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THIS WEEK ON THE PODCAST · EPISODE 4

Dorado Beach Insider · You Have Arrived.

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Thank you for every idea, question and note you've sent since the first episode. The invitation stands: if you'd like to write for this newsletter, or you have a charity event or a special announcement, simply hit reply. We're happy to share it with the neighborhood.

This week we take on a question we hear at nearly every dinner: is Dorado Beach a buyer's market or a seller's market? Our honest answer is that it depends on the house. Below are Julie's notes on what truly sets a home's value here, so you don't have to write anything down.

A lifestyle decision. A friend who sold homes in Greenwich, Connecticut through a long, difficult market once told Tim why people kept buying when the numbers said rent: it's a lifestyle decision, and you have to live somewhere. Our neighbor Peter Schiff said much the same. A home isn't a stock. You live in it.

A blunt instrument. Price per square foot is a useful starting point, but for luxury and ultra-luxury homes it is a blunt one. In a small market with few sales, a single exceptional sale can pull the average up, become the next comp, and make the houses that follow look overpriced.

Adjustments. Appraisers adjust up for a beautifully restored home and down for, say, a missing pool. Those numbers differ by place, too: adding a pool here doesn't cost what it does in Austin.

What you personally value. Privacy, a quiet street away from 693, the ocean breeze, a short walk to the beach, the clubs or the tennis courts, a safe scooter ride for the children. If it fits the way your family lives, it may well be worth more to you than the average says.

Square footage isn't recorded here. In Puerto Rico, a home's square footage doesn't have to be recorded, and it isn't always measured the same way: air-conditioned space, covered space, the footprint. Sale records can also take time to appear. If you're used to complete stateside data, adjust your expectations.

Where it does work. In a building with fifteen of the same floor plan, price per square foot is quite reliable. The more custom and bespoke the home, the less it tells you. Consider it one of the top ten factors, not one of the top three.

Location, in time. As a community matures and every home ages alike, location becomes king: oceanfront, the right side of the street, the right view, proximity to the beach and the clubs.

The pressure on resale. With new construction nearby, buyers have options. A resale home that needs floors, a kitchen, or a refresh after years as a vacation rental has to be priced to reflect that work.

New phases lift older homes, to a point. As each phase of new construction is priced higher, it pulls up the value of established homes nearby. It doesn't carry them all the way, unless a home has been kept in near-museum condition.

Island wear and tear. Salt air is hard on everything outdoors. Air conditioners live on the roof, and a generator you might expect to last twenty years may give you seven to ten. Whatever lifespan you're used to stateside, cut it in half, and perhaps in half again. A new home simply asks less of you.

Two homes of 4,000 square feet. Picture a beautifully restored resale home beside a new one of the same size. Some buyers will only ever choose new. For everyone else, we'd still price the resale a nudge under new construction. A private garden and a lovely location narrow the gap; backing onto 693 with no pool and work to be done widens it.

See every house in person. A drive-by and a quick calculation are only the beginning. Walk through. See the garden. Visit in the evening and listen for the road. Some resale homes we've toured on the home tours are, frankly, finer than new construction, because someone put their heart into them.

Consider the condo. If you travel often, a condo with a beautiful view, a good floor plan and an easy walk to the amenities can be the more graceful choice. You lock the door and go.

Are prices falling? A home listed high, adjusted several times and sold below its first asking price hasn't necessarily lost value; the seller has met the market. Compare the last list price with the sale price, and the picture here is quite healthy. Some who bought at the peak are underwater, as they are across the mainland, but that is a different story.

It depends on the house. In luxury real estate, the usual labels don't hold. Sellers who don't need to sell often lease their homes or simply keep them. For homes needing significant work, it's a buyer's market. For good homes, well priced, it is a seller's market, and they sell quickly. With rentals scarce and lease prices rising, and with many new residents expected to buy once settled, we expect demand to keep growing.

Buy, sell or hold. If you love a home but not its price, you can wait, or extend your lease. If you're selling and the market won't meet your number, a lease is a graceful alternative. And if you're new to the island, visit, stay ten days, learn the neighborhoods, and then, in our view, buy sooner rather than later. Add up a year or two of rent and do the math for your family.

We're building a richer home for all of this at DoradoBeachInsider.com: neighborhood data, a community referral guide and an events page. We'd also like to begin interviewing neighbors who are making a difference here. Know someone? Hit reply.

Do you see it differently? Hit reply and tell us. We read every one, and if we've gotten anything wrong, we'll correct it.

And please share this with a neighbor or a friend who's thinking about a home here. The more of us who know, the stronger the community.

— Tim & Julie

P.S. Want more on life here? The Dorado Beach Insider book covers the neighborhoods, schools, healthcare and more, and you can subscribe and find our articles at DoradoBeachInsider.com.

Market conditions change, and every home is different. This newsletter reflects our opinions and is not legal, tax, appraisal or investment advice.

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