New Year activity

I am seeing a lot of new listings lately. I found a few that are losing money, but I'm going to wait for the first reduction on each before I post them. One thing I like to marvel at is when listings show up that make you want to raise an eyebrow to the seller and ask "Did you even think about checking the comps first?". I call them the "Bubble Boy Awards" for people who just have no concept of the cyclical nature of the real estate market. These people aren't doing themselves a favor by asking for so much. The properties are more often than not vacant, and they are just eaten alive by holding fees while their property collects dust. Sell it or Rent it, don't just sit on it... unless you hate money that is. Just think, there are people who haven't sold their properties from 2005 with multiple tiny price reductions. If they had only dropped the price to the current levels to begin with, it would have sold quickly, and they would have been able to keep all the holding fees in between.

Just think, how much is $100,000 of your time worth? Three years? Two years? One year? 6 months? Yet people expected for their properties to appreciate this much in a year with very little effort.

A good example is:
4028 Lamont
San Diego, Ca. 92109

2 bdrm, 1 bath, 1,016 sqft house on a 2900 sqft lot
Year Built: 1951, 1 garage parking
Asking price: $700,000 ????

It's in Crown Point, but you don't exactly have an ocean view. Now, I consider almost all prices to be over-inflated today, and I honestly believe this will be vindicated in a year or two as the "sticky-correction" occurs (a common concept in real estate that prices tend to move up quickly and go down slowly, therefore down periods typically last longer than up periods). A place like this is just..... mind-boggling. Especially when you can easily find a much better deal.

Here are some comps to prove this sellers "Bubble Boy" status:
1. 3850 Riviera Dr. 1B ($700,000), which has a great front-row view of Sail Bay, it's 1519 sqft, and 3 bdrm, 2 bath.

2. 1925 Wilbur Ave, 2bdrm 2bath, 1492 sqft ($669,000), which has a private pool, a neat view of Pacific Beach, and it's right next to the Kate O Sessions Memorial Park (which has a remarkable view if you have ever been there).

3. (how about an equivalent comp) 1963 Fortuna Ave ($557,000), 2 bdrm, 1 bath, NA sqft house (it's about the same size as 4028 lamont, 2500 sqft lot. It's basically the same property... only $150,000 cheaper. It's even marginally closer to the water.

Just how many gold bricks did they put in the walls to add $150k to the value?

Comments?

Also from the mystery reader: Another Mortgage Lender goes under (Video)

About 1,000 people literally lost their jobs all at once. It was a major sub-prime lender. From what I hear, many sub-prime lenders and sub-prime branches of banks are for sale right now.

Secured Funding also just stopped funding loans as mentioned in this article. Check out the second entry about the scam going on in Temecula/Murrieta. I guess several hundred fraudulent real estate loans in that area have just been uncovered, and this will likely result in a huge impact to the real estate market there.

Crazy stuff, it's a good idea to check your credit report periodically to make sure that you don't end up one of these people being screwed by mortgage fraud. You can do it for free by directly contacting each of the three bureaus.