Two End the Suffering

Posted by Dave Fratello on Saturday, January 26th, 2008 at 5:58am.

True story: Your humble correspondent drove by the longtime listing at 232 30th Pl Friday morning, gave it a quick glance, and a little voice said, "It's time." As in – this one has suffered enough, it's time for a sale.

Imagine our surprise – well, maybe not surprise – to learn later in the day that 232 30th Pl is actually now in escrow, after almost 10 months on offer. Whoa.

Now, it's a contingent sale, so let's not jinx it, but it seems it might be time to say goodbye to another old friend.

MBC first featured the home in late April when it had a different address, 3009 Highland (see "Decelerating Returns.") We noted that the home had been sold frequently in the boom years, rising from $510k in 1999 to the $1.225m that the current owners paid in July 2005. When they listed for a modest markup at $1.369m, MBC viewed that as nearly flat pricing, and said:

"Here is a case of fairly realistic sellers. They don't expect a pot of gold for the trouble of living in the house for < 2 yrs. They're just ready to move on. They have room to offer price reductions without selling for less than they paid."

The sellers later changed the home's address, which confused us a bit (see "Changing Address Midstream.") They took modest cuts from time to time, and lingered at $1.289m for many months.

So let's do the math – if they pay out commissions at the near-bottom level of 4.5% in total at that price, they earn $5k. A sale price below $1.289m, or commissions above 4.5%, means a net loss. As charter members of the two-year-itchers club in 2007, the sellers here provide a warning – you may not get what you paid at the peak anymore.

At this point, regardless, the sellers have just got to be happy to be moving on.

On the same day, the longest-running listing west of Sepulveda also went into escrow.

Frankly, it ain't the same kind of story as 3009 Highland/232 30th Pl, but the new construction at 2709 Oak is in escrow now, last listed at $2.049m.

If anything, 2709 Oak was a warning flare showing that the Tree Section's $2m+ segment had stalled out, and that buyers would be insisting on quality and location henceforth. This newbie was first offered in August 2006, more than 520 days ago, at $2.395m, which must have seemed reasonable at the time, including a location discount.

MBC has mildly raved about this house before (5br/5ba, 3600 sq. ft.), and lots of readers have said here and privately that they liked the build, the brightness, the size, and, really, everything but the location and maybe the curb.

Not long ago the builder set an absolute minimum of $2.050m, perhaps reflecting a break-even price. Once list came down recently to that level, though, you had to figure it'd sell somewhat below. (The lot was purchased for $920k in April 2005.)

Botttom line: It's likely we've got another case of new construction selling for a loss in the Tree Section.

These two sales dredge up a thought about one more – the new home at 911 Duncan in the Hill Section was on the market more than 7 months when it went into escrow earlier this month, at a new list price down $470k from start.

Could it be that buyers here in January are bona fide bargain hunters?
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