’t we as investors looking for motivated sellers? In the CA market everyone has been used to putting their house on the market and it selling immediately.
I do believe that is going to change on a temporary basis, due to the collapse of I-80. It’s going to create mile-long traffic jams for people coming from the north, as it’s a major intersection, that normally already has backlog. No matter what time I’ve driven through. And you can no longer go south when you come of the bay bridge.
I am sure, there will be a lot of potential buyers, who are looking in those affected areas, who will say: let’s wait it out and hold off with buying until we know thngs are fixed. Maybe I’m wrong, but I don’t think most people want to be in traffic for 2 hours each way. Yes, those people that are already in the area will cope with it. But what about those, that were thinking/planning on buying in those areas? What about motivated sellers, that can’t suddenly put their house on the market and sell it in a heartbeat? I’m not talking about your average seller, but the motivated seller, that we’re supposed to look for. Aren’t those going to become really motivated, if they’re under time constraints and can’t wait out the months it’ll take to repair? People, that are in foreclosure? People transferred? People already having bought another house, because they counted on immediately selling the one they’ve been living in? People getting divorced?
No, I don’t know the area, but I’m really surprised how everybody sees the glass as half-empty, instead of as half-full. Aren’t those of us who’ve been in the biz for a while surviving because we went against other people’s comments of ‘you can’t do that (here)’? Because we create opportunity were the average person is afraid to? So, why is everyone suddenly on the other side?
Just wondering?
Michaela
Re: Hypothetical- Price drop in the East bay? - Posted by Rich-CA
Posted by Rich-CA on April 30, 2007 at 12:54:40:
From 80 above the maze (Berkeley, Richmond, Vallejo), the only closed route is 880 as this is the road segment the upper deck fell on. 580 and the lanes to SF are clear.
From 24 (Walnut Creek), this does not go through the affected area so you will only see people bypassing the 80 to 880 junction as additional traffic but its clear to 80W (SF), 580 N&S, and 880 S. If you live, like I do, about equidistant between 80 and 24, we only have to deal with additional traffic, but everything is open. I have been told the BART trains all have seats, but then there is no effect on traffic coming from Central and East Contra Costa.
Likewise from the south side - Hayward/Fremont and so on there will be no effect going into the city.
The big problem will be getting out of SF. The Hayward/Fremont traffic, and there is a LOT of it, will have to get around on surface streets. This is nowhere near as bad as the 1989 earthquake which took out the Bay Bridge (and the main telecommunications cables to SF). At that time not only did the bridge lose a section but the old 880 connector (about 2 miles or so) collapsed completely. I read that eye witnesses saw the huge concrete columns holding the upper deck exploding like firecrackers.
Again, an inconvenience, but minor compared what we got through in the past. That’s why I don’t think there will be a noticeable effect on housing prices. Additionally, after 1989 a large number of businesses moved their employees out to the East Bay or Sacramento. We’re not as concentrated on getting to and from SF as we used to be. Before 1989 all of my contract work was in SF and afterwards, it was all in the East and North bay. Less expensive here, fewer regulations, and lower local taxes plus the disruption of having to funnel all the workers across the bridges made it sensible to move employees out of the city.