William Dean Singleton doesn’t need to read real estate articles in the Denver Post to know how tough the luxury home market is in the Denver area.
Singleton, the publisher of the Denver Post and the chairman of its parent company, MediaNews Group, has been trying to sell the house he built in Cherry Hills Village for the past four years.
“I think we first listed it at $6.5 million,” Singleton said in a phone interview on Thursday. “We’ve taken it off the market a couple of times, but basically we’ve been trying to sell it since 2007.”
The latest price for the 11,939-square-foot home on 2.31 acres is $2.7 million. The listing brochure says it has 7 bedrooms and 9 bathrooms, but Singleton described it as having 8 bedrooms and 11 bathrooms – but hey, whose counting?
What is clear he is willing to take a $3.8 million haircut from the original asking price – the equivalent of 16 median-priced homes in the Denver area – to unload it.
Drawing a line on the price
The current asking price is 58 percent lower than where he started – and that is about as low as he is going.
“I think so,” Singleton said. “I think that is the bottom.”
He and his wife paid $800,000 for the lot, records show. Singleton said they bought the ground in 1998 and completed the home in 2001.
If the home fetches $2.7 million, he will take a loss.
“Big,” he said. How big? “Really big.”
Indeed, the house itself is too big.
“I probably use 10 percent of the house,” Singleton said. “When we built it, we had young kids and they were always having friends over. We had one area on the lower level that we called the “sports floor,” with a pool table and a big-screen TV, a media room, and game machines. But now we’re empty nesters. We have a home in Cape Cod and my wife spends four months of the year there. And we have a place in Salt Lake City (Singleton also is the publisher of the Salt Lake Tribune) where my daughter and granddaughter live, so we spend time there. And since I do not drive anymore, it is inconvenient to live in the suburbs.”
Singleton still active, despite MS
Singleton has multiple sclerosis and can no longer walk, primarily using what he calls his “scooter” to zip around.
“I had multiple sclerosis long before we built the house,” Singleton said. “We designed it with an elevator, so getting around anyplace in the house on my scooter is not an issue.”
Still, Singleton is in the process of moving to a penthouse in condominium tower in downtown Denver, which will be much more convenient for him. (To learn more about that, please read Singleton moving downtown.)
“We’re going to move downtown probably in late October, but we will continue to live in Cherry Hills and to then,” Singleton said. “And we may not sell that home for another year or two, so we will go back and forth from time to time.”
Edie Marks, the broker with the Kentwood Co., who is listing the gated home with a state-of-the-art burglar alarm system at 5001 S. Holly St., said Singleton’s home is a microcosm of the Denver-area luxury housing market.
Priced below replacement cost
“This is a perfect example of what is going on in the luxury home market,” Marks said. “Here is a fabulous home on a fabulous site on 2.3 acres. In 2005 or 2006, you couldn’t even have bought the land for $2.7 million.”
Marks confirmed what Singleton said – the house was first listed for $6.5 million. She said that was before she had the listing. Metrolist, however, shows the highest listing price as $5.85 million in 2007.
Arapahoe County, for tax purposes, currently assesses the house at $3.6 million,26 percent higher than the asking price. Marks said she believes the home previously had been assessed at $4.8 million.
Marks, although arguably not the most objective observer, said she sincerely believes the home is a steal at its current price.
“If you were going to build that house today, when you look at the bricks, the quality of construction, the patios, the pool, it would cost you at least $3 million,” Marks said. “And that is not even including the land, with its magnificent views.”
In other words, at today’s asking price, it is like buying the home for less than the replacement cost of the building and getting the land for free.
Tough times for luxury houses
So why hasn’t it sold? One obvious reason is that the even with the beaten-down price tag, there are few people who can pony up the dough. If a buyer put 20 percent down and took out a 30-year-mortgage at an incredibly low 4 percent mortgage rate, the monthly principal and interest cost would still be $10,312. Plus, there’s $36,891 in annual property taxes.
But no matter how dire the economy, there are some people with that kind of scratch at their command.
“Some people who could afford a home like this right now, are just staying out of the market,” Marks said. “One of the best prospects was an old, old friend of mine and a client of mine. He looked at the house and loved it. But the problem is he is underwater on his current home.” That is, the mortgage is worth more than the sales price.
She said his $1.5 million home is “under water by $300,000 or $400,000.”
Marks tried to convince him that it would be financially worth it to take a hit on his current home to buy Singleton’s.
“I analyzed it, and said, “Look, you’re going to get a $6 million home for around $2.5 million,” Marks said. “You’re going to more than make up the loss you take on your home at the other end.”
But he wasn’t buying it.
“I was unable to convince him this was the right move,” Marks said. “He was afraid he would end up carrying two mortgages for a time, and wasn’t willing to take that risk.”
Singleton knows that he not alone in not having any luck selling, even after steep discounts.
“Part of the reason is that there are spec homes out there that were listed for $10 million and are now selling for $3.5 million, I hear,” Singleton said. “Some of them are in foreclosure and they are willing to take lower prices.”
Also, he said that he isn’t sure people crave big mansions on large estates as they once did.
“I think part of it might be 9-11,” he said. “I think (after the terrorist attacks) people may have reconsidered what is really important.”
In any case, he summed up the luxury housing market with six words: “There is just not much action.”
Date Listing price* (Singleton and his broker also recall it being listed for $6.5 million.)
May 2007 $5.875 million
November 2007 $4.995 million
June 2008 $4.795 million
June 2009 $4.0 million
July 2010 $3.8 million
February 2011 $2.9 million
July 2011 $2.7 million
To see what else is available in the Cherry Hills area, please visit this CoHomefinder.com link.
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