|Palo Alto Online Real Estate
Uploaded: Thursday, April 19, 2012, 4:34 PM
Pssst ... Have I got a house for you!
Super-secret, super-high-end houses for sale
|Have you ever strolled by a palatial home on a gorgeous lot in Old Palo Alto or Crescent Park and wondered who owns it, what it looks like inside and fantasized about how much it would cost to make it yours?
Just walk on by and keep wondering because, unless you are a qualified buyer in the market for one of these high-end properties that can sell for as much as $10 million and up, you'll never know. You won't find this caliber of real estate on the Multiple Listing Service (MLS), websites such as Zillow or Redfin or advertised in the "Sunday Open House" sections of the paper.
Houses like these are typically bought and sold privately through a cadre of real-estate agents in Palo Alto who know the market, who to market to and, most importantly, how to get the job done without exposing their clients' addresses, floor plans and financial lives to nosy neighbors and looky-loos.
"The private market has always been prevalent in Palo Alto," said Miles McCormick, a founding agent at Keller Williams Realty, who reports having three such properties listed for sale. "They're private for a specific reason or set of reasons. The sellers are well-known and/or they aren't comfortable with the world knowing what their plans are or what their living situation is."
McCormick adds that publicly listing a "trophy property" -- one that is well-known or a fabulous house or a large piece of land -- could result in as many as 1,000 people going through the house in the first week on the market if a broker tour and open house were held.
"It would be completely overwhelming," he said.
Michael Dreyfus, CEO and sales broker with Dreyfus Properties, is currently under contract to privately sell a large Old Palo Alto estate, which, if it goes for asking price, will be the most expensive house ever sold in Palo Alto. The address and price are top secret.
"I want to protect my clients and protect their privacy. There is nothing more sacred than your house," he said.
In a world in which information about what you ate for breakfast, your job title and which friends you are currently partying with is voluntarily provided via sites such as Twitter, LinkedIn, Google and Facebook, privacy, especially around real estate transactions, for a certain segment of the population is becoming increasingly more important. Some are worried about security issues. Others don't want their friends, business associates or even their own kids to know how much they paid for their houses.
Dreyfus said that his company began developing its private marketing program in earnest when a single woman who had purchased property was unnerved after her home address was exposed on a real estate website. He also tells a story of a woman who recently bought a high-end home and had a stranger approach her at a social event to tell her that she loved her master bathroom.
"Nobody likes that. It's creepy," he said.
While agents agree that both buyers and sellers can benefit from the privacy of "off-market" listings, refraining from advertising them can limit the potential pool of buyers. There is one high-end property in Palo Alto that, while being marketed off the MLS, is being discreetly advertised with the address and price on the agent's website.
Hanna Shacham, an agent with Coldwell Banker, has listed 2051 Waverley at $11,495,000. The 2,651-square-foot house was built in 1929.
"It is in the historical Category Four. I believe this is the least stringent category out of the four, where structures can be demolished under certain conditions, but buyers should verify with the city. The seller is working with the city now to remove (the property) from the Category Four."
The value is clearly not in the house, but in the lot, at 26,344 square feet, and the location, directly across the street from Steve Jobs' family home, making it a rare opportunity for the right buyer, according to Shacham.
"It is a legendary locale," she said.
How do agents go about marketing properties like these without the traditional methods of MLS listings, broker tours and open houses?
"Instead of the nuclear-bomb approach, we're doing guided missiles," Dreyfus said. "It used to be that when we did private marketing, we just emailed other agents. Now we have developed a whole program around it: websites that are password-protected, mailers with no addresses or prices that are only sent to groups we identify. We're also marketing directly to people who we know have had recent liquidity events."
"I'm on the phone all the time," McCormick said. "I subtly market. I call other agents and say, 'I have this; here's the size; here's the style; this is the neighborhood; this is the price.'" Once he is confident that the property is a good match for potential buyers and they are qualified, he will arrange to show the property.
Determining the price for expensive, unique properties for which comparables are scarce or non-existent can be challenging.
"Deciding price is a mix of art and logic," Dreyfus said. "It's about the opportunity and how it is unique and who would want it and what they would be willing to pay for it."
In other words, it's all about supply and demand. Right now, according to local agents, supply in Palo Alto is low and demand is high even in these stratospheric markets.
Carol Carnevale of Alain Pinel Realtors reports that she and her partner Nicole Aron have several buyers interested in this price range now, but properties are difficult to find. She says that her buyers want to live in Palo Alto because they place a high premium on having a neighborhood and being part of a community.
"There is easy access to an incredible public school system. Children can bicycle to activities. There is richness and diversity in Palo Alto," Carnevale said.
While other nearby cities such as Atherton or Los Altos Hills might offer more luxury, square footage and acreage for the price, Palo Alto appeals to buyers who have different priorities.
"Steve Jobs is the icon of the whole concept of why people buy here," Dreyfus said. "They like to be in the mix. There's a whole generation of people who like to exchange ideas and you can't do that when you're on the mountaintop."
Freelance writer Kathy Cordova can be emailed at firstname.lastname@example.org.
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