KPIX Story about Multiple Offers - Tying Up Loose Ends

KPIX ran a story in March about a house that received 42 offers. I said at the time that the house was severely underpriced. Out of curiosity, I decided to see what happened to it.

The house in question was 555 Edinburg. It was listed at $459,000, which is equivalent to $367 per square foot. By way of comparison, the median price-per-square-foot multiple for the 16 comparable houses that I identified was $451. In other words, the house on Edinburg was priced at a large discount relative to the comps, so it should have received multiple offers.

The sale closed on April 22nd, at a price of $570,000. That's equivalent to $456 per square foot -- right in line with the comps. Take a look at the chart, below, which shows the distribution of price-per-square-foot multiples for the comps.

555 Edinburg landed almost precisely in the middle of the distribution. Keep in mind that the comps were sold over a five-month period between October, 2008 and February, 2009. Those were the darkest months of the financial panic that ensued following the collapse of Lehman Brothers. In other words, far from signaling a recovery in the San Francisco housing market, the sale of 555 Edinburg signaled continuing softness.

The good news, if there is any, is that the market clearly did its job. Despite what was no doubt a bidding frenzy, 555 Edinburg sold right where it should have.