Missing the market in Laguna Niguel

Today's property, located in Laguna Niguel, is a bit of an artifact. See, it's been for sale for well over a year.

And it's been chasing the market down all the way...

30442 La Vue, 92677
Asking price: $1,299,000
Asking price/ sq ft: $329
Income requirement: $324,750
Purchase price: $1,570,000
Purchase date: 8/17/05
Size: 4 beds, 4 baths, 3,954 sq ft (built in 1989)
MLS: S470041 (546 days on Redfin)
Zillow Zestimate: $1,598,500
HOA dues: $75
Type: Single Family Residence
Stories: 2 Levels
Lot size: 5,900 sq ft
From listing: Remodeled & Expanded, Nearly 4,000 sqft! Versatile Open floor plan. Tons of natural light. Two story Vaulted Ceiling entry. Huge Bonus room, Travertine floors, Granite counters, Stainless Steel Appliances, 3 Fire places. Salt Water Pool & Spa. Quiet neighborhood close to Beaches and World Class Resorts. Turnkey.


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Here's the asking price history, via Redfin:

Feb 03, 2007 $1,725,000
Feb 05, 2007 $1,675,000
May 23, 2007 $1,599,000
Aug 03, 2007 $1,559,000
Aug 15, 2007 $1,499,000
Sep 20, 2007 $1,449,000
Oct 06, 2007 $1,399,000
Feb 13, 2008 $1,349,000
Apr 03, 2008 $1,299,000

That's a decline of $426,000 over the course of more than a year. You can almost see the thinking in action: The property was first listed at a wishing price that would not only bail the owner out, but provide a little bit of profit too. Luxury real estate doesn't go down, right?

Then somewhere around the $1,559,000 mark we hit breakeven - this might have been the lowest amount the owner could take for the property and not have to either try for a short sale or pay the difference out of his own pocket.

But the market had already passed him by, and he kept chasing for many more months - always a step behind.

As of this writing, the property is showing up as active in Redfin but as inactive in other online brokerages like ZipRealty. This could simply mean the property is back on the market and hasn't been updated yet on other sites, or it could be that Redfin is simply incorrect. Either way, this property makes for an interesting subject.

It was purchased in 2005 using 90% financing - a $1 million first from Bank of America, and $411,500 from Grand Capital & Associates. In March of 2006 what appears to be a $55,000 standalone second was added to the property.

We should also mention the property is a preforeclosure. A notice of default was recorded on the first loan in December for $26,145. The notice of trustee sale amount of $1,046,958 was posted in April. If you'd like to pick this one up at auction, it's scheduled for the block July 25. Its original auction date was last Wednesday, but was postponed due to bankruptcy.

It appears unlikely, but if the property could somehow be sold for the current asking price on the open market, and we deduct 6% for sales costs, the loss would be $348,940.