Results: First to $6m

Posted by Dave Fratello on Monday, August 11th, 2008 at 4:39am.

Last week MBC published a story on the growth in supply of high-priced homes in the Hill Section. Whereas, for much of 2007, total inventory in the Hills lingered near 15 SFRs from month to month, last week there were 15 homes priced at $3m or above, with total inventory at 25. (Two Hillies canceled after that, so we're at 14 and 24 now.)

Three of those 14 clustered near $7m, and it was our sense that maybe all 3 are still priced high by as much as $1m. So we put the question up to a vote: Which of the 3 would drop to (or sell for) $6m first? (See "Who'll Be First to $6m?")

The poll did not draw the most excited responses. And you know why. The fate of $7m listings is no one's priority, other than the sellers'. Alas, we live, blog and learn.

Still, the poll results were clear: 114 N. Poinsettia (pictured) was viewed as most likely to drop first. With 4 options to choose from (the 3 listings plus "none"), more than half (52%) of those voting chose Poinsettia. That's a clear mandate.

700 8th finished second with 17% of the vote, "none" took 15% and 923 1st seemed least likely to sell or drop below $6m, garnering 13% of the vote.

Why did Poinsettia "win" this vote? Location, for sure.

If you know the Hill Section, the notion of combining 2nd with Poinsettia might send shivers down your spine. Big strike for this home.

To compound matters, to maximize views, the house is actually built in an L-shape that is oriented toward the 4-way stop at the corner of these two busy streets. The front-yard pool (really?!?) is exposed to the intersection.

The home is inspired, stylewise, but it has farther to fall from $6.995m.

It's worth noting here that the most on-point comp for this listing is 116 N. Dianthus. That's a brand-new home also on a corner with 2nd St. – albeit much further up the hill. It was purchased during construction last October for $7.2m (sale closed in late April this year).

116 Dianthus has some things 114 Poinsettia doesn't:
  • a bit more square footage (6600+ against 6400 at Poinsettia);
  • bigger lot (8125 vs. 7500), affording a nice back yard; and
  • orientation away from 2nd – to the south and west with PV/Catalina views.
And don't ignore the big-name, high-quality builder on Dianthus or the fact that, in buying during construction, the buyer had plenty of opportunity to customize the home.

Some of the assets on Dianthus would properly be labeled premiums, whereas Poinsettia is suffering from issues and vulnerabilities. Poinsettia is barely in the same league, which could become ever more obvious as the market works its magic on that price.
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