People are going wild over a seemingly basic California house on the market for $2 million
- A dated-looking 1950s-era home in the tech-billionaire hot spot Palo Alto is listed for $2 million.
- Its listing agent posted a video tour that shocked people who said its look didn't match its price.
The adage "location, location, location" is especially true in California, where a property's ZIP code can significantly influence its price tag.
Case in point: a newly listed 1950s-era home in Palo Alto that's causing a stir on social media — not for its beauty but for its $2 million price tag.
The 1,134-square-foot three-bedroom home is in Palo Alto's Barron Park neighborhood, which the neighborhood-ranking site Niche describes as a hip residential area with a population of just under 5,000.
One of the few original residences left on its block, the house has wood-paneled walls and vintage floral wallpaper, with floors covered in scuffed hardwood and green shag carpeting.
When the property hit the market earlier this month, its listing agent, Olivia McNally, posted a video of it on Instagram, revealing its asking price would be $2 million. To McNally's surprise, her clip received 11.9 million views, 219,000 shares, and 40,500 comments.
Many social-media users expressed disbelief that an outdated-seeming house in a modest-looking California neighborhood could fetch such a steep price.
"You can buy 20 of those in the Midwest for the same amount," one user wrote. Another asked, "Is this a joke?"
McNally, the real-estate agent in the San Francisco Bay Area who represents the home's seller, told Business Insider that the skeptics and naysayers simply didn't understand Palo Alto's real-estate market.
Palo Alto, a city of about 69,000 residents that's 35 miles southeast of San Francisco and known as the birthplace of Silicon Valley, lies at the center of the tech universe. Many firms, including VMware and HP, have their headquarters there, while others, including Amazon and Tesla, have major presences.
It's also home to many billionaires, including the Facebook founder and CEO Mark Zuckerberg and the Roku founder and CEO Anthony Wood. According to the US Census Bureau, Palo Alto's median household income as of 2022 was $179,707, above the US median household income of $74,580 in 2022. The presence of wealthy people, combined with an acute scarcity of housing inventory, has driven Palo Alto's property values to among the nation's highest.
Redfin data shows the median sale price in Palo Alto reached $3.4 million in April, far above the US median sale price of $432,900 during the same time period.
Despite its condition, the home at 604 Chimalus Drive is incredibly desirable — in part because of the land on which it sits.
"In the Bay Area, there's hardly any land left," McNally told BI. "When land does become available, people will pay a premium for the dirt. That's really what they're buying here — the dirt in this Barron Park neighborhood."
McNally said that the home's seller inherited the property from her parents, who owned it for 59 years. Initially, she planned to keep it and rent it out. However, as managing the property became difficult, she thought it would be wiser to sell it and create generational wealth for her children.
The property has already attracted 10 offers, McNally said on Tuesday, nine of which are all cash and free of contingencies.
With many offers surpassing the home's asking price, she foresees a bidding war and expects a swift sale.
"When you find a property like this — well under market value — you can either do one of two things: either completely fix it up or tear it down and rebuild it," she said. "Obviously, a developer is going to rebuild it and sell it off to someone else."
Correction: May 30, 2024 — An earlier version of this story misstated where Apple's and Intel's headquarters are. They are in Cupertino and Santa Clara, respectively, not in Palo Alto.