Wednesday, August 10, 2016

Class action lawsuit filed against Millennium Tower and Transbay

On behalf of all of the homeowners at the Millennium Tower, San Francisco’s own 'leaning tower', a class action lawsuit was filed today. The lawsuit is aimed at the Transbay Joint Powers Authority and Millennium Partners since both sides have denied any responsibility for the structure’s now-infamous tilting and sinking.

In part, the litigation reads:

The Millennium Towers in San Francisco is built on landfill. It is the heaviest concrete building built in this seismic zone and, unlike other neighboring buildings, it is not anchored into the bedrock below. It has been reported that the building was expected to settle evenly to the depth of approximately 6 inches over its lifetime, but has now settled 12 – 16 inches and is leaning 15 inches at its top to the northwest. We are informed that some owners are reporting problems with uneven floors, difficulty opening and closing doors, windows, and cabinets, and that some interior wall cracks have been observed. To date, none of the potentially responsible parties have accepted any responsibility for this problem nor have they offered any assurance that this condition will not continue to deteriorate.

I think Salesforce should join the suit as the building is going to fall on them. Today I passed by and looked at the sidewalk. It is really really bad - broken and patched repeatedly. They have even installed a broad expansion joint because they obviously cannot keep up with the rapid deformation. The lobby is obviously way below grade. The marble panels on the outside are completely unaligned. I suspect that the windows start popping out soon.

Tuesday, August 09, 2016

Millennium Tower - San Francisco Housing Bubble

Millennium Tower in San Francisco is sinking. The building has no visible damage, but cracks and some water intrusion have appeared in the underground garage. The fact that this building was not anchored in bed rock is impossible to believe. The phrase 'soil liquefaction' comes immediately to mind. Good luck to the unfortunate residents. The developers built an extra concrete heavy building on mud fill and only anchored a 645 ft tall building 80 ft down into mud fill. I am no structural expert but this sounds very scary and hopefully we would not see the literal San Francisco Housing Bubble crash when the building crash down and hit other San Francisco hi-rises near causing a giant domino effect in SOMA.

Millennium Tower - San Francisco

What I wonder about is just how this building would react in a six-seven magnitude earthquake, which is certainly possible. Would it stand or really tilt to the point of tipping over? And how did this design ever get approved? Seems like there are a lot more questions than answers - probably keep half the lawyers busy for the next several years.

Monday, July 18, 2016

SF Bay Area home prices finally drop

SF Bay Area home prices are starting to drop and they already dropping sharply. Very soon SF Bay Area will become a buyer’s market.

In San Francisco Bay Area, where the average home price is $1.5 million and the average income is $175,000 per year. Given a person’s typical HOA fees, homeowner's insurance costs, credit card and car debts, the average homebuyer can afford just a $778,000 home, nearly 50% below the average priced $1.5 million home. As result the home prices started to revert to their fundamental values and they started to do it really fast.

For example, 3 bedroom/2 bathroom home located on 1018 Hazel Ave in Campbell was offered almost two month ago for $1,049,999 and now almost two month later it still on the market, but the price was lowered several times already and the current asking price is $899,988. That's $150,000 or almost 15% down. Could you image it last year?

By the way this house was sold for $724,000 in 2007 on the peak of San Francisco Bay Area real estate bubble. Technically the home price surpassed 2007 peak levels, but the home is not sold yet.

Monday, July 11, 2016

San Jose Reserve Apartments Eviction

The Brotish Guardian picked up coverage of the dangerous situation the unfortunate residents of the San Jose Reserve Apartments. The 216-unit, rent-controlled building will be demolished next April to make way for 640 market-rate apartments.

Adding 640 units at market rate will add 400 units but it's adding 600 units so for market figures, yes there is a net gain in housing. In terms of community and social justice there is a net reduction of 216 affordable housing units because none of the new units will be available financially for current residents. It's good for the housing crisis in Bay Area, but it's very bad for the specific tenants who are losing their homes.

One more problem is that apartment project planned for a already crowded Winchester Boulevard. The new complex will have parking spaces for only 920 cars, but where the other residents would park their cars?

Wednesday, July 06, 2016

How I bought a condo in San Francisco for $268,000

TL;DR: I got lucky and won the lottery.

San Francisco is America’s poster child for unaffordable city living: The median value of homes rocketed from $670,000 in 2012 to $1.13 million this May.

But I bought a brand-new, one-bedroom condo in the heart of the Mid-Market District, right around the corner from Twitter’s headquarters, for just $268,000.

I’m living proof that it’s possible to buy a home in San Francisco even if you’re not a millionaire.

As a 23-year-old whose income is nowhere near the $147,996 studies say you need to afford a home in San Francisco, I assumed homeownership would be out of my reach for decades — if not forever.

But in early 2015, out of curiosity, I browsed real estate sites, setting the price filter below $300,000. To my bewilderment, a few listings popped up. The descriptions had one thing in common: they were all part of the city’s Inclusionary Housing Below Market Rate Ownership Program.

I quickly did some research. San Francisco requires developers of market-rate homes to fund construction of below-market-rate, or “BMR,” homes. The city then mediates their sale. At the end of 2015, San Francisco had about 3,500 BMR units.

To qualify, you must live or work here, and earn less than 120% of San Francisco’s median income. (In 2016, that means $90,500 for a single-person household, more than twice the national average.)

In theory, more than half of San Franciscans qualify. I was one of them.