Based on the exterior and owner (artist Amado Gonzalez) we had high hopes to see some wild things inside 179 Delmar. Unfortunately not. But at least some good bones.
∙ Listing: 179 Delmar (4/2) – $1,179,000 [179delmar.com] [MLS]
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Based on the exterior and owner (artist Amado Gonzalez) we had high hopes to see some wild things inside 179 Delmar. Unfortunately not. But at least some good bones.
∙ Listing: 179 Delmar (4/2) – $1,179,000 [179delmar.com] [MLS]
nice.. I hope the new owner repaints the green parts with fluorescent pink.
Wow. Some of those pictures look like an inspections nightmare. Good bones at best. With some serious money it could be a really, really nice rehab!
Why so barren? All those bare, deserted rooms look so sad. This price strikes me as eminently reasonable for San Francisco. But I’m an East Bayer and don’t know the neighborhood. What’s it like?
That color is such a blight on an otherwise beautiful block of Delmar.
Nice fixer-upper…
The $1.2M fixer-upper. Only in San Francisco!!
Yeah, this is pretty much my dream setup assuming no hidden problems. First up, retiling the bathroom and painting the front white for that Tudor authority. Everything else can be tarted up at leisure. You even get a piece of water to look at!
I took a “drive by” yesterday. What struck me is the lack of sunlight you’ll get due to the abnormal lot layout. This is the opportunity to buy the worst house on a great street though.
I am suprised that any agent can let a house hit the market (especially “this” market) without a proper staging. If only to distract from that kitchen floor and backsplash. But you’re right, this property has the potential to be really spectacular!
Picture #11 makes it look like there may be toxic mold in the basement.
$$$.
I’m a convert to the toxic-mold-is-really-bad school… I’m seeing lots of major symptoms related to it… and not from people trying to sue anybody either… honest to goodness issues
asthma
wheezing
cough
respiratory symptoms
chronic sinus infections
headaches
fatigue
dizziness
nausea/vomiting
etc
[Editor’s Note: And for those who might not know, “ex SF-er” is a physician.]
Delmar is a great street, looks like some foundation work is need though, among other things.
It needs a lot of work, to the point where there is no point in staging. I did see them cleaning the place out and from what I saw going on it seemed that they did put on some fresh interior paint.
It is a good price for the lot size and the size of structure all ready there in this neighborhood. There does appear to be a lot of foundation and structural work, really a gut renovation would be desirable at some point.
Personally, I hope nobody comes along and paints this some bland colors, not my favorite color but nice variety at a fairly conservatively painted section of Delmar. Painting it white or beige would certainly be a sin like the victorian at Java and Buena Vista.
ex SF-er, how can you tell from the picture that it’s toxic mold? What would one look for?
If you want to preserve the style you don’t paint the whole thing one color, you’d just replace the green with a cream color. Not that there can’t be a such thing as a stylish Tudor (Revival), but the lines are pretty restrictive. By all means, go with praple!
Depending on the amount of work needed on the systems (including the mold), this may be a very good value. Unlike all the modern one bedroom condos for sale for the same price or more, this is a real SF house in a real SF neighborhood, with nice views. If the basic stuff works, the decoration could be done over a period while living there. Compared to a lot of the stuff we see on this site, this is a home, not burdened with excessive modernity or the taste of some decorator. There is a lot of potential for so-called “pride of ownership.”
The pride of brick foundations, toxic mold and asbestos shingles (and heating ducts)
If it does have brick foundation that has to be replaced, sparky is right that it compromises the property, depending on how much it costs to replace. Asbestos removal however seems to be something that is done relatively quickly, but I am no expert. This property looks like something that would be acceptable to Herb Caen. It looks like SF, unlike most new developments that look like Atlanta.
this is a sweet fixer. i wish i was looking for another project b/c this one has awesome potential.
lisa and jim (the brokers) know what they are doing-they just had the floors redone and the place completely cleaned out.
btw, re toxic mold; don’t believe the hype!
i just finished replacing a brick foundation and adding a new concrete slab in an 800sq.ft.area (25ftx32ft) and the total cost with engineering, permits, mat./labor and special inspections came in just under $20k. it took a month to do the work and the building remained occupied during the project.
removing the mold and asbestos shingles on this project will cost less than $1k and take about 2 or 3 days.
this place is going to be sweet eventually.
paco,
The asbestos will cost way more that $1K for sure, if you do it with an abatement company (which you should). The foundation here is a lot more 25×32, and the front of the house is a standing brick wall.
Plus I want to go look at it so stop saying how it won’t be that expensive. It will be very, very expensive to do this work. Much more than the estimated $2M at Pacific street.
ahem, quite right there spark..very expensive work to be done,
very expensive…
Well, I wish it were just a cosmetic fixer. It’s unfortunately closer a tear down. Major remodel for the upstairs to get a second bathroom in the place. You can add some living space inthe basement, but that’s after you jack the whole thing and remove the brick foundation.
2 million to do the work. sparky, do you really think throwing out false numbers like this will keep the competition away? 🙂
Paco-
“btw, re toxic mold; don’t believe the hype!”.
Since when are readers going to trust a developer over a doctor on the health issues associated with mold…
Nicole,
The doctor may be correct about the health effects of mold, and the developer may be correct about the severity of the mold issue in the property and the cost to fix it.
🙂
you are right nicole,
if you ever see any mold you should always assume its super gnarly toxic and run the other way.
anon,
$2M may be a slight exaggeration.
You don’t need to run, just order a mold inspection prior to closing.
Yeah right that into your contingencies, while no one else does. Then see if you get it.
write not right, right.
mold has definitely been associated with significant health problems, especially for those with sensitivities. If you don’t like to read medical journals and more academic sources on the subject, here is an “extreme home makeoever” special on it…
http://www.youtube.com/watch?v=V3_6ZOh-u0c
I agree that you would loose out to another comparable offer with no contigencies, but if this was to be your home where you would raise your family, (and where you are sinking 1 million dollars off the bat), wouldn’t it be worth the risk?
Plus, in this market, especially in the past few weeks, there have been very few multiple offer/overbidding situations…
On most properties in SF right now- you could probably order a mold inspection and insist the seller do the Macarena for you before closing and still get the property.
mold schmold,
its caused by bad ventilation and moisture. eliminate those factors and remove the mold and voila.
ain’t no thing but a chicken wing…
as long as it can be easily contained and addressed early on, I agree with you.
This property, in this location, will not do a Macerena for you. This is a fixer in a good location. This is exactly the kind of property that has not come down in price. Yes it’s over a million, so is every Noe fixer. This place will get multiple offers. I have written 3 offers in Noe for fixers recently, all at/over asking, none of which was my offer even considered. All of them had no contingencies.
if you’ve been to the subject property we’re talking about some visual mold at the rear of a vacant property. no big deal.
remember folks, this place has great views/light and a huge lot and three of the neighbors just up the street are on the market currently for $1.9m, $2m and $2.8m.
Sparky, Things are sitting on the market, buyers can absolutely ask for contigencies right now. The developers specials you made offers on probably appealed to developers only. Most people reading this site are not developers. They care whether the house they move into has mold because they most likely won’t gut it as soon as they buy it.
As for this delmar property, never been there. Someone expressed concern over mold, so my suggestion to buyers who are concerned–get an inspection, its easy. And don’t listen to people who say toxic mold ain’t no thang.
The places I wrote offers on are “developer specials” in the exact mold as this one. Is this a “developer special”, I guess so. But, I doubt only developers will offer on it. I am sure a family or 2 is eyeing it. My point is that the developers will not have any contingencies (exept maybe loan), so all else being equal the seller will go with the developer (or family who write it contingent free).
Things like this, and places like the other artist’s place (recent SS thread) are not sitting.
Are the last “bulls” those who felt that their perhaps excellent work and management on refurbishing properties was the cause of enormous profits, when in fact it may have had little to do with their skill and finished product at all? During the last downturn, I remember outstanding properties, of the most sophisticated design, in the best parts of town, sitting for months with multiple price reductions, and no action. We are about to see if it was all the current tricks (flames shooting up in rear landscapes, glass staircases, zen-spa-baths, sleek italian kitchen cabinetry, etc. etc.) that caused homes to sell, or was it just easy credit and a speculative bubble?
If doing excellent work and managing a project well makes me a bull then a smiling bull I am.
better lucky than good they always say…
Sparky,
You read things so literally. I wasn’t suggesting that all sales in SF have ceased to exist. But Real Estate in SF is starting to sit. Lets take the district you have said you build in- District 5. The Days on the market for single family homes has risen 78% year over last, and condos 110% (terradatum). That is a significant change.
Sure incredibly desirable properties (either for their current attributes or future potential) are moving, but the average property in SF isn’t moving nearly as quickly as it used to.
nicole,
what you wrote about the average property not moving is completely correct. what many bulls will counter is that its still not possible to get a ‘great deal/macarena’ on desirable properties.
the only thing that is likely to trade in this environment is well priced good stuff or slash rate priced crappy stuff.
smart people will hold on if they don’t need to sell-but some people may be forced to sell at this difficult time and, like many of the world’s best hedge funds, they will get pounded. still, that does not mean the house of dreams will become suddenly cheap..
right, but I switched tracks with that macarena post to talk about SF real estate in general and the ease of writing contigencies…started with the qualifier-“On most properties in SF right now”
But I completely agree with what you said Paco. There are plenty of people with money in the SF Bay Area looking for a home, but they are being choosy now, waiting for the “perfect” one. In today’s current environment, when those ones come on the market, there is absolutely competition for them.
Nicole,
I wasn’t “reading things to literally”, I was staying on topic. 179 Delmar. You were expanding to describe the general market. That is never the way to look at a singular property. So, will places in town sit, yes. Will this place sit, no.
FWIW, I don’t just build in D5. I used it hear as this place is D5 and I have been writing D5 offers (which didn’t sit).
yes and no; D5 trends are important to understand if you were considering picking up this property as an investment.
To elabroate on why D5 trends matter to investors-if you were going to pick up this place to flip – will this place get multiple offers as a fixer right now? Most likely.
Will this place get multiple offers as a completed pristine end product? Most likely not, unless it is extremely well done, and extremely well priced. Check out what is going on with D5’s flips right now, which is relevant to 179 Delmar.
i’m betting nicole has no real info on the economics of any flips in progress in town. i’m betting she is assuming all kinds of things that she has no knowledge of.
“will this place get multiple offers as a fixer right now? Most likely.” –that is my point exactly.
D5 fixer trends are relevant. That is what I was saying, and not what you were saying. Because you “switched tracks with that macarena post to talk about SF real estate in general and the ease of writing contigencies”.
So again I’ve been writing contingency free offers at or above asking and not even getting countered. Which speaks to your, “Check out what is going on with D5’s flips right now, which is relevant to 179 Delmar”. Delmar is that, but it is the fixer part of the equasion and not the finished house part.
I totally agree that the finished price house is coming down, and that the fixer is not. I’ve been saying this for months and months. It’s also why there will be a lot less finished flips to hit the market in the next year+.
Paco, sometimes when you bet you are wrong…
The “mystery” of why fixer prices are still high, while finished product is beginning to show significant weakness, is no mystery at all.
Over the past few years, small scale contractors and “handymen” have done quite well. Some have amassed a reasonable amount of cash. Others have made contacts with similarly small scale “investors”. Still more people – seeing the success of contractor/flippers over the past decade – have entered the market as well. We’re not talking brain surgery or mathematical cryptography here – the barriers to entry just ain’t that high.
More participants + more access to accumulated and “investor” money = higher prices for the fixer properties. Simple as that.
Wait until the small scale contractors start going belly up (absolutely inevitable) as they try to outbid each other for the intermediate goods (fixers) in a declining market for their finished goods. Fixer prices should then fall. The smart contractors who are still left standing will then have a very good opportunity to make outsized profits again because the ones who overbid will be washed out, and will have to peddle their skills to the ones who were smart.
nicole,
as they say in the stock market, you only have to be right 51% of the time…
so do you have some actual info about flippers in trouble?
econ 101,
you make good points but ignore a large part of the picture.
its not just flippers who compete in the market. the economic
suitability of a property is very different for contractor/ flippers or investors or owner occupiers. put another way, the price of a place matters way more if you are keeping it versus needing to sell it.
I am sure this property will sell for more than asking.
Many still have cash to throw at the current bonfire of equities.
It’s a really really good thing. That’s that much less competition when places will have reached rock-bottom in a few years.
Paco, I’m not going to list the expenses that my friends/aquaintances have put into their projects on a public forum or even draw attention to the ones in trouble. That would be insane. Plus, why would I tell the sharks where to feed?
I never said 179 Delmar wasn’t going to sell for more than asking, I just said if you were going to be an owner occupier and were concerned about the mold you saw, get an inspection.
Question for sparky and paco: You both seem to agree that home prices are now falling throughout San Francisco. Yet prices for fixers seem to be more resilient.
Why, then, would you still be bidding on properties? If the price of your finished product is falling, while your input costs are not, why buy into margin compression? Maybe other costs (like labor or materials) are coming down as well, or maybe your margins are still wide enough that you can absorb higher costs. But don’t you run the risk of getting caught on the wrong side of a failed flip?
So here is the question: If this is a major fixer, which it is, and if construction loans are very very difficult to get to pay for the fix, then wouldn’t you need in yourp ocket 30% down plus all the fix cash to make this work?
I would guess that finished product homes, where you can finance 70% of the finished product, would be in greater demand. In this case you are talking 800k+ in cash to acquire w/ 30% down, pay closing, and make this house come close to its potential. If a buyer has 800k cash, is this what a buyer wants?
Dude,
You always risk a failed flip good market or bad. I trust my skills on how to make money. However, I won’t overpay and so I haven’t bought anything. There are of course tons of other factors. A short list is below:
I can only take designers so often
I can only take homeowners so often
I can only take architects so often (not you Darren)
I am a bit of a gambler
It’s only money
I put in quality time with der fluj
I am committed to employing my crew
The Mayan long count ends in ’12 anyway, so F it.
Thanks sparky. So basically you gauge what your margin would be and set your bids accordingly. And you don’t buy properties where you can’t safely make money.
But if those properties are still selling to other developers, it implies one of two things:
1) Other guys can build a comparable product at a lower cost than you.
2) Or, more likely, other guys are overpaying and are likely to get hosed soon (i.e. econ 101 above is correct).
I’m neither a gambler nor a believer in Mayan cataclysm theories, so I guess I’ll just have to stay patient and wait the market out.
I think that the people who are buying high are going to get hosed, unless they are adding lots of footage. In which case the time it takes to get permits and build may miss a big down turn and sell back to a better market against less competition. Still some gamble there, but the more new footage the less gamble.
This in not the case at Delmar. Here you may have the other category of overbidder. The home owner who thinks construction is much less than it really is, or they can run the job themselves to save money. Or that construction prices are bound to come down, so they’ll “come up”. All bad bets.
Also, I had expected to see lots of permitted plans hit the market. Some buys a fixer, pay an architect, gets bids, and realizes it would be better to buy a finished house than pay out of pocket for what they permitted. I haven’t seen that yet.
Just a little OT, but speaking about overpaying for fixers, failed flips (and price declines apples to apples), this one might be worth checking out:
http://www.redfin.com/CA/San-Francisco-County/200-KENWOOD-Way-94127/home/1590630
I know the block well and the neighborhood, which is a very nice one. I don’t know the back story, but it looks like this one was bought as a fixer/flip for $1,058,000 in 2006. It was cosmetically remodelled, with space finished in the lower level (no permits – common out there). And now it’s a short sale, asking $995,000.
Good thing this isn’t the real SF (but I know you know this area well, sparky-the-bear)
Nice comp for the area ($339 psf)! People REALLY overpaid out there in 2005-06 (almost as bad as Merced Manor), and 30-40% declines from peak are in the bag IMO by end 2009.
i’m surprised that the bears cannot come up with more stories about people over reaching and then having to punt. ok, maybe in daly city or d10 or wherever (those outer burbs the above poster cites so often?)
c’mon bears! thousands of units have traded in real sf in the last few years so where’s this 30-40%
drop happening?
now i know this is an easy one for you bears so i’ll sit back and wait to hear about all those rotten apples…
paco,
Let me beat everyone to it on one I already posted. It’s on 22nd street at like Douglass. Asking $1.45M. It’s half done, but all wrong. This was not done by professionals.
Laugher,
That did you notice that next door is (still) on the market for $1.5M. Way to much money for over there. You can be North of Monterey for that money, or in West Portal.
“I never said 179 Delmar wasn’t going to sell for more than asking, I just said if you were going to be an owner occupier and were concerned about the mold you saw, get an inspection”
Get an inspection. OK. Don’t ask for money back in a competitive situation. Or else saver your money, you know the property needs all sorts of work, buy it, hire the right people, and get rid of the numerous problems present.
What you said varied. One guy posting from Minnesota thought he saw some mold in a poorly lit internet photo. For some reason he saw fit to drop the buzzword “toxic mold” on this thread. In response, you spoke broadly about contingencies returning to the market as a whole. There was a disconnect because the dialogue concerned this specific property.
One thing about fixers’ stickiness is the HGTV factor. People still think they can tackle these problems. One very successful design-build client of mine calls it the “housewife factor.” Apologies to house husbands everywhere. Maybe more TV shows need to get cancelled before the fixer goes the route we all think it should.
rumored to be in contract (thanks steve) for
$1.3m with ten bids. apparently the offer was so solid that the sellers did not counter any of the other nine bidders.
I was told that 42 disclosure packages were downloaded, and they expected at least 12 offers. All end user types. So I called my client and said not to bother writing. So, 1.3M. It will take 400K minimum to make this place shine. A novice will pay much more than that. However, for an owner who wants to put down roots, is still makes sense. Even going back 8-10 years or so you’ll still find $2M sales in the neighborhood.
What do you bears make of this?
It is possible that the new owner might simply do minimal upgrades (less than $100K) and live with a home that isn’t 100% renovated. Why do we assume that the buyer’s outlay must be purchase price + cost to bring up to the state of the art ? Not even all flippers do the full upgrade.
Speaking of houses owned by artists that are far far from modern ideals, does anyone know what happened with David Ireland’s house ? I’m hoping that someone came up with the bucks to preserve it as a piece of conceptual art.
Fluj – I disagree with your $400k. There were contractors and structural engineers crawling all over that place. Perhaps a contractor could do it for $400k himself, but not a retail client. The market is pretty efficient, so the fact that 1.3 was the bid, implies that interested parties were looking at 600+ do do it right and get it up to par with the better homes in the neighborhood. Recall the contractors inspection report suggesting “full down to the studs remodel”. There is no kithcen ( 80k+ to outfit a good one), water damage everywhere upstairs and down likely requiring siding and maybe roof replacement. And while you are at it, replace the brick foundation. Throw in architect plans, removing a full gravity furnace system w/ asbestos to be removed. Plant grass in the mud pile. Two years of carrying costs. And on and on
not sure?,
for someone who is not sure about this you seem to have alot of ideas about it.
roof is new already, water damage was not severe enough to pull down any plaster, furnace removal and replacement runs maybe $5k (retail), foundation is all easily accessable if replacement is desired but the house isn’t showing real signs of settling, and a truckload of sandy loam delivered and spread around in the yard would take one day and less than $800.
in fact this house is liveable right now (floors and interior paint just done, bedrooms, living and dining are all fine) if you do not mind the pink/lavender bathroom.
spend some time/$ on the kitchen and the addition to the side and do a minor remodel on the downstairs rear apartment.
i wish my friends had been able to buy this place on the cheap
($1m sounds about right) but even in this market when good seats become available people jump.
Sold, 12/30 for $1.31M. If it was all cash, I wonder why it took so long?