George Fotion

Many of my clients have asked me what the difference is between "Lower" and "Upper" Lunada Bay. Lower Lunada is comprised of the neighborhoods west of Palos Verdes Drive West and Upper Lunada Bay, those neighborhoods to the east of the Drive (but excludes the mega houses further up the hill).

As many of my clients have already learned from my postings, "value" changes as a function of the size of a home. There always exists the economic principle diminishing rate of return and this is true with real estate to the extent that larger homes within a neighborhood will sell for a lower $/sqft value than smaller homes. This is because of relative land constants and the diminishing utility of each marginal square foot.

Agents that don't understand this concept are doing their clients a disservice so when you get those mailers that say a particular area is mearsured by an "average" sale $/sqft of X ... ignore it as meaningless. The number is absolutely useless.

The graph below shows why AND serves to quantify the answer to the question of whether there is a difference between "upper" and "lower" Lunada Bay.

This study is particularly useful when considering this property that I'm currently marketing for a client now:

http://360-vre.com/client/g_fotion/08/1524_addison/flyer.htm You can see, once you look at the chart, that you must adjust around $125,000 - $150,000 higher for 1524 Addison, when comparing it to competitive properties sold in upper Lunada Bay! It's a credible reason why, when comparing to a remodeled home on Via Rivera (east of the Drive) why 1524 Addison is easily worth $1,700,000 when completed and finished!

To view a "clearer" picture of the chart, just click it.

As always, please consider me for your real estate needs; buying or selling and please refer your friends & clients!

Thank you!

At Your Service,

George Fotion
www.homeispalosverdes.com
310.346.6467