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Friday, November 7th, 2008 at 6:20 PM

End-Of-Year Closeouts

We’ve wondered if the banks will be forced to blow out some REOs at bargain prices to clean up the books before year end. If so, could it be an opportunity for investors to pick up some decent rental properties?

A great place to find them would be in the northeast area of Oceanside, in the 92057 zip code. There we’ve seen hundreds of foreclosures contributing to a steep slide in prices, and investors have been competing with owner-occupiers. In the last six months there have been 48 detached SFRs listed under $200,000 that have sold, and they have been hot – 31 of them closed at, or above, list price.

Indeed, there haven’t been many houses given away – will there be some steals between now and December 31st?

I listed one today that will be a good one to judge how the demand is holding up. The seller, Countrywide (on behalf of the Bank of New York), not only put an attractive price on it, they followed my advice and spent $6,500 to improve the property BEFORE putting it on the market. Towards the end of the foreclosure era in the mid-1990s, the lenders did the same thing – investing money to improve the properties to assist in the sale.

Will the demand hold up, and/or will the over-supply of REOs cause lenders to cave on price over the next 30-45 days?

Let’s use this house as a marker!

The address is 5079 Gold Drive, and it’s a 4br/2ba, 1,352sf house built in 1974 on a 8,900sf lot. With a 20% down payment it’ll produce positive cash flow from day one if you rent it for $1,300 to $1,400 per month. The list price is $184,900 – what will it sell for?

Here’s a short (1:58) YouTube video tour:

Posted on Friday, November 7th, 2008 at 6:20 PM in Foreclosures/REOs | 3 Comments » | Print Print You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Reader Comments: 3 Responses

  1. Did I hear “lie down view”? Ha-ha funny.

    no_techie | November 7th, 2008 at 10:18 pm

  2. Jim, here’s an REO that we originally discovered on your listings.

    The bizarre story of Casa Simpatica in Olivenhain.

    You are welcome to reprint what I’ve found, and if anyone has any more juicy details, I’d love to hear them.

    W.C. Varones | November 8th, 2008 at 8:50 am

  3. W.C.,

    Looks like you’ve covered it pretty well.

    That is a fascinating story, and we’ve been following it for a few years. As you probably know, it was a “green” house, and constructed of foam panels. My husband has been in the house and says it really is quite beautiful and has many “Old World” architectural details.

    It’s sad, IMHO. She’s definitely eccentric and intelligent, and her ideas are interesting. I don’t think she was looking to get rich (she was rich, from what I could tell), but she really wanted to make a difference and help people in a non-traditional way (at least that’s what I heard/read over the years).

    Around the time gay marriage was made legal in California, she was trying to hawk the place as a location for weddings and honeymoons/marriage retreats, IIRC.

    This house could really be an interesting purchase for the right person.

    CA renter | November 8th, 2008 at 3:49 pm

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