Small Rollback

Address: 2920 17th - 90405

Details: 3 bed/1.5 bath 1,569 sq ft house on a 6,656 sq ft lot

Description: A Sunset park sweetie: This home combines both period details and modern styling in one of the finest Santa Monica locations. Perched on a knoll with an extra wide lot, there is a sense of privacy rarely found. The living room opens to the back yard for an indoor-outdoor feeling, unusually beautiful granite counter tops enhance the large kitchen, the formal dining room is exceptionally spacious, and each bedroom is over sized and bright. The back yard is green, tree lined, private and has a wooden patio off the kitchen for dining, a porch off living room for relaxing and yet a 3rd seating area in the garden for lounging. Many upgrades including new furnace and duct work, double paned windows and drought resistant landscaping, the list goes on.


Previous Purchase: 10/4/07 - $1,325,000

Listing History: 5/17/12 - $1,238,000

The current asking price is just about 6.5% less than the 2007 price. However, this is not a completely apples to apples situation. The kitchen work was previously done but since the 2007 sale, the current owners put in new windows, opened up a wall to allow for better backyard access, painted, etc. Not terribly huge upgrades but costs add up. Ultimately, I expect this house to sell for near or maybe even above asking as it is move in ready and has a fair amount of charm. I don't love the fact that it is on 17th and I suspect that area gets some rush hour traffic but I can't say if it is too obscene. You will however get airport noise...Nonetheless, those hoping for continued big declines in prices will once again be proven wrong after this closes. It is already in escrow after just 12 days on market.

Gambling With a Tough Location

Address: 2302 Hill - 90405

Details: 4 bed/4 bath 3,252 sq ft house on a 8,260 sq ft lot, "re-built"

Description: Exceptional 2-story 4BR/4BA approx 3300 SF home re-built in 2012 w/quality finishes & expert craftsmanship. Sited on a gracious oversized corner lot. Featuring a contemporary open floor plan w/two on-suite master BR's, one on main level. Well designed w/high ceilings, 8ft doors, natural wood floors & tons of natural light. State-of-the-art kitchen w/traditional white cabinetry, top-of-the line stainless steel appliances, 6-burner commercial grade stove, full sized sub-zero, built-in microwave, center island & breakfast bar. Dining area sits conveniently off kitchen. Kitchen opens to family RM with LG windows spaced through-out. French doors take you to backyard creating a seamless indoor/outdoor flow. Enter top-level sophisticated master suite through dramatic staircase & watch the sunset from your master retreat. Master BA w/soak in tub, walk-in-closet & his&hers vanity. Ample storage, separate pantry, wired for TV & computer, smart wired & plumbed. Great Schools & more! A MUST SEE!


History: Listed in March 2009 for $949k and then reduced down to $859k before expiring


Listed a year later in March 2010 for $849k


SOLD: 5/14/10 - $770,000


Re-Built Listing: 3/12/12 - $1,990,000

The old house was a crappy 966 sq ft thing that needed a lot of work. After a failed listing in 2009, the sellers cut $100k off the asking price and ended up accepting a $770k bid. The description says the current property was "re-built" so I don't think this is full on new construction but its not too far off given that it was a very heavy remodel with a lot of square footage added.

The big wild card here is the location. 23rd can get very busy as it is a major commuter pathway. Then to make it worse, you are just a few blocks from the end of the airport runway. This is why the developers were able to buy the old house so "cheap" despite the fact that it is on a somewhat larger, corner lot.

So I don't know what to say. I think most people would not want to even consider a place like this given the location. However, if you don't mind lots of cars and airplanes, then this would be an opportunity to buy a really nice place on the cheap (well, relatively speaking). Either way, the current price is obviously too high as there have been no takers after 77 days on market. The sellers have yet to cut the price which is a major mistake. The market is pretty firm these days. No takers and no price cuts after 77 days means this thing is in major zombie territory until the sellers want to get real. Price cuts and/or "available for lease" are almost certainly coming.

So Stubborn...Enjoying Those Holding Costs? *Update 3*

I last featured 2619 Washington back in early May.

Despite the fact that this house has been listed multiple times in the past, the current listing was at a lower price and the market feels better now than it has in the past. This led me to guess that the house would sell "close to asking but maybe a little below".

Current Listing: 3/15/12 - $1,795,000

SOLD: 5/18/12 - $1,755,000

It is refreshing to see houses like this finally sell. Clearing out this type of inventory is healthy for the market. The sellers were stubborn and kept listing too high and weren't willing to accept lower bids. Finally, people came to their senses and a fair transaction took place.

Stable Values Illustrated

Address: 938 18th #5 - 90403

Details: 2 bed/2.5 bath 1,289 sq ft condo, 1981 building

Description: Fabulous move-in condition townhouse close to Montana Ave. shops and restaurants 2-bedrooms, 2.5-baths. Main level features living room and dining with hardwood floors, fireplace & powder room. Remodeled kitchen has granite counters, newer stainless appliances + separate Breakfast Area. Private patio area off the kitchen would be great for a BBQ. Direct access to two gated, side-by-side parking. 2nd Level has a large master suite w/vaulted ceilings, and is very light and bright. Updated bath with lots of natural light. 2nd bedroom is also sunny and has a walk-in closet. Central Heat and A/C. Small 7-Unit Bldg. Laundry in Unit. Controlled Access Bldg. This is a great Unit at a great price. 


Listing History: 3/1/12 - $649,000


SOLD: 4/27/12 - $670,000


I was randomly looking at a few recently closed condo transactions and I was lucky enough to stumble onto this sale. I think it gives a great look at the market because another unit in the same building with identical specs sold last year. Hey, a pretty good apples to apples comp situation!


The comp is Unit #3 which sold for $635,000 on 7/29/11 after having been on the market for 95 days and having a reduced price. Compare this to Unit #5 which just sold after just 15 days on market for $21k MORE than asking.


But is unit #3 really that similar? Same building, same bed/bath combo, same square footage, and here is the description: Move-in Condition Townhouse close to Montana Ave. 2-Bedrooms, 2.5-Baths, plus a Breakfast Area. Main level feautures Living Room and Dining area, Fireplace & Powder Room. Kitchen has Newer Stainless Appliances + separate Breakfast Area. Small Private Patio area off kitchen, great for a BBQ and Direct Access to Gated, Side-by-Side Parking. 2nd Level has a Large Master Suite w/Vaulted Ceilings, that is very light and bright. Updated bath with Double Marble sinks & lots of natural light. 2nd bedroom is also sunny and has a walk-in closet. Central Heat and A/C. Small 7-Unit Blvd. Laundry in Unit.Controlled Access Bldg. Brand New Paint and Carpet. Easy to Show. This is a Terrific Unit.


So both units have some upgrades to the kitchen and baths. I can't say for sure they are exactly comparable but I think they are probably pretty similar. So last year you saw a much longer DOM and eventual sale below list (although list was too high to begin with), and this year you have a quick sale over list for a materially higher price.


Looking at this example reminds me of my rent vs. own analysis which I did on a hypothetical $650k condo. You can see that here. The net apples to apples cost of owning came out to around $3k on a conservative assumption set. Hey, I bet this place could rent for nearly that much! Rental values supporting values...refreshing. This is why I think it is so funny (or sad maybe) that people sit on the internet spewing garbage about how the world is going to end and property values are going to collapse. For prices to come down much more you would need to see a big decline in rents. The future is always uncertain, but I think it is pretty likely that rents hold in (and increase over time).

Motor Avenue - Culver City

Address: 4396 Motor - 90232

Details: 3 bed/2 bath 1,664 sq ft house on a 6,619 sq ft lot

Description: This is the home you have been waiting for! Mid Century 3 bedroom, 2 bath plus family room with fireplace in the coveted Carlson Park area of Culver City. This property features an open floor plan, hardwood floors, huge yard with new deck that is accessed via the family room or master bedroom and is perfect for al fresco entertainment. Minutes away from downtown Culver City restaurants, shops and theater. This one is a winner!


Purchase History:
5/1/07 - $869,000
6/28/11 - $799,000


Listing History: 5/9/12 - $859,000


The best comp for this house is probably the recently closed sale on 5/11/12 for 4130 Motor. 4130 Motor sold for $813,000 and was pretty close to Culver Blvd (location discount) as well as the Backstage bar (further location discount, although I like the bar). Additionally, 4130 Motor wasn't as nice as this property appears. So given those facts, I think the price on this house doesn't look crazy.


However, the previous sale history is interesting to look at. The sale less than a year ago for $799k was a short sale. I actually wanted to look at this house when that listing hit the market but there was some kind of lock up that the tenant had on it so nothing panned out. Maybe they did get a great deal then. But why sell now? After transaction costs it isn't much of a gain. But either way, if this sells for near asking then it shows that prices aren't down much in this area as this would be close to the mid 2007 price.


The house itself looks fine as a modest started home, and the location is pretty solid. This is a very nice (and pricey) part of Culver City. I don't care for the trees on this block (obviously) but whatever. There hasn't been much quality inventory in this area, so I would expect this listing to generate a decent amount of interest.

If you lived in this area, then you could have walked to the car show in downtown Culver City as I did today. Lots of neat cars there. You can see the Culver hotel in the background.

Ashland Bids-A-Plenty *Update 1*

I last featured 2333 Ashland back in February as I was illustrating the strength of the entry level and mid level market tiers.

Listing History: 2/9/12 - $1,195,000

SOLD: 4/17/12 - $1,200,000

The interior looks nice but as I said before, the proximity to the airport is not for me. Alas, the honeybadger buyers of today don't care.

Another Bear Retreats

Calculated Risk recently highlighted this story and I thought I would pass it on. Mark Kiesel at Pimco just bought a house. He sold his previous house back in 2006 and rented up until now. His post has a lot of good graphs and statistics and I recommend people check it out.

For those of you renting or on the sidelines, I recommend you at least consider getting “back in” and buying a house in the U.S., particularly in an area of the country where supportive fundamentals and policies could cause inventories to fall and job growth to improve. The future is hard to predict, but U.S. housing is healing and is probably close to a bottom given reflationary policies are likely ahead, housing absolute and relative valuations are now attractive and leading housing market indicators are picking up.


I think that myself and others who are saying we have basically bottomed are going to be right but we probably won't see big signs of gains for a while. This will mirror the way things worked when the bears called the top of the market but were generally early and had to watch as prices jiggled around before ultimately falling and proving the early bears right.


The point of this blog was always to help out others like myself who were looking at the market and wondering what would happen and when the right time to buy would be. My money is where my mouth is. I don't think there is anything wrong with renting or taking your time to buy something. But I think it is quite clear that the whole "rent and wait for the market to come down" game is over. You should no longer expect to benefit from that strategy. I'm now going to go drink Margaritas and think about how awesome it is to be paying down principal.

1030 Harvard Poll Results

<$1.32mm = 12%

$1.32-1.37mm = 12%

$1.37-1.42mm = 38%

$1.42mm or more = 36%

57 total votes. Thanks to those who voted. I will do an update when the sale closes (yes, I'm assuming it will sell).

So Stubborn...Enjoying Those Holding Costs? *Update 2*

I last featured 2619 Washington back in March. I said that I thought they were still asking too much but that they no doubt had a better shot of selling now. The house is now in escrow. I'm guessing it will sell close to asking but maybe a little below.

And for the rest of the negative nancies out there, 2418 Washington just went pending. Keep dreaming about price declines because they ain't coming.

The market is currently doing a great job of quickly absorbing new inventory. Demand seems to be firm and there isn't much supply.