Prices have dropped, but not as much as this price would indicate. This is a short sale and is priced drastically under the market to attract buyers. The lowest price per square foot sale in the development in the past few months was $232/ft, followed by $241/ft and $242/ft. Those are the numbers a bank will be looking at when they do a BPO â€“ they will more than likely counter the price back up to close to market level. There are a few actives at lower prices per sq. ft., but none as low as the property you mention, which is currently at $206 sq. ft. There are also a few active REOs in the neighborhood, but their prices are not as low. If the subject house were evaluated based upon past sales, and using the sq. ft. numbers, itsâ€™ true price would be somewhere in the range of a minimum of $900,000.
Remember two things: (1) typically, the larger the home, the lower the price per sq. ft. You should not use larger home sq. ft. prices to validate prices on smaller homes. (2) Price per sq. ft. is only a ballpark way of doing comps â€“ to get a truly accurate price, you have to factor in amenities, condition, location, etc.
So â€¦ the market has not dropped that low as of yet. One very low short sale asking price does not a market make. As for San Ramon, the same factors apply.