Tree 'Rockets' Land

Posted by Dave Fratello on Thursday, August 16th, 2012 at 2:13pm.

Among the more interesting recent Tree Section sensations are 2 homes under 2000 sq. ft. with great locations.

Both first made deals in June, and closed this week.

We mentioned both in "Rockets in the Trees" back in June. Here's how they wound up.

754 26th
754 26th (3br/2ba, 1775 sq. ft.) is a cute 1960s cottage with some updates (not the kitchen), good flow and a nice, sunny, south-facing yard. It's in a sweet north-of-Valley location, walkable to school.

The sellers drew multiple offers on a list price of $1.299m.

Dave had clients in the mix, and here's what we were all thinking at the time: Why not try to price it right? Why go low? You just incite yet another bidding war, with all the mystery and fear and dashed hopes that brings.

It was challenging for everyone. In the end, someone's all-cash offer won out. The buyer paid $1.475m. No doubt, others would have paid a little more. But all-cash rules.

That was a $176k overbid, +14%, but, yes, there were people willing to go further.

Suffice it to say, if you've got a darling home with a decent-to-good location, even with just 3br and about 2k square feet, it could be a $1.5m house now. (Hello 571 29th, we're thinking of you, too.)

1812 John
1812 John (4br/2ba, 1750 sq. ft.) is something of a different case.

You've got the surpassingly cool location. John and Palm between 18th and Marine represent a unique, prime submarket. (Need we remind you again of the 20-offer lot sale nearby at 1805 John? See this post.)

The house here at 1812 is imperfect, to say the least. (See our review.)

The original list, which triggered a bidding war (by design), was at $1.199m. We heard that the first "winner" offered $1.45m.

But inspection issues – big problems – cropped up. The property came back to market. The second time, they asked $1.399m, obviously $200k higher than that first list, and (less obviously) below their prior deal price. They were trying to reflect what they viewed as the market value, warts and all.

And now the final price at 1812 John: $1.330m.

How do you measure that?
  • It's +$131k (+11%) over the way-back original "auction" start price. 
  • It's -$121k (-8%) off the first deal price. 
  • It's essentially equal (-$21k) to the lot-sale price at the far superior neighboring property at 1805 John. 
Land value at 1812 should be notably below 1805, because 1812 is on an awkward downslope and has a fairly shady backyard. 1805 is flat and has a sunny, west-facing backyard. That, and the $1.35m land value at 1805 surprised absolutely everyone. It may have set the market, or could wind up being an anomaly in hindsight.

So what will the new owners try to do with 1812 John? If they start from scratch, at least we'll have a firm answer on land values in this pocket of town.
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