Two new homes have joined the $2MM+ club. On Friday I profiled a mansion that seemed like a decent deal due to its community and location.

Worth your $2MM in the Highlands
2209 Canyon Rd
Listing Price: $1,999,000
5,586sf
Mountain Location

Let’s see if the following homes deserve the same praise. The following is located a bit south of the 2209 Canyon Rd. property and also part of The Highlands community. It is 1,422sf smaller but 0.27 acres larger.

300 Whispering Pines Dr.
Arcadia, CA 91006

Price: $2,988,800 ($718 per sq. ft.)

• Beds: 5
• Baths: 4.5
• Sq. Ft.: 4,164
• Lot Size: 0.71 Acres

It may have a bigger lot but a large portion of it is unusable; as seen below.

Would you pay $718 per sq. ft., or a $1MM premium over over the last Friday’s property? Perhaps the sellers believe their price is justified by the view:

VIEW! VIEW! VIEW! 270 DEGREE SENSATIONAL PANORAMIC VIEW OF CITY LIGHTS.

If you think that’s a wishful asking price, then the following seller is a big dream. So big, in fact, that $2-3MM is chump change compared to this home on Norman:

239 W. Norman Ave.
Arcadia, CA 91007

Price: $5,500,000 ($579 per sq. ft.)

• Beds: 5
• Baths: 7.5
• Sq. Ft.: 9,491
• Lot Size: 0.47 Acres

Absolutely one of the finest estates in Arcadia.

9,491sf home on half an acre?? Does Arcadia not have municipal ordinances and codes to prevent property owners from overbuilding on their land? Take a look below if you want to know what I’m talking about.

The photos only show a pool in the backyard because that’s all there is… And it doesn’t stop there. If you cannot expect privacy in Arcadia for $1MM or $2MM, what about $5MM+?

Is that a neighbor peeking at you from their second floor window?

So what does it take to sell a home in today’s market? I am regularly challenged by associates who say $350-400 per square feet is “normal” for a home in Arcadia. They can’t imagine anything selling for under $300/sf. I don’t blame them since a quick search on Redfin and NeighborCity will reveal that very few homes are priced for under that figure.

Of course, we all know that home values are not determined by listing prices. It is based on actual sales data. Duh! Take for example the following property we profiled 2 months ago:

Back House REO

Purchase price: $1,500,000 ($354/sf)
Asking price: $1,169,000 ($277/sf)
Sales price: $1,041,000 ($246/sf)

1233 S 6th Ave
Arcadia, CA 91006

• Beds: 4
• Baths: 3.5
• Sq. Ft.: 4,227
• Built: 1989

Sales price: $1,041,000 ($246/sf)

When REOs like these set a new low in terms of price per sq. ft., it will directly affect its neighbors and surrounding communities. Purchased in 2005 for $1,500,000, it took only 3 years to wipe out $500k in equity; of which $300k was the buyer’s down payment!

Send this post to all your skeptical friends, family and coworkers who argue that the “award winning” Arcadia School Disitrict is enough to prop up home prices. Although price per square footage isn’t the best way to value a home, it gives us a quick and dirty reference as to where home sales are heading (especially during bubble cycles).

As of right now, anything decent for under $300/sf is getting snapped up very quickly but I fully expect us to see more high-$200/sf listings after this Summer/Fall season. Do I sound crazy?

Today’s seller is facing the cold hard reality of our housing crisis and has been forced to reduce his listing price by 26.6%. We originally profiled this property back in March and many of you guys agreed that it was ridiculously overpriced:

Can’t See the Forest for the Trees
Original listing price: $1,350,000 ($614/sf)

38 E. Forest Ave.
Arcadia, CA 91006

New listing price: $990,000 ($450/sf, -26.6%)

• Beds: 4
• Baths: 2.75
• Sq. Ft.: 2,200
• Lot size: 7,570 Sq. Ft.

That’s a $360,000 price reduction! I’m not entirely surprised though because this “$1.35MM” home was situated right next to the 210 freeway, Santa Anita Ave. off-ramp.

For a home located south of Foothill Blvd. and next to the freeway, the price will have to come down a lot more because who in their right mind would spend nearly $1MM for this? If you value it at $300 per square foot, then this cookie cutter home would be worth only $660,000; $350/sf would give us $770,000.

Would you buy this property for $770,000? It might be worth a try because according to the listing,

SELLER’S IS VERY MOTIVATED. BRING ALL OFFERS.

For those who commute into Downtown, Pasadena represents a likely alternative to Arcadia. As apparent by the following profiles, you will get more house for the money but a highly rated school district isn’t something you’ll be buying into.

Pasadena School Rankings vs Arcadia School Rankings

For ~$750,000, you can choose from these 3 homes in Arcadia:

812 Victoria Dr
Arcadia, CA 91007

Price: $748,000 ($596/sf)

• Beds: 3
• Baths: 1
• Sq. Ft.: 1,256
• Lot: 7,675 Sq. Ft.

443 Las Tunas Dr
Arcadia, CA 91007

Price: $750,000 ($735/sf)

• Beds: 2
• Baths: 1
• Sq. Ft.: 1,020
• Lot:     0.26 Acres

209 S Third Ave #A
Arcadia, CA 91006

Price: $759,000 ($324/sf)

• Beds: 3
• Baths: 3
• Sq. Ft.: 2,340
• LOT SIZE:      Attached, Townhouse

You can definitely expect to get more living square footage and land in Pasadena. Unfortunately, there exists many neighborhoods that you will want to stay out of (for safety reasons):

745 E Rio Grande St
Pasadena, CA 91104

Price: $749,000 ($483/sf)

• Beds: 3
• Baths: 2.75
• Sq. Ft.: 1,550
• Lot:     8,208 Sq. Ft.

PROPERTY TYPE:    Single Family Detached, California Bungalow

1700 Whitefield Rd
Pasadena, CA 91104

Price: $750,000 ($250/sf)

• Beds: 6
• Baths: 2
• Sq. Ft.: 3,004
• Lot:     8,550 Sq. Ft.

PROPERTY TYPE:    Single Family Detached, California Bungalow

736 Bonita Dr
South Pasadena, CA 91030

Price: $759,000 ($482/sf)

• Beds: 2
• Baths: 1.5
• Sq. Ft.: 1,576
• Lot:     5,135 Sq. Ft.

PROPERTY TYPE:    Single Family Detached, Mediterranean

Temple City is a small community-city bordering Arcadia and even crosses it in some areas. As seen on the map below, it is a little less than half the size of Arcadia,  For all you TC Rams, I’ve highlighted your city in green.

Today let’s look at what $630,000 will buy you in each city.

36 Alta St #b
Arcadia, CA 91006

Listing Price: $628,000 ($458/sf)

• Beds: 3
• Baths: 2.5
• Sq. Ft.: 1,372

This is your typical Arcadia stucco’d box townhouse. You basically have no backyard, no driveway and probably share a wall with the unit next door. For $628k, one can argue that it’s a great price for a newly built property (2007). Unfortunately, the market says otherwise because this particular unit has been sitting on the market for 161 days.

These are popular because many buyers would prefer to not spend the time and money maintaining a yard. Unfortunately, this property comes attached with a monthly $147 HOA fee. So I guess you still end up paying for the maintenace.

5760 Camellia Ave
Temple City, CA 91780

Listing Price: $629,000 ($486/sf)

• Beds: 3
• Baths: 2.5
• Sq. Ft.: 1,295

For this atypical Temple City home, you lose a room and restroom but gain 6,000sf in land. It is a 1931 custom built brick home and located near the corner of Temple City Blvd. and Las Tunas Dr. It is blocks from the Arcadia/Temple City border but that distance is the difference between a single family home and new townhouse.

Obviously, I’m not claiming these are comparable properties. But given $630,000, would you go for an older single family home or the newer attached product? Aside from the different school districts, Temple City and Arcadia basically share all the same amenities in the immediate area.

Holy cow! I can’t keep up with all the new $2,000,000+ listing that keep popping up every other day. This will be an interesting Summer as all the folks who can’t afford their McMansions anymore try to pawn it off to a lucky clueless buyer. Heck, some of them will even try to make a buck or two during the process….

2428 S 2nd Ave
Arcadia, CA 91006

Asking price? A whopping $3,188,000 (478/sf)!

You are in fact getting a lot of home for the money:

• Beds: 6
• Baths: 6.5
• Sq. Ft.: 6,671

It is possible to squeeze 3 families into a home this size. Unfortunately, similar to other million dollar plus homes I’ve profiled, privacy is not something $3MM+ will buy you. This house is sitting on a tiny 1/3 acre:

In fact, if you carefully look, only a 5’+ wall separates you from the neighbor’s backyard (also another McMansion).

At $3,188,000, this seller want to make a cool $500,000 on his investment.

SALES HISTORY

Date Price Appreciation
May ’91 $340,000
Oct ’96 $80,000 -23.6%/yr
Nov ’04 $713,000 31.2%/yr
Nov ’06 $2,688,000 92.5%/yr

This is ridiculous. Even in extraordinarily pricey areas, $3.2MM can buy you more than a over-sized home. Take Newport Coast for instance. You’re money won’t go too far in this community, but dollar for dollar you at least get a view of the Pacific Ocean.

6 Dolomiti
Newport Coast, CA 92657

Today we have two homes. They are both similar in size, acreage and condition. In this case, it’s the location and school district which will determine what their true market is. Which one would you buy?

5308 Garypark Ave.
Arcadia, CA 91006

Price: $450,000

Address may say Arcadia but this property is actually located within El Monte’s school district. In addition, the location is far from desirable. Check out the map:

Records show that the owner(s) bought this property in 2005 for $560,000 at… you guessed it, 100% financing. This home is definitely overpriced and not worth anymore than $300,000 to $350,000. Given that we have 2-3 years of decline to go, this short sale will most likely go back to the bank.

This is one property that will not benefit from sitting on a golf course.

928 Victoria Dr.
Arcadia, CA 91007

Price: $799,000

Here we have a similarly sized home in a completely different setting. You get:

• Arcadia School District
• Desirable community of Peacock Village
• The heart of Arcadia: Nearby is the Santa Anita Westfield Mall (soon to be The Promenade), racetrack, Pavillions, 99 Ranch and a host of other shops amenities.

In late 2006, this home was purchased for $650,000. After some remodeling and 2 years later, the owner’s now want to make $150,000 . Unfortunately, they bought during the peak of the housing bubble and I predict many price reductions to come. They will be lucky to break even on this property after paying the sales commission!

Call me crazy but asking for $665 per square foot on a 1,200sf home is definitely not priced to sell.