This home has a sorry marketing history.
Listed for $344,500 on 5/6/17
Price Adjusted to $299,750 on 8/1/17
And price adjusted again today 8/17/17, to $275,000.
The ad copy says: “Seller is motivated.
I wonder how motivated?
It is not just about price per square foot. Comparable sales requires some degree of adjustment for buyer preferences, and I have my preferences by which I measure a home’s worth. How much will it cost to get it ready to rent or sell? My estimate is:
$5000 for pest work
$10,000 for interior paint and cleaning
$5000 for new fixtures and appliances and installation
$10,000 for exterior paint
$5000 repair and replace as needed for items typically found on the homes inspection
$2000 Estimate only, actual cost will depend on a septic inspection performed in escrow
The thing to remember, is the comparable home that sold for $275,000 in the spring (12728 Summit Ridge) was smaller, but in much better condition. It probably needed less than half of what this home needs in terms of repair and replace, and it had a two car garage, and it had long range views of the mountains.
So, again, just estimating, this Spanish Lane house needs- $32,000 to get it ready to rent or sell. That brings the real cost of this home up around $307,000. That comes out to $146 per square foot, and that is very close to what the summit Ridge home sold for in price per square foot.
Here is what I don’t like about the home. The one bathroom is upstairs in the master, but the guest bathroom is downstairs. There is no cheap fix to this functional obsolescence. Installing a third bathroom upstairs might cost $45,000. The return on investment would be marginal at best. This home will top out next year, even if all the improvements were made at $330,000 and it could float down to $300,000 or a little below during the winter months.
To make this home a good investment, I think the purchase price needs to be $250,000 or below.
Another way of thinking about this home- it is really a 2 bedroom 1 bathroom home with a utility room and bathroom downstairs. And, it’s a fixer. In that light, it is not such a good investment. I think I will pass.
It is good to get excited about homes, and it is good to take a second look and consider the true value.