Purchased for $1,375,000 or roughly $1,610 per square foot in March of last year, the one-bedroom Lumina condo #D20H at 338 Main Street returned to the market listed for $1,499,000 two months ago, a sale at which would have represented apples-to-apples appreciation of 9.0 percent over the past year.

Reduced to $1,399,000 after two weeks on the market and then to $1,299,000 last month, the list price for the 854-square-foot unit “in the highly sought after…most premier residential building in SF” has just been reduced to $1,249,000, a sale at which would represent depreciation of 9.2 percent on an apples-to-apples basis.

At the same time, the list price for 338 Main Street #D35A, a 1,572-square-foot, two-bedroom Lumina condo which was purchased for $3,149,500 ($2,003 per square foot) last June, has just been reduced to $2,995,000 after two months on the market without a sale and having previously been listed for $3,199,000.

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Comments from “Plugged-In” Readers

  1. Posted by Jackson

    The front page photo of the Lumina condo article shows a much nicer layout than the actual listing.

    • Posted by SocketSite

      The front page photo is for the second listing that’s featured in the piece and is now listed for 4.9 percent under the price which was paid for the unit last June.

  2. Posted by cleverpunhere

    Is such a short-turnaround sale of a brand new unit really apples-to-apples? I don’t think so, because the original sale has the “brand new” premium whereas the second sale doesn’t. If the unit was sold in year five again in year six it might be a reasonable comparison.

    • Posted by Notcom

      Are you suggesting – well, I guess you’re not “suggesting” as much as just coming right out and saying it – that houses are like cars and see an instant depreciation as soon as they’re off the lot (or whatever the equivalent phrase should be)?

      I’m not saying that’s untrue, but cars and houses don’t behave that way for very long after selling: though I sometimes refer to realtors as “Used house salesmen(women)” I don’t think most people would, since I don’t think they see property that way.

      • Posted by cleverpunhere

        I’m suggesting that this phenomenon exists for at least some slices of the market, yes. Someone who buys a brand-new home is probably buying it in part because it is brand-new. If you sell it in 12 months, it is basically the same unit except not brand new, which matters. It especially matters if a building nearby has similar units that ARE brand new.

        I would not take the houses and cars comparison too far–there are too many differences.

        • Posted by tm

          I agree. there are plenty of shoppers, especial new money, and people who are OCD (a lot of engineers are a little OCD at least), wants specifically new construction only.

        • Posted by jwb

          Also because these new buildings are disposable, they show a LOT of wear and tear even when they are just a little old.

        • Posted by SocketSite

          Keep in mind that while there certainly are those who prefer brand new units, there were roughly four times as many used condos purchased last year versus contracts for new condos signed.

          And when the market is moving up, a “used” condo typically sells for more than when it was brand new, even one year later and assuming normal wear and tear.

      • Posted by Notcom

        Fair enough (and again, I’m not saying it isn’t true, just that I don’t remember ever seeing the claim being made); I guess the question at this point is whether/not a 9% markdown is what one would expect purely from the loss of that “new house smell” …as it were. Cars have that much – or more – I believe, so maybe it is.

        Another – much less positive – spin on this is what “jwb” is hinting at – or at least I’m interpreting as hinting at: that condos really ARE like cars and keep right on depreciating as they get older.

      • Posted by Just My Opinion

        How about, it wasn’t worth $1600 a foot then, and it is not now either.

  3. Posted by EBGuy

    Same owner? No sweat? Alas, the recorders website is a bit dicey.

  4. Posted by sfdragonboy

    My Mom said to never, ever buy a condo. Thanks Mom! Happy Mother’s Day in advance!!!

  5. Posted by Karl and Lenny

    why never buy a condo? I bought one in SF, owned it for seven year and made a 15% annualized return. It appreciated 8% annually. and brand new at the time of original purchase.

    If I listened to your mom I would have not only lost over $500k in cash gain but also would have been out an additional $200k in rent checks. Seems like poor advise but what do I know.

    • Posted by sfdragonboy

      You did great, but who is to say you wouldn’t have done better with a SFH ,right?

  6. Posted by anon

    Yeah, the “never buy a condo advice” is poor advice indeed. Another anecdote: we bought our SF condo in 2000 and sold in 2014 at just a shade under triple the purchase price, with just some minor, cosmetic upgrades. Worked out to being paid about $1600/month each month we lived there after all payments and expenses. Not bad. I do agree that in mid-2017, the market for condos in SF has softened while the market for houses is stronger.

    • Posted by Gary

      Man, you kicked my ass. I bought for 960K in 2001 and sold for 1.3M in early 2016. At least I can say I lived in SF for free for all that time. Good job!

      • Posted by anon

        Lower Haight gentrified a lot during the time we owned there. Dumb luck, but I’ll take it.

        • Posted by Gary

          My location was in the vicinity of City Beer on Folsom, for context.

          • Posted by Condoboy

            Bought for $1.1m in mid-2013, sold for $1.7m early 2017. Best investment I’ll ever make.

  7. Posted by another anon

    A condo, just like any other asset, can be a good investment or not, depending on the purchase price. At today’s price levels and with all the units in the pipeline I would be extremely selective in buying.

    After all, the City’s stated intent is to build enough housing supply so that prices fall, or at least, don’t rise as quickly.

  8. Posted by SF Guy

    If 35A was purchased last June, it can’t be marketed for sale for at least 1 year until June 2017. How come the owner or the selling agent are marketing this unit? Both the owner and the listing company should be penalized by the developer. Even if this unit sold, they can’t close escrow. The developer has the right to stop the sale.

    • Posted by Sarah

      The owner may be trying a ‘pay me now, close escrow later’ deal which may explain the drastic price cuts.

  9. Posted by Pablo Cela

    First resale at lumina’s first tower just closed at $2100+ per square foot which is a record closing at Lumina. 23C. Panoramic views. There is still less than 3.5 months supply of inventory with considerable demand for condos in South Beach/Yerba Buena. It’s not all doom and gloom out there, market is active/steady.

    • Posted by condoshopper

      interesting that a resale would set the record price (per square). if i were to pay more than anyone has ever paid why not go for one of the brand new units that are still available.

    • Posted by SocketSite

      Keep in mind that the 1,403-square-foot unit #23C at 338 Main Street, which just closed escrow for $2.945 million and officially “at asking” with a list price which was adjusted to match, was on the market for $3.2 million last year.

      Regardless, at $2,099 per square foot, it is 17.3 percent more than the price the seller paid the Lumina sales office for the two-bedroom unit with panoramic Bay Bridge views twelve months ago.

      • Posted by Pablo Cela

        Closed at $2,960,000 ($2108/foot) per listing broker Paul Hwang Skybox Realty.

        • Posted by SocketSite

          And per the MLS, and we’d be willing to bet future tax records, the buyer actually paid $2,945,000 and $2,099 per square foot.

  10. Posted by SocketSite

    We now have the apples-to-apples sale of 338 Main Street Street #D16G, another Lumina two-bedroom, to add to our cart.

    Purchased for $1.925 million ($1,374 per square foot) in March of 2016, the 1,401-square-foot unit has just resold for $1.7 million ($1,213 per foot), down 11.7 percent over the past year despite having “never [been] lived in!”

    But having been listed (by Skybox) for $1.675 million two months ago, the sale is officially “over asking!” as well.

    • Posted by Sabbie

      The developer still has over 100 units left to sell too.

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