|Fall Real Estate 2004
Publication Date: Friday, October 1, 2004
by Dwana Simone Bain
Perhaps it's those high ceilings. Or maybe it's the large, modern kitchens. It might be the energy-efficient design.
Whatever your reason for wanting a new home, you are not
In the Palo Alto area new homes are in great demand -- far outpacing
the supply, said Elaine Breeze, senior vice president of development
for SummerHill Homes. "There's
just not a lot on the Peninsula at all."
New homes for sale are indeed a rarity in Palo Alto and Menlo Park, said Stan Herrmann, associate broker at Coldwell Banker in Palo Alto. Excluding developing communities like SummerHill, only about five or six single-family homes, and no condominiums, are now on the market in Palo Alto. "There's less in Menlo Park," Herrmann said, noting that only one new home is on the market in Menlo at the moment.
However, those who must have a new home do have options.
Right now new home communities are the biggest source of such properties in the
Palo Alto area. Two Palo Alto-based builders, SummerHill homes and Clarum homes,
are developing new homes now.
On the site of the former Palo Alto Medical Foundation property, SummerHill homes' University Park community encompasses three new developments spanning six city blocks in the heart of downtown Palo Alto.
The Weatherly project, 30 condominiums located on Homer Avenue
and Bryant Street, sold out this past spring. The units, ranging
from about 1,000 to about 1,700
square feet, sold in the $800,000 to $900,000 range.
However, two more SummerHill projects in the neighborhood are still available.
For buyers who love new-home amenities but also adore the old-fashioned
charm of Palo Alto's traditional homes, "Our homes are kind of the best of both
worlds," Breeze said.
The collection's historical homes were restored and updated with
modern conveniences. In designing the new homes, SummerHill intended
to fit well architecturally
with surrounding properties. "When you walk around, the blocks that we've
completed look like they've been there for years," Breeze
Strolling through the neighborhood, one struggles to distinguish
the older properties from the newly built models. Only the pale
shades of the new brown shingles give
clues to the new homes' identities.
While on the outside the homes look like their historic neighbors, on the inside they are equipped tip to tip with state-of-the art amenities. The homes meet the latest energy-efficiency standards and the interior finishes, including the hardwood flooring, countertops and appliances are all coordinated by an interior decorator, Breeze said.
The completed single-family homes, which range roughly between 2,200 to 2,362
square feet, have sold in the $1 million to $2 million range. Twelve homes are
still under construction. They will be priced when construction is complete in
the spring of 2005.
And starting in the spring of 2005, Clarum homes will build a new environmentally
sound development in the Belle Haven neighborhood of Menlo Park. The project,
known as Hamilton Park, will feature 47 single-family homes, three- and four-bedroom
plans ranging in size from 1,500 to 2,000 square feet.
Clarum's "enviro-homes," also known as "zero-energy" homes will include solar electricity, tank-less water-heating systems and several other "green" features that can save homeowners up to 90 percent on their utility bill, according to Nicole Gittleson, vice president of sales and marketing for Clarum.
If Clarum's enviro-home concept sounds familiar, it is. The company
has already built 39 environmentally friendly homes in East Palo
Alto. Known as the Shorebreeze
development, the homes were built in four phases in different areas
of East Palo Alto between 2001 and 2003. The final 20 homes of
the project were about 2,200
square feet and sold for about $600,000.
Prices for the Menlo Park homes, still in the planning phases with the city,
have not yet been set.
Clarum is also building two "idea homes" with Sunset
Magazine that should be available for viewing by August 2005. Idea
inspire home builders, and the magazine often sells the plans.
The thrill of a new home is not cheap. Typically buyers pay a premium for new,
Breeze said. New home buyers are not just buying a house, they are buying a new
Of course, on the Peninsula, much of the value in a new home is
in the land. Buyers also pay a premium for good land in a good
instance a lot in old Palo Alto is worth more than a lot in South
Palo Alto, Herrmann
not just looking at the structure you're looking at where is it located," Herrmann
said. "Here, it can be half the amount of the home costs is
in the land."
That might be why home designer and builder David Crouch paid more than $900,000
for a 1,400-square-foot ranch-style home on a 10,000 square-foot lot in Western
Menlo Park and promptly tore it down.
While it might seem expensive to fork over nearly $1 million for a home just to destroy it, those who want to build in the Palo Alto area have little choice.
really no vacant land around here," he said.
Crouch , who builds before he has a buyer, is known as a "spec" builder.
He bets on what buyers will want.
Crouch replaced the ranch house with a five-bedroom, five-bathroom, three-fireplace, Tudor style home. The house has a huge kitchen, hardwood floors and French doors. "I love the old English country style," Crouch said.
The house is much larger than it looks from the street, a total
of 5,500 square feet, including a 2,000-square-foot basement. The
windowed basement is really
more like a house beneath the house, complete with a dining room,
kitchen, wine cellar, bar and bathroom.
Crouch's instincts were correct. The house sold the week it went on the market, above the asking price for about $3.3 million.
When considering the costs of bringing a 50-year-old house to current
code, repairing cracking foundations and termite damage, on a per-square-foot
down and rebuilding is usually less expensive than remodeling,
New home construction runs between $250 and $300 per square foot, while a remodel often costs between $300 and $500 per square foot, he said.
While Crouch both designs and builds houses, different people often
perform the two jobs. Generally someone building a new home hires
an architect and, once
the design is complete, a builder to fulfill the dream.
This is of course once you have secured the land. For "good property in a good location" around Palo Alto, you will have a ton of competition, Herrmann forewarned.
Generally a person who acquires a good lot will have purchased
one with an existing house. Fortunately, demolition is the cheapest
part of the rebuilding process,
about $10,000 to $15,000 according to Crouch.
For those who would rather skip the planning process and buy a
ready-made home, Herrmann advises seeking advice from a professional
While all new homes might appear well built at first, differences between a quality built product and one that cuts corners will be evident a few years down the line, Hermann said. Someone experienced with houses should examine the home's finishes, faucets and fixtures to ensure a quality product. "That," Herrmann said, "is worth money."
For more information
David Crouch Custom Homes, (650) 464-4448