On Monday I listed a 1976 ranch style patio home for $145,000.
The home is in a small community or sub-division of about 75 homes.
There are an equal number of ranch style homes and 1 and 1/2 story homes.
I studied two years of solds.
I noticed that 1350 sq ft ranch style homes are selling for the same price as 1950 sq ft 1 and 1/2 story homes. The 1 and 1/2 story homes have around 1100 sq ft on the main level.
Does that sound reasonable that a 1350 ft ranch would sell for the same price as a 1950 sq ft 1 and 1/2 story?
Replies
The cheapest lots here go for 145000.
how many br's & how many baths respectively ?
The 1350 ranch homes are two bedroom and two bathroom.The 1950 sq ft 1 and 1/2 story homes are both 3-4 bedroom and 3 bathrooms.
then i would assume they would not appraise at the same value
unless your market is tilted to retirees with a desire to live on one floor and foreego the extra br & bathMike Smith Rhode Island : Design / Build / Repair / Restore
Does that sound reasonable that a 1350 ft ranch would sell for the same price as a 1950 sq ft 1 and 1/2 story?
Yes, if you're a retiree looking to downsize to a low maintenance home with no stairs to climb. Decent ranch houses don't stay on the market long here. Supply and demand.
I think it's the tip of the iceberg. When the Boomers start to retire in large numbers the demand for ranch houses will expand rapidly.
edited to say: This retiree's typing hasn't gotten any faster either - started before Mike's post and took five minutes longer to say the same thing. :)
Edited 2/28/2008 10:16 pm ET by oldfred
I don't know what the homes sold for brand new but I'm guessing the larger home sold for more.
I don't know what the homes sold for brand new but I'm guessing the larger home sold for more.
They could have. They are sold the second time and on for "what the traffic will bear". It would be interesting to know who is buying the ranches in your area, and why.
Our area is losing jobs but gaining retirees. We've been keeping a watch on the local listings and I've noticed the nicer ranches sell fast even in this slower market.
When the Boomers start to retire in large numbers the demand for ranch houses will expand rapidly.
Interesting you say that. For years my neighborhood were all old people who owned their ranch style bungalows for 40+ years. They begain to die off, or sold out druing the real estate craze.
Then all yuppies moved in. Now, believe it or not, we have had two homes on our block sell to old people! Retirees.
Interesting.
Sorry for the derailment. I can say in my neighborhood, these homes sell strictly by the square foot. Occasionally you get a tad better price for the 3/2 versus the 3/1 (they love that 2nd bathroom)-----------------------------------------------------------------------------
"If you come to a fork in the road, take it"
The yuppies sure did some nice restorations in the Hyde Park area of Tampa.
FIL had some ranch rentals north of MacDill and sold them too soon, just before the boom.
On DI the ranches are being town down and big two-stories are going up. Wondering how long that trend will last. Probably as long as they continue to build skyscrapers uptown?
I think it's the tip of the iceberg. When the Boomers start to retire in large numbers the demand for ranch houses will expand rapidly.
You bet! I'm 38 yo planning on building myself a home and and have told wife NO STAIRS -- knees already kill me
It's the back with me,not the knees. Already feeling it when I horse staging around. I want to do my own maintenance as long as possible, and figure a one story will buy me some time.
Mrfixit,
In our 'hood in the Pac NW we have a similar set up, ranches, 1 1/2 stories & some 2 story homes, all sell in less than a month unless they are really "fugly" - which happens with bad additions etc...
Anyway the ranches sell for close to $380/sqft while the 1 1/2 &2's sell for about $340/sqft. but usually a lower $ amount than the larger homes.
There is a max a house will sell for in a particular area and if you can get it in this market - go for it. Using 2 years of solds may be misleading as prices we rising but are now falling...
Good luck.
Personally - I think you should check with a real estate agent. No, I'm not a realtor, nor do I really even like them.... Why? Because it's not entirely unusual for them to make the same amount for selling a new house, that we make building it - 6 months (or whatever) of hard work... Granted a REA may ride around with clients for 3 months who never buy a thing... OK - I'm on a tangent already.
Back to the topic. Really the sales within the last 6 months are then only ones that are relevant - OK - maybe a year max. Why? Local markets change... Sometimes rapidly.
To me though, your numbers sound skewed, unless, as Mike says there is a large influx of retirees that want 1 story homes.
From a new construction standpoint, not sure if there is much of any new homes going up in your area, but if there is, and it's not rural and a good market, I'll bet that there are many more 1.5 or 2 stories built than 1 story. Why? Because good finished lots are not easy to obtain in good markets, and more money can be made per unit on a larger 2 story house. In a bad market, it's anybodies guess.
As far as construction costs (which may not pertain to the current value of older homes) a 2 story is the least expensive per heated sq ft to build, 1.5 story is second most $/sq ft, and a 1 story is the most expensive ($ per sq ft) to build. (all things being equal like lot prep, and levels of finish). Why? Because the size of the roof and the foundation vs the size of heated sq foot delivered. Examples of building costs might be $80/sq ft for 2 story, $90 for 1.5 story and $100 for 1 story.
Also, FYI, a 1900 heated sq ft 2 story house with 2.5 baths and 2 car garage (for example) is always going to be cheaper to build per heated sq ft than a 1500 heated sq ft 2 story house with 2.5 baths and 2 car garage. Why? Because the money is in the bathrooms and the kitchen. Not as much the other areas.
In summary though, the value of any house is simply what the market will bear which in part is a function of what types of homes are in demand in that area.
Edited 3/1/2008 3:11 pm ET by Matt
Something else just occured to me... You are a real estate agent - aren't you?
Yes I am a Realtor.I think the concept of a 1350 sq ft home being equal in value to a 1950 sq ft home just makes for interesting analysis and discussion.That was the reason for the topic.Here's an example of what has happened thus far this week.I listed the house five days ago and I'm getting calls everyday from realtors.They call and say "can I show the house today at 5 PM?"And I say sure.Then we talk about the home. It's priced at $145,000.To one realtor I said "what do you think about the price?"She said "I don't know, I'll take a look at it before I say anything". Then she said "I do know I sold a larger home in that community for about that price"I respond by saying "yes I understand that but if you look at the comps you will see that it's priced appropriately"She says "Ok, I'll take a look if we get further along"This is how the process works and I just wanted to throw this out and see if anyone else had similar experiences.I thought about both style of houses and which one I would choose if I were buying.I think I would choose the bigger house.Just an opinion.
>> I thought about both style of houses and which one I would choose if I were buying.
I think I would choose the bigger house. <<
I guess a few downsides to owning a larger home could be - Higher heating/cooling bills- higher maintenance costs on the larger home- potentially higher taxes on a larger, higher appraised home
Obviously you have done your homework. I agree that it is an interesting phenomena that 2 houses of entirely different sizes and configurations are of roughly the same value. It will be interesting to see what the ranch sells for. I also have this vague remembrance that you live in a very slow market...
In the mean time, for the sake of discussion:
What was the DOM and sales prices for other ranches that sold (recently?) in this neighborhood?
Do the story and a half houses have a ground floor master? And, I guess obviously, the kitchen and a full bath on the first floor? Do you feel like there are a large number of retirees in your area looking for ranch houses?
BTW - DW and I are not that old but we don't want anything but a ranch... OK, maybe a story and a half with with a few infrequently used rooms upstairs.