Enough to Make Your Vomit Vomit

I'm back from my worldly travels. I'm tired, sunburned, and most importantly, clear-headed.

Nicaragua, as I'm sure you're aware, is a very poor country. The people were incredibly nice and were laudably patient as I stumbled my way through poorly-conjugated verbs and an endless stream of "come se dice?"

When you see how Nicaraguans live, you gain instant perspective about our lives in America and just how ridiculously fortunate we are. I mean, deciding between granite and Corian counter tops is a legitimate, keep-your-ass-up-all-night concern back home.

"Damn it, Bryce, they're out of the maple cabinets! Now our stainless steel fridge won't look right! Why, God, whyyyyyyyyyyyy!"

Nicaraguans, on the other hand, are at their happiest when they have a glass of potable water.



For those of you who believe I'm too hard on used house salesmen, loose lenders, gold-bricking government "leaders" and materialistic greed-heads, you have to realize that to some of our fellow humans, the Great Housing Bubble and our unchecked materialism is a complete fucking joke. I criticize HELOC-abusing pricks who tried to live like millionaires, but to most Nicaraguans WE'RE ALL FREAKING MILLIONAIRES.

Believe me, this isn't some anti-materialist conversion. I haven't sold my car or my suits, and I haven't donated all of my down payment money to charity--I'm still a Southern California boy bitching about condos that don't feature in-unit laundry.

My point is that this site is all about perspective. I don't want anyone to get the idea that this blog is dedicated purely to laughing at the misfortunes of others. Well, it is dedicated purely to laughing at the misfortunes of others--but those that deserve the ridicule (either through reckless lending, taking on insane debt-loads, or acting like a holier-than-thou prick when I run into you at Schooner or Later and you brag endlessly about the "toys" selling used houses got you).

And before someone carts out the guy who got cancer and was "forced" to take out HELOCs to pay bills or the single mother who lost her job and could no longer keep up with her mortgage as examples of why we shouldn't have senses of humor, I'll remind you that they're not being taken out back and shot. They're just calling U-Haul and moving their shit to an apartment they can afford. And the life they're living in rental unit #38B is 80,000 times better than the lives being lived in the plantain fields of Nicaragua.

With that said, check out this disgusting shit pile!

Address: 3245 Santa Fe Ave #68, 90810
Asking Price: $49,900
Size: 2 beds, 1 bath, 730 sq. ft. (built in 1965)
$/Sq. Ft.: $68
HOA Fee: $215
MLS#: P664998
On Redfin: 79 days
Down Payment: $9,980
Monthly Payment: $500 @ 5.5%
Income Requirement: $15,000 @3.5X
Description: Affordable 2 bedroom Westside area condo. Located in a security complex with nice landscaping, this property is in need of a cosmetic upgrade. Priced to sell.

First of all, a $215 HOA fine? WTF for?

Second, at $68 per square foot, this is one of the least expensive properties in Long Beach. And there is a distinct reason why.

"In need of a cosmetic upgrade" is sure one way to describe the filth and horror about to befall us. I guess he just wasn't feeling honest enough to say the truth:

This dump is awful enough to make your vomit vomit.

Kids, get on your hazmat suits because we're going in!



Ugh. I can smell it from here. This place is truly, truly awful.

And, the agent included one of my favorite listing photo trends:



TURD CHECK!

And it's a toss-up for the Most Meaningless Listing Photo Award, so I'll let you decide:

Photo #1: Just in case we didn't believe them about the unit number.



Photo #2: Assuming you can afford a car, I guess it's nice to visualize where you'll be parking it?



Photo #3: Safety first?



And although the following picture may initially seem pointless, a security door in this neighborhood is more desirable than a rock pool in Newport Coast.



Hell, you might need two!

Anyhow, this borderline tenement housing is obviously only intended as an investment property. People who live in these conditions aren't concerned with "building equity" or climbing "The Property Ladder" (unless by "Property Ladder" you mean eventually living in a place that doesn't involve roaches shitting in your coffee mug)--they just want cheap rent.

The good news is that with a monthly nut of only $500 (40% of which is your HOA fee!), as an investor you would easily be cashflow positive on this one-step-up-from-a-cardboard-box apartment.

But it's clear that you'll have to dump $10,000 to $15,000 into it right away to keep the health inspectors away. Plus, I very seriously doubt you could get financed on this deal, so it's most likely going to be an all cash transaction.

I guess the question is, if there's still no action at this rock-bottom price...is there any price at which this place will move?

Sorry for the delay in new posts, but travel to the Carolinas, an infuriating computer meltdown, and a mini-vacation to Nicaragua have kept me away.

But I'll soon be back home refreshed, sunburned, and ready to indulge in some RE in the LBC action.

The Glass House

There's a scene in Die Hard when Hans Gruber, after noticing during his first encounter with John McClane that our erstwhile hero was barefoot, orders his henchmen to "Shoot zee glass." Hans knew if the bullets couldn't stop the gruff New York cop then the glass certainly couldn't, but he was fully aware that at the very least, it would make Officer McClane's life miserable should he manage to avoid being riddled with hot lead.

John makes it out alive, but as Hans calculatingly predicted, McClane's feet became so plugged with jagged shards of glass that he was unable to walk on his profusely bleeding feet. He drags himself into a Nakatomi Towers bathroom and, much to the audience's gut-wrenching horror, begins slowly pulling out huge chunks of glass as he winces from the incredible pain. Brutal.



I bring this up because pulling postage stamp-sized shards of glass out of your flesh reminds me of what it must be like trying to sell this house:



Jul 07, 2008 - Listed $3,875,000
Aug 27, 2008 - Price Changed $3,699,999
Sep 05, 2008 - Price Changed $3,499,999
Dec 10, 2008 - Price Changed $3,199,999
Dec 29, 2008 - Price Changed $3,100,000
Jan 06, 2009 - Price Changed $2,999,000
Jan 17, 2009 - Price Changed $999,000

Says Eddie of Long Beach (by the way, RE in the LBC readers are on fire lately with the good tips!):

Have you seen this?

http://www.redfin.com/CA/Long-Beach/2401-E-Ocean-Blvd-90803/home/16898902

My wife and I walk our dog by this place and we've watched it go from a construction site, to an open house with 2 signs out front, then an open house with 12! signs out front, to this, a major haircut.

Of course, its not likely to be approved as a short sale but talk about a desperate seller.

I too, used to drive, walk, and ride by this house frequently last summer and once the construction was finally finished, I was always tempted to pop into the open house to ascertain why nobody was interested. When I looked it up online, it didn't take me long to figure it out: A certifiably-WTF price of $3,700,000.



Well, after slowly, excruciatingly pulling out a shard of glass every few months, the pain became overwhelming and just this month the seller decided on amputation rather than the gradual bloodletting of the last five months.

Here's a quick look at the numbers:

Address: 2401 E Ocean Blvd, 90803
Asking Price: $999,000
Size: 6 beds, 6 baths, 5,000 sq. ft. (built in 2008)
$/Sq. Ft.: $200
MLS#: P670402
On Redfin: 197 days
Down Payment: $199,800
Monthly Payment: $5,400
Income Requirement: $285,000
Description: SUBJECT TO BANK APPROVAL - ALL BIDS DUE BY 2-22-09 - All Bidders will receive 'best and final counter'. Custom built home w/Guest House just finished in 2008, W/Certificate of Occupancy; Spectacular Ocean Views located in Belmont Shore across from the Long Beach Museum of Art. butlers pantry, formal dining room & formal living room w/Ocean Views, master suite w/private terrace & Ocean Views. Guest House too! Wrapping up the circular Turret is a dramatic long spiral staircase leading to the second level. Finest Marble & Brazilian Cherry Wood floors, spectacular foyer, Marble fireplace in the living room, Marble through out the Great Room, Spanish Terracotta back patio & front entrance, all open up to large oversized French doors, ELEVATOR & 4 CAR GARAGE. If this home is in your price range, you do not want to miss it! PS: VIKING STAINLESS APPLIANCES not in sale, buy frm SELLER. + extra Dishwasher Drawer, SUB ZERO Refrigerator.

What a disaster. This flipper probably thought he was pretty clever buying this ocean-front property at the peak and constructing a luxury villa. Blinded by dollar signs.



He tore down the existing house, used primo materials, included luxury touches like Viking appliances, a home theater, and a FREAKING ELEVATOR...and then got stuck on the wrong side of the worst housing implosion in the history of the world.

And as he runs for the door of this shattered glass house, the shards are pushed deeper and deeper into his sole.

And hence the Hail Mary asking price of $999,000. Now, whether that price is a ruse to create a bidding war (which is likely, and even more likely to work), it still reeks of panic and fear.

By the way, that "Ocean View" is partially obstructed by the Long Beach Museum of Art across the street. If you see the property in person you'll truly appreciate the masterful crop job on this photo:



Well, I wish them luck with the short sale. For no other reason than I will no longer have to look at those hideous realtor signs and Open House banners when I drive by.

And if the bank doesn't approve this price, just tell 'em: [NSFW video]

Arigato: UPDATE IV

I just got back from a fun night at Legends featuring lobster rolls, cold beers, and good company...what more could you ask for?

Well, I guess a Belmont Shore house walking distance from 2nd Street would be a good start.

Which reminds me, the perpetually awesome KatyinLBC updated us on the never ending saga of the Problematic Puke Palace on Park:

Just in case you are looking for a place to rent, you are in luck, they put this one on craigslist:

http://losangeles.craigslist.org/lgb/apa/999475600.html

And it's still on redfin. lol



Not only are they so delusional that they're still asking $2.25 Million after 523 days on market, but now they believe they can get $6750 per month in rent.

In this economy.

For this eyesore.

Hilarious!

The problem with sellers offering to lease their home while simultaneously trying to sell it is that they show all their cards. They just revealed to any potential buyer with access to a Texas Instruments calculator that purchasing this house, as opposed to renting it for the (supposed) going rate of $6,750, would cost you an extra $3,000 per month. Um, thanks for confirming how woefully overpriced your house is?

I mean, who in their right mind would sign up for that happy horseshit?

And when you factor in the further asset deflation guaranteed to transpire during 2009, the monthly bloodletting is almost too enormous to comprehend.

Where is a super rich, incredibly homesick Japanese vending machine tycoon when you need one?

HOA Headaches

It's wholly unrelated to Long Beach real estate, but I just had to share this. Two of my favorite things in the world, Jay-Z and Radiohead, have been combined into one clever, impressive package:

Friends, I present Jaydiohead (Check it out before he gets served with a cease and desist).

Anyhow, back to real estate.



Address: 1310 E OCEAN Blvd #105
Asking Price: $250,000
Year Built: 1984
Size: 1 bed, 1 bath, 1,000 sq. ft.
$/Sq. Ft.: $250
MLS#: R810999
On Redfin: 16 days
Down Payment: $50,000
Monthly Payment: $2,000
Income Requirement: $71,000
Description: FINALLY! A DEAL ON OCEAN BLVD. DIRECT ACCESS TO THE BEACH, CENTRALLY LOCATED NEAR BELMONT SHORE, THE PIKE, PINE ST, EAST VILLAGE, BELMONT SHORE, NAPLES AREA AND A BIKE RIDE AWAY TO SHORELINE VILLAGE AND THE AQUARIUM. OR TAKE A SHORT WALK TO COFFEE SHOPS, RESTAURANTS AND SHOPS. UNIT INCLUDES: LAUNDY FACILITY, CABLE AND INTERNET READY , TILE COUNTERTOPS WITH TILE FLOORING WITH NICE OPEN FLOORPLAN WONDERFUL AMMENITIES: STATE OF THE ART GYM, SUANA, HOT TUB, POOL, CABANA, 24 HR SECURITY GUARD, AND ACCESS TO THE BEACH AND JOGGING TRAIL ,ETC. 1000 SQ FT 2 SUBTERRANEAN PARKING SPACES

"LAUNDY?" "AMMENITIES?" AND TURN YOUR STUPID CAPS LOCK OFF!

The short sale price on this (enormous) ground-level apartment represents a 50% loss in two-and-a-half years. Yikes! What do you call something shorter than a short sale? A squat sale?

And to understand why condos are taking such a severe beating (and will continue to do so), all you need to do is peek at the greed-faced insanity that transpired during The Great Housing Bubble:

Aug 08, 1988 - Sold $210,000
Nov 22, 1999 - Sold $198,000 (11 years of ownership, and all I got was this lousy loss)
Mar 25, 2005 - Sold $432,000 (1999 owner walks with $200,000 after holding for 5.5 years)
Jul 03, 2006 - Sold $510,000 (2005 owner squeaks out a cool 50 grand for 15 months of ownership)

That's right my friends, this joint sold near the peak for $510 per square foot. Sweet Rosie O'Donnell that's insane! And insanely unsustainable.

So, after a 50% discount from the 2006 price (and a 28% reduction from the original asking price), we're hovering above the sales price from THE FREAKING EIGHTIES! But it's still not an attractive buy.

Por que?

Those three familiar, eternally dreadful letters strike again:

H

O

A

In this case, we're talking $725 smackers per month.

Did your intestines just roll up into an arbor knot? Ouchies.

So your monthly payment FOR A ONE BEDROOM APARTMENT goes from a more-than-manageable $1,300 to a whopping $2,000 instantly. Considering you can rent a two-bedroom with ocean views (this discounted domicile is pool view) for the same price, buying doesn't make much sense.

Who knows, maybe this apartment is really kick ass inside. Of course, we'd never know because the listing agent didn't bother to include any useful photos. Ah, the joys of squat sales.

Oh well, to paraphrase HOvA (get it?), "I got 99 problems but catastrophic depreciation on an overpriced asset ain't one."