Home Buying in Santa Clara>Question Details

rongermm, Home Buyer in Sunnyvale, CA

How would Duplex appreciate compared to condos, townhouse and single family?

Asked by rongermm, Sunnyvale, CA Fri Jul 19, 2013

You own lots for a duplex, but it seems it does not appreciate as fast as a single family home. Would it appreciate as a condo ? Thanks!

Help the community by answering this question:


It depends on location, use, condition, etc. Usually the single family homes appreciate the best. If the duplex is owner occupied, or can be owner occupied, I would rate it second best. I would put the condos in the third position. But it all depends on the property...
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1 vote Thank Flag Link Fri Jul 19, 2013
The big misconception about real estate is that "properties appreciate." When a property's price changes it's usually because of demand for the location, not the property (unless the structure was destroyed by fire, occupied by a celebrity, etc.). A specific property appreciating is just a symptom of the root cause - demand in the neighborhood.
That said, a property that comes with land - single family or duplex - will usually be in greater demand than condos and townhomes. As prices rise, the price of a single family or duplex will rise first and the value of condos and townhomes will follow after. But when a market declines, it's usually true that single family homes and duplexes will hold their value longer while condos and townhomes decline in value first.
1 vote Thank Flag Link Fri Jul 19, 2013
The percentage of buyers who are investors is probably higher for duplexes than single family homes. Investors are driven by cash flow more than a buyer who plans to reside in the home. Rental prices directly affect cash flow for an investor. Rental prices are likely to change quicker than sales prices. Changes in tax laws a more likely to affect an investor's choices than a person buying a home to live in. I believe all of this leads towards a duplex price being more volatile and following somewhat different timing than single family homes.

The ABAG push for local cities to build high density housing is going to change the ratio between single family and multifamily housing. With relatively more high density homes the demand for single family homes might grow quicker. If this push for high density housing made it so your duplex could be converted into a 4-plex, it could be a bonanza.

Santa Clara home values at http://julianalee.com/santa-clara/santa-clara-statistics.htm

If you look at the price per sq ft for Santa Clara Condos vs Single family homes the recent swings in prices have been more pronounced for condos.

Juliana Lee
Top 2 agent nationwide at Keller Williams Realty, the nations largest
Cell 650.857.1000

Over 20 years experience
Over 1,000 homes sold in Santa Clara County and San Mateo County
Web Reference: http://julianalee.com
0 votes Thank Flag Link Sun Aug 18, 2013
Real Estate depends on location and condition. Duplexes are great investment properties and do appreciated steadily. Condos depend on the size as well, a three bedroom condo will appreciate faster than a one bedroom. It sounds like you should speak with a local agent to help you determine which is a better investment depending on your financial goals and the price range you are in.

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0 votes Thank Flag Link Tue Jul 23, 2013
Excellent answers from the forum. And LOCATION always carries the highest value.

I would have to ask you what your goal is in purchasing real estate. Usually a duplex is purchased as an investment or a combined owner occupied and investment home. Sometimes two families will go in together. Duplexes tend to be located in zoning geared towards multi units and the price per square foot should be lower than a single family located in a single family zoning.

Single family homes tend to have greater demand, and condos with their prices being on the lower end may have more buyers due to their pricing.

Appreciation is somewhat across the board. If real estate appreciates 10%, a duplex at $700,000 should appreciate $70,000, a single family at $500,000 appreciates at $50,000, and a condo at $350,000 appreciates $35,000. As you see they all appreciated at 10% but because you purchased at a higher rate the return is higher. We can go into leveraging, interest and down payment, but this should give you an idea.
0 votes Thank Flag Link Fri Jul 19, 2013
Considering all three properties; Condo, single family and duplex are on the same block they will appreciate the same. If you are concerned about re sale value you had better hire a professional to inform you about the values in each location. Remember; location, location, location is still the huge factor in re sale value. Also work with someone who has represented both buyers and sellers in all three of these areas. Tenant law can and will be an issue in all properties if there are tenants however in a duplex there will most certainly be tenants. Good luck.
0 votes Thank Flag Link Fri Jul 19, 2013
Simple law of economics:

Supply and demand

NMLS 327086
0 votes Thank Flag Link Fri Jul 19, 2013
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