$2.59 Million, Price of This Tiny Silicon Valley Cottage

[appalachiablue]

'Silicon Valley's housing crisis is so dire that this 897-square-foot Palo Alto home is selling for $2.59 million,'
Business Insider, 7/5/18

A small-yet-charming 897-square-foot residence in Palo Alto, California, could be yours for a cool $2.59 million.

The two-bedroom, one bathroom home, at 128 Middlefield Road, is yet another downsized abode selling for millions in Silicon Valley's overheated real estate market. With the famed Googleplex a mere 15 minutes away, and the hubs of other tech giants also nearby, the home and others like it are in high demand.

The last time this home sold was in 2008 for $899,000, according to Redfin. Now with an asking price of $2,589,000, the home is actually priced below the average for the upscale city of Palo Alto -- sort of. That price tag comes out to $2,886 per square foot, which is $1,430 above the average for the area.

>Click ahead to see what $2.59 million will get for the home's future owners.
https://www.msn.com/en-us/money/realestate/silicon-valleys-housing-crisis-is-so-dire-that-this-897-square-foot-palo-alto-home-is-selling-for-dollar259-million/ss-AAzA0Bk?li=BBnbfcL

[Frustratedlady]

1. This market is out of control. eom

[B2G]

11. The Bay Area housing market has been out of control for decades. nt

[wasupaloopa]

2. I use to have to go there for work. It was hard to

book a motel if you waited too long because of all the people living in motels.

[lapfog_1]

3. yeah... I've had oversea guests show up thinking that they can just "grab a room someplace"

I try really hard not to double over laughing.

And then we start looking in Livermore or Gilroy or something.

[smirkymonkey]

4. That is absolutely insane.

Is there really anyone dumb enough to pay that price?

[JI7]

5. it's all about location, but even it's very expensive

but i guess if people are actually spending that much in housing ......

[Lee-Lee]

6. It's all about policies that limit supply

These areas have very high demand. That calls for very high density housing. Apartments, condos, multistory multi family dwellings.

But if you look at the zoning and development regulations you will find that simply isn’t allowed for most of the available real estate. Where it is allowed it is not allowed in the density that makes it profitable because the inflated values mean that lot with that cottage needs to have 6-7 apartments or condos to be worth the effort.

And it’s that way because the people there want it. They all want their inflated housing prices protected- they paid stupid money and they don’t want any policies put in place that will lower it no matter how much it will help people.

[DeminPennswoods]

7. Watch Flip or Flop sometime

They work in CA and the prices they pay to buy their flip properties, then sell them for is amazing.

Meanwhile, watching the same show that's based in Atl, renovated homes are going for around 200k +/-.

[Hortensis]

8. The value's in the land. Period.

That's in spite of the fixing up, which illustrates clearly enough that replacing or expanding further on this lot is almost certainly not possible under current laws.

[bobGandolf]

9. Holy Moly, expensive is not the word...

Outlandishly over-priced, is more accurate. But...as long as people are willing....

[panader0]

10. I remember, back in the day, when the mine in Bisbee, Az, shut down.

The miners left and the hippies moved in. The old miner's houses, with hardwood floors and odd angles
sold for very little. My GF's house cost $3,000, the house next door was $850. (The land was leased from the mine.) The hippies gave way to
the artist types, Bisbee became a tourist/arty town, and those houses are now around $100,000.

[appalachiablue]

12. Homeless encampments have been growing esp. in the west

for multiple reasons, the extremely high cost of housing & living, the lack of mental health care service, other factors.



Jan. 2018, homeless encampment, Anaheim, Ca. in the greater LA area, residents facing eviction.

[Vinca]

13. That's an adorable, little house - as it should be for the price!

Wish I could transport it to the area where I live where it would cost about $175,000.

[dembotoz]

14. Sister in-law sold off her dead mom's place out there

Each kid got an absurd amount of money. Back in St Louis..
She paid off her house and gave it to her daughter.
Had a new house built, paid cash.
Took a couple really nice trips and still has cash left.

[shanti]

15. Potential buyers

look at this, and then drive 90 miles to Sacramento to buy more home for way less. A decent home in Sac is on the market for less than a week before it sells. We have Amtrak that makes daily runs to all parts of the Bay Area, so it's doable for many. My little 2/1 goes for over $200,000 now, and I paid $67,000. I could sell it, but rents here are skyrocketing too, so it wouldn't make good financial sense for me, as my mortgage is less than rent would be. In a couple of years though, I plan to sell and move elsewhere, somewhere cooler (temperature wise). With my luck though, the RE market will have bottomed out again.