patrick.net

So what happens to the property taxes when you buy a house like this for $1M+?

jvolstad says

So what happens to the property taxes when you buy a house like this for $1M+?

You pay it or you lose the house.

jvolstad says

So what happens to the property taxes when you buy a house like this for $1M+?

You pay it for life. I guess you must really love the 24hr Bush library in your city. ;)

dang. the 1959 house (and newish roof!) itself is actually worth what, $50k? $75k? And the rest is the land. Ask me again why I looking to buy outside of the Peninsula.

murakami says

dang. the 1959 house (and newish roof!) itself is actually worth what, $50k? $75k? And the rest is the land. Ask me again why I looking to buy outside of the Peninsula.

Because you like Norwegian Woods?

Rebuild cost is much higher than $50k-75k, not sure if you were being facetious or not. It's at least $300/sqft for a mid grade house in this area due to all of the regulations and permits required. So it isn't just the land, it is also that building a house here costs a fortune.

Gwave9x says

Rebuild cost is much higher than $50k-75k, not sure if you were being facetious or not. It's at least $300/sqft for a mid grade house in this area due to all of the regulations and permits required. So it isn't just the land, it is also that building a house here costs a fortune.

If you were to rebuild you would have a modern house with new appliances, built to all current codes. The house would be stronger, safer, have a better layout, more electrical outlets, new roof, pipes, etc. For a bit extra you could add 9' ceilings, a basement, greater roof slope for better attic storage, rock solid foundation and subfloor, permanent termite prevention all custom built to your tastes. That might actually be worth $300 sqft.

Don't pretend existing 1959 era construction is an equivalent - it isn't by a long shot.

The point is, it is simply not possible to build a house for $50k in this area, never mind the time and effort you need to dedicate to such a project. Thus having a structure on the land that you can live in is worth more than $50k. In other words, the lot plus this house would sell for much more than the lot itself, I would think twice as much.

Anyway, this house is in great shape - new electrical, new copper plumbing, new roof, new water heater, and no noticeable structural issues. They actually updated important things and maintained the house. It isn't a lipstick on a pig flip.

wave9x says

The point is, it is simply not possible to build a house for $50k in this area, never mind the time and effort you need to dedicate to such a project. Thus having a structure on the land that you can live in is worth more than $50k. In other words, the lot plus this house would sell for much more than the lot itself, I would think twice as much.

Anyway, this house is in great shape - new electrical, new copper plumbing, new roof, new water heater, and no noticeable structural issues. They actually updated important things and maintained the house. It isn't a lipstick on a pig flip.

That would make just the house - with its 1959 construction and all upgrades - worth $320/sqft assuming a $1M sale price. Not likely if new construction with all the aforementioned benefits can be had for $300/sqft.

You are assuming that people only buy things based on the cost of construction, which is an incorrect assumption. It can literally take 2 years to build a house in this area, if it will even be approved by the city or county at all. Avoiding the effort, waiting, and hassles is worth a lot to most people, not to mention avoiding paying two mortgages (or rent plus mortgage) during the process. I also disagree that new construction is automatically better, many new building techniques are centered around cost savings rather than quality. And you won't get features like wood burning fireplaces that are outlawed here in new houses.

New Renter says

If you were to rebuild you would have a modern house with new appliances, built to all current codes. The house would be stronger, safer, have a better layout, more electrical outlets, new roof, pipes, etc. For a bit extra you could add 9' ceilings, a basement, greater roof slope for better attic storage, rock solid foundation and subfloor, permanent termite prevention all custom built to your tastes. That might actually be worth $300 sqft.

Why would you ? You pretty much blew your savings and much of our leisure time.

na! i rather spend 100 bucks on a new radiator for my Alpha.

wave9x says

You are assuming that people only buy things based on the cost of construction, which is an incorrect assumption. It can literally take 2 years to build a house in this area, if it will even be approved by the city or county at all. Avoiding the effort, waiting, and hassles is worth a lot to most people, not to mention avoiding paying two mortgages (or rent plus mortgage) during the process. I also disagree that new construction is automatically better, many new building techniques are centered around cost savings rather than quality. And you won't get features like wood burning fireplaces that are outlawed here in new houses.

If you have two identical houses for sale, same neighborhood, same basic layout, identical lots but house #1 was built in 1959 the other completed in 2013 I'd bet the newer house will get the higher price.

If you feel the house as is to be worth $300 sqft then it is. Its your dough. You probably have little or no options from the new construction market so this whole discussion is moot anyway.

FYI you can indeed get a wood burning fireplace even today. It has to be EPA certified but at least the building department in San Jose was perfectly willing to permit such a fireplace:
http://fireplacex.com/ProductGuide/FuelTypeOverview.aspx?fueltype=wood&fueltab=0

New or old wood burning is still forbidden on spare the air days

As for cost cutting that may be true, you get what you pay for. It was true in 1959 and its true today. Just because a house has been standing for 60 years and has had upgrades does not mean it has been spared decades of termite munching, dryrot, soil heave, and whatnot.

You are also buying a house built to 1959 earthquake codes, whatever those were. Given the house in question is about 1/2 mile from Crystal Reservoir which lies directly on top of the San Andreas Fault I would think you'd have some appreciation of a house built to modern earthquake codes:

http://geomaps.wr.usgs.gov/sfgeo/quaternary/stories/crystalspr_linearvly.html

At least with new construction codes you get plenty of anchor bolts and shear walls.

thomaswong.1986 says

New Renter says

If you were to rebuild you would have a modern house with new appliances, built to all current codes. The house would be stronger, safer, have a better layout, more electrical outlets, new roof, pipes, etc. For a bit extra you could add 9' ceilings, a basement, greater roof slope for better attic storage, rock solid foundation and subfloor, permanent termite prevention all custom built to your tastes. That might actually be worth $300 sqft.

Why would you ? You pretty much blew your savings and much of our leisure time.

na! i rather spend 100 bucks on a new radiator for my Alpha.

Well of course if you have an Alfa Romeo your savings and leisure time are already spoken for.

Looks like this house is already sold after just a few days.

The house sold for $1.18m, for anyone interested.

You called it.

I was actually a little low.

wave9x says

The house sold for $1.18m, for anyone interested.

Insane - for me to pay that for a 1959 house, it better come with an ever revolving selection of playboy bunnies. All utilities and taxes paid for life and all the food and gas I buy for the rest of my life paid for.

Sheesh, what some folks pay - flipping unreal.

It all depends on how much you clear every month.

wave9x says

The house sold for $1.18m, for anyone interested.

1.18m is nothing to the person sitting on 10m and worried about getting caught with that much cash that they can't explain. Just saying...

mmmarvel says

wave9x says

The house sold for $1.18m, for anyone interested.

Insane - for me to pay that for a 1959 house, it better come with an ever revolving selection of playboy bunnies. All utilities and taxes paid for life and all the food and gas I buy for the rest of my life paid for.

Sheesh, what some folks pay - flipping unreal.

yes.. this is a very unreal insane place.. and frankly prices from 1959 to say 1997 were far more sane and affordable. Yet it all went to the crazy house since 1998 to today.

while we had a booming economy (via growing tech industry) in the 70s and into late 90s we certainly didnt see this kind of run away prices. But as tech industry contracted (shrank to half!) prices skyrocketed for all the wrong reasons.

Crazy crazy crazy

donjumpsuit says

This one is well worth 1.2M.

real 1.2m homes be it San Mateo or Los Gatos were typically 3000+ sq ft or more well above into the hills with a very modern design. thats what it used to be like. you might even have a rancher with horse barn in woodside ... therefore if you were to afford a $1M home .. you actuall got a $1M home back in the day.. 1500 sq ft for million is just crazy! if I had to move it would constitute a downgrade .. less home for more money.

there is no doubt we are still very much in bubble just looking at the historical norm of what a home used to mean.