Long Beach Foreclosure Numbers

From RealtyTrac.com, here are some recent Long Beach foreclosure numbers (starting with the most distressed):

90802: 569

90813: 525

90810: 472

90806: 439

90804: 373

90815: 180

90803: 132

90814: 95

As you can see, downtown is getting absolutely inundated with foreclosures. Not surprisingly, downtown and the shadier areas of LB are experiencing a much larger influx of bank-owned properties and the resultant downward pressure on prices.

Better neighborhoods (Naples, Belmont Shore, Belmont Heights) are faring MUCH better on the foreclosure front, which explains the stickiness of prices there.

And yes, there will be added pressure in 90803 and 90814 during the next few years as "Classy-People Loans" implode. However, don't get your hopes up for $150 per square foot in The Shore. The Alt-A/Option ARM disaster will take YEARS to play out and we've already seen how skilled banks are at delaying REOs from hitting the market and how the .gov encourages banks to mark these troubled loans to fantasyland valuations.

Plus, unlike the crappy zips where any sub-prime knucklehead suddenly became eligible for home purchase, the good 'hoods have more established owners with equity. These people (although there are probably not many who resisted hitting the housing ATM) are MUCH less likely to bail simply because they're underwater--they actually have something to lose.

Not so for those who squeezed into Belmont Shore, Belmont Heights, and Naples during the Pick-a-Payment, no-money-down, live-way-beyond-your-means bubble years. I have no idea how many of those "owners" there are in the nicer areas, but you can bet your bottom (tax) dollar they'll moonwalk away from their obligations the second they realize the mid- to upper-tier housing market isn't coming back anytime soon.

There is No Quit on Mariquita!

Address: 2740 E Mariquita St, 90803
Asking Price: $519,999
Year Built: 1918
Size: 2 beds, 2 baths, 1,508 sq. ft.
$/Sq. Ft.: $345
Purchase price: N/A
Purchase date: N/A
MLS#: P624097
On Redfin: 466 days
Down Payment: $104,000
Monthly Payment: $2,900
Income Requirement: $150,000
Description: Check out the new low price on this once in a lifetime opportunity waiting for you. A craftsman style house sitting on a bigger than average sized lot(was originally two lots) on a cul-de-sac, zoned as an R2A, accesible from 3 sides (front, side and rear). The house is a very spacious 2 bedroom home with a large living and large family room with firepalce. It is in a prime location, walking distance to the ocean, schools and shopping. Needs work but with some love and care this house could be a dream come true. Must see to appreciate.

Good God, this place is depressing. It just screams probate sale.

The good news is the listing agent wrote one of the most unintentionally funny listings ever. Aside from failing to correct "accesible" and "firepalce" despite 466 days on the market, here are some other things I found amusing:

"Check out the new low price..."

Today is June 5, 2009. The listing price was last changed 47 days ago. Even on Planet Realtron, that's considered "new"?

"...on this once in a lifetime opportunity..."

When you say lifetime, are you referring to the amount of time this property has spent on the MLS?

"...waiting for you."

...in the shadows, with its grey, hollow eyes glinting in the candlelight as death's hand curls its cold, bloodless fingers around your throat...

"A craftsman style house sitting on a bigger than average sized lot..."

Come on. Everybody says theirs is bigger than average.

"...accesible from 3 sides."

Something I look for in a girlfriend.

"Needs some work."

Yeah, you can say that again. Holy Antiques Roadshow, Batman, get a load of those ovens!

"...with some love and care this house could be a dream come true"

With some love and a demolition permit maybe.

"Must see to appreciate."

Yikes, three pictures and I've already seen enough.

Here's my favorite part of the listing:

"Listing Price Excludes: Oil rights and chandeliers"

Are you sure they're excluded? Because your insane asking price sure seems to indicate access to the oil under that thar soil.

And those chandeliers...

...yeah, I can see why you'd want to hang on to those precious heirlooms.

Who the hell would want those nasty things anyway? Hell, I'll pay you to take them!

In fact, I'll throw in another couple grand if you promise to take the carpets, wood paneling (yes, the exterior too), blinds, ceiling tiles, kitchen cabinets, vinyl floors, feral dust bunnies, every single appliance, overwhelming sense of dread, and however many animal carcasses are left in the attic.

This place needs way too much work. It should really be listed as a Fixer-Upper because I can't imagine anyone would consider this "turn-key." There is a conspicuous lack of improvements/upgrades in the description, which leads me to believe there is substantial deferred maintenance. And on these 90+ year-old LB homes, that translates to major moolah in roofing, plumbing, insulation, and heating.

I'll never understand people like this. Never.

This place was purchased ages ago (the 2008 property taxes were $786, if that tells you anything) and has a metric ton of equity in it (and obviously no HELOCs were taken out for upgrades). Yet in the fall of 2008, just after the start of one of the worst financial crises ever witnessed in the history of the planet, this house goes on the market asking an astoundingly greedtarded (even for Long Beach sellers) $625,000.

WTF?

After a few meaningless price reductions, it sat there at $575,000 for a solid SEVEN MONTHS before the next price cut. And after the seller resumed their half-hearted attempt to chase the market down, here we are today still asking way too much for a house in this dilapidated condition.

It's all gravy at this point, so why not just price it competitively and take whatever the market gives you?

The answer, as always, starts with a G, ends with a D and isn't gerrymandered.

Say it with me kids:

G
R
E
E
D

As bogus talk of economic recovery reaches a fever pitch this summer, I wouldn't be surprised to see a $20,000 price increase.

Swan Song on Signal Hill

Address: 2155 Ridgeview Terrace Dr, 90755
Asking Price: $1,050,000
Year Built: 2003
Size: 4 beds, 4 baths, 3,322 sq. ft.
$/Sq. Ft.: $316
HOA Fee: $96
Purchase price: $1,350,000 (ouch!)
Purchase date: 7/2007
MLS#: P672245
On Redfin: 135 days
Down Payment: $210,000 (at a minimum)
Monthly Payment: $6,700
Income Requirement: $300,000
Description: This is a spectacular executive home in a private, secluded and secure gated community on the upper East Side of Signal Hill. Soaring ceilings throughout the home. Unique, split level floor plan with a massive upper level master suite. Stunning Easterly views from Los Angeles to Anaheim and Newport! Many, many upgrades including huge gourmet kitchen with granite counters and center island and stainless appliances. The upper level features a living room with fireplace, dining area and 2 private patios which have gorgeous views to the East. Hardwood floors and high quality carpeted floors can be found throughout. The lower level features 3 more bedrooms and 2 bathrooms and a large, central family room that features a fireplace and opens onto the beautifully, landscaped, private rear yard!Plasma T.V's and washer/dryer NEGOTIABLE.

What was this guy thinking? In the summer of 2007, just as stress fractures appeared in the foundation of the economic house of cards, this guy decided to pay $1,350,000 for a home that sold for $750,000 just three-and-a-half years earlier. In Signal Hill?!

Dude, you paid almost DOUBLE what the previous owner paid! That didn't send up red flags?

Also, how did it feel to write those $9,000 property tax checks every year? I'd rather pour lemon juice in a self-inflicted retinal papercut than be in your shoes come tax time.

I haven’t been to Signal Hill in a long time, and I had no idea they built so many of these Orange-Countified monstrosities up there.

From the price and the description, you would think this place was the Hearst Castle. One look at the pictures and it’s abundantly clear that this is just a basic, cheaply-constructed housing bubble box of bland.

Exhibit A, bargain bin Home Depot cabinets and what appears to be cheap-o white tile counters (not to mention builder-grade lights):

(BTW, way to replace that burned-out bulb above the tub. Do you let smoke detectors with low batteries chirp during Open Houses?)

Exhibit B, ultra-cheap aluminum mini-blinds:

The kitchen looks okay, but the cabinets are definitely not those you’d expect in a million-dollar house.

If you slap a seven figure price tag on a house, you better come correct with some crown molding and plantation shutters. Otherwise, it's pretty ridiculous to ask a cool mil.

Here's the bad news, pal:

Assuming you could find a buyer pulling in $300,000 per year that has (at least) $210,000 for a down payment and is totally cool with taking out a ~7% jumbo loan resulting in a monthly debt load of $6,700, your loss will be a staggering -$363,000.

And here's the really bad news:

That buyer doesn’t exist.

And even if she did, she sure as shit wouldn’t be shopping in Signal Hill.

How do I know that? Because during the last six months, only one comparable house has sold. ONE!

And that recently-contstructed 4 bed/3 bath went for $695,000.

Ouch.

Nobody is buying these overpriced Signal Hill goliaths because for the money, there is no obvious advantage over other areas of Long Beach.

What's that you say? These Signal Hill properties deserve a premium because you can't find newer construction this big in LB? Well, I wonder what this 2006-built 5 bed/4 bath home in highly-desirable Belmont Heights would have to say about that:

371 Ximeno

Plus, for this kind of loot, discerning buyers with any brains would move to Irvine:
23 Valley Terrace
62 Sanctuary

Or Rossmoor:
12441 Chaucer
12311 Kensington

...and enjoy top-tier school systems, very low crime rates, Orange County zip codes, and nice, clean surroundings. Signal Hill is adjacent to some of the worst, bullet-riddled parts of Long Beach!

Yeah, man, you’re in trouble. Unless you can find that 210k down, 300k per year buyer who doesn't prioritize her kids' education, you don't stand a chance against this kind of competition.

There simply is no market for these homes. They never should have been built in the first place because in the absence of sleight-of-hand loans and egregiously loose lending standards, Long Beach incomes simply can’t support these prices. And even if they could, the money would go a lot further in Orange County or better, safer, Long Beach neighborhoods.

The fact that Long Beach's Emporer has no clothes has never been more succinctly illustrated than by these types of houses, and I fear for the owners on the hill who only figure this out once it's already too late.

Will 2003 Pricing Get the Job Done?

Address: 850 E Ocean #812, 90802
Asking Price: $399,000 (another listing for this property is asking $395,000)
Year Built: 1992
Size: 1 beds, 1 baths, 1,026 sq. ft.
$/Sq. Ft.: $389
HOA Fee: $612
Purchase price: $580,000
Purchase date: 6/2006
MLS#: P689550
On Redfin: 226 days
Down Payment: $80,000
Monthly Payment: $2,700
Income Requirement: $113,000
Description: Bought $580,000 June-2006 super sharp better than model. all built in, beautiful bathroom totally remodeled updated, special order cherrywood cabinet built over $70,000. move in conditions, ocean view condo with direct beach access 24hrs front desk security. cctv and cameras. key card limited access GYM, sauna, pool, library, lot of guest parking many more come and see. ..

That could be one of the worst, most illiterate, English-as-a-second-language listings ever featured on the Long Beach Housing Blog.

And did you notice the multiple references to security features? To wit:

“guard”

“front desk security”

“cctv” [Closed Circuit Television]

“and cameras”

“keycard limited access”

Just what is the listing agent trying to tell us?

As the listing so proudly highlights, the seller purchased this ONE BEDROOM apartment in the summer of 2006 for a jaw-dropping $580,000. It took more than two years for that crushing $4,000 monthly payment to finally take its toll, and the condo inevitably went up for sale.

But it was too late to get out without sustaining a massive loss…and he knew it. Last October it was listed it for $498,000--locking eyes with an instant loss of -$181,000 including commissions and (alleged) upgrade costs.

Brutal.

But, losing $181,000 in 2008 would have seemed like a hot oil massage from Megan Fox compared to the nail-biting distress in store for 2009. You see, as the market continued to dive the seller desperately chased it down, only to watch in defeat as the market, preening and sneering, consistently remained a few steps ahead.

And now, with a re-listing and a new asking price of $399,000 (a 32% haircut from his purchase price), he is hoping his market-chasing days are finally done.

Assuming he could find a buyer to put him out of his misery and slap down $399,000, it would represent a staggering loss of -$275,000.

How on Earth is this not a short sale?

And those loss calculations assume someone is interested in a $400,000 one bedroom apartment. Frankly, I don’t think 2003 pricing territory will cut it and this place has much more market chasing to do.

First, compared to the average square foot price of Sold homes in this area ($225), this place must be pretty "special" if he thinks it's worth $389 per square. He and his listing agent would likely argue that the upgrades justify the premium.

Okay. Sure.

But after scoping these photos, it doesn't look that impressive. Hell, it doesn't even look that big!

The bathroom is nothing special:

And there isn't even an ocean view:

It's a bold move to call this “better than model” specs, but hey, whatever it takes to garner some interest, right? Who cares if after the Open House potential buyers walk away with a chronic case of the "Mehs"?

Second, there is some strong competition in the area. Here’s a 2 bed/2 bath across the street asking $269,900.

Yeah, I guess it’s not "totally remodeled," but with the $125,000 you save I’m sure you can manage to create a pretty swanky living environment and still have plenty of cash left over.

True, some nearby condos are asking way more than our featured seller, making this unit seem cheap in comparison, but most of them have been rotting on the MLS for ages with no interest.

Finally, any smart buyer would run away from these buildings because of the exorbitant HOA fines and potential for new Special Assessments and Loss Assessments as "owners" sink further underwater and bail on their obligations. It looks like there are at least 11 units for sale, all competing for a limited number of well-heeled buyers and adding to the distress of fellow sellers and owners alike.

That is a scary position to be in.

I don't think this place has a shot at selling at its current 2003 pricing (I also don't think it will reach its 2000 price of $216,000). How high-HOA, non-ocean-facing units like this will be valued at the bottom is anyone's guess, but now that voodoo Liar Loan, Option ARM bullshit loans have gone the way of the dodo bird, I fail to see how Long Beach incomes can support these prices.

Debtor's Prison

Address: 1392 Grand, 90804
Asking Price: $145,000
Year Built: 1995
Size: 2 beds, 1 baths, 440 sq. ft.(!)
$/Sq. Ft.: $330
Purchase price: $190,000
Purchase date: 3/2004
MLS#: P672669
On Redfin: 130 days
Down Payment: $44,700 (That’s 30%. Sorry, but no bank is going to let you put only 20% down on a place like this)
Monthly Payment: $780
Income Requirement: $42,500
Description: This will be a 'Short Sale' Lein holder must accept the offer. Cozy 2BRs approximately 9x9 each sq.ft. Lovely little remodeled kitchen with appliances: refrigerator, laundy hook-ups, stove & microwave, dishwasher, garbage disposal and new faucet. Tile linoleum floors, carpet in bedrooms and living room. Light & airy with skylight in livingroom. Owner ready to move out of the area. Call Agent to preview anytime, call for an appointment

I just consulted my realtor-to-English translator for “cozy” and found, “Wards of the state prison system have more living space.”

By the way, that’s not a joke.

The average size of a U.S. prison cell is 8’ x 12’. These bedrooms are only 9' x 9'. Yikes!

I mean, the lot dimensions are in the double digits for crying out loud (33' x 30')!

And to complete the prison analogy we have the delightful iron bars on the doors and windows:

Charming!

The good news is that there are in-unit "laundy" hook-ups. The bad news is they are located in the living room:

The only thing crazier than the current asking price for this matchbox is the 2004 purchase price of $200,000. Within the context of the fraudulent appraisals and loose lending we’ve seen in Long Beach, 200k might not seem that egregious but...

COME ON, HAVE YOU SEEN THIS PLACE?!

Do yourself a favor and check the Aerial View on the Redfin link.

Tell me that doesn’t resemble a cell block in Fulsom.

Sorry, but this is tenement housing for the poverty-stricken and nobody, and I repeat, NOBODY will buy this as an owner-occupied unit. This is only for incredibly stupi--ERRR, ambitious landlords looking for investment properties. And none of them would touch it with a ten-foot pole and rubber gloves for this ridiculous asking price.

With a monthly nut of $780? Puh-leeze. There is no way this refrigerator box rents for that much.

Plus, why would they overpay for this thing when they can buy this 2 bed/2 bath apartment, at double the square footage, with two underground parking spots, in a better (I use the word “better” very loosely) area for 100k?

That’s a payment of $550. Assuming the bank lets it go for that price, that will definitely be a cash flow positive property. Whether you’d want to be a landlord there is a different story but the point is, this fool’s Marlboros are filled with crack rocks if he thinks he’s going to get 150k for this exercise in contortionism.