465 Hoffman
As reported yesterday, the sale of 465 Hoffman closed escrow with a reported contract price of $2,970,000 ($675 per square foot), 1 percent under its last list price of $3,000,000 but 23 percent under its original list price and expectations of $3,900,000 ($886 per square foot). As the property looked in 2007 when documents suggest a sale at $1,150,000:
465 Hoffman: Before
A great example of a micro change in mix, the sale should help goose the average (and perhaps even median) sale price in Noe while not necessarily speaking to “appreciation.”
465 Hoffman: Architects Unveiling This Evening (And On The Market) [SocketSite]
A Post-Preview List Price Of $3,900,000 For 465 Hoffman Avenue [SocketSite]

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Comments from “Plugged-In” Readers

  1. Posted by lol

    Any geniuses around to tell us if the seller made a profit there? Break even?

  2. Posted by tipster

    Pretty much both anonn and SFS were right. from the first thread.
    Anonn predicted 700 psft and SFS predicted 700 in May of 2009, but 650 if it sat for a long time. It sold for 675 psft.

  3. Posted by sparky-b

    I fancy myself a genius so I’ll take a stab;
    I think they about broke even. They bought it for $1.035M, in July 2006. Probably spent $20K at the purchase, then paid that mortgage for 18 months (I don’t think they rented it), So that cost about $40K. Then they spent $1.2M or so on construction, and carried a bigger loan for 2 years. That cost them $320K. They spent money on taxes and insurance, say $80K. Then they sold for $2.97M, which cost them $200K in closing costs, oh and they probably spent $30K in staging.
    Add it all up and then made $45,000. But since these are guesses across the board they probably broke even.
    [Editor’s Note: Title documents suggest an unlisted transfer of the property from the buyer in July 2006 at $1,035,000 to the developer of the property at $1,150,000 in March 2007.]

  4. Posted by sleepiguy

    I still wonder how they got this through planning.
    Also, that this was a tough sell just reaffirms my thinking that buyers in the 3+ price range don’t really want modern homes.
    I still really like it though.
    A little OT: Is the similar looking 147 Laidley used in a commercial.. for, uh… I’ll get back to you on that one..

  5. Posted by sparky-b

    ^^^
    I don’t think this speaks to modern or not. I think it speaks to $3M is the single lot cap for the hood.
    4356 25th street was modern and sold quick at $2.6M
    The wife swap dudes house was victorian and went for $3M.
    3961 25th was a mix of old and new and sold for $2.8M.
    Plus there is the “actually a 2 unit” thing. That tends to hurt properties in this price range.
    313 Duncan I think was hurt by this.

  6. Posted by sleepiguy

    ooooh.. It’s two units? Very interesting…
    When is the city going to get over this? I get it.. They want to preserve housing, but how many remodels do we have to see where the developer has to “disguise” a separate unit just to get a building permit. It’s beyond stupid. No one is going to rent the damn thing out. I suppose their rationale is that if there’s an apocalypse or housing prices fall even further – like another 80%- then maybe it makes sense (not really). But to eschew a sensible floor plan in order to stick an apartment in it to make the city happy is just beyond idiotic.
    [Editor's Note: yes, it's "two units" without so much as a door between the "lower" and "upper" units if we recall correctly.]

  7. Posted by sparky-b

    [Editor's Note: Yes, it's "two units" without so much as a door between the "lower" and "upper" units if we recall correctly.]
    There is a door between them, a second kitchen, separate entrance. All of the typically things that cost this place money over a SFH.
    [Adam's Note: Apparently I recalled incorrectly or the doors at the base of the stairs weren't in place when I walked through.]

  8. Posted by Carnac

    “I think they about broke even.”
    Nope, money was actually lost.

  9. Posted by sparky-b

    ^^^
    Then you do the math.

  10. Posted by NoeNeighbor

    The City’s insistence on second units is a bit unrealistic but fortunately with good design the second unit can easily be used for the nanny, a home office, man-cave, entertainment room or some combination thereof. Most people spending this much on a house this size want some of those things, so it all works out.

  11. Posted by 45yo hipster

    OMG is this thing really 4400 sq ft??
    At first I thought sparky’s construction costs seemed high, but nope, 4400 is helluva big, too big for Noe IMO. Save that for pac heights, etc. And yeah, 2 units is an albTros around your neck at this price point…unless you can make it work as a full time nanny’s unit, but do people who buy $3 mil homes usually have full time nanny’s? (my guess is no, but what do I know, we have no kids and our maid comes in bi weekly to clean.)

  12. Posted by Alexei

    I read an interesting article which stated that one reason the Victorians in San Francisco survived was that they could be partitioned fairly easily into multiple apartments. In fact, both my neighbors have some version of this in their SFH. This allows well-built buildings which are not what people need at the time to avoid demolition. It also allows owners who fall on hard times to avoid selling, or alternately to expand their families without moving house. Flexible layouts should be encouraged.

  13. Posted by fancy rental

    “do people who buy $3 mil homes usually have full time nanny’s?”
    yes, if they have young kids many do, or au pairs. but I think it’s probably more used as an in-law or guest suite. at 4400 sf they can afford the space for the second kitchen.

  14. Posted by Shza

    For people in this wealth class, it is a status marker to have both a nanny and a “stay-at-home” mom. I remember a great article probably 10 years ago in the NYTimes profiling Manhattanites who made $100k, $1M, and $10M/year. (Interesting side note: the people making $1M felt the poorest.) It was noted that at the private school where the $1M family sent their kids, the status order was marked by Poorest–>pick-up by nanny; middle–>pick-up by non-working mother; richest–>pick-up by non-working mother accompanied by nanny. (It was, of course, a given that no one paying for this private school would be using some child care-type after school arrangement.)

  15. Posted by anonn

    I think not, Shza. By and large people in that wealth class around here live remarkably like you or I. This article speaks to that a whole lot better, and it’s a much more current NYT piece, and more local:
    http://www.nytimes.com/2007/08/05/technology/05rich.html?_r=1
    A place such as this one, with an au pair suite, in the ~3M range, will almost always command less money. People in the market for something like this will pay more for a big garage than they will an au pair suite.

  16. Posted by Shza

    That is almost a total non sequitur, anonn. The people profiled in that article all also seem to be single-income households with nannies. True or false: people with enough wealth to afford $3M homes are typically not double-income households. It seemed like a fairly non-controversial point to make. I guess you’re just jumping on “status.”

  17. Posted by anonn

    You seemed to be saying that people who can afford ~3M houses want to have live in nannies. I don’t think so. They’ll have nannies. Not live in nannies. Most of these au pair suites are actually used for visitors or offices or clubhouse type things, from what I’ve seen. I tried to show you a NYT piece depicting local people living like regular folks despite an ability to pay for a ~3M house. Yet you called it a non-sequitir. OK.

  18. Posted by Shza

    You seemed to be saying that people who can afford ~3M houses want to have live in nannies.
    Never suggested that. I don’t think we really disagree about anything here. 45yo guessed that people with this wealth didn’t have nannies at all (presumably because he figured they’d have at least one non-working parent and that was sufficient). In my experience, people in this wealth class tend to have both at least one non-working parent plus a nanny.
    I don’t think most people prefer to have the nanny as a live-in — convenient for going out at night but not worth the extra invasiveness. The nannies generally prefer to have their own places as well. I wouldn’t want to live at work, personally.

  19. Posted by sparky-b

    ^^^
    Exactly, which is why the second unit detracts from the value versus having a 4th bedroom with it’s own bath but still part of the main house. Mostly that is for guests and family and they will hangout in the living room/ dining room until bedtime.

  20. Posted by The Milkshake of Despair

    “…convenient for going out at night but not worth the extra invasiveness”
    I hear ya and wouldn’t want my employees living in the same house 24hrs. Though I think this is one of the things that you learn to live with. It especially helps to select discreet employees.
    Most of us will never reach the level of wealth required to pay live-in “servants” in the USA. However even people of modest means can experience this lifestyle quirk overseas. A $100k salary is modest by SF standards, but very wealthy by developing world standards.
    Some friends who had previously rented in the Mission moved to Africa for a couple of years to work for a NGO. They hired a live-in cook/maid and gardener/driver plus two commuting guards. Their house was very nice but not palatial. Both the cook and gardener were extremely genteel people and comfortable to have around even though their presence was usually apparent.

  21. Posted by 45yo hipster

    Thanks shza, I think you nailed it.
    Milkshake- I visited Rwanda a few years ago and even middle class Africans have a live in cook. It was a trip! I was hanging out with this 28 yo African who worked for a laundry delivery service for a nice hotel there, and he had a cook too (damn good one too.). Basically, the poorer the country (but no so unstable as to be in a defacto civil war), the more helpers even middle class people have.
    Now back to $3 mil houses and the perils of having to ‘settle’ for a live in au pair!!

  22. Posted by 45yo hipster

    Thanks shza, I think you nailed it.
    Milkshake- I visited Rwanda a few years ago and even middle class Africans have a live in cook. It was a trip! I was hanging out with this 28 yo African who worked for a laundry delivery service for a nice hotel there, and he had a cook too (damn good one too.). Basically, the poorer the country (but no so unstable as to be in a defacto civil war), the more helpers even middle class people have.
    Now back to $3 mil houses and the perils of having to ‘settle’ for a live in au pair!!

  23. Posted by 45yo hipster

    Thanks shza, I think you nailed it.
    Milkshake- I visited Rwanda a few years ago and even middle class Africans have a live in cook. It was a trip! I was hanging out with this 28 yo African who worked for a laundry delivery service for a nice hotel there, and he had a cook too (damn good one too.). Basically, the poorer the country (but no so unstable as to be in a defacto civil war), the more helpers even middle class people have.
    Now back to $3 mil houses and the perils of having to ‘settle’ for a live in au pair!!

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