Three Points for a Coveted Two-Bedroom With Views
August 31, 2020
Having hit the market priced at $1.95 million in March, a price which was subsequently reduced to $1.835 million in May, the sale of the “coveted” south-east corner unit #1902 in the One Rincon Hill tower at 425 First Street, a 1,309-square-foot unit with “commanding Bay Bridge and water views,” has just closed escrow with a contract price of $1.79 million or roughly $1,367 per square foot.
And yes, that’s 30.2 percent above the $1.375 million price the unit fetched in April of 2013, at least on a straight-line basis.
But having been listed for $2.15 million in December of 2015, the 425 1st Street #1902 was marked-to-market and traded for $2.19 million in March of 2016 as well, representing an 18.3 percent drop in value for the view condo from the first quarter of 2016 to today on an apples-to-apples basis (having jumped 59.3 percent from early 2013 though the end of 2015 in the post-recession boom).
Comments from Plugged-In Readers
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One Rincon Hills Condominium is now under building litigation. The value of all of the units in this condo building are encumbered by the litigation – which should be settled within 6-12 months. I wouldn’t consider it an apples-to-apples comparison given that the last time the unit traded on the market – there was no pending litigation.
While a valid point, and the cloud of litigation can impact one’s ability to refinance or secure a purchase loan, keep in mind that construction defect suits are fairly common; the suit is close to being settled; and the settlement should ultimately benefit the homeowners association (which filed the suit).
30 percent above the 2013 purchase price is nothing compared to what investing in the S&P 500 would have generated.