Muskingum lot value?

This new 2 bed / 1 bath listing at 719 Muskingum Ave., Pacific Palisades, is asking $1.8M. "Approx 10,561 property w/amazing potential for expansion. Fabulous opportunity to build your dream home or remodel existing one. Charming ranch style with original oak floors. Updated kitchen w/granite counters opens to deck. FDR, Living room w/fp, separate brick patio, huge backyard, copper plumbing, recessed lighting & more. Don't let this rare opportunity pass your clients by...."

But this 1951 house has only 1,100 sq.ft., and it's the sixth lot south of Sunset Blvd. (red arrow on left of photo above), much closer to apartment buildings than the canyon that Muskingum houses overlook farther south. Are they claiming $1.8M is lot value? Nearby sales with three bedrooms such as 741 El Medio (3/2, $1.44M, 2/2/07) and 16050 Aiglon (3/1.5, $1.445M, 2/22/07) suggest it's not. And 16056 Aiglon (corner of Muskingum, 3/1.5) just reduced its price again, to $1.575M.

Our tiny Sunset Park house at 2416 21st St. is rather like this one, with upgrades but mostly valued for its lot. It just dropped its price again last week, $49K to $1.05M.