‘Ultra-Premium’ Condo in the Mission Resells at a $300K LossDecember 10, 2018
Purchased for $1.625 million in mid-2015, the two-bedroom Mission District condo #205 in the “V20” building at 3590 20th Street, at the corner of Valencia, was on the market for $1.549 million last year but failed to find a buyer despite the $76K (4.7 percent) discount.
Having returned to the market listed for $1.395 million this past October, the sale of the “ultra-premium V20 home,” which is “situated at the intersection of the dynamic Mission Dolores and the vibrant Inner Mission,” has now closed escrow with a contact price of $1.32 million, representing total deprecation of 18.8 percent for the 1,112-square-foot unit on an apples-to-apples, versus “median price,” basis over the past three years.
And in terms of the sale obviously representing an anomalous outcome, keep in mind that the penthouse-level unit #504 in the building, which was purchased for $2.595 million in mid-2015, resold for 13.7 percent less ($2.239 million) last year while unit #505, which was also purchased for $2.595 million in mid-2015, resold for 22.9 percent less ($2.0 million) this past May.
Comments from Plugged-In Readers
thats a big loss and obviously not a good sign for that neighborhood. I still think the mission as a neighborhood is way overpriced. People paying those rates 2-3 years ago were nuts. This is still over $1000/sq ft for a less than desirable neighborhood so even to be in line with relative value vs. other neighborhoods, it should come down more
Well this obviously isn’t right bc real estate never goes down in SF, don’t you know that?
Oh but it does…. I bought a nice little unit for under 200K in 2011, that had sold for 500K in 2008. Now it’s worth 700K.
Saying this unit is “situated at the intersection of the dynamic Mission Dolores and the vibrant Inner Mission” is hyperbole. Agree with the poster above that this is a less than desirable area. The person who purchased this place for 1.625 million in 2015 was apparently suffering from irrational exuberance and that usually comes back to bite you as is the case here. This is anomalous insofar as better areas are not seeing this kind of price drop. Yes, condo prices are falling throughout the City but the drops are generally not this step.
I am not a fan of the Mission but you can’t get a better Mission location than this. A couple blocks from Dolores park and some great restaurants and unique stores. There was a great used book store on the corner of Valencia and 20th years ago that I’m sure is closed down by now, but still one of the best locations in the Bay Area for a young person.
DogEared Books is still kicking.
you might indeed be thinking of Modern Times Bookstore, which is indeed missed. It was at 20th and Vanlencia, but moved in 2011 to 24th Street @ Alabama, but never thrived and closed last year.
The first buyers were clearly over optimistic…. but then for some unfathomable reason, the Mission was over hyped then. It’s still a dangerous gang infested dump and Hilary Ronen is determined to keep it that way.
“[…] but then for some unfathomable reason […]”
Unfathomable? It was the product of the largest asset bubble in history. It has been well-documented, in real time, for the last seven years. The causes are many and well-known (among them, historically low interest rates, quantitative easing aka welfare for billionaire bankers, foreign capital flight, Silly Valley VC unicorn fraud, zoning laws enacted to facilitate turning working class homes and PDR spaces into luxury lofts, a dying print media pimping reel estate in a last ditch attempt to stay afloat, et effing al).
Where have you been?
I’ve been avoiding the bullets and knives flying around the Mission. How many murders have been committed within walking distance of this place in just the last year ?
It’s ridiculous to describe this as a bad location. Valencia Street is full of life, Dolores Park is the city’s finest, BART and downtown are very close by, and there are no street encampments in the vicinity.
I’d argue that Golden Gate Park is finer than Dolores, but maybe it’s just me who feels that way
Huntington Park is the most beautiful and underrated park in SF
Dolores park is not in top 10 parks. It’s frankly disgusting most of the time
“full of life” = noisy, smelly and crime-ridden 24/7
“Dolores Park is the city’s finest” = piled with garbage and overrun with tech bros, thugs and pit bulls
“BART and downtown are very close by” = close by poop, needles and screaming crazy people and thugs
“there are no street encampments in the vicinity” = ummmmmm, that’s simply not true
Is “observant neighbor” a realtor?
The talk of a bad location is obviously nonsense to anyone who knows the area. I do wonder why this building in particular has seen such huge drops. Part of it is the market in general, but is there a quality issue lurking?
Au contraire. I know the area all too well. It is not terrible, but certainly not one of the nicer areas of SF. >$100/sq F2F is just insane for this
I agree it is not a bad location if you like an edgier neighborhood, and yes, there are many nice restaurants nearby, but it is most certainly not one of the best locations in the city. It is still much too close to crime, filthy streets, a large concentration of homeless people, etc. And, the condo is nice, but it is still fairly small and constructed in a generic and somewhat life-less aesthetic style. There is nothing that says “luxury” about the place, except for the price.
I think this building and some others like it were marketed towards the young nouveau riche. People who might not have spent enough time in cities to realize that nightlife is something you want to live nearby but not on top of.
IMO these condo buildings and their premium mediocre ground-floor retail (day spas, bank branches, florists, health clinics) made an ugly dent in the old Valencia/Mission. Not much schadenfreude to be had here though, I expect the developer is long gone.
It is not unusual in SF for new condo buildings to suffer price drops in the early resale cycles. Those initial prices were high and the market is adjusting them down. But they will recover because these corner buildings in the low rise, transit/bike/foody/hipster Mission will remain relatively rare compared to those windswept canyons of empty street condo towers in SOMA.
“It is not unusual in SF for new condo buildings to suffer price drops in the early resale cycles.”
That’s factually incorrect, except when the market is in decline.
Wasn’t this V20 building new in 2015? In other words, there is always a big marketing tailwind when the building is new and it’s all being pumped up in unison. It is a location that has a lot to offer for the right person. Some will hardly see all the nasty stuff, and some will fixate.
Keep in mind that a drop in the new condo index was one of the first signs of the market weakening. The salient point about new buildings is not so much the physical newness of the building, but rather that they are sold by full time professionals.
If you had to rank groups by how closely they followed market trends and how quickly they would react (probably also how rational vs emotional their responses were), You would first have people who’s full time job was to price and sell condos, then part time investors, then maybe the types of young professional who often occupy condos and lastly SFH residents who will often be involved in the thick of their careers and families.
And this ordering also corresponds to the order we see some segments go through the RE cycle. First we saw new condo weakness, then the condo market with its higher concentration of investors and younger folks with free time and lastly the SFH market has just started to see inventory pile up and sales drop.
And again, this is no mere SF localized trend. As the WSJ reports, semi-professional flippers have started to curtail their business nationally:
“The pace of real-estate speculation is slowing, a sign of the darkening outlook in the U.S. housing market. Small-time investors who flooded into real estate in the past decade to take advantage of low borrowing costs and rising home values are starting to cut back. The moves indicate that the market’s short-term risk-takers see limited upside—and possible turbulence—ahead.”
““The home flippers are a good barometer of where the market is heading,” said Daren Blomquist, senior vice president at Attom. “They are involved in such high and quick turnover of properties that they are hyper aware of market conditions.””
So many negative opinions about the location from people who admit they never go there. Self-refuting and not to be taken seriously. There are Dutch bicycle shops and Marina float spas there now, it’s really quite sedate.
This is the deal. For $1.65 million, you could buy a small condo on the edge of Cow Hollow, which is a much more established and much nicer neighborhood. Yes, there are nice restaurants and stores near this condo, but it is still very close to a transitional area. Some people are fine with that, and many are not, or at the very least, they expect to pay less for living in such a neigborhood.
Actually, one could buy a decent sized two-bedroom on the edge of Cow Hollow, which sold for $1.6 million in early 2015, for under $1.5 million today.
And, that just proves my point. Either in 2015 or 2018, you could buy in a better neighborhood for the same or less than what this condo in the Mission originally sold for.
neighborhood is utterly unwalkable at night and that kitchen is hideous. it’s new construction but Castro and Chinese can’t be inflowing hard enough to make that area be at the top of anyone’s buying list.
Notice also that with selling costs all of these apples in this building would have nearly or completely wiped out even a 20% down payment.
Lending practices trail the RE cycle, as prices increase defaults and risk (or at least peoples models of risk) decrease. We’ve even gotten back to zero down loans this time around. This makes sense from a narrow minded perspective. With double digit yearly price increases zero down buyers will be “in the black” even including selling costs within about half a year. If people get into personal financial trouble when the are above water they can almost always just sell the house.
But when the environment changes to one where even a 20% down payment can be lost even after a 3-4 year hold, that is a much different world with regards to risk. And it’s only a matter of time before this is reflected in the lending environment.
That building hurts my eyes.
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