The sale of 313 Duncan closed escrow yesterday (4/14/09) with a reported contract price of $2,400,000. Once again, purchased as a much smaller “fixer” for $725,000 in 2004…
313 Duncan was completely transformed and expanded to 3,200 square feet of living space (including a new one-bedroom out back) with Owen Kennerly at the design helm.
Listed post-transformation for $2,850,000 in October of 2008, and then offered as a rental for $15,000 a month (including the one-bedroom) in December, the list price eventually worked its way down to $2,495,000 (and the asking rent to $9,500).
Keep in mind that 313 Duncan officially sold for 3.8% under asking according to industry statistics (and not 15.8% under its original list).
this is probably going to be another shocking news to the bears here.
Not to me.
There have been two homes that came on the street where I live. For a 1200 sq ft, and asking $799K, one sold in 3 days, one sold in 4 weeks. My house is 2600 sf ft, and i paid $750K back in 2004. So, let me about “going back to 1999 prive level”.
This property is 3200 feet, in the flats, and it sold for 750 a foot. It had some very specific design choices that were not for everyone too. The developer is likely disappointed somewhat. But in the end this will pencil in as quite a big success. Its 725K purchase helps.
I can see it now. 2011, when this place is for sale at $1.9M and languishing, someone will come on SS and say:
“750 per foot in 2009, in the flats? That was never going to make sense. Comps were what? 650psf at most, and this one was a much larger house. So, yeah, prices are down a tiny bit, but this was always going to be tough. I don’t want to give the pat answer that the bears want me to give, but yeah, I think they overpaid and I think I’ve shown it.”
The SF MSA is showing one of the largest percentage declines in the country, and the largest implied dollar loss per property. There are still a lot of suckers “overpaying” still in 2009, even if there are fewer of them than in 2007 and even if they are now overpaying a bit less egregiously.
I’m not surprised but then again I never try to predict price.
this just goes to show what we’ve all known for some time. good/great properties in good/great locations will sell, although some will need a small discount.
I’ve never been to this property, but the negatives seemed to have been odd layout (that’s what anonn stated) and being in the flats of Noe. maybe also somewhat taste specific. But few commenters thought that it was a dud… most thought overpriced.
that said: the layout looks pretty normal to me (LR, DR, Kitchen, Family room on 1st floor; 3 BR and 3 bath on 2nd floor, bonus room/BR on main level). also great guesthouse. but I haven’t been in it, just saw the floorplans.
flats of Noe might not be uber prime, but I’d still guess it’s considered quite desireable.
regardless, I think this place looks awesome in the pics. I usually hate the Dwell knockoff/pseudo modern look… but I really like this place.
it was well done. a huge improvement from what was there.
I do NOT consider these guys “flippers” I consider them renovators.
I would be happy if they made a profit. (who knows how much they sunk into this place). more of this should be encouraged.
It is for sure a nice neighborhood. At peak the flats commanded nearly the same prices, and sometimes even the same. The design choices are pretty palpable. As soon as one walks in the door there’s a gap to the right, and it is a step up to the raised living room. The glass ceiling upstairs is neat, but one of the bedrooms feels very compartmentalized. The back studio is great for someone, but it also takes away from the size of the backyard for many. I liked the place. I thought it was really cool. But it felt “designy” for lack of a better (or actual) word.
Hopefully the right buyer came along, and loves it. A lot of time, effort, expense, thought and personality was injected into its development. So hopefully the new buyer will stay there and enjoy it for years to come.
What I think hurt this property is baby gates. The raised living room is all steps up to it, and at the front door is a drop off (of 2 steps, not a “gap” as anonn said), then you have the stairs to the bedrooms which fall on the raised living room, and also the ent. room (and yard access) is down like 6 steps off the kitchen. The flooring is either hardwood or concrete.
I could not imagine living there, nor could anyone with kids under 3. That rules out the stroller brigade that populates Noe. Not a great spec. project decision for the hood.
Oh, also the horizontal railing pickets (and not vertical or solid) is a kid hazard as well.
Wait, I have a specific question here: the flats of Noe are actually considered less desirable than the hills? What parts of Noe command higher prices vs. lower?
I ask for a couple of reasons: 1) until two months ago I was shopping for a condo in the area, but stopped due to all the valuable advice I found here on socketsite (and elsewhere) and 2) I wound up renting a place in Diamond Heights, but literally ridge on the edge of Noe. I’ve been under the impression from my property searches (both rental and purchase) that as you go up the hill on the western side, prices go down pretty significantly. It’s part of why I moved where I did–I have a fantastic apartment with great views that I never could’ve afforded in the “flats” or the more core neighborhoods.
Just trying to get more understanding of the local sub-markets.
Jason:
Don’t listen to anyone here is my advice.
Most everyone here, specifically the regular posters have two things, time and opinions. And usually the time is the only thing that is reliable.
If you buy, do your research and take your time as nobody is forced into as-is/quick closes anymore and do so with a time line beyond 5 years and don’t worry about the short term peaks and valleys.
Even at the reduced price this sale is indeed bad news for the NV bears. The original listing price really was just pie in the sky so I wouldn’t read too much into it.
To annon’s point, I went into the house too and it felt in some respects over stylized. Nonetheless it was well done and the back guesthouse is an added bonus. The big drawback for me was the immediate neighbors to each side of the property – a medium sized apartment complex and a SFH in disrepair. Despite this the developer was able to sell for $2.4MM. Very impressive and no doubt a success considering the original purchase price…
Jason,
Traditionally the areas with bigger, city views that are within a few blocks of say 24th and Noe, are the blocks that command the biggest bucks in Noe. “The flats” is sort of an anachronism at this point … I haven’t heard it used too much in about five years, and it was mostly older r.e. people who said it come to think about it. That’s probably since Outer Church street came along in terms of restaurants and shopping and the Fairmount Heights north slope of Glen Park got really pricy. So nowadays there isn’t a big difference any more. However, there is still a bit of a premium for premier Noe. This isn’t a hard and fast rule or anything tho. Exceptions abound.
Wait…i thought list price doesn’t matter…only sales price. You can’t (fairly) play this both ways to auger your position.
Also, Lmrim- you’re falling into circular reasoning. If enough (as you refer to them) suckers are buyin guess what, by definition THEY become the market! And from what I’m seeing, there are alot of people wanting to buy and own in SF. Ironically, the SF buying population is also one of the best educated and intelligent on the planet. At a certain point your arguments are quitoxic in nature, akin to fighting an endless array of windmills 🙂
This sale, and 22 Hoffman going over asking, seems to me that while we’re still definitely in a depressed market (and will be for awhile), good places in a good location will still sell well (and that there is still some serious $$ out there in folks’ pockets).
I wonder if some of the lower interest rates are spurring some of this too. I can’t help but think that there are some folks out there that got into a great place in, say, 1995/96/97 or so, and also have done well income-wise. Now they are in a position to upgrade to a $2M+ house due to a very nice profit from their existing house, using that as a large down on a new place, and are ready to upgrade with rates this low.
That seems to be a bullish price.
This is a great project, blending traditional exterior design with a more contemporary interior.
so what if the interior has a few steps and different levels. This does not necessarily preclude a young couple with kids. They do grow up. If you’re so worried about the little rug rats falling, then make em wear a helment when they’re inside.
your right, noearch, I think that is how most young families would see it.
“We could buy a different house that suits or needs better, but let’s just make our kids wear helmets inside,” said Geoff. “Maybe you should have had a helmet on a the gym yesterday, because it sounds like you hit your head,” scolded Celeste.
Hey, it makes them safer outside too, so why not just glue ’em to their heads.
Ironically, the SF buying population is also one of the best educated and intelligent on the planet.
Not so ironically (well, for most people out there), the “masters of the universe” who drove the world’s financial system off of a cliff would also be considered part of “the best educated and intelligent (sic) on the planet” subset to which you allude.
So, what’s your point here?
you realize I was being a bit sarcastic and playful with those words?
About intelligence and the SF buying public, Sir Isaac Newton himself fell for the South Sea Bubble and lost a good deal of capital in it.
He was reported to have said, “I can calculate the movement of the stars, but not the madness of men”.
Financial intelligence and economic intuition are not widely distributed and are not necessarily correlated with traditionally-defined “intelligence”. I’m pretty sure that there is no one in SF today as smart as Newton. I know I’m not. And yet I wouldn’t have fallen for the South Sea Bubble, that’s for sure!
Most everyone here, specifically the regular posters have two things, time and opinions. And usually the time is the only thing that is reliable.
There has been quite a bit of analyisis here regarding the markets. This includes how various areas have and continue to compare to each others, what features are desirable and likely to continue to be so, and more. This remark about opinions sounds like someone being sour about the bubble finally popping.
If enough (as you refer to them) suckers are buyin guess what, by definition THEY become the market!
Until their creditors object or losses become to great to ignore or both. This only sales are the market attitude isn’t really interesting. Housing markets have characteristics that are consistent over very long periods. Intrinsic value is always a slippery fish, but that doesn’t make it any less tasty.
noearch,
I was kidding too, you really can’t glue helmets to your kids heads eventually their hair grows out and break the bond.
The more properties that sell for real prices the better. I suspect the buyers are very happy. It’s a nice, statement, and now infamouSS home. The sale price feels about right considering what you are getting. Anything less than a 5 year hold could be a disaster here, but this home is/was available today and the buyer got his home. Congrat’s.
Sir Isaac Newton himself fell for the South Sea Bubble and lost a good deal of capital in it.
Newton is my favorite intellectual — I think the smartest man yet. But for investing, it’s hard to find a public intellectual with better returns than Keynes. Some choice quotes:
“The dealers on Wall Street could make huge fortunes if only they had no inside information.”
“When I can persuade the Board of my Insurance Company to buy a share, that, I am learning from experience, is the right moment for selling it.”
“The market can remain irrational longer than you remain solvent.”
FWIW, Keynes cut his teeth by speculating heavily on margin in currencies, equities, and finally commodities. He was almost wiped out a few times, but ended up earning a CAGR of 70% (but levered 10:1).
Subsequently, in 1927, he became one of the first “value investors”, laying out key principles prior to Graham. He eschewed leverage, and managed investment portfolios for King’s College, earning a 12% CAGR until his death in 1946. During the same time, U.K. stock market had a slightly negative CAGR.
“The original listing price really was just pie in the sky…”
Given that both the seller and their agent who set that “pie in the sky” price were real estate professionals, we’re led to believe either one of :
1. They are out of touch with market values
…or…
2. They were trying to dupe a buyer into grossly overpaying
Either way this does not set a very good tone for heeding the advice of “professionals”.
good point sparky-b:
besides, maybe this house will keep some of the stroller brigade away. it seems to be getting a little out of hand these days.
“The original listing price really was just pie in the sky…”
Given that both the seller and their agent who set that “pie in the sky” price were real estate professionals, we’re led to believe either one of :
1. They are out of touch with market values
…or…
2. They were trying to dupe a buyer into grossly overpaying
Either way this does not set a very good tone for heeding the advice of “professionals”.
Huh? The buyer’s “professionals” worked for the buyer. The seller, a professional, also had a professional working for him.
What dupe? Nobody paid the high price. As is their right, and as likely advised by “professionals.”
Wow. That was a funny bit of pretzel logic, that one.
I can see it now. 2011, when this place is for sale at $1.9M and languishing, someone will come on SS and say…
LMRiM, you’re at least 1/2 right. If someone paid $2.4 million for a home and then sells in 2 years we’ll be on here saying “what did they expect”.
If they wanted an investment they shouldn’t buy one of the most expensive houses in the area, that is so unique that it can’t appeal to the widest possible audience.
As for the “flats”, I’m not sure if anonn is referring to all flat areas of Noe, but flat tends to be worth more in Noe, but flat and close to 24th is worth the most. I don’t think this location is a $2.4 location. Nor is it’s extremely unique modern. So IMO they did over pay.
By the way, I’m pretty sure 1037 Church is in contract although the MLS doesn’t say so yet. Asking around what 313 Duncan was originally asking… IMO we will not be saying they over paid for that one in 2011.
hangemhi,
I appreciate your willingness to come out and say, ex ante, that the current buyer is overpaying. Most agents on here don’t seem to have that ability to make a judgment. FWIW, I think they are overpaying as well 😉
“Most agents on here don’t seem to have that ability to make a judgment”
How many flames is that from you today? Eight?
(Personally speaking, I’ve noted overpayments many times.)
And “the Flats” was explained, hangemhi. It’s essentially the blocks of Noe Valley along Sanchez and Church running south toward 30th, after they’ve flattened, which is around 25th or so.
A good’s worth is up to the individual buying it. So it’s overpriced to you — big deal. If someone wants to pay that price for it, it is a valid economic transaction at the correct price. But that doesn’t make it “overpriced” from a market standpoint.
Supply, meet demand.
“….They were trying to dupe a buyer into grossly overpaying…”
TMD – As a seller you are entitled to set whatever asking price you want. (It’s your place after all!) Conversely prospective buyers can choose to say thanks but no thanks. (It’s called a free market.)
BTW, I think that the strategy in this instance was poort executed but the seller obviously thought it was worth a shot.
BTW, I think that the strategy in this instance was poort executed but the seller obviously thought it was worth a shot.
Me too. My gut is that if they came out at like 2.575M to start with (like 805 a foot) they would have wound up selling it for at least 2.5 or so. This reads to me like the seller drove the pricing, and not the agent. But I do not know what really transpired.
nnona- my point: those guys made alot of money. How are they stupid? ( others may think so, but that is their perspective.). And, what does this have to do with SF buyers? Sorry but your analogy makes no sense.
I knew that calling SF buyers highly intelligent (as a group) would get those reactions! What Lmrim, you are not as intelligent, but have an understanding of future intrinsic value that most others do not? Okay. So SF buyers are just stubborn (let’s leave IQ put of this). Apparently having witnessed this substancial correction in the market, they are still eagerly putting up their shekels (at least for the sub $1 mil props). You can scream intrinsic value all you want but if the market is not seeing this, what exactly does it mean? And before I get the- you’ll see in a few years, deflation/rampant inflation/dollar crash/japan/realignment/whatever, let me remind you: speculation on your part. God this doomsday scenario is hardwired into some people, and now that we are in a recession all the bears come out of the woodworks big time. It ain’t gonna happen. So we’ll have a moderate recession for a few years, BFD. The perseverance and innovation of humanity will persevere. Shees, how can one go through life waiting for doomsday? What a way to live.
They aren’t stupid, anything but. They made good money in a tough market. IMO they made a lot of money on the buy, and that too is smart.
^ anonn- yep, we’re in agreement. I was responding to a dude/dudette named (at least for the moment) ‘nnona’.
This sale may encourage an investor to buy the extreme fixer just up the street at 369 Duncan. Priced at $825K: http://www.redfin.com/CA/San-Francisco/Undisclosed-address-94131/home/803749
This sale may encourage an investor to buy the extreme fixer just up the street at 369 Duncan. Priced at $825K: http://www.redfin.com/CA/San-Francisco/Undisclosed-address-94131/home/803749
Oops, double-posted and then noticed that 369 Clipper is already contingent. Yikes, that was quick!
those guys made alot of money. How are they stupid? ( others may think so, but that is their perspective.). And, what does this have to do with SF buyers? Sorry but your analogy makes no sense.
My very simple point was this– just because you are “one of the best educated and intelligent (sic) on the planet” doesn’t mean that you make smart decisions, as an individual or, more relevant to your assertion, as a group. Sometimes you can be “best educated and intelligent” and make disastrous decisions, financial and otherwise.
So, to imply (which you do) that a group of the “best educated and intelligent” people on the planet cannot possibly be suckers because they are a group of the “best educated and intelligent” people on the planet is a clear example of faulty “circular reasoning”.
Just take a look at the collective “best educated” credentials of Mr. Madoff’s victims as contemporary evidence that, why yes, one can be part of a group of “best educated” suckers.
[btw, what would be the cutoff for best educated? do you mean Ivies, Stanford, WASP etc.., or top state schools (top UCs, Michigan etc ..), or second to third tier privates (USC, Lafayette etc..) or any 4 year degree period??]
I never called anyone stupid, did I?? I’m sure there were plenty of “masters of the universe” who cut and ran. Collectively, on the other hand, they didn’t prove so smart now, did they? And you were referring to SF buyers collectively, were you not?
^ Your making too much of this (as smart people are wont to do). My point was not that they always make brilliant investment decisions. But rather that they generally are better off financially than the average and therefore have more money to spend. And as I said in my follow up, forget smart, let’s just call them stubborn people with money. Stubborn people with money make a market, in my book.
Assuming they didn’t spend $500 SqFt to build it, this looks like an amazing deal for the Sellers. Having initially over priced so much maybe isn’t so bad. You do a huge price drop and some buyer thinks someone else might snap it up, so they make a move that they would not have had it started lower… just an opinion… we will never know.
But IMO $2.4 is a big number for this home. I saw it and the flow was all wrong. I really, really, really wanted to like it… yet oddly my favorite part of the entire place was the cottage.
There just aren’t many $2.4 million places selling in Noe since Sept ’08, so I think the Sellers made out like bandits to get that kind of number in this market.
Now let’s hope the Buyers stay for 20 years so it isn’t “languishing” in 2 years so LMRiM can gloat 🙂
“Also, Lmrim- you’re falling into circular reasoning. If enough (as you refer to them) suckers are buyin guess what, by definition THEY become the market! And from what I’m seeing, there are alot of people wanting to buy and own in SF. Ironically, the SF buying population is also one of the best educated and intelligent on the planet. At a certain point your arguments are quitoxic in nature, akin to fighting an endless array of windmills :)”
“My point was not that they always make brilliant investment decisions. But rather that they generally are better off financially than the average and therefore have more money to spend. And as I said in my follow up, forget smart, let’s just call them stubborn people with money. Stubborn people with money make a market, in my book.”
——-
If you replace “best educated and intelligent” with “stubborn people with money”, your initial contention makes even less sense, if that’s possible. Are you saying that “stubborn people with money” can’t be suckers?
Instead of clarifying the point you were trying to make, you’ve absolutely muddled it. After asking me various questions and stating that my analogy made no sense, you claim that my answers and clarification were “making too much of it”.
Talk about fighting an endless array of windmills. 🙂
3 times the property taxes for SF/CA and neighborhood gets a beautiful home. There were also many well paid workers that contributed to this project. Talk about creating value. I am saying thanks to the developer and the well to do buyers. I hope they love the place and the hood.
Sorry nnona but you’re all washed up. I simply said that a continous stream of smart stubborn people (sic) with money make the SF market. Them being, or not being suckers is a value judgement (yours). Kapich?
anyone have a clue what the renovation on this place cost — or how to find out? that re-sale price sure seems to blow a whole in the idea that you only recoup a fraction of what you spend.
I almost don’t want to say. A bunch of people who have never done this sort of thing invariably weigh in with agenda based figures. We’ve been down this road many times on this website. But OK. Figure 300 a foot X 3200 feet. Plus 725 purchsae. Plus 200K holding and taxes + 120K brokerage. Subtract it from 2.4M. I ballpark around a 395K profit or so. The ROI will obviously vary greatly if they financed the construction. Construction costs might have been cheaper, maybe as low as 250 a foot, because of materials redundancy and because they seem to have kept much of the initial structure largely intact. I don’t know for sure.
Them being, or not being suckers is a value judgement (yours).
hey what’s up jorge (aka nnona.) and why all the anger? bad day at the office yesterday 🙂
I’m not Jorge. I’m not angry. And… you still haven’t clarified. Have a great weekend!
Just walked by there. It looks like they’re in the process of another renovation. Even a port-a-potty is out in front. I wonder what they’re up to.
“I wonder what they’re up to.”
Learning the hard way.
What’s that supposed to mean, diemos? I don’t think the new owners are hurting real bad if they can afford to buy a 2.4 million dollar home and then immediately do work on it.
Back on the market, this time for $3M.