Flip, Slide, Build on Capitol Hill

Here’s an interesting flipping strategy that I haven’t seen before…

On Monday I walked by a home 10th Ave East up on Capitol Hill. Here’s what it looked like a while back, via Google Street View:

1108 10th Ave E: Before

And here’s what it looks like now:

1108 10th Ave E: During

The home sold last June for $826,000. So what are the new owners up to? Here’s some research by Capitol Hill Seattle:

According to permits filed for the property, the house is being lifted and moved on its lot to make room for a two-unit townhouse and attached garage that will be added to the property. It’s a project involving Bradley Khouri’s b9 architects.

Indeed, the permits on file with King County indicate that the home is being shifted out toward the street to make room on the 5,000 square foot lot for a new construction duplex in the back.

From the listing photos on Redfin, the 3,000 square foot, 105-year-old home looks to be in very nice condition. It will be interesting to see how much it sells for after losing its front and back yards and having new townhomes squeezed in behind it.

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

38 comments:

  1. 1
    Brady says:

    I have seen many SFRs with multifamily zoning get bought, two townhomes get built on the back alley, and then all are sold individually. But i havent seen this.

  2. 2
    Scotsman says:

    Seems like a lot of work for not much. What would the value of the new lot be? And the net value figuring in the loss of value to the original home? Waiting to see the follow-up.

  3. 3
    mike says:

    It looks like newer town homes can sell for upwards of $700K in that neighborhood and there aren’t many available for sale.

  4. 4

    What’s to Puzzle About?

    Rent the Townhome out for $7000/mo or $3500/mo for two units [parking obviously not included]…..or sell for $500K [it has no parking]. The 100 yr home has no parking now too, but who needs cars anyway…

  5. 5
    ChefJoe says:

    Yikes. That’s going to be a fun maze of stairs to navigate up to get a sofa through the front door that’s now on the second floor.

  6. 6
    Erik says:

    RE: Scotsman @ 2
    I thought the same thing. It doesn’t really seem worth it. We may never know if it was or not because they may just rent the units and sell in 2050.

  7. 7
    boater says:

    I’m surprised they aren’t adding an underground garage to the original home in addition to the townhouse.

    Yards aren’t as important as parking on capitol hill.

  8. 8
    Matt the Engineer says:

    RE: boater @ 7 – I assume they are. That foundation wall is smaller than the house’s footprint, so I’d guess the right side is where the garage will be.

  9. 9
    mike says:

    Anyone else notice something odd about the sales history? House was previously a short sale and it just “happened” to flood after the owner was already behind on the mortgage.

  10. 10
    goblue72 says:

    Its north Capitol Hill (I used to live two blocks from that house). The sky is almost the limit on what people will pay to live there – whether renting or owning. Its a relatively quiet residential part of Capitol Hill, with tree-lined streets and a short walk to Volunteer Park. But at same time, you are a few blocks to the north end of Broadway – meaning you can easily walk to multiple cafes, the Harvard Exit arthouse cinema, a QFC (that has a housewares section in the basement and a Gold’s Gym on the 2nd floor), many restaurants (including high end places like Alturra and Poppy), hot cocktail bars, etc.

    You are a short walk or bus ride to the Pike/Pine corridor, a hugely popular Farmer’s Market on Sunday on Broadway, etc. as well as remarkably convenient by transit to Montlake, the U-District, downtown, SLU and other core areas. And in a year a light rail station opens mid-Broadway, with a streetcar opening this year.

    People don’t pay for the house (or condo) in that neighborhood. They pay to just have a roof that allows them to have walkable access to all those things. Capitol Hill is the most complete urban neighborhood in the entire city – which is why 2500 apt units are under construction in the neighborhood (probably 1/3 or more of all the units under construction in Seattle)

  11. 11
    WestSeattleDave says:

    RE: Scotsman @ 2 – I think this is going to be a very profitable move. Relocate the house to the front yard, add two townhomes out back, and sell all three units. Probably north of $2M. Subtract acquisition cost and the price of the additional building, and you probably have a nice tidy profit. Otherwise they would not be doing it. Like Goblue said, great neighborhood in a desirable part of town.

    As for parking, I agree it looks like some parking in the front on the right. And those godawful townhomes they are building all have a garage on the first floor, with two levels of living space stacked on top.

    Expect to see lots of this going forward.

  12. 12

    RE: mike @ 9

    That Eliminates the Underground Parking….Flooding

    I’m sure King County wouldn’t approve that “necessary” option now.

  13. 13

    RE: goblue72 @ 10

    All the Businesses You Found Googling Sounds Good

    I’ve driven around in that packed city zoned area with one way streets and short routes to drive a mile turning into a 5-10 mile detour a Tom-Tom wouldn’t help you with…

    Let’s hope that QFC [the highest priced grocer in King County] parking lot doesn’t look like the one at the University Mall….totally full all the time and a 30 minute wait [blocking traffic] for someone to leave so you can steal a parking spot….if I lived there and had to drive, I’d take up a lot more drinking [and walk, not drive, to the neighborhood pub]. My relatives lived in neighborhoods like that and wonderred how my dad’s cars in Lynwood would last like 200K miles, when there’s were shot before 100K…..constant idling and slow speeds wears them out much faster.

  14. 14
    Matt the Engineer says:

    RE: softwarengineer @ 13 – I think you’re a little too focused on the car aspect of one of this state’s most walkable neighborhoods.

  15. 15
    boater says:

    RE: Matt the Engineer @ 14
    Agreed. Capital Hill is super walkable and with the light rail coming in and Uber drivers all over it’s very easy to live there without a car.
    But I’m pretty sure softwareengineer has felt real estate in Seattle has been over priced since 1980 so I don’t think you’ll change his mind now.

    Some people are permanently bearish some permanently bullish. The interesting ones are the ones who change their opinions based on the realities of the world as it changes.

  16. 16
    mike says:

    RE: softwarengineer @ 13 – Who cares if a car is dead at 100K. Living in the city it could take 20-30 years to put on that many miles. FWIW, I bought a pickup truck when I bought my house. It’s going to hit the first 3K oil change sometime in the next month or two if I keep using it several times a week to haul rocks, dirt and lumber.

  17. 17
    wreckingbull says:

    RE: mike @ 16 – Another option if you have the space and $1600 is:

    http://trailerinfo.com/ironeagle/utility-trailers/voyager/

    I have a full-size pickup, but never use the bed now. In fact, I am considering ditching the pickup altogether. These will carry twice the weight of a fullsize pickup. Dealer in Maple Valley. Take a look at Craigslist and you will also see that they hold their value quite well.

    As a lifetime pickup driver, I am now converted. A little more of a pain when you use it, but also much easier to load and unload.

  18. 18
    Erik says:

    RE: mike @ 16
    I have 280k miles on my 2000 Nissan Frontier. Planning on taking her to 500k miles. My mom says after riding in my truck she feels like she just got the sh!t beat out of her because it’s so bumpy. Since I don’t have a job, I have been going to the junkyard and replacing the broken annoying parts. The Nissan has been in a few accidents. I just repair my pickup myself and collect a check from the person’s insurance that hit me. I have collected about $4k and spent $1k on fixes. Sometimes I hope someone runs into me when I am running low on money so I can collect.

    Last time I got hit, I was running low on funds. Luckily I got hit and collected $2400 so I could finish my remodel. Well, $2400-$120 for driving in the carpool lane. When I lived in Kirkland and worked in Seattle, so driving in the carpool lane made sense. Hopefully I won’t have to do that for my next job.

  19. 19
    Blurtman says:

    RE: Erik @ 18 – You are clearly an entrepreneur. Perhaps you should broaden your product portfolio to include walking in front of pricey cars (Mercedes, Porsche) to collect insurance money, falling down stairs at Fairmont Hotels, slipping on spills at Whole Foods, etc. Reach for the stars!

  20. 20
    redmondjp says:

    RE: Blurtman @ 19 – Yes, I hear that one can really clean up being a serial slip-n-faller, it’s amazing what some people will come up with to avoid actual work!

    A small utility trailer is really great, until you get into a spot where you have to back up and can’t even see it out either the back window or the side mirrors (well, until it is already sideways, at least). I just towed one with my Passat a couple of weeks ago – it was easier to disconnect it and move it myself than it was to try to back up with it (for the reasons given above). It’s far less expensive than keeping a truck, that’s for sure. And the really small ones can be stored on end and not take up hardly any space.

  21. 21

    RE: Matt the Engineer @ 14
    Enjoy Walking and Carrying Your Over-priced Bags of Groceries and Maintenance Supplies [Is There Like a Home Depot Nearby?] Home

    Ahhhhh…..I’m just a high priced real estate pragmatist, what do I know.

    When you get a bit older, I’m sure you’ll escape from politically correct just because, to a real retirement investor with an IQ. BTW, most Millenials totally agree with me.

    Ohhhhhh….I do hope you can walk OK as you age [you will BTW]…..a lion’s share of the 50-60+ YOs have trouble walking…..I know, they can take the cab.

  22. 22
    David B. says:

    RE: softwarengineer @ 21 – Many elderly people have trouble driving, too (and in a society that had a more balanced transportation policy it would be much easier to just revoke their diving privilege because it wouldn’t so often limit their ability to get around so much).

    And my experience has been that those of us who exercise regularly (which is easier to do in a walkable neighborhood that motivates one to not use a personal vehicle for every last trip) keep more of our mobility as we age. I’m in my fifties now, and I can do hikes that people 20 years younger than me (and out of shape) couldn’t think of doing.

  23. 23

    By David B. @ 22:

    RE: softwarengineer @ 21 – Many elderly people have trouble driving, too (and in a society that had a more balanced transportation policy it would be much easier to just revoke their diving privilege because it wouldn’t so often limit their ability to get around so much)..

    I’m hoping that self-driving cars will be common by the time I need (and will tolerate) such a thing. With our aging population they clearly are going to become necessary.

  24. 24

    RE: David B. @ 22
    Pure Discrimination Hogwash

    Folks up to 70 and Even 80

    May have slower reaction times, but FAR more experience driving and yes, better driving records generally than most. Ask any insurance company.

  25. 25
    drshort says:

    RE: softwarengineer @ 24

    Data shows that around the mid 60s in age accident frequency increases and goes up fairly significantly as you get older, especially if you adjust for the lower annual mileage driven. There’s a pretty broad range of eye sight and physical abilities in the elderly, so some older drivers are perfectly fine. But not so much as a group.

  26. 26

    RE: drshort @ 25 – That was always my understanding too on accident frequency. And the reason for that is that the elderly tend to move back into dorms, and you know what goes on in dorms! ;-)

    But in any case, I wasn’t just addressing accident frequency. Older people can be a hazard on the road because of their driving habits (slow, confused, etc.). They might not be personally involved in an accident, but as more and more of our population gets to be above 65 years old and older, it will start impacting the highways.

    http://www.cdc.gov/motorvehiclesafety/older_adult_drivers/adult-drivers_factsheet.html

  27. 27
    mike says:

    Interesting take here on price appreciation from Calculated Risk. This seems to be in line with my earlier assertion that Seattle (city anyway) could again see low double digit appreciation in 2014. My own observation is that this is going to be a year where we see a lot of $550K fixers sold in the core North Seattle neighborhoods.

    “There is still no clear evidence of a slowdown in price increases yet.”

    Read more at http://www.calculatedriskblog.com/2014/04/fnc-residential-property-values.html#udshvB40FA6V0zEg.99

    http://www.calculatedriskblog.com/2014/04/fnc-residential-property-values.html

  28. 28
    David B. says:

    RE: softwarengineer @ 24 – How is my point any more “discrimination hogwash” than yours about many elderly people having difficulty walking appreciable distances?

  29. 29
    boater says:

    RE: David B. @ 28
    Please don’t feed the trolls.

  30. 30
  31. 31
    ChrisM says:

    RE: softwarengineer @ 24 – “Folks up to 70 and Even 80 May have slower reaction times, but FAR more experience driving and yes, better driving records generally than most. Ask any insurance company. ”

    Given that I work for an insurance company I’m reluctant to provide a definitive answer (since I in no way speak for any insurance company), but one can read:
    http://usatoday30.usatoday.com/news/nation/2007-05-02-older-drivers-usat1a_N.htm?csp=34

    which states “Fatality rates for drivers begin to climb after age 65, according to a recent study by Carnegie Mellon University in Pittsburgh and the AAA Foundation for Traffic Safety, based on data from 1999-2004. From ages 75 to 84, the rate of about three deaths per 100 million miles driven is equal to the death rate of teenage drivers. For drivers 85 and older, the fatality rate skyrockets to nearly four times higher than that for teens.”

    “Interesting” that if you search aaa.com for that same quote you only get platitudes about danger signs for senior drivers.

    Obviously we should be screening older drivers in the same way we do teen-age drivers – both have significant impediments to safe driving, but the seniors turn out the vote better and have more money, so corrupt institutions like aaa and aarp are happy to run interference for the incompetent aged drivers.

  32. 32

    RE: ChrisM @ 31
    So I guess we don’t want to encourage seniors to learn how to text?

  33. 33
    Erik says:

    I don’t have a problem with old people. I have a problem with old people that quit learning and and bettering themselves. When I get old, I will for sure go back to school.

  34. 34
    Erik says:

    Swe is old and he continues learning and taking in new information. That is great! Good on him.

  35. 35

    By Erik @ 33:

    I don’t have a problem with old people. I have a problem with old people that quit learning and and bettering themselves. When I get old, I will for sure go back to school.

    And you’ll take the bus there, right?

  36. 36

    By Erik @ 34:

    Swe is old and he continues learning and taking in new information. That is great! Good on him.

    It’s interesting how our definitions of “old” evolve. When I was a kid, I thought people who were in their 30’s were ancient. When I was in my 30’s, I thought people in their 50’s were fossils, dinosaurs. Now I’m in my 50’s. I may be old, but I sure as helh ain’t mature. People in their 90’s are old. If you ask me that when I’m in my 90’s, provided I’m still around, I’ll tell you that you need to be 100 to be old, if I remember the question.

  37. 37
    Blurtman says:

    RE: Ira Sacharoff @ 36 – Growing old is inevitable. But if possible, growing old gracefully would be a good thing. Maybe like Clint Eastwood. Marry a hottie Latina and have kids when you are 70. Or drive absurdly expensive cars badly. Having money helps, but living well is best.

  38. 38
    Peter Witting says:

    RE: softwarengineer @ 24

    “Old-old” people are a flat-out hazard on the road!

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