I'm designing a house, it's my first house and a renovation, the site is beautiful and oceanfront. Above all the owner wants to maximize the retail value which in his mind means more size = more $.
I'm looking for examples of rational, well intentioned design that have sold at a premium (preferably in the USA).
Thanks in advance for any information you can provide!
what's the existing house like to be renovated? are you going to blend in the addition or do something completely different? what does the client like? what's the neighborhood like?
if it's oceanfront you'll want to maximize those views but to get the most cash you don't want the house to be too overpriced compared to the neighborhood so analyze the context and step it up just a little.
I'm looking for examples of retail values, for example a house that was sold in a newspaper that had a high $/sq. ft retail value in relation to the houses surrounding it, because of the quality of the design and not due to the immense size of the house.
Is there some sort of realty company that specializes in high design?
PS. I saw Denari present that house at a lecture last November, really nice work.
There is, in fact, a realty company that specializes in architectural masterpieces... it is nationwide... am blanking on the name, but they handle things like the neutra house in palm springs, etc. Might be worth contacting them.
Of course, your house would probably only reach that status after you died, assuming, in fact, that it ends up being a masterpiece.
it's tougher to get those kind of comparables for more recent work, unless it's by a bonafide star like gehry or someone of national renown. if it's more 'historical' in age, it's easier to do those kind of comps.
for example, the esherick house, by louis kahn, was up at auction for 2.4mil this past fall (didn't sell, mostly due to lousy timing) in a neighborhood that has an average sales price of 400K. this for a 2000sf (ish) house. frank lloyd wright, corb, loos, schindler, greene + greene - anyone canonical is going to sell for a premium.
as for us mere mortals... mostly it will depend on the appraiser and bank. we've tried, very unsuccessfully, to make a similar argument on two projects (smaller size, higher quality) and neither could appraise for anything close to what was needed, simply because it wasn't big enough. they didn't care we were putting in a bulthaup kitchen or ikea, or duratherm vs. pella. just didn't matter at all. further, in this climate, i'd say, in this climate, you'd be really hard pressed to make that case. (maybe with the exception of demonstrating that the house is 'green' enough to show lower long term operating costs and maintenance. that might work...)
now, cash talks, so if the money is there, anyone can buy anything. your client is the one fronting the money in hopes of a return - he'll have to gauge how to play the odds.
real estate is so subjective... it's hard to believe now (or, perhaps, easier to believe lately?) but for a long, long, long time real estate was not considered a good investment as the variables were so impossible to predict. (My parents often repeated their mantra to me : "Buy land if you must -- but don't invest in a building unless it is a second home in a high-rent area that you will just pump for rent!") Anyway, I think you'd be hard-pressed to build a specific argument for your client in this case but I have un the past successfully built general arguments for the resale value of good design.
It would be extremely helpful to you to strike up a friendship with a local realtor who specializes in these types of homes, for two reasons:
1. You can use a realtor to help convince a client of the market value of design. If it's a good realtor, they will back you up and they will be able to take your client on a quickie tour of similar houses with a narrative of what they sold for and why. Make use of your friendly neighborhood realtor -- he will want to serve you as well : realtor / architect relationships go both ways, which brings me to point #2:
2. A good realtor friend can refer a LOT of business to you over the years, and is a great way to build up a client network. On the flip side, a good architect friend can help a realtor sell a place because the realtor can say "this house has a lot of potential, and I know a good architect with affordable rates who could do wonders with it..." In this way, the architect's vision can help the realtor sell the potential of a home. The architect can also, of course, refer business to realtors. So it's very symbiotic in that way.
Anyway just some thoughts. I could give you specific examples but unfortunately they wouldn't have much bearing on your case as they are in a very different market. I've worked with clients who made a bundle on a building solely because of the architecture, however. It isn't unusual.
Tossing in some archi-babble will go a long way. You are aiming for an educated buyer, one that appreciates contemporary design, knows a few stararchitect's names, and will pay for it.
They want to know why that big window is special, why crown molding is hideous, etc., etc.
This is somewhat new, I think. The architect/developer are going to be better salespeople than generic realtors. Show passion in the design and that will give people confidence. Stress how things are unique to the site, not a pathetic reproduced McMansion (in what ever flavor).
if you know of particular projects in the area that you would like to find out how much they sold for, you can look up that information in the public records at the tax appraisal office/city hall/wherever that info is kept on file for the city/town...
easy, man. granite countertops, stainless steel appliances, and crown moldings, i.e. i think you may confusing profitability with good design. i wouldn't try to fit a round peg in a square hole.
One being a high design premium when you have a landmark or signature type house. The return can be huge I suppose but I would guess much more risk also as your potential market is limited bc you need to sell to someone who wants to pay for high design and more risk bc construction wise, you might be sticking your neck out.
The second one is a premium in a well-laid out well constructed house. Could be subtle things like laying out the entry/ kitchen/ living area well so the house seems bigger etc., using the expensive materials only where we really get max use, etc.
Seems like yr client is looking for the second, especially since they want a big house.
Apr 3, 09 2:13 pm ·
·
Block this user
Are you sure you want to block this user and hide all related comments throughout the site?
Archinect
This is your first comment on Archinect. Your comment will be visible once approved.
Price Premium for Good Design
I'm designing a house, it's my first house and a renovation, the site is beautiful and oceanfront. Above all the owner wants to maximize the retail value which in his mind means more size = more $.
I'm looking for examples of rational, well intentioned design that have sold at a premium (preferably in the USA).
Thanks in advance for any information you can provide!
i demand a price premium for doing your research
what's the existing house like to be renovated? are you going to blend in the addition or do something completely different? what does the client like? what's the neighborhood like?
if it's oceanfront you'll want to maximize those views but to get the most cash you don't want the house to be too overpriced compared to the neighborhood so analyze the context and step it up just a little.
I charge 75% more for the good designs.
I can't imagine this was the most economical solution to adding to their house, but I also can't imagine a more attractive home addition either.
Neil Denari: Alan-Voo house.
Sorry, to be clear...
I'm not looking for design advice
I'm looking for examples of retail values, for example a house that was sold in a newspaper that had a high $/sq. ft retail value in relation to the houses surrounding it, because of the quality of the design and not due to the immense size of the house.
Is there some sort of realty company that specializes in high design?
PS. I saw Denari present that house at a lecture last November, really nice work.
What is "retail value"?
There is, in fact, a realty company that specializes in architectural masterpieces... it is nationwide... am blanking on the name, but they handle things like the neutra house in palm springs, etc. Might be worth contacting them.
Of course, your house would probably only reach that status after you died, assuming, in fact, that it ends up being a masterpiece.
manta - are you thinking of www.architectureforsale.com
i love that site! (i can dream ..)
it's tougher to get those kind of comparables for more recent work, unless it's by a bonafide star like gehry or someone of national renown. if it's more 'historical' in age, it's easier to do those kind of comps.
for example, the esherick house, by louis kahn, was up at auction for 2.4mil this past fall (didn't sell, mostly due to lousy timing) in a neighborhood that has an average sales price of 400K. this for a 2000sf (ish) house. frank lloyd wright, corb, loos, schindler, greene + greene - anyone canonical is going to sell for a premium.
as for us mere mortals... mostly it will depend on the appraiser and bank. we've tried, very unsuccessfully, to make a similar argument on two projects (smaller size, higher quality) and neither could appraise for anything close to what was needed, simply because it wasn't big enough. they didn't care we were putting in a bulthaup kitchen or ikea, or duratherm vs. pella. just didn't matter at all. further, in this climate, i'd say, in this climate, you'd be really hard pressed to make that case. (maybe with the exception of demonstrating that the house is 'green' enough to show lower long term operating costs and maintenance. that might work...)
now, cash talks, so if the money is there, anyone can buy anything. your client is the one fronting the money in hopes of a return - he'll have to gauge how to play the odds.
actually I think that's it, FRaC! Well done.
real estate is so subjective... it's hard to believe now (or, perhaps, easier to believe lately?) but for a long, long, long time real estate was not considered a good investment as the variables were so impossible to predict. (My parents often repeated their mantra to me : "Buy land if you must -- but don't invest in a building unless it is a second home in a high-rent area that you will just pump for rent!") Anyway, I think you'd be hard-pressed to build a specific argument for your client in this case but I have un the past successfully built general arguments for the resale value of good design.
It would be extremely helpful to you to strike up a friendship with a local realtor who specializes in these types of homes, for two reasons:
1. You can use a realtor to help convince a client of the market value of design. If it's a good realtor, they will back you up and they will be able to take your client on a quickie tour of similar houses with a narrative of what they sold for and why. Make use of your friendly neighborhood realtor -- he will want to serve you as well : realtor / architect relationships go both ways, which brings me to point #2:
2. A good realtor friend can refer a LOT of business to you over the years, and is a great way to build up a client network. On the flip side, a good architect friend can help a realtor sell a place because the realtor can say "this house has a lot of potential, and I know a good architect with affordable rates who could do wonders with it..." In this way, the architect's vision can help the realtor sell the potential of a home. The architect can also, of course, refer business to realtors. So it's very symbiotic in that way.
Anyway just some thoughts. I could give you specific examples but unfortunately they wouldn't have much bearing on your case as they are in a very different market. I've worked with clients who made a bundle on a building solely because of the architecture, however. It isn't unusual.
Tossing in some archi-babble will go a long way. You are aiming for an educated buyer, one that appreciates contemporary design, knows a few stararchitect's names, and will pay for it.
They want to know why that big window is special, why crown molding is hideous, etc., etc.
This is somewhat new, I think. The architect/developer are going to be better salespeople than generic realtors. Show passion in the design and that will give people confidence. Stress how things are unique to the site, not a pathetic reproduced McMansion (in what ever flavor).
if you know of particular projects in the area that you would like to find out how much they sold for, you can look up that information in the public records at the tax appraisal office/city hall/wherever that info is kept on file for the city/town...
easy, man. granite countertops, stainless steel appliances, and crown moldings, i.e. i think you may confusing profitability with good design. i wouldn't try to fit a round peg in a square hole.
Thank you all for your input!
That website is great, exactly what I was looking for.
I think there are two levels of premium.
One being a high design premium when you have a landmark or signature type house. The return can be huge I suppose but I would guess much more risk also as your potential market is limited bc you need to sell to someone who wants to pay for high design and more risk bc construction wise, you might be sticking your neck out.
The second one is a premium in a well-laid out well constructed house. Could be subtle things like laying out the entry/ kitchen/ living area well so the house seems bigger etc., using the expensive materials only where we really get max use, etc.
Seems like yr client is looking for the second, especially since they want a big house.
Block this user
Are you sure you want to block this user and hide all related comments throughout the site?
Archinect
This is your first comment on Archinect. Your comment will be visible once approved.