Courtesy of Olivia McNally/ McNally and Associates
- 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 agent said the ask was typical in the area, where owners include Mark Zuckerberg and Larry Page.
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.
Courtesy of Olivia McNally/McNally and Associates
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Many social-media users expressed disbelief that an outdated-seeming house in a modest-looking California neighborhood could fetch such a steep price.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.
Courtesy of Olivia McNally/ McNally and Associates
Palo Alto, known as the birthplace of Silicon Valley, lies at the center of the tech universe. The city of about 69,000 residents sits 35 miles southeast of San Francisco and serves as the headquarters of many tech giants, including Apple, HP, and Intel.
It's also home to many billionaires, including the Facebook founder and CEO Mark Zuckerberg and the Roku founder and CEO Anthony Wood. Consequently, property values in the area are among the highest in the nation.
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.
Courtesy of Olivia McNally/ McNally and Associates
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.
Courtesy of Olivia McNally/ McNally and Associates
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."