4.25% Annual Appreciation - 90405 Entry Level Short Sale

Address: 2315 27th - 90405

Details: 2 bed/1 bath 1,315 sq ft house, 7,791 sq ft lot

Description: CHARMING SPANISH STYLE HOME. 2 BEDROOMS, 1 BATH. DETAILED ARCHWAYS, COZY FIREPLACE. LARGE PRIVATE YARD FOR ENTERTAINING.

Previous Purchase: 5/17/00 - $525,000

Refinanced with two WaMu loans: 9/8/06 - $1.146mm

Listing History (short sale): 2/1/10 - $825,000

SOLD: 4/25/11 - $825,000

This is an entry level house which doesn't appear to have been improved so it provides a nice apples to apples comparison. Going back 11 years to the sale in 2000 we see that this just sold for a price which provided a compound annual growth rate of 4.25%. That isn't a crazy level of appreciation in my opinion. I think that should show that we are a lot closer to a bottom than a top (duh!).

The fact that the owners refinanced themselves to death is interesting but just goes to show how crazy things were back near the peak. Out with the irresponsible and in with a new class of buyers.

90402 Location Discount Rollback

Address: 614 7th - 90402

Details: 3 bed/2 bath 1,254 sq ft house, 4,800 sq ft lot, "remodeled"

Description: Perfect Southern California Cottage. Fantastic Location ~. This remodeled house with guest house is set behind tall hedges offering complete privacy. The 3bed/2ba main house has dark hardwood floors, crown molding, skylights, vaulted ceilings, fireplace, recessed lighting, and a home security system. Very well lit and charming . Master bath features carrera marble sink and tub. The updated kitchen has a garden window, walk in pantry and custom tiled countertops. A brick patio/courtyard separates the main house from the guest house, and is perfect for al fresco dining. The 1 bed (w/cedar closets)/1 bath guest house has a family room and office and skylights. This is ideal for those who work from home or a great playroom for kids. This north of Montana home is walking distance to great shopping and restaurants, and moments away from the Santa Monica beaches and bike path.

Previous Purchase: 7/25/05 - $1,575,000

Listing History: 10/20/10 - $1,750,000
Reduced down to - $1,639,000


SOLD: 4/12/11 - $1,493,000


Location discount properties such as this showed weakness first and seemed to decline the most during the downturn. They certainly seem to be a little more weak in the current environment and this could be a leading indicator of overall weakness but there aren't a lot of data points and I'm not convinced there is a big overall decline ahead.

A Real 90402 Foreclosure

Address: 740 21st Place - 90402

Details: 4 bed/4 bath 2,913 sq ft house, 8,940 sq ft lot, foreclosure

Description: Gorgeous Spanish style 4 bd/4 ba home. Windows throughout create light & bright feel.Gated property w/ detached 2 car garage.Lush landscaped front yrd w/fountain & vine laced porch.LR w/high ceilings & fireplace. Hrdwd flrs throughout.Kitchen w/breakfast nook, recessed lighting, dishwasher, stove, & custom cabinets.Laundry rm w/side exit & storage.A downstairs bdrm has private bathrm & separate entry, could be used as an office. Lrg family rm w/bar, mini refrigerator, speaker system, & french doors that lead out to a covered patio.Backyard has salt water pool & spa w/ automated pool cover.Upstairs bdrm is very lrg w/ pvt bath. Massive master bdrm w/ pvt bath & lrg walk-in closet. Info herein is not verified by agent. Buyer to verify all info & rely on their findings.Offers must be submitted on CAR form w/pre-approval (NOT pre-qual), copy of earnest money check, proof of funds & agency disclosure. For guarantee receipt of your offer check private remarks for submission instructions.

Previous Purchase: 4/21/04 - $2,180,000

REO Listing History: 4/22/11 - $2,299,900

I last featured this house back in July 2009 when I had noticed that RealtyTrac showed it was going to auction.

I'm not sure what ever happened and Property Shark doesn't show that the bank took it back (maybe their records are slow to be updated). But this property is now listed on the market as a foreclosure so we have to assume the bank is in control now.

The photos don't appear to show any major problems and given the price they are asking, I think this will generate a good amount of attention and likely sell near or above list price. Still interesting to see an actual foreclosure in a proper 90402 location since there haven't been many.

Owner Related To Agent *Updated*

Address: 1212 Hill - 90405

Details: 3 bed/2 bath 1,316 sq ft house, 6,950 sq ft lot

Description: Warm and charming, bright, Sunset Park home in move-in condition. Hardwood floors, new A.C. and heating system. Living room with wood burning fireplace and recessed lights. Vintage kitchen features O'Keefe + Merritt stove + overlooks huge lush backyard and one of two decks. Master suite with remodeled bath, separate spa tub and shower. French doors leading out to large, sunny and romantic deck. Gorgeous backyard ideal for entertaining. Tankless water heater, security system. Garage and storage space under house. Professionally landscaped yard, automated sprinklers. Inside laundry room. Great location close to parks, beach, shopping and Main street.


Previous Purchase: 12/20/05 - $1,182,000


Listing History: 4/4/11 - $1,249,000
Reduced a week later to - $1,199,000


This house looks like it could be nice enough and the location looks to be alright. However, after looking at the pictures I think it is a little odd that the master bath has been redone but the other bath appears to be more original and the kitchen looks really uninspiring (vintage = old). At this price point, you would think the upgrades would have been done throughout the house.


The question here is how much of the upgrading was done after the previous purchase. If it is little then this asking point looks pretty high. I also think the problem here is that the house is just 1,300 sq ft. 3 bedrooms? Must be small rooms. Agent related to owner, buyer beware.

How Rich Is Frank Gehry??!!

Back in August 2009 I featured 2112 Washington which was a remodeled small house and guest house on a 4,150 sq ft lot. It went into escrow after just a few days on market and sold at a price that nobody could justify as anywhere near "market".

Go back and read the comments from the old post I did. Pretty funny. But buried down in the comments was the following nugget:

I know the owners of this house well. They knew that Frank Gehry really wanted the house and they thus priced it at a substantial premium to market. Gehry tried to talk them down, but they held firm. In the end Gehry capitulated and paid what he paid. Gehry really needed the land in order to expand.


So here we are a year and a half later...

If you walk by and peer through the screen in one area you can see the building permit and Frank Gehry's name is listed right in the open. So he is definitely the one that bought the "remodeled" house for well above market value and he has now demolished the whole thing. So he paid $1.375mm for 4,150 sq ft of dirt. Baller. Guy doesn't give a damn about what all the other jokers out there (including myself) thought this thing might have been worth. He just wrote a fat check so that he can have another 4k sq ft of land to play with.

Kudos to the seller for being smart enough to price it well above market knowing that they would get paid off. Makes you wonder if they could have priced it even higher!

Money is a great tool. Gehry obviously has lots of it. So kudos to him as well for knowing and getting what he wants with just a quick stroke of the pen. I think everyone here won...except for a nice family that might have wanted to live in that house; but hey, that's how markets work.