MBC writes only about homes west of Sepulveda. Today we feature the easternmost house yet – 1043 10th St.
, because it is now in escrow.
Congrats to the willing buyer and willing seller. Now permit us to analyze.
This is new construction, 5br/4ba, 3,950 sq. ft. on a large lot (7,500 sq. ft.).About that lot...
On the other side of the fence on the right side of the photo is the main local branch of the post office. Trucks enter and leave the loading docks just a few feet away for much of the day. A fairly screaming, hilly portion of Sepulveda is 25 yards away.
It's not all bad.
Right across 10th St., a mini-mall features ice cream, El Gringo, a high-end spa and a great wine store.
But still, the listing called for a discount.
No doubt the seller/builder thought
offering a discount by starting at $2.247m.
(That's where they started Jan. 24, though the property has been re-listed a couple times.)Roughly comparable Hill Section properties on the market this Spring ranged from $2.4m-$3.4m.
The low end, 601 Larsson
, is still for sale at $2.395m; solds with similar br/ba/sq. ft. included 938 Duncan
($3.23m), 108 S. Dianthus
($3.25m) and 624 6th
Comparable new construction in the Tree Section starts at $2.3m and quickly reaches $2.7m and higher. (We'll have to assume the buyers weren't so picky about location, and might have taken a nice Tree Section home instead.)The last list price on 1043 10th was $1.999m.
We won't have the sale price for a month, but let's assume it wound up near that.
So... the initial list price was at least 5-20% below comparable properties. We saw an 11% drop in the list price in 5 months. That means the location discount was at least 15%, probably close to 25%.
You know who this matters to most?801 11th
construction, a smaller home (by 950 sq. ft.) on a much smaller lot (4300 vs. 7500) in another compromised location:
the corner of Pacific and 11th, a stone's throw from MBB and backing onto a commercial building. That listing is at $1.995m today, having failed to sell at $2.45m last year.
Last week, our subject property and 801 11th were priced the same. Now, 11th is in trouble.
How eager are the sellers to cut again after chopping $450k off their wish price?
The news is also no fun for a would-be lot sale at 845 10th
. You don't have the same location concerns there, but when a new home up the street goes for $1.9+, you'll have a hard time getting your $1.875m for a teardown.
A whole separate line of inquiry... was this a profitable venture?
The builder paid $1.2m for the lot at 1043 10th. After costs of holding and selling, perhaps $600-650k is left. Let's just say: it's hard to build a quality 4000 sq. ft. home for less than that...