Another Day, Another Dollar: UPDATE III

Just wanted to update the listing history shenanigans on this "cash-only" failure:

Feb 26, 2010 - Price Changed $299,888
Feb 23, 2010 - Price Changed $299,988
Feb 17, 2010 - Price Changed $299,888
Jan 26, 2010 - Price Changed $344,888
Jan 22, 2010 - Price Changed $344,999
Jan 19, 2010 - Price Changed $356,000
Jan 11, 2010 - Price Changed $356,001
Jan 06, 2010 - Price Changed $356,002
Dec 22, 2009 - Price Changed $356,001
Dec 07, 2009 - Price Changed $356,000
Nov 09, 2009 - Relisted
Oct 23, 2009 - Delisted
Aug 23, 2009 - Listed $399,000
Jul 03, 2008 - Delisted
Jul 03, 2008 - Relisted
Jun 18, 2008 - Delisted
Jun 18, 2008 - Relisted
Jun 04, 2008 - Delisted
Jun 04, 2008 - Relisted
May 21, 2008 - Delisted
Apr 03, 2008 - Listed
Jun 11, 2007 - Sold $518,000 (-0.1%/yr)
Apr 25, 2007 - Delisted
Apr 14, 2007 - Price Changed
Mar 07, 2007 - Price Changed
Feb 13, 2007 - Price Changed
Jan 29, 2007 - Listed
Oct 29, 2004 - Sold $519,000 (27.1%/yr)
Apr 17, 2003 - Sold $359,000 (81.1%/yr)
Nov 26, 2002 - Sold $285,000 (11.2%/yr)
Jun 02, 1995 - Sold $129,000

Notably, the realtard added this to the description: "Hurry as this property will not last."

That's an odd thing to say when it has already "lasted" nearly two years on the MLS.

+++++++++++++++++++++++++++++++++

January 27: The price was "$344,999" and changed to "$344,888"

Wheeeeeeeeeeeeeeeeeeeeeeeee! This is fun!

P.S. I've decided that I REALLY like this place. I would be willing to make an (incredibly low-ball) offer...if they were smart enough to accept financed bidders. Oh well.

+++++++++++++++++++++++++++++++++++

January 22: The price was "$356,000" and changed to "$344,999"

Wow, are they finally getting serious?

+++++++++++++++++++++++++++++++++++

January 18: The price was "$356,001" and changed to "$356,000"

LOL!

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700 East OCEAN Br #2102, 90802
Asking Price: $356,002
Purchase Price: $518,000
Purchase Date: 6/2007 (right at the peak, ouch.)
Beds: 2
Baths: 2
Sq. Ft.: 1,080
$/Sq. Ft.: $330
View: City
Year Built: 1965
MLS#: Y904098
On Redfin: 137 days
HOA: $638
Down Payment: $356,002
Monthly Nut: $638
Description: THIS IS A CASH ONLY DEAL!! Property is corporate owned, we respond to offers right away. Take a look at the inside, this is chic to say the least and is perfect for somebody who just wants to move in right away. Sellers [SIC] loss, your clients [SIC] gain.

"THIS IS A CASH ONLY DEAL!!" LOL. Way to expand your buyer pool, idiot. Smart move catering only to buyers with hundreds of thousands of dollars just sitting around in coffee cans. Because we all know their numbers are growing by leaps and bounds.

Such a shame too because if they opened themselves up to a financed sale, I would definitely be interested in a clean, modern-looking condo like this. I've got the down payment and reserves, but I guess they're just not interested in selling to me. Too bad.

And just when you thought their sales strategy couldn't get any dumber, we get this:

Jan 06, 2010 - Price Changed $356,002
Dec 22, 2009 - Price Changed $356,001
Dec 07, 2009 - Price Changed $356,000

If you're going to be such a petulant moron and dick around with piss-ant $1.00 price changes, at least make them price reductions.

Hell, even the dumbest, most oblivious all-caps, mouth-breathing realtards know that "$355,999" is more psychologically appealing to buyers than "$356,000."

Given the complete lack of common sense involved here, I want to find out who the corporate owner is so I can avoid ever working for a company so obviously run by slack-jawed imbeciles.

Here is the listing history in full detail to illustrate not only the anatomy of a bubble, but the amount of financial pain in store for the seller:

Jan 06, 2010 - Price Changed $356,002
Dec 22, 2009 - Price Changed $356,001
Dec 07, 2009 - Price Changed $356,000
Nov 09, 2009 - Relisted
Oct 23, 2009 - Delisted
Aug 23, 2009 - Listed $399,000
Jul 03, 2008 - Delisted
Jul 03, 2008 - Relisted
Jun 18, 2008 - Delisted
Jun 18, 2008 - Relisted
Jun 04, 2008 - Delisted
Jun 04, 2008 - Relisted
May 21, 2008 - Delisted
Apr 03, 2008 - Listed
Jun 11, 2007 - Sold (Public Records) $518,000
May 12, 2007 - Delisted
Apr 25, 2007 - Delisted
Apr 14, 2007 - Price Changed
Apr 14, 2007 - Price Changed
Mar 10, 2007 - Price Changed
Mar 07, 2007 - Price Changed
Feb 14, 2007 - Price Changed
Feb 13, 2007 - Price Changed
Jan 29, 2007 - Listed
Jan 04, 2007 - Listed
Oct 29, 2004 - Sold (Public Records) $519,000 (27.1%/yr)
Apr 17, 2003 - Sold (Public Records) $359,000 (81.1%/yr)
Nov 26, 2002 - Sold (Public Records) $285,000 (11.2%/yr)
Jun 02, 1995 - Sold (Public Records) $129,000

In 1995, near the bottom of the last housing downturn, this place went for only $129,000. Freaking amazing. The PITI was barely more than the HOA payment! Anyhow, that 1995 owner doubled his money in just seven years and thus began a frenzy of quick flips and bubble exuberance.

Interestingly, the 2004 owner paid $519,000, but was unable to capitalize on three years of appreciation during the greatest housing bubble in history, and sold to the corporation in 2007 for $1,000 less than he paid (hopefully that transaction was the company bailing out one of its executives). Good one.

The corporate owners tried to unload less than a year after purchasing but ended up without a place for their misguided keisters in the game of Real Estate Musical Chairs. By 2008, all of the party guests had gone home and there was no one left to save them.

The loss on this apartment, assuming some fool with more stacks of cash than brain cells buys for full asking price, will be -$180,000 plus upgrade costs (which don't look cheap).

So here we are, after nearly two years on the market, farting around with one-buck price increases while the highly sought-after all-cash market gets smaller and smaller.

Not to mention, this is a less-desirable city view apartment. Why shell out all that money with no ocean view, I can hear the cash-flush buyers asking. Worse, this unit is being undercut by other city view apartments in the building:

$329,000
700 East OCEAN Ave #1102
2 bd / 1.75 ba
1,080 Sq. Ft.

$329,000
700 East OCEAN Blvd #2402
2 bd / 2 ba
1,080 Sq. Ft.

$279,000
700 East OCEAN Blvd #1902
2 bd / 1.75 ba
1,080 Sq. Ft.

Yes, they are short sales so the prices don't mean much until something closes, but just for one minute let's set aside the problems with short sales pricing (and the SS process itself) and assume you could buy one for $329,000. Your monthly payment with 20% down would be roughly $2,300--including that rapetastic $638 HOA fine. Rents for ocean-facing units are ~$2,000. The Rent vs. Buy ratio is getting awfully close for these units, meaning $329,000 seems like a decent price in the current market.

Which in turn means our seller isn't that far off.

The issue here is the myopic decision to narrow potential buyers to only those who have cash in-hand. It's seller suicide.

Why not just restrict your buyer pool to redheaded ambidextrous French-Canadian bird collectors?

In the meantime, we're looking forward to your next $1.00 price increase!

The Terrible Twos: FINAL UPDATE

Purchased 5/10/2007 - $375,000
Sold on 2/18/2010 - $338,000

To all the people who claim "renting is just throwing away money," I give you this seller who just ate a bone-crushing -$57,000 loss thanks to the glorious pursuit of home "ownership." You really showed those lowly renters!

I'll tell you one thing about which I am 100% confident: In hindsight, this lady would have much rather been "just throwing away money" renting than standing above a big, smoking crater where her bank account used to be.

Frankly, I think she's lucky to get out alive. This tidy, but tiny, little apartment has much further to fall and she's fortunate she found a sucker before the losses got any worse.

+++++++++++++++++++++++++++++++++++++++++

Today's featured seller is yet another 2007 buyer who, after finding herself underwater just two years after purchasing, is scrambling to abandon ship before her terribly timed investment blows up in her face like an IED.

Will she find the comfort of a buyer's life raft in time, or is she just rearranging the deck chairs on the Titanic?

370 WISCONSIN Ave #304, 90814
Price: $348,000
Beds: 2
Baths: 1
Sq. Ft.: 957
$/Sq. Ft.: $364
Year Built: 1967
MLS#: P709366
On Redfin: 2 days
HOA: $187
Down Payment: $69,600 ($12,180 FHA)
Income Requirement: $99,000
Monthly Nut: $2,000 ($2,400 FHA)
Description: Remodeled 2-BD Belmont Heights condo. Secluded Top, Back, Corner unit is in the Best Location in the building! Enjoy great views from the living room picture window. Spacious, open floor plan includes oversize bedrooms with large closets (with closet organizers), Bamboo flooring and dual pane vinyl windows (with nice blinds). Beautiful Kitchen has Silestone counters and ceramic tile floors. Large bathroom features both a shower and a soaking tub. Contemporary colors throughout. 2 deeded parking spaces with 4 large storage lockers! Attractive building has a sparkling lap pool, a nice BBQ area, a community garden and is pet friendly. Walking distance to trendy Portfolio coffee house and retro row on 4th St. Close to Belmont Shore & Pine Ave.

Egregious Title Case abuse aside, that is a fairly good listing description.

I think it's funny to refer to anything in a 957 square foot apartment "oversize," but considering there's only ONE bathroom, perhaps there is a bit more available square footage to play with.

Yuck, nice Pepto-Dismal countertops.

The nabe is pretty good and the (awful looking) building is well insulated from busy 4th Street.

And browsing through the photos, I'm pretty impressed with this interior. Nothing spectacular, but very clean and simple.


Furthermore, the $187 HOA fee actually gets you a pool! When was the last time you saw that?

The problem, as per usual, is price.

First, this matchbox is one of the most expensive in the area (although to be fair, it's nicer inside than the competition).

Second, the comps are playing for the Bad News Bears:

$350,000 2500 E 4th St Apt 308 Sold on Jul 24, 2009
0.05 miles 2 bd / 2 ba 1,093 Sq. Ft.

$308,741 2767 E 3rd St Apt 26 Sold on Sep 02, 2009
0.21 miles 2 bd / 2 ba 805 Sq. Ft.

$375,000 232 Junipero Ave Apt C1 Sold on Jul 07, 2009
0.31 miles 2 bd / 2 ba 1,175 Sq. Ft.

$214,000 2075 E Appleton St Unit 9 Sold on May 29, 2009
0.33 miles 2 bd / 1 ba 913 Sq. Ft.

$191,250 2033 E 3rd St Unit 3A Sold on Aug 19, 2009
0.33 miles 2 bd / 2 ba 953 Sq. Ft.

$360,000 2055 E Broadway Unit 207 Sold on Jun 19, 2009
0.38 miles 2 bd / 2 ba 1,197 Sq. Ft.

$320,000 2101 E 2nd St Unit 201 Sold on Jul 07, 2009
0.38 miles 2 bd / 2 ba 1,118 Sq. Ft.

Notably, the only three units that sold for more than $348,000 during the last six months sported an extra 200 square feet and a second bathroom. This place, as nice as it is, can't possibly compete with that in this price range.

And those sales were in June and July! Now that we are entering the winter months and holidays, the market will slow down a bit, making selling a much different ball game. This seller, if she's serious about minimizing the damage caused by these terrible two years of mistimed ownership, needs to get it in gear and hit the nitrous on price reductions.

First, the asking price is out of line with local incomes. Even if we're generous and calculate 4x income instead of my usual 3.5x, the household income requirement is still $87,000. That's $36,000 more per annum than the median income!

And because of the solo lavatory and the cramped quarters, this is not really designed for a couple, meaning the solitary occupant would have to make nearly $90,000 a year to afford this place--and even then he'd be stretching to do it.

Second, asking $364 per square foot is a pipe dream that Mario and Luigi would be proud of. We're talking pipe dream BY ANY MEASURE:

MEDIAN CONDO VALUES (List $, $/Sq. Ft.)
Alamitos Beach: $241,000, $300
East Side: $207,500, $256
90814: $247,500, $307
Long Beach: $243,000, $263
LA County: $365,000, $317

Sorry, lady. I hate to break it to you but your place isn't special and can't possibly justify the premium.

But one look at the pricing history and it becomes clear why she's reluctant to accept pricing reality:

Nov 02, 2009 - Listed $348,000
May 10, 2007 - Sold $375,000
May 22, 1987 - Sold $90,000

As it stands, if she found someone willing to make the same mistake she did and severely overpay for this tiny unit (sounds like a line from the next Deuce Bigalow movie), her loss after commissions would be -$47,000.

OUCH.

Hopefully after two years of payments she has at least that much in equity, and (assuming she finds a buyer at this ridiculous price) will break even .

But if she got an interest-only loan (which were still available in '07), she needs to be prepared to write a big fat check when she finally finds a seller (at a significantly reduced price).

I think it's going to be interesting to see what happens as 2007 buyers, many of whom listened to the "experts" about the worst of it being over and the housing crash being contained only to subprime riff-raff, unexpectedly creep underwater. It will be interesting because they won't go underwater by nearly as much as their 2004, 2005, and 2006 counterparts, but I posit many will be underwater "enough" to bail.

I'm curious to see how many '07 "owners" hang on through the downturn and years of flat appreciation, and how many pull a monkey-see, monkey-do and moonwalk away from their obligations.

A $440,000 Starter Home

I'm back from Park City, trying to regain my bearings. Have your Long Beach Housing Blog withdrawals subsided?

I'd like to thank Yikesboy for sending in today's property.

Address: 1384 QUINCY Ave, 90804
Asking Price: $439,900
Purchase Price: $540,000 (11/2005)
Beds: 2
Baths: 1
Sq. Ft.: 672 (!)
$/Sq. Ft.: $655
Lot Size: 3,526 Sq. Ft.
Year Built: 1938
MLS#: S10019372
On Redfin: 2 days
Down Payment: $88,000 (20%)/$18,000 (FHA)
Income Requirement: $126,000
Monthly Nut: $2,400 (20%)/$2,800 (FHA)
Description: 1384 Quincy Ave offers the perfect opportunity to own a great starter home on a large 3500 sq ft lot in a quiet residential neighborhood. The large gated back yard affords plenty of room for dining al fresco as well as play space for family and pets. Inside you will find a nice, cozy 2 bedroom, 1 bathroom home with many of the original features of this 1938 bungalow. Guest quarters off of the garage offer extra space to expand your living (buyer to verify permit). .. use your imagination and enjoy this rare opportunity! There is still time for the Home Buyers Tax Credit so don't hesitate to make an appointment and call this home!

If this is what passes as a "great starter home" these days, then I'm not going to bother getting off the blocks. I'll rent forever before I slap down $440,000 for 672 dingy square feet in this neighborhood.

I mean, just how warped have things become that a matchbox home miles from the ocean, asking nearly half a million dollars, is considered a "starter home?" Does that make any kind of freaking sense?

To reasonably afford this dumpy "starter home," a family just starting out has to pull in at least $126,000 per year.

That's is more than three times the median income in this zip code.

THREE TIMES!

Does this tiny, cramped 72-year-old shoebox really look like a property that the top 10% of Long Beach earners would be interested in?


Really?

Studio apartments have more square footage than this thing!

"But El Bee, the listing says 'Guest quarters off of the garage offer extra space to expand your living [whatever the fuck 'expand your living' is supposed to mean].'"

Uh, that's great (and judging by the interior of the main house, I'm sure the guest quarters are wildly impressive) but the seller--who I'll remind you is asking $440,000--can't even be bothered to verify the authenticity of the permits! What a joke!

As I'm sure you've already figured out, I think this property insanely overpriced. Just an insulting, open-handed slap to first-time buyers.

But the seller's idiotic wishing price isn't all that surprising when you consider what kind of person we're dealing with. Check out what our seller paid:

Nov 21, 2005 - Sold $540,000 (119.4%/yr)
Jun 21, 2005 - Sold $389,000

So, not only was he stupid enough to pay $540,000 ($804 per square foot!) in November 2005, but he did it just five months after someone paid $389,000.

WTF?

You're telling me there was nothing fishy about a 119% annualized return? I don't see granite, I don't see nice tile...hell, I don't even see a matching fridge!

Anyhow, assuming he could get his ridiculous $440,000 asking price, and considering this is not (yet) a short sale, he stands to lose -$126,000 including commissions.

But that's assuming a brain-damaged buyer comes along and finds this to be an exceptional bargain. Don't worry, seller, I'm sure that mush-mouthed imbecile will come along soon.

Just hang in there, Tiger.

Article: Long Beach man pleads guilty in Ponzi scheme

Some of the most high-profile Ponzi schemes were operated out of Houston (Allen Stanford) and New York (Bernie Madoff), but at least one young entrepreneur tried to put Long Beach on the map. Via KABC:

LONG BEACH, Calif. (KABC) -- A 33-year-old Long Beach man pleaded guilty to federal wire fraud charges Wednesday.

Jon Weldon James is accused of running a $33 million Ponzi scheme.

In a Los Angeles courtroom Wednesday, James admitted he defrauded more than 50 people who invested in his real estate-related offerings from late 2003 through August 2006.

James told his victims that he was using their money to invest in real estate, but in fact, he invested in only a few properties and made no profit from real estate investments.

He used funds from new investors to pay what he said were profits to his scheme's early investors.

Prosecutors say James also used investors' money for personal expenses, including his wedding, a recording studio and a production company.

The U.S. Attorney's office says he had losses of about $11 million.

James is set to be sentenced May 24. Prosecutors say he faces up to 20 years in federal prison.

In prison I have a feeling he's going to learn the definition of a "Ponzi Train."

The hard way.

Pun totally intended.

Posted Without Comment

Flipped Off Flipper

Address: 5200 East ATHERTON St #125, 90815
Asking Price: $299,500
Beds: 2
Baths: 1.75
Sq. Ft.: 1,241
$/Sq. Ft.: $241
Year Built: 1965
MLS#: S581393
On Redfin: 222 days
HOA: $420
Down Payment: $60,000 (20% down)/$12,000 (FHA)
Income Requirement: $86,000
Monthly Nut: $2,000 (20% down)/$2,200 (FHA)
Description: This SPOTLESS and HUGE 1300 sqft 2 bedroom - 2 bathroom 'C' Model has been scrubbed, painted, hardwood floors refinished, ceiling acoustic removed with new skip-trowel finish, new baseboards installed, recessed lighting in kitchen & bath, kitchen cabinets refinished, new faucets, new mirrored closet doors, vertical blinds, stainless steel appliances including cooktop, built in oven, over-cooktop microwave, dishwasher AND new dual-pane windows throughout plus slider door. It even has central air and heat!!! This is one of the nicest, cleanest, most dialed-in properties I have seen! HOA fee includes TONS of STUFF like CABLE-WATER-TRASH-PEST CONTROL-MASTER FIRE INSURANCE-PLUMBING-ELECTRICAL-ON SITE MAINTENANCE PERSON and MORE!!! GARAGE directly UNDER unit & NOBODY BELOW!!! Come and make it yours!!!

Look, I'm fine with rounding up square footage just to make it easier, but this idiot is taking it to new heights. The listing information clearly states it's 1,241 square feet, meaning you can reasonably round up to 1,250. This jackhole for some reason decided rounding up to "1300" was appropriate.

Yes, it's not exactly the height of dishonesty, but it gives you an idea of the type of realtor we're dealing with.

This apartment in the Los Altos area would make a fantastic rental for college students. In fact, when I went to CSULB I lived right down the street and really enjoyed it.

However, the area is lousy with drunk college kids, so I doubt an owner-occupier would be interested in living here.

And although the $420 HOA fine seems outrageous, keep in mind cable, water, trash, and insurance are included. Best of all, on-site maintenance (much like living in a rental apartment) is included. That means this truly is approaching the "hassle-free" living all HOAs promise but never quite live up to.

Plus, given the 1965 build date, that maintenance accessibility might come in handy.

Anyhow, I guess the question is whether $2,000 a month is a reasonable monthly nut for this unit. This flipper sure hopes so.

You see, according to Redfin Flippy McDumbstain purchased "at the bottom" in June 2009 for $262,500--a massive $117,400 discount off the original 9/2008 asking price. Given that, he probably thought he got a smoking deal.

Nov 02, 2009 - Price Changed $299,500
Oct 01, 2009 - Price Changed $309,500
Oct 01, 2009 - Relisted
Sep 18, 2009 - Delisted
Jul 14, 2009 - Price Changed $324,950
Jul 14, 2009 - Relisted
Jul 10, 2009 - Listed $325,000
Jun 30, 2009 - Sold $262,500
Mar 14, 2009 - Price Changed $325,000
Dec 16, 2008 - Price Changed $350,000
Sep 27, 2008 - Listed $379,900

And so after holding it for a whopping 10 days and calling a cleaning lady, he quickly slapped it on the market for $325,000, hoping to make a nice chunk o' change.

The buying public's response?

Not surprisingly, nobody was interested in paying a $62,500 premium over what he paid just a week and a half earlier. And now, 222 days and $26,000 in price reductions later, he's coming awfully close to just breaking even on his "investment."

It appears he has come to two harsh realizations:

1.) In 2009 the bottom most certainly wasn't in, and
2.) Destitute college students can't afford $2,000 a month in rent

Oops.

In fact, the most expensive rent I've seen in this area is under $1,600 and that's in Marbrisa (i.e. gym, pools, in-unit washer and dryer). That $400 - $600 monthly deficit means that even at $262,500 (which, on paper, seems like an okay deal for a two-bedroom), he grossly overpaid.

Worse yet, in November a nearly identical comp in the same complex sold for $282,500. You really think real estate values have shot up 10% in just four months?

Uh, okay.

As I've said before, flipping in this economic environment is A Man's Sport. It takes real stones.

In the coming months we'll see if this flipper has the minerals to keep his wishing price steady as the market continues to fall, or if he finally capitulates, drops the price, eats a financial loss, and retreats to lick his wounds and reconsider whether he's really cut out for the flipping business.

It's going to be an interesting year.

The Only Certainties in Life: UPDATE III

The price was "$825,000 and changed to $799,000"

He's (finally) approaching California's conforming loan limit. Will it be enough?

P.S. How many "lowball" $800,000 offers do you think he dismissively rejected last year?

++++++++++++++++++++++++++++++++

The price was "$875,000" and changed to "$825,000"

Now we're getting somewhere!

P.S. We're at 84 DOM, and the illiterate realtor still hasn't fixed the "Elementry" typo. Great work, champ!

++++++++++++++++++++++++++++++++

The price was "$899,000" and changed to "$875,000"

Hey, at least he's under $600 per square foot now!

++++++++++++++++++++++++++++++++

I've been traveling more than George Clooney's character in Up in the Air. Savannah was pretty cool and Austin was a blast as always.

Anyhow, I'm back and have been checking out this bungalow LBCee sent in:
ADDRESS: 5266 East APPIAN Way, 90803
ASKING PRICE: $899,000
BEDS: 3
BATHS: 2.75
SQ. FT.: 1,471
$/SQ. FT.: $611
LOT SIZE: 5,000 Sq. Ft.
YEAR BUILT: 1940
MLS#: P709784
ON REDFIN: 35 days
DOWN PAYMENT: $179,800
INCOME REQUIREMENT: (4x income): $225,000
MONTHLY NUT: $4,900
DESCRIPTION: Charming Belmont Park cottage style home. Included in sq. ftge. is detached guest quarters with 3/4 bathroom. Living room has brick fireplace. Dining room opens to kitchen and living room. Upgraded electrical and plumbing, forced air heat, A/C, hardwood floors throughout, plantation shutters, skylights, crown moldings. Spacious grassy backyard. Oversized 2-car garage. Walking distance to award winning Lowell Elementry, Rogers Middle School, Alamitos Bay and Marine Stadium.

How awesome is it that they misspelled “Elementry”? HAHAHAHAHAHA.

As the listing description notes, the 1,471 square feet also includes detached guest quarters. Translation: The main house, where you are going to live, is as cramped as a Hong Kong cemetery.

And some of these photos highlight just how tight things are:
Is that even a Queen bed? I would guess the primary residence is sub-1,000 squares. As LBCee said, “I’ve had closets bigger than the bedrooms in this house.”

But, as we all know, people are enthusiastically willing to give up personal space if it means living in prime areas of Long Beach. And they’re more than glad to pay a substantial premium to get there. So let’s not lose sight of just how awesome this location is—just 300 feet from Marine Stadium. It ain’t beachfront, but this neighborhood is D-E-S-I-R-A-B-L-E.

H-O-W-E-V-E-R, the underlying desire of buyers to get into this nabe is often grossly overestimated by sellers, and we get what we have here today: Yet another delusional Long Beach seller who thinks he’s special and immune to the realities of the current market.

With a $611 per square foot asking price, this turd burglar is blatantly insulting potential buyers. Conversely, the batshit-insane $899,000 price tag makes nearby sellers very happy because their larger spreads look positively cheap by comparison.

To make matters worse, this overpriced wonder isn’t even that impressive. Sure, it’s ultra clean and sports some upgrades, but scope these photos and tell me with a straight face that you’re looking at a NINE HUNDRED THOUSAND DOLLAR HOUSE.
Really? That justifies being the most expensive listing in the neighborhood?

The only certainties in life are Death, Taxes…and this cocky asshole reducing his price.

As LBCee pointed out, “You'd have to knock $250k right off the top of this listing price to get to around $500/sq.ft." That's the average price per square of listed homes in this area. And considering he paid $780,000 for this 69-year-old saltine box in early 2005, the lowest he can really go (taking commissions and upgrade money spent into account) is roughly $840,000 without taking a loss. There's no way that will get the job done.

Newsflash, you time-wasting fool: If you want to sell, your billfold will take a massive hit. End of story. So start pricing realistically and get it over with.

But I'll tell you one thing: If this place sells for $899,000 I hereby declare RE in the LBC over and done with. I will close up shop immediately. There would simply be no point documenting Long Beach real estate anymore because if someone is dumb enough to drop nearly a million bones on this average-looking sardine can, it means the world has gone completely fucking mad and it’s only a matter of minutes before water jugs and ammo rounds are the new must-have status symbols.

Everybody Must Get Stoned

Wow, two whole photos!

Address: 564 North BELLFLOWER Blvd #201, 90814
Asking Price: $345,000
Beds: 2
Baths: 2
Sq. Ft.: 1,028
$/Sq. Ft.: $336
Year Built: 1970
MLS#: P721365
On Redfin: 2 days
HOA: $357
Down Payment: $14,000(FHA)/$70,000 (20% down)
Income Requirement: $100,000
Monthly Nut: $2,400 (FHA)/$2,100 (20% down)
Description: Completely remodeled Stoneybrook Villas 2 bedroom 2 bath condo overlooking main greenbelt & pool area. Close to elevator & parking. Enter to gleaming hardwood floors, totally remodeled granite kitchen, updated bathrooms, large bedrooms, both with walk-in closets, huge patio with access from both bedrooms & living room. You will truly enjoy this great location and excellent condition.

In The Year of The Cock (2005), today's seller purchased this little apartamento for a cerebellum-melting $450,000. That's right, almost half a million clams.

And now, after almost exactly five years (anybody else smell an Option ARM recast?), he's got it on the block for $345,000. Including commissions, Scuba Steve here (get it? Because he's underwater? Hey-ohhh!) stands to lose $125,000.

This, I'll remind you, is not a short sale (yet). And even if he had a conventional loan (which I seriously doubt, given the purchase date), there's no way he has enough equity to escape without a brutal hit to his pocketbook.

Below is the listing history. I want you to pay particular attention to the activity between 1988 (near the last peak) and 1999 (near the beginning of the new bubble):

Feb 11, 2010 - Listed $345,000
Jun 09, 2008 - Delisted
Apr 24, 2008 - Listed
Jul 25, 2005 - Sold $450,000 21.7%/yr
Sep 27, 1999 - Sold $143,000 -1.2%/yr
Nov 17, 1988 - Sold $163,000

That's right. The housing collapse in the early 90s wiped out that owner's value to the point where it took him 11 years to approach his purchase price. And he still had to cough up tens of thousands of dollars to get rid of it.

You are seeing the future of those who purchased during the peak years of The Great Housing Bubble. And this time around it may take even longer for a return to peak prices.

By the way, get a load of the 1999 buyer's impeccable timing. He bought at a good time, unloaded to this sucker at a great time, and walked away with three times the amount he initially invested six years earlier. Wow. (Of course, he probably just leveraged that money into another woefully overpriced property and is now in a similar situation under the sea.)

As far as this property goes, it seems alright. Nothing special. The kitchen doesn't seem to be much to write home about and although the floors look nice, I don't see much to differentiate this apartment from any number of nearby, similarly priced properties.

I guess you get two garage spots, a pool, and tennis courts (which you will never, I repeat, never use), but you also have a $357 HOA, two common walls, and those garage spots are tandem. Yuck.

Oh, did I mention the community laundry? DEAL KILLER.
Given those significant disadvantages, it's clear this asking price is way out of line with reality. Hell, Stoney Brook two-bedrooms are renting for only $1,625! That means to pencil out in a rent vs. buy calculation, the price would need to be around $230,000!

Think that's too low?

Well, consider that the median income for this zip is $57,182. If you calculate 4x income (which is stretching it, but common for Southern California buyers) you get a value of $229,000.

Need more evidence this asking price is nuttier than squirrel shit?

If you apply a 4% annual appreciation (ignoring the bubble and subsequent crash) to the 1999 purchase price of $143,000, the current value would be $220,000. Add in some money for minor upgrades (the claim that this place is "completely remodeled" is "completely made up") and you're at about $230,000.

Still need more convincing?

On a $230,000 property, the monthly nut with a conventional loan would be about $1,500. Assuming a family makes the median income of $57,182, if you apply a 31% debt-to-income ratio (which even the governement is now using as its absolute cutoff for most mortgage modifications) would be...drumroll please...$1,477.

Well would you look at that? Four unbiased (albeit quick and dirty, so give some wiggle room to those figures) calculations versus one delusional seller. Who you gonna believe?

And given the relatively high HOA fee and dreadful apartment living offered here, $230,000 is about what I'd pay.

But I'm smart.

Many people are not.

Which is why I expect this flat to sell relatively soon to a stoney buyer for about $315,000. And although he'd be buying at a significant discount to the peak price, he'll quickly learn, just as the 1988-1999 owner did, that prices have to hit a bottom before they can start climbing to the top again...and that can take a very, very long time.

Happy Valentine's Day, Y'all!

LA Times: Valentine's Day is all about eating out

(yes, that is the actual headline)

LBPost: Foreclosure Up-Tick May Signal Impending Flood

Thanks to Mike in LBC for sending this article in. From Don Jergler at the LBPost:

A foreclosure report issued today shows a month-to-month drop in foreclosure filings in January, although if history repeats itself that uptick may be a mere graphical blip before an impending storm of negative data on rising foreclosure filings on the horizon, some real estate experts say.

...

Foreclosure activity fell by double-digit percentages from the previous month in California, where one in every 187 housing units received a foreclosure filing. California’s foreclosure rate ranked third-highest among the states.

It’s much the same in Long Beach and surrounding areas, where some local Realtors believe there’s a possibility of a flood of foreclosures coming—the calm before the storm so to speak.

“I find it hard to believe that people are surprised by these new numbers,” says Jeremy Colonna, a broker with Colonna & Co. Realty in Belmont Shore. “With unemployment continuing to rise, short-term interest-only loans beginning to adjust and lenders being forced to attempt modifications on borrowers with no hope of being able to make any kind of reasonable payment at all, the circumstances were inevitable.”

And Colonna believes more is yet to come. “Even with lenders like Wachovia, Wells and GMAC really trying to streamline their short-sale process, there are still going to be massive numbers of foreclosures on the horizon. Unfortunately, I have a feeling that many of the sales that took place the latter half of last year may be destined for the same fate. One of the side-effects of living in the United States is that our society is so optimistic that we will often times use more hope than logic in interpreting data. I don't think that prematurely predicting the end of the housing slump has done anyone, even Realtors, any favors.” [OUCH]

...

Doherty also offers some answers: “What I do know is that in our area, the market is absorbing the REOs as quickly as they are coming on the market if they are priced right. We could certainly use more of them. The demand is huge and buyer interest and activity remains high, at least until the homebuyer tax credit comes to an end on April 30. Demand could also wane if interest rates rise when the Federal Reserve ends its support of the housing and mortgage industry when the program for purchasing mortgage back securities from FNMA, FHLMC and GNMA expires at the end of the first quarter [NOTE: THIS WILL NOT HAPPEN]. It’s been an interesting ride and we’re far from finished.”

Dennis Berry, a Keller Williams Realtor, asked around KW company offices in Los Alamitos and Long Beach and collected for Realty Bites a few offhanded remarks on the report from some of his fellow Realtors, which I think balances out some of the negative housing news we are hearing out there lately:

•“Housing seems to be doing okay in the Long Beach area.”
•“Our office had a busy December and a slower January, but February seems to be picking up.”
•“People are still interested in the tax credit.”
•“Our active inventory is around 959 in Long Beach, so there isn’t a lot of properties out there.”
•“Standard sales make up almost half the actives in the MLS.” [WOW. THAT IS SOME HARD-HITTING DATA. A COMMISSION-HEAD ASKING OTHER COMMISSION-HEADS FOR COMMISSION-DRIVEN ANECDOTES. I APPRECIATE THE ATTEMPT TO ADD BALANCE TO THE ARTICLE, BUT THE LACK OF DATA TO SUPPORT THAT OPTIMISM ONLY SERVES TO HIGHLIGHT HOW GRIM IT IS OUT THERE. BY THE WAY, SOMEONE SHOULD ASK THAT LAST DUMMY WHAT THE OTHER HALF OF MLS ACTIVES ARE.]

...

Frankly, I don't think we'll see a surge of REO inventory this year. Or the next year. Or the next. We've seen how the extend and pretend games can go on pretty much indefinitely, and I see no reason for foreclosures to suddenly start in earnest. I hope I'm wrong, but the idea that there will be some enormous "tsunami" seems rather far-fetched at this point.

P.S. Check out this interactive unemployment map by county: http://cohort11.americanobserver.net/latoyaegwuekwe/multimediafinal.html

Yikes!

Time Keeps on Slippin'

Yet another brain-dead idiot who doesn't bother to include interior photos of the property. You should be embarrassed for yourself.

383 BAY SHORE Ave #308
Asking Price: $428,900
Long Beach, CA 90803
Beds: 1
Baths: 1
Sq. Ft.: 792
$/Sq. Ft.: $542
Year Built: 1965
MLS#: P711907
On Redfin: 82 days
HOA: $255
Down Payment: $85,780
Income Requirement: $123,000
Monthly Nut: $2,500
Description: Bay view condo on desirable Alamitos Bay. Floor to ceiling windows for enjoying the great water view. Upgraded designer kitchen. Potential to set sail from your own 32 foot boat slip. Beach & Marina at your front door. Walk to fine dining & shopping in Belmont Shore & Naples Island. Bike path for great biking. Pet friendly for up to 25 pounds.

Now, before you choke on your Cheerios at the asking price of $428,900 for less than 800 square feet, keep in mind that a slightly larger unit sold just last month for $430,000.

Also consider that this property apparently comes with its own boat slip. Of course, most individuals who pull in the required $123,000 per year and actually need a 32’ slip probably aren’t interested in living in a cramped one-bedroom apartment, but I digress.

I’m not a boat owner, but I would imagine that if you could rent the apartment out to someone for close to the monthly mortgage payment, it would be worth buying so you could have use of the slip.

What does a slip cost per month? Kaos? Anyone?

And is it even really included? The description says “potential to set sail from your own 32 foot boat slip.” Potential. What a curious word choice.

I mean, there’s potential for anything. There’s potential to shoot skeet from my balcony whilst wearing nothing but a miner's helmet, but that doesn’t mean a double-barrel and a stack of pigeons is included in the purchase price.

I’m operating under the assumption that the slip is actually included (even though the listing information doesn’t mention anything about the slip rights) and the word "potential" actually means "if you have a boat..." Otherwise that has got to be the dumbest goddamn marketing ploy known to man.

Anyhow, the location is amazing, the view is incredible...it doesn’t get much better than this for single living. And although I have no idea what this joint looks like on the inside (doing a heckuva job, realtor!), the listing description mentions an upgraded kitchen. Might be a sweet little spot.

The only question is price. There's no way in holy hell this thing rents for $2,500 a month. Impossible.

And let's say a boatless buyer decides to buy it with the idea of living there and renting out the slip. From what I can tell, it only costs a few hundred bucks a month to rent a slip in Long Beach--not nearly enough income to offset that massive monthly nut. And not enough to justify a $542 per square foot asking price (however, I may be downplaying the value of that slip--I'll wait to hear from some of you boaters before I dismiss it).

It's worth noting that larger nearby apartments sans slips are selling for $100,000 to $200,000 less.

$229,000
6232 North MARINA PACIFICA Dr Key 15
Sold on Dec 28, 2009 0.31 miles
1 bd / 1 ba
873 Sq. Ft.

$229,000
6232 Marina Pacifica Dr N
Sold on Dec 29, 2009 0.31 miles
1 bd / 1 ba
873 Sq. Ft.

$360,000
201 BAY SHORE Ave #207
Sold on Dec 03, 2009 0.36 miles
1 bd / 1 ba
879 Sq. Ft.

$165,000
8123 MARINA PACIFICA Dr
Sold on Jan 06, 2010 0.37 miles
0 bd / 1 ba
650 Sq. Ft.

$235,000
5108 South MARINA PACIFICA Dr Key 20
Sold on Nov 13, 2009 0.41 miles
1 bd / 1 ba
873 Sq. Ft.

$135,000
5211 South MARINA PACIFICA Dr Key 20
Sold on Sep 13, 2009 0.43 miles
1 bd / 1 ba
873 Sq. Ft.

$262,500
6104 MARINA PACIFICA Dr
Sold on Dec 22, 2009 0.46 miles
1 bd / 1 ba
873 Sq. Ft.

$389,000
5898 East NAPLES Plz #101
Sold on Sep 18, 2009 0.46 miles
1 bd / 1 ba
703 Sq. Ft.

$315,000
5959 East NAPLES Plz #104
Sold on Dec 01, 2009 0.58 miles
1 bd / 1 ba
810 Sq. Ft

Is it worth that kind of premium to have your own slip? Or would you be better off saving the $200,000 ($200,000!) and just renting a slip from someone else for a few hundo a month?

I think this price is way too high. Some might point to the aforementioned $430,000 comp as evidence this price is in the ballpark. However, why did that other unit sell quickly while this one has been rotting on the market since November with no interest?

Whatever the reason, it looks like it will need another price reduction to get buyers' attention. Unfortunately for this seller, he doesn’t have much room to reduce because at $428,900, he's already $9,100 below his 2005 purchase price.

Dec 21, 2009 - Price Reduced $428,900
Nov 21, 2009 - Listed $435,900
May 27, 2005 - Sold $438,000 (30.2%/yr)
Jul 01, 2003 - Sold $265,000 (4.1%/yr)
Jul 26, 2001 - Sold $245,000

Add in -$25,000 in commissions, and we're looking at a substantial loss (although, with five years of those bloated monthly payments, you have to imagine there's at least some equity to offset that).

But I want to focus on non-losers for a minute. Check out the profit margin the 2003-2005 owner enjoyed by selling to this sucker right before the peak! 30.2% per year?! Bond guru Bill Gross would put his left nut in a Salad Shooter for those kinds of returns. He cleared nearly $200,000 after less than two years of ownership.

Nice timing, and nicely done!

Sadly, our seller got stuck with the hot potato and is nervously hoping for a big Spring Bounce to save him from the inevitable. Maybe he'll get lucky in the next few months and the loss won't be that bad.

By the way, is anybody else noticing more 2005 purchases like this popping up? I have a sneaking suspicion, given the purchase dates, that many of these are Option ARMs exploding like seven-ton daisy cutters.

Landlocked in "The Other" Long Beach: FINAL UPDATE

Jul 12, 2001 - Sold $135,000
Mar 23, 2006 - Sold $380,000 (+24.7% per year)
Aug 21, 2009 - Listed $229,900
Feb 8, 2010 - Sold $203,000 (47% loss in value in 48 months)

I think $203,000 is still too much money for this dump, but at least the bank's long, painful journey is over with. But we taxpayers still ate a shit sandwich on that one.

This sales price of $203,000 is 4x times the median income--stretching it, but fairly common for SoCal--so they might be able to keep up with the loan payments. But this was most certainly an FHA loan requiring no skin in the game, so let's just hope they can stay employed and keep their current hours, nothing needs repairing or replacing, and life doesn't have any surprises in store (fat chance)...otherwise we'll be eating that loss as well.

*********************************************

The list price was "$229,900" and changed to "$219,900"

But wait, when you originally listed this dump for $230,000, the listing description claimed, "This property is priced for a quick sale."

But that was 74 days ago. Perhaps "quick" wasn't the best word choice.

So are you saying now it's REALLY priced for a quick sale? Or are you just going to pepper buyers with your incessant bullshit until the next measly 4% price cut?

Then I imagine it will REALLY, REALLY be priced for a quick sale, right?

But who am I to question whether $220,000 is a fair, accurate price? After all, you're the "experts" who three years ago valued this rat's nest at $380,000--clearly you know what you're doing.

*********************************************

The Caspian Sea is the largest enclosed body of water on the planet. It's said that about 5.5 million years ago, due to geological shifts and other factors, the "sea" became landlocked and essentially became a salt-water lake.

How appropriate that today's property on Caspian Avenue is in such a sketchy area of "The Other" Long Beach (it's practically Compton) and is in such rough shape that is essentially landlocked, i.e. unsellable, in a non-bubble environment. The bank is going to take it in the shorts on this one, but it's pricing as if this house has any redeemable qualities outside of bulldozer practice.


3555 Caspian Ave, 90810
Price: $229,900
Beds: 2
Baths: 1
Sq. Ft.: 832
$/Sq. Ft.: $276
Lot Size: 2,500 Sq. Ft.
Year Built: 1970
MLS#: P700253
On Redfin: 12 days
Down Payment: $46,000
Income Requirement: $66,000
Monthly Nut: $1,300
Description: Truly affordable 2 bedroom home. This property is priced for a quick sale. Opportunity knocks...will you answer the door? This property features tile and carpet flooring, seperate living room and den, updated bath with pedestal sink, updated kitchen with what appear to be newer cabinets and what appear to be granite countertops, and attached 1 car garage. This property has a usable rear yard as well.

So, judging by the photos, you're buying a two-bedroom, one-bath garage. Sweet.

"Opportunity knocks...will you answer the door?" Hell no! Every weekend that opportunity to catch a falling knife is banging on my door--he's worse than the Jehovah's Witnesses!

"and what appear to be granite countertops"? This again? Look, geek--when you're asking hundreds of thousands of dollars for a POS shack, take the fucking time to figure out what you're selling. I mean, don't you think granite countertops would be a plus? Maybe something worth confirming?

That's like saying, "...and what appears to be a swimming pool." It either is or it isn't.

And "seperate"? There seems to be a growing trend of realtors misspelling this word. Maybe the NAR has enough pull to convince Webster's to change the spelling and make me look like the illiterate one.

If you can believe it, near the peak this dilapidated petri dish sold for $380,000. $457 per square foot? ZOINKS!

Aug 21, 2009 - Listed $229,900
Jul 13, 2009 - Sold $136,000
Mar 23, 2006 - Sold $380,000
Jul 12, 2001 - Sold $135,000
Jun 12, 2001 - Sold $100,100
Jan 12, 1990 - Sold $1,000

Then the bank took it back this July for $136,000 (Weird. That would indicate the former loanowners had several hundred thousand dollars in equity/down payment. Or maybe a second mortgage?). Now the lender, who couldn't be bothered to make this shithole presentable, is getting cocky and demanding a $96,000 profit. You're going to need a golden horseshoe up your rectum to pull that one off, pal.

You see, the listing agent claims $229,900 is "truly affordable," but by what measure? Definitely not price per square foot:


And certainly not recently sold comps:

$174,250 3557 Caspian Ave Sold on Jun 16, 2009
0 miles 2 bd / 1 ba 832 Sq. Ft.

$200,000 3521 Baltic Ave Sold on Jun 26, 2009
0.06 miles 3 bd / 2 ba 960 Sq. Ft.

$130,000 3568 Denver Ave Sold on Jun 30, 2009
0.08 miles 2 bd / 1 ba 708 Sq. Ft.

$129,000 3608 Denver Ave Sold on Jul 31, 2009
0.09 miles 2 bd / 1 ba 836 Sq. Ft.

$481,676 3612 Denver Ave Sold on Jul 07, 2009
0.1 miles 1 bd / 1 ba 720 Sq. Ft.

$150,000 3625 Delta Ave Sold on Jun 24, 2009
0.13 miles 1 bd / 1 ba 634 Sq. Ft.

$160,000 1801 W Arlington St Sold on Jun 30, 2009
0.23 miles 3 bd / 2 ba 874 Sq. Ft.

$205,000 1747 W Cameron St Sold on Jun 19, 2009
0.28 miles 2 bd / 1 ba 659 Sq. Ft.

How the hell did the lender figure $229,900 for this turdpile is "priced for a quick sale"?

Have they even looked at an overhead map? It actually looks like a decent little street looking at Street View, but you clearly are not concerned with your personal and property safety if you buy in this area of LB. And you aren't terribly concerned about your family's health if you purchase so close to power lines. And then there's the interior:

Uf da! Get me a Swine Flu mask!

You might point out that some people don't have many options financially and a $1,300 monthly payment is all they can afford. That's true, but wouldn't they be better off renting a nice, big, clean condo in a much safer neighborhood? $1,300 can get you a lot in LB these days, and in very decent areas. And they wouldn't need to worry about losing equity as the market for these undesirable digs gets absolutely crushed in the coming months and years.

In other words, $230,000--ERRRR...sorry: $229,900--is a total, unabashed rip-off and the only thing this is priced for is a good ol' fashioned rot session on the MLS.

Reuters: US food stamps set ever-higher record-32.8 million

Folks, we are in for a difficult, protracted slog. From The Guardian/Reuters:

A record 38.2 million Americans were enrolled in the food stamp program at latest count, up 246,000 from the previous month and the latest in record-high monthly tallies that began in December 2008.

...

USDA estimates up to $58 billion will be spent on food stamps this fiscal year, which ends Sept 30, with average enrollment of 40.5 million people. Food stamps were renamed the Supplemental Nutritional Assistance Program [A rose by any other name...] in 2008.

Participation has surged since the financial-market turmoil of late 2008 and has set records each month since December 2008, when it reached 31.78 million. Enrollment is highest during times of economic distress.

Anyone want to take a stab at finding a silver lining here?

Forget the Mortgage, I'm Paying My Credit Card Bill

Luke Mullins at U.S. News & World Report casts a dark cloud over any pollyanna recovery talk:

Amid high unemployment and sliding home prices, a growing number of struggling consumers are doing what was once considered unthinkable: paying their credit card bills instead of their mortgages. A recent study developed by TransUnion found the percentage of Americans who were current on their credit cards but behind on their mortgage increased to 6.6 percent in the third quarter of 2009, up from 4.3 percent in the first quarter of 2008. Meanwhile, the share of consumers making mortgage payments on time but behind on their credit cards moved in the opposite direction, sliding from 4.1 percent to 3.6 percent over the same time period.

The data reflects a "fundamental paradigm shift" in the way consumers prioritize payment of debt obligations, says Ezra Becker, of TransUnion. "This is dramatically different," he says. "It is a clear manifestation of the dynamics that lead up to the recession and the recession itself."

Before the housing crisis, bankers typically operated under the assumption that homeowners would do whatever possible to remain current on their mortgage--even if that meant falling behind on other bills. "It used to be that the mortgage was sacrosanct," says Keith Gumbinger of HSH.com. "You paid it before anything else." But a combination of factors linked to the current economic mess--falling home prices, high unemployment, and tight consumer credit--have lead many consumers to prioritize credit card payments above mortgage bills. "This sort of thing is what keeps bankers awake at night," Gumbinger says.

...

Still, another key factor is the disparate consequences associated with defaulting on a mortgage versus those for falling behind on a credit card. National anti-foreclosure efforts have worked to significantly extend the time period between a borrower's initial mortgage default notice and the foreclosure itself, says Edward Pinto, a former chief credit officer at Fannie Mae. "The last thing you have to worry about at this juncture is paying your mortgage because by the time they foreclose it could be six months, 12 months, or a year and a half down the road," Pinto said.

A credit card, however, can disappear much quicker, Becker says. "If you go a couple months without paying your credit card bill, they are going to close your account," he says. "You won't be able to access your credit."

...

Didn't Even Last Two Years

3101 East 2ND St Unit 4C, 90803
Asking Price: $447,000
Beds: 3
Baths: 1.75
Sq. Ft.: 1,481
$/Sq. Ft.: $302
Year Built: 1963
MLS#: P716383
On Redfin: 34 days
HOA: $175
Down Payment: $17,880 (FHA)
Income Requirement: $128,000
Monthly Nut: $2,900
Description: Spacious Bluff-Park-Condo in great location . .. This top floor light and bright unit features 3 bedrooms, private balcony with peek-a-boo ocean view, newer paint and carpet, attic access, storage areas, and stylish mid-century designer accents throughout. .. Walk to the beach, LB Art Museum, restaurants, and shops. .. Well maintained smaller complex. Must See!

Dang, this is a pretty sweet place. Three bedrooms, nearly 1,500 square feet, a balcony, cheap HOA fee, and in a killer neighborhood. The solo garage spot is a bummer, but hey, you can't have it all.

One thing I like is how the owner used those "stylish mid-century designer accents" to create an overall 50s/60s vibe. I mean, check out this door knob:

And the original stove knobs and old school overhead vent:

Yeah yeah, some might say that shit just looks old, not "designer" (and they'd be right) but you have to admit the seller did a good job incorporating those outdated elements into a cohesive design theme. In a day where pergraniteel is "standard," it's nice to see somebody work with what they have and pull it off reasonably well.

The only major drawback I can see (besides the price, duh) is the proximity to busy-ass, terribly noisy Broadway.

But the good news is you're right across the street from Taco Bell!

I love that particular T-Bell because it's the only one on the face of the planet without a freaking drive-thru.

In any event, this unit appears to be on the 2nd Street side so the traffic noise probably isn't that bad.

So now that we've covered what the seller did right, let's focus on what they did wrong and the reason this property is a topic of discussion.

The sales history reveals this seller mistakenly listened to the bottom callers of 2008 and took them at their word that "the worst is definitely over," and agreed to pay $475,000 for this bad boy. And now, just 22 months later, he or she is trying to sell for a substantial loss. Peep:

Jan 07, 2010 - Price Changed $447,000
Jan 06, 2010 - Listed $449,000
Mar 25, 2008 - Sold $475,000
Jan 11, 2008 - Price Changed $499,000
Oct 26, 2007 - Price Changed $529,000
Sep 14, 2007 - Price Changed $559,000
Jun 23, 2007 - Listed $579,000
Jun 18, 2007 - Delisted
Apr 04, 2007 - Price Changed
Jan 31, 2007 - Listed

The interesting thing is that the previous owner had it on the market for almost exactly a year before our dim-witted knife-catcher decided to step up and take on more than he could chew.

Which means during that year he watched as the price dropped $20,000, then $30,000, then another $30,000 before buying at yet another $25,000 discount AND SOMEHOW BELIEVED THE PROPERTY VALUE WOULD MAGICALLY STOP PLUMMETING.

WTF was he thinking?!

By stupidly jumping in long before the bottom and catching this rusty Ginsu, he just cost himself a minimum of $50,000. And that entry-level loss tragically depends on finding some burlap-head willing to part with nearly $450,000. Good luck with that!

I could understand if this throwback was fully updated, but for this kind of loot most buyers will be looking for detached homes or similarly sized condos on Ocean Blvd. with real ocean views.

But judging by the comps, and a price per square foot about to drop below the $300 mark, this seller might be able to find a greater fool for around $425,000. That still means a major loss, but at least he'll be free from his colossal error in judgment.

At any rate, I think this charming apartment, in a killer neighborhood, is quite desirable...just not $447,000 desirable. That seems woefully overpriced in this ever-competitive market.

Guess we'll just have to wait for Mr. Market to tell us who's right.

Remodeling Rules

Via Mish, some bad news for Long Beach buyers purchasing properties built before 1978 (which, let's face it, is most buyers):

What Remodelers Need to Know About the EPA's Lead Paint Rule

The U.S. Environmental Protection Agency's Lead: Renovation, Repair and Painting rule governing the work of professional remodelers in homes where there is lead-based paint was published in the Federal Register on Earth Day, April 22. The rule will take effect in April 2010.

The rule addresses remodeling and renovation projects disturbing more than six square feet of potentially contaminated painted surfaces for all residential and multifamily structures built prior to 1978 that are inhabited or frequented by pregnant women and children under the age of six.

It requires a cleaning inspection after the work is completed and grants the remodeler flexibility in determining the size of the work area, which can reduce the size of the area subject to containment.

The EPA rule also lists prohibited work practices ― including open-torch burning and using high-heat guns and high-speed equipment such as grinders and sanders unless equipped with a HEPA filter.

Additionally, the rule establishes required lead-safe work practices, including posting warning signs for occupants and visitors; using disposable plastic drop cloths; cleaning the work area with HEPA vacuuming and wet washing; and individual certification through a training course.

...

1. Training and Certification

Beginning in April 2010, firms working in pre-1978 homes will need to be certified. Along with the firm certification, an employee will also need to be certified as a Certified Renovator. This employee will be responsible for training other employees and overseeing work practices and cleaning. The training curriculum is an eight-hour class with two hours of hands-on training. Both the firm and Certified Renovator certifications are valid for five years. A Certified Renovator must take a four-hour refresher course to be recertified.

2. Work Practices

Once work starts on a pre-1978 renovation, the Certified Renovator has a number of responsibilities. Before the work starts this person will post warning signs outside the work area and supervise setting up containment to prevent spreading dust.

...

Clean up procedures must be supervised by a certified renovator.

3. Verification and Record Keeping

After clean up is complete the certified renovator must verify the cleaning by matching a cleaning cloth with an EPA verification card. If the cloth appears dirtier or darker than the card the cleaning must be repeated.

A complete file of records on the project must be kept by the certified renovator for three years.

...

CLICK HERE FOR FULL ARTICLE...

To paraphrase Mish, these regulations, going into effect in mere months, virtually guarantee fixing up a house in the LBC just got a lot more expensive.