August 6, 2009
1240 5th Avenue: Raffle Winner Chooses Reality Over The Dream
The Yerba Buena Center for the Arts (YBCA) "San Francisco Dream House" raffle is over and the grand prize winner (a real estate agent from San Carlos) has chosen the cash ($1.8M) over the castle (1240 5th Avenue).
From YBCA spokesperson Kimberly Harding by way of SF Appeal:
"Since the house will not be given away as part of the raffle, then it will remain with the owner and they can do with it as they wish…We partnered with an individual to raffle off the house - we had the rights to raffle it off but the ownership wasn't transferred to us."
We'll call it an artful (and shrewd) structuring by the YBCA. Once again, the "dream" duplex was last listed for $2,280,000 in November of 2008 and will likely soon return.
∙ Can’t Sell? Raffle! 1240 5th Avenue: The "San Francisco Dream House" [SocketSite]
∙ YBCA Dream House Winner Takes Money, Runs [SF Appeal]
First Published: August 6, 2009 7:00 AM
Comments from "Plugged In" Readers
I'm gonna miss the fake pictures and that frantic timer from their site.
Posted by: lolcat_94123 at August 6, 2009 9:51 AM
What a fugly house. Who actually dreams of living in something like this?
Posted by: Zap Brannigan at August 6, 2009 10:07 AM
@Zap: someone who can't afford any house at all might dream of living in a house one day, even one that looks like this. Not everyone is as rich as you.
Posted by: DavidQ at August 6, 2009 10:33 AM
DavidQ, that's also why it was so obvious that no one was going to pick the house though. The people who could only dream of a house like this would have trouble with the annual property taxes.
Posted by: Shza at August 6, 2009 11:23 AM
So did the Raffle Winner get his money already, or are they d1cking around saying they want to sell it and then give the cash ?
Posted by: Chad at August 6, 2009 11:28 AM
Chad - YBCA never owned the house, so there is no contingency on the house sale to deliver the cash.
The winner should inspect the cash well to make sure that it isn't a photoshopped forgery :-)
Posted by: The Milkshake of Despair at August 6, 2009 11:36 AM
I entered the raffle, not because I wanted that fugly house, but because I want the dough. It was exponentially better odds than the lottery and if I didn't, at least the money went to a good local arts organization. Anyway, you could only afford to win the house if you were already a multi-millionaire who could pay the taxes on the non-liquid windfall represented by the house. It was basically kind of ruse -- there's literally no chance any winner would walk away with anything but the cash.
Posted by: WTF at August 6, 2009 11:39 AM
@ WTF you're right. I have entered three of these dream house raffles now and wouldn't think of taking the house. The first was in Santa Cruz, second in Marin and now this one. All for good causes and it is a clever hook and the odds seem good. Or did seem good. So far I have won nothing for my total $450 investment :(
Posted by: Oceangoer at August 6, 2009 12:12 PM
"the odds seem good"
European roulette is not a better investment than American roulette ;)
Posted by: dub dub at August 6, 2009 12:20 PM
Thanks "The Milkshake". And you are right, the winner should definitely inspect the cash. And if it were me, I would instantly buy gold bullions and "hide" it somewhere. LOL.
Posted by: Chad at August 6, 2009 12:54 PM
@WTF and Oceangoer
You are both sounding like sore losers. Move on now already :)
Posted by: Chad at August 6, 2009 12:55 PM
You got me wrong, Chad, I am not a sore loser at all ... I still get to dream and I will do it again.
Posted by: Oceangoer at August 6, 2009 12:59 PM
Actually, the odds and payoff (max 1 in 37,000 for $1.8 million for a $150 ticket) for the raffle seems to me much better than playing the lottery (for which I buy a $1 ticket maybe once every 5 years). Considering the California Mega Millions posted odds -- the odds of getting 5 out of 5 correct are 1 in 3.9 million, and payout is only $100K-$500K. Those odds are more than 100 times worse than the raffle, and while the ticket is 150 times cheaper, the prize is as little as 1/18th that of the raffle. I'm not exactly sure how to statiscially calculate the comparison, but it certainly seems like the odds-payoff-investment balance substantially favors the raffle.
Posted by: hmmm at August 6, 2009 1:18 PM
look up "expected value"
Posted by: J at August 6, 2009 2:10 PM
Yes - even if there were no taxes on the prize money, it would be irrational to pay more than $48.65 for a ticket ((1/37000) * 1.8M).
Posted by: Shza at August 6, 2009 2:23 PM
They pull this kind of thing in other high-priced housing markets, such as Santa Barbara, all the time. It lures in all of the people who are hopelessly, mathematically priced out of the market, (not saying that only those people buy tickets, though) and the eventual winner never winds up taking the house, because as previous posters have already said, they can't afford the property taxes on a million dollar home.
The "dream" is home ownership for those priced out of the market, not the features of this particular (and I agree, ugly) house. And for a lot of San Franciscans, it's an impossible dream.
Posted by: Brahma (incensed renter) at August 6, 2009 2:39 PM
The winner should keep his cash for 2 years, come back to the seller and snatch this property. Chances are he will have enough cash left to pay property taxes for a few years...
Posted by: San FronziScheme at August 6, 2009 2:48 PM
@Shza et al - Risk-based markets always include a premium for the variance. Yes the EV of a ticket is $48. If a lottery ticket ever cost even close to EV it would be a no-brainer for most people to play and there wouldn't be much incentive to sell tickets.
Posted by: Greg S at August 10, 2009 10:21 AM
Back on the market again (listed as 1244 5th Ave?), $2.1M.
Posted by: sidelined at September 9, 2009 11:49 AM
Posted by: Sunsetlover at March 8, 2010 3:18 PM
who bought it?
Two Princeton grads (wife is a doctor) in their mid thirties. Mortgage from Wells. It also looks like the bank of dad got involved this year (Deed of Trust in January), but that may have been just to tide them over 'til they sold their former residence (3/2 condo), which closed on Feb. 19 (bought May 2003, $638k and sold for $759k).
Posted by: EBGuy at March 8, 2010 5:53 PM