It’s A Puzzle

rubik

Got this really outstanding e-mail the other day from blog reader Nancy Chang:

“Hi Jim,

Just read your blog entry on “Choosing the right path”. Sounds a lot like homes in the $600,000 to $800,000 will get offer prices over asking prices. So what do you think about 827 Vespucci lane unit that sold for $570,000 when the asking was $630,000 and the 1497 Marlin unit that sold for $630,000 and the original listing price was $699,000? It just doesn’t make sense at all. Why are they sold for so much lower while others are being bought for higher than asking price. By the way, I don’t know about the Marlin unit but I saw the Vespucci unit. It’s nice and updated and the HOA is low. What gives?”

GREAT QUESTION! There’s not an easy answer either. Why do some homes get 13 offers, go $120,000 over asking and some sit for months? The example in Nancy’s e-mail are classics too. Maybe the only explanation lies in the reality that the old, pre 1998, way of thinking about real estate has returned…being that location and type of property are of singular importance in determining value. In 2004, for example, anyproperty seemed to get multiple offers! If your house was right on Hillsdale Blvd, it got multiple offers. Small condos got 15 offers, houses right next to the train tracks did too. The properties that Nancy mentions above are all townhouses and even though they are in good locations and have reasonable HOA dues they’re still townhouses…and those have historically not been as valuable as single family homes.

 I know that I have far more requests from clients this year to find a single family house than for condos. One in particular, a young woman in her late 30’s who’s qualified up to about $385,000 is determined to find a single family house when a condo would be so much better suited for her. About 95% of the houses in her price range are in areas that she really doesn’t want t0 live in, but she’s SO very motivated to buy a house that she’s been overlooking these homes obvious location problems to reach her goal. The locations of the condo’s in her price range are much better…but that doesn’t matter. A house has more appeal.

Maybe we’re just in a normal market…or maybe the desire to live in the Mid Peninsula is so stable and solid that we’ll see mutiples on all categories again soon. We’ll see…

Comments

  1. the vespucci place has only 2 bedrooms, I think that is why it is sold at that price. There are 3 bedrooms townhome around $650k.

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