Market Conditions in 94583>Question Details

Richwell, Other/Just Looking in 94608

Anyone knows about the $1.5m to $2m market in San Ramon? How are homes at Norris Canyon Estates and Roubion?

Asked by Richwell, 94608 Thu Mar 6, 2008

doing? Are builders offering special discounts? Anyone have the most recent sale prices for new homes at those developments? Thanks.

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The 3 remaining completed John Laing homes in Norris Canyon Estates, sold through a receiver 2nd quarter of 2010 for between $1,750,000 and $1,780,000. There were two homes "underconstruction", with significant completion to be performed that sold for between $1,100,000 and $1,350,000. These are very high end houses. The remaining undeveloped lots that were owned by John Laing have been sold to Toll Brothers, who has been the primary developer in Norris Canyon Estates. So far this year 2011 Toll Brothers is marketing and selling brand new homes in the development for between $1,400,000 and $1,950,000. This is a premier area of the tri-valley, that offers very large and attractive Estate type homes in a private quiet enclave tucked into a canyon. The few foreclosures continue to hold down pricing and offer significant value in the $1,200,000 to $1,300,000 range. Prices have a wide range depending on floor plan and upgrades. Many homes are over 5000 square feet, with nice size lots. It will be difficult to find a better buy in this price range anywhere in the tri-valley. Must see! and compare.
2 votes Thank Flag Link Wed Jun 1, 2011
Richwell,

First of all take everything you hear from real estate agents with a grain of salt. That being said, there is no $1.5 to $2 million market in San Ramon. That was a figment of people's imagination. The default rate on homes in Norris Canyon is through the roof and there are several that should be coming back on the market around $1 million in the next few months.

Furthermore, John Laing Homes declared bankruptcy, so here's what's going to happen. The homes in Roubion under construction will be liquidated and whatever the market price is, which will be between $1 million and $1.5 million. This will reset the price for every other home in hte area, because the Roubion homes and lots were far superior to any of the Toll Brothers ones.

After the homes in Roubion get liquidated the remaining lots will be sold, most likely to another builder. The builder that buys those lots will have a significantly lower basis, and will redesign the homes to be smaller and cheaper to build, so they can sell them for less and still make a profit. They'll probably target homes in the range of 2,500-4,000sqft and don't be surprised if prices are well below $1 million.

All this will take time, but this is what will happen. In the meantime we'll see more and more bank owned homes selling out there dirving down the prices. March 2009 had the HIGHEST default rate ever in the state of CA. This mean s we can expect a massive wave of bank owned homes hitting the market in about 5-6 months.

If you're realling interested in buying a $1.5 to $2 million home, wait for at least 6 months and then start to look in Alamo, Diablo Country Club, or other places that historically have proven to be the high end enclaves in the tri-valley. I grew up in San Ramon and I love it, but it's just not a $2 million community.
2 votes Thank Flag Link Fri Apr 17, 2009
Norris Canyon Estates is truely a unique development nestled amongst rolling hils on the west side of San Ramon. If you want an environment which feels like your far away from the hustle and bustle yet close to everything...this is the area for you. Many homes offer panoramic views of either the city or canyons. I'm a homeowner in the development and have loved living here. As a Realtor, I know the tri-valley San Ramon area very well and can tell you Norris Canyon Estates for the value is the best their is.
0 votes Thank Flag Link Thu Sep 13, 2012
As of June 2012, Summerhill Homes has purchased the last 40+ lots available at Norris Canyon Estates and has begun building, marketing and selling (6 in first month) 3600 sq ft to 4400 sq ft executive homes in the $1.1mm range and up. Toll Brothers continues to market and sell larger homes on larger lots for approx. $1.4mm and up. Both developers offer incredible homes for the value-- anyone looking to move in the tri-valley should look and compare-- both have model homes for viewing. 2 or 3 recent sales of foreclose/bank REO homes were in the $1.2 to $1.3mm range for houses approx. 5000 sq ft- all in need of some upgrading. There have been recent normal sales in the $1.5mm to $1.8mm range for homes over 5000 sq ft. with premium paid for John Laing homes (original Roubion). Norris Canyon estates once build out, will have approx 350 large homes, in a private gated enclave of San Ramon (unincorporated).....must see and compare.
0 votes Thank Flag Link Thu Jun 21, 2012
George,

There is no doubt in my mind that the homes out there will be under $1 million probably before the end of this year. I think it's a much better long term value than Windemere, but you need to wait to see what happens to the John Laing lots, the builder that buys those is the bulder you probably want to buy a house from.
0 votes Thank Flag Link Tue Apr 28, 2009
Steve

Thank you for a good information. You are one of few realtors advising potential home buyers to wait to purchase. Based on the amount of foreclosures in Norris Canyon combined with Roubion bankruptcy, do you believe the home in Norris Canyon will be selling under 1 Million in 2009 or 2010. There is one home already priced at 1.099 Million. With Windemere and Shapell selling their new 4000+ sq. ft home around 1 Million, is it a good bargain purchasing a foreclosed Tolls brother home for around 1 Million or is it a failed development where the price will keep on coming down?
0 votes Thank Flag Link Sat Apr 25, 2009
you might want to consider a cheaper price. look at this listing in norris canyon for only 1.15:

http://www.rockcliff.com/Search/PropDetail.aspx?listingID=12…
0 votes Thank Flag Link Thu Apr 16, 2009
I am not sure if this will affect your thoughts on purchasing, but one thing I can say about both neighborhoods because I have two close friends that live there is that it is VERY WINDY, there are drainage issues with the lots because most of them are not flat, and in general it's a bit far from any convienent shopping.
0 votes Thank Flag Link Thu Apr 16, 2009
Agreed. The formula is probably too strict for some people. But most people, as we have seen, strech their dollars, buying new cars, electronics, etc and the most house they can get. Therefore saving very little. So in your case, I agree you can proabably afford more house. But we have just witnessed a very sad and serious housing crash b/c people were over extended.I think it is better to only spend 2-3 your gross income on housing, like you said, and that means the average San Ramon family can only afford a 360K home since the average household income is around 120K. (of course people have savings, larger downs, etc) On average, this would the formula. and perhaps you can argue that it is too restrictive so may be 4 x gross that would be around 480K. I think we will see average prices settle around there somwhere.
0 votes Thank Flag Link Tue Mar 11, 2008
John,
All I knew about is the cost of housing should not exceed 1/3 of gross income, using this formula 1 mil house with 80% mortgage requires 200K or less annual income depending on interest rate. Even this formula is too general to apply to everyone. Cost of living is such a flexible thing, doubling it or cutting it in half doesn't necessarily change quality of life drastically. In the things you list, besides pre-school, I don't see any needs of private schooling for my kids in San Ramon. More expensive cars? I am fully confident my two Toyotas will run another 10 years without any issue. Following your formula, an average family would never be afford a house in bay area, even house price drops another 20%. Maybe time for a change?
0 votes Thank Flag Link Tue Mar 11, 2008
Jia,
Income x 2.5 is the formula used for decades to measure affordability. 500K x 2.5 = 1.25 million home. I went under slightly to account for the increased cost of living overall (private school for kids, more expensive, cars, groceries,utiliites, cell phones, landscaping costs etc) compared to the previous decades this formula was used. Sure, you can get fancy and strech your budget and qualify to own homes more expensive than that. But this is how banks have been measuring ability for the last 60 yrs. The 5 y rs that they got away from this, will lead many of those banks now to go bankrupt. (see any business news on tV) and many homeowners will lose homes b/c they did not follow this rule.Plus, don't you want to save $$ for a rainy day?

In general you are correct, property taxes are tax deductible. You will get a percentage of it back by paying less taxes; but no more than the percentage of your tax bracket, in general. However, the whole argument is mute, since AMT is hitting more and more tax payers; the AMT deminishes the effects of tax deductions overall. Take Care
John
0 votes Thank Flag Link Tue Mar 11, 2008
I have been watching the 24/680 corridor and San Ramon seems to be getting its share of foreclosures and price cuts. There is also a lot of new construction for rent compared to other areas. I would proceed with caution in San Ramon.
0 votes Thank Flag Link Mon Mar 10, 2008
Mr. "knowledgable" John, do you know property tax is income tax deductible? And one needs to earn 500K a year to afford a 1 million dollar home??? And your spreadsheet? No, thanks, I'd rather use something more reliable.
0 votes Thank Flag Link Mon Mar 10, 2008
Compared to historical norms and incomes, these homes are very over priced. You've been warned. Do not buy.(unless you have multimillion in assests and can afford to lose a few $$) Consider this: the 1.6% property tax on a 2 milion home is around 35K. Pretax that would equate to around 58K. You would need $5000 per month in income just for property taxes. For a one million dollar home, you would need around 2500/month in income, just for taxes. To easily afford a one million dollar home with 200K down, you would need to earn around 500K/yr with the average 2 kids, 2 car "normal expenditrure" family. Good luck
I can send you the spreadsheet with all utilities, taxes, other expenses which show this. John
0 votes Thank Flag Link Sun Mar 9, 2008
There are currently 11 homes for sale in the $1.5M to $2M market in San Ramon. Several have large lots. I found one property that is on a 17,900sf lot that's a bankruptcy sale. Email me to make an appointment to see this one. Great location, house and lot. I have lived in San Ramon since 1987 and know the area well.
Web Reference: http://www.JoanneLiotta.com
0 votes Thank Flag Link Thu Mar 6, 2008
It's pretty slow at the moment. There have only been 2 homes sold in this price range in San Ramon this year and both are in Gale Ranch, not Norris Canyon or Roubion. There are a few Pending right now but only one is in the area you mentioned (Norris Canyon Estates). Plenty for sale though.

If you want full details, let me have your email address and I'll send them to you. I believe I can negotiate some good deals with Toll Brothers and John Laing homes for buyers, provided tey are not already registered there of course. Let me know if you need any help.
0 votes Thank Flag Link Thu Mar 6, 2008
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