Asking Price: $2,275,000

Purchase Price: $1,471,500

Purchase Date: 2/24/2005

Address: 35 Tall Hedge, Irvine, CA 92603

Beds: 4

Baths: 4.5

Sq. Ft.*: 2,825

Lot Sq. Ft.*: 6,300

Year Built: 2005

Stories: 2

Type: Single Family Residence

View: Catalina Island, City Lights, Ocean, Panoramic, Water, Other

Neighborhood: Turtle Ridge

$/Sq. Ft.*: $805

MLS: U7000721

Status: Active on market

On Redfin: 31 days

Craigslist, Zillow, Redfin

This one was bought two years ago, so it might be argued it isn’t really a flip, but when you believe your house has gone up in value 50% over the last two years (particularly the last two), you are certainly thinking like a flipper. This is a nice home full of the requisite pretentious accouterments one would expect in a Tuscan Villa / Irvine Tract Home. To quote Redfin:

“Tuscan style home in Turtle Ridge offers 4 bdrms. , 4.5 bths. , 3 car ga rage. This highly upgraded home has walnut hardwood floors, 6 crown molding, custom paint and travertine flooring in kitchen & baths. The chef s kitchen has upgraded appliances, granite countertops & walnut cabinets. Custom built balcony off master bdrm has endless city lights & ocean views of Catalina and Pales Verdes. The backyard includes a wood burning fireplace, outdoor B. BQ w/ travertine counter tops & fountain.”

{adsense}

It looks like there may be some disagreement in the market as to the value of this property. Zillow thinks the house is worth about $1,850,000. Of course, their neighbors at 25 Sylvan just sold for $2,150,000; I imagine these owners must believe their house is better.

However, it is a nearby house at 20 Highpoint that must have caught these people’s attention. 20 Highpoint was purchased on 4/7/2005 from the builder for $1,873,000. It was sold on 1/19/2007 for $2,800,000. Assuming a 6% commission (which is probably too high for an expensive home) these people made $759,000 in about 18 months! Could this be fraud? Zillow thinks the new owners overpaid by $400,000. When you map the comps, this one does seem like an outlier. In any case, there seems to be some activity with these pricey homes, so maybe our flippers will get lucky.

You know, I worked the last 18 months, and I did not make $759,000. I should flip houses.

Asking Price: $675,000

Purchase Price: $659,000

Purchase Date: 8/8/2005

Address: 19 Calabria, Irvine, CA 92620

Beds: 3

Baths: 2.5

Size: 1,547 sq. ft*

Housing: Residential

Year Built: 1982

MLS #: S479474

Craigslist, Redfin, Zillow.

As many of you know, Zillow has a feature called the “Make Me Move Price” where owners can provide asking prices that would get them to move out. To me it seems like a good place to look for “wishing prices” because that is exactly what they are. This flipper/seller must not have been very motivated when they first started because they went to Zillow and put in a Make Me Move Price of $725,000. The Zestimate is only $686,460. Obviously, the house didn’t sell.

Come forward in time, and our flipper is a bit more motivated. There is an add on Craigslist where it seems our flipper is just looking for someone to take over his payments, and he will walk. I don’t have the mortgage data, but I smell 100% financing, particularly when the add says, “Only $4,550/mo + tx & ins.” Want to guess what his payments are? ” Just four payments and closing costs moves you in.” Well, he isn’t so desperate if he wants $18,200 up front, or do you suspect he might be four payments behind on his mortgage?

NO BANK QUALIFYING, NO CREDIT APPLICATION!!!

Do you think he is offering owner financing? Is this an installment deal? Or is this just a fantasy?

I will give you my opinion, to quote Billy Joel:

It’s just a fantasy

It’s not the real thing

It’s just a fantasy

It’s not the real thing

But sometimes a fantasy

Is all you need

For as much as flippers annoy use because they drove prices up to such dizzying heights, in a healthy market, they do serve a legitimate function. When a property becomes distressed, a flipper can come in, perform the necessary repairs and make a buck or two. This rehabilitates our ailing housing stock and keeps our neighborhoods in good condition.

This house is at 4741 Lindstrom Ave., Irvine, CA 92604. The property is being offered on Craigslist for 647,000. See virtual tour video here. Zillow puts the zestimate at $782,126 (for whatever that is worth). A comparable property a few doors down just sold on 11/17/2006 for $732,000. The comp is smaller, but updated inside (it was listed as a rental just before the sale at $2,800 a month). The Craigslist ad says “Comps come in at $750,000–$775,000!” (again, for whatever that is worth). In a healthy market, a flipper would buy this property, and fix some of its problems.

This property is a mess, but it does not seem that bad off (I am not privy to any inspection info which might change my opinion). It is the kind of property that benefits from flipping. Anybody here want to put their own money and sweat equity into a property during a declining market? If so, follow the link, you might be cut out to be a flipper, and you might help rejuvinate an ailing property. Five years from now when a lot of our housing stock looks like this one, we will be begging the flippers to come back and fix up things; until then, I will enjoy watching their destruction as much as you do.

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Update: Check out the funny new Craigslist ad “$647000 call for showing and make urself some money reselling!”