Cole Valley “treehouse” sells for $2M over asking in sky-high Bay Area market

To get a sense of Bay Area buyers’ voracious appetites, look up to the “treehouse in the sky.”

That’s what Compass’ Michael Bellings dubbed the three-bedroom, 1,920-square-foot Cole Valley home loaded with exposed wood beams that he listed for just under $3.5 million.

Less than two weeks later, he had gotten 15 offers, half of them all-cash, and a handful for about $1 million over asking price. In the end, the frenzy pushed up the closing sale price to $5.6 million for the Belgrave Avenue property with sweeping views of the city skyline — 60 percent above the original listing.

“We couldn’t have guessed it would go that high in our wildest dreams,” said Bellings, who co-listed the property with his brother, Aaron; the two lead Bellings Brothers Real Estate Team.

But perhaps the strong demand shouldn’t have come as a surprise given the current market.

The San Francisco metro area led the nation in the number of homes that sold for 30 percent or more above asking price, with 7.4 percent, according to a Zillow second-quarter report. That’s nearly double the first quarter’s 3.8 percent, and more than five times the national average of 1.4 percent.

Overall home prices are rising as well. A recent report found that buyers in San Francisco need an annual income of $350,000 to afford a single-family property.

In the Bay Area and across markets, “relentless demand for houses and supply that failed to keep up drove competition for many houses into new territory, especially in hot markets,” according to Zillow.

For the nearly 50-year-old Cole Valley home, the sale also set a record for the neighborhood at $2,395 a foot. The view and the location itself helped, Bellings said, along with elements like a brick fireplace, original handcrafted tiles in the kitchen, varying wood finishes and sunken living room; the home was designed for a doctor and his wife, who were its only owners.

The winning offer was all-cash and the deal closed within 7 days. Bellings wouldn’t disclose the buyers, but said they already live in the neighborhood and bought the home for “extended family.”

The listing also included plans for a 10,000-square-foot mansion, signalling a potential teardown for a spec developer. Bellings said he felt compelled to have those plans drawn up for that “modern monstrosity” given the $15 million to $20 million new builds rising in the area, but said the owners would leave the existing home intact.

And a few developers did put in bids, but “owner-users were emotionally driven to offer more,” he said.

Bellings said he also considered some minor improvements before listing the property, but opted against it.

“If I had done your typical whitewall, Noe Valley renovation it wouldn’t have sold at this level,” he said. “It goes to show that charm is still in.”