$500k loss in 4S

Address: 10141 Winecrest
Asking Price: $999,999
Property Tax: 1.407% HOA: $134
Income Requirement: $250,000
Downpayment Needed: $200,000
Monthly Cash Burn: $6,183
Ownership Cost: $5,098

Beds:	5
Baths:	5.5
Sq. Ft.:	4,854
$/Sq. Ft.:	$206
Lot Size:	0.36 Acres
Property Type:	Residential, Detached
Style:	Mediterranean/Spanish
Stories:	2
View:	Mountains/Hills, Valley/Canyon
Year Built:	2006
Community:	Ivy Gate/4S Ranch
County:	San Diego
MLS#:	090045268
Source:	SANDICOR
Status:	Contingent
On Redfin:	21 days

Owner loss is your gain. 5BR Executive Home in Gated Community, gourmet granite kitchen w/ island counter, stainless steel appliances, breakfast bar, loft, office. Engineered Cherry hardwood flooring in living room, dining room and office. Master bath and downstair baths were in middle of upgrades, down stair flooring not complete. Buyer to verify all before COE including HOA fees, property taxes, square footage. Property to be Sold AS-IS. Seller will not provide termite clearance or repairs.

So for a $1million, you don't even get a house free of termites, or useable bathrooms, nor a floor. You don't even get a recent photo of the front or photos of the inside. The front photo is not even straight so the house is slanted.
Sales History: Oct 20, 2006 Sold $1,480,000
So with a 6% commission and a sale at list price, then someone is losing $540,000.

Good Read from the NYT

A good article on the Inland Empire.

A Cul-de-Sac of Lost Dreams, and New Ones

Interactive on 9 owners/homes

Ala Carte Houses

According to the link on BubbleInfo, some houses don't come with add on featues, like a kitchen. What's next? Maybe someone will place ads for roofs, bathrooms, and other option things like walls.

Here's the link to the Craigslist ad.

Foundation Issues

When I started this blog, I was worried that I wouldn't have enough material to keep the blog filled. Then, I see listings like this one.

Address: 14014 Paseo Cevera
Asking Price: $399,000
Property Tax: 1.03% HOA: $0
Income Requirement: $99,750
Downpayment Needed: $79,800
Monthly Cash Burn: $2,570
Ownership Cost: $1,971

Beds:	3
Baths:	2
Sq. Ft.:	1,423
$/Sq. Ft.:	$280
Lot Size:	7,479 Sq. Ft.
Property Type:	Residential, Detached
Stories:	1
Year Built:	1976
Community:	Penasquitos
County:	San Diego
MLS#:	090043017
Source:	SANDICOR
Status:	Contingent
On Redfin:	17 days

Well maintained home in a great location. Walk to schools. Nice floor plan. Close to freeways and shopping. Home has foundation issues. Great opportunity for investors. Property sold "as is". Seller will make no repairs.

Ok, so if it's so well maintained, how come there are no pictures inside the home? The description is such a contradiction in terms, "sold as is" and "make no repairs", yet it is well maintained. So what about those foundation issues - apparently the potential buyer doesn't have a problem with that. What are the chances they will make a cosmetic fix?

Lets look at the sales history:

Aug 14, 2009	Relisted	--
Jul 29, 2009	Listed	$399,000
Nov 01, 1995	Sold	$86,000
Jun 01, 1995	Sold	$77,000
Sep 20, 1989	Sold	$160,956
Sep 07, 1989	Sold	$195,000
Aug 04, 1989	Sold	$95,000

The property is now asking almost 5x the 1995 price. I highly doubt there's been a lot of work done to the interior of the house to justify the 11.5% yearly rate of return. But more interesting is that the price doubled from Aug to Sep 1989, back in the last market frenzy. Then, the price went down to less than the Aug 1989 price in 1995, near the last market bottom.

A picture's worth a thousand .... Sorry, wrong picture

Address: 15078 Avenida Venusto # 203
Asking Price: $187,000
Property Tax: 1.7% HOA: $253
Income Requirement: $46,750
Downpayment Needed: $37,400
Monthly Cash Burn: $1,400
Ownership Cost: $1,115

Purchase Price: $320,000
Purchase Date: 9/29/2004

Beds:	2
Baths:	1.5
Sq. Ft.:	875
$/Sq. Ft.:	$214
Lot Size:	-
Property Type:	Residential, Attached, Other
Style:	Contemporary
Stories:	2
View:	Evening Lights, Mountains/Hills
Year Built:	1988
Community:	CARMEL MOUNTAIN
County:	San Diego
MLS#:	090044291
Source:	SANDICOR
Status:	Active
On Redfin:	9 days

At least we know the realtor is pratical. Why waste time posting more than 1 photo on MLS and 0 photos on Redfin (no address either) when there's little chance the bank will accept any market value offers. I've never seen "Evening Lights" listed as a view before, especially since the view is of RB High School. Fortunately for our realtor, school was not in session otherwise the lone picture of two trees, the road, and bushes might have been blocked by the cars of RB High students.

So after doing some checking on Craigslist, an equilavent rental is asking $1300. Plugging the numbers into a investment property analysis spreadsheet, I get about 3% ROI assuming you get a mortgage deduction and 6% management fees. So this unit is a little bit expensive for an investor, but its definitely closer than it was in 2004. Well, only if the bank likes your offer when they look at it 4 months later.

Delusional in 4S

Delusion would be the understatement of the year on this property. I'm not sure the owner is on the same planet, but he or she should probably get the internet, a realtor, or both. However, I should thank the owner since this listing is so out there, I've finally decided to stop being lazy and start a blog.


Address: 15056 Dove Creek Rd
Asking Price: $2,000,000
Property Tax: 1.66% HOA: $400?
Income Requirement: $500,000
Downpayment Needed: $400,000
Monthly Cash Burn: $13,920
Ownership Cost: $10,900

Purchase Price: $581,000
Purchase Date: 3/26/2004

Beds:	4
Baths:	3
Sq. Ft.:	2,586
$/Sq. Ft.:	$773
Lot Size:	6,500 Sq. Ft.
Property Type:	Single family
Style:	Spanish
Stories:	2
View:	Territorial
Year Built:	2004
Community:	4S Ranch
County:	San Diego
Listing #:	60281392
Source:	Zillow
Status:	Active
On Redfin:	178 days

Hahahaha... so for $2M, we don't even get photos, a description, or even the monthly HOA costs. In June this owner decided he made a $1M upgrade to his house so his house is now worth $2M. So maybe this property is so great a photo won't suffice. Ok, so lets look two houses over.

Address: 15068 Dove Creek Rd
Asking Price: $649,000
Property Tax: 1.5% HOA: $396
Income Requirement: $162,250
Downpayment Needed: $129,900
Monthly Cash Burn: $4830
Ownership Cost: $3860

Purchase Price: $815,000
Purchase Date: 5/16/2005

Beds:	4
Baths:	3
Sq. Ft.:	2,492
$/Sq. Ft.:	$260
Lot Size:	-
Property Type:	Residential, Detached
Style:	Mediterranean/Spanish
Stories:	2
Year Built:	2003
Community:	4S Ranch
County:	San Diego
MLS#:	090017136
Source:	SANDICOR
Status:	Contingent
On Redfin:	145 days

So what makes the first property worth so much more? I don't know, but the toilets better be made out of gold. The second owner has the priced to sell after a $50k reduction in March.

Thanks for reading the first post and thanks to the owner of 15056 Dove Creek for a good laugh.