You're Going to Need Advice When it Comes to Price

To understand today’s complex real estate market, it is critical to have a local, trusted advisor on your side – for more reasons than you may think.

In real estate today, there are essentially three different price points in the market: the starter-home market, the middle-home market, and the premium or luxury market. Each one is unique, and depending on the city, the price point in these categories will vary. For example, a starter or lower-end home in San Francisco, California is much more expensive than almost any other part of the country. Let’s explore what you need to know about each of these tiers.

Starter-Home Market: This market varies by price, and these homes are typically purchased by first-time home buyers or investors looking to flip them for a profit. Across the country, homes in this space currently have less than 6 months of inventory for sale. That means there aren’t enough homes on the lower end of the market for the number of people who want to buy them. A low supply like this generally increases competition, drives bidding wars, and sets up an environment where homes sell above the listing price. According to data from the National Association of Realtors (NAR) on realtor.com,

“The desire for affordability continues to push down the inventory for homes listed for less than $200,000.00.”

Middle-Home Market: This segment is often thought of as the move-up market. Typically, the buyer in this market is moving up to a larger, more custom home with more features, all coming at a higher price. Across the country, this market is looking more balanced than the lower end of the market, meaning it has closer to a 6-month supply of inventory for sale. This market is more neutral, but leaning towards a seller’s market.

Premium & Luxury Home Market: This is the top end of the market with larger homes that have even more custom features and upgrades. Nationwide, this market is growing in the number of homes for sale. In the same realtor.com article, we can see that year-over-year inventory of homes in this tier has grown by 4.7%. Today, there are more homes available in the premium and luxury space, leading to more of a buyer’s market at this end.

Bottom Line

Depending on the segment of the market and the price point you’re looking at, you’re going to need the advice of a true local market expert to help you successfully navigate the home-buying or selling process.

Hotel Plans for the Earthquake Damaged Historic Post Office in Downtown Napa

JENNIFER HUFFMAN jhuffman@napanews.com

Developers this week presented the city with refined designs for the approved boutique hotel on the site of the former Franklin Street post office in downtown Napa.

The changes were made after receiving initial comments from Napa County Landmarks and the city’s Planning Commission during a preliminary design review in June.

At that time, some reviewers thought the first version of the wrap around design overwhelmed the post office building and covered too much of it.

“I think we’ve done an over-the-top job” in both preserving and presenting the historic building, said developer Jim Keller. “It’s really exciting.”

Wings of the new hotel still wrap around the old post office building, but in this latest version there are more transparent panels, which allow greater visibility of the post office, located at 1351 Second St.

Not only is his group preserving the front of the building, it’s also preserving the sides as well – something that wasn’t explicitly required, said Keller.

“We came up with a plan that’s really going to have an awesome look,” Keller said. “I think we’ve overachieved as far as the preservation of the building.”

The changes were made after receiving initial comments from Napa County Landmarks and the city’s Planning Commission during a preliminary design review in June.

At that time, some reviewers thought the first version of the wrap around design overwhelmed the post office building and covered too much of it.

The last version was more of a rough draft, compared to the new refined design, Keller said. “We took it up another level or two.”

These new images create what he described as “a jewel box effect,” with the crown jewel – the Art Deco-style post office building — in the middle, said Keller. The historic building is the “obvious the centerpiece and focal point.”

The historic post office lobby would be fully renovated and used as the hotel lobby and bar, accommodating guests as well as the general public, according to design documents. The interior features of the post office will be visible to all, rather than turning the post office into a private office or other commercial use, said the documents.

The Third Street-facing side of the project, currently home to Zeller’s Ace Hardware, has also been refined. “We made that a little more user friendly and broke up some of the massing. The design has been elevated,” yet still fits within the parameters of the already approved project, he said.

Plans call for a 175,000-square-foot, five-story, 156-key hotel using the site of the former post office and adjacent land where Zeller’s Ace Hardware now operates.

A separate, five-story parking garage would be built at the southeast corner of Second and Randolph streets, a corner now used for surface parking.

The project will cost more than $100 million, Keller said.

Keller, a Napa developer, bought the post office building in 2017 for $2 million. He’s since partnered with Cypress Equities, based in Dallas.

The hotel’s footprint will take over much of the block along Second between Franklin and Randolph streets, and along Randolph between Second and Third streets. The Napa City Council granted a rezoning and a building agreement in November 2018.

Having financial partners lined up in advance has helped move the project along, Keller said. Being located within a state-designated Opportunity Zone, which offers tax breaks to investors, is another. Napa has two such zones, including one in downtown Napa.

As the process continues, Keller said he remains mindful of the fragile state of the post office. “If we get hit with another earthquake,” the building might not survive.

“We’re trying to move as fast as we can,” said Keller.

His next steps include final design approval from the Planning Commission and Cultural Heritage Commission. Meeting dates have not been set.

If all goes as planned, “I’m hoping in the next 12 months we can be” under construction, he said. The hotel could take two to three years to build.

The hotel project was never a sure thing. After the 2014 earthquake, the USPS originally moved to demolish the damaged post office building.

The agency said that it would cost $8 million to repair quake damage, while it would cost only $500,000 for demolition.

The Napa Franklin Station was built in 1933 with funding from the federal Public Works Administration. In 1985, it was placed on the National Register of Historic Places.

After considerable public outcry, the USPS decided to try selling the building to a buyer who could repair the structure and preserve its architectural integrity.