Top Boulder Real Estate Sales of 2018 [#7]

--- by Osman Parvez
After acquiring the land in 2007, it took nearly a decade for the owners to execute their vision and build their dream home at 1765 Sunset Blvd. This exceptional luxury property featured state of the art design and construction, seamless indoor and outdoor living areas, and a top tier location with the best of both worlds - a spectacular view and close proximity to Boulder's downtown.  

Pics and Details

True story: I toured the home several times with my buyers but by the time they decided to move forward with an offer, another buyer had already swooped in and cinched the deal. Yes, even in this class of luxury home, competitive offers often arise as you're negotiating the deal, even for a listing that had been on the market for months. When you know it's the one, don't wait to write your offer.  

Originally listed at $4.95MM during the summer of '17, the sellers reduced the price a month later to $4.75MM and then stood firm as they waited for the right buyer to come along. The new owners purchased the property for $4.5MM in May '18, 4.5% below the asking price.

From an investment perspective, this one worked out reasonably well for the sellers. The estimated cost to construct was $2.0MM, based on permit values. Taken at that value (usually a low estimate), the seller netted about $1.47M before transaction costs. The estimated IRR was 7.3% with a 1.5X cash on cash return.  

The key to investment performance was a premium location with virtually no redevelopment risk and one saturated with luxury homes. An intelligent, crisp design and premium construction quality also helped. 

Due diligence: Sunset Blvd has a number of redeveloped, expanded, and remodeled high-end homes. If you're considering this location, careful attention should be given to footings due to potential hillside subsidence. Ask your broker for more details and if they shrug their shoulders, next time choose a better Realtor. 

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The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate. 


Please Note

This document contains forward-looking statements. You are strongly cautioned that investment results are subject to business, economic and other uncertainties. There are no guarantees associated with any forecast and the opinions stated here are subject to change at any time. Always consult your financial advisor before making an investment decision.