When Even the Best Greenway Parks Realtors Miss the Value
Greenway Parks may be the most popular neighborhood in Dallas. It is also the neighborhood with the highest concentration of top real estate agents, which is another good endorsement of the neighborhood. And yet, I often see even these top real estate agents who live in Greenway Parks underestimate the value of the homes in their neighborhood.
When the Market Underestimates a Greenway Parks Home
I recall a very small architect Charles Dilbeck historic home that I helped a buyer purchase that had been listed for less than a same-size home in a modest Old East Dallas neighborhood. Or a small architect-designed Greenway Parks mid-century modern home that I listed and sold for a higher price than the neighborhood agents thought the home would sell for.
This buyer still marvels at what a great home they purchased and what a good value it was because nothing comparable in architectural quality or location has become available in Dallas at anywhere near the purchase price.
Another example was a relatively new architect-designed modern home that I listed at a price higher than the neighborhood Realtors thought it was worth and sold to a buyer I represented. This 5,000-square-foot home ended up being the most expensive home on less than half an acre that sold in Dallas that year. Despite the higher-than-expected sales price, many buyers later wished they had purchased the home because another home of this architectural significance and livability has not come on the market since in a neighborhood this desirable.
The home that I think best illustrates how even top real estate agents in the neighborhood can miss the value is a 1950s one-and-a-half-story Colonial-style mid-century ranch house designed by Fooshee & Cheek on .953 acres in Greenway Parks.
The home had been owned by the same family for several decades and was now in an estate handled by the children. It was stacked high with a lifetime collection of furniture and other personal effects of the family that had been consolidated at the home.
The children handling the estate and the sale of the home lived in Dallas, attended St. Mark’s, were well connected in the community, and were friends with many of the top agents in Dallas and Greenway Parks. Several of the agents they knew and were friends with had come through the house or the estate sale and said the house itself had no value. They all said it was 50 years old, needed so much work, had low ceilings, and the exterior style was out of date. In other words, it was a teardown and ought to sell for lot value in line with what the other lots were selling for in Greenway Parks.
I Saw the Same House Differently
I saw the same things the other agents saw, but I interpreted what I saw differently.
Yes, I agreed. It was true that not many people were probably waking up in the morning and saying, “I sure hope I can find a 1950s one-and-a-half-story Colonial-style mid-century ranch house with 8½- and 9-foot ceilings that does not have a 21st-century kitchen, primary bedroom suite, bathroom, and closets.”
However, I saw a charming home that was beautifully composed, evoking a nostalgic feeling of what a neighborhood home should be. The American flag flying from a porch post seemed not overly patriotic but perfectly in place for a neighborhood Colonial-style home.
Since the architects Fooshee & Cheek had previously been partners with the great society architect Hal Thomson, they designed the home with very large rooms that opened up to each other and had an abundance of windows. The home could easily be updated within the original framework of this luxurious and very important home of its time.
And what really impressed me was that this home was on the largest lot in Greenway Parks, on the corner of landscaped Greenway Parks Boulevard.
Recognizing the Value Others Missed
I listed the home at a much higher price than the neighborhood Realtors recommended or suggested to the owners. One of the people I showed the house to was one of my clients. He had never redone a house and was certainly not looking to have to redo a house. He did not need a home this large.
I also told him the price was higher than the commonly perceived value, but I thought it could be a great investment and that he should take a look at it. I shared with him that, in my opinion, it was land that went up in value, not structures, and this was the largest and best lot in Greenway Parks.
I introduced him to a brilliant interior designer, Allen Kirsch, who designed entire houses in addition to doing the interior design and architecture of homes. Allen was able to give him a vision of the home once it was renovated. He also introduced my client to a contractor Allen often used on homes for which he was designing the renovation.
Remarkably, in addition to not wanting to redo a house, having no experience renovating a home, and not needing a home this large, my client was very cautious by nature and financially prudent as a partner with a prominent hedge fund. On top of that, he had never even owned a home before.
He bought this home.
A Renovation That Rewarded Vision
My client had the home renovated, and it became a place of many neighborhood parties and other celebratory events. He loved the home, as did everyone who saw the home.
The Resale Confirmed the Value
Many years later, when my client retired and moved out of town, I listed this home again at a price higher than any of the other homes in Greenway Parks.
Once again, many thought the home was overpriced.
While many potential buyers were very interested in the home, it eventually sold to buyers who initially looked at buying the home but then decided to purchase the home for its lot and build a new home. They paid more for the lot than anybody had paid for a home in Greenway Parks at that time.
Many who thought my client had overpaid for the home saw that its appreciation far outperformed that of any other home in the Greenway Parks neighborhood during the same time period.
Why This Lot Appreciated More Than Others
Not all land will appreciate as much as this Greenway Parks lot, but land is always an important and often underestimated element of a home’s value.
There is a reason this almost one-acre lot went up so much in value in comparison with the other homes in the neighborhood. Greenway Parks is a popular neighborhood that attracts homebuyers who have wealth and resources far beyond the cost of Greenway Parks homes. These buyers can afford homes in any price range and in any neighborhood but love the special characteristics of Greenway Parks.
Scarcity Determines Value
While there are only 294 homes in the Greenway Parks neighborhood, there are only 26 homes on over half an acre, and only three homes on three-quarters of an acre. There is only one home on nearly one acre.
The buyers of this home considered Greenway Parks the best neighborhood—the favorite neighborhood for their family. This site and the size of the lot represented a singular opportunity. As a result, they paid a higher price than the adjusted comparables might suggest it was worth.
However, for the same reason, if these homeowners were to sell, their home would again outperform the market because it is a spectacular home on the largest lot in Greenway Parks.
This Greenway Parks case study once again shows that demand, scarcity, and desirability determine the value of an architecturally significant home and land in an attractive neighborhood.
Discuss Representation of an Architecturally Significant Home with Douglas Newby
