Purchased for $1,400,000 on 6/21/2005, the kitchen of 326 Valley has since been remodeled (at an “estimated” cost of $50,000) and the property next door has gone from eyesore to contextual infill condos, so it’s not a perfectly clean apple.
That being said, the sale of 326 Valley closed escrow today (7/15/08) with a reported contract price of $1,569,000. Ignoring the impact of remodeling (in terms of both cost and increased value), this represents annual appreciation of 3.8% over the past three years for this single-family home in Noe Valley (2.7% if you subtract $50,000 for remodeling).
That’s also an overall increase of 12.1% (8.5% subtracting that same $50,000) which is in line with the neighborhood’s increase in average sales price per square foot for listed single-family homes since 2005 (11.3%), but significantly below the much ballyhooed increase in “median sales price” (23.5%). It’s funny how that happens.
And two snaps up in a circle for a plugged-in “resp” who two months ago calculated an estimated contract price $1,548,000 (a difference of only $21,000 or 1.4%).
∙ A Neighbor Notices Another Noe Valley Apple On The Tree: 326 Valley [SocketSite]
550 Valley is up for sale now. Or maybe has already sold, price is quite a bit higher 1.8M
Complete Studs in remodel though on 550
foolio,
i will even take you up on your lower price of $1.65MM…i will take the under for dinner or a nice bottle of wine
Posted by: sky at May 28, 2008 8:22 AM
Looks like ‘sky’ scored himself a bottle of wine. Let the debate begin as to whether sky meant a ‘nice’ bottle of Chateau Margaux or Chateau Souverain 🙂
BTW, 326 Valley (shown here) went quickly. Just one set of Sat-Sun-Tues open houses.
One offer (over asking) and one backup offer by the end of the first week.
Happy sellers, happy realtors, and presumably happy buyers too.
To defend Foolio he didn’t take the bet.
I also thought this would go at or below list and it clearly did not.
So much for my fortune telling skills.
Yeah, good thing I backed off that one…I really did think this would be over $1.65M.
Wonder what gives?
What give is that it’s a Marina style home. You never see them get top dollar in any neighborhood unless a full other level is added with all the bedrooms on the same level. I’ve seen it done either up or down, but up is best.
These are what is so interesting about Noe Valley. If you go in and removal all the cabinets and fixtures, host some WWE event and sell all the drywall and insulation on E-Bay you could sell the “contractors special” for $1.1M
“What give is that it’s a Marina style home.”
That’s a realtor red herring. This has always been a Marina style home. If the market is up 10% the price of this home would be up 10%, it just wouldn’t be as expensive as a non Marina style home.
@AppleJack:
Funny thing is, these sellers barely broke even! For a house in Noe freakin’ Valley? What in the world??
I believe the correct phrase is ‘two snaps *in* a circle’.
[Editor’s Note: And an ‘around the world and back snap’ to homey.]
“That’s a realtor red herring. This has always been a Marina style home. If the market is up 10% the price of this home would be up 10%, it just wouldn’t be as expensive as a non Marina style home.”
Huh? Isn’t it up from 1.4M to 1.56M? What is your meaning, kibbitzer?
Because it was always a Marina home that never got top dollar in any iteration along its history of sales. They built a master suite down, the property is like 2100 a foot, and it still didn’t even get 800 a foot.
Honestly,
You real estate salespeople crack me up. The price barely budges in 3 years, which used to get comments like “it’s on a busy street” to show that the market may have softened for properties with huge unfixable flaws, but not the “real SF” properties.
Now, the best you can do is “it isn’t absolutely perfect”. Mmmmmkkkaaayyy. Marina style home? I think the point was that it was a marina style home when it last sold, and if that was a flaw holding it back now, it was a flaw holding it back then. But honestly, it’s hardly the “it’s on a busy street” kind of flaw I’ve been used to seeing here.
What these comments seem to be telling me is that it is no longer the major flaws that hold a house back, but nearly ANY problem, however minor, will hold a place back. I know many buyers are not thrilled with taking a place without all the bedrooms on the same floor, but about a third of the 3/2s in the city don’t have that. This place is in a good neighborhood, has pretty views, nice back yard, good size, parking, there’s really very little here not to like. The remodel was better than what was there before.
And in the biggest runup in the history of the world, they walk away with, what? $20K for the trouble of going through a remodel, and only that because they had the luck of the property next door being cleaned up.
My hat is actually off to the real estate salesperson here. They understood the market, got just a little under it to generate the proper amount of buzz, and it looks like they did a great job.
And they made all the money, too. The owner could certainly have saved $500 per month by renting.
But, whatever,you guys. If this is the best you can do, the handwriting is on the wall.
The question is whether this is a good way to make money. All the cost and huge hassle of remodel, three years of mortgage payments, and now only a marginal return. Getting a job would be better.
Please don’t forget leverage when you’re doing your math. Few buyers buy homes with all cash. If they put $200K down and another $50K into the kitchen, then the real return is not 3% a year. It’s much, much higher.
I’m not saying that times aren’t tough and that it’s not fun to beat up on realtors, but how much better are these bear market arguments here where someone obviously did pretty well? “Getting a job would be better.” Since when did the owner become and unemployed house flipper? Yes, there’s risk in real estate and it’s not the right move for many people right now but give it a rest.
My comment, “Dave,” did not mention realtors. Nor did I mention the 3 percent return. I was talking about the dollar return, which was simply not worth the time and effort, as far as I am concerned. If this becomes a standard return, residential real estate will return quickly to transactions between users, and the flippers you mention will disappear. Which may be, in the long term, better for a stable market.
And in the biggest runup in the history of the world,
To be fair and to my knowledge (I may be wrong), 2003-2007 wasn’t the biggest runup in the history of San Francisco, although it was a hot market.
Tipster,
It is you and others of you ilk who crack me up. The house is up 160K in three years, and that is “barely.” I submit that Marina houses never do quite as well as an answer to Foolio’s query — because, um, they don’t. Not even in the best of markets. The typical Marina layout has three bedrooms in the rear, the back two need to be accessed by walking through the first!
The way to maximize Marina houses is to build up. Like 455 27th st did, purchased for 998 in 2005 and sold twice for high 2’s in the last few months. If you don’t build up on Marina style houses they are only going to be suited for families, period.
And stop acting like we’re pimping this site to try to influence anybody, let alone the market. I cannot believe you said this,
“My hat is actually off to the real estate salesperson here. They understood the market, got just a little under it to generate the proper amount of buzz, and it looks like they did a great job”
What a joke! You and your ilk represent ZERO capital potential for realtors. I post here because 1. I like talking real estate and 2. I get fired up when I see people posting utter nonsense.
“The biggest runup in the history of the world” — flame.
I personally said only one thing along those lines, and that was to talk about something specific — the runup we saw in Bayview. It was huge from 2002/2003 to 2006.
I bet you didn’t even know about Marina layouts tho. Sigh.
THat is, they aren’t going to be suited for families and only couples by and large. (Wish there was an edit feature on here.)
The only one who made any real money here was the realtor. The $160k “gain” includes approx. $90k in commissions.
78450 was the commission
And it was the previous seller who remodelled, not this one.
[Editor’s Note: Not entirely. The permit for the $50,000 kitchen remodel was pulled on 2/28/2006 and completed on 5/26/06.]
Fluj – I have to agree that some Marina’s have poor floorplans, with bedrooms in odd places. I own a Marina, and while the erratic layout is fine for myself and my partner (we use the spare bedrooms as a den and office), it is less than ideal for a larger family.
Floorplan – See
http://photos.imageevent.com/bats/valleystreet/House.jpg
OK, the master suite and much remodelling was done before this buyer. But you say …
“[Editor’s Note: Not entirely. The permit for the $50,000 kitchen remodel was pulled on 2/28/2006 and completed on 5/26/06.]”
That is no 50K kitchen, not even by half.
@fluj:
How do you know this was a 5% commission deal? Isn’t 6% more typical?
Five is more typical and I know because 2.5% was the advertised commission for the selling agent.
I love it when someone refers to people like me as “ilk”.
I could be wrong, but the master looks like it is on the ground floor, so I don’t think anyone is walking through bedrooms to get to another.
You know what? I stand corrected. THere is no one quite like you Tipster. But please, pay attention first. Read what others have to say. Then insert your Tipsterspeak. Can you at least do that?
The house was remodelled prior to this sale. In fact, it was remodelled prior to the preceeding sale. The master suite was added prior to the 2001 sale. At every step of the way, and for each year, it sold for less than avg $psqft for SFRs in NOe Valley.
The reason is simple and widely known among people in real estate in San Francisco. Marinas have three bedrooms in the rear. Two of them lead, each with a door, to a third. That is how they are. That is dysfunctional.
So, creating three bedrooms with a good flow on the same floor becomes a problem. This problem is only completely solved by building up. They didn’t do that here. They built down. In doing so, they wound up with two bedrooms on one floor, and a master suite down. When that configuration occurs, and three bedrooms are not all on the same floor in an SFR, the top dollar amount will never be attained.
This is basic and widely known San Francisco developer/realtor/architect knowledge. Those of you challenging this on some, “Oh NOW Marina-style houses are exempt” B.S. are only showing your own ignorance.
Here endeth the lesson.
Talk about showing your own ignorance.
Say Marina style houses (MSH) trade at a 20% discount to non-Marina style houses (NMSH). In 2005 the price of an average NMSH is $1M so the price of an average MSH is $800K. In 2008 a NMSH is now worth $1.25M which means that a MSH trading at a 20% discount is worth $1M, but both houses appreciated at the same rate of 25%.
Obviously basic math isn’t widely known San Francisco developer/realtor/architect knowledge.
The great and powerful fluj has spoken…!
FYI: I have worked on Marina style homes with ALL 3 bedrooms on the main floor and all accessed from a hallway. It does happen.
As for bedrooms on different floors, some buyers may, in fact, prefer that: 2 bedrooms on the main floor with an adjacent full bath. The master suite with full bath on the lower level, opening onto the garden. That can work well for some people with kids..or perhaps two partner/roomates. Or you can build up and create that separate master suite. There’s always more than one solution when it comes to good design.
As a developer I am interested in this math you speak of Michael. Please teach on; simple is it, great. Also, what does the % sign mean?
Come on, there are many variable to the “basic math” and factors that either remove or compound problem exponentially.
Michael, I think the factors have a lot more to do with differential equasions than “simple math”, but I’m a dumb builder so what do I know.
I don’t consider you a typical realtor, fluj. You know your markets cold, you study them constantly, and you speak the truth as you see it. But I think you are missing everyone’s point.
The point is NOT that one style or another home is better or worse than any other style. No one has looked at the $psft and said prices are falling on that basis. We all understand that homes of one type will sell for less than homes of another type.
But instead, what the point of this topic is, is that the same house, with all of the same flaws sold twice in a three year period, providing an indication of the market. Not that everything moves in tandem, but it DOES provide an indication of the market.
The point is that homes with flaws, that had those same flaws when they were last sold, are sold again, you can discern certain things.
For example, when a home on a busy street sells twice, the second time for a lot less money, what that tells me is that there are more homes than people to buy them. The problem cases always take the biggest hit, because people will overlook those problems when there are not enough homes, but will not overlook those problems when there are too many homes. We started seeing that last year.
What does that mean for the really good homes? Not much. They probably won’t zoom up in value, because there is likely to still be a shortage of such homes, but the pricing pressure is starting to be relieved.
Now we *may* have started to move into phase two. Homes with flaws that are not the same caliber as being on a busy street, next to a firehouse, etc. are now not moving for quite the same gain. Was there a loss here? No. But Noe has been on fire in the last few years, so this is somewhat of a surprising (e.g. small) jump up in price.
Lots of 3/2 SFRs in the marina share this floor plan, and although it is preferable to have all the bedrooms on the same level, and some buyers won’t touch a plan like this, it’s not the same as being next to the housing projects on anyone’s list of flaws.
Will a home with same-level bedrooms be impacted by this sale? Well, it takes even more pressure off of them, as a lot of buyers, though not all, will switch to this plan if they can get it for a lot less money. So, no, the perfect houses are likely to still be in short supply, the supply of them is not as short as it once was.
So what this is telling me is that the number of buyers continues to shrink, because the buyers in a hot neighborhood feel they can be more picky and won’t all jump at a house that, though not perfect, doesn’t have any serious flaws.
That’s the point others have been trying to make. I realize now that your point about it being a marina style 3 bedroom meant you thought it was a 2 bedroom with a “sunroom”, and yes, that really isn’t the same market as a 3 bd, but that wasn’t the case here. This indicates that the air could be starting to come out of even the once hot Noe.
Whatever. I’m not arguing with the likes of Michael, Tipster, and Noearch. The initial response was why it only sold for 1.56 and not over 1.6M, and I told you why. At each point it sold for less than average, and I said that. Three years ago 1.4 — below average. 2001 995K — below average. Recently, below average.
Why? Expanded Marina. Master down, two smallish BRs in the back. It’s very simple.
I answered Foolio’s query and reacted to the “typical realtor red herring “nonsense. And that is what happened.
OK, that makes sense, fluj. I understand your point now. Makes perfect sense.
@ noearch,
“As for bedrooms on different floors, some buyers may, in fact, prefer that: 2 bedrooms on the main floor with an adjacent full bath. The master suite with full bath on the lower level, opening onto the garden. That can work well for some people with kids..or perhaps two partner/roomates. Or you can build up and create that separate master suite. There’s always more than one solution when it comes to good design.”
No one is arguing that, bro. Indeed Marina houses are typically very well built and in my opinion AWESOME for couples with one kid or dual income no kid types.
But it’s a less expensive house than one with 3 brs on the same floor and that’s what I was saying. Stop trying to flex your architect muscles in every thread. We didn’t even have an argument.
I answered a specific question. If anybody is the great and mighty OZ, it is you, loudly trumpeting your own as yet unseen abilities.
Fluj, now that you’ve outed yourself, you really should tone down the snarkiness. I presume you went public in a marketing effort, but people are going to prefer someone a little more professional. Take a clue from the other realtors who comment on this site under their real names. Just some friendly advice for someone whom I respect and hope does well.
Thanks anon but you can’t please everyone. If you want someone candid, then hey, that’s me. And let’s not go as far as to equate blogs with real talk. People don’t go around voicing their true opinions in life.
so if you own a marina style and dont want to build up, is there anything you can do to improve the floor plan and your house?
get a fake victorian facade? Seems like the victorians go for a 15% to 20% premium, despite odd floor plans?
any cost effective suggestions or rules of thumb?
@ Fluj:
you really need to lighten up, dude..ah, I mean Kenny.seriously. you do.
this is entertainment. this is rarely world class info. really.
you’re about as defensive as a rattlesnake defending it’s hole in the desert.
oh, one more thing: I really don’t consider myself the great and mighty Wizard. But I do sometimes perform some pretty amazing tricks with floor plans. 🙂
Longtime socketsite readers will find a degree of amusement in noearch telling someone else to lighten up. I sure did.