February 29, 2012
An Apple For The Contractor That Has Everything
As we wrote last month:
First listed for sale in 2008 asking $738,000, the list price for 469 Valley was reduced four times over the following two years. The dilapidated home finally sold for $500,000 in 2010.
Today, the Noe Valley view property which is currently uninhabitable returned to the market as a "cozy cabin that needs everything" asking $579,500.
The sale of 469 Valley closed escrow on Monday with a reported contract price of $590,000, 18 percent over 2010 for the teardown. We'll let you know when the permits are filed.
Inside An Uninhabitable "Cozy Cabin" [SocketSite]
First Published: February 29, 2012 6:00 AM
Comments from "Plugged In" Readers
There is another way to go with this kind of place. Provided that it wasn't actually condemned by the city, you could clean it up a bit, make it safe and functional, and just live there. You'd have your own place, and could put money into it as it became available, gradually adjust the house to the changing circumstances of your life, the cost basis for property taxes would remain low, and a little leak here, a little sag there would not drop the property value.
All this for the price of a staged-flipped-reflipped basement TIC. At this price point, take the down payment you'd put into a 1.3M place (260K), and you'd only have a 330K mortgage to live with.
My sense with houses like this one is that the agents/sellers intentionally make the place look bad to scare off the kinds of buyers who, during escrow (or worse -- after) take them to court for hiding flaws.
Of course, the editor is probably right and this place will be razed and replaced with a 1%-worthy exemplar of modern design. Anybody agonizing over the lack of affordable housing for the middle class in SF might wonder whether the real issue may be that we have become conditioned to accept only homes that have gone through the reno wringer.
Having bought a few serious fixers during my life (with every problem imaginable), I realize that some homes are truly beyond human habitation, and having not seen this one in person, I can't say that it is not one of them. However, I do know that the vast majority of 'teardowns' can be made habitable -- even pleasant -- with a reasonable budget and tempered expectations for the level of finish.
Posted by: around1905 at February 29, 2012 7:32 AM
I cannot wrap my head around this purchase price.
Posted by: sparky-b at February 29, 2012 8:31 AM
"My sense with houses like this one is that the agents/sellers intentionally make the place look bad to scare off the kinds of buyers who, during escrow (or worse -- after) take them to court for hiding flaws"
There was no making this place look good in photos and quite a bit of money would be required to make it even habitable. Sorry but this is the sort of thing that one should know before making comments about.
Posted by: [anon.ed] at February 29, 2012 8:59 AM
I am not sure if a quick cosmetic fix would have changed the outcome. Still, slapping a bunch of white semi-gloss, some cheap flooring, hire a cleaner with 2 quarts of chlorine and make the kitchen a bit less gross doesn't cost much. Someone didn't care.
Posted by: lol at February 29, 2012 9:12 AM
You don't think it's better to display these sort of things as what they actually are? Cheap flooring, especially, would have masked some real issues on this one.
Posted by: [anon.ed] at February 29, 2012 9:15 AM
true. I understand the logic. If the place looks horrible from the outside, why bother with any improvement... If you're targeting professionals, full disclosure is your best bet I guess.
Posted by: lol at February 29, 2012 9:23 AM
"There is another way to go with this kind of place. Provided that it wasn't actually condemned by the city, you could clean it up a bit, make it safe and functional, and just live there."
I like your reasoning though this place seems to be so far gone that it would be hard to live there during the first phase of renovation. Probably the best strategy for a DIYer would be to bite the bullet and hire a contractor to do the basic gut rehab quickly. Get the place to a state where all of the roof, frame, and foundation issues are fixed. Plywood down on the floors and interior walls open to the studs. Then a DIYer could move in, take over and start installing the new systems, sheet rock the walls, and finally apply the finishes. It would cost more to hire a contractor to do the initial demo and structure rehab but the whole job would get done a lot quicker and in more comfort. Money well spent.
Posted by: The Milkshake of Despair at February 29, 2012 10:04 AM
Also, that isn't happening with a mortgage as no would have lended on this one in the current lending environment. No, this was marketed precisely the way it should have been.
Posted by: [anon.ed] at February 29, 2012 10:19 AM
err no bank^
Posted by: [anon.ed] at February 29, 2012 10:22 AM
Like I said on January 3 of this year: this one will go quickly.
Get real people: It's the lot value and a great location with south facing yard, quiet street, great Noe location.
I predict this will be a full or mostly full tear-down, full renovation, a floor added,garage added, 3-4 bedroom, 3+ bath and will eventually be on the market for $2-2.7m.
Let's see what happens. Love the location.
Noe Valley onward and upward.
Posted by: futurist at February 29, 2012 11:02 AM
Doubt it, but we'll see. IMO that's the stumbling block and the reason this one is such a hot potato.
Posted by: [anon.ed] at February 29, 2012 11:16 AM
This is definitely strong evidence for price increases in NV over the last year. I agree with futurist, this sale is for lot value and not much of the original structure will remain. At that price it's hard to imagine there's anything usable in that house.
If somebody bought for rehab they would likely have to replace all plumbing & electrical, and the roof. Replace much, if not all, of the foundation, and completely gut the interior. I doubt it would be safe to live in without doing
the above, and slapping on some paint and cheap flooring before the sale would likely have resulted in a later law suit.
I look forward to seeing the significantly enlarged house a year or 2 from now.
Posted by: lyqwyd at February 29, 2012 11:19 AM
Same here lyqwyd! Certainly it will take time and money to secure the permits and entitlements.
But it will happen.
Including the garage. That's a must have when it sells at the price point I'm predicting upon completion.
Posted by: futurist at February 29, 2012 11:23 AM
I predict it comes back on the market again either exactly as it is now, or with a set of "permitted" plan that does not include a garage.
Posted by: sparky-b at February 29, 2012 11:38 AM
MoD, that is how I dealt with my fixers too -- its surprisingly do-able, although there are a few hard months before you start getting to put it all back together. anon is right though about the banks -- they have to be convinced it is basically habitable. Easier to do these days with a 20% down payment and a
Posted by: around1905 at February 29, 2012 2:12 PM
Provided that it wasn't actually condemned by the city, you could clean it up a bit, make it safe and functional, and just live there
Posted by: EH at February 29, 2012 3:08 PM
as a long time bay area resident, I have to agree with around1905 --first post-- some of us would just like a SF place to live and not to have aspiration of mega profits, Arch Digest articles (and of course no negative equity)
Posted by: guest at February 29, 2012 3:28 PM
"Easier to do these days with a 20% down payment ..."
I'm not sure how you were planning to finish this thought but it doesn't seem to have been going anywhere tenable. Banks will simply not do a conventional loan on a fixer such as this one. Not with 20 percent down, 50 % down, whatever. They won't touch it.
Posted by: [anon.ed] at February 29, 2012 3:46 PM
I'm not disparaging the desire to own a simple home, just stating that this place isn't it. There's way too much work required to make it habitable.
Just the price alone is enough for me to be certain the property would take a large amount of money to make safely habitable. For example, you would probably have to spend $10-$20K juts upgrading the electrical. The photos also show that it's been terribly maintained, so you would probably spend tens of thousands on termite repairs, roof would be $10K min, etc.
Posted by: lyqwyd at February 29, 2012 4:24 PM
Brendan Collins, owner of Collins Construction, buys "fixer" houses, remodels and expands them, and then sells them. Noe Valley, where the older Victorians and Edwardians are modest in size because they were built for working-class families, is particularly fertile ground because it is such a desirable neighborhood for families, he said.Now, I obviously don't know if the particular contractor mentioned in this piece bought this place to flip it, but given this anecdote, and others I've read on socketsite, overheard at the coffee shop and heard from friends and acquaintances, I have to agree with futurist and lyqwyd. This is going to come back to market as a much larger home in less than two years.
Don't call it bringing flipping back, flipping never left. And the working class families just have to find some other neighborhood "to live".
Posted by: Brahma (incensed renter) at February 29, 2012 5:02 PM
Come on guys, with all the speculations....Im the seller and isn't it obvious, I bought this and tried to get proper permits for a garage and a modest sq footage of at least 4500...so I could do a good old NV Flip but just couldnt get it past planning so I resold it and actually walked away with a few bundles!
Posted by: the seller at February 29, 2012 9:06 PM
@lyqwyd No disparagement anywhere here or at you. I quess I am just a geezer who started in homes with old foundations, never enough outlets, plumbing that was symptomatic of age and other things. This home built in 1910 has had at at least one "renovation", sometimes in the 60s 70s an owner invested in a new kitchen and knotty pine siding at least. Some of us could live and thrive after some cheap paint and flooring. Just saying
Posted by: guest at March 1, 2012 7:08 AM
^no, you couldn't. You haven't visited the property in person and it's obvious. Sorry. Your overall idea can make a great deal of sense, and people do it fairly often in SF, but in this case the property needs serious reframing in order to even be safe moving forward.
Posted by: [anon.ed] at March 1, 2012 7:54 AM
"the seller" is probably The Tipster, but in this case I think he is spot on, other than maybe substituting DPW for planning.
Posted by: sparky-b at March 1, 2012 8:19 AM
thanks for the kind words anon.ed. You make this site a pleasure. good bye
Posted by: guest at March 1, 2012 8:50 AM
Actually this property needs much more than "reframing" to make it habitable,as anyone in the construction and/or design professions would know.
I look forward to seeing this develop into essentially a complete new residence in the next two years.
Posted by: futurist at March 1, 2012 10:05 AM
"Actually this property needs much more than "reframing" to make it habitable,as anyone in the construction and/or design professions would know"
of course it does, and of course you went there, parsing + condescending. your noe and laidley takes from the other thread remain nonsense, btw.
Posted by: [anon.ed] at March 1, 2012 10:20 AM
I'm glad you agree with me that the property needs more than "reframing".
Posted by: futurist at March 1, 2012 10:26 AM
Is Noearch really arguing about this point? Isn't it clear? I thought anon.ed was pretty clear, no?
Posted by: R at March 1, 2012 10:31 AM
anon.ed was totally clear. (it's often as if he's paying noearch so he can look like a warm, generous, and civil commenter by comparison.)
Posted by: shza at March 1, 2012 10:55 AM
Well, it didn't seem very clear to me. anon.ed puts down a lot of comments and people here, quite often, sadly.
Posted by: guest2 at March 1, 2012 10:59 AM
^No, I really don't and you're welcome to read both threads as well as stop jumping from name to name constantly.
Posted by: [anon.ed] at March 1, 2012 1:11 PM
@ guest and/or guest2,
If you're indeed the same person, and your 8:50 a.m. comment was sarcastic, then apologies if you took my curtness for rudeness. I disagreed, I actually even used the word "sorry," and paid you a compliment regarding your overall idea. So I'm scratching my head as to where you'd feel put down. But if you did, that certainly wasn't my intent. As I said, again, your overall take is a good one and a good, useful idea for lots of folks. I have a client who is doing something similar right now. But that m.o. is not for this house for many reasons. Cool?
Posted by: [anon.ed] at March 1, 2012 2:44 PM
"The Seller is probably The Tipster:.."
Sparky, we've been over this before. I am, in fact, ALL of the posters on this site. But that includes you, which is really me, so why did you (me) not know this?
Now that I think of it, I guess I can answer that question by myself to myself. So never mind.
Posted by: tipster at March 1, 2012 3:06 PM
Wait! I thought I was ALL of the posters on this site.
Posted by: futurist at March 1, 2012 3:15 PM
" Why these varous six to 10 interchangeable posters (and RforR is most likely three or four of them)"
Each of you are ALL the posters
and I'm 3or4/6or10 x 2 for each of you so......
the Fronzi hated the Fluj but then jumped the Snark-b
but that was past and now in the futurist ALL is one!
Makes Perfect Sense!
Posted by: ReadingForRealtors at March 1, 2012 3:32 PM
Well then RfR this will blow your mind:
None of these houses exist, it's all within a virtual Zynga game on Facebook.
Posted by: sparky-b at March 1, 2012 3:39 PM
You know what would really be cool?
We all meet some Friday after work at, say, Rockbar, or some other cool new bar in the Mish/Lower Noe.
We all wear little name tags of our posting name, and just have a drink, say hi, talk and have fun.
Could be coolish.:)
Posted by: futurist at March 1, 2012 3:43 PM
I'd be down for it. We could all wear a name tag that said "tipster."
Posted by: NoeValleyJim at March 1, 2012 10:07 PM
Posted by: anon at March 2, 2012 1:11 AM
Actually there would be one guy with 5 different name tags.
Posted by: eddy at March 2, 2012 8:41 AM
Yea, I know it's kinda crazy. I suppose we could all just show up without a name tag. Then just talk and guess who is who.:)
Posted by: futurist at March 2, 2012 9:36 AM
@tipster-eddy - "Actually there would be one guy with 5 different name tags."
Even on Zynga your imaginary friends don't get to wear name tags
(Unless you buy the Crazy Eddy Upgrade Pak and Boy do you have to farm a lot of Grass to get that one!)
Posted by: ReadingForRealtors at March 2, 2012 9:39 AM
You know, it's bad enough that I make up all of these characters on this site, and then have them argue with each other when I am writing all of the arguments myself.
But it would be seriously messed up to a)throw a party for all of my made up characters, b)invite only myself, and c) wear name tags.
So, no, I don't think this is such a good idea. But then again, we "all" knew that.
Posted by: tipster at March 2, 2012 10:03 AM
You would get so hammered. All of them would have a drink, some beer, some wine, a "Double Dare", etc.. All mixed together. But, funny for the bartender I would think.
"This one's on me, what you drinkin anon.ed?"
"I am drinking Smirnoff Ice, thanks tipster"
Posted by: sparky-b at March 2, 2012 10:44 AM
Trying to recall the other thread on this major POS. so was the main issue that building a garage is either not possible or prohibitively expensive? And trying to sell a mid to high end newly renov home w/o a garage in noe is almost impossible (while still profiting, that is, from the deal?) if thats the case, then this becomes the proverbial white elephant. It needs an eccentric buyer that wants to have their own design, but maybe only rides a motorcycle or scooter. Or perhaps is a huge bike fan.
Posted by: 48yo hipster at March 2, 2012 9:40 PM
There were other opinions regarding the garage issue: that it is either "impossible" or "expensive".
It's not impossible, being my opinion. It certainly won't be cheap but very doable. Other adjacent houses on the same side of Valley St. have garages. This will happen. This has potential to be another mid to high end reno with garage and it will eventually sell.
Location, location, location.
Posted by: futurist at March 3, 2012 10:56 AM
^ Neither adjacent property has a garage, actually. Nor do either of those two houses' neighbors, or their neighobors. So, OK. You've outed yourself. Despite what you've said, you've talked and talked and talked, and argued and argued and argued, but you haven't even really looked at or visited the property.
I'm wondering what's your intent here? The fact of the matter is that the property will need a DPW variance for a garage, because the front setback is too steep for the accepted formula. If you actually looked at this, I know you would know that to be fact.
If your point is, "throw a lot of money at it, plus variance, variance, variance," then hey, sure. It's hypothetically possible, but now you're on about "very doable," now? Get out of here. Few would want to be in a position where they are petitioning DPW for a garage spot with an incline that's against regulations, that isn't in keeping with the adjacent neighbors, or even their adjacent neighbors, in this transit + bike first, political environment.
There could be a really cool house here, tho. That's certain. With or without parking. I'm thinking, at best, a parking pad. But we'll see.
Posted by: [anon.ed] at March 3, 2012 12:59 PM