Comments on: Palo Alto home price drops 16%.

By: Lionel

Lionel — Sun, 25 May 2008 15:38:43 +0000

Good point, Pralay. Whatever the buyer paid, he probably didn’t get this message from Warren Buffet: “The recession will be deeper and last longer than most people think.” As snarky as many of my comments are, messages like this scare me. My job’s pretty secure, but I have so many friends who will be impacted by the upcoming slowdown. Housing prices will be the last thing people worry about a couple of years from now.

By: Pralay

Pralay — Sun, 25 May 2008 07:52:28 +0000

Smart to get out when he did.
———-

How many high-end homes in PA sold over or on listed price in recent months? Considering the fact this home was on market over 175 days and the last price reduction was done about 2.5 months back (March 04), I have no reason to assume that suddenly a buyer appeared in market and made an offer with listed price.

By: Lionel

Lionel — Sat, 24 May 2008 22:11:42 +0000

Smart to get out when he did. However, the new owner is about to lose a couple mill in equity in a year. Money and brains don’t always go together.

By: Real Estater

Real Estater — Sat, 24 May 2008 16:25:39 +0000

This house is SOLD! The owner doubled his money in 5 years, ahead of schedule. The “price reduction” strategy works magic again!

By: DreamT

DreamT — Sat, 24 May 2008 05:40:38 +0000

To burbed’s question… “What should we as Bay Area citizens do to him/her?”
I think most of us burbed dwellers are denizens rather than citizens…
The concept of fiscal terrorism as a crime sounds oddly appealing though. I vote that after two unsuccessful 15% decreases, the seller loses his/her turn and goes straight to jail without collecting $200.

By: Renter4

Renter4 — Sat, 24 May 2008 05:35:19 +0000

I don’t know if I’d spend in the millions for any house that didn’t come with a bunch of land. But I’d really prefer to live in walkable suburbs with a Safeway, a library, and yes, a Starbucks, than some estate town with no sidewalks…

By: Herve

Herve — Sat, 24 May 2008 05:16:56 +0000

If I had that amount of money, I would rather buy the one in Portola Valley (5070 Alpine Rd): 7,800 sq ft on 8.5 acres (for $8.4M)

http://tours.tourfactory.com/tours/tour.asp?t=403696&sreferer=www.burbed.com

Real Estater is right though: the marketing strategy for these houses is different. One thing that’s a bit strange on that Palo Alto house is that they lowered the price pretty quickly. This house is not unique enough to justify such a high price anyway.

The house in Portola Valley on the other hand has been on the market for a very long time, but I can imagine someone just buying it at that price because there is simply no other house like it.

By: Tom

Tom — Sat, 24 May 2008 04:45:38 +0000

The Zillow estimate is only $4,740,000, although the county assessed value is $5,510,364.

Every time it shaves off $1M, Santa Clara County cries. That’s about $11,000 less in property tax revenue when it sells. If they get the asking price, the annual tax bill on that place will be about $115,000.

Last year, the current owners paid $61,346 in property taxes- although in many other states with a 4% tax rate, a $5M place would run about $200000 a year.

Prop 13: “Keeping house prices artificially high since 1978″.

By: madhaus

madhaus — Sat, 24 May 2008 00:34:49 +0000

Yeah, I sent this one in a while ago, and I also sent burbed the Google Streetview coordinates proving where it really was.

?er, the Real Bay Area not only doesn’t include the East Bay, it also doesn’t include much of anywhere on the Peninsula either. If the prices are dropping, then the RBA tag you’re stopping.

By: San Mateo Home Sellers in Trouble

San Mateo Home Sellers in Trouble — Fri, 23 May 2008 21:14:22 +0000

Cool, I just posted a bunch of these million dollar price drops in San Mateo last night. Check it out: Homes with Million Dollar Price Reductions

By: RealEstater

RealEstater — Fri, 23 May 2008 21:00:28 +0000

With the scarcity of land in the real Bay Area, you want to build as large a home as allowed by the local zoning law, including a full basement if possible. For every square foot that you don’t build, you are short-changed by $1000.

By: RealEstater

RealEstater — Fri, 23 May 2008 21:00:11 +0000

With the scarcity of land in the real Bay Area, you want to build a large a home as allowed by the local zoning law, including a full basement if possible. For every square foot that you don’t build, you are short-changed by $1000.

By: ?er

?er — Fri, 23 May 2008 20:37:34 +0000

wow. just found this site. very interesting. i especially enjoy the concept of a “real bay area” that doesnt include the east bay. what a load of crap!

and yes these luxury homes are losing value – they were overpriced to begin. energy and other concerns are hopefully making people think on a smaller, less obnoxious scale.

By: been_there_done_that

been_there_done_that — Fri, 23 May 2008 20:07:42 +0000

Jimmy_noh I would love to see you back up those facts you posted about Palo Alto. Also, FYI, you can have an earthquake anywhere anytime, so I am not sure why you added that to your post? I would rather experience an earthquake in Palo Alto than a lot of other places which are not prepared for earthquakes and therefore have less stringent building codes.

I’m not sure that this 16% price drop on this particular house means that the high end market is currently in trouble. I’ll wait until inventory grows and we see prices drops across the board. I think the Palo Alto market will be effected, however, I am not sure that it is happening right now. I think we will have a better feel for what is to come in the high end “RBA” market after summer. heading into fall.

By: Real Estater

Real Estater — Fri, 23 May 2008 19:37:33 +0000

buckborden,

This is the USA, not Cuba.

By: buckborden

buckborden — Fri, 23 May 2008 18:33:46 +0000

This is feudal baron stuff! How dare anyone believe he/she is entitled to such extravagance! These people need to sell and sell now and donate ALL their profit to Gov. Schnitzelnegger to help solve this state’s budget crisis. Then the state can turn this palace of pomposity into a museum dedicated to all the gamblers subsidizing The Governator’s fiscal imprudence. Arnold LOVES gamblers (and apparently so do Californians).

By: eichler

eichler — Fri, 23 May 2008 18:32:59 +0000

When I am super rich, I am buying up most of EPA. I am then going to tear it all down, build luxery condos, rename it Palo Alto Shores, and go from super rich to super obscenely rich.

By: sonarrat

sonarrat — Fri, 23 May 2008 18:13:54 +0000

This is nowhere any near any kind of a busy street, but when you have three-quarters of an acre, does it matter? If I ever get super rich I’d like to buy a large section 8 apartment complex on Middlefield Road in Redwood City, evict all the tenants, tear it down, and build a huge mansion in its place. So there, renters!

By: rick

rick — Fri, 23 May 2008 17:35:19 +0000

So what, this must be selling for 8 million in ‘99. Didn’t Stevo show us the graph of the high end bombed in 01-02?

By: Jimmy Noh

Jimmy Noh — Fri, 23 May 2008 17:26:11 +0000

5 million 5 years ago is right. The crazy thing abou t these realtors who are still telling us that the market remains strong in Palo Alto, is that they think we havent read the foreclosure notices which are creeping over 101 from East Palo Alto, and now settling into blue ribbon Palo Alto, that we havent read how its not just a credit crunch but a venture capital crunch which comes from reduces IPO’s and the general poor performance of the investments into which VC firms had their equity.
Palo Alto is still a vastly over inflated suburb with schools that are good by national standards but poor by international standards, sits in an earthquake zone, in a country with a poor economic future, and the highest hospitalization for asthma in the country!

And you want to pay a lot of money for a plasterboard clad house next to a busy street!