Monday, September 14, 2009

Not Selling? Try a Price Increase!

This International Tower apartment made its debut in the Girls, Girls, Girls post as an example of this guy's competition. The featured seller has since given up the ghost, but Unit #1004 has soldiered on.

The last time we checked in, he was asking $565,000 (which seemed like a deal compared to the absurd $859,000 of #2505) but time has been unkind. Now he's asking $419,000 and has slipped into short sale territory.

700 E Ocean Blvd #1004, 90802
Asking Price: $419,000
Beds: 3
Baths: 2
Sq. Ft.: 1,260
$/Sq.Ft.: $333
Year Built: 1965
MLS#: L28059
On Redfin: 305 days
HOA Fine: $635
Down Payment: $83,800
Income Requirement: $120,000
Monthly Nut: $2,900
Description: ACCEPTING ALL OFFERS !!!Attn This is a must see!! !!!!!Coastline view!!! Well Priced!!!! , fabulous views at night!! Designer decorated throughout open and spacious with glass walls floor to ceiling and a wrap around balcony!!Complex has a pool. gym and 24hr concierge!!2 parking spcaes and extra storage unit.condo is legally a 3 bedroom but has been converted to an open 2 bed contempory space !!!Steps to the beach and walk to Restaurants and all that Downtown Long Beach has to offer !!



What a loser. Seriously. 305 days on the market (technically, he's been on and off the market since 2007) and the listing agent can't be bothered to fix egregious errors that took me seconds to identify?


The view is definitely panty-dropping, but the 2005 price of $690,000 was absolutely jaw-dropping. With a $635 HOA fine on top of that?! What was this dude thinking?

By the time the in-way-over-his-head loanowner got around to putting his mistake on the market, it was too late and he damn well knew it: The (woefully optimistic) listing price in November 2008 represented a guaranteed $95,000 loss before commissions.

And instead of getting ahead of the market quickly and ridding himself of this overpriced albatross, a bolus of denial was mainlined into his system and he spent the next 10 months slowly chasing the market down. I have to give him credit for the larger price cuts toward the end--it's just that they weren't nearly aggressive enough. Take a look:

Sep 11, 2009 - Price Changed $419,000
Jul 02, 2009 - Price Changed $399,000
Jan 23, 2009 - Price Changed $449,000
Jan 09, 2009 - Price Changed $529,000
Dec 11, 2008 - Price Changed $565,000
Dec 03, 2008 - Price Changed $575,000
Nov 13, 2008 - Listed $595,000
Apr 11, 2008 - Delisted
Jan 12, 2008 - Listed
Jan 11, 2008 - Delisted
Oct 15, 2007 - Listed
Jul 01, 2005 - Sold $690,000
Oct 13, 1998 - Sold $260,000

And now here we are, asking $419,000 and there’s still no discernable buyer interest. Well no fucking shit! That's 20 Grand MORE than it was listed for during the past two months--you know, when it was rejected like a stood-up prom date. What on earth makes them think potential buyers are suddenly going to view a $20,000 “Fucktard Fee” as an incentive to buy?

I’ll never understand the mentality of short sellers like this guy, who after stacking up months and even years on the MLS, decide to suddenly jack up the price. Shitty realtor? Greed? Cluelessness? Inept asset manager at the bank? All of the above? It's confounding to say the least.

Or, could it be these two very recent comps?

$470,000 700 E Ocean Blvd Unit 1606 Sold on Aug 07, 2009
0 miles 2 bd / 2 ba 1,080 Sq. Ft.

$429,000 700 E Ocean Blvd Unit 1607 Sold on Aug 04, 2009
0 miles 2 bd / 2 ba 1,040 Sq. Ft.

Those two make $419,000 seem like a bargain, no? But what about these two recent comps:

$285,000 700 E Ocean Blvd Unit 1501 Sold on Jul 06, 2009
0 miles 2 bd / 2 ba 1,080 Sq. Ft.

$312,727 700 E Ocean Blvd Unit 1502 Sold on Apr 01, 2009
0 miles 2 bd / 2 ba 1,080 Sq. Ft.

That's $106,000 and $135,000 lower than this guy's asking price! Ouch!

Anyhow, for those of you keeping score at home, the price reductions (and inexplicable price increase) add up to a total of -$271,000 and there is still absolutely no interest. With a God awful kitchen like this, I'm not surprised:

Good grief! Look at that thing!

The monster HOA taxes have proven to be quite effective buyer repellant, but the (still) rapidly imploding values must really be scaring people off. And to top it all off, that kitchen is like Kryptonite Cap'n Crunch.


  1. What I'd like to know, is how the heck those other two units, with LESS square footage (only about a thousand), sold for 4-5 hundred K?!?!?!

    Wow, I guess there really ARE some suckers out there.............. or else I must be missing something.

    This is kinda a nice building, but at the same time, it's pretty darn old ain't it?!

    People are droppin money on these condos like they are buying some new fangled condo on South Beach or something. I just don't get it.

    And you hit it on the head with the HOA "Fine"!!!

    I've scoped a few of the lower end listings in this building before, but once I saw the HOA, I was like "see ya!".

    When the HOA fee is ridiculously outweighing the mortgage, you KNOW it's a rip.

    The ONLY place I've seen in Long Beach, that has even PARTIAL reason to ask for a high HOA fine, is West Ocean Two............. and I know that they are RIDICULOUSLY high, but at least their building is new, the facilities are BEAUTIFUL, and you'd actually feel like you'd be getting a lot in return.

    Their pool area is actually pretty roomy (AND very nice), and they also have a huge lounge area right next door, with outdoor fireplaces, window fences, nice furniture............ and right next door to all that, is a private gym (I didn't get to see the inside of that).

    PLUS, the building not only features excellent views, but even the surrounding area is all newly built property, both residential and commercial.

  2. After our "student loans means no soup for you!" mortgage debacle, we ended up renting in this building. We're in the same kind of 3/2 unit, on a much higher floor than this one (read: less street noise, better view). Our monthly nut is around $1000 less than what it would take to own this place (assuming you have $80K sitting around for a downpayment).

    We love renting here (it's a VERY nice building), but honestly, it's turned us off buying a condo forever. The problem with all of these luxury places is that, eventually (and probably sooner rather than later in bubble construction), they age and need maintenance. CA has pretty strict reserve requirements for HOAs--they're easy to meet when everything's new and nothing needs replacing, but when you're having to do maintenance and float the daily operating costs, it translates into either big monthly fees or huge special assessments (IT has opted for big monthly assessments, which probably is the best of bad choices).

    To be fair, the two cheaper units you've listed aren't exactly an apples to apples comparison: 1501 and 1502 wouldn't have an ocean view (and 1501, I think, was a major fixer). But still, rent vs. buy analysis quite clearly says rent.

    Besides, judging from the pictures, "converted to an open 2 bed contempory space" means "they took out the freaking master suite."

  3. Anonymous,

    Great points about the HOA and rent vs. buy. Deal breakers.

    "To be fair, the two cheaper units you've listed aren't exactly an apples to apples comparison: 1501 and 1502 wouldn't have an ocean view (and 1501, I think, was a major fixer)..."

    You're right, that wasn't exactly apples to apples (and they are also slightly smaller than the featured property).

    To me, units in the same building selling for (much) less bring up the issue of "what is [INSERT FEATURE] worth?"

    Major fixer? With the $135,000 in savings, new sellers will find a way to make it nice. No ocean view? Having "ocean view" from the cockpit of a new Eliminator bought in cash with the $106,000 savings might make up for it.

    Me personally, I'm willing to pay more for an ocean view. I just don't see the point in buying in one of these beachfront buildings and not having a view. But I'm not willing to pay six-figures more for it--and I guess in this case neither is anyone else.

  4. Haha--we didn't even see the point of *renting* in one of these buildings without an ocean view. I hear that in non-bubble markets, view should add around 20% (I have no idea how you would calculate that, other than as an average of what sane people are willing to spend). Anyway, like I said, we're enjoying it for now, but on the ownership front, it's just not for us.