Address: 8 Del Azul, Irvine, CA 92614 (Westpark)

Plan: 1139 sq ft – 2/2

MLS: R71271 DOM: 15

Sale History: 9/6/2005: $625,000

6/10/2004: $570,000

1/29/2002: $318,000

Prior Listing: 7/17/06 — $719,000 (33 DOM – MLS R67231) – Reduced to $684,000

Prior Listing: 8/19/06 — $683,900 (16 DOM – MLS R68644)

Prior Listing: 9/4/06 — $683,000 (16 DOM – MLS R69211)

Prior Listing: 9/20/06 — $683,000 (21 DOM – MLS R69875)

Prior Listing: 10/12/06 — $683,000 (15 DOM – MLS R70714) – Reduced to $667,000

Price Reduced: 11/09/06 — $667,000 to $645,000

Current Price: $645,000

I believe this is a detached 2bd/2ba SFR home in the Bogatta tract in Westpark. It’s hard to tell from the pictures whether it is detached or not but for the price, it better be! Anyone know who the builder was?

Here we’ve got another buyer that purchased near the peak in the fall of 2005. 10 months later and the property is back on the market. The relisting game is in high gear on this property. A buyer who comes across this property on Zip might think it’s been on the market for only 15 days, but when you add up all the DOMs for the expired listings, you’ll see that it’s been about 116 days!

The initial asking price of $719k would have netted the flipper about $50k. That hope disappeared pretty quickly as they had trouble luring a GF. It looks like the home went into escrow during the first listing but perhaps the buyers got skittish and the escrow fell through. After that, the strategy was to relist the home 4 MORE TIMES AT THE SAME PRICE OF $683,000! Now how does that make sense?

The current asking price of $645k is $74,000 lower than the initial asking price of $719k. An asking price of $645k back in July would have made a sale much more likely. They’ve just been chasing the market down for the last few months.

If sold at $645k, the seller will lose about $18,700 (after 6% in selling costs). The actual loss will be even higher because the property has been vacant since at least 7/17/2006. I was only able to find one loan on the property for 75% of the purchase price. The private remarks on the listings say that the seller is very motivated and is relocating. If these things are true, then lower the price and get rid of it!

One last interesting thing I’ve found is that the prior flipper (who bought on 6/10/2004 for $570k and sold on 9/6/2005 for $625k) purchased the home with 100% financing. This prior flipper made $17,500 (after 6% in selling costs) in 15 months using someone else’s money. The actual profit was probably less because they used it at a rental and almost all rentals purchased in Irvine in the last few years are cash negative. This prior flipper was lucky to have gotten out!

Address: 77 Canyoncrest, Irvine, CA 92603 (Turtle Ridge)

Plan: 1275 sq ft – 3/2.5

MLS: S460156 DOM: 47

Sale History: 5/27/2005: $759,000

Current Price: $829,000

Here we’ve got a Plan 3 detached condo in the Chantory tract built by California Pacific Homes in Turtle Ridge. It was purchased about a year and a half ago with 10% down. Assuming 6% selling costs, the sellers stand to make a $20k profit!

In this case, is the potential reward of $20k worth the risk? Don’t housing prices always go up? Who cares if you only plan on living in the house for a year or two. Don’t rent, just buy!

Anyways, let’s see what other Plan 3’s are currently available:

• 137 Canyoncrest – $769,000 (originally $795,000) – 95 DOM
• 82 Clouds View – $798,000 – 51 DOM

Address: 11 Remington, Irvine, CA 92620 (Northwood)

Plan: 1016 sq ft – 2/2.5

MLS: S459567 DOM: 49

Sale History: 1/31/2006: $440,000

4/22/1999: $160,000

Price Reduced: 10/04/06 — $445,000 to $434,900

Price Reduced: 10/10/06 — $434,900 to $424,900

Current Price: $424,900

This Plan E in the Horizons tract in Northwood was purchased at the end of January 2006 and placed back on the market about 8 months later. The flipper bought it with 100% financing and originally listed it just a tad higher than their purchase price. The reductions came pretty quick initially and now the this seller will definitely be under water. Check out the pictures! Unfortunately, it doesn’t look too appealing (at least to me). That will make it just that much harder to unload.

Since our flipper purchased this home with 100% financing, they will have to come up with a nice sum of money (over $40k assuming 6% selling costs) to get out of this property. Or maybe the lender will have to take the hit on this one.

Address: 108 Coral Rose, Irvine, CA 92603 (Turtle Ridge)

Plan: 1398 sq ft – 2/2.5

MLS: S445098 DOM: 150

Sale History: 3/31/2005: $619,990 ??

Price Reduced: 08/23/06 — $750,000 to $725,000

Price Reduced: 10/06/06 — $725,000 to $689,000

Price Reduced: 10/13/06 — $689,000 to $669,000

Price Reduced: 11/03/06 — $669,000 to $595,000

Current Price: $595,000

MLS Description: CONDO GIVEAWAY! THAT’S RIGHT $595,000. GORGEOUS MODEL HOME BY SHEA BUILDERS. 2 BD, 2.5 BA. ALL THE GOODIES AND HAS A VIEW. WAS PRICED AT $750,000, AT $669,000—-AND NOW YOU NAME THE PRICE!

This is a Plan 7 in the Ashton Green tract in the village of Turtle Ridge. So what’s going on here? Your guess is as good as mine! Let me tell you what I’ve found so far:

• No prior sales history in Zillow or the Title database
• The last plan 7 (actually a 7A which had 1426 sq ft) sold for $815,000 on 5/24/2006 – an all time high for this tract
• Property taxes are listed as UNPAID
• Title lists the owner as “SHEA HOMES LTD PARTNERSHIP” and thus no loan information

I actually found an old listing in MLS (P422498) that shows the property listed by Shea Homes and sold to a buyer for $619,990 on 3/31/2005. The agent representing the buyer in that transaction is the same agent that is listing the property now. **IF** we assume the MLS info for the purchase is correct, then this flipper will lose $60,690 (assuming 6% in selling costs) if they sell at $595,000! They are selling for LESS than what they bought the property for FROM THE BUILDER!

Could Shea possibly still own this home or is the title information just not accurate? Is the seller in default? Why are the prior year’s taxes still unpaid? Is the ‘low’ price an attempt to generate offers after probably receiving none for the last 5 months?

Address: 20 Avanzare, Irvine, CA 92606 (Westpark)
Plan: 1876 sq ft – 4/2.5
MLS: S452340 DOM: 80
Sale History: 6/03/2005: $753,000
7/30/1999: $343,000
10/30/1996: $228,000
Price Reduced: 08/26/06 — $795,000 to $775,000
Price Reduced: 10/05/06 — $775,000 to $759,900
Current Price: $759,000

This Plan 3 in the Trovata tract built by K Hovnanian was purchased with 10% down last summer for $753k. The price has been reduced a couple times and now the asking price is almost the same as the purchase price from over a year ago. It looks like a nice, clean, well kept home and 4 bedrooms at this price sounds pretty competitive. Any Westpark residents care to chime in? After 6% in selling costs, this seller will lose over $40,000 when all is said and done. That doesn’t even take into account the carrying costs of this vacant home which could be pretty substantial depending upon how long it’s been empty.

A quick look in the neighborhood reveals an identical Plan 3 for sale at 731 Paseo Westpark:

Address: 731 Paseo Westpark, Irvine, CA 92606 (Westpark)
Plan: 1876 sq ft – 4/2.5
MLS: P525054 DOM: 101
Sale History: 10/01/2001: $415,000
Price Reduced: 08/15/06 — $825,000 to $789,000
Price Reduced: 09/02/06 — $789,000 to $770,000
Price Reduced: 09/26/06 — $770,000 to $759,000
Current Price: $759,000

The private remarks for 731 Paseo Westpark say ‘VERY MOTIVATED SELLERS. MAKE AN OFFER!’. It’ll be interesting to see how this plays out with both plan 3’s priced exactly the same.

UPDATE #1 – November 4, 2006

Our non flipper at 731 Paseo Westpark made the first move by lowering their price on November 1 to $742,500. Now we wait and see if our flipper at 20 Avanzare chases the market down.