Eichler Insights

Volume XII, Number 2 Summer 2004

A Decade of Eichler Homes Sales

Part 2 of An interesting look at homes that have sold more than once

The last issue of this newsletter generated some interesting comments and questions regarding its subject, and most of them centered on the rhetorical question, "Will these past increases in home valuation continue at those rates?" "How can those increases in the price of homes continue?" And most of my new home buyer clients, echo the same sentiments – "But that can’t continue, can it?"

It goes without saying that no one can predict the future in home prices or anything else, but I think these past 10 years of sales data, coupled with the prior 40 odd years of Eichler sales in our area can provide some reasonable views or projections into the future.

As I often tell my home buying clients ,"--- if you were to ask virtually all of the Eichler owners who bought their homes - whenever they did - did you think it would be worth that much today?" They would overwhelmingly say , "No – no way – but thank goodness!" Folks that bought their homes in the late 50’s for $20,000+ couldn’t believe it when they sold in the late 60’s for almost $40 thousand, and those folks that purchased at that time for $40K, when they sold in the late 70’s for values in excess of $100K couldn’t believe it either. Will that kind of percentage appreciation continue? Who knows, but just look at the valuations today! We are all fortunate to live in one of the most incredible areas of the planet, and perhaps that is why our real estate and home valuation continues to be so highly valued.

OK - on with the look at the decade- - -

In Redwood City, a home on Lyons that sold for $275,000in May of 1994, sold 3 years later in May of 1997 for $307,500 – a 12 % increase in that period of time.

In one of the 5 Eichler areas of San Jose, a home on Mossbrook Ave. that sold in June of 1995 for $265,000, sold in February of 2000 – at the height of the "bubble" for $550,000; it sold once again in May of 2003 for $599,000. All in all, during the highs and lows, a 126% increase in 8 years. A home on Hudson Dr. that sold in June of 1995 for $245,000, sold in November of 1999 for $390,000 - a 59% increase in 4+years. A home on Fairglen that sold in August of 1996 for $265,000, sold for $359,000 in December 1998 – a 35% increase in 2+years. A home on Comstock the sold for $266,000 in October 1996, sold for $516,000 in September of 2002 – a 94% increase in 6 years.

In another area or enclave of San Jose, a home on Menker Ave. that sold for $290,000 in March of 1999, sold in May of 2001 for $420,000 – a 45% increase in 2+ years. A home on Richmond Ave. that sold in November of 1999 for $325,000, sold in October of 2002 for $425,000 – a 31% increase in slightly less than 2 years. – in and out of the "bubble."

In San Mateo, a home on Celeste Drive that sold in February, 1994 for $190,000, sold in June of that year – a obvious investment "makeover" – for $$296,000, a 56% increase in about 4 months. A home on Eleanor Drive that sold for $277,000 in April of 1994, sold in June of 1998 for $305,000 – a 10% increase in 4 years. A home on Joanne Drive that sold for $280,000 in May of 1997, sold in June of 1999 for $392,000 – a 40% increase in about 2 years. A home that sold on Vanessa Drive for $365,000 in May 1998, sold in September 1999 – 16 months later – for $424,500, a 16% increase. And lastly, for San Mateo, a home that sold on Celeste Drive for $390,000 in August of 1999, sold in August, 2003 – during and after the "bubble" – for $524,270, a 34% in that 4 year period of time.

Moving up to "the Highlands’, a home in the San Mateo Highlands on Lexington Avenue that sold for $300,000 in October 1994, sold for $805,000 in July of 2002 – a 268% increase in 8 years, 30+% per year. Upgrade – by all means! A home on Ticonderoga Drive that sold in July 1997 for $350,000, sold in April of 1998 for $520,000, a 49% increase in less than 2 years – another upgrade. A Monticello home that sold in March 1994 for $335,000, sold in July of 2001 for $569,000 – a 70% increase in about 10 years. Another home on Ticonderoga Drive that sold in November 1995 for $360,000, sold July of 2001 for $649,000 – an 80% increase in about 6 years. A home on Allegheny Way that sold for $378,000 in March 1995, sold November of 2002 for $725,000 – a 92% increase in about 7 years. A home on Brandywine Rd. that sold for $390,000 in August of 1996, sold in April of 2000 for $800,000 – a 105% increase in 3+ years – a likely remodel, at the height of the "bubble." A home on Newport St. that sold for $400,000 in June 1997, sold for $435,000 in March of 1999 – a 9% increase in almost 2 years. A home on Trenton Place sold for $400, 000 in May of 1995 – that seems to be the approximate level at that time. It sold for $601,000 in April of 1999, and then again for $745,000 in May of 2000 – an 86% increase in 5 years. (Remember that annual percentage gain.) A home on Sheraton Place that sold for $385,000 in July, 1995 – sold for $858,000 in June of 2003 – a 123% increase in 8 years. A home on Lexington Ave. that sold for $412,000 in October 1995 for $412,000, sold $850,000 in April of 2001 – a

106% increase in 5+ years. Another home on Lexington Ave. that sold for $433,000 in August 1995, sold in June of 2003 for $910,000 – a 110% increase in almost 8 years. Another home on Lexington Ave. – a main thoroughfare – that sold for $450,000 in January of 1997, sold in May of 1999 for $571,000 – a 27% increase in 2+ years. A home on Bunker Hill Drive that sold for $502,000 of May 1998, sold for $705,000 in February of 2002 – a 40% increase about 2 years. A home on Ticonderoga Drive that sold for $750,000 in January of 2000 – the height of the "bubble" essentially, sold for $870,000 in May of 2001 – a 16% increase in about one and one/half years. During that same time frame, a home on Tarrytown St. that sold for $849,000 in July of 2000, sold for $899,000 in February of 2001 – a 6% increase in 8 months. So goes the Highlands – typical of other Eichler areas.

A look at the Eichler condominiums in Santa Clara. A home on Pomeroy that sold for $143,000 in September 1996, sold for $259,000 in October of 1999 – an 81% increase in 3 years. Another home on Pomeroy that sold for $169,000 in January 1996, sold in September 1997 - for $212,000, a 14% increase in 1+ years. In May of 1998, a Pomeroy home that sold for $222,000, sold in February 1999 for $237,000 – a 6% increase in about 9 months. A home on Benton St. that sold for $221,000 in May of 1998, sold in August of 2000 for $400,000 – an 81% increase in 2+ years, during "the bubble." Another home on Pomeroy that sold for $286,335 in June of 1999, sold in May of 2003 for $409,000 – a 43% increase in 4 years. And a home on Pomeroy that sold for $283,000 in December 1998, sold for $424,000 in August of 2002 – a 50% increase in 3+ years.

In Saratoga , a home on De Havilland Drive that sold for $585,000 in 1994, sold again in August of 2001 for $1,400,000, and then again in June of 2003 for $1,454,000 – a 149% increase in 9 years.

And finally in Sunnyvale. A home on Flamingo Way that sold in July 1995 for $353,000, sold in October 1997 for $415,000 – an 18% increase in 2+ years. A home on Kingfisher Way that sold in September 1994 for $300,000, sold in September of 1995 – 5 years later for $470,000 – a 57% increase in 5 years. A home on Templeton Ct. that sold for $305,000 in November 1995, sold in February of 2001 for $650,000 - a 115% increase in 6 years. A home on Hollenbeck Avenue that sold for $300,000 in November 1995, sold for $454,000 in February 1999 – a 51% increase in 3+ years. A Royal Ann Ct. home selling for $335,000 in May 1995, sold in November 1997 for $$540,000 – a 61% increase in 2+ years. A Spinosa Drive home that sold for $337,000 in November 1995, sold in April of 2003 for $687,000 – a 104% increase in 7+ years.

A home on Quince Avenue that sold for $390,000 in November 1997, sold again in July 1999 – 1+ years later - for $500,000, a 28% increase as the bubble began to take off. Another home on Quince Avenue that sold for $364,500 in August 1995, sold for $489,000 in January 1999 – a 34% increase in 3+ years. A home on Kingfisher Drive that sold for $370,000 in October 1997, sold again in April of 2001 for $640,000 – a 73% increase in 3+ years. A Ticonderoga Eichler that sold for $375,000 in January 1995, sold again in July 2003 for $790,000 – a 111% increase in 8+ years. A Trenton Drive home that sold in August 1995 for $386,500, sold in July 1999 for $642,000 – a 66% increase in almost 4 years. A home on Pomegranate Ct. that sold for $395,000 in July 1995 sold in June of 2000 for $735,000 – an 86% increase in 5 years.

A home on Vanderbilt Drive that sold for $470,000 in July 1997, sold in May of 2002 for $843,000 – in and out of the "bubble" – a 79% increase in about 4 years. A Pear Avenue home that sold in July 1997 for $450,000, sold in July of 2002 – again, in and out of the "bubble" for $770,000 – a 71% increase in 5 years. A home on Brookline Dr. that sold for $474,999 in July ’96, sold in August ’97 for $560,000 – an 18% increase in about a year. Another Brookline home that sold for $484,900 in August ’96, sold in June ’98 for $585,000 – a 21% increase in about 2 years. A Cornwall Ct. home that sold for $510,000 in May ’99, sold in September ’01 for $617,500 - a 21% increase in about 1 ½ years. A Ticonderoga Dr. home that sold for $490,000 in June ’97, sold in May of ’03 for $901,000 – an 84% increase in 6 years. A Tangerine Way home that sold for $492,000 in July ’98, sold for $633,000 in May ’03 – a 29% increase in 5 years. A Laurentian Way home that sold for $500,000 in June ’97, sold in March 2000 for $1,051,000 – a 110% increase 3 years – benefiting from a complete upgrading, and "the bubble."

A Lorne Ave. home that sold for $569,000 in August ’99, sold for $750,000 in July ’02 – a 32% increase in 3 years. A Trenton Ave. home selling for $640,000 in June ’99, sold for $800,000 in March ’03 - a 25% increase in about 4 years. A home on Sage Ct. that sold in August 2000 for $705,000, sold in May of ’03 for $775,000 – a 10% increase in 2+ years – as the "bubble" deflated. And, a home on Sesame Ct. that sold for $804,000 in February ’02, sold again in May of that year for $858,000. A very, very quick turn-around – but hopefully expenses were covered.

So --- I hope reading this has not been boring or tedious because of the repetitions. It is simply intended to demonstrate actual, real estate values over time in our area. As you know if you read my weekly website summaries, newspaper articles on this subject may tend to confuse, for they are often based on national or state activity, not our local Silicon Valley real estate activity, which has often, and for a very long time out-performed virtually all or certainly most markets in the nation.

What conclusions can be drawn from these statistics? It seems quite reasonable to say that the average Eichler homeowner in our area has enjoyed a 10 to 15% per year appreciation in their homes value, if they have lived in their home for 5 to 7 years. Perhaps more, if the home has been nicely upgraded, perhaps less if not much had been done. Will that continue? Again, as mentioned earlier, many homebuyers over the years have asked the same question. I hope that this rather unique view of prior sales of the same homes will provide some insight to an answer – an Eichler Insight!