Seaside Sales

[Smiling JOe]

Two Seaside homes closed yesterday, each at over $1,000 per sq ft. One sold at $3.3 Million, listed at $3.5 Million, and the other sold at $1.75 Million, listed at $1.795 Million.

[Franny]

Very good information SJ. thanks

[SablePoint]

Two Seaside homes closed yesterday, each at over $1,000 per sq ft. One sold at $3.3 Million, listed at $3.5 Million, and the other sold at $1.75 Million, listed at $1.795 Million.

And people question the value of WaterColor at $600/sq. ft!

Seaside is no doubt a great place. It's where it all started! It's fabulous!

But you can own in WaterColor (with it's superior amenities) and you also get nearly all the benefits of Seaside as well! I can walk from my house in Phase 3 to the Town Center of Seaside in about 10 or 12 minutes. I've not timed it riding a bike, but I'm sure I can do it in under 5 minutes.

I'm not an expert on construction... but the fact that most of the Seaside homes were built a long time ago means they are not constructed as well as the new homes being built in WaterColor. And they don't have the same amenities as the newer homes... including some things that you can never change, like high ceilings, etc.

These prices in Seaside are what the market is willing to pay to own in Seaside. I think that down the road... once WaterColor is built out and the market stabilizes... youl'll see WaterColor houses selling at a premium over Seaside houses.

[full time]

"Two Seaside homes closed yesterday, each at over $1,000 per sq ft."

Yes - but what was the floor plan, architectural design, finishes .. did it have granite, a carriage house, a claw tub and on and on and on? Without that information, we cannot possibly know if the poor functionality, age and general state of disrepair of the house caused such a high price per square foot to be paid by the buyer. Or we could just assume that over $1,000.00 a foot is the going rate in Seaside and has been for some time - just like the going rate in Watercolor is generally $500.00 to $800.00 dollars a foot. Hence, Sable Point asking $385,000.00 for a 1/5 fraction of a 4000 foot Watercolor house. I know, I'm a simpleton.

[beachmouse]

Don't underestimate the value of being the place named in all the design or urban planning books. Seaside will always command a premium compared to surrounding areas in the same way a home by a big name architect will always command a premium compared to homes designed and built by people without the national/international reputation.

[Smiling JOe]

"Two Seaside homes closed yesterday, each at over $1,000 per sq ft."

Yes - but what was the floor plan, architectural design, finishes .. did it have granite, a carriage house, a claw tub and on and on and on? Without that information, we cannot possibly know if the poor functionality, age and general state of disrepair of the house caused such a high price per square foot to be paid by the buyer. Or we could just assume that over $1,000.00 a foot is the going rate in Seaside and has been for some time - just like the going rate in Watercolor is generally $500.00 to $800.00 dollars a foot. Hence, Sable Point asking $385,000.00 for a 1/5 fraction of a 4000 foot Watercolor house. I know, I'm a simpleton.

Both homes are on interior lots, north of 30A. Seaside is much less spread out than WaterColor, and there is not as much of a price variance for properties north of 30A as compared to WaterColor.

The one selling at $3.3 Million --> Built 1994, 2680 sf, 4bd/4.5 bath
"This stately home of classical design features an open and light-filled great room with antique pine floors, fireplace, gourmet kitchen, master suite with whirlpool tub. Redwood siding, recirculating hot water system for instant hot water, rheostats on all light fixtures, two water filtration systems. Addl. 1160 SF porches/balcony. Includes 2 bedroom, 1 bath guest house (+- 850 SF HVAC) with fireplace. Featured in "Coastal Living"."

They paid $2.2 Million four years ago. Yep, real estate as an investment it just terrible. :funn:

The other house is older, built in 1989. Two Story, 3/3, 1700 sf, raised tower, room for carriage house on lot.

[SablePoint]

"we cannot possibly know if the poor functionality, age and general state of disrepair of the house caused such a high price per square foot to be paid by the buyer.

Not sure what you mean here Full Time? I'm guessing that the two houses were NOT in a general state of disrepair, nor did they have poor functionality... but were in fact in spectacular condition. Otherwise they would not have commanded such a nice price.

[full time]

"The one selling at $3.3 Million --> Built 1994, 2680 sf, 4bd/4.5 bath"

1200 a square foot. 16 homes sold in Seaside since 1/1/06 and the average price per square foot ..... drum roll please .... 1200 a square foot. Funny how that works out. Other than location, the rest of that list is pretty much a matter of personal taste. It might help you sell before the other 150 listings but when the rubber hits the road, you'll still only get what the market dictates (i.e. about the average price per square foot for the area). So back to my original question, how much per square will jimmyp pay for a Watercolor house?

[SablePoint]

"Hence, Sable Point asking $385,000.00 for a 1/5 fraction of a 4000 foot Watercolor house. I know, I'm a simpleton.

Also not sure what you're getting at here. Are you doing quick division in your head and thinking that my price is approx. $1000 per sq. ft? (Approx. $400,000 divided by 4000 sq. ft.?)

Actually, the house has 3,300+/- total heated/cooled sq. ft.

Let me first say that I'm not selling "fractionals". We are doing what lots of people do and that is getting partners to share ownership in a vacation home.

This is a brand new house that is decked out with all the amenities, finishes, extras, and upgrades. It has a large carriage house above the 2 car garage. It has 3 covered porches (all with tongue & groove ceilings). One of the covered porches has a wood burning fireplace and outdoor summer kitchen. (by the way, Kitchens are the highest cost/sq. ft. of all space in a house... and our house essentially has THREE kitchens total).

I could go on and on... but you can read all about it at www.129Bluejack.com (http://www.129Bluejack.com).

And the cost per sq. ft. is only $583/sq. ft. That's finished... completely decorated, furnished, and outfitted, etc.

This is a good deal any way you measure it. We have a house that we want to keep because WE LOVE WATERCOLOR. The only way we can justify it is by getting partners and sharing the ownership and expenses.

Since most people can't use their vacation home more than 20% of the time anyway, we're looking for partners who want to own 20% of an outstanding Resort Vacation Home in WATERCOLOR.

[Smiling JOe]

"The one selling at $3.3 Million --> Built 1994, 2680 sf, 4bd/4.5 bath"

1200 a square foot. 16 homes sold in Seaside since 1/1/06 and the average price per square foot ..... drum roll please .... 1200 a square foot. Funny how that works out. Other than location, the rest of that list is pretty much a matter of personal taste. It might help you sell before the other 150 listings but when the rubber hits the road, you'll still only get what the market dictates (i.e. about the average price per square foot for the area). So back to my original question, how much per square will jimmyp pay for a Watercolor house?

Fulltime, it sounds like you are trying to indirectly tell us that properties in all developments are worth no more than the avg price per sq ft. As stated earlier, Seaside is much less diverse in terms of location and time built, than WaterColor. If the avg price of a home in WC is $700/sf, does that mean that if one is built with more upgrades, buyers are not willing to pay more than the avg price of $700/sf? They call it average because it is just that. The majority of the houses will be in the middle price range, with lows and highs on both ends. I'm really not sure what you are trying to tell us. Please share your thoughts.

[PalmBeach]

I'm not an expert on construction... but the fact that most of the Seaside homes were built a long time ago means they are not constructed as well as the new homes being built in WaterColor. And they don't have the same amenities as the newer homes... including some things that you can never change, like high ceilings, etc.
Seaside has always had a strict design code that required high quality materials and all homes have had features like high ceilings from the beginning. And, for some of us the 1980's weren't that long ago.

[SablePoint]

Seaside has always had a strict design code that required high quality materials and all homes have had features like high ceilings from the beginning. And, for some of us the 1980's weren't that long ago.

Sorry Palm Beach. I didn't mean to disparage Seaside in that way. I am absolutely smitten with Seaside.

And I obviously don't know what I'm talking about with regard to High Ceilings in Seaside either. I do know that they had high design codes, just like WaterColor (and other high end developments) now do. Thanks to Seaside for setting the bar so HIGH!

I should have been less specific and more general... because what I meant to infer is that building codes have been tightened dramatically since Seaside developed the new urbanism concept and showed us all how wonderful these developments can be.

I was making an assumption that the new houses being built today in WaterColor are just sturdier... and maybe I'm wrong.

Lastly... one thing that cannot ever be done is replicating the charm that is Seaside.

[Chickpea]

Great news SJ on Seaside.

[beclareesq]

Shelly, the negative spin please

[Sandcastle]

Great news. It looks like the planned changes haven’t hurt valuations at all. In fact, I think they’ve helped them a lot.

[SHELLY]

Shelly, the negative spin please


:( :( :( :( :( :(

Thousands of innocent balloons were sacrificed for just these two sales!!

http://www.theideabox.com/images/ideaimages/7941.jpg


.

[TooFarTampa]

:( :( :( :( :( :(

Thousands of innocent balloons were sacrificed for just these two sales!!

http://www.theideabox.com/images/ideaimages/7941.jpg


.

:rofl:

[Smiling JOe]

:( :( :( :( :( :(

Thousands of innocent balloons were sacrificed for just these two sales!!

http://www.theideabox.com/images/ideaimages/7941.jpg


.Shelly, in many respects, I have agreed with your analysis of our market over the last year. With this above comment, you have made me laugh. You are a trip. :D

[Busta Hustle]

Sure hope they have lots of working fire hydrants...30 year old wood frame houses and zero lot lines...

[Gypsea]

Thanks for the laugh SHELLY! :rolling:

[flyforfun]

:( :( :( :( :( :(


Thousands of innocent balloons were sacrificed for just these two sales!!

http://www.theideabox.com/images/ideaimages/7941.jpg


.


Well, even I can laugh at that one, however everyone knows Seaside does not allow signs or balloons! Like Shelly says, you should not invest in RE at the beach unless you want to make an easy million dollars!:rolling:

[SHELLY]

Like Shelly says, you should not invest in RE at the beach unless you want to make an easy million dollars!:rolling:

Yep..considering you start out with $3-Million.:biggrin:


.

[Chickpea]

Sure hope they have lots of working fire hydrants...30 year old wood frame houses and zero lot lines...

Most of the houses at Seaside are actually NOT zero lot line homes..... they are around Ruskin Place but most are detached.....

[Smiling JOe]

Well, even I can laugh at that one, however everyone knows Seaside does not allow signs or balloons! Like Shelly says, you should not invest in RE at the beach unless you want to make an easy million dollars!:rolling:

Yep..considering you start out with $3-Million.:biggrin:


.



Shelly, :banging:

They paid $2.2 Million for the house and sold it for $3.3 Million. I think your math is backwards. :funn:

[fisher]

Both homes are on interior lots, north of 30A. Seaside is much less spread out than WaterColor, and there is not as much of a price variance for properties north of 30A as compared to WaterColor.

The one selling at $3.3 Million --> Built 1994, 2680 sf, 4bd/4.5 bath
"This stately home of classical design features an open and light-filled great room with antique pine floors, fireplace, gourmet kitchen, master suite with whirlpool tub. Redwood siding, recirculating hot water system for instant hot water, rheostats on all light fixtures, two water filtration systems. Addl. 1160 SF porches/balcony. Includes 2 bedroom, 1 bath guest house (+- 850 SF HVAC) with fireplace. Featured in "Coastal Living"."

They paid $2.2 Million four years ago. Yep, real estate as an investment it just terrible. :funn:

The other house is older, built in 1989. Two Story, 3/3, 1700 sf, raised tower, room for carriage house on lot.


Was the larger house located at 81 Seaside Avenue?

[Smiling JOe]

Was the larger house located at 81 Seaside Avenue?yes and the other was 33 Pensacola.

[spinDrAtl]

Both homes are on interior lots, north of 30A. Seaside is much less spread out than WaterColor, and there is not as much of a price variance for properties north of 30A as compared to WaterColor.

The one selling at $3.3 Million --> Built 1994, 2680 sf, 4bd/4.5 bath
"This stately home of classical design features an open and light-filled great room with antique pine floors, fireplace, gourmet kitchen, master suite with whirlpool tub. Redwood siding, recirculating hot water system for instant hot water, rheostats on all light fixtures, two water filtration systems. Addl. 1160 SF porches/balcony. Includes 2 bedroom, 1 bath guest house (+- 850 SF HVAC) with fireplace. Featured in "Coastal Living"."

They paid $2.2 Million four years ago. Yep, real estate as an investment it just terrible. :funn:

The other house is older, built in 1989. Two Story, 3/3, 1700 sf, raised tower, room for carriage house on lot.


What did they cost back in the day?

Woulda coulda shoulda.

[Beachlover2]

What did they cost back in the day?

Woulda coulda shoulda.



33 Pensacola - 1992 385K 1998 660K 2007 1.7 mil

[SHELLY]

Shelly, They paid $2.2 Million for the house and sold it for $3.3 Million. I think your math is backwards. :funn:[/SIZE][/FONT]

Please post 4 years of carrying costs + maint upgrades + maint costs + RE commission and let me recheck the math.


BTW, how long has this house been on the market (total time, not re-listed time) and was $3.5 the original listing price?

.

[fisher]

They paid $2.2 Million four years ago. Yep, real estate as an investment it just terrible. :funn:

The other house is older, built in 1989. Two Story, 3/3, 1700 sf, raised tower, room for carriage house on lot.
[/SIZE][/FONT]

Good for them--they did make a tidy profit on these homes (roughly 8% to 9% annualized returns after considering commissions and carrying costs over the years), but they bought pre 2004. Anyone that purchased pre 2004 should still be in the money. However, many, many people are taking hefty losses on property bought in 2004, 2005 and 2006. I saw a specific lot purchased in 2004 and sold the other day at a whopping 50% LOSS to the seller. And, the jury is out on whether the new owners of these homes will make similar returns given the fact that historically real estate appreciation has tended to track only slightly ahead of inflation.

Also, consider that the same $2.2 million invested in an index fund tied to the Dow or Nasdaq in May of 2003 would have grown to about $3.4 million and $3.5 million, respectively. Plus on the index funds there would have been no property taxes, insurance, HOA fees, realtor commissions, utilities, maintenance and other carrying costs that reduced the ultimate profit taken out of the real estate investments. Of course, the enjoyment the owners undoubtedly got out of owning a beautiful home in Seaside far outweighed the additional profit they could have taken by owning a piece of paper. :D

Investing in real estate, stocks, bonds, commodities, etc can result in positive or negative returns and leveraging any of these investments can increase your returns OR increase your losses.

[Pirate]

They paid $2.2 Million four years ago. Yep, real estate as an investment it just terrible. :funn:

The other house is older, built in 1989. Two Story, 3/3, 1700 sf, raised tower, room for carriage house on lot.
[/SIZE][/FONT]

The house was probably on the market for 4 years as well. Many of the Seaside listings are 2+ years old. Most of what has moved is well under initial asking price, some of it was reduced by over 40 percent before it sold. They put a great deal of pressure on sellers not to lower asking prices in Seaside. It is a unique community which I like alot but the rental fees and management fees really squeeze the money making potential from these homes. If you really penciled this property out I bet it makes 5-7 percent annually through the biggest boom in real estate history.

As a second home if you have more money than you could ever spend it's a great place to spend time.

[Smiling JOe]

Please post 4 years of carrying costs + maint upgrades + maint costs + RE commission and let me recheck the math.


BTW, how long has this house been on the market (total time, not re-listed time) and was $3.5 the original listing price?

.
Original asking price has no relevance here. What does matter is that they sold it for $1 million more than they purchased it. I have no idea on the carrying costs and other expenses, but for fun, lets say that they put down only 20% when they purchased it, and then you do your math on their return on cash invested, with good guesses on the other costs. Lets look at a 30 year loan at 7% in your calculations. While I haven't done the math on that, I don't have to do much calculating to know that the sellers faired well in this purchase and sale. ;-)

[Smiling JOe]

If you really penciled this property out I bet it makes 5-7 percent annually through the biggest boom in real estate history.


What you say is likely true, but only if you paid cash for the property, which does happen on occasion down here. I encourage to pencil out the math using their cash outlay and see if you don't get a different return on your money, and then you guys can compare that real growth to QQQ or DOW.

[scooterbug44]

Newer isn't always better, especially if you're comparing new homes quickly built for spec with older homes designed as a custom residence.

Varying sizes of the houses might be a factor as well. The sizes of rooms has increased over the years, so a Watercolor house built in the last couple of years may have the same number of bedrooms and baths as a Seaside house that is quite a bit smaller.

I would assume that a Seaside home built in 89 or 94 has remodeled its kitchen so it would have the same amenities.

Don't factor out that Seaside homes tend to be closer to the beach and an active town center than a Watercolor home as well.

[Coast is Clear]

We finished building our house in Seaside in 2005 to new codes, have limited debt on it, it has remained cash positive every year, and we have very conservatively doubled out money on the property value.

Plus we have completely enjoyed using the house when we can.

Seaside is unique in that all properites are close to the beach, and it has an activity level in town that no other property on 30-A can match.

It has been a no brainer for us and that is just over the last 3 years.:clap_1:

[fisher]

What you say is likely true, but only if you paid cash for the property, which does happen on occasion down here. I encourage to pencil out the math using their cash outlay and see if you don't get a different return on your money, and then you guys can compare that real growth to QQQ or DOW.

You can use leverage with stocks and real estate. So, it's apples to apples looking at it from a pure cash perspective without hypothesizing the amount of leverage used.

[Smiling JOe]

You can use leverage with stocks and real estate. So, it's apples to apples looking at it from a pure cash perspective without hypothesizing the amount of leverage used.That is true, but while the majority of real estate is leveraged heavily, can you say that the majority of people leverage their stock purchases as heavily? I have no stats on either, but I can make a good guess. On other difference is that when you use leverage to make stock purchases, the trading company comes knocking on the door for cash, or they will sell your shares at the market price, when the price of the stock drops too low. The same is not true for leveraged real estate when the market drops.

[flyguy]

Original asking price has no relevance here. What does matter is that they sold it for $1 million more than they purchased it. I have no idea on the carrying costs and other expenses, but for fun, lets say that they put down only 20% when they purchased it, and then you do your math on their return on cash invested, with good guesses on the other costs. Lets look at a 30 year loan at 7% in your calculations. While I haven't done the math on that, I don't have to do much calculating to know that the sellers faired well in this purchase and sale. ;-)


I did a little back of the envelope figuring, assumed time value of money and interest rate were the same at 7%:

2.2 million carried four years at 7%: 154K/year
Tax/Ins/Upkeep/etc. (big guess on my part) 30K/year
Real Estate Comm: 6% (another guess) 198K

Total carrying costs: 934K

Depending on the amount of downpayment, not much of a return except for the fact they got to use a great beach house. Maybe they rented it out as well. Hard to say.

I know my figures are just a guess, but they certainly did not make anywhere close to a million dollars.

Flyguy

[Smiling JOe]

I did a little back of the envelope figuring, assumed time value of money and interest rate were the same at 7%:

2.2 million carried four years at 7%: 154K/year
Tax/Ins/Upkeep/etc. (big guess on my part) 30K/year
Real Estate Comm: 6% (another guess) 198K

Total carrying costs: 934K

Depending on the amount of downpayment, not much of a return except for the fact they got to use a great beach house. Maybe they rented it out as well. Hard to say.

I know my figures are just a guess, but they certainly did not make anywhere close to a million dollars.

FlyguyI don't believe I said that they netted $1Million. My greater point to Shelly was that they didn't spend $3 million and are now left with only $1 Million, as he suggested in jest.

Using your numbers of real estate comm being at 6%, upkeep at 30K per year, and 7% interest, and adding to that closing typical closing costs on the sale of doc stamps on the deed being $23,000, with 20% down payment the return on cash is about double what was stated earlier. That number becomes an avg annual rate of return of 15% rather than the 5-7% which someone stated earlier, AND, they basically had a free house in Seaside to use any time they wanted. If this was their primary residence, that is free rent and no limited capital gains taxes.

[flyguy]

I don't believe I said that they netted $1Million. My greater point to Shelly was that they didn't spend $3 million and are now left with only $1 Million, as he suggested in jest.

Using your numbers of real estate comm being at 6%, upkeep at 30K per year, and 7% interest, and adding to that closing typical closing costs on the sale of doc stamps on the deed being $23,000, with 20% down payment the return on cash is about double what was stated earlier. That number becomes an avg annual rate of return of 15% rather than the 5-7% which someone stated earlier, AND, they basically had a free house in Seaside to use any time they wanted. If this was their primary residence, that is free rent and no limited capital gains taxes.

I come up with 8% ROI. But I agree with you that all in all it worked out fine for these owners given that the return also included the use of the house. I would have gladly taken the same deal if our numbers are correct. And it was someone else earlier that mentioned making a million on the deal, sorry.

Flyguy

[Smiling JOe]

I come up with 8% ROI. But I agree with you that all in all it worked out fine for these owners given that the return also included the use of the house. I would have gladly taken the same deal.

FlyguyUsing $2.2 Million loan, you probably get about 8%, but that would be with zero down payment. Their purchase price was $2.2 Million, and my example shows 20% down, thereby leaving $1.76 million for the loan.

flyguy, thanks for bringing up the subject though. I'll take it to. I have posted several times that there was a time, not too long ago, when second homes were purchased as luxury items, not investments. Sure, they might have been a sound investment for the buyers, but that was not the buyers' motivation. We will get back to those times in the future. I don't think the people spending millions of dollars for luxury lots, planes, RV's, mountain homes, beach homes, private club memberships, etc, are doing so because it is a great investment. It is just the cost to play with the big boys and girls.

[Pirate]

Using $2.2 Million loan, you probably get about 8%, but that would be with zero down payment. Their purchase price was $2.2 Million, and my example shows 20% down, thereby leaving $1.76 million for the loan.

flyguy, thanks for bringing up the subject though. I'll take it to. I have posted several times that there was a time, not too long ago, when second homes were purchased as luxury items, not investments. Sure, they might have been a sound investment for the buyers, but that was not the buyers' motivation. We will get back to those times in the future. I don't think the people spending millions of dollars for luxury lots, planes, RV's, mountain homes, beach homes, private club memberships, etc, are doing so because it is a great investment. It is just the cost to play with the big boys and girls.

It is 8% before the community fees, 5-7% after them. I have looked at at least 10 deals there in great depth. Love it there, but this little town still falls into Joe's luxury category and always will in my view. Not a bad thing.

[Babyblue]

:( :( :( :( :( :(

Thousands of innocent balloons were sacrificed for just these two sales!!

http://www.theideabox.com/images/ideaimages/7941.jpg


.

Funny, it was a friend of mine from "Bama" that bought the home for 1.7, cash.