Home Buying in Palo Alto>Question Details

Douglass Mcn…, Home Buyer in Palo Alto, CA

Is there high-demand for these DR Horton, Palo Alto Elevation homes?

Asked by Douglass Mcneil, Palo Alto, CA Fri Mar 8, 2013

Was not targeting this type of home...but given how crazy Palo Alto market is, I am seriously considering...

Question: Is there a lot of interest in the buyer community for these homes? These homes don't seem to be flying off the shelf...but perhaps DR Horton is tightly controlling the release/inventory of these homes.

When I evaluate, this is what I see:

Pro's: Palo Alto schools, walking distance to Fairmeadow/JLS, walking distance to other amenities (Mitchell Park, new library), new construction features, relatively low $/SF
Con's: super-dense housing (tiny lot, 3-floors, little/no outdoor space), potential traffic challenges with shared retail space apartments, noise b/c Alma/train tracks, limited/no rennovation option

2nd question: Would these type of homes appreciate worse than traditional homes in Palo Alto? Given the very little land and limited options to renovate/improve the home


Thoughts?


Thx

Help the community by answering this question:

Answers

5
Juliana Lee,MBA’s answer
The easy question first ... homes near the train tracks were hit by the downturn in the economy first and were slower to recover but they have recovered. Also, town home developments have done well in Palo Alto. Statistics for town homes are strongly affected by large new developments so the bumps are not the same as for single family homes but the overall appreciation is comparable.
http://julianalee.com/palo-alto/palo-alto-statistics.htm

The greatest issue affecting a community development is how well the HOA is run which in large part depends upon who moves in. Nearby the Hamlet development on El Camino Way was very attractive when it was built. It went through a period of postponed maintenance. The affect was devastating. They finally seem to be working their way through the problems but it has taken many years. The Hamlet had many large exposed wooden beams and railings which need regular maintenance. The DR Horton homes should not be nearly as susceptible to delayed maintenance.

Across Alma many of the single family homeowners are very concerned about the high speed rail. There is a good chance that when or perhaps even if the high speed rail eventually comes it will bring changes to the railroad crossings which would reduce noise. Although elevated tracks are opposed by many, eliminating at grade crossings would eliminate the need for the train to blow its horn.
http://julianalee.com/blog/community/high-speed-rail-road-cr…

The other item you didn't mention is the large nearby apartment complex. Unforeseeable changes in it could affect the DR Horton homes.

Many new townhomes have been built near the DR Horton Elevation Homes. New homes drive up comparables and expectations. The area has been headed in a good direction.

In general brand new homes command a premium. When you sell your home it will no longer be brand new. On the other hand the HOA will have established its credibility.

Your concerns about the limited space should not be ignored but if you look at the Echelon development near E Meadow and 101 you'll see that a lack of open space in the community hasn't been a problem. They don't have mixed use though. Many younger people attracted to Palo Alto like city life. Downtown Palo Alto is quite desirable, California Ave seems to be headed that way also. Changes in the basic community around the Elevation homes are probably far in the future.

Juliana Lee
650-857-1000
Top 2 agent nationwide at Keller Williams

Over 30 years experience
Over 1,000 homes sold in Santa Clara and San Mateo counties.
.
Web Reference: http://julianalee.com
0 votes Thank Flag Link Mon Apr 1, 2013
Some of your questions are based on personal preferences so it's hard to answer without getting to know you better.

As for appreciation potential, there are different trajectories for new versus older homes. So, depending on your time frame, there would be different appreciation rates.

In terms of demand, DR Horton priced their homes really well to the market. They're selling regularly, without huge mob scenes, which would be more suggestive of underpricing.
Web Reference: http://www.archershomes.com
0 votes Thank Flag Link Tue Mar 26, 2013
I like to look at the data. Everyone has an opinion, and frankly both sides of any point can be well argued, but the data speaks for itself.

So I ran the numbers using a statistics reporting module of the MLS. Looking only at two communities, Palo Alto & Menlo Park I asked the following questions in an attempt to get real data on your questions

- how has the average value per sqft of new home construction, homes built after 2008 compared to homes built before 2008?
- how has the average value per sqft of homes built on lots 6500sqft or less compared to homes built on 6500sqft to 1acre?
- how has the average value per sqft of homes built AFTER 2008 AND on lots SMALLER than 6500sqft increased. these new homes on smaller lots are most likely to be the new builder home communities you are asking about

I published the results on my website at http://www.StuCarson.com/PaloAltoNewVsOld

The results are fascinating! New homes on small lots have increased in value per sqft faster than any other segment looked at. Next fastest were any homes built since 2008. And third fastest in appreciation were homes on lots between 6500sqft & 1 acre.

BTW think can't benefit from having a Realtor help you buy a home from a builder like DR Horton? Visit my website and think again. An case can be made that more than any type of Real Estate transaction that's where you most need someone representing your best interests. More on that topic at this web page http://www.JustNewProperties.com

here are 6000+ Realtors in Santa Clara County alone. As with any occupation, law, medicine, etc... all Realtors are not equal in experience, skills, training and effectiveness. Take the time to learn about a few Realtors and interview a couple. Hire the best. Why not?

resume http://stucarson.com/AboutTheTeam

references http://stucarson.com/testimonials

Call or email me so I can learn more about what you are looking for in the ideal home & location/community. Then let's go find and buy your home at the lowest possible price and with the best possible terms and conditions.

Stu Carson
408-209-0849
http://www.GetRealRealtor.com
http://www.JustMyProperties.com
0 votes Thank Flag Link Fri Mar 8, 2013
I agree with everything you are saying. Horton does seem to release slowly and the other ones have all sold, but given that it takes 1.5 million to buy a tear down the buyer must have a compelling reason to want to live in PA. If living here is your goal, then I think these homes are a good option. I don't think I am the only person who would rather live by the train than by 101, which was the previous option for a new home.
As far as appreciation land appreciates and structures depreciate, but you can always remodel the inside if it becomes dates, and you would be starting by by buying a home for significantly less than other SFR.

Marcy Moyer
Keller Williams Realty Palo Alto
marcy@marcymoyer.com
DRE 01191194
650-619-9285
Web Reference: http://www.marcymoyer.com
0 votes Thank Flag Link Fri Mar 8, 2013
Price and appreciation is relevant. When prices go up, they go up for all homes and when it goes down, they go down. Location always is the key to how much a property appreciates. When the market gets too high priced, then the entry level properties become in high demand due to those who can afford them.

As for home style that is a personal taste. Some people are too busy to take care of a lot of land and prefer a lower maintenance property. Some people don't want the responsibility of taking care of a yard and want the convenience to public transportation.

We are seeing heavy demand in all properties, even in new construction. The builders do have a plan as to how they release properties and each release usually has a higher price tag.

Have an amazing day.
Web Reference: http://www.terrivellios.com
0 votes Thank Flag Link Fri Mar 8, 2013
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