As a reader noted six weeks ago:
Speaking of Apples: 893 Elizabeth is on the market at $1.6M and looks largely unchanged from its 2006 state. Maybe a new bath and the kitchen had some light updates…But looks like less than 75K.
Purchased for $1,350,000 in August 2006, yesterday the list price for 893 Elizabeth was reduced for the second time, now asking $1,424,000 (74K more than 2006).
∙ Listing: 893 Elizabeth (4/3) 2,500 sqft – $1,424,000 [MLS]
∙ The Cost Coming Down? [SocketSite]
∙ Our Point Exactly [SocketSite]
I like this place.
seems very livable and relatively central to the city, although I’m not sure how far of a walk it is to things.
Too much marble in the bathrooms for me, but the house seems turn key and overall seems like it has good amount of space too. (has a LR and also DR and also den as well as a breakfast nook as example).
by the pictures the floorplan also seems to make sense.
What would the rent be for a place like this?
4-5K?
Wow, they are partying like it’s 2006! improvements look minimal, and we expect they will be lucky to sell for 2006 price, probably a little under.
Another interesting Apple on the tree is at 1632 Dolores:
Noe 3/2 on Dolores
Sold for $1,130,000 in 3/2007 on the market for $1,149,000 today.
Not a perfect apple because it includes approved plans for an expansion.
Online DBI checker shows no permits except for the approved plans and it appears that no work has been done on it.
I think the summer of Noe in 2006 and 2007 were about equal, I don’t think there was one “peak” though some of the 2007 sales were kind of nutty, the whole market wasn’t like that.
893 Elizabeth is a nice place though still a bit up the hill for me, this is a nice block. I think it would rent for $5-6. At $569/sq foot I think it is priced about right for this market and should move pretty quickly here.
That’s a good block. There haven’t been many sales on it at all in the last seven or eight years. This particular house has a ~2100 foot lot while most of its neighbors have ~2850 foot lots. That’s why it’s priced as low as it is. Yes it was the same in 2006. No, I don’t think somebody starting with a really high list price for an unimproved property is all that interesting. People are people. They like money.
The upstairs floors in this place are visibly slanted when you see it in person, which makes me think there might be some issues with settling of the structure and probably some other deferred maintenance issues. It isn’t nearly the worst that I have seen, but it definitely seems like something that shouldn’t be going on in a 1.424m dollar house. Does anyone have any experience with the cost in San Francisco to re-level floors assuming that there are no major structural issues?
I might be wrong on my calculations… but even if this rents for 6k, you’re still losing money on this as a rental at this price, even with the absurdly low interest rates. Either rents need to go up, or houses in this area still have a ways to come down.
^ anon…you’re never going to justify a SFR purchase for it’s rental value. The rent v. buy comparison is always a good one to make, but (in SF anyway)there seem to be intangibles that keep a substantial ownership premium going. If it ever drops to parity I’ll be flabbergasted.
This place is about as bland as you can make one of these houses. Love the birthing shed, though!
ex-SF-er: It’s a driver’s house for sure. It’s a long walk down to 24th and quite the uphill walk to Mollie Stone’s and the whole top o’ Portola scene. Firefly is a block away, which is nice.
The issue of “re-leveling floors” is a good point, but very complicated and expensive.
You can’t really level floors without doing complete new reinforced concrete foundations and then leveling and jacking up the house at that time. You essentially have to remove all of the lath and plaster then as well, in order to make floors and walls true and level. Expensive but doable.
Again, one of my main complaints when realtors advertise a place. They play up the colors, the “glossiness” the remodeled kitchens and baths, and don’t address whether the house has new foundations or not. If the fancy kitchen sits on a brick foundation, you are wasting your money on paying the selling price.
Existing brick or even un-reinforced old concrete foundations are more important than a new kitchen.
“…and don’t address whether the house has new foundations or not.”
My guess is that most retail buyers care more about superficial appearance and either don’t care or don’t understand the issues regarding the quality of the bones.
Which would explain why all quickflips are 100% superficial upgrades.
“Long walk to 24th”?!!!
It’s one block to 24th and Douglass and four blacks to 24th and Castro! Geeze.
Oh I agree completely Milkshake. I suppose knowing this information would enable more buyers to negotiate a better selling price with regards to good solid “bones” (foundations) or not.
let’s ask an active broker how many buyers engage the services of an inspector before making a purchase. i’m guessing its more than you folks imagine.
“let’s ask an active broker how many buyers engage the services of an inspector before making a purchase.”
What I don’t understand are the people who depend on the seller’s disclosures and inspection instead of conducting their own inspection because they are convinced that California’s disclosure laws are sufficient to compensate for this. Getting an inspection is routine in other states (except perhaps during the boom), but seems slightly less common here.
I was told by my agent on many bid opportunities that any bid that contained an inspection contingency would be tossed in the trash.
I’m sure things have improved during the bust though I’m equally sure that a large number of lemons were sold at peach prices during the boom because if this buyer’s handicap.
I have sold a bunch of houses and the buyer has used their own inspector every single time. Those sales include 2004-2008.
sparky-b – I’m sure you had no reason to fear that a third party inspector would find any flaw 🙂
I wasn’t bidding on new builds or complete remodels but rather older homes that had minimal or incremental remods. Though I’m not a construction professional I did notice what looked like serious problems in some of those houses that forbade inspection contingencies. In most of those cases finding the flaws required getting dirty and using a flashlight, something which many buyers probably wouldn’t attempt.
Of course a buyer could always arrange a pre-bid professional inspection though that would be an additional challenge in the old days of two weeks between the first open house and final bids.
mod,
“Though I’m not a construction professional I did notice what looked like serious problems in some of those houses that forbade inspection contingencies. ”
how do you mean “forbade”?
“Of course a buyer could always arrange a pre-bid professional inspection though that would be an additional challenge in the old days of two weeks between the first open house and final bids.”
its not that hard to get done. it does not take too long to inspect or report.
i’ve had the same experience as sparky. there was always an inspection. the bank requires at least a pest report. and walking away from a no contingency escrow is a piece of cake for a buyer.
fair enough MoD, I wasn’t hiding anything so I didn’t ever consider “no inspection” a benefit, but still I don’t think it was ever offered up as an incentive (but maybe for the same reason, I was always selling done with permits anyway).
anonee – I meant that my agent strongly discouraged a bid with an inspection contingency. And yes getting a pre-bid inspection is not that hard so long as you’re willing to take any inspector. But if you have a preferred and trusted inspector then coordinating schedules can be tricky. All that expense and effort knowing that your bid might not even win.
And I’m sure you realize that the scope of a pest inspection is very limited and inadequate to completely evaluate a property.
Can you explain how a buyer can easily walk away from a no contingency escrow without losing their earnest money ?
sparky-b : just to be clear I wasn’t implying that you were hiding anything but rather assuming your product to be clean and able to pass any inspection.
I didn’t think you were.
I echo MoD’s comments here, in 2000-2001 we were bidding on properties in Rockridge and our agent strongly discouraged us from putting in an inspection contingency on our bid. She said that presenting an offer with no contingencies was always best.
A group of us bid on a multi-unit building in Temescal and we got rejected even though the agent implied that we were the highest bidder, I don’t know exactly why but I think it had something to do with our finance contingency.
I never listened to such advice and always wrote offers with inspection and finance contingencies. We eventually got a place in a location I prefer better anyway, so it worked out for the best.
“I never listened to such advice”
Good for you, because it was crap advice. Losing a crappy house to a higher bidder is no great loss, except to the realtor who wants the fees.
mod,
not to put too fine a point on it but..
“And I’m sure you realize that the scope of a pest inspection is very limited and inadequate to completely evaluate a property.”
having accompanied stan from markoff under and around many a property i can tell you that the pest inspection will uncover the most salient
features.
imo, too many people get hung up on checking out the condition of the water heater or furnace. the far more important decisions involve the light and air, the location, the adjacency…
and for the $/sq.ft of sfre one should focus on $$issues rather than cents issues.
this is the main reason why some overpay and some do not.
the broker’s are correct when they say that you should forego contingencies in a seller’s market;
put yourself in the seller’s shoes to figure this one out. do your homework, know what you are looking for and then be ready to pounce. as we all know, the good stuff goes fast.
“Can you explain how a buyer can easily walk away from a no contingency escrow without losing their earnest money ?”
i have been on both sides of this issue more than once; the bottom line is that unless one can prove that some damage was done there is no basis or real precedent for seizing earnest money. the brokers (and their managers) on both sides recognize this. hard to believe but ask around and you’ll see.
Have you seen the house to the right? It’s a monstrosity that was last updated in the 60’s. If you think the front of that house is scary than may I suggest that you don’t look at the back — from office you can see a Soviet styled apartment building.
sfr,
“Good for you, because it was crap advice.”
no contingencies does not mean you do no inspections on the house-it just means that you are telling the seller you want the house regardless of whether it appraises or despite what some inspector may find. as this tends to put the seller in a warm place it works very well in getting your offer accepted over ‘less clean’ offers. crap advice? i think not.
“…the bottom line is that unless one can prove that some damage was done there is no basis or real precedent for seizing earnest money…”
thanks anonee. So it comes down to whether the non-contingent buyer is willing petition escrow for a return of the earnest money and to risk being sued by the seller. It seems to be that it would be easy for the seller to claim damages on their carrying costs during the life of that failed contract. But maybe that isn’t enough to make a court case worthwhile. The actual damage of being out of a declining market for a month might be greater though I can see how those damages would be difficult to prove.
As for inspections, I agree that focusing on the health of easily replaced appliances is wasted effort. What concerns me more are problems with the foundation and systems like electrical and plumbing, all of which can require repairs going into five digits. I haven’t seen a Markoff report that covered those areas. Do they go beyond pest inspections now ?
mod,
pest will cover issues like water damage and leaking. electrical issues are typically limited to capacity and grounding and not usually difficult to diagnose. even tho both have the potential to require five figure upgrades these issues are still relatively small potatoes when you consider total costs of sfre. a roof replacement is probably a bigger issue and its easy to get a quick and free inspection/quote on that.
Somehow I missed this thread that linked back to my original comment back in 09/10. The price has just been adjusted down to $1.375. This is a great apple. Can’t wait to see where it closes. I have to admit that I thought it would move a little quicker. It’s a nice home.
893 Elizabeth just cut to $1.325. Quite a ways down from where they hoped to sell – first listed at 1.6 six months ago.
This place doesn’t seem to be as dumb a purchase as most 2006 vintage buys, so they’ll probably only lose $100-150k over the 5 year hold, which is really not much money. Plus of course whatever they spent on the light renovations (in an earlier thread, a poster estimated no more than $75k in reno costs).