Purchased for $950,000 in June of 2015, the modern two-bedroom unit #411 at 1875 Mission Street (aka “M@1875”) returned to the market listed for $1,050,000 this past August, a sale at which would have represented total appreciation of 10.5 percent for the “luxurious, stylish and modern top floor [Mission District] condo,” with “the finest” floor plan in the building and a compact parking space in its garage, since the second quarter of 2015.
Reduced to $1,025,000 after 10 days on the market, the asking price for the 778-square-foot unit was dropped to $999,999 in mid-September, to $949,999 at the end of September, to $939,999 in early October, to $900,000 in mid-October, to $875,000 at the end of October and to $850,000 last month.
Yesterday, the list price for 1875 Mission Street #411 was reduced to $825,000, a sale at which would now represent total depreciation of 13.2 percent for the unit on an apples-to-apples, versus “median price,” basis since the middle of 2015, not accounting for the value of all the furnishings which are now included in the sale as well.
Last year, the one-bedroom unit #211 at 1875 Mission Street resold for $832,020, representing total appreciation of 7.4 percent for the unit from 2015 to 2017. But as we noted at the time, “while a straight line from early 2015 to today would show “continued” appreciation over the past thirty months, a curve would reveal a front-ended up and more recent down,” which brings us to today.
And yes, this is the boutique building with a heated rooftop pool and adjacent lounge.
A tunnel like cave on a grungy block. No thanks, regardless of the pool amenity.
Perhaps that’s why the unit only fetched $950,000, and established a comp at $1,221 per square foot, back in 2015.
From the pictures, all of the rooms look claustrophobic. If this is the ‘finest floor plan’ I’d hate to see the others. At this size this should have been a one bedroom unit.
Old industrial buildings used to carved into larger lofts with more windows. but with the high per sq. ft. prices of today, they cut up into small narrow “hallways” with one little window at the end. I would never want to live in such a place.
This really should be a one bedroom with the front bedroom removed to make a larger living area. As it is now, it feels claustrophobic as hell and I am sure prospective buyers feel the same way, hence the precipitous price drop. Also, AWFUL block. No thanks.
Once again, perhaps that’s why the unit only fetched $950,000, and established a comp at $1,221 per square foot, back in 2015.
This is just an awful unit. Should never have gone for that kind of money in the first place.
Terrible. The living room looks like its barely 7′-0″ wide. I’d love to see a floor plan. Any clue on what the HOA dues are?
HOA fees for #411 is $498 according to Realtor.com (link from above).
Is that really all there is to the “living room”? It looks like a partition on one side, maybe creating the second bedroom?
Say this closes at $825K. 20% ($165K down) at 4.625% jumbo rate. Mortgage is $3393. Call insurance $50/m. HOA says it is $498/m. Prop Tax I calculated as around $804/m. That’s $4745/m total out of pocket per month for a place that I’d definitely feel claustrophobic in.
Meanwhile, I see this loft rental a few blocks away (arguably a better location close to Valencia/17th) that is 130 sq ft larger, double height ceilings, and with 2 car parking and only $3380? This alternative loft may be an anomaly in price, but dare say you can easily find a much larger/nicer/location place for $4745/month and do something w/ that $165K down.
Can’t imagine there’s a big buyer market that is still betting on near term appreciation to justify the premium. That makes this one expensive pool!
Given the price point, I suspect that’s not a one year lease but rather a tenant looking to move out short of a one-year lease. My guess is he/she has two-three months left, and its hard to rent in December. That place should rent close to $4k.
Also, your math doesn’t account for the mortgage interest deduction for up to 750k loan amount for a married couple, and the local and state tax deduction for the property tax, which while not as lucrative as before, still remains lucrative.
Also, you don’t need 20% down for this house. There are lots of loans out there for 10% down at the same or marginally higher interest rates.
All in all, a buyer who intends to live here for at least a couple of years, and keep the property as a rental unit thereafter, will probably come out on par or better than a renter.
At the same time, if the unit sells for $825,000, the effective cost of ownership will have been around $9K per month over the past three years, not accounting for the value of any deductions, the furnishings, or the opportunity cost of not having invested any downpayment in another asset class, such as equities, from 2015 to today.
Agreed. I was commenting on the prospects for a future buyer of the property, assuming prices have somewhat stabilized and don’t fall further. The current owner clearly paid too much.
There is NO deduction for property tax. For anyone who will qualify for this mortgage, your state and local income taxes eat up the entirety of the 10K you can deduct.
The interest deduction also means you lose the standard deduction, which will mean the first 300K is not saving you anything. You only deduct the part between 300K and 750K, and thus the mortgage interest is only about half deductible, against a 24% tax bracket at this price point, so you’d save only about 12% of $3393, about $375. Now add 2.5% on a $165,000 Tbill you’ll be losing for the down payment and that’s $343, so his numbers weren’t too far off.
You’d be out of pocket about $4700/mo, well above the rental price, which I’d estimate at something closer to $3300. I’d not be surprised if this sells south of $750K.
I did not appreciate the standard deduction part, thank you, and was disappointed to learn the SALT deduction is 10k for individuals and married couples. It does not pay to be married.
I saw units in this building when it was new, really didn’t like it. As many commenters are seeing in the photos, the units are VERY cramped and have a weird thin layout. Furthermore, the ‘bedrooms’ in many of the floorplans are only separated by frosted glass partitions/doors, not real walls. I can see why 1bds may do better in this building, because the 2bds I saw didn’t give any real separation or privacy.
It has become downright COMICAL how people blame these losses on various design features. There must be some secret law of real estate where bad design features are only noticed the second time a unit sells, but never the first time.
We’re not blaming the decline in sales price on the design features, we’re just commenting on them.
We’re blaming the decline in price on a poor buying decision by the current owner. Or at least I am.
While the likely loss can certainly be ascribed to a poor buying decision by the current owner, the actual decline in price/value is being driven by the market.
I didn’t mean to imply that the market isn’t going down (it is). Just commenting that this building sucks (it does).
terrible location. the mission prices were so inflated in 2015-2016, and still so despite these drops. people went nuts for crappy condos in crappy but trendy neighbrohood
Yeah the Mission was hyped big back then. Lots of articles about how the tech money makers were ignoring the Marina and Pacific Heights in favor of the Mission.
Agreed. In hindsight I would have unloaded my Mission rental property then too.
UPDATE: Down in the Inner Mission