Prices returning to 2002 levels
Im actually surprised how fast this is coming down. We just had some sales at 2002 price levels. That is right. 2002! In other words, 3 extremely bullish years and 1 not-so-bullish year have all evaporated. Obviously this depends on the deal you got at the time and just how gullible a buyer you can find today, but this is quite facinating.
1445 Beryl St
San Diego, CA. 92109
1 bdrm, 1 bath, 544 sqft house on a 3100 sqft lot
Year Built: 1952
Original Purchase Price (09/02): $350,000
Sales Price (12/06): $356,500
So..... he experienced $6,500 in appreciation over almost 4 1/4 years. There might have been an intermediete sales on this one. I'm getting some different results from different sources. In the end, I guess it is irrelevant because it still sold at it's 2002 price.
Crazy... just crazy. Sorry no picture on this one... but here's a crazy frog instead.
| Purchase Price | $350,000.00 | |
| Sale Price | $356,500.00 | |
| Association Dues | $0.00 | |
| Holding Period(mo) | 51 | |
| Mortgage Paid | $96,687.50 | (6.5% interest only) |
| Closing Costs | $4,000.00 | |
| Property Tax | $18,593.75 | |
| Estimated Monthly Rent | $1,000.00 | |
| Estimated Monthly Loss | $729.58 | (if rented) |
| Estimated Monthly Tax Savings | $530.83 | (using 28% tax rate) |
| Sales Commission | $21,390.00 | |
| Total Loss | $56,098.75 |
I guess one listing isn't enough to say we are at 2002 levels.... so here's another one:
4015 Crown Point Dr #203San Diego, Ca. 92109
1 bdrm, 1 bath, 686 sqft condo
Year built: 1973
HOA: (might be wrong on HOA, I'm getting different numbers on this one) $240
Purchased (02/02): $345,000
Sold (01/05): $432,000
Sold (06/06): $426,259
Sold (12/06): $340,000
Here's the calculator on this one... I'm just going to calculate from the most previous owner because otherwise I'd have to add in multiple commissions and closing costs. Also, the loss would be almost completely experienced by the final owner (which I think ended up being the bank with this one, but I'm not sure)
Can we say POP yet?
| Purchase Price | $432,000.00 | |
| Sale Price | $340,000.00 | |
| Association Dues | $240.00 | |
| Holding Period(mo) | 6 | |
| Mortgage Paid | $14,040.00 | (6.5% interest only) |
| Closing Costs | $4,000.00 | |
| Property Tax | $2,700.00 | |
| Estimated Monthly Rent | $1,000.00 | |
| Estimated Monthly Loss | $1,374.80 | (if rented) |
| Estimated Monthly Tax Savings | $655.20 | (using 28% tax rate) |
| Sales Commission | $20,400.00 | |
| Total Loss | $124,648.80 |
posted by Sven at
11:36 AM
20 Comments:
WOW! And everyone said you could not go back in time again. We are back to 2002. Note to self: Buy Google at $89 a share and sell to "Professional Investor" at $500 a share, pre-split. "Because Google is special, and no other company will ever invent a better Search Engine/Click Revenue business model then the kids at stock symbol Goog (I mean $499 a share. I had to google the price just now)"!
By
Anonymous, at 1:20 PM
Holy KRAP PB Bubble man. Still when you think about it 340 for a 1 bdrm is alot of money. Its not even in a nice part of PB. Far from the usable bay and the beach.
Josh
By
Anonymous, at 4:35 PM
$1,000 seems a tad low for rent on a stand-alone house, even if it is tiny on a minuscule lot. Glad to see one of these small bungalows made it out of the bubble alive. (Riviera has had a bunch torn down recently.)
By
PBRenter, at 4:42 PM
I love love love it.
However, we're just begging to see some 2004 prices in the OC. 2003 prices look to be a LONG way off. Our little condos would need to drop another $60-150k to get into that territory.
By
oc_fliptrack, at 7:09 PM
I noticed Orange County was about a year behind San Diego County when the runnup occurred, and it appears to be about a year behind on the way down. It is amazing to listen to people here. They watch the destruction happening everywhere else, and they remain convinced it is not going to happen here. It's different here you know. Right.
By
IrvineRenter, at 7:10 PM
PBRenter: It does seem like we lost something when all these neat little houses got torn down to make way for condos. In this case, the owner would break even on interest/tax lost (with his 2002 purchase price mind you) if he could rent it for about $2200 a month. $350k for a 3100 sqft lot with a shack on it... That's not a horrible price actually. I think it'll get a lot better than that though.
Anon 4:35, Yeah. I don't get it either. The best 1 bedrooms in PB shouldn't be selling beyond the 200's. (and this isn't the best)
OC_FlipTrack, I agree with IrvineRenter on this one. Places like San Diego, Miami, San Fransisco, Sacramento, etc... have been spearheading the bubble. It makes sense that we'll be the first ones going down too. There isn't a doubt in my minds that we'll see 2000 prices soon enough.
By
Sven, at 12:59 AM
Right out of college in '91 I lived on an old boat in Mission Bay. Didn't run, but the slip was only $200 and I bought the 36' old Cris Craft for $3K. I went home to Oregon in '93. Went back to San Diego last summer for two weeks chillin at the beach. This is awesome news. People in SoCal can't sell and move up here to price us out anymore. You guys are getting shafted just like all the people who bought shares of Exodus and JDS Uniphase at $100/share back in '99. I got a call from a headhunter in LA recently and I said it would take minimum $200K/yr to get me back down there, plus relo.
By
Anonymous, at 4:43 PM
our neighbors place burned to the ground on Lamont and PB Drive.
I just drove by today, its been turned into a dirt lot today and ready for building.
By
Anonymous, at 4:53 PM
Californians (and other upscape urbanites)are in a speculative bubble of their own creation. As native citizens out here in regular America it is going to be great hearing a loud POP in 2007. Personally I'm hoping a lot of speculators get burned real bad. LOL!
By
Anonymous, at 4:13 AM
Unfortunately the worst is yet to come. By the end of 2007 the economy will turn down and this will be labeled a recession and by 2010 the situation will be talked about using the word global depression. These houses you are displaying on this webpage will be worth less than half of what they are now selling for within 5 years. I am sure this may sound far fetched to some and just as far fetched as when I told my Florida condo buying friends in August of 2005 that they were buying into a peaking market but this is coming. The triggers are already in place. Factor in that in the next 20 years global warming induced weather changes are going to wreak havoc on coastline real estate. The future can be clearly predicted. Home prices have peaked for this generation.
By
Anonymous, at 6:37 AM
What craziness! I can't conceive the prices to live in overcrowdwd, smoggy so cal. I sold my place in philly last summer and bought a place in a beautiful, rural area.(exact location not disclosed on purpose)
3br brick home on 1 1/4acre, 360 views, pure well water for $85000
By
Anonymous, at 11:36 AM
Sven it's actually much worse at 4015 Crown Point Dr.
Latest issue of Beach and Bay Press(back page) 1BR/1BA
"SHORT SALE" $249,000-299,000. Hey and it says"This property would make a great investment".
Wonder if the realtwhore told that to the chucklehead who paid $340k for #203 all the way back in 12/06?
The actual address is 4015 Crown Point Dr 104
http://tinyurl.com/y4y5w9
btw I second your comment re. how fast this is moving and I'm a housing bear.
By
bub, at 4:45 PM
Oh wow, 249k. I bet the guy that just bought #203 is pissed. Keep in mind that every single unit in this complex has the basically the same view. They all point towards the bay. So, the only advantage 203 has over 105 is that he's one floor up (note even the first floor is still a floor up. )
Anyway, for something to be offered 100k less the next month... wow.
I was just looking at a 2bdrm recently that is being offered for the low 300's, and it's a nice unit in the nice complex. I have a theory on this though. I think the sudden collapse of the sub-prime lending market has pulled out the last remaining buyers. We might be seeing the "Great Housing Crash of 2007".
BTW, for new readers, there have been several posts about what happened at the Crown Point Villas in the past. You can do a search on this blog and read up all the details. It was a major fraud case with an investor using stolen identities to buy properties. This is one of the reasons they are paying 25% more in HOA fees right now.
Just think, in another year or two, you will be able to buy a nice 2bdrm in the low 200's. (one just sold for 285k)
By
Sven, at 6:20 PM
As of January 2007, I see this downward trend also occurring in the extremely over-priced markets of north Long Beach, 90805. Check out those absurd prices @ Realtor.com 90805. My partner and I owned a nice 2Br1B house in 5400-block of Cerritos Av. for about a quarter century -- a great rental property. Only during the past several years, prior to selling it, did prices begin to soar out of sight! It was unbelievable, and prices even continued upward after selling it. Without banks and appraisers participating, none of that would have occurred. Increased prices translated to higher PROP TAXES..$$ to fatten the coffers of county/city retirees! We SOLD it a couple years ago: $380k; and it continued "appreciating" to about $420k, and during that time it has been SOLD twice again! Absurd! Now it is back on the market a third time, needs some tender care, and am uncertain of the price, though it is dropping right now. Horrible speculation, rather than decent long-term investment, has hurt many people. FYI: There is a trend developing, even in nicest areas, whereby small rental cottages, or so-called "granny units", are becoming a big deal for many owners who simply need the additional mthly income provided to make ends meet, since many retirees lost enormous amounts stolen from pension funds .....since about year 2000, or so. The LA TIMES has published several interesting articles on 'granny units'. Long Beach is trying to hold out on R-1 properties, but many people in that area were attempting garage conversions -- no-one used those garages! -- and the city receives reports, and threatens law suits on those conversions. 'Granny units', and garage conversions in some of the nicest neighborhoods is not at all uncommong these days! This is happening all over LA County. Disastrous speculation in housing markets will likely change, as markets turn downward. The lowly soldier gets now help in housing, while the firemen, the police, the school teachers (good!), receive houses at half-price, now extended to emergency drivers, too; but nothing much to help vets fighting for oilgarchs crapola in Iraq! Impeach the bastards now!
By
Anonymous, at 11:02 AM
As of January 2007, I see this downward trend also occurring in the extremely over-priced markets of north Long Beach, 90805. Check out those absurd prices @ Realtor.com 90805. My partner and I owned a nice 2Br1B house in 5400-block of Cerritos Av. for about a quarter century -- a great rental property, always great rent demand. Only during the past several years, prior to selling it, did prices begin to soar out of sight! It was unbelievable, and prices even continued upward after selling it. Without banks and appraisers participating, none of that would have occurred. Increased prices translated to higher PROP TAXES..$$ to fatten the coffers of county/city retirees! We SOLD that small LB rental house a couple years ago, after major refurbishment's and upgrades --was one of the very nicest houses on the block for decades: SOLD $380k; and it continued "appreciating" to about $420k, and during that time it has been SOLD twice again! Absurd! Absurd that empty pocket speculators, who otherwise could not afford or quality to buy, could buy a very nice house with virtually no money down! Now it is back on the market a third time, rear yards needs some tender care, and am uncertain of the price, though it is dropping right now. Horrible speculation, rather than decent long-term investment has become the norm, and has hurt many people. FYI: There is a trend developing, even in nicest areas, whereby small rental cottages, or so-called "granny units", are becoming a big deal for many owners who simply need the additional mthly income provided to make ends meet, since many retirees lost enormous amounts stolen from pension funds .....since about year 2000, or so. The LA TIMES has published several interesting articles on 'granny units'. Long Beach is trying to hold out on R-1 properties, but many people in that area were attempting garage conversions on their R-1 properties -- no-one used those garages! -- and the city receives reports, and threatens law suits on those conversions. The County of LA, and County Supervisors, wants to allow all R-1 properties to be able to build a small rental cottage, or 'granny unit', that will conform with building standards of each neighborhood, not appear unsightly. Long Beach is totally opposed to that prospect. 'Granny units', and garage conversions in some of the nicest neighborhoods is not at all uncommon these days, not even in 'Friendly Hills' of Whittier! This is happening all over LA County.
Disastrous speculation in housing markets will likely change, as markets turn downward. The lowly soldier gets little help in housing, while the firemen, the police, the school teachers (good for them!), receive houses at half-price, now extended to emergency drivers, too; but nothing much to help vets fighting for oilgarchs crapola in Iraq!
Impeach the neo-con bastards now! Make the oilgarchs pay all of us back, too! Costs for utilities and gasoline soared far beyond ordinary rental rate increases!!! That has all been major theft from the pockets of all Americans -- high-cabal thievery. The literal bankrupting of American middle-class is underway.
By
Anonymous, at 11:17 AM
We still need these prices to fall. when Median Income matches MEdian Housing Price. Which is about $90K For a 1 Bedroom Condo and About $180K for a Nice Family Home. LEts get real on Family homes. Would you really buy your first home for your family of 2 kids, for $600K? And afford a payment ok 4-5K a month? You tell me the average Family person makes $250K a year? It is more like $50K
By
Anonymous, at 9:29 PM
How about the Bay Area ?
I'm desperate to finaly see something like this here. Many people try to convince me the Bay Area is really special.
I don't think so.
I want it here, and i want it right now !
By
Anonymous, at 11:32 PM
There is something funky going on with 1445 beryl because a trust deed shows up in 4/06 and the price was below 100k. Before that there is more that goes on. First the original buyer in 9/02 bought with 100% financing. Then they get a HELOC for $150k in 7/03 and after that some strange quit claim deeds happened. Back to the trust deed sale 4/06 the guy who bought it "sold" it in 12/06 to a corporation who then sold to the new FB and in the same day in 12/06. There is more to this story that we will probably ever know.
By
graphrix, at 1:31 AM
Yeah, I'm not sure what's going on at that house. It could be some elaborate tax shelter stuff, or a mortgage fraud scheme. It's hard to tell. As for the Bay Area being special, that happens in every market no matter what. People always say that their stock, their neighborhood, their area, their whatever is not at all like everywhere else and is immune to market forces.
Everything gets hit by market forces. Some places get hit harder, but it hits everyone. It's true that local factors will also have an impact. If jobs are coming in or going out, etc... The Bay Area is so over-inflated that it will be hit just like every other over-inflated area. San Diego was just one of the most inflated, so we are getting hit pretty early on.
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Sven, at 1:41 AM
I think this just shows how vulnerable condos are. Land has value and most around San Diego don't have HOA fees. The math you're doing is what I did a couple years ago. If you're buying, stretch for a house with property. My valuation is 75% property and 25% house. And my house was a bigger peice of shit when I bought it so there is some incentive to pay a little more. Nonsense home appreciatin without some upgrading or invenstment is long gone.
By
Anonymous, at 10:47 PM
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