Comments on: Mirabile Dictu, Price Drops in El Cerrito

By: Janis Mara

Janis Mara — Sat, 29 Mar 2008 23:09:51 +0000

Toady! Thanks for doing my homework, you RULE! I was going to check out Dataquick or some such source for El Cerrito’s median price, but you beat me to it. Meanwhile, I drove past 745 Balra and it sure looks nice; there was a view of the Golden Gate Bridge from the sidewalk to the south, though I didn’t go inside the house. Tree-lined street, nice nabe and walking distance to Fat Apple’s restaurant and BART.

By: Toady

Toady — Sat, 29 Mar 2008 16:51:33 +0000

Sorry, I should have looked at that a little more closely. Redfin has 55 current El Cerrito listings and median price is $586K.

By: Toady

Toady — Sat, 29 Mar 2008 16:47:38 +0000

You don’t really need to look at just one listing to understand that prices are dropping in El Cerrito. Median sale price for El Cerrito stalled out a couple of years ago: $647K for 2006 and $645K for 2007. And for the 77 properties currently listed on Redfin, median list is only $529K.

I think Ninth and Virginia was just good timing and a smart agent. It was a decent size, in good shape, on a huge lot, in a reasonable neighborhood. The agent just priced it correctly and it sold.

It looks to me like there were a handful of Berkeley buyers waiting out the winter, and as soon as some nice looking, reasonably priced houses started coming on the market, those buyers jumped.

By: Heidi

Heidi — Sat, 29 Mar 2008 00:43:15 +0000

My point is that if you want to make a blanket statement on prices dropping in a city; know the fundamentals of the the properties. The property on Avila was on the market when prices were going up and it did not sell then.
On you question about teh real estate boom. What about the house on 9th and Virginia in Berkeley. priced at 549,000. The agent said 50 disclosure packets went out to buyers agents and they received 15 offers. The accepted one offer and put 2 in back up position. Remember this is at 9th street and Virgina. What are peoples thoughts ?

By: Janis Mara

Janis Mara — Sat, 29 Mar 2008 00:34:26 +0000

Red, good to see from you! Looks like we dropped our posts almost simultaneously. I really appreciate your historical perspective. Do you think houses will ever get back to the precipitous highs they reached while the boom was still on?

By: Janis Mara

Janis Mara — Sat, 29 Mar 2008 00:11:33 +0000

Actually, since I live in Richmond, I’m going to cruise by a couple of those properties and check them out, Heidi. Do you live in El Cerrito? If so, I imagine it’s pretty worrisome, wondering if or when prices are going to start slipping. I’m glad you posted, and if there’s something you’d like to see me write about, feel free to let me know!

David, I agree that marginal properties will drop first. I imagine we both agree that marginal neighborhoods will do the same? Something I’m interested in: do you think prices will return to their former heights anytime in the next 20 years?

I’m thinking this is a lot like the dotcom bust you referred to. Not just a normal real estate cycle where prices got high and now are cycling back down, but a period where prices defied reality and will never be that high again. What do you think?

By: Red

Red — Fri, 28 Mar 2008 23:53:39 +0000

The highly desirable places will just drop slower, and maybe not as far. Happened that way in 1990 to 96. Eventually the price slope is just too steep; if a place almost as nice but just a little further out is $100000 less, then guess what I’ll buy?
Many can’t justify paying $700 a sq ft when you can find $150 sq ft new homes within (painful) commute distances.

By: David

David — Fri, 28 Mar 2008 21:58:33 +0000

Strong fundamental reasons? You mean like the house not being worth the initial ask?

Heidi, I’m sure you lived through the boom, and if you didn’t, you can be sure that c*** like a 2/1 across from a trailer park sold, and probably sold for $500K. I saw pathetic 2 br houses selling for $700K in 2005. That’s an “up” market.

This is a “down” market. Therefore, marginal properties are getting axed first. But don’t worry, “nicer” properties will get cut too.

By: Heidi

Heidi — Fri, 28 Mar 2008 21:44:29 +0000

Price drop in El Cerrito: Please before you make blanket statements about real estate… Go and look at the properties. 5804 Avila: Very noisy and right across the street from a TRAILER PARK. Yes a real live trailer park. Yes location, location, location is the fundamental of real estate. Go back and look at each of these properties and you will find strong fundamental reasons for the price reductions not relating to a down market.