May 26, 2010
2830 Pacific: A Tripling Of Taxes (At Half Off Initial Hopes)
Speaking of big properties and taxes atop Pacific Heights, according to a plugged-in tipster the sale of 2830 Pacific quietly closed escrow yesterday with a reported contract price of $8,350,000. The sale should result in an annual property tax bill of around $100,000, triple what’s currently being paid.
As plugged-in people know, the 2009 Decorator Showcase home had originally been shopped around at $15,500,000 before being listed for $12,900,000. The list price was eventually reduced to $9,995,000 before the property was leased with an option to buy.
Also according to our tipster, "I heard it was a Hong Kong buyer." No confirmation on whether or not the buyer was the one with the option. And we would be remiss not to note a bit of irony considering the agent was Malin (who apparently represented both sides).
∙ Proposition 13 In Practice Along San Francisco’s Gold Coast [SocketSite]
∙ 2830 Pacific Scoop: Still Not Sold, But Leased With An Option To Buy [SocketSite]
∙ 2009 Decorator Showcase (2830 Pacific) Opens Its Doors And Kimono [SocketSite]
∙ An Actual Showcase Sale In The Works For 2830 Pacific? [SocketSite]
∙ Recap: What’s The Scoop On Foreign Investment In San Francisco? [SocketSite]
First Published: May 26, 2010 5:30 PM
Comments from "Plugged In" Readers
this is stunning given that a lesser property across the street at 2849 Pacific "supposedly" sold for $12 million last Dec 31.
is 2849 Pacific really appox 50% more valuable than this property?
Posted by: awakeandalert at May 26, 2010 6:44 PM
Pathetic that $8M only gets you this in SF.
Posted by: scurvy at May 26, 2010 6:47 PM
Well, this home still needs millions in upgrades... Depending on the foundation and whether or not it's a UMB, I would imagine that it's still going to cost you at LEAST 3 million to fix this thing and, if the owner isn't a developer and doesn't live in the area, it could easily cost more. The other property on the south side was at least in move-in condition. Yes, this would've sold for more three years ago, but it's still a pretty big sale... However, according to the Bay Citizen article, this house should have a taxable value of about $25,000,000 based on the author's $2500 per foot estimate of Broadway property values (insert eye-roll).
Posted by: Denis at May 26, 2010 6:58 PM
It's on a busy street!
Oh wait, I mean, the agent wasn't very good!
No, I've got it, the view isn't completely panoramic!
No, hang on, It's not in the best area!
Seriously, I'm speechless. Could the uber high end of the SF market have dropped by 50% in 6 months?
2849 across the street had no view and it's half the house. For $12Mil. Drag the photo around to the other, view, side of the street to see this house. It's at least 50% larger, panoramic view, and it's $11Mil finished.
I just can't see the St. Regis Penthouse selling for even half its original ask. That's a complete foreclosure-waiting-to-happen.
I'm just stunned!
Posted by: tipster at May 26, 2010 7:08 PM
Tipster I don't agree with that at all... Did you go in both houses? The house on the south side was larger and you could move into it. This house was in pretty bad shape - really. All the decorator showcase crap glued on to the rotting surface of the home doesn't make it livable. It also has a horrible floor plan (1500 or more of it's square footage was in the ballroom) no en-suite master bath and an unusable (and leaking) pent-room accessed only by a tiny, treacherous stair (modifying or expanding the pent-room would probably necessitate a variance - good luck with that).
That said, I didn't find the south side home all that impressive. It was large, and the bathrooms looking typically high-end, but the level of finishes didn't really wow me.
Anyway, as someone else pointed out on another thread, the top realtors (see above) are still moving high eight-figure homes, but are doing so off MLS. A response to the new price disclosure requirement?
Posted by: Denis at May 26, 2010 7:31 PM
man, who buys these properties?? I probably wont make 8mm in my lifetime earnings.
Posted by: jeffro at May 26, 2010 7:39 PM
Anyone wondering which is larger should punch each address into google. Select the first result. Then zoom in.
You can redo the layout. Can't redo the size or view.
I'll take the one for 8Mil any day in spite of the difference in condition: I agree that 2849 is move in and 2830 is gut rehab.
However, 2849 has a floor that is basically an attic, and the new owner of 2849 will probably never see that kind of price in real terms again in their lifetime.
It's as close to a collapse as I've ever seen!
Posted by: tipster at May 26, 2010 8:18 PM
This is such a minuscule niche. The margin of uncertainty is huge. It needs one buyer to sell, and it needs the seller to have the time or patience to wait for that certain buyer.
He could wait like the 65M-house guy. Wait, it's not sold yet... Never mind, he didn't want to look like yet another fool on the hill.
Posted by: lol at May 26, 2010 11:08 PM
Well, there's certainly been a collapse in expectations. Several D7 homes and condos profiled here flirted with 14+ million asking prices only to have prices reduced to 7-8 million. Some have sold, some are still seeking buyers. My feeling is that high-end buyers are reluctant to buy these major fixers and seem more willing to spend a bit more on finished homes. Note 308 Laurel flying into contract while the other two major fixers in Presidio Heights are lingering (much to my surprise). The current market correction, however, could easily put a freeze on the 5+ million market for the duration of the summer.
Posted by: Denis at May 26, 2010 11:28 PM
2505 Divisadero is a much better comp. Both houses require extensive money, time and energy to rise to the standards of 2849 Pacific.
Some major pros/cons of 2830 Pacific:
+ Fantastic block
+ Pano views from the pent-level
+ Substantial street presence
+ Large lot size
- Condition of the house after Showcase and a year of rental
- Deferred maintenance (structural, systems, etc.)
- Odd layout, lack of access to pent-level, etc.
A rough budget for "doing" this house to relatively nice Pacific Heights standards:
* Purchase price $8.35MM
* Two year reno carrying cost of capital ($8.35 * 5.5%) $0.92
* Two year reno property tax ($8.35 * 1.159%) $0.20
* Reno budget (Pac Hts mid-level quality) $4MM
Total = $13.5MM and two years of your life
The reno costs could easily range anywhere from $3MM to $5MM, so the total is likely to be somewhere between $12.5MM to $14.5MM.
After a reno, you can compare the house to 2849 Pacific. When doing so, remember that 2830 has a larger footprint, though fewer full-floors. Also, the only view from 2830 is on the pent-level (and it's grand), while 2849 has full southern views and sunlight from the entire rear of the house and garden.
To the buyer of 2830, congrats and enjoy.
Posted by: Joshua at May 27, 2010 9:31 AM
I'm all for progressive taxation, but $100K/year is absurd.
Posted by: BobN at May 27, 2010 10:15 AM
I agree with almost everything Joshua said, except for a few things:
2830 is a view compound. It is fully detached along all 4 sides and has significant grounds. The light and air, without being on a corner, are simply outstanding.
2849 is a large very vertical home with attic rooms - other adjoining homes are right up to the edge on either side, though it does have some space partway between it and one of the adjoining homes. In a vertical home with smaller floors, a lot of the space will be devoted to stairwells. Furthermore, attic rooms with slanted ceilings at this price range are fooling no one. It's a smaller home that got expanded into the attic.
After a reno, you can compare the house to 2849 Pacific. Once 2830 is finished, in no way is 2849 even remotely comparable.
Posted by: tipster at May 27, 2010 10:23 AM
"I'm all for progressive taxation, but $100K/year is absurd."
To be clear, the property tax is NOT progressive. The property tax is a flat tax. $100K/year is strictly based on the valuation of the property, and the same percentage would be paid for an $8M property as for an $800K property.
Posted by: Anon E. Mouse at May 27, 2010 10:23 AM
14mm cost, time spent, with a variance fight on a very monied block looming, versus finished for less money. An apple and an orange.
Posted by: anon at May 27, 2010 10:32 AM
Many windows were covered-over during the 2009 Showcase. A lot of "views" of this "fully detached" house feature walls and windows of the neighbors.
Despite featuring a 1500sqft "ballroom", the lower level of 2830 is a basement.
The satellite view makes neighboring 2870 Pacific look huge. It's not. You cannot overly rely on Google Maps to value a property.
Good luck trying to expand the pent level. (too bad, b/c it's got great views)
All that said, 2830 is a fantastic property, and when redone, could become truly remarkable. In the meantime, many will view it as a comp, so it's important that folks are correct on the facts.
Posted by: Joshua at May 27, 2010 10:55 AM
Tipster - I'll be less diplomatic. You are talking out of your ass here, have clearly never been inside *either* property, and you're making judgements based on google street view. LOL...
Like somebody said above, apple and orange comparison. You simply can't compare a done, done home with one that needs millions in renovation work. So stop...
You're good at larger, macro type assessments, but when it comes to individual property comparisons you consistently suck.
Posted by: Agent415 at May 27, 2010 11:00 AM
2830 + $3M and 2 years would certainly turn this into an insane home and would sell for a good price. I wouldn't worry about getting variences. The neighbors here all want these homes to reach maximum potential. And modifications to this home wouldn't really impact its neighbors in any way. Including a massive expansion of the pent room.
I'd relocate the front entrance to the center of the house and redo all the floor plans into a more classic / modern style. This house has a lot of potential.
Posted by: eddy at May 27, 2010 11:31 AM
Posted by: anon at May 27, 2010 12:49 PM
funny that google streetview seems to have missed about half a block of Broadway right at this location
Posted by: bernalkid at May 27, 2010 1:46 PM
To be clear, the property tax is NOT progressive.
Pardon my lack of clarity. I didn't say that property taxes were themselves progressive. I said that even though I favor progressive taxes (on income, etc.) and a greater burden being placed on the rich, the result of how the property tax is implemented is absurd.
Posted by: BobN at May 27, 2010 2:25 PM
Agent415, actually, I think you are giving Tipster too much credit. In prime areas (NW) he isn't good either. No house, regardless of someone's future intentions, is good enough. Everyone has an opinion though.
Posted by: PPC at May 27, 2010 3:56 PM
Agent415, actually, I think you are giving Tipster too much credit. In prime areas (NW) he isn't good either. No house, regardless of someone's future intentions, is good enough. Everyone has an opinion though
That's because Tipster plays a well rehearsed character on a website. Other people put real time and effort into gauging the market, and share their honest opinions. It's homemade apple pie and orange drink.
Posted by: anon at May 27, 2010 4:08 PM