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Thursday, February 15, 2007

Local real-estate observations

Like anyone who owns a house these days and has an internet connection, I can't help to bird-dog the real-estate sites to see what the world thinks my house is worth. Prices have definitely dropped, and things are far "cooler" overall than they were about 18 months ago. But the market is still moving: the local MLS website shows many houses in contract, and a small development of new houses just sold out a few blocks away; construction on these houses finished a couple weeks ago.

It helps that the development is probably the only set of new single-family houses that will exist within an easy bike-ride to Google HQ, unless the area around Shoreline Park is rezoned to allow residential and some old office parks are torn down. (Even then, I can't see single-family properties being built there; it would almost certainly be condos.)

We also saw a small apartment complex go for sale a few blocks away at what looked to be a bargain price for Mountain View: about 1.6M for a 1/4 acre with ten apts. (We've been investigating investing in apts for awhile, although they're generally far too expensive to buy for cashflow in this area.) But at that price, it would cashflow positive with 30% down commercial financing as apts, and the apts could be condo-ized and sold for at least $350K each. This math occurred to faster people than us; we called the agent and he said there were 15 offers on the place. According to him, it was going to go for well above the asking price.

We declined to get in the offer queue...

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