A reader pointed out this San Clemente short sale property to us. It's a story that has played out countless times already all over Orange County: The owner purchased at the peak, then can't or doesn't want to keep the house for whatever reason and gets the home listed for a wishing price that either a) would be just enough to cover the mountain of outstanding debt, or b) would result in a magical windfall of cash if a greater fool can be hooked in. Either way, it's completely out of touch with the market, so no dice.
The asking price is consequently altered again and again to try and keep up with the sliding market. Has the price been cut enough now so a buyer would be interested, and has it been enough time so the lender would accept a sale at this price?
2237 Avenida Salvador, 92672
Income requirement: $168,750
Purchase price: $975,000
Purchase date: 1/17/06
Size: 2 beds, 2 baths, 1,885 sq ft (built in 1973)
Price Reduced: 9/30/07 -- $1,205,000 to $1,199,000
Price Reduced: 10/15/07 -- $1,199,000 to $1,149,000
Price Reduced: 2/07/08 -- $1,149,000 to $800,000
Price Reduced: 4/10/08 -- $800,000 to $650,000
Price Increased: 4/14/08 -- $650,000 to $675,000
Zillow Zestimate: $792,500
2007 property tax: $3,442
Type: Single Family Residence
Lot size: 7,371 sq ft
From listing: Great opportunity to own a single level ocean view custom home on the street of dreams--this incredible home offers newly remodeled and enlarged kitchen perfect for entertaining family and friends-great room with oceanviews and fireplace-two very large master suites opening to your own private tropical backyard-lush landscape,private oceanviewing spa-plans for second story-this incredible home is in turnkey move-in condition with potential if extra square footage is desired--short sale-reduced to sell this week end open sun 2-4
As you can see from the listing, this property has been on the market for more than six months without a sale. The price was inexplicably raised very recently by $25,000 (or is it a calculated increase to a price the lender would accept?) but a successful sale has not yet been achieved.Can you see this property going for $676 per square feet? That's what would have happened if it sold at the original asking price.
"The street of dreams." What a sad thought knowing that by buying this property the owner ironically ended up stepping right into their own real estate nightmare.
The home has been reduced $600,000 since its original listing - that's a 47% discount. Assuming a sale is made for the full asking price, the loss would be $340,500, including 6% sales costs. Or, it would mean a decline of 31% off the peak, not including sales costs.
The sale before the one in 2006 was in 1995 - at the bottom of the previous real estate downturn - for $250,000. If a $675,000 sale does go through now, it would still mean the property appreciated a hefty 8% every year from 1995 to 2008. Not bad.
8 comments:
Utter douchebaggery
The bank baiting for offers. I am seeing this all over OC now. The bank is not desperate enough yet but instead wants to try and create enough interest to start a bidding war for this property.
well, the inflation calculator
(http://www.westegg.com/inflation/)
suggests that $250k in 1995 is worth $350k in 2007.
how low will it go?
My best guess is that they received a slew of offers. There is no detached SFR under $750,000 of this size with a view in San Clemente. It is unusual to raise the price even in the face of many offers, but it happens often to the price of the top offers.
I meant ocean view.
My wife an I stopped by to look at this property last weekend. We were initially excited to finally see a more realistically priced property. However after looking around we quickly came to the conclusion that that it actually wasn't even worth the reduced price. To us it had nothing to distinguish it from the many other mediocre properties that line the orange county coastline masquerading as something worth living in. Interestingly the realtor was nowhere to be found and the house was filled with neighbours walking in and out talking about what a "bargain" this house is.
Short sale? Why banks are not willing to accept short sale listed prices? There are houses/condos on market for long time under short sale, but banks are not willing to sell them as advertised short sale price. for example: 4 vinca, ladera ranch. Any insight regarding decisions on short sale prices?
Even more hilarious is the "dream" estate up the hill on the same street (850 Salvador).
The home was sold in 2005 for 1.795mm. It includes a huge lot and a tennis court with a great view. One of the biggest parcels on Salvador.
Today, you can buy it WITHOUT the tennis court, for the bargain price of 4.4mm. WTH?
It has NOT been drastically remodeled. How would I know? I walked thorugh that property in the 80s, and it is virtually unchanged from that time.
The local realtors like to act as if Salvador is the "street of dreams", by the way. Anyone who has lived here for 20 plus years knows that it is an inferior location to several other San Clemente neighborhoods.
I'm willing to bet that this one is going back to the bank, too - what with the wishing price and the all caps, come to the sellers rescue-type listing information, and the unpaid property tax bill.
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