Another Big RewindPosted on Thursday, January 27th, 2011 at 5:29am.
Now comes another.
3011 Valley (4br/4ba, 3250 sq. ft.) is a big, charming home. We always loved the red door on this Cape Cod for some reason.
Inside, the home's interesting and different, but quite friendly and mostly up to date. The busy street outside recedes in importance, since most of the home faces treetops out back and is built along a modest downslope. You actually feel "above it all" rather than somehow hemmed in by Valley.
3011 was last purchased in April 2006 for $1.9m, a mint for something on Valley even then, and that was the first mistake.
The home soon became a rental, but the investor/owners started looking for a graceful way out in April 2008. We thought it was news back then, here at MBC, when the listing began below acquisition (see "A Loss at 2 Yrs?") at $1.849m.
Our words from almost 3 years ago now look mild and conservative, though that wasn't exactly MBC's reputation at the time:
[T]he start price reflects a realistic assessment of the state of things in MB today – flat to negative appreciation over 2 years for homes with issues...Wow, it was "realistic" then to consider "flat" appreciation on homes with issues.
No more. After a few failed attempts to sell over the years, 3011 N. Valley returned in July 2010 at $1.649m, and cut from there after a bit.
And the newly posted sale price is a wake-up call in itself: $1.425m.
That's a drop of -$475k/-25% from nearly 5 years ago, another home whose location issue seems to have dragged it far below the area's general peak-to-trough-to-now median price drop of 14%. (See "4th Qtr.: More Sales, Lower Prices" and "Other South Bay Medians.")
If you take a 2006 price and push it down 25%, where does that leave you? Hypothetically speaking, it looks like a 2003 price from here. The previous trade at 3011 N. Valley was in 1999 (at $870k when the home was new), so we don't have precise data on the market value in the interim.
Sad to say, our prediction in early December that "the losses will get worse when this one wraps up" was completely on point.
By the same token, we have to cheer the buyers who finally got the deal on 3011 Valley that many others must have eyed before.
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