A New Low

Given some of the ridiculous bullshit I've encountered in my house search, I might have to come out of blogging retirement.

ASKING PRICE: $469,900
ADDRESS: 14 5TH Pl, Long Beach, CA 90802
BEDS: 2
BATHS: 2
SQ. FT.: 1,214
$/SQ. FT.: $387
YEAR BUILT: 1953
MLS#: P786112
ON REDFIN: 86 days
HOA: $260
DOWN PAYMENT (20%): $94,000
INCOME REQUIREMENT (3.5 x Income): $107,000
MONTHLY NUT: $2,500
DESCRIPTION: Amazing sweeping ocean views from the main living space of this two bedroom, two bath condo. This secure unit is just steps from the sand and a large communal patio area, perfect for entertaining or watching the 4th of July fireworks. Condo features hardwood floors, updated kitchen, upgraded bathrooms and plantation style shutters. This could be your perfect ocean home.

I looked at this bank-owned condo a few months back and walked away unimpressed. Between the termite damage, filth, poor condition of the kitchen cabinets, darkness of the bathrooms, lack of street parking, community laundry, creaky floors and incredibly wonky layout, I quickly determined there was no way I was plunking down nearly half a million clams for this place.

Apparently I wasn't the only one.

Because after nearly 90 days on market and two price cuts, this thing is still rotting on the MLS. However, while checking out the listing photos I noticed the bank had finally staged the place to make it look more appealing to buyers. My first thought was, Maybe they're finally getting serious about selling!

Hey, not too shabby!

But then I took a closer look:

Something's off about the lines of the sofa and coffee table in relation to the walls...and the light sources aren't matching up with the rest of the -- wait, what the??

That's right, friends: PHOTOSHOPPED FURNITURE.

I mean, if it wasn't so pathetic it'd be hilarious.

Here is the real photo, with the "enhanced" one right below it for comparison:

Man, I have so many questions!

First, how long did it take to draw those shadows from the bar stools? That is some painstaking detail work. Second, where did the furniture and decorations come from? Another listing? A Crate & Barrel ad? Third, did the bank actually pay an outside firm for this cut-and-paste bullshit, or does an in-house Loss Mitigation employee just happen to have a passion for it?

I mean, why waste time with all this silliness? If you really want to sell, just lower the fucking price.

I'm sure the listing agent would say, "It's to show the potential of the space." And I would retort, "This has the potential to make you look like a low-rent, gold-bricking idiot."

The bank, which has already lost at least $200,000, is thinking the killer view will stop the bleeding. But that awesome white-water view is not nearly enough to overcome the dilapidated condition and layout disadvantages of this property.

But hey, instead of investing a few grand into actually repainting, cleaning, and staging the property, why not just waste time, money and effort digitally inserting fake paint, artwork and furniture into a listing photo? TOTALLY MAKES SENSE.

And hell, why stop at just one photo? Might as well go all the way. Here, I'll even supply a few freebies...

This original listing photo makes the bathroom look dark, dank and unwelcoming (um, because it is dark, dank and unwelcoming):

But the new version adds a much needed dose of mold-killing sunlight:

And yuck, look at those beater cars and stinky Port-o-Potty in this photo:

A little digital magic and we've really classed up the neighborhood!

I mean, is this where sellers are now in their quest to deny reality? Do they actually think this is going to have a positive effect on how people perceive a property?

I remember when the housing bubble first popped and people were giving away the brand-new Toyota Highlander in the driveway if you bought their overpriced McMansion. NOBODY FUCKING CARES ABOUT SOME SHITBOX YOU JUST BOUGHT WITH YOUR HELOC -- JUST LOWER THE GODDAMN PRICE!

For the record, if in real life this condo actually resembled the fraudulently altered listing photo, $387 per square foot, given the proximity to the sand, might be approaching a decent deal. But as it stands, I think this place requires entirely too much work to command such a premium price.

But hey, instead of putting in a little work to recoup more money at sales time, I fully support banks and listing agents lazily sprucing up listings with photo editing software. Sure, buyers are going to be bummed out that they were misled, but we will at least get a good laugh.

UPDATE: AN EAGLE-EYED READER SPOTTED THE SAME PHOTOSHOPPED FURNITURE IN ANOTHER LISTING. AMAZING CATCH, ANON!

Please please please let this trend catch on.

Irvine Prices in Long Beach: FINAL UPDATE

6/14/11 - Sold $305,000

After years of bullshit wishing prices, this turkey has finally been put out of its misery. In the last update, I said, "...$277 per square foot seems reasonable enough to nab a buyer." It ended up going for $281 per square.

Of note, the robo-appraisal was actually dead on!

$207,276

$300,400

$414,552

I don't take much joy in being right anymore -- I mean, who really cares? The delusional realtards have long since accepted the truth expressed on this blog and conceded defeat.

Plus, it doesn't take a whole lot of effort to make these accurate predictions. As I've said since the beginning, it's just a simple matter of what local incomes can support. This price is now generally in line with the median income, so it found a buyer -- not exactly a shocking development.

For the record, this sales price represents a $240,000 discount from the original batshit-crazy asking price. Delusional? Yeah, just a tad.

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


Here's an oldie but goodie.

In one of the maiden posts on this blog (don't forget the update), I featured this property, sporting a mind-boggling $545,000 wishing price. That 2008 post prompted a decent amount of hate mail (including this idiot whose soaked-diaper logic I eviscerated in a response. The result? We never heard from him again).

Although much has changed since 2008 (not the least of which is the disappearance of whack job bubble-deniers and wrong-headed realtors spitting their delusional venom on this blog) but what has not changed is my ability to ascertain "true values" based on the facts, the numbers, and good old fashioned common sense.

At the time I said:

At $454 per square foot and 260 days on market, this thing isn't going anywhere. Sometimes I get the feeling owners just aren't serious about selling. I don't care how close you are to Belmont Heights, in this zip code the median household income is $30,353. This house is probably slightly above median considering the minor updates, but even if the median income were $50,000 a year, this thing wouldn't be priced more than $250,000.

Well, now it's back on the market as a short sale, priced at $299,000.

Although it remains to be seen whether it will actually drop to $250,000 (honestly, I doubt it. First, when I made that comment very few could foresee the insane amount of taxpayer cash the government would throw at the housing crisis to keep prices inflated. Second, although it's a short sale -- which as we all know means it isn't really for sale by any heretofore relied-upon measure -- $277 per square foot seems reasonable enough to nab a buyer), my craaaaaazy comment two years ago(!), which seemed so controversial at the time, ultimately wasn't that far off.

On the other hand, how did this rambling, incoherent prediction from "HagenindaGHETTO" work out?

Keep the OC folks in OC! Besides, there is more to do here, it's more fun and you don't have to DRIVE everywhere! We deserve to be more expensive! (unless they are buying all cash... then they come first...LOL)

FYI: This home was not a FIXER FLIPPER, the sellers fixed it for themselves but got transferred to Irvine (now that's ironic is it not?). By the way, I know the sellers, they HATE Irvine (even though they are Conservatives) they miss our GHETTO and the fun, and the walking, and the beach and the marina.....

The listing agent will be thankful the stuffed shirt Self Righteous writer of of this BLOG for a PRICE DROP....it always attracts more potential buyers.

As for the Price:
Half the price...??? Good thing you're an accountant. Just run the comps and talk about the FACTS...
The last thing we need are mendacious comments that give a skewed picture of realty. Dig?

Well, dummy, I ran the comps and I talked about the FACTS and it looks like you were, are, and always will be

DEAD.

ASS.

WRONG.

(How does that feel? Be honest.)

P.S. I can't help but thinking how pathetic it is that these fucking idiots waited so long to get real and price to reality and not fantasy. If they hadn't been so ignorantly focused on getting their greasy mitts on their "well-deserved" bubble profits, they might have had a shot at walking away with actual profits. Oh well.

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

One of my first blog posts featured a stunning, if controversial, example of Avarice is Bliss.


This house exemplified the entire premise of this blog: Long Beach, while a great city in its own right, pales in comparison to Orange County regarding schools, low crime rates, incomes, and cleanliness, and therefore cannot possibly justify asking prices that match (and in some cases exceed) the premium levied in OC.

However, Kool-Aid knows no bounds and Long Beach sellers (particularly those in less desirable areas of Long Beach) got drunk on Equity Juice and priced homes in less desirable neighborhoods like they would in Irvine, Huntington Beach, or much nicer cities in LA County.

By putting their greed on display, they held themselves out for ridicule and humiliation. Hence, the impetus and inspiration of this blog.

So, here we are today, more than a year after the home was first listed on the MLS at a laughable $454 per square foot. Like many others, the seller gave up and the property has since been taken off the market ("MY HOUSE IS SPECIAL, DAMN IT! IF THESE BUYERS ARE TOO STUPID TO REALIZE THAT, THEN I WILL JUST TAKE IT OFF THE MARKET. I REFUSE TO BE INSULTED!") and now they are attempting to rent it.

ADDRESS: 1533 E. BROADWAY AVE. (BROADWAY/CHERRY)BEAUTIFUL, LUXURY 2BED/2BATH HOUSE FOR RENT! Immaculate Hardwood Floors throughout House. Skylight in Large Living Room. Fireplace located in Living Room. Luxurious Kitchen with Stainless Steel Appliances. 2 Full Bedrooms with AIR CONDITIONING! Large Attic for Storage. Stacked Washer/Dryer. Wiring available for Direct TV and Surround Sound System! Charming, Large Backyard with Firepit and Entertainment Area. Great Location!!1 YEAR LEASEGardener ProvidedNo PetsTenant Pays ALL UTILTIES EXCEPT WATERMUST SEE!!!!

You are welcome to come into our office and pickup keys to view this unit M-F between 9am-4pm. WE ARE NOT OPEN OVER THE WEEKEND. Please feel free to contact me via email or at the office for further questions.

Actually, they've been attempting to rent it for more than a year, offering a "LEASE or LEASE TO OWN!" scheme--ERR, agreement from the get-go. No bites.

But, I thought "this is a NEW HOUSE." Well, if anything from 1918 could be considered new, I guess they're on to something. By the way, I can give you a sweet deal on a "NEW" Nash 681.

They seem a bit thick-headed, no? They refused to lower their asking price to a reasonable figure and the property didn't move. They refused to ask a reasonable rent and it's still vacant after a year.

I'm going to let this seller in on the most closely-guarded secret known to man. This wisdom is guaranteed to save the housing market in one fell swoop, but it has been elusive to all but those who travel in the darkest, most remote corners of the universe. But now I will unleash it upon the world for all to see, so that our housing market and the current misery and financial hell may end once and for all. And here it is:

Lower the price, dick.

You may have read there has been an uptick in sales recently. There is no complicated, macro economics-heavy explanation for this other than prices are cliff-diving. And when people can afford homes without bullshit, negative-amortizing, interest-only, Harry Houdini loans, homes start selling. Real simple, folks.

And if this seller had accepted this truism from the outset, he could have saved himself a year's worth of carrying costs, which at the time I estimated at $3,500 per month ($42,000 in a year!), and a lot of stress. Assuming this termite tent could get $2,000 per month in rent (which, judging by the time it's been sitting unoccupied, is yet another case of this individual's greed-faced lunacy), they are still bleeding cash to the tune of $1,500 per month! OUCH!



Incidentally, the Irvine property I compared this house sold for $540,000 in March. That was only $9,000 off the original asking price. Yikes, for a corner location? How much "equity" do you suppose that buyer has lost since his purchase?

The point is, Irvine can clearly get away with those prices, but our Long Beach seller learned after a year on the market that Alamitos Beach ain't Irvine.

If you'll recall in the original post, a local realtor and an offended resident posted invective comments with absolutely no analysis or data to support their misguided, rose-colored assessment of Long Beach real estate. They instead offered personal attacks and meaningless insults, but couldn't refute my opinion that:

"At $454 per square foot and 260 days on market, this thing isn't going anywhere. Sometimes I get the feeling owners just aren't serious about selling. I don't care how close you are to Belmont Heights, in this zip code the median household income is $30,353. This house is probably slightly above median considering the minor updates, but even if the median income were $50,000 a year, this thing wouldn't be priced more than $250,000."

I mean, it doesn't take Dionne Warwick and her psychic friends to call that one.

The fact is that homes are still overpriced and prices have a way to go before they meet market fundamentals (I'm not talking about the much-vaunted "bottom," I'm just talking about when a home purchase is a sound investment) and as long as banks have a large inventory of REO properties and that tidal wave of Option ARM resets is looming just off the coast, buying a property today is nothing more than a backstage pass to the Financial Agony show at the Wiltern (I heard Slayer is opening).

Irvine Prices in Long Beach: UPDATE II

Here's an oldie but goodie.

In one of the maiden posts on this blog (don't forget the update), I featured this property, sporting a mind-boggling $545,000 wishing price. That 2008 post prompted a decent amount of hate mail (including this idiot whose soaked-diaper logic I eviscerated in a response. The result? We never heard from him again).

Although much has changed since 2008 (not the least of which is the disappearance of whack job bubble-deniers and wrong-headed realtors spitting their delusional venom on this blog) but what has not changed is my ability to ascertain "true values" based on the facts, the numbers, and good old fashioned common sense.

At the time I said:

At $454 per square foot and 260 days on market, this thing isn't going anywhere. Sometimes I get the feeling owners just aren't serious about selling. I don't care how close you are to Belmont Heights, in this zip code the median household income is $30,353. This house is probably slightly above median considering the minor updates, but even if the median income were $50,000 a year, this thing wouldn't be priced more than $250,000.

Well, now it's back on the market as a short sale, priced at $299,000.

Although it remains to be seen whether it will actually drop to $250,000 (honestly, I doubt it. First, when I made that comment very few could foresee the insane amount of taxpayer cash the government would throw at the housing crisis to keep prices inflated. Second, although it's a short sale -- which as we all know means it isn't really for sale by any heretofore relied-upon measure -- $277 per square foot seems reasonable enough to nab a buyer), my craaaaaazy comment two years ago(!), which seemed so controversial at the time, ultimately wasn't that far off.

On the other hand, how did this rambling, incoherent prediction from "HagenindaGHETTO" work out?

Keep the OC folks in OC! Besides, there is more to do here, it's more fun and you don't have to DRIVE everywhere! We deserve to be more expensive! (unless they are buying all cash... then they come first...LOL)

FYI: This home was not a FIXER FLIPPER, the sellers fixed it for themselves but got transferred to Irvine (now that's ironic is it not?). By the way, I know the sellers, they HATE Irvine (even though they are Conservatives) they miss our GHETTO and the fun, and the walking, and the beach and the marina.....

The listing agent will be thankful the stuffed shirt Self Righteous writer of of this BLOG for a PRICE DROP....it always attracts more potential buyers.

As for the Price:
Half the price...??? Good thing you're an accountant. Just run the comps and talk about the FACTS...
The last thing we need are mendacious comments that give a skewed picture of realty. Dig?

Well, dummy, I ran the comps and I talked about the FACTS and it looks like you were, are, and always will be

DEAD.

ASS.

WRONG.

(How does that feel? Be honest.)

P.S. I can't help but thinking how pathetic it is that these fucking idiots waited so long to get real and price to reality and not fantasy. If they hadn't been so ignorantly focused on getting their greasy mitts on their "well-deserved" bubble profits, they might have had a shot at walking away with actual profits. Oh well.

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

One of my first blog posts featured a stunning, if controversial, example of Avarice is Bliss.


This house exemplified the entire premise of this blog: Long Beach, while a great city in its own right, pales in comparison to Orange County regarding schools, low crime rates, incomes, and cleanliness, and therefore cannot possibly justify asking prices that match (and in some cases exceed) the premium levied in OC.

However, Kool-Aid knows no bounds and Long Beach sellers (particularly those in less desirable areas of Long Beach) got drunk on Equity Juice and priced homes in less desirable neighborhoods like they would in Irvine, Huntington Beach, or much nicer cities in LA County.

By putting their greed on display, they held themselves out for ridicule and humiliation. Hence, the impetus and inspiration of this blog.

So, here we are today, more than a year after the home was first listed on the MLS at a laughable $454 per square foot. Like many others, the seller gave up and the property has since been taken off the market ("MY HOUSE IS SPECIAL, DAMN IT! IF THESE BUYERS ARE TOO STUPID TO REALIZE THAT, THEN I WILL JUST TAKE IT OFF THE MARKET. I REFUSE TO BE INSULTED!") and now they are attempting to rent it.

ADDRESS: 1533 E. BROADWAY AVE. (BROADWAY/CHERRY)BEAUTIFUL, LUXURY 2BED/2BATH HOUSE FOR RENT! Immaculate Hardwood Floors throughout House. Skylight in Large Living Room. Fireplace located in Living Room. Luxurious Kitchen with Stainless Steel Appliances. 2 Full Bedrooms with AIR CONDITIONING! Large Attic for Storage. Stacked Washer/Dryer. Wiring available for Direct TV and Surround Sound System! Charming, Large Backyard with Firepit and Entertainment Area. Great Location!!1 YEAR LEASEGardener ProvidedNo PetsTenant Pays ALL UTILTIES EXCEPT WATERMUST SEE!!!!

You are welcome to come into our office and pickup keys to view this unit M-F between 9am-4pm. WE ARE NOT OPEN OVER THE WEEKEND. Please feel free to contact me via email or at the office for further questions.

Actually, they've been attempting to rent it for more than a year, offering a "LEASE or LEASE TO OWN!" scheme--ERR, agreement from the get-go. No bites.

But, I thought "this is a NEW HOUSE." Well, if anything from 1918 could be considered new, I guess they're on to something. By the way, I can give you a sweet deal on a "NEW" Nash 681.

They seem a bit thick-headed, no? They refused to lower their asking price to a reasonable figure and the property didn't move. They refused to ask a reasonable rent and it's still vacant after a year.

I'm going to let this seller in on the most closely-guarded secret known to man. This wisdom is guaranteed to save the housing market in one fell swoop, but it has been elusive to all but those who travel in the darkest, most remote corners of the universe. But now I will unleash it upon the world for all to see, so that our housing market and the current misery and financial hell may end once and for all. And here it is:

Lower the price, dick.

You may have read there has been an uptick in sales recently. There is no complicated, macro economics-heavy explanation for this other than prices are cliff-diving. And when people can afford homes without bullshit, negative-amortizing, interest-only, Harry Houdini loans, homes start selling. Real simple, folks.

And if this seller had accepted this truism from the outset, he could have saved himself a year's worth of carrying costs, which at the time I estimated at $3,500 per month ($42,000 in a year!), and a lot of stress. Assuming this termite tent could get $2,000 per month in rent (which, judging by the time it's been sitting unoccupied, is yet another case of this individual's greed-faced lunacy), they are still bleeding cash to the tune of $1,500 per month! OUCH!



Incidentally, the Irvine property I compared this house sold for $540,000 in March. That was only $9,000 off the original asking price. Yikes, for a corner location? How much "equity" do you suppose that buyer has lost since his purchase?

The point is, Irvine can clearly get away with those prices, but our Long Beach seller learned after a year on the market that Alamitos Beach ain't Irvine.

If you'll recall in the original post, a local realtor and an offended resident posted invective comments with absolutely no analysis or data to support their misguided, rose-colored assessment of Long Beach real estate. They instead offered personal attacks and meaningless insults, but couldn't refute my opinion that:

"At $454 per square foot and 260 days on market, this thing isn't going anywhere. Sometimes I get the feeling owners just aren't serious about selling. I don't care how close you are to Belmont Heights, in this zip code the median household income is $30,353. This house is probably slightly above median considering the minor updates, but even if the median income were $50,000 a year, this thing wouldn't be priced more than $250,000."

I mean, it doesn't take Dionne Warwick and her psychic friends to call that one.

The fact is that homes are still overpriced and prices have a way to go before they meet market fundamentals (I'm not talking about the much-vaunted "bottom," I'm just talking about when a home purchase is a sound investment) and as long as banks have a large inventory of REO properties and that tidal wave of Option ARM resets is looming just off the coast, buying a property today is nothing more than a backstage pass to the Financial Agony show at the Wiltern (I heard Slayer is opening).

Inventory Update

That's down 3% just between September and October! Wow.

And the result?

A greed-driven divergence between List vs. Sold price per square foot.

That's what happens when all but the dumbest, most delusional sellers take their ball and go home and wait for the market to "return to normal." Current sellers know there's no quality inventory out there and it makes them cocky and emboldened.

As we enter the winter months we'll see if that approach pays off.

Well, It Was Worth a Shot: UPDATE II

The price was "$279,000" and changed to "$269,000"

I've been seeing $10,000 price reductions ALL OVER THE PLACE since the Federal tax-credit expired, and all it really tells us is that the free government ponies make housing that much more expensive.

I'll remind you, this flopped flip first arrived on the market in March with a wishing price of $339,000. And since then he's been gingerly chasing the market down, perpetually 10 steps behind the curve. Thus far his lackadaisical pricing strategy has resulted in being forced to cut 60 Grand from the original ask -- all to no avail.

And now that the tax credits are history, you have to wonder how much more cold, hard cash his ridiculous strategy will cost him.

Factoring in commissions, he is looking at a profit of $28,000 for this exercise in futility. A pittance compared to what he could have walked away with, but at least it's not a loss, right?

Oh, but we forgot to factor in the ~$10,000 spent sprucing it up and the last eight months of carrying costs. If this fliptard doesn't get real -- and real soon -- it's gonna get real ugly.

The end of The Super Summer Selling Season(tm) is coming up quicker than you think, pal...

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

On March 30th I said, "Hey, Flippy, Price Reduction's on line #2. Says it's urgent."

Well, the capitulation has begun in earnest:

May 10, 2010 - Price Changed $309,000
Apr 28, 2010 - Price Changed $319,000
Apr 12, 2010 - Price Changed $325,000
Mar 27, 2010 - Listed $339,000

Those dreams of stacking flipper cash are quickly disappearing like a parakeet fart in Tornado Alley.

And check out this updated description:

Agents Owner Financing available with 20% down 8% rate for 30 or 40 years due in 5. Easy qualifying on credit and income. No appraisal needed or tax returns fast approval no hassles or time delays. Corner-front Condo unit with city views and cool ocean breeze. Two bedroom and two baths newly remodeled. Convenient location close to beach, parks, public transportation, Belmont Shores [SIC] and Shoreline Village. On site laundry facility with 1 car underground parking. Granite, new appliances, carpet and building security with plenty of storage space in unit. Private balcony off of living room. No pets allowed unless buyer has doctor instructions for medical reasons.

First of all, can someone translate those first two sentences for me? You can get financing through the flipper's agent? And despite 20% down you still have to pay an 8% interest rate? And the principal is due in five years? The way it's worded is a complete mess.

And the whole "No appraisal needed or tax returns fast approval" thing makes it sound shady as hell. The only people who care about that stuff are deadbeats with suspicious money issues. And the fact that this flipper is catering to those types makes you wonder about this neighborhood.

And who the fuck wants to buy a place in a declining market WITH NO APPRAISAL?!

That last line is a head-scratcher too. What "medical reason," other than blindness, could someone have that would require them to have a pet? And what about the fellow residents who may have medical reasons to NOT want pets around? So weird.

Whatever. This flipper is in deep shit if he doesn't get his act together soon. I can't wait to see how much he slashes the price next month! Stay tuned.

P.S. If you were stupid enough to buy in March, you would already be $30,000 underwater on your purchase. Good thing you read this blog!

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

Not sure if you remember this dump from October 2009, but it turns out just a month after my post a flipper swooped it up from the bank for $225,000 (the lender ate a $200,000 loss on that one).

As crusty as it was, $225,000 was a pretty good deal (in October I said I thought $250,000 penciled out). And like most sales so close to downtown, it represents a 2002 price.

Anyhow, this flipper, instead of taking a shitty property, sprucing it up, and extracting a reasonable profit, has turned out to be just another gluttonous pig with his greedy, money-grubbing snout buried deep in the quick-money trough.

After slapping on some paint, pergo floors, and cheap carpeting, he dumped it on the market with a $114,000 built-in profit.

$114,000!

What a jackass.

Let's see...community laundry, only one parking spot, and located all the way the hell down on Esperanza? For $339,000?!

The average price per square foot in this neighborhood is $274 and he's asking $355?

What the fuck for? Fake wood floors and repainted cabinets (oh, you didn't think we'd notice that)?



And he might have just painted over the pink tiles!

Other than money spots on Ocean, nearby properties don't even come close to asking this kind of money. What a dolt.

Look, I'm cool with flippers improving rough properties (and, in some cases, improving the neighborhood as a result) and making a little dough. Hell, in this environment you gotta have a set of dangling bowling balls to try your hand at flipping, and you should be rewarded for the risk you're taking. As far as I'm concerned, party on Wayne.

But what I can't get over is the utter contempt some of these flippers have for potential buyers. I mean, he truly believes you and I are complete rubes and that he deserves $100,000+ for doing little more than putting lipstick on a warthog.

Hey, Flippy, Price Reduction's on line #2. Says it's urgent.

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

I'm back from Chicago, and let me tell you, there aren't many better cities to celebrate your birthday. And speaking of cities with a condo problem:

1329 E 1st St #18, 90802
Price: $250,000
Beds: 2
Baths: 2
Sq. Ft.: 954
$/Sq. Ft.: $262
Year Built: 1959
MLS#: T09106531
On Redfin: 5 days
HOA: $150
Down Payment: $50,000
Income Requirement: $71,000
Monthly Nut: $1,500
Description: 2 bedroom, 2 bathroom front, corner unit condo in the Startdust Condo Building with city lights view from private balcony and master bedroom and view of the ocean from the rooftop deck. Located in gated community with underground parking and only 1 block from the beach. Unit has a lot of closet and storage space. Conveniet location. Close to park, shopping, public transportation, downtown Long Beach, Belmont Shore, Shoreline Village and the Pike Center.

"Conveniet"?

It appears the bank took this puppy back in February of 2008 for $375,000. The play seemed to be, "Bubble pricing will be back in no time...let's just wait this out. It can't possibly go any lower!"

Well, they successfully kept it off the market for ONE AND A HALF YEARS (Anybody still believe shadow inventory doesn't exist? Really?) before throwing it on the MLS for--take a wild guess!--$375,000.

I guess it was worth a shot, eh?

Because yesterday (just four days after relisting at that hilarious wishing price) the price was dropped a mind-blowing -$125,000. Ploy to garner a bidding war? Typo? Or the result of actually looking at comps and accepting reality?

Who knows, but that is one hell of a price cut. Check this out this history:

Oct 06, 2009 - Price Changed $250,000
Oct 02, 2009 - Listed $375,000
Feb 22, 2008 - Sold $375,000
Nov 04, 2007 - Delisted
Sep 30, 2007 - Listed
Mar 09, 2006 - Sold $418,000
Sep 27, 2002 - Sold $227,500
May 08, 1990 - Sold $132,500
Apr 19, 1989 - Sold $120,000

Yep, this is a 2002 price! And it's still no guarantee of selling in this market. Because regardless of that aggressive pricing, there is no escaping how dumptastic this place is:



Good grief, Charlie Brown, what a crap shack.

BUT, it's approaching rental parity, so this might be a decent buy.

Think about it: Get an FHA loan, use the (coming) $15,000 homebuyer tax credit for your down payment, and when you fall deep underwater, stop paying and live rent-free for a while, and just walk away with a wad of saved cash and a dinged credit score when they finally kick you out. If anybody gives you static about your FICO, just tell them, "Hey man, it was 2010."

Believe me, everyone will understand.

The Tax Credits End, Let The Anxiety Begin

1901 East OCEAN Blvd #205, Long Beach, CA 90802
Asking Price: $705,000
Peak Purchase Price: $725,000
Beds: 2
Baths: 2.5
Sq. Ft.: 1,883
$/Sq. Ft.: $374
Community: Downtown Area/Alamitos Beach
MLS#: P734338
Source: CARETS
On Redfin: 35 days
HOA Fine: $444
20% Down Payment: $141,000 (20%)/$28,200 (FHA)
Income Requirement: $161,000 (Mortgage/3.5X)
Monthly Nut: $4,200 (conventional)/$4,900 (FHA)
Description: Here is your opportunity to own in the exclusive Park Regency complex along Ocean Blvd. This stunning complex is a real gem with an incredible courtyard and exterior finshes and details!This premiere 2bed+Den corner location affords stunning ocean and park views and is the largest floor plan in the complex!The interior of the home offers beautiful slate floors, custom crown molding, open and functional kitchen, newer appliances, custom window shutters throughout, full home theater, fireplace in the living room and more!This open floor plan is full of natural light and is sure to impress along with offering a oversized master suite with sitting area, large living room and formal dining room!Complex offers a clubhouse, spa and is secured along with closed circuit TV surveillance as well!2 side by side underground parking spaces and additional storage!

"Finshes"?

This dummy bought promptly at the peak of the bubble and has somehow convinced himself there was no crash.

Nope, never happened. Didn't take place. Just something the librul media made up. Everything's just hunky dory, and I can get out of this for pretty much break even. Yep, annnnnnnnnnny minute now...

So, this delusion-deluged soul is asking $705,000, a paltry $20,000 discount from his purchase price three years ago. Never mind the last three years have seen the most devastating housing crash in the history of the USA, where $Trillions in net worth and home equity evaporated -- but not for this guy, no way. You see, he's special.

And by the way, his asking price is just under FHA limits so technically you could get a(n essentially) no-money-down FHA loan and avoid putting substantial skin in the game. Of course, your payment would shoot from $4,200 a month to $4,900, but at least you'd have the option of moonwalking away when the value of your apartment inevitably drops and you find yourself perilously upside-down.

In the context of a free pass to walk if the going gets tough, it's difficult to argue paying a higher monthly nut isn't worth it.

If you look at the sale history, the 1997 buyer (who bought just after the trough of the last housing crash) made a nice chunk of chance during his nine-and-a-half years of ownership:

May 10, 2010 - Listed $705,000
Mar 21, 2007 - Sold $725,000 (+11.8%/yr)
Oct 24, 1997 - Sold $255,000 (+9.3%/yr)
Jul 28, 1995 - Sold $209,000

A nice, solid 12% appreciation per annum. Well played, sir.

Unfortunately for our seller he failed to see that paying nearly half-a-million bucks more than the previous owner was a big red flag of a speculative, unsustainable bubble. Unless this apartment suddenly doubled in size and was transported to the beach side of Ocean Blvd., there is no economic justification for four walls and a roof appreciating an average of $50,000 per year.


So what you're seeing here is a seller desperately clinging to the misguided notion that he didn't overpay and deserves peak pricing for his "wise" investment.

The good news for our embattled seller is a sold comp appears to justify his asking price: Unit #203, also with an ocean view, sold in May for $695,000. Going by that comp, he and his agent (the same agent who sold Unit #203, by the way) aren't that far off.

Or are they?

Because there appear to be some subtle differences between the units. For example, the kitchens.

You can get with this (Unit #203):

Or you can get with that (#205):

I think you'll get with this, 'cuz this is where it's at.

But they're both pretty nice inside, so let's just assume they're apples-to-apples.

In that case, why is our featured unit still on the market?

Maybe because that May buyer was a complete fool and the vast majority of buyers have noticed how much cheaper it is to rent luxury condos on Ocean Blvd? After all, this loaded condo with an ocean view is only asking $2,683 (a precise asking rent typically indicates an investor trying to cover his monthly nut) -- a massive $2,100 monthly savings!

And you get to live here:


Nice!

Please, someone explain to me how purchasing 1901 Ocean, given the anxiety a new owner would suffer over the likelihood of further price declines, is worth that kind of premium over renting that luxury unit.

Maybe it hasn't sold because of the cheaper competition in the building? This unit (again, listed by the same realtor) is asking $599,000.

Now, to be fair it does not have an ocean view. But is an ocean view really worth an extra $106,000? Frankly, I think so, but in order to truly answer that question you first have to determine whether a non-ocean view is worth $599,000 in the first place. Given the 43 days on market with no interest, I'd say no.

Or maybe it hasn't sold because in the absence of the expired Federal tax credit and the soon-to-be-expired State credit, $705,000 just seems too rich for buyers' blood?

I think this is the most likely scenario. The expiration of the tax credits makes this a whole new ballgame. In my opinion much of the demand has already been pulled forward and we're finally about to see what the housing market really looks like without a bulk of the artificial support (other than FHA loans and record-low rates).

If sales drop like I think they will during the next few months, another tax credit is pretty much ensured. And maybe it'll be $12,000 this time. Or why not $15,000? With Obama asking for $50 Billion in state-aid (I love how the WaPo characterized it as "pleading" for money. And wait, why more funds? I thought that's what the stimulus was for) and Freddie Mac/Fannie Mae requiring up to a $Trillion taxpayer dollars (yes, with a T) to keep the lights on, at this point it's just Monopoly money anyway.

The government has shown it will stop at nothing to prop up housing, and after dumping truckloads of cash into these reflation efforts, I don't expect it to suddenly change course any time soon.

Who's excited for the next round of free ponies?

Made in the Shade: UPDATE II

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

Gee, that only took seven months.

Poor guy. He really thought he would more than triple his initial 2002 investment. And now, after 552 days on market, it looks like he won't even double it.

I'll try to hold back my tears.

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

The list price was "$995,000" and changed to "$875,000"

Wow! Quite a price reduction!

But before you get too excited and start thinking he suddenly found religion and will start pricing aggressively, it took him four long months to make this much-needed cut. In the grand scheme of things this reduction doesn't mean anything. All it means is the property was $120,000 overpriced.

This jackass is less than a month away from his one-year anniversary on the MLS. That's a scarlet letter ("S" as in "Stale") any seller should fear. You think he'll wake up in time to beat the clock?

Considering it took 340 days to get to a somewhat realistic price, I'm going to go out on a limb and say...

Happy Anniversary, Numbnuts.

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


16 12Th Pl, 90802
Price: $995,000
Beds: 2
Baths: 3
Sq. Ft.: 2,056
$/Sq. Ft.: $484
Lot Size: 2,915 Sq. Ft. (yikes!)
Year Built: 1904
MLS#: P666834
On Redfin: 254 days
Down Payment: $200,000
Monthly Payment: $6,100 (@ 6.5% jumbo)
Income Requirement: $285,000
Description: $200,000. PRICE ADJUSTMENT!!! This one of a kind Alamitos Beach Bluff home has the location and views you've been wanting! It has an updated kitchen and breakfast bar with top-o-line Starmark European maple cabinets,bamboo flooring,recessed lites and S/S appliances.The large formal dining room and open living room lead to the patio overlooking the beach for your morning coffee or brunch. The large family room with recessed lites and crown moulding leads to your own private rear yard with new hardscape and landscape.The inside laundry room with premium washer, dryer and sink off the kitchen also has a upgraded 1/2 bath. The upper level off the foyer has two large master suites with walk in closets,berber carpet, ocean views, top-o-line Hans Grohe fixtures in the upgraded baths and a sun porch. This home has too many upgrades to mention.... a must see for your fussy clients! CLICK ON MEDIA 21 OR MAIN PICTURE TO ACCESS VIRTUAL TOUR AND PICS.

Boy, for a house "at the water's edge," you would think the realtor would be smart enough to include shots of that glorious ocean view.

Wanna know why she didn't? Because there isn't one.

Weren't you beginning to wonder why the exterior shots looked a bit, um, shady?

Well, it's because this house, with only two bedrooms on a cramped lot, is completely surrounded by enormous apartment buildings and a parking structure. Engulfed might be a better word to describe how deep in the shadows this house is.

Do yourself a favor and click on the Redfin listing and check out the Aerial View. DOH!

And is it just me, or does it seem like every "Cape Cod" homeowner has a graduate degree in Application of Clutter as Home Decoration?

To give you an idea of just how greedy and delusional this seller is, the original listing price in December 2008 was a laughable $1,400,000. After four months with no interest, they relisted in April 2009 (presumably with a different realtor who promised vastly more bubble profits) with an unbelievable $1,700,000 price tag.

HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!

Idiot.

They are obviously convinced the proximity to the water is worth big bucks. But I have news for them: With no actual view of the ocean, that's like Rachel Bilson being your girlfriend online.

Or living near the most scenic point of the Grand Canyon--in a windowless mansion.

Great in theory, but about as useless as braille on a Harley Davidson owner's manual.

So, the current asking price of $995,000 represents a $705,000 fall from grace--ERRR, wake up call--ERRR, reality check--ERRR, discount from the highest asking price.

Jul 17, 2009 - Price Changed $995,000
Apr 07, 2009 - Price Changed $1,200,000
Apr 07, 2009 - Relisted ($1,700,000)
Dec 18, 2008 - Delisted
Dec 02, 2008 - Listed $1,400,000
Sep 06, 2002 - Sold $459,000
Oct 20, 1998 - Sold $300,000
Nov 22, 1996 - Sold $255,000

Dang, can you believe this place sold for $255,000 during the last housing downturn? Sheesh.

The crazy thing is, the 2002 purchase price of $459,000 means if this seller just priced realistically, he would walk away with a pallet full of cold, hard cash. Assuming he didn't HELOC himself into the stratosphere, that is.

But given the costs associated with "too many upgrades to mention," all bets are off.

Dumbass of the Decade

2525 East OCEAN Blvd, Long Beach, CA 90803
Wishing Price: $2,799,999
Beds: 4
Baths: 4
Sq. Ft.: 4,100
$/Sq. Ft.: $683 (!)
Year Built: 1953
Community: Belmont Heights/Alamitos Heights
MLS#: P725816
On Redfin: 73 days
Down Payment: $700,000 (25%)
Income Requirement: $600,000 (mortgage/3.5x)/$800,000 (home price/3.5x)
Monthly Nut: $15,000 (HAHAHAHAHAHAHA!)
Description: One of a kind location. Mid Century designed by Shelly & Merchant. Located on Ocean in Bluff Park with Catalina and Ocean Views. Unobstructed and panoramic views of the Queen Mary down to Huntington Beach. Private interior courtyard, plus a game room with fire pit and electric fireplace. Game room opens to the back yard with room for a pool This is a great home for entertaining with most of the original charachter in place. There are 3 fireplaces; located in the living room, master bedroom and upstairs den. There is a bedroom and bath downstairs and a full laundry room/craft room/ breakfast room off the kitchen. Perfect space for in-laws, maid or nanny. Regular Sale, owner may carry with 25% down.

Want to see something amazing?

Mar 12, 2010 - Listed $2,799,999
Jan 08, 2009 - Delisted
Nov 22, 2008 - Price Changed
Oct 20, 2008 - Listed
Oct 13, 2007 - Delisted
Sep 27, 2007 - Price Changed
Jul 14, 2007 - Listed
Jun 14, 2007 - Delisted
Feb 01, 2007 - Delisted
Jan 12, 2007 - Listed
Aug 08, 2006 - Listed
Jun 29, 2006 - Delisted
Mar 20, 2006 - Listed
Mar 17, 2006 - Delisted
Oct 05, 2005 - Listed
Sep 21, 2005 - Delisted
Jun 20, 2005 - Listed
Jun 18, 2005 - Delisted
Apr 05, 2005 - Delisted
Apr 01, 2005 - Listed
Feb 07, 2005 - Listed
Feb 01, 2005 - Delisted
Nov 17, 2004 - Listed
Nov 10, 2004 - Delisted
Aug 13, 2004 - Listed
Aug 04, 2004 - Delisted
May 25, 2004 - Listed
Nov 02, 1999 - Sold $777,500

They have been trying to sell this joint, off and on, since 2004.

2004!

The sheer level of denial is fascinating.

"Well gee, Carol. I don't know what more we can do. We got designers from Disneyland's Haunted Mansion to stage it, took 11 whole pictures, and hired a realtor who hasn't quite mastered the English language...why hasn't it sold?"

"I don't know, Phil. Do you think maybe we're asking too much money?"

"Don't be a fucking idiot, Carol. $3 million for a place with this much 'charachter' is a goddamn steal!"

This has to be the dumbest son of a bitch I've ever featured on this blog. Just utterly stupid and delusional beyond comprehension.

A further look into the history and we see that Captain Nutjob here purchased in 1999 for a mere $777,500. $190 per square foot is a pretty damn good deal considering the location.

And now, a decade later, he's demanding a whopping TWO MILLION DOLLAR premium?! For that kind of appreciation you would expect some extensive renovations and improvements, right?



WRONG.

Is this a fucking joke?

How is this even a real listing? And how can the agent take herself seriously after standing behind her client's bullshit wishing price? Isn't she positively mortified talking to potential buyers?

She must dread the moment during every tour when buyers ask, "So, what's the most recent listing price?"

I imagine her gulping and having the same familiar internal dialogue to steel herself:

"Crap, here we go. Come on, keep a straight face. You can do this. Remember, they're not laughing at you. They're just not savvy. Yeah, it's them. Not you. You're great at what you do. You are. And after 2,000 days on the market, $2.8 million makes perfect sense. Sell it, girl! You can do this...well, you have to do this. You ate the last Top Ramen this morning."

This listing price of $2,799,999 has to be a mistake. It just has to be. If not, then someone needs to explain to me why this cobwebbed piece of shit is one of the most expensive listings in the entire city of Long Beach.

The funniest thing about this dilapidated dump is the listing mentions "room for a pool." For $2.8 million clams, there better be an Olympic pool staffed 24 hours a day by Rachel Bilson, Natalie Portman, and Marisa Miller...and their twins.

And, if you're a longtime reader I'm sure you noticed there are no photos of the kitchen or any of the four bathrooms. And as a longtime reader I'm sure you know what that means: The kitchen and bathrooms are complete disasters that need to be gutted immediately.

That's right: A 2.8 million dollar fixer-upper.

Any sane person, before dropping $2.8 mil on this vomitorium, would save themselves a cool mil and buy this bad boy:


But maybe those with $700,000 to put down and an eagerness to pay a $15,000 monthly nut would comparison shop and look at sold comps. And they might notice this amazing property that just sold in Naples for $2.9 million:


Our seller really believes his flea-infested stink bomb can compete with that house?

REALLY?!

Mike in LBC sent a link to a LBPOST article citing that ridiculous Trulia/RealtyTrac survey that claims "six in 10 people would not walk away from their mortgage no matter of how far underwater they are." In the comments I posited that without asking the respondents "Do you believe you are currently underwater?" the findings are utterly worthless.

The reason? BECAUSE MOST SELLERS -- INCLUDING THIS NUMBSKULL -- ARE COMPLETELY OUT TO LUNCH WHEN IT COMES TO PERCEPTIONS OF WHAT THEIR PROPERTIES ARE "WORTH."

How many properties have you seen featured on this blog where the debtowner is pricing as if the bubble never burst? Countless.

My point is if people aren't aware they are underwater (because they believe their properties are "special," are bubble deniers, or are just plain stupid) then asking them whether they'd walk away is completely, utterly moot.

It's tantamount to asking a 400-pound dude in the middle of gorging himself at Chronic Taco, "Hey pal, would you steal a loaf of bread if you were starving?"

"NOM NOM NOM. No way, dude. NOM NOM NOM."

Well of course not. Because he's not starving and can't picture a day when he would be in that position. But if he was suddenly out of money and had nothing to eat, you'd better believe he'd waddle out of Trader Joe's with some shoplifted rolls stashed in his fat rolls.

Anyhow, I can just picture this brain-damaged imbecile high-fiving himself every morning, congratulating himself on hitting the lottery.

"I'm going to be rich! Any day now a buyer will come by and I'll be rewarded for buying before the bubble. Damn, I'm smart. And special too. Man, I can't wait to collect on my well-deserved bubble riches!"

And I can't wait for the day when he and his realtor realize just how incredibly stupid they've been about the value of this shitty, outdated house and realize just how much money they passed up by sticking to this misguided pricing strategy.

After six years of living in denial, I bet that's gonna hurt.