We have a sale to report. 111 Tall Oak was asking $659,000 in the summer finally sold for $590,000. The unit was purchased on 3/6/2006 for $725,000. That is 18.6% loss in less than 2 years not including commissions. Basically, the second mortgage was a complete loss.
It looks as if our seller at 111 Tall Oak gave up trying, but the REO at 113 Tall Oak doesn’t have that luxury. When these properties were first profiled on July 30, 2007, the property at 113 Tall Oak was asking $689,000 — a wishing price. Now they are asking $579,000, and it still hasn’t sold. That is a $110K reduction in asking price (almost 20%) in about 100 days. The property was purchased by an FB on 3/6/2006 for $725,000.
Talk about a comp killer…
“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way…”
A Tale of Two Cities — Charles Dickens
Does this quote from A Tale of Two Cities resonate today? The two properties I am featuring today illustrate this dichotomy. First we have a distressed homeowner about to lose a lot of money and thinks it is the worst of times, and his next door neighbor is a knife-catching flipper who thinks the market is going strong and we are returning to the best of times. It is the age of wisdom and it is the age of foolishness — depending on what happens next.
Asking Price: $659,000
Purchase Price: $723,000
Purchase Date: 3/9/2006
Address: 111 Tall Oak, Irvine, CA 92603
1st Loan $578,400
2nd Mtg. $144,600
Downpayment $0
Beds: 3
Baths: 3.5
Sq. Ft.: 1,607
$/Sq. Ft.: $410
Lot Size: –
Year Built: 2004
Stories: 3
Type: Condominium
County: Orange
Neighborhood: Quail Hill
MLS#: S485520
Status: Active
On Redfin: 92 days
Unsold in 90+ days
From Redfin, “SpleSplended DETACHED – 2 YR old Villa in Quail Hill. ULTRA-HIP Floorp lan for 21st Century-3BR/3.5BA+Tech Desk. Granite Counter-Tops, Shutters, Berber Carpet, Wood flooring, Stainless Appliances, Courtyard location. 5-Star resort amenities w/ pools, sport court, tot lots, tennis, fitness gym, several parks+walking trails. Next to Spectrum, Retail Plaza already opend, Walk to Top-Tier Alderwood school. UNI-HIGH School. This is a pre-foreclosure sale! Sale subject to lender approval.”
What makes a floorplan ULTRA-HIP?
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Over 90 days on the market with no sale at this drastically reduced price. Where are the multiple offers over the asking price?
If the short sale is approved, the bank stands to lose $103,540 after a 6% commission. Since this is a 100% financing deal, The seller will undoubtedly try to simply walk away. My guess is the bank will probably approve a sale down to the total loss of the second mortgage, but they won’t take a hit on their first. That is pure speculation, and I could be wrong.
I suspect the flipper who purchased this neighboring property was not counting on 111 Tall Oak becoming a distressed , pre-foreclosure right after he purchased 113 Tall Oak as a flip. Such is life…
Old Asking Price: $689,000
New Asking Price: $579,900
Purchase Price: $603,000
Purchase Date: 3/6/2007
Address: 113 Tall Oak, Irvine, CA 92603
Beds: 3
Baths: 3.5
Sq. Ft.: 1,610
$/Sq. Ft.: $428
Lot Size: –
Year Built: 2004
Stories: 3
Type: Condominium
County: Orange
Neighborhood: Quail Hill
MLS#: S486686
Status: Active
On Redfin: 85 days
From Redfin, “* * * PRICE REDUCTION * * * A chance to own a detached home in the prestigious Quail Hill community with it’s resort style amenities to enjoy!! This tri level home boasts a modern floorplan which is functional and comfortable. Repairs are scheduled to begin soon and will include new paint, carpet and stair repair. This home features 2 balconies, plantation shutters, a romantic two-sided fireplace, and a computer niche. .. .. don’t miss out!!”
This realtor only uses two exclamation points. I guess he is trying to restrain his enthusiasm. * * * PRICE REDUCTION * * * Is our flipper losing confidence in the market? After watching your neighbor languish on the market for 90 days at a lower price, I probably would.
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If this flipper gets the asking price, he stands to make $44,660 after a 6% commission. Not bad for doing absolutely nothing (You can see from the pictures the property was not renovated.) Of course, when your own purchase and that of your neighboring property establish the market in the low $600,000s, It is going to be a difficult sell at the asking price.
This flip was purchased during the Spring of Hope, will it end in the Winter of Despair?
Unsold in 90+ days
