January 13, 2011
Obviously They Simply Overpaid In Pacific Heights...
Purchased for $3,025,000 in July 2008, as plugged-in people know the single-family Pacific Heights home at 2416 Gough returned to the market last July asking $2,995,000 and was then listed on the MLS in August at $2,775,000.
With two price cuts in between, today the list price for the 3,500 square foot home was reduced to $2,295,000, a sale at which would represent an apples-to-apples 24 percent ($730,000) drop in value for the "Exquisite Victorian Home on a wonderful tree lined street in Pacific Heights" over the past two years.
Of course one could argue that the buyers of this property simply "overpaid" in 2008, but then so did everyone who relied on the individual sale as a market comp – or in the aggregate as it factored in to average and median sales price reports – at the time.
∙ Listing: 2416 Gough (6/3.5) 3,500 sqft - $2,295,000 [2416goughstreet.com] [MLS]
∙ Apples To Apples On A Pacific Heights Tree Lined Street [SocketSite]
First Published: January 13, 2011 1:45 PM
Comments from "Plugged In" Readers
24%!! How can this be? The median for SFRs in D7 is down only 14% since the start of '08.
The median in D10 (the worst performing district) for SFRs is only down 19% since 2008. Shouldn't this have dropped between 14% and 19%?
I guess I'll have to throw my beloved medians in the trash. Darn those medians!
Posted by: tipster at January 13, 2011 2:19 PM
For those who like medians as a market indicator, note that the 2008 selling price of this place was just a bit under the median for D7 SFRs that year. The current list price is right about at the median D7 SFR selling price for 2000 (not taking into account inflation).
I don't think this means a whole lot. Others seem to think it does.
(click on "North" on the left)
Posted by: A.T. at January 13, 2011 2:20 PM
Trying to get out in front of the Franklin House before it sets a nice foreclosure sale price, dare I say, comp? Not sure if I'll be around, or if SS will be around, but I suspect that this house is getting close to its floor price and a savvy buyer picking this up below $2M would have a nice home in D7 that could be a good investment over the next 10 years. I just don't think that the seller can sell this for less than $2M.
Posted by: eddy at January 13, 2011 2:24 PM
Sub-par house in a sub-par location. A nice place in good location wouldn't change hands so frequently.
Buy high, sell low.
Posted by: your equity will be assimilated at January 13, 2011 2:36 PM
Not the best location, but I wouldn't call this a sub-par house. It's nicely done, very serene looking. My only complaint is the kitchen. To me, it doesn't look like a top of the line kitchen that I expect with a $2MM+ price tag.
Posted by: Lori at January 13, 2011 2:50 PM
still needs significant work (beyond cosmetic) and the price is still too high, plus its on gough(sub-par product,check,sub-par location for the price,check).
i would take 3025 scott over this every time.
my hat is off to the sellers in july '08. $3M
could have bought much nicer places than this.
Posted by: anonee at January 13, 2011 6:18 PM
"Obviously They Simply Overpaid"
No doubt about that as the other properties that sold for 3M+ on either Gough or Franklin dwarf this one.
Posted by: [anon.ed] at January 13, 2011 9:53 PM
there you have it, people. The flipper and the realtor are in complete agreement. Just don't hold your breaths for any shred of data to support their conclusions.
Posted by: your equity will be assimilated at January 14, 2011 10:21 AM
I commented because I was curious so I searched the history of 3M and higher SFR sales on Gough and Franklin. I could provide the very short list of much larger properties than this one if you like. What I said was accurate.
Posted by: [anon.ed] at January 14, 2011 10:27 AM
Oh come on, now. $864/sf for a very nice, big Pac Heights SFR was not "overpaying" in mid-2008 but right in line with the then-bubble market. SOMA crap condos were going for more than that.
Posted by: A.T. at January 14, 2011 10:38 AM
Come on yourself. You think Fell and Oak addresses fare as well as the rest of NOPA and the Haight?
Posted by: [anon.ed] at January 14, 2011 10:56 AM
It's more likely that they overepaid for converted attic space. I'm fine to let these properties served as comps. There are going to be casualties out there and this one along with other franklin / gough homes that are going to get killed.
The was a prime sfh on pacific south side that just sold for prime price, as well as a fixer further up the gold coast that sold for top dollar and over asking a few months ago as well.
It's a tricky market right now.
Posted by: eddy at January 14, 2011 11:47 AM
Nice to have that $3mm bubble-era reference point. Otherwise we'd be hearing there is NO WAY anyone would ever have paid $3mm for this place (and so prices have really not fall much, maybe 5-10%). Fluj et al now have to go to plan B and pretend that the '08 sale price was way out of line - when faced with objective facts that disprove one's thesis an old sophistry trick is to come up with an argument that can neither be proven nor disproven by the known facts.
Posted by: A.T. at January 14, 2011 12:00 PM
I'm not familiar with "rereport" so can't say how accurate their data is. But if this place did sell for below the median in 2008 then this provides an opportunity to use median prices correctly.
Specifically, over half of homes sold in this district in 08 sold for more then this house. So while it may seem intuitive that a $3M price was out of line. The data shows otherwise.
Posted by: tc_sf at January 14, 2011 12:15 PM
There's no plan A, B, or Q. There's talking about SF real estate is all. Lately the Socketsite meme which is "mock 'location, location, location'" has some legs. But so what? You guys who are having so much fun with that are but one pocket of non-actors on a website. The saying still remains a truism. This Gough property was a place that was priced really high at the time, out of keeping with what those thoroughfares had ever done. The sellers did well to get a buyer at the price. And I'm not sure if you take note but myself, anonee, unwarrantedinlaw and many of the other more bullish posters on here do remark surprise when we see high prices that we think aren't justified.
Posted by: [anon.ed] at January 14, 2011 12:39 PM
OK? If that Ford st place sells within a couple of years it stands a strong chance of getting crushed.
Posted by: [anon.ed] at January 14, 2011 12:50 PM
Fair enough, but there is a tendency to try to paint any place that fetched these absurd 2005-2008 prices as an anomaly (hence the ed.'s snark in the header) rather than illustrative of the rule, when the fact is that with rare exceptions everything that sold in SF during those years went for ridiculous, unsustainable prices. We're now in the middle of a steep SF-wide (and nationwide) correction. I agree that it is a reasonable debate over the precise depth and breadth of that correction but that it is deep and broad is not.
This place is interesting because not long ago at all the CW was that the crash would not reach places like Pac Heights. Many here, of course, disputed the CW.
Posted by: A.T. at January 14, 2011 1:06 PM
I'm not really going to get into this debate, but I'm wondering if buyers even a few years ago had the expectation that the boundaries of Pac Heights were continuing to expand... I don't know to what extent realtors played into that fantasy, but I I'm sure their contribution was considerable. As such, houses on Franklin, Gough, California, and Pine started selling for these outlandish prices... and these homes in particular are getting killed. Now it looks like Pac Heights has contracted to mostly those blocks west of Fillmore, with a few exceptions, of course (the area immediately north of Lafayette Park for example).
Posted by: Denis at January 14, 2011 2:00 PM
so these two properties on gough are representative of how pacific heights has done as a whole? that's what the editor and gallery are saying?
Posted by: anonee at January 14, 2011 2:08 PM
"so these two properties on gough are representative of how pacific heights has done as a whole?"
No, they seem to be holding up a little better! Here is another recent "apple":
I'm always open to contrary evidence, as long as it is evidence and not conjecture and spin.
Posted by: A.T. at January 14, 2011 2:20 PM
Yes. Everything is down 25% or more. Just ask Tipster.
Well, I mean, except for this one (what? down 7%? that can't be, I have it on good authority everything in Pac Heights is down 25% or more):
http://www.redfin.com/CA/San-Francisco/2430-Scott-St-94115/home/930543 (note: this was formerly featured on SS)
Posted by: R at January 14, 2011 3:08 PM
Excellent find, R!
So, the current Pac Heights bubble-buy performance leader is a $290,000 loss, plus another $195,000 in realtor fees, after a year-and-a-half effort to sell. Can anyone find something better than a half million thrown away on non-rent?
Posted by: A.T. at January 14, 2011 3:31 PM
It's worse for him than that. His example of someone getting a great sales price is a FSBO!
Ha ha, they didn't use a realtor and got a great price on a high priced home!! Good thinking, there, Ace! I guess we should keep that in mind...
Posted by: tipster at January 14, 2011 3:50 PM
But I thought everything was down 25% or more? Are you admitting that is not true? Or are you trying to switch gears and talk about actual money lost? Cause I thought the discussion was about percentages...
Posted by: R at January 14, 2011 3:55 PM
Yes, I've been saying that things are generally down in SF 20-35%, with some places a little better than that and some a little worse. You found one that is a little better in terms of percentage loss (as I conceded there were) but a whopper in terms of dollars lost, although it looks like he actually did better (less bad) than I had thought by declining realtor "help" and going it FSBO.
Posted by: A.T. at January 14, 2011 4:04 PM
What is your source for the factoid that median home prices in D7 are down 14% since the start of '08? The only good source I know of is Dataquick and I don't want to pay for their archived reports.
Redfin no longer goes back that far, though they used to. I am having a tough time finding good sources for both current and stats through 2000, what are other people using?
Posted by: NoeValleyJim at January 15, 2011 11:22 AM
New guess: 1.95
Posted by: tipster at January 27, 2011 8:47 AM
Down to $2,125,000. Down 30% at asking.
Posted by: A.T. at January 27, 2011 1:51 PM
I want to point out that my new guess preceded the reduced asking.
Posted by: tipster at January 27, 2011 2:09 PM
real sf. imagine spending $2,491 on property taxes for the privilege of watching $35,000+ of your downpayment evaporate. every month. for 30 months in a row. and it's not over yet.
Posted by: el bombero (channeling "paco/kid char/anonee") at January 28, 2011 12:00 PM
This is in contract... Over the past few days we've seen a lot of stale inventory go into contract in D7 as buyers respond to adjusted pricing. 2409 Octavia is also in contract. I think there's a bit of pent up demand for homes in this area under 3 million.
The good news is that these sales (if they close) will clear out some of the leftover fall inventory. The question remains though, how many D7 SFRs are waiting in the wings to hit the market this spring?
Posted by: Denis at February 2, 2011 6:01 PM
Posted by: SocketSite at March 8, 2011 11:18 AM