Houses under $200,000 are blowing off the market, usually with multiple offers. This one closed yesterday, a 3br/1.5ba, 1,062sf house built in 1961 in virtually original condition, whose elderly owner just went off to assisted living:
The buyer of this house, an Arizonan, said,
“Where I come from all the slabs are cracked, even the ones on flat land”.
In the lower-end markets of Oceanside, it’s all about acquisition now, people just want to buy something, anything.
It’s addictive.
This is excellent news. I love hearing that the faithful, with hundreds of thousands in cash are buying the next round of price drops. I encourage this new owner to spend the money to fix slab (yeah right) and put this bad boy back on the market.
Who wants to bet this home will be back on market in 12-15 months for $110K?
You see, someone with $179K in cash isn’t going to live in this house. Which means someone thinks this is an investment opportunity.
Hilarious.
O-side, beat to hell house, hanging on a hillside over Mission, cracked slab. Oh yeah, this home is pure investor gold.
ice weasel: The buyer is going to repair the slab, put on a new roof, update the interior and occupy the home. Incidentally 2 of the 5 cash offers were from owner/occupants. Mr. T.
For that kind of money, I rather buy couple condos and avoid the hassles of maintaining this old crappy houses. This reminds me of the last RE run-ups and how soon some people forget….
That slab s not “repairable. Jim called it in the video. This house’s back is broke. Scrape, regrade, recomapact and repour is the only way to fix this. For the record, my primary residence had a far worse appearing crack problem when I bought it but I’m a structural engineer and knew how to fix it.
This one however; Where’s the value?
Cracked slabs are not the only crack being sold in hoods like this. I just had the pleasure of my son playing a baseball game at Landes Park on the Oside/West Vista border. 5:00 pm game on a drizzly damp dark eve…May Grey as we all know it here. Glad it wasn’t a night game as I’m certain that the streets get a little tougher and the park crowd a little nastier after sunset.
I’m with Ice Weasel on this one.
If you are sitting on $170K cash, and that’s the house and neighborhood you want to live in – all the power to you.
I just don’t see it, and it sure reeks of ‘investor’. Maybe not a flipper, but someone who will fix it/live in it “until the market returns”.
Don’t be prejudiced about someone with $170K cash. Some people just think mortgages are evil and want to own their home outright. If that’s your mentailty, these neighborhoods in O’side are one of the few areas where you can accomplish it. However, I do agree that someone who has amassed that amount should be a bit smarter about how to buy a house at a discount rather than getting in a bidding war.
$100K… maybe, but one strong earthquake and adios.
How does one go about fixing a cracked slab and at what cost?
“How does one go about fixing a cracked slab and at what cost?”
Myriad: As a general property adjuster for over 20 years in San Diego who was at the forefront of the land subsidence claims, the answer to the 2nd part of this question is “a bunch.”
As for the first part, slabs don’t just get old and crack, it’s the soils supporting the slabs which fail. Saw cutting and pouring new concrete does nothing to “repair” the faulty soils supporting the structure.
A decent soils test (borings/manonmeters/lab work) would run about 10K and it would recommend ethier compaction grouting, pipe piles or grade beams or some combination to “properly” fix the house.
My guess, with engineering, about 75-80 K.
Oh, cosmetic repairs would be extra.
A buddy of mine had to do what you described Downturn and it did cost 100k to properly fix the problem but it was a much larger house. At 149k it would have been a break even for the comparable house up the street without the hassle or adjacent road. The banks are doing a great job of dribbling this crap out at just the right time. Maybe this guy can tear it down and just put a yurt on it to live in.
That is not a crack, that is a gaping chasm that you could lose a small dog in. But the rest of the house looks great…
Seriously? Someone with $170K in cash wants to live there? Well then, as another contributor said, more power to them. I know if I had $170K in cash that would not be the home I would put an offer, the neighborhood I would looking or even the city I would prioritize. I get that some people want to pay cash for a home. I have no problem with that whatsoever. I just doubt, in the extreme, anyone with that much cash on hand has the poor judgment it takes to actually want to live in that home.
But as I said, best of luck to the “homeowner”.
And I still maintain, as several other contributors have pointed out that yeah, sure, they’re going to “fix” the cracked slab.
I did notice that no one wanted to take that bet.
Thanks for the info Downturn
Money Laundering?
So, Downturn says it’d run the better part of $100K just to “fix” this 1Ksf shack’s foundation even before renovations began. Anyone care to venture how much it’d cost just to TD it and build entirely new (assuming same basic outcome)? Just curious…
p.s.: Downturn, how long would the “fix” take?
The most common way an investor lies on his loan is to call it owner occupied. It’s a parallel to owner occupied loans lying about their income.
We need to track this property. I bet it records with a private party note of about 100k.
30k for the “quick fix” foundation, new roof,paint, etc. and a family friend or relative occupies for 1 year for coverage on the note and to qualify for LT capital gain.
When they resale(attempt to flip) I bet they do not disclose the cracks,take those great wide angle pics, make sure the front yard has new squares, and hope that they can find someone with FHA approval and 8k DP credit advanced.
No disrespect to Mr T, but “we are no fools…..fool.
I welcome all these people jumping into the market to buy homes now, it means less competition for me when I decide to buy. Future demand will be even lower, as the buying pool will be much smaller, thus leading to even more price drops. Add in the big wave of foreclosures coming our way, California’s rapidly intensifying economic deterioation, and the potential of future higher interest rates, and price drops could be more than even the most pessimistic of us predict.
Money Laundering?
BottomFisher | May 30th, 2009 at 4:56 pm
———————
Been wondering about that myself. There have been a number of very strange sales, where homes that were sitting for a long time and price decreases are suddenly taken off the market (or the price is suddenly adjusted upward) and then re-listed with a higher price…then then sell for more than they were originally listed for. This is also going on in the higher-end neighborhoods like Del Mar, Solana Beach, La Jolla, etc.
As to the “all cash” offers, if it’s not money laundering, it might also be hard money loans. I’ve been hearing that there are quite a few hard money loans and/or investment pools behind these “all cash” offers. It’s not necessarily a buyer who has saved up/earned a large amount and they now want to buy a home in O’side for cash.
Let all the early adopters buy up the impaired houses. The longer the decline continues the nicer the houses that will be forced onto the market. By that time the competition will be struggling for a second round.
Furniture shops can’t justify business so money laundering needs to move into inexpensive homes.
CA Renter, strange sales like these may indicate double escrowing with the subsequent sale made with an unsuspecting, unsophisticated buyer’s money.
DR,
Yes, I’ve seen that, too (because you can see two different listings for the same properties, sometimes).
I think the ones we’re seeing are different, but who knows?
The good news is that law enforcement task forces at every level – local, state and fed are arresting mortgage fraud suspects in huge numbers…including individual buyers that lied (under penalty of perjury) on their loan applicatons. There is no slap on the wrist now- prison sentences are being handed down. Someone in my sphere is processing suspicious aps as we speak. However, I’m sure some new scam has or will erupt w/the $8k and $10K credits. Realtors need to be alert and report suspicious transacations.
Huge cracks! Maybe the house has a gypsy curse?
Thanks Desert Realtor.
You can sell me an ice cream cone anytime!