Location, Loocation, Looocation – Part II
In a previous post, I asked whether location was all there was to pricing real estate. Looking at several homes on the same street, their position, and their list prices would help answer this question. The first home was a small 2/1 in a “fantastic location” for just under a million. Let’s see what’s on the same street but on the Other Side of that cruel boundary between sort of good and Real Good: Middlefield Road.
365 Lincoln Ave Palo Alto, CA 94301
$7,995,000
Beds: 8
Baths: 4.5
Sq. Ft.: 5,505
$/Sq. Ft.:$1,452
Lot Size: 0.72 Acres
Property Type: Detached Single Family
Stories: 3
View: Neighborhood
Year Built: 1907
Community: Professorville
County: Santa Clara
MLS#: 81024865
Source: MLSListings
Status: Pending Without Release This listing is in escrow, past inspections and waiting for loan funding. "Without Release" indicates that the current buyer doesn’t need to sell a home to buy the new home.
On Redfin: 62 daysSpecial Opportunity to own one of Professorville’s largest lots & historic homes. Built in 1903 by Stanford Professor Leander Hoskins, this graceful craftsman style home is 5,511 sq ft & has 8 bedroooms & 4 bathroooms on a 31,500 sq ft lot. Fine example original craftsman woodwork. A broad inviting veranda welcomes visitors. Walk to Downtown & Stanford University. Please do not disturb occupants
That photo looks a bit… threatening. Lights are on but it’s still daytime… but not for long! The house seems like it’s crouching down low, preparing to spring onto your chest, knock you down, rip out your throat and force you to sign an eight million dollar real estate offer without contingencies. And no eights in the price, yet! But it’s a “Special Opportunity.” It’s so special, the “bedroooms” and “bathroooms” are pre-stocked with extra haunting ooos.
It’s sooo special, that you’d better be able to handle the cognitive dissonance of a “broad inviting veranda” that “welcomes visitors,” except you’re not supposed to “disturb the occupants.” Guess that broad inviting veranda is off-limits, eh? But ask yourself, what kind of occupants would there be in an 8/4.5 near a major university?
Two words. Frat house. With extra ooos. Take a look at the photo above, again. Are you thinking what I’m thinking?
Vampire frat house.
While you put on your carbon-fiber neck protector, savor this lot. Look how it takes up the space of more than four tall or two grande properties, and just lolls onto both Lincoln and Waverly like a well-played Tetris piece… without actually being on the corner!
Heh. I said loll. And lolling is what you get to do when you live on the Better Side of Middlefield. Too bad you can’t buy the Vampire Frat House, though. It’s pending, and loooks like it was delisted a month ago, probably when someone walked in and said “Ooo! 8 bedroooms and 4 bathroooms! Sooold!” Loooks like you’re priced out forever, but the ooout-of-tooown sellers are making the city very happy. The old tax valuation was (ooo!) $175,246.
To be fair, I went up and down the street loooking for unsightly vehicles, but this was the worst to be found. The next worst was the Post Office truck. But I do like how this photo shows the hired help gazing longingly at a house he wishes he could live in.
You see, this is the Better Side (even if you have to leave garlic on each windowsill)! The neighbors keep their cars tucked behind hedges and trees, so only the transient workers’ jalopies remain. Next time, we’ll Return to the Dark Side. Be there or be a Tetris piece!
July 27th, 2010 at 8:07 am
You mean the same looocation as this house?
July 27th, 2010 at 8:26 am
Nice house! Big win for Paloo Altoo with the new property tax!
July 27th, 2010 at 8:37 am
You get a lot of house and land for the money with this property. Here’s its sister property in the vicinity:
http://www.mlslistings.com/601-MELVILLE-AV-Palo-Alto-CA~i19$984725$RES
July 27th, 2010 at 8:59 am
“wholesome California Arts & Crafts’ ideals of simplicity, artistry, & a life in closer harmony with nature.” I guess that means no air conditioning.
July 27th, 2010 at 9:18 am
I guess that means no air conditioning.
Probably no insulation either.
Zoning: R192. Could that mean it’s a historic house with special tax rates? There are some houses around here that you have to maintain the historic integrity of the exterior and in return, you get REALLY low property taxes.
July 27th, 2010 at 9:32 am
It’s a beautiful house. Needs a little work. It isn’t on the corner because years ago they sold off the servants’ quarters–at least that’s what I’ve heard.
The big property tax boost should save Palo Alto Schools for another year.
July 27th, 2010 at 5:37 pm
I’d love to have a little of whatever the person who buys this is smokin’. $8 million for this? Yeah- its in Palo Alto and all, but seriously?
July 27th, 2010 at 10:49 pm
Looks like Real Estater listed his home for sale. Last month he gave us some “solid hints” (and more solid hints and more more hints) about his home. Now, look at this listing. It is wrong side of Middlefield. The description in listing:
2007 sale price: $1.7M
Listed now: $1.35M
I agree that nobody would pay him $2M for this.
July 28th, 2010 at 12:23 am
> Now, look at this listing.
Right next to the house I toured a few weeks ago. Neighbourhood is alright. This one on Fulton is kind of weird. I’ll go check it out this week-end if it’s open.
July 28th, 2010 at 7:47 am
“2007 sale price: $1.7M
Listed now: $1.35M”
Sounds as if it might be a genuine RBA home. I’m thinking buy now and sell in seven years. Alternatively, 10 years ago this place must have been worth about $675k.
Let’s see–since it’s a real RBA home, it’ll be worth a minimum of $3.4M in 2017. Assuming a final sale price of $1.35M, no sales commissions, and so on, the incentive to hold for seven years is $2.05M [$3.4M-1.35M].
I wonder why the owner is passing the opportunity to take a $1.35M asset and turn it into a $3.4M asset. Sure he might have to change a couple light bulbs, and who knows, he might have to buy a bottle of drain cleaner, but for over $2M?
Buying this $1.35M home should be viewed as a great opportunity for the buyer, right?
Let’s ignore the $350k that the current owner is losing–that an aberration on how the price doubling works, right? If Real Estater doesn’t live here, I suspect he will be buying this great opportunity!
I suspect, however, that given the $2.05M that can be realized in seven years, someone will be willing to pay more than $1.35M for this place. What’s that about buying instant equity?
July 28th, 2010 at 11:26 am
Regarding the house on Fulton; that is no way to flip a house. They’ve been there three years and haven’t ripped down that horrible wallpaper? It’s been on & off the market for 18 months – time to stage it!
July 28th, 2010 at 11:43 am
Nomadic@11
Current owners have only owned for a couple of weeks. It was seized in foreclosure not too long ago.
Plus there are two other similar houses for sale on the same block. Plus the house from burbed earlier (linked below) is just down the street–this block is what happens when you are one block the wrong side of middlefield–no RBA for you!
http://www.burbed.com/2010/04/30/excellent-investment-opportunity-corner-lot-residence-in-palo-altos-best-neighborhood/
July 28th, 2010 at 11:53 am
It was seized in foreclosure not too long ago.
No Galileo. No. No no no no! (stomps foot) That cannot be. This is Palo Alto. Foreclosures do not happen in Disneyland!
Well, the people who bought it in 2007 must have been really bad, stupid people.
/sarcasm
July 28th, 2010 at 11:58 am
There is no such thing as foreclosure in Palo Alto.. This home on Fulton must be from East Palo Alto.
July 28th, 2010 at 7:52 pm
>>It was seized in foreclosure not too long ago.
Pralay was fired from his job also.
July 28th, 2010 at 7:55 pm
>> Last month he gave us some “solid hints” (and more solid hints and more more hints) about his home.
And here’s the last hint…drum-roll: My home is on the right side of Middlefield.
Remember, Real Estater never lies.
July 28th, 2010 at 8:26 pm
> Remember, Real Estater never lies.
It’s not a lie, if you believe it.
July 28th, 2010 at 8:35 pm
Real Estater’s house is both on the right side and on the wrong side of Middlefield (as long as you’re driving North)
July 28th, 2010 at 8:37 pm
My home is on the right side of Middlefield.
You left off the part about driving north.
July 28th, 2010 at 8:45 pm
My home is on the right side of Middlefield.
Remember, Real Estater never lies.
——
And Real Estater’s definition of “right side” is similar to Bill Clinton’s definition of “sex”.
He never lies. He just redefines.
July 28th, 2010 at 8:54 pm
They’ve been there three years and haven’t ripped down that horrible wallpaper?
—–
Changing wallpaper? Real Estater couldn’t think about it. He changed bulbs occasionally and fixed plumbing with Drano, but couldn’t “really think of anything else”.
July 28th, 2010 at 11:58 pm
>>They’ve been there three years and haven’t ripped down that horrible wallpaper?
Pralay has been around here for 3 years, and still doesn’t have a kid.
July 29th, 2010 at 12:07 am
That depends on the definition of “kid”.
July 29th, 2010 at 8:38 am
…still doesn’t have a kid.
Does this site increase the risk of pregnancy or subliminally encourage procreation?
July 30th, 2010 at 11:20 pm
“Pralay has been around here for 3 years, and still doesn’t have a kid.”
what are you, RE, his grandmother?
July 31st, 2010 at 12:07 am
Pralay has been around here for 3 years, and still doesn’t have a kid.
Faux Estater, are you sure those kids are yours? I’ve been banging your wife awfully hard while you were away on your super-duper-multi-timezone-megaproject.
July 31st, 2010 at 12:25 am
lol – RE is a debt slave for the worst house on his block.
August 17th, 2010 at 5:04 am
[...] at several listings on the same street. First there was the English Garden Shed, then the Vampire Frat House, and our latest Lincoln link was Limestone and Marble and Rock, Oh My! (the one with MAGICAL [...]
November 6th, 2010 at 2:21 pm
Sold for $7M.
To sum it up, all 4 houses in the “location^3″ series sold for below asking.
November 6th, 2010 at 2:43 pm
only a million below begging price?
November 6th, 2010 at 2:48 pm
>>To sum it up, all 4 houses in the “location^3″ series sold for below asking.
So says the amateur. The way mega homes are marketed is different from low end. At the low end, you want to under-price the home to attract multiple offers. At the high end, there’s usually only 1 or 2 buyers, so you over-price it to allow room for negotiation.
November 6th, 2010 at 2:58 pm
> At the low end, you want to under-price the home to attract multiple offers
Like that one? Anyway, I was just stating a fact. No opinion given.
November 6th, 2010 at 4:09 pm
Finally! Real Estater admits:
1. It’s possible to “over-price” a home.
2. It’s possible to “under-price” a home.
Now if we can just get him to admit that the final sale price is the same in both cases. Or, alternatively, given he has structured homes on a high end and low end, there must be a home in the middle that should be priced very near fair market value. The questions are:
1. Does under-pricing a home increase the final sales price?
2. Does over-pricing a home increase the final sales price?
3. For the home in the middle, is it the best strategy to price near market?
The above questions assume we have defined “low end” and “high end” nicely. If someone over-bids on a $2M PA home, does that make it a “low end” home?