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In Palo Alto, as in many other affluent yet zoning-constrained enclaves around the Bay Area, homeowners are going underground. Architects and contractors report that the once-lowly basement has become the hottest area in home design, resulting in a flotilla of square-footage-concealing iceberg houses. In an era when modest cottages routinely sell for well over $1 million, going big below street level is one of the most viable ways to add living space to a home investment. “The land costs are so expensive, if you don’t build down, it’s a waste,” says Gloria Young, a real estate agent and developer based in Palo Alto.
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