Still Slow on Poinsettia

Posted by Dave Fratello on Friday, March 20th, 2009 at 4:55pm.

2300 Poinsettia is moving ever so gradually toward market value.

Recall that this rather well-executed remodel (4br/3ba, 2050 sq. ft.) began in November at $1.749m.

That was a deliberate overreach at a difficult time in the market. MBC called a pricing poll (see "Pricing Poll: 2300 Poinsettia"). Side note: re-listing has wiped away records of this home's start price – the current listing looks like the home began at $1.599m, but MBC readers know better.

With a cut this week to $1.499m, 2300 Poinsettia may be getting toward where it needs to be. There are 2 other Tree Section homes in the $1.4m+ range that are comparable:
  • 1813 Pacific (4br/3ba, 2135 sq. ft.) began last July at $1.599m, took time off, and is now at $1.469m.
  • 1800 Poinsettia (3br/3ba, 2300 sq. ft.) began in early January at $1.579m, and has now trimmed to $1.499m. In June 2004, the home was purchased for $1.320m.
So 1800 Poinsettia is nearing its acquisition price. How about 2300?

This one was purchased for $1.269m in Jan. 2007. Yes, about 2 years ago. The markup (+$230k/+18%) now is all about the remodel. The previous version of this house was pretty frumpy, lacked a real master and had downstairs bedrooms that were kind of dark and depressing. All of those issues are addressed nicely in this crisp and thorough update.

We could easily see the remodel work having run $50k-$100k. (No inside info.) So the break-even point, if there is to be a sale, could be around $1.35m or a bit higher.

The majority of MBC readers responding to our pricing poll said 2300 Poinsettia wouldn't sell (23%) or would go for less than $1.3m if it did (43%). Just 22% thought it would go in the range it has entered now, $1.3m-$1.5m.

We don't imagine that the owner planned a pricey remodel only to break even or lose money, but we'll watch to see where this one ends up.
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