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January 23, 2012

Gung-Ho Buyers Hit Mission Dolores


Back in the mid 2000s, it was quite common for bidding wars to culminate with one or two buyers offering way, way beyond the list price because they really wanted that property—and the home was priced low to allow for overbidding. The underpricing strategy is certainly making a comeback, particularly with respect to the Mission Dolores area.

The most recent incident occurred at 3668-70 18th Street, between Dolores and Guerrero (see photo). Right—the block with Tartine, Bi-Rite and Delfina. The two-unit property with an unwarranted third, garage-level unit was listed at $995,000. Though the building was in very sound condition, kitchens and baths needed updating, and the exterior was certainly nothing to write home about. However, 21 sets of buyers wrote offers, and the winning bid turned out to be $1.3M.

And then there was the sale over at 3883-85 20th Street, which borders the south end of Dolores Park:

One of the two units was basically down to the studs, requiring substantially more money to complete the job. List price was $1.3M, and the sale closed in November for $1.5M.

Chalk up this somewhat frenzied activity to the fact that Mission Dolores continues to be a hot, hip neighborhood for TIC/condo/multi-unit buyers who want the proximity to the 18th Street/Valencia corridors, Dolores Park, and public transportation (not to mention tech shuttles to the Peninsula). Buyers really will go nuts for these things, and they obviously will respond in droves when a property is purposely priced low to attract interest.

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