SUBMIT!!!

5585 E Pacific Coast Hwy #305, 90804
Price: $99,900
Beds: 0
Baths: 1
Sq. Ft.: 418
$/Sq. Ft.: $239
HOA: $207.31
Year Built: 1970
MLS#: P697667
On Redfin: 3 days
Down Payment: $20,000
Monthly Payment: $750
Income Requirement: $29,000
Description: FANTASTIC BUY ON THIS STUDIO UNIT VALUE PRICED FOR QUICK SALE!!! SPACIOUS LIVING AREA WITH TILED FLOORS, BRIGHT KITCHEN, MIRRORED CLOSET DOORS, BALCONY, VIEW OF THE COURTYARD, HOA POOL AND ONE PARKING SPACE. COMPLEX IS WALKING DISTANCE TO CAL STATE LONG BEACH AND LOCATION IS CONVENIENT TO SHOPPONG AND FREEWAYS. SUPER MOTIVATED SELLER WILL MAKE EVERY EFFORT TO WORK WITH YOUR QUALIFIED BUYERS. SUBMIT!!!

"Yo Craig, what'd you get up to this weekend?"

"Oh, not much. Just a little SHOPPONG."

I think it's hilarious when realtors include "SUBMIT!!!" in listings. You know what it kind of reminds me of?

"OBEY MY DOG!!!"

This tiny studio was repossessed by the bank in July for $79,900. They quickly got it back on the market and are now demanding a $20,000 premium that they were unable to get at auction. Can they get it?

Well, a 418 square foot unit did sell last month for $98,000, which is probably informing the bank's pricing strategy. And if you run the numbers the monthly PITIH (the "H" is for HOA) is only $750. It could rent for that, don't you think?

If that's the case, I don't think this FedEx box will last on the market for very long.

The real question is whether an investor (come on, no owner-occupier would buy this linoleum-lined prison cell and live in it themselves) would be catching a falling knife by buying right now.

For a clue, let's peruse the recent sales:

$104,000 5585 E Pacific Coast Hwy Unit 350 Sold on Apr 24, 2009
1 bd / 1 ba 418 Sq. Ft.

$125,000 5585 E Pacific Coast Hwy Unit 372 Sold on Apr 29, 2009
1 bd / 1 ba 418 Sq. Ft.

$121,000 5585 E Pacific Coast Hwy Unit 227 Sold on Jul 23, 2009
1 bd / 1 ba 418 Sq. Ft.

$98,000 5585 E Pacific Coast Hwy Unit 107 Sold on Jul 17, 2009
1 bd / 1 ba 418 Sq. Ft.

**[UPDATE: Thanks to "FYI" for informing us that those previous sales were all studios, not one-bedrooms as listed on Redfin--the one-bedrooms in this complex are 597 square feet].

Did you notice that steady (if a bit inconsistent) decline in value? Do you have any reason to believe that pattern of price destruction will suddenly cease, given the unemployment situation?

The bank apparently does.

And, man, how do you think the April 29 knife-catcher who paid $125,000 is feeling right now about that -$27,000 tune-up? Ouch. I guess the bottom wasn't in, eh Sparky?

There is also an interesting story buried in this unit's sales history:

Jul 16, 2009 - Sold $79,900
Dec 01, 2004 - Sold $156,000
Dec 14, 2001 - Sold $60,000
Apr 03, 1989 - Sold $10,000

In 2004, the lender somehow determined this single-serving shit shack was worth $156,000 ($373 per square foot! For this!), despite selling for a third of that just a few years earlier!

Really? That didn't send up red flags?

Personally, I think this will go back to its 2001 value or lower when all is said and done. Unless there is a sudden jump in demand for living quarters so cramped you can't fully outstretch your arms. But if that's the case, you might be better off stealing a car and enjoying the free rent in prison. At least that way you wouldn't have to worry about food or utility costs.