Precious Peak-Priced Pretender

4301 East 2ND St Unit 2F, Long Beach, CA 90803
Wishing Price: $415,000
Beds: 1
Baths: 1
Sq. Ft.: 900
$/Sq. Ft.: $461
Year Built: 1965
MLS#: P732255
On Redfin: 16 days
HOA: $175
Down Payment: $83,000/$17,000(FHA)
Income Requirement: $95,000
Monthly Nut: $2,400/2,800(FHA)
Description: Beautiful home in the Belmont Heights area. Enjoy the ocean breeze and view from a large bedroom balcony. Located blocks from the beach and Belmont Shore shops and restaurants, Belmont Pier and the Belmont Plaza Olympic Pool. Meticulously maintained with the following upgrades: Bamboo floors throughout, modern walls, refinished cabinets, renovated modern bathroom, subway tile, console sink, remodeled living room with modern built-in shelving unit running expanse of wall, custom closet in bedroom, frosted glass and modern closet doors. Must see as this will not last!

What is a "modern wall"? Is he talking about that bad-ass technology from Minority Report that allows you to access and analyze digital information with the wave of a hand?

Oh.

And notice no mention of in-unit laundry. Community laundry for $415,000?! HA!

I have bad news for you, dude: You are going to lose your ass on this one.

I must concede you've done a decent job upgrading this place, but if you think for one fleeting second you'll walk away from this transaction without your pocketbook sustaining serious blunt-force trauma, you're sadly mistaken.

I keep trying to spread the gospel, but nobody seems to believe me. Look, when you over-improve a property according to your personal whims, you can't expect new buyers to share your identical tastes and stylistic proclivities -- and you definitely can't presume they'll be willing to pay premium dollars and cents for your ideas of good design sense.

To wit:

YEEF.

Dude, you are asking $25,000 more than what you paid at the peak of the housing bubble. I don't care if the garbage disposal is 24-karat gold and $20 bills materialize in your trousers every time you take them out of that shitty IKEA closet of yours...you are not going to get 2007 pricing for this thing.

To give you an idea of what kind of imbecile we're dealing with (as if you needed more evidence), he purchased this 1/1 apartment for $390,000 from a guy who paid just $155,000 seven years earlier.

Really, guy? What were you getting for a WaMu CD back in those days, 5%? 5.5%? That 15% annual appreciation didn't set alarm bells off?

And for that top-dollar price you got a place so crappy that you had to gut it and completely re-do it? Yikes.

I'm no contracting expert, but I'd guess he put $30,000 into upgrades. And that's being conservative. Assuming that's the case, after commissions those upgrade costs will be a total loss. A vanishing act that would make Houdini blush.

And that's assuming this uneven bachelor pad "will not last!" as the realtor so boldly (read: dumbly) claims, and gets full asking price.

A promise:

THAT WILL NOT HAPPEN.

Not with this kitchen, anyway.

Way to chintz out when it comes to the most important aspect of a property. I mean, original stove top and hood? WTF are you thinking?

And those cabinets definitely don't look new. They look (badly) painted with, at best, updated hardware.

Don't get me wrong, overall this is a slick pad in a good building in a killer neighborhood. It has some great attributes. The problem, as with all delusional Long Beach sellers, is the price.

I mean, this nearby property for sale, also with an unimpressive kitchen, is asking $439,000 (he's been on the market for 126 days -- he'll never get that) and features in-unit laundry, a fireplace, an extra bedroom, an extra bathroom, and 450 more square feet of living space. How can our featured seller possibly justify his crazy asking price?

I'm sure you've noticed that owners of these over-designed, over-decorated pads tend to be the most batshit insane when it comes to perceptions of what their "special" places are worth. In fact, this place kind of reminds me of this misguided, thoroughly-impressed-by-his-own-awesomeness fool (who claims to be under contract for full asking!).

They probably both read Dwell under the sheets with a flashlight while John Secada plays in the background if you know what I mean.

Well whaddaya know?

Now we know exactly the type of seller we're dealing with.

Armed with this information, it's guaranteed that this place will never sell. This ego-driven dope will take his self-stroker of a shack off the market long before he admits it isn't special and takes the massive financial hit required to garner a sale.

Well, It Was Worth a Shot: UPDATE II

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!

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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.

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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.

One in the Temple

Address: 2501 TEMPLE Ave #205, Signal Hill, CA 90755
Wishing Price: $379,000
Beds: 2
Baths: 2
Sq. Ft.: 1,179
$/Sq. Ft.: $321
Year Built: 1983
Community: Signal Hill
MLS#: 10-441365
On Redfin: 30 days
HOA: ?
Down Payment: $76,000/$15,000 (FHA)
Income Requirement: $87,000
Monthly Nut: $2,300/$2,700 (FHA)
Description: Elegant condo in prime location. Home boasts laminate wood flooring, central air & heat, washer & dryer, big beautiful fireplace, and a large balcony with view of the mountains. Separate shoots [SIC] for trash and recyclables. Residents enjoy a pool, jacuzzi, clubhouse, BBQ area, tennis court, and a serene courtyard area with a gazebo. HOA dues include basic cable. View this home now before it is sold!

The first sentence of the description, which only contains five words, features two bald-faced lies! This condo is "elegant"?

Really?

And this is a "prime" location?

Naples is a prime location, Signal Hill is a crime location.

Second of all, how are separate "shoots" (anyone with beyond a 3rd-grade reading comprehension knows it should be "chutes") even worth noting? Who gives a crap? You're just doing the trash company's job for them by separating your recyclables anyhow.

But what really caught my eye was the wishing price. Yet another bubble hibernator who missed the memo about the largest residential real estate crash in the history of the world. $379,000 is pure peak pricing, and this dummy has no idea how ridiculous he looks.

This dreamer--ERRR...seller purchased right near the peak of the bubble for $387,500 and honestly believes $379,000 is such an attractive price that you'd better "View this home now before it is sold!"

Is he serious? Does he honestly believe this thing will get snapped up that quickly? Furthermore, if he really did believe that, then why even bother saying it? Seems to me if it's really such an "elegant" condo in a "prime" area, it shouldn't even need a description. A quick sale would speak for itself, wouldn't it?

The only way this piece of donkey dung is selling is on the courthouse steps.


This delusional moron not only missed out on news of the Great Housing Bubble's demise, but apparently also doesn't even pay attention to things happening right under his nose. To wit, an identical unit in this building sold three months ago...for $293,031.

OOOOOOOOOOOOOOOOOOOOOOOOOOOOPS.

And this REO sold in January for a mere $234,900.

"But el bee, distressed properties don't count as comps!"



In this 'hood distressed properties are the market. They're pretty much the only comps. And you're smoking Schoolhouse Rocks if you think those sales don't affect values of non-distressed properties (FYI, the featured apartment is a distressed property. Whether he acknowledges it or not, the fact is he is severely underwater, and thus, distressed. Which means he needs to be priced like his fellow distressed properties or else stop paying the note. Either way, he's toast. There is no good option here).


I don't even need to browse Craigslist to tell you this place doesn't rent for the $2,700 an FHA buyer would need to cough up every month. Hell, even if a buyer put down 20% (unlikely in this lending climate, in this neighborhood), the monthly cash layout would still be $2,300.

Dude, NO WAY this thing is renting for that kind of money. Not even close.

Needless to say, this price is also horrendously out of line with local incomes. The median household, which earns $48,938 per year, would have to pull in double that to reasonably afford this lackluster apartment. This price is like an enigma wrapped in a tortilla of mystery, nestled in a glove box of cryptograms.

But I'm not going to ruin his lil' party. In fact, I'm a really big fan of the Parade of Delusion and I'm going to grab some cotton candy, sit back in my camping chair, and enjoy the show. Because this price (along with the inevitable, completely futile price cuts) is just too entertaining to pass up.

Huh?

Here's an, uh, interesting angle:

Why a Rising Unemployment Rate is Good News

It sounds dreadful. After drifting down consistently since last fall, the unemployment rate has suddenly shot up again, from 9.7 percent in March to 9.9 percent in April. But don't despair: A rising unemployment rate is actually one of the best signs yet that the economy is bouncing back.

The unemployment rate rose for the right reason. Instead of shedding jobs, employers added 290,000 jobs in April, the strongest showing since 2007. The reason the unemployment rate went up is that a lot more people are suddenly looking for work. The government said that the labor force swelled by 805,000 people in April. That's more than three times the number of new jobs, so the proportion of people looking for a job but unable to find one went up. Still, that big increase in the labor force marks an important shift in sentiment among people on the fringes of the economy.

Someone explain that ridiculous logic to me. Yes, it's encouraging that a bunch of people who threw in the towel suddenly feel optimistic enough to start looking again...BUT ONLY IF THOSE 805,000 PEOPLE ACTUALLY FIND A JOB!

I'm amazed at how his rose-colored beer goggles allowed him to write that happy horseshit about "an important shift in sentiment" right after this line: "That's more than three times the number of new jobs, so the proportion of people looking for a job but unable to find one went up." Really? No cognitive dissonance there?

I get that the mainstream media is ready for The Great Recession to be over, but this is just pathetic...

READ THE ENTIRE (RIDICULOUS) ARTICLE...

Saint Stupid: UPDATE II

The price was "$825,000" and changed to "$839,500"

Yeesh. Talk about slack-jawed optimism.

Hey dummy, you've been on the market for 13 months...don't you think it's about time to get serious?

What a delusional idiot.

UPDATE: It gets worse. Remember his (waaaaaaaaaaaaaaay nicer) competition on Monrovia?

After nearly a year of market-chasing, that guy sold in March for $805,000, a monstrous reduction from the original $1,055,000 asking price.

Just why this obtunded fool on St. Joseph believes his hideous domicile deserves a $25,000 premium over the larger, significantly more impressive Monrovia house, I'll never know.

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

The price was "$875,000" and changed to "$850,000"

I have to give him credit for consistently lowering the price, but I've got bad news: on the very same day as his $25,000 price reduction, his (waaaaaaaaaaaaaaay nicer) competition on Monrovia lowered his ask to $835,000 (FYI, that's down from $1,055,000 in July 2009. He's been reducing the price every week since).

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

I apologize for the recent focus on 90803 bungalows, but these nitwits and their delusional senses of entitlement have to be called out.

Address: 222 SAINT JOSEPH Ave, 90803

Asking Price: $875,000
Beds: 2
Baths: 2
Sq. Ft.: 1,600
$/Sq. Ft.: $547
Lot Size: 4,050 Sq. Ft.
Year Built: 1937
MLS#: P694685
Source: SoCalMLS
On Redfin: 157 days
Down Payment: $175,000
Income Requirement: $220,000
Monthly Nut: $4,800
Description: BACK ON THE MARKET!!! Will consider trade for a duplex with a yard. Restored, enlarged Belmont Shore showplace home on a larger lot. 2 bedrooms / 2 bathrooms plus office and den. Gorgeous landscaping with waterfall and pond - featured in Long Beach magazine. Spa. Newewr bathrooms and kitchen. Shower / steam room. Double garage behind available. Forced air heating & cooling, tankless water heater. Fireplace in living room. Crown molding & hardwood floors. Granite kitchen tile and bathroom floors and counter top.

"Will consider trade for a duplex with a yard." Hey fuckwit, for $875,000 I and every other potential buyer want a duplex with a yard too. THAT'S WHY YOUR SHIT HASN'T SOLD IN FIVE MONTHS.

What an idiot.

And speaking of idiocy..."Newewr"?

Really? In a listing demanding nearly a million bones?

Or how about "Restored, enlarged Belmont Shore showplace home." Dude, we're talking about 1,600 square feet. How "enlarged" can it be?

[Speaking of enlargement, you want to know why those boner pill companies are allowed to exist despite being completely full of it (come on, think about it. If that shit worked, they wouldn't possibly be able to produce enough of it. Every single solitary dude on the planet would be ordering cases of the stuff. Bottles would be bursting out of glove boxes and briefcases across the globe. This would become a world of men walking around with tree trunks stuffed into their trousers. Hell, we'd all need motherfuckin' motorized scooters to get around)? Because they vaguely claim that they make you "bigger" and "firmer." But they specifically avoid saying bigger and firmer than what. If we're talking about making you bigger than you were after a few laps in a cold pool, sure. Mission accomplished. But bigger than usual while "in the moment?" They craftily decline to say. And how do you know it wasn't rolling around with your partner that made you "bigger"? You don't. So although there is no way to prove the pill made you "bigger," (more importantly) there is no way to prove it didn't--and therefore the ads were not misleading. Plus, who would be crazy enough to file the first lawsuit bitching that the magic beans he ordered from the interwebs failed to make his (obviously) tiny junk into an unwieldly, Incredible Hulk-sized axe handle? Ta-daaaaa!]

Back to our regularly scheduled thrashing. This dude claims his joint is a "showplace."

Uh, okay. Whatever you say.

And just what does "Double garage behind available" mean? Does it cost extra or something?

With marketing acumen like this, it's no wonder buyers have been straight up ignoring your property since March. That's right. The house has been on the market since Q109 but after just 41 days the seller took their ball and went home when nobody would pay their Wishing Price.

In July the beggar--ERRRR...seller proudly proclaimed, it's "BACK ON THE MARKET!!!", naturally expecting people to give a shit. And it's been rotting ever since with zero buyer interest despite two $50,000 price cuts (both in October, 15 days apart).

Oct 23, 2009 - Price Changed $875,000
Oct 08, 2009 - Price Changed $925,000
Jul 10, 2009 - Listed $975,000
May 07, 2009 - Delisted
Mar 27, 2009 - Listed

Unfortunately, this delusual Long Beach seller lost his discounting momentum just when it seemed like he was starting to understand how this market works.

Sure, this thing is in the Shore, but so what?

How are you going to compete with sellers like this property, on the beach side of 2nd Street? It sports two extra bedrooms, a bonus bathroom, 216 additional square feet and, other than some horrendous wallpaper that reminds me of the end result the last time I drank Jagermeister, is far superior in the looks department (and, well, every other department too).

Answer: You're not going to compete.

Not with your kitchen, anyway:

Woof.

Or how are you going to compete with this cozy nearby property? I have a feeling buyers would be far more willing to pay an extra five grand for an extra bedroom and 200 additional square feet. Just a hunch.

Oh, but this guy has something over all those other properties. As the listing description so thoughtfully and eloquently puts it: "Spa."

Yikes. All I want for Christmas is a staph infection.

Look, cash-flush people (yes, they still exist--despite what the doom and gloomers proclaim, plenty of people are still employed and have cash stockpiles from waiting on the sidelines for years) are going to continue to severely overpay for 90803 properties. That's just the reality of people with more money than brains (or patience). Case in point.

But unless the glory days of 8x income loans and credit cards for housecats return, I just don't see how 222 St. Joseph sells for $875,000.