553 Elizabeth

Listed for $5.8 million in April, the sale of the rebuilt Noe Valley home at 553 Elizabeth Street has closed escrow with a reported contract price of $7 million, matching the record setting $7 million sale price of 625 Duncan which recently resold for $4.4 million having been “stripped out in some areas to allow for alterations.”

Purchased as a two-unit property in need of extensive work and with roughly 3,400 square feet of space for $1.575 million in late 2012, the property was redeveloped by SF Modern design & development with John Lum Architecture and now includes 4,456 square feet of finished space (not including the 750 square foot garage), which puts the sale of 553 Elizabeth at roughly $1,570 per square foot.

Keep in mind the now five-bedroom home technically remains a “two-unit” building, with a full kitchen, bedroom and bathroom below, but the second unit was designed to be “seamlessly integrated” with the whole.

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Comments from “Plugged-In” Readers

  1. Posted by Dixon Hill

    It might just be the angle of the photo, but that looks like another garage with very modest clear height.

  2. Posted by Gil

    Yep, definitely a bubble.

  3. Posted by Bob in Noe

    They certainly destroyed any evidence that this was once a Victorian (except for the facade).

  4. Posted by youknowwhatImean?

    We’ve all lost the plot … there is a limited chance that this house will appreciate much in excess of this so clearly this is not an investment. People get so caught up in the bidding war and “winning” the home that they forget all about value and creates more knee-jerk reactions. Until the party stops …

    • Posted by Joshua

      Most people paying these prices are not looking for capital appreciation, they’re looking for a home. With tight supply, especially for renovated places, expect prices to remain elevated (so long as the stock market doesn’t crash).

      • Posted by Absolut

        In a market downturn, the house probably will maintain value slightly better than whatever tech stock they sold to pay for it

      • Posted by anon

        Quite a generalization given that the only other Noe house to sell for this much bounced back in under a year for quite a healthy loss. Can’t have wanted a home that much…

        • Posted by Anon

          You say that, knowing the series of factors that effected the 625 Duncan sale which made it very far from apples to apples. Why?

      • Posted by frog

        A lot of people buying well over the million dollar mark are not paying for an investment. They are spending less than 25% of their assets on a place to live. Which is a perfectly sensible thing to do, even if the house’s price declines.

        • Posted by anon

          You really think that someone with $25M+ in the bank would pick this place to live in? Out of all the places in the world. Really?

          • Posted by bg

            Well Zuckerberg and Evan Williams have significantly more than that… and they chose this neighborhood to live in.

  5. Posted by Stop Driving

    Proof the market hasn’t run out of suckers just yet. This place will be a laughing stock in under 10 years. Way too ‘contemporary’ and a failed attempt at a good minimalist design. It’s the shag carpet of our time.

  6. Posted by Amewsed

    $7 million? Wow, you can get three very nice homes in Forest Hill for the same amount. The entire interior can be recreated anywhere in SF but if Noe Valley is your only desired location, more power to you.

    There are three homes in my neighborhood for sale. Only one of the three is desirable in terms of lot, interior design, and value. The one sold within a week after it being on the market and the other two less desirable are still on the market.

    • Posted by Anon94123

      7 million….You could get a home in Palm Springs (with pool and views), a cottage at the oceanfront Bay Villas at Kapalua (I was just there, I know), AND a nice mid-century modern view home in Sausalito COMBINED for less than 7 million.

      • Posted by Amewsed

        How much for a ocean view villa in Bali, Thailand, or Seychelles, a cottage in New Zealand, and a nice pied a terre in London (Kensington Area)?

        Mahalo and Aloha.

        • Posted by Dixon Hill

          My first thought when I saw this was the same home would cost less if it was located in one of London’s nicer neighborhoods.

      • Posted by Absolut

        i’m guessing the buyer could afford to buy those places too in addition to this home, if they so desired

  7. Posted by BobN

    Nice plywood…

  8. Posted by Mark

    i’m officially retiring this site from my bookmarks.

  9. Posted by John

    … for those of you who want to take your corporate boardroom home with you, I guess…

  10. Posted by eddy

    Deja Vu

  11. Posted by Frank C.

    Not even an unobstructed distance view from the rear windows, and wedged next to a much taller apartment building. Utterly bizarre price. So a real view in this neighborhood would now be 10m?

    • Posted by TheGrimREpa

      It’s not even a great block to be honest (I live pretty close). It’s changing, but there are several pretty rundown properties just a few houses away from this.

  12. Posted by JR "Bob" Dobbs

    My two take-aways:

    1) There has been no SF price slowdown yet;

    2) SF prices are so ridiculous that any buyer should be prepared for the risk of a significant loss in equity in the coming years.

    I’m not saying #2 will happen. Odds are above even imho that it won’t happen (and we may see big further rises from here). But there is certainly a not insignificant risk of it. I suspect (although I really have no idea) these buyers could probably shrug off a 25% loss if they had to sell within 10 years. But for those who could not absorb such a loss, I would not buy in SF right now.*

    * If OPM no-down loans come back, sure, go for it.

  13. Posted by Larry

    So you’re having a smart cocktail party and when you open the oven door to take out the hot hors d’oeuvres, you singe the hair off the guests sitting on the sofa. The “open floor plan” thing is getting tiresome.

    • Posted by Pioneer

      That’s the downstairs second unit with the oven behind the sofa. The people down there will be serving the hot hors d’oeuvres, and the sofa is for 10 minute breaks, no napping while on duty!

    • Posted by R

      That’s the nanny’s apartment.

  14. Posted by around1905

    Perhaps this is indicative of the growing split between more run-down houses and new or ultra-renovated houses even in the same neighborhoods. It used to be that you could buy a run-down place and hire an architect, get your plans in order, hire a builder, and renovate if you were prepared to wait a year or so. That kind of kept a lid on the price of these like-new places.

    Now, however, most good architects have a 3-6 month waiting period before they’ll start any work with you. Then the planning department takes at least a year to even open your file. Thats before even the building department has taken a look at it. Construction is still far down the line. So the process has stretched out to 3+ years.

    Time is money and for folks with enough money we are seeing how much time appears to cost….

    • Posted by soccermom

      Absolutely right, yet I would venture that a majority of buyers fail to appreciate how much time and baloney will have to go into a 2015 launched project… I was in a beautifully prepped house this weekend and heard a banker type gesture to the wreck next door and say, “We’re probably going to want something like this that we can ‘do.'” Good luck with that.

    • Posted by Orland

      Makes sense, and especially so when you consider there are likely a half dozen other serious parties clamoring for the same “beautiful home in fashionable Noe.”

    • Posted by Richard

      Hard to evaluate that idea without knowing more about all the costs. The gross return on this house was ~ $5m. Assume all the permits, materials, labor, etc.. that went into the remodel cost, what, $2m? If that?

      That means someone spent $3m to avoid 36 months of waiting, or ~ $80k/month. Even in this market, $80k still rents a lot of house per month. Especially in NV. Can’t imagine you could reduce that figure by more than $20k/month for avoided costs of renting, which means you’re short $60k/month or ~ $2m. That’s a quite an impatience premium.

      Either that, or the market’s bonkers. Whichever.

      • Posted by jack

        Good analysis. Although there’re other factors not yet priced in, such as uncertainty whether if your landlord will evict you, and having to explain to your peers that you’re renting (when in fact you have $ in the bank to buy this place 3 times over).

    • Posted by John McGlynn

      Three years????!!!!!!! Hahahahahaha! Try 4.5 years for approval to do my house. That’s 4.5 years BEFORE the construction began. It’s City Planning and the attitudes of the crowd that inhabit it (“We’re here to save San Francisco, and anyone who wants to construct anything is a capitalist mogul out to “ruin” the City”) that have caused this situation to begin with.

    • Posted by Richard Crooks

      Only in San Francisco the people with Money who buy this will never worry. There is only one San Francisco and a lot of this is because of the address. This kind of people buy and apartment on Park Ave in New York and this is cheap compared to 23 Million for an apartment.

  15. Posted by Matt in Uptown

    They butchered the original exterior. Why? Now it looks like a cheap tract house in the burbs try’n to look vintage. The inside in very functional… or is it institutional?

  16. Posted by no_ vally

    On the topic of record price in Noe…does anyone have details on the mega house going up at Hill/Sanchez? Not sure if it’s spec build or built-to-own, but good candidate for Noe’s first 8 figure sale if it does hit the market soon. Crazy views/size/renovation from what I’ve seen driving by…and not everyone can say their house is a block or so above Zuck’s new $10mm++ abode.

    • Posted by youknowwhatImean?

      Funnily, I know the family that owns this “megahouse” coming up on Hill and they’ve been renting for 3 years while waiting for it to be built (it was an empty lot for awhile and they had to wait for architect/permits much longer than desired). Don’t think they’ll put it on the market, as they’re dying to move in themselves!

      • Posted by Amewsed

        An empty lot took three years to wind itself into a finished product? Yikes! I am sure that they will not want to repeat those efforts again in their lifetime. The SF permitting department needs to reduce the time and expense involved to build regular homes for regular people.

        I have learned a long time ago it is much easier to earn enough money to buy a nice home than to build one (unless you are married to a developer.)

      • Posted by JR "Bob" Dobbs

        I know even worse horror stories from friends (e.g. 7-years from gut/remodel plans to completion based largely on neighbor complaints about the added garage). When we bought our place a few years ago, we looked at a lot of places that would have been a better deal as somewhat-fixers, but we rejected them all. Life is too short for all the SF planning/construction headaches and the unknowns. We ultimately pared the search down to homes that needed basically no work at all. Paid more, but time and peace of mind are extremely valuable. No regrets at all. Let the pros deal with it all.

      • Posted by Sanchez St

        It was never an empty lot. A cottage came down for it.

        The new one going up looks like an office building on the peninsula.

        • Posted by DanRH

          I’ll add: I remember looking to rent there back in 1999. The rent was high (for then) and the place: horrible. Cut up rooms, nothing had been kept up to date. The yard was nothing. It just struck me as a very very sad place. I think the owners didn’t work and just lived off the rental income that came in from the unit I was looking at. Fine if that’s your lifestyle, but I certainly wouldn’t glorify what was there (and I don’t think you were). So though I’ll never be able to buy what’s going in on that lot, I’m sure glad something new / exciting is coming in. Better than before…someone else is paying to do that…my taxes didn’t go up due to it (in fact, maybe just the opposite).

  17. Posted by Serge

    I think it’s hilarious that people decry facadism and then are okay with something like this. This is a Disney Land version of a Victorian. It might as well be on a studio back-lot somewhere in LA for when they want to film scenes in SF. This will be dated in less than 10 years. I’m sure there is some mid 50s crapbox near this that could have been easily made contemporary.

    Imagine if someone did the opposite. Take a Victorian interior and then make the exterior 100% contemporary with no shred of original appearance. That would be a terrible juxtaposition. Yet somehow the inverse is okay.

    At least the exterior is still there… in some form.

  18. Posted by redseca2

    I think from the developer’s standpoint the cost of an architecturally correct Victorian interior versus a white box “Dwell” interior is the driving point. Dwell merely enables them by pushing the stripped down look.

    I am assuming that for a variety of good reasons a Victorian project will actually need a “down to the studs” remake. Improvements like seismic stiffening, adding thermal insulation, modern mechanical, electrical and plumbing, and moisture control when factored with very poor condition lath and plaster walls call for everything to be stripped down.

    Then if you take a walk through the Beronio wood molding catalog, the Bradbury & Bradbury wallpaper and lincrusta catalogs, all the castings and other historic bits resources, you quickly realize that all of those traditional interior finish elements are desperately expensive, adding hundreds of dollars per square foot over the cost of the Dwell look. God help you if you want hardwood Victorian moldings.

    The Dwell look just requires nicely skim coated level 5 finish gypsum board wall painted white, a wood floor made from a species not native to the United States, one light fixture that costs more than your first car but does a terrible job providing light, and a day spent shopping on line at Design Within Reach. Add one ironic element (well used surf board, factory machine tool re-purposed as a coffee table) and you are done.

    • Posted by anon

      I get that for the lower end of the market. But a few hundred per sf on a place this size is still only around $1M. You would hope that a dream home for the ultra rich would give off a “that was tastefully done” vibe and not a “cost control” vibe.

  19. Posted by Anonandon

    “San Francisco Victoriana” claims it is going out of business because flippers are stripping Victorians and “Dwelling” the interiors.

    • Posted by JR "Bob" Dobbs

      Basically, people don’t want Victorian interiors (yeah, yeah, I’m sure someone will chime in that they love them for [fill in reason]). I don’t blame them. Our place was remodeled from the small, chopped up original Victorian into a far more bright and open interior. Far better now (the facade is still intact, and I think Victorian facades are quite pretty, so it all works out).

      • Posted by shza

        +1

      • Posted by Futurist

        Actually, I think there is a solid market for remodeled Victorians: my own house was fully remodeled along with a rear addition, including full seismic upgrade, all new mechanicals, zoned heating 3 new baths, quality wood windows, etc. However the interior plan was not gutted to open it up, but rather we retained a traditional dining room, living room, den/home office, new eat in kitchen. The interior trim is all original, original Douglas fir wood floors refinished, new interior doors replaced to match the existing 5 panel doors.

        The interiors are hardly ‘Victorian”, but rather, clean, uncluttered, painted one simple light gray with all white trim; modern baths and kitchen.

        There is definitely a market for this kind of Noe 1904 Victorian vs. the white dwellified version.

        • Posted by anon

          So, you think there’s a market –> because that’s what you did on your own house —> then, “there is definitely a market.” come on. You like them. That’s what you said. Fine and dandy.

  20. Posted by Mark F.

    Victorian Interiors were fine for Victorians.

  21. Posted by Just My Opinion

    These are very high class problems. Oh, I just can decide, should I spend a million restoring the victorian interior or 1.5 million gutting it and creating an open floor plan.

  22. Posted by Had to see

    I had to see this place and drove by yesterday. A squat brown building set back between two larger buildings on either side and in a non descriptive block. The perfect place for for someone with money who wanted to live in a nice house unnoticed.

  23. Posted by soccermom

    Subject to rent control (two units) and if never rented also subject to something like Eric Mar’s 24% transfer tax if a new version ever passed.

  24. Posted by DanRH

    Still in shock at that price, and I watch this area pretty closely. I can’t figure this with what happened over at 625 Duncan. This place has no view. Is proximate (walking) to a commercial area (24th) become more valuable than a view? (don’t think so but maybe it’s changing!).

    Anyway, I really like that street and like the location (and personally, I’m not a ‘view’ guy). Maybe they just really want to be close to the bus stop. 🙂

    Last note: there are 2 or so major gut jobs right in this ‘hood (1-2 blocks over). If those hit the market, expect more of the same. Both of those 2 are on what I would think are better blocks too.

  25. Posted by Abby

    Stunning (the price, not the place). It makes the building at 40 Lapidge St. behind my old apt that a facebook dude bought for $2.8mil in 2013 seem like an absolute STEAL.

  26. Posted by Pisces Lover

    $7million for a boring sterile corporate look? And the required gray exterior fad? How charming.

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