4086 25th Street: Exterior
From a plugged-in “cornbread” with respect to 4086 25th Street two weeks ago: “It’s going to need a ‘very healthy level of demand’ now to hit $2.4m in this market.” Check.
From the MLS today: Reduced $396,000 (now asking $1,999,000).
4086 25th Street Is On The Market (And At Least We’re On The Ball) [SocketSite]

13 thoughts on “We’ll Wait For The Closing To See (And Know) For Sure, But…”
  1. Wow, a 16.5% reduction after 2 weeks. That’s gonna leave a mark.
    Maybe sellers are finally starting to panic…could we be entering Phase II of the bubble burst?

  2. Prop shark shows that these guys took out a $1.4M+ “construction” loan from National SH*tty back in June 2006.
    How does it work out here (sparky? paco?)? I know on the East Coast these type loans are typically short term balloons. Also, they require a COO within a certain time period. Get the COO, taxes are reassessed way UP (even here in CA I think with Prop 13 – right?). Don’t get the COO within the time period = default under the loan documentation.
    Any insight from the contractors out here?

  3. Nice spin, Dan.
    Frankly, it would take some serious cojones to bid on this one, even after this price slash. After all, if you wait two more weeks, it could be down another $200-$300k.

  4. It’s funny how every once in a while a home still sells “at asking or higher.” I can’t compete with stupid – so I wonder how much of this is simply purchases by the gullible. In addtion, how much of this “at-asking-or-higher” activity is really driven by selling brokers hoping to maintain their track records on sales prices (thereby causing homes to stay on the market for a very long period of time)? I don’t blame the brokers for wanting to keep up their strong track records – it certainly would be impressive to me if I were wanting to sell a home. But shouldn’t brokers get over it – and remind themselves that they make money when homes trade? Couldn’t brokers do more to minimize bid-ask spreads and keep the market moving? After all, the market will get its way sooner or later.

  5. “In addtion, how much of this “at-asking-or-higher” activity is really driven by selling brokers hoping to maintain their track records on sales prices”
    You mean listing brokers, right? But “very little” is the answer. People selling houses they consider to be trophy homes in high-quality neighborhoods want as much money as possible. In fact they usually want more money than is possible. That is the chief factor that drives pricing for properties such as this one. Brokers would indeed be content to price at market value and move on. Broker’s/agent’s pay hardly takes a hit. Two hundred K less? That’s only five grand.

  6. On the question of whether property taxes are ratcheted up when a house is remodeled, I believe the value of the improvements (as stated by the owner, always way underestimating) is added to the previous (prop. 13 protected) basis, so the new basis is still well under current market value. Once the house sells of course the basis goes to the selling price. My next door neighbor (who bought 10 years ago) did a major renovation and his taxes are still less than 1/3 mine (bought last year). Ain’t life grand?

  7. Satchel,
    I think that may be a purchase and construction loan. They buy out your first and it becomes incementally larger as you draw. They would have COO to get the final draw. Then the whole thing becomes a new first. Rates were very reasonable and no balloon

  8. Anyone have any idea how many square feet this place is? It looks to be about 2500 to me, which would make the first asking price a real laugher.

  9. “People selling houses they consider to be trophy homes in high-quality neighborhoods want as much money as possible. ”
    This is a “trophy” property?
    “Brokers would indeed be content to price at market value and move on.”
    That’s my point though. Agents want to list at a price they think the market will take – and will then advise sellers to hold on instead of taking a lower offer. It seems to me the seller should list at a reasonably aggressive price – and then accept a discount to that price if that is what the market dictates. Let the process of bid-ask to work.
    The rest of the country is not an “at-asking-or-higher market.” San Francisco stands alone – and it really doesn’t allow the market for homes to move as quickly as it might. The at-asking mentality is a remnant of better days: dot-com irrational exuberance and easy money.
    And then there is the most annoying of comments: “Your offer offended the seller.”

  10. This is a “trophy” property?
    Not in my opinion, no. In the eyes of the sellers tho? That was my point and I said that, using the word “consider.”
    That’s my point though. Agents want to list at a price they think the market will take – and will then advise sellers to hold on instead of taking a lower offer. It seems to me the seller should list at a reasonably aggressive price – and then accept a discount to that price if that is what the market dictates. Let the process of bid-ask to work.
    Now you are talking sales strategies, which vary. Do agents always advise clients to hold on? no way. Did this seller list at a very aggressive price to begin with? yeah, they did. Who’s driving the ship? In my experience, usually the seller, but we don’t know the backstory here.

  11. “And then there is the most annoying of comments: “Your offer offended the seller.”
    I can’t believe this is still happening either, but it is. Just counter back then. It’s business, right? You’d be surprised.

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