When looking at a potential house to buy, it’s as important to consider what a broker doesn’t show you as it is to look at what they do show you. 2061 Ashton is a case in point. (click to enlarge images)

First, there are no photos of the front of the home contained in the listing. This is strange, since looking at the Google Street View of the home, it doesn’t look all that bad. Maybe not the most dramatically appealing home, but good enough for a listing photo. We have to wonder why the listing agent omitted this important piece
of information.

Second, in taking a quick peek at the street the most glaring feature is the giant power station just down the street. This is bad, and further compounds the question as to why the listing agent would omit the front of the home, since it’s logical to assume a potential buyer would check this out on their own.

The home itself seems fine, a smaller, reasonably updated house close to Alameda de las Pulgas in Menlo Park and in a great school district. But for under $1 million, this could be a good starter home … if of
course we can figure out whether 2061 Ashton is a
DEAL OR NO DEAL?

Address: 2061 Ashton Ave., Menlo Park, CA 94025
(MLS Listing)
Status: ACTIVE
Bedrooms: 3; Bathrooms: 2
Living Space: 1,580 sq ft
Lot Size: 6,000
List Date: 6/18/2009
Original List Price: $999,000
Current List Price: $999,000
MLS no.: 80939201

Real Estate Agent Comment: WEST MENLO TOP REMODEL: RE-DO COMPLETED IN 2002 WITH MANY COMPLIMENTS THAT STRIKE THE EYE: STAR STUNNING CONTEMPORARY IN BEST COUNTY ALAMEDA AREA EXTRA AMPLE FRONT + REAR YARD WITH BEAUTIFUL LANDSCAPING; GREAT ROOM IS HEART OF HOME WITH WELL APPOINTED KITCHEN.

DEAL or NO DEAL?
Comment below and tell us what you think!

This post first appeared in the February 2009 edition of Cirios Trends.

This being the inaugural edition of Cirios Trends, we’re giving our loyal readers two houses for the price of one. Let’s travel about 30 minutes south from San Francisco to Google Park - err, Menlo Park - where the tree-lined streets are paved with Internet gold.

The two houses below are on Hermosa Way, across the street from one another. We believe both owners are a touch too optimistic about finding a buyer at their current asking prices. The homes were listed during the same week back in September, and now appear engaged in a my-overpriced-house-is-less-overpriced-than-your-overpriced-house price war. Hard to imagine either owner is going across the street to borrow a cup of sugar. Here we have a microcosm of the current housing market - too much supply, each seller trying to undercut his neighbor.

Neighborhood Overview: Menlo Park is a very desirable location because of its great schools and proximity to major Silicon Valley job centers (including Google’s massive campus in nearby Mountain view). These factors, coupled with its mild climate, have ushered in an era of unprecedented prosperity for this once middle class town.

Property values began to falter in 2001 as the dotcom bubble burst, but the emergence of Google almost single handedly reversed the market’s fortune. Many freshly made millionaires bought older homes, tore them down and erected McMansions of their own. Now, with many residents seeing their paper wealth evaporating on Wall Street, Menlo Park property values are starting to come back to earth.

House #1: 800 Hermosa Way, Menlo Park, CA 94025

Original List Price: $4,250,000
List Date: 9/7/08
Current List Price: $3,675,000
Previous Sale: $2,900,000
Previous Sale Date: 3/12/2004
Estimated Down Payment: $735,000
Estimated Monthly Payment: $22,622*
Bedrooms: 5; Bathrooms: 4+
Liv. Area: 5,350 sqft; Lot Size: 21,816 sqft (0.5 acres)
Positives:
+ Large house, more living area than most comps
+ Upgrades nearly throughout (except kitchen)
+ Close to all amenities, schools, shopping, freeways
Negatives:
- No sales >$3 million in the area in the last 3 months
- Many high end homes listed, lots of competition
- 5,000 square may be too much house for some buyers
Value Analysis:
The world of potential buyers for this house is very limited, he or she would need to have the income and job security to afford a $22,000 monthly payment. Many comparable, if not quite as large, homes are available for as much as $1million less. The comp sale below is inferior, but a better indication of demand in the area.

HOUSE #1 CIRIOS VALUE: $2,950,000
Over-listed Amount: $725,000 (24.6%)
—-
Comparable Sale: 345 Vine St, Menlo Park, CA 94025
Sale Price: $2,420,000
Sale Date: 12/16/2008
Bedrooms: 5; Bathrooms: 4
Liv. Area: 3,220 sqft; Lot Size: 8,350 sqft (0.2 acres)
Comparison to Subject: Inferior

House #2: 777 Hermosa Way, Menlo Park, CA 94025

Original List Price: $4,495,000
List Date: 9/5/08
Current List Price: $3,975,000
Previous Sale: $2,295,000
Previous Sale Date: 6/19/2002
Estimated Down Payment: $795,000
Estimated Monthly Payment: $24,469*
Bedrooms: 4; Bathrooms: 3;
Liv. Area: 3,302 sqft; Lot Size: 21,708 sqft (0.5 acres)
Positives:
+ Excellent condition, inside and out
+ Updated kitchen
+ Reasonably sized home that conforms to the area
Negatives:
- No sales >$3 million in the area in the last 3 months
- No exceptional features, except the kitchen and lot
- Significantly over-listed, smaller than its listed neighbor
Value Analysis:
The world of potential buyers for this house is also very limited. House #1 is larger and newly upgraded, and should sell for more than the subject. The subject’s conformity and smaller size could attract more buyers looking for an easier home to maintain. The comp sale is inferior, but more similar to the subject than House #1.

HOUSE #2 CIRIOS VALUE: $2,700,000
Over-listed Amount: $1,275,000 (47.2%)
—-
OVERALL COMMENTS:
Both owners are faced with a similar dilemma: Do I lower my asking price until I get an offer, or take my home off the market and hope for a rebound? Ultimately, both sellers need to be more realistic with their expectations of how much their homes are worth.

* Mortgage payments are based on the house being bought at the list price with 20% down and a 7.0% 30yr fixed loan, monthly tax cost included.