Address: 837 18th #2 - 90403Details: 3 bed/3 bath 1,757 sq ft townhouse, 2005 construction, $280/month HOA
Description: Spectacular Santa Monica Condo ! - Newer construction, With Attached 2-car garage, 3 bedrooms, 3 baths, Beautiful open floorplan with great room and loft with spiral staircase, 3 balconies and patio, Partial Ocean and city views, This unit has Bamboo flooring upgraded baseboards, Custom 2-tone paint, a 3-way fireplace in the great room, central air and heat, walk-in closets, jetted tub in master. Kitchen has stainless appliances, Granite counters, gas cooktop and microwave. Plenty of windows and a Skylight for natural lighting. Gated, with secured parking and alarm system. Great location, approx 1.5 miles from the beach. This condo is move - in Ready and gorgeous.
Listing History: 11/14/09 - $1,075,000
Reduced down to - $995,000
SOLD: 2/5/10 - $925,000
This isn't far from being new construction, the location is great, and the buyer seemed to get a relatively good deal when looking at the location, age, and overall $/sq ft.
For a comparison to rental rates, I did a search on the blog and found someone left a comment saying that unit #4 from this building was asking $5,700/month as of June 2009.
If you actually put a proper down payment on this, you could get a pretty low mortgage rate right now. To err on the safe side, let's use 6% including all fees, etc and then let's tack on another 1% for property taxes. We come to about $5,400/month with another $300/month for HOA and we are at the rental rate. You obviously will be paying more than that when you include principal -- but I think using the interest+tax method is best when comparing to rent. I'm not giving any tax benefit to again err on the safe side and to account for immobility, etc when you buy.
You obviously need to figure out whether $5,700/month rent or near that level is actually attainable. I think closer to $5,000 is more realistic and there could be downside to that in the short term but I don't think you are going to rent a unit like this for $4,000...
This is a pretty unit, but I would not call it rental parity yet. The problem is that if you pay that much in rent, you usually end up in a house, not a condo. Since this is not as family friendly, it further limits the potential audience, and you need to discount for that. However, it does seem quite a bit down from peak, and the buyers have less of a potential downside than before....
ReplyDeleteFrom an investment perspective, an investor would pay approx. $700K at most for a property that generates $5,700/mo. in rent.
ReplyDeleteUnit 3 is also for sale at $949K (Short Sale), which may have driven down the price for this unit.
ReplyDeleteI cannot find a previous purchase price for either unit. Anyone have this? Tax data for each indicates about $1.2M value for each.
I looked at very similar but brand new condos on the same street within a block for rent in March asking $5700 but lowering to $5000 right off the bat.