One Year Later and worth $175,000 Less in the Mission
February 2, 2016
Purchased as a remodeled “grand-scale Italianate Victorian flat located at the intersection of the best part of the Mission and Eureka & Noe Valley neighborhoods” for $1.450 million in March 2015, the 1,440-square-foot condo at 979 Guerrero Street returned to the market this past November listed for $1.495 million.
The asking price was reduced to $1.375 million in December. And on Friday, the sale of 979 Guerrero closed escrow with a reported contract priced of $1.275 million, down $175,000 (12 percent) over the past year.
While the sale in early 2015 explicitly included a year of nearby leased parking worth $3,120, the marketing materials for the sale last week touted parking off-site with “a seller paid lease or Uber rides up to $4,000 for the 1st year,” so we’ll call it apples-to-apples despite the potential for an additional $880 in value.
And yes, the unit had been listed for $979,000, or roughly $680 per square foot, and sold for “Over Asking!” at $1,007 per square foot with eight offers in 2015.
Comments from Plugged-In Readers
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It appears that the flat directly upstairs from this one sold off market in December for $2.0m. The top-floor unit has parking and a roof deck, but this observer predicts a loss of more than 12% if it sells again within a year…
Not sure there will be a 12% drop this year. Jury is out but I’d bet a 5% plus drop in prices.
Just saw a RE blurb for my neighborhood and it sold for under asking. This is the first time I’ve noticed that happening in this area in a while.
Of course, as a pure financial transaction, the loss is far greater than 12% once one includes buying costs, selling costs and transfer taxes. Probably closer to 20% – $275,000+. And that “investment” loss cannot be used to offset any capital gains, unlike other investment losses.
Other costs as well – property taxes, financing, insurance, HOA (some of these would be tax deductible). This was a very expensive $30,000/month “rental.” Be careful out there, prospective buyers.
Can you link to a study showing results for sales within under one year please, JR Bob Dobbs?
“a study showing results for sales within under one year” – Sorry, but I can’t tell what that means.
You could try using Google to search for whatever study you have in mind.
Was that difficult to understand? Now that I’m reading it was bit awkwardly worded. What I meant was, is there anything showing typical results for people who sell a property if they bought it less than one year ago? Hah. I guess that’s what Case Shiller is, come to think of it. Although twice in 10 months seems an extreme version of an apples to apples sale. Anyway, wouldn’t you say, “beware prospective sellers” is more fitting?
I don’t think that Case Shiller just measures propertied that have been sold within a year of purchase.
And I also don’t see what this study would be looking at.
The fact that fixed buying and selling costs amortized over a smaller time period produce a larger drag on financial returns is just math. No study needed.
Or are you asking if there’s a correlation between property price changes and length of the prior ownership?
That’s actually an interesting question. Is there a quantifiable “spook factor” if an expensive property returns to the market less than a year after sale? Would a certain % of potential buyers be immediately turned off due to assumptions about some issue with the property or neighbors?
It probably doesn’t matter in the wash of other market drivers, but still interesting to ponder.
“I don’t think that Case Shiller just measures propertied that have been sold within a year of purchase.”
no it doesn’t. but it will also have such properties. anyway …
Nice unit.
It’s a typical Victorian/Edwardian floor plan that does not lend itself very well to contemporary living. I’d use the rear bedroom as the dining room, thus leaving one small bedroom, or having to use one of the parlors as a bedroom. I live in a similar floor plan now, and do not like it very well.
You’re right that it’s typical, and clearly the “bedroom” in back was originally the dining room. The typical renovation of these type of flats would unite the kitchen and dining room space into one kitchen/sitting/dining room. But this one has a decent size bump out for an eat in kitchen (“mud room”…how east coast!). I think it’s reasonably functional as is, though Victorians always have these awkward issues of too many “public” rooms and not enough bedrooms.
I think it’s okay as is. Not ideal by modern standards, but it has a lot of charm.
Look closely at the first picture and they do have the second parlor set up as a bedroom, adhering to standard rental flat conventions.
The $1.45M price paid in March 2015 is probably over the market. And only after 7 months, the owner sells again in the slow winter season. Not sure if there is any distress or some special situation, the sold price of $1.275M appears under market price. Short term trading of houses is a sure way to lose money.
That’s not Noe Valley. Or Eureka Valley.
The rugs, the dark paint, the K, all kind of awful actually. I would pass on it.
You know you can change the paint and rugs if you like it otherwise, don’t you?
Of note: the unit had parking when it was purchased in March 2015 by the owners of the upstairs unit, who transferred this unit’s parking to the upstairs, bought another house in the meantime, and sold both units, this one now without parking.
If accurate, that would explain most, if not all, of the difference in value. That being said, according to the listing for the lower unit in 2015, it did not have a deeded parking space to transfer (the space listed with the unit was leased in another building).
The Redfin notes from 2015 specifically call out that the unit had no parking:
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“Condo located on the edge of Eureka Valley/Noe Valley. Kitchen and bathrooms are a mix of modern updates and original finishes/details. Unit has a nice deck area, but no parking. Back, “master” bedroom has attached bath and walk-in closet, but is staged as a living room.”
“Miriam Westberg
Redfin Agent – San Francisco
10 Months Ago”