Third Spanish TH Asks the Most

2216 Manhattan Ave.

When we saw 2216 Manhattan Ave. pop up as a new listing, the first thought was: Hey, didn't they just buy that? 

We've had a few of those cases recently around town, but not this time.

Many townhomes look alike, especially this one, as it is in the same building as 2 other recent sales.

Yes, any buyer looking at this Spanish, beach-close TH (with 4br/4ba, 2580 sq. ft.) is going to have 2 recent sales to use as barometers – same building, same vintage (2007), similar views, and sales in both 2007 and 2011.

The third TH in this building to be offered for sale recently is now coming out at the highest price: $2.599m.

Neighbor 2212 Manhattan Ave. (4br/4ba, 2600 sq. ft.) sold off-market last April for $2.5m. (More on that in a sec.)

But the other neighbor, 2211 Bayview, directly attached to 2212 Manhattan Ave. and right up behind it, sold on the open market in Sept. 2011 for $2.065m.

You can do the math. That last open-market sale was for $534k less than the new listing.

Ocean Views from 2211 Bayview

And while you might assess those sold units differently, we found the ocean views in the rear unit (the "cheaper" one) at 2211 to be terrific – you can actually see over the rooftops across Manhattan Ave. out to the sea. The tradeoff is, you're on an alley.

There are surely some views of blue from 2216 Manhattan Ave., but are they as good as the units higher up?

Last year's open-market trade at 2211 Bayview, compared with the off-market sale of the front neighbor, prompted MBC to go on a little rant about the perils of off-market sales. Be careful what you wish for, for you may find it – and drastically overpay. (See "Off-Market Sale May Be No Deal," Sept. 2011.)

The open-market sale at 2211 Bayview was at 13% off the 2007 acquisition price, somewhat better than normal for a peak-to-now resale, while the off-market sale at 2212 Manhattan was a $50k markup over the 2007 acquisition.

A markup over '07.

Way-back-when, in 2007, a year that still had some bubbly froth while the market had clearly begun to change direction, here's how the 3 new Spanish THs in question sold:

• 2212 Manhattan: $2.450m (June '07)
• 2216 Manhattan: $2.400m (Aug. '07) – the new listing
• 2211 Bayview: $2.370m (Sept. '07)

So, yes, at $2.599m now, the new listing is hunting for one of those markups over 2007 like the neighbor got. A better one, actually: $199k, or 8% over 2007.

Remarkable as it sounds, neither of those neighbors in the same development would count as formal comps in a professional appraisal. That time window is limited to 6 months. (And off-market sales should be excluded as well.)

But that's not going to stop buyers from taking note. Right?

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While we're (virtually) in the neighborhood, let's look at the recent closed sale at 2405 Bayview (2br/3ba, 1975 sq. ft.). This is a smallish TH with a bunch of deferred maintenance outside. (Letting the HOA lapse sounds good when it saves money monthly, but then you get a situation like this.)

This one came out with a list price of $1.749m in Sept. 2011. In our review, we concluded, "neither the number of bedrooms nor condition justify [that price]." The unit had previously traded in the bubble era (Nov. 2005) for $1.750m.

The market rejected that rescue-price sale and 2405 Bayview became a short sale.

The attraction of the unit is its giant ocean views from an older (1983) building that exceeds height limits for new construction. And we did think the TH had a certain "Old San Francisco" appeal.

2405 Bayview has now closed for $1.4m, or 20% off the 2005 price.  

Not that it will be a comp for anyone, formally. Short sales are supposed to be excluded by appraisers, too.