OK now for available land between $1M and $2M. At present there are 16 listings.
Among other posts I'm considering:
-1031 Exchanges
-Deal of the Isle - The property I think is the best deal on Nantucket.
-Demo Derby - A (probably only partial because it is so lengthy) list of the homes bought only for the land. In order to understand the land market on Nantucket, you also have to have a good view of whats going on in the demo market because its a significant and growing part of the land market.
OK, on to Land $1-$2M.
Takeaways:
-9 out of the 16 lots are located in Sconset, leaving only 7 lots $1M-$2M in other parts of the island, with one of them being kind of irrelevant (6 Cathcart portion).
-The lots just over $1M seem like they should be just under $1M
-The lots in the mid $1M rage seem like with a little downward tweak they would make much more sen$e
-The lots at the upper $1M end need a more significant price improvement before they make sense.
-The best deal in this range is 307 Polpis Rd at $1.7M (Under agreement 6/23/17)
5 Hawks Circle, Sconset $1,195,000 This street is next to all those Cannonbury lots that were for sale. When all those lots were listed for $1.55M each, this didnt look too bad in comparison. Now that Cannonbury might be sold, and a steady stream of spec homes forthcoming, it doesnt look as good! A 33% land to value ratio would mean a $3.6M property and I dont know if that is doable here. I would think $3M tops and more like $2.7M especially with the unknown near future on Cannonbury. 33% of $2.7M is $900K. 25% which spec builder like to see (which is becoming increasingly difficult and basically no longer exists) would be 675K, so in between those numbers, closer to the 900K side. Again I would want to know what is going on on Cannonbury first. If a developer gets all those lots on the cheap and is therefore able to sell the finished homes cheaper (especially the first few to get some cash flow going), you may be able to have the same home on Cannonbury for significantly less (~$500K?) than if you built that same house on this lot after paying even 900K for it, or even 800K for it.
139 Polpis Rd $1,199,000 This 1.22 acre lot evidently has a preservation restriction on the first 200 feet of it with a permitted building envelope at the back of the lot. I dont see a problem with this since thats where I would want to put the house anyway, back off the road. It has about a 2000 sq ft of permissible ground cover which translates into a 4000 sq ft 2 story house, so not too bad there. A 4 bedroom 4.5 bath 2646 sq ft house with pool on the lot next door is for sale for $2.095M which actually looks like a decent deal while causing this lot to look a bit expensive. The assessment on the house is $575K more than the asking price and the Town web site says it was built in 1920, so maybe condition of the house is the reason for the price. So in looking for a lot, you may find a decent deal on a house instead, funny how that works. Access is by a dirt drive on the side of the house that is for sale to the rear of the lot that also provides access to 135 Polpis (so there is an easement which is in the buildable envelope). There is a pond mostly on the property next door that might require a setback that could eat a little more of your buildable envelope, I would check before you make an offer. There is still room for a house, but there are some restrictions here. There are quite a few $2+M sales in this area but most are from 2014, which I would think is about 30% ago, so I would put the potential here at about $2.7-3M which puts this lot value around the 900K mark in my opinion, with 800K even better because of all the limiting restrictions.
17 Ellens Way $1,295,000 Most of the homes on this street are quite similar and have sold for between $2.685M (2015) and $3.0M (OCT 2016). Using a $3.0M completed value figure (#13 is for sale for $2.795M and #14 for $3.095M), this lot at $1.295 is a bit expensive at 43%. A better 30% figure would work out to a price of 900K for this lot. To figure what value for a property you would have to have in order for the land to be 30% of the final value just take the land price and divide by 0.3. If that number is too high for that neighborhood (not accounting for some big difference caused by a better view, etc), then the price is likely too high. $1.295M divided by 0.3 = $4,316,666 which is WAY to high for this neighborhood. Also there are 19 lots on this road and only 6 houses ( with 2 of them for sale), so there are 12 more lots besides this all owned by the developer, which means years of construction traffic left to go (maybe a decade at the rate they are going, this development is already 11 years old).
4 Windsor Rd, Sconset $1,300,000 (down from $1.495M) 1.26 Acres out in the Wilds of Sconset not far from the 1.5 Acre "Rear Plainfield" lot that sold in Dec 2016 for $1.5M. Other than the .25 acre difference, this lot is limited to 1 dwelling whereas Rear Plainfield was not. So I guess you can still have your house, pool and pool cabana, you just cant have a 2nd dwelling, or cottage. Is that worth a $200K discount from Rear Plainfield? I'd say yes. $1.1M or $1.2M would be a better fit though. The fact its been on the market for 734 days also says 1.1-$1.2M would be a better fit. Add 40K for a septic in this area.
10 Plainfield Rd, Sconset $1,395,000 1/2 acre lot with 2500 sq ft of available ground cover. Not far from the 4 Windsor lot above (about 1000 ft away). With 4 Windsor's 2.5 times the area and 2.74 times the amount of ground cover makes this lot look comparatively expensive. Add 40K for a septic in this area.
85 N Sankaty Rd and 85 S Sankaty Rd $1,340,000 and $1,400,000 respectively. These 2 lots are capable of a house, cottage, pool, etc. 85 S with its 1100 more sq ft of ground cover is certainly worth the $60,000 difference. The question is it worth $1.4M? Using our handy divide by 0.3 tool, that gives us a finished value of $4.666M which I think might be a tad high. I would peg the potential of these lots closer to $4M, so a $1.2M lot price. So the asking prices are not far off.
25A Clifton St, Sconset $1,400,000 This 1/2 acre lot is not far from the 4 Windsor Rd and Plainfield Rd lots and like the 10 Plainfield lot looks a little expensive. The potential here looks to be about $3.5M (the house for sale at 14 Clifton for $3.545M also supports this), so a 30% land cost would be $1.05M, which is very close to the $1.095M sale two lots down at 63 Burnell St (which is now 2 years old). I think that sale at 63 Burnell was a little ahead of its time, so I'm sticking to my $1.05M for this lot although it will probably sell for a little more ($1.2M is my official guess).
5 Black Fish Lane, Sconset $1,550,000 Sales on this street have recently been $3.2M to $4.25M. The sale at 20 Black Fish was an expansive 6200 sq ft home with pool, etc etc. Figuring every one of those 6200 sq ft at low $450 gives a building value of $2.79M. Subtracting that from the $4.25M gives a residual of $1.46M. If this was the land cost, it would leave zero profit at a land price of $1.46M. The $3.2M sale at #15 was 5423 sq ft. Figuring that at $450/sq ft would leave only $759K as residual. I'm finding it difficult to justify the $1.55M price here. 30% of a $4.25M sale would be $1.275M so thats about what I would put as the max price for this lot. $1.15-$1.2M is more like it.
21 Black Fish Lane, Sconset $1,995,000 While this might bring a little more than the 15 Black Fish above (100K or so) because it is at the end of the road, its the same deal as #15. This lot is basically the same as #20 that sold finished for a deal at $4.25M, just at the opposite side of the cul de sac, making this lot a very expensive 47% land cost.
49 Sankaty Rd, Sconset $1,600,000 This 0.4 acre lot can support 4000 sq ft of ground cover, so quite a bit! Not far from the 85 Sankaty lots above (which are about twice the size), this lot has about the same potential as those but is priced significantly higher. I could see a little higher than the #85 lots as it is closer to Sconset Village, but the 30% rule brings the value to $5.333M which I think would be difficult here. This has been on the market 647 days, pushing two years, so I guess I'm not off base. I'm thinking about $1.2M here.
6 Cathcart Rd (portion) $1,650,000 This seller apparently has an oversized lot and is trying to sell off a piece of it to lower his $5M purchase cost. The problem is this piece is not big enough to be a standalone lot, so the only two people on planet Earth that it makes sense to buy this are the two neighbors on either side. What confuses me is why is this listed with a broker? Since your market is TWO, go to each next door neighbor and knock on the door. "Hey, like, you wanna buy this piece of land and make your yard bigger?" You have now completed your marketing campaign. Why pay a broker $82,500? Nothing in this listing makes sense, including the price.
307 Polpis Rd $1,700,000 3 Acres in Polpis! 3900 sq ft of ground cover! This looks to have a small house built in 1955 that they are apparently assigning no value to since they dont even mention it in the listing. Nice sized lot with views across the cranberry bogs to the rear. There are some wetlands at the back of the lot so you will have a setback from that, but no big deal because of the size of the lot. This was listed at $2.1M in July of 2015, nearly 2 years ago and periodically reduced to its present $1.7M (with 2 $100K reductions in the past 4 months alone, a sign they are ready to sell!) Honestly I dont have a problem with this price since it could support a $6-$7M compound, meaning a $1.8M to $2.1M land value at 30%. A really good 25% land cost would yield a price of $1.5M to $1.75M. This is a very fairly priced lot, especially if you can get it a little cheaper since its been on the market so long. So far this is the best deal in Land as far as I'm concerned. Oh, add $40K for septic and well (more if you are building a big compound). ***Under agreement 6/23/17 after 697 days on the market***
20 Pippens Way $1,899,000 This 1.12 acre lot is priced significantly above what other lots in this development have sold for. It may have some 2nd floor distant harbor views, but it doesnt say so in the listing. This has LINK #79545 attached to it which means its been on the market a LONG time (they are in the 83300's now, think about how long it takes to go through 4000 listings on Nantucket). A better comparative deal would be the nearby lot at 57 Shawkinno Rd, 2.76 acres, distant harbor views, $1.95M, although at 246 days on the market this looks like it needs a price reduction as well. Figure ~40K for septic on either lot, although they have been expanding sewer in this area in recent years, so check with the DPW. It would suck to have to connect to the sewer 15 minutes after you spent 40 grand on a septic (although 2 or 3 weeks of summer rentals would pay for it).
65 Westchester St $1,998,000 Honey lets buy it, its less than $2M! Its a much better deal than if it were $2M! Well its not a good deal. There have been several $5M+ spec sales nearby and this might support something like that, but the numbers have to make sense. At 30% land cost would be $1.575M on a $5.25M sale. In order for the $1.998 asking price to equal 30% of your project, it needs to have a final value of $6.66M, which is about $1.4M higher than recent nearby sales. There is a $5M+ spec house on Madaket Rd that has a $980K land cost (so like 20% land cost!). If they are making ~$1M on that, it simply doesnt make sense to pay $1M more for the next lot (although they will be forced to pay more than that $980K, that doesnt exist anymore). At that point they might as well go blue fishing off the beach until things make sen$e again. At an attractive and just about impossible to find anymore 25%, this lot becomes $1.312M. I dont think it will ever get that low, but I do think this needs to come down $300-$400K in order to move. I think the recent $1.44M sale of a smaller lot at #59 was someone paying a bit too much, and that $1,.6M sale at Pilgrim Rd (2 sales in 2 weeks!) was someone paying way too much. Dont get me wrong, if the owners of this lot can get someone to pay too much, hats off to them. But so far after 412 days on the market no such luck. It should also be pointed out the listing broker has a lot of development experience on the island so if it were such a good deal why isnt he buying it? Even more overpriced is the nearby 5 Pilgrim Rd lot at $2.495M. You just arent going to have a $8.3M (30% land cost) property there. Same goes for the lot (or lots) at 9 Pilgrim Rd.
No comments:
Post a Comment