Early Craftsman--1012 Walnut St, Alameda, CA
You'd think agents selling houses in Alameda would know the difference between the many architectural styles that grace our little town. Heck, in any town I'd expect a Real Estate Professional (tm), someone who makes a living helping people buy and sell houses, to have a modicum of sensitivity to building styles, or at least some knowledge of chronology. But that's not the way Marcus and Millichap rolls, evidently.
Today's property at 1012 Walnut Street has the following specs:
The one part of the listing I can't argue with, though, is the "perfect for owner-occupant" bit. That's because the only owner for whom this property makes sense is the owner who lives on the premises and doesn't mind paying twice the market rate for the privilege of enjoying one fourth of their house and sharing the yard with a handful of strangers; because this house sure doesn't make any sense as an investment property. Take a look at these numbers, provided by the owner:
"But what if you're living in the property?" you ask. Let's see.
Assuming the 2-bedroom unit is the "owner's unit", the numbers come out to ~$42,000 gross / $20,000 net income (remember you lost $1,200 a month by kicking one tenant out). This means you're paying $2,400 / month ($49,000 mortgage - $20,000 net income, divided by 12) to live in a 2-bedroom unit in a shared house (with shared yard) that normally rents for $1,200 / month.
What an incredible deal!
"But rents aren't always going to be this low!" you retort.
Maybe not, but they're not exactly going up either.
"But real estate doubles in value every 10 years!" you persist.
I suppose it all depends which 10 years you're looking at:
Today's property at 1012 Walnut Street has the following specs:
5 bedrooms, 4 bathrooms (4 units), 5,001 sqft, 3,132-sqft lot, built in 1896, MLS(r) #40434353, $849,000First off, as far as I can tell, the agent screwed up the details in the MLS(r) listing; the lot is ~5,000 sqft and the house is 3,132 sqft, not the other way around, at least according to Zillow and Trulia. This ain't Bayport, thank you very much. Second, if we are to believe the agent, this property is a rare example of a 1896 Craftsman, complete with bay windows and a second story like so many Craftsman houses of the era.
Detailed & well-maintained Craftsman with significant renovation-new roof, siding, paint, electrical, plumbing. [...] Large renovated Owner's Unit w/ 2 car garage & storage. All units sep metered/sep hot water heaters. Coin-op W/ D owned by landlord. [...] Perfect for Owner-occupant. Large backyard. [...]
The one part of the listing I can't argue with, though, is the "perfect for owner-occupant" bit. That's because the only owner for whom this property makes sense is the owner who lives on the premises and doesn't mind paying twice the market rate for the privilege of enjoying one fourth of their house and sharing the yard with a handful of strangers; because this house sure doesn't make any sense as an investment property. Take a look at these numbers, provided by the owner:
Unit 1: 1+1, $1,495 / moA 6% fixed mortgage on a $849,000 property with 20% down comes out to about $49,000 / year. So you're $15,000 in the red every year from the get-go.
Unit 2: 1+1, $1,050 / mo
Unit 3: 1+1, $1,000 / mo
Unit 4: 2+1, $1,200 / mo
Gross rent income: ~$56,000
Expenses (repairs, taxes, vacancy, etc): ~$22,000
Net income: ~$34,000
"But what if you're living in the property?" you ask. Let's see.
Assuming the 2-bedroom unit is the "owner's unit", the numbers come out to ~$42,000 gross / $20,000 net income (remember you lost $1,200 a month by kicking one tenant out). This means you're paying $2,400 / month ($49,000 mortgage - $20,000 net income, divided by 12) to live in a 2-bedroom unit in a shared house (with shared yard) that normally rents for $1,200 / month.
What an incredible deal!
"But rents aren't always going to be this low!" you retort.
Maybe not, but they're not exactly going up either.
"But real estate doubles in value every 10 years!" you persist.
I suppose it all depends which 10 years you're looking at:
If this property is supposed to double in value by 2015, it might want to get started soon.ZESTIMATE®: $873,50
- Value Range: $515,365 - $952,115
- 30-day change: -$2,000
Last sale and tax info
- Sold 06/17/2005: $856,000
- 2009 Property Tax: $11,866
Miscellaneous