The sale of 2312 Gough closed escrow on 3/31/11 with a reported contract price of $2,210,000, as plugged-in people know, the property failed to generate an all cash bid of $2,100,000 on the courthouse steps in January.
With just “36” days on the market and 3 percent “over asking” according to industry stats, is the sale yet another sign of a “hot” San Francisco market, or with the added context of the Pacific Heights property having sold for $2,600,000 in 2004 and $3,000,000 in the year 2000, is it more a sign of something else?
As plugged-in people also know, down the street 2416 Gough sold for $2,075,000 last month, 31.4 percent ($950,000) below it purchase price of $3,025,000 in July 2008.
∙ Apples To Apples To Apples Again As 2312 Gough Returns [SocketSite]
∙ From 100% Financing To 100% Bank-Owned For 2312 Gough [SocketSite]
∙ Apples To Apples To Apples (And 100% Financing) For 2312 Gough [SocketSite]
∙ What Might Sir Isaac Newton Infer From These Apples? [SocketSite]
I predicted / guessed back on 2/14/2010 that this would sell for $2.1 – $2.2 and it closed for $2.21. Not too bad. Although to be honest, I think the market has improved since Feb 2010 so take that for whatever its worth. In terms of this sale being a “sign” of something else, I actually think it is a sign that homes priced at “market” rates will find a buyer and move quickly.
There is a misconception that buyers are perpetually on the sidelines either too afraid to buy; or strapped for financing. Sorry folks, but homes with a good price are selling fast and “over asking”. 1998 Vallejo #7 hit the market last week and went pending in 3 days! I bet it goes for over asking ($2.25M) as well. The specific history on this home (2312 Gough) is chronicled by me on another thread as well dating back to the 1999 pre-reno buy of $875k and its subsequent $3M and $2.6M flip and sale in 2000 and 2004 respectively. ~$550/psf is a pretty good deal for the buyers. Not such a great deal for the bank. Congrats!
Interesting outcome.
2 explanations:
1 – People are ready to take chances only when a good part of their bet is Other People’s Money
2 – The market has gained 5%+ since January
Option 3 is that this market is not perfectly rational. How else would you explain that some developers are still able to add 1 + 1 = 2.5 or 3 when they redo tear-downs in Noe? For some, a 100K or two (or more!) are just not worth the hassle…
I hear the occasional realtor talk about a “hot SF market”, but where is this, specifically? In the $3-$4 million range, I guess when one house sells with multiple offers, the realtors label the surrounding listings as hot. But from the houses I am tracking in District 7, none seem to be selling, although the sunday open houses are bustling. Am I wrong?
Yes. Especially in D7, where there are a lot of sales at decent prices.
Well, honestly the $3-5 million housing market in D7 is a little bit locked up. Everything 2.5 and under is selling fast, though. I think people are waiting a little bit to see what new inventory comes on the market in the last couple of weeks before May. There’s really no reason for things to be this slow. My 2 cents: The Vallejo, Steiner, Maple and Green St. houses are all pretty good buys provided there’s nothing physically wrong with the homes.
Yes, a little ‘locked up’ with buyer inaction is also what I’m sensing, once you cut through the BS frothing from the agent’s mouths. Lower priced stuff does seem to move.