A buddy of mine has an ocean front condo at the Del Mar Beach Club. One of the ironic things about these places is that a lot of them are owned by out-of-towners who live in Arizona and such. The parking lot is completely empty in the winter, but packed in the summer. From what I’ve seen, the ocean front condos seem to be mostly owned by 1. Retirees 2. Out of town owners. 3. Friends of mine that have rich parents.
As you go away from the ocean front towards the street, they become more local.
I don’t know what this means for prices in the future though, but I don’t see evidence of a lot of the EZ credit fueled flipping going on on the bluff, those condos have always been very expensive, but the prices don’t seem to have gone up at the same rate as say a house in Mira Mesa.
That’s just my take on it.

A buddy of mine has an ocean front condo at the Del Mar Beach Club. One of the ironic things about these places is that a lot of them are owned by out-of-towners who live in Arizona and such. The parking lot is completely empty in the winter, but packed in the summer. From what I’ve seen, the ocean front condos seem to be mostly owned by 1. Retirees 2. Out of town owners. 3. Friends of mine that have rich parents.
As you go away from the ocean front towards the street, they become more local.
I don’t know what this means for prices in the future though, but I don’t see evidence of a lot of the EZ credit fueled flipping going on on the bluff, those condos have always been very expensive, but the prices don’t seem to have gone up at the same rate as say a house in Mira Mesa.
That’s just my take on it.

A buddy of mine has an ocean front condo at the Del Mar Beach Club. One of the ironic things about these places is that a lot of them are owned by out-of-towners who live in Arizona and such. The parking lot is completely empty in the winter, but packed in the summer. From what I’ve seen, the ocean front condos seem to be mostly owned by 1. Retirees 2. Out of town owners. 3. Friends of mine that have rich parents.
As you go away from the ocean front towards the street, they become more local.
I don’t know what this means for prices in the future though, but I don’t see evidence of a lot of the EZ credit fueled flipping going on on the bluff, those condos have always been very expensive, but the prices don’t seem to have gone up at the same rate as say a house in Mira Mesa.
That’s just my take on it.

This is a question asked strictly out of curiosity because I do not know the area at all, but when you look at the sales history on this house, and other properties around it, how did a $217,000 dollar condo become $1,000,000?

I notice if you go back to condos in the same complex that the 1999 prices were in the $400,000 range or so. This would make them pricey as you say but from everything I am reading, anything in the $900,000 range would be strictly bubble pricing. If prices go to 2000 value (which seems to make sense) shouldn’t these go the high $400,000s?

Like I said, this is strictly a lack of understanding of the San Diego market. Are there enough people out there who can fundamentally afford $900,000 for condos and is there a bank out there who would loan that in today’s market?

This is a question asked strictly out of curiosity because I do not know the area at all, but when you look at the sales history on this house, and other properties around it, how did a $217,000 dollar condo become $1,000,000?

I notice if you go back to condos in the same complex that the 1999 prices were in the $400,000 range or so. This would make them pricey as you say but from everything I am reading, anything in the $900,000 range would be strictly bubble pricing. If prices go to 2000 value (which seems to make sense) shouldn’t these go the high $400,000s?

Like I said, this is strictly a lack of understanding of the San Diego market. Are there enough people out there who can fundamentally afford $900,000 for condos and is there a bank out there who would loan that in today’s market?

…how did a $217,000 dollar condo become $1,000,000?

Two reasons:

1) Securitization of loans allowed lenders to pass off mortgage risk to 3rd parties rather than holding it themselves. They only have to hold the loans long enough to fob them off on the next sucker, so why bother making sure that the borrower is good for the money? And of course they pushed the ARM products so that initial payments were low. This allowed a much larger pool of buyers to enter the market than would normally be possible. Supply held constant, this pushed prices way up.

2) Inflation. How did a gallon of milk become $5? How did your dollar go from being worth 1.25 euros 8 years ago to being only worth .7 today?

…how did a $217,000 dollar condo become $1,000,000?

Two reasons:

1) Securitization of loans allowed lenders to pass off mortgage risk to 3rd parties rather than holding it themselves. They only have to hold the loans long enough to fob them off on the next sucker, so why bother making sure that the borrower is good for the money? And of course they pushed the ARM products so that initial payments were low. This allowed a much larger pool of buyers to enter the market than would normally be possible. Supply held constant, this pushed prices way up.

2) Inflation. How did a gallon of milk become $5? How did your dollar go from being worth 1.25 euros 8 years ago to being only worth .7 today?