This video was shot in mid-April about a red-hot 2,724sf Carmel Valley listing, priced at $765,000.
The agent had a ton of interest, and raised the price twice, first to $778,000 and then to $798,000, and he had three offers over $800,000 immediately.
End result?
The bank foreclosed last week. Their opening bid? $724,956, but no takers.
$400k
red-hot 2,724sf Carmel Valley listing, priced at $765,000.
The agent had a ton of interest, and raised the price twice, first to $778,000 and then to $798,000, and he had three offers over $800,000 immediately.
With a final result of foreclosure, I wonder if that claimed interest was real. I wonder if it was an unscrupulous agent, trying to apply techniques that worked during the bubble days, to drive the price upwards. Banks opening bids are often greater to or equal to the outstanding on the loans, though that may be changing now.
I wonder if in high priced neighborhoods buyer’s agents are reluctant to show their clients short sales and/or foreclosures. Instead pushing clients to houses that are easier deals to close. Don’t have any evidence, just a guess.
Since it was a short sale, there could also have been issues with the bank.
An “offer” is not the same as a “qualified offer” no matter what the amount offered is.
I have a feeling that some house buyers are so drunk on the cool aid that even in a declining market they’re willing to pay anything just to get in, qualified or not.
Perhaps a 10% discount at the courthouse just wasn’t enought ot overcome concerns about title issues and the need to have cash on the barrelhead. That’s a lot of cash!
Investors are focusing on the lower end/penciled out deals. CV is still overpriced and they also know there are a ton of foreclosure coming. With $725K cash, they would rather have 3 Mira Mesa houses that pencil out.
Yes, putting up that much cash is difficult/risky even for people that buy at auction for a living.
Its different this time.
got me. keep us posted.
The foreclosing bank’s original loan amount was $666,500, so with back payments it might have gotten up to the opening bid of $724,956.
There was a second mortgage, and possibly a third noted on the tax rolls. I guess those lenders might have objected to the paltry low-$800,000 payout, but now they’re left with zip. Smart guys, if that’s what happened.
But the listing agent could have been the culprit. He was a bumbler, and could have sent in a lousy package and didn’t realize the urgency.
I think there may be more aggressive tactics being deployed by banks in foreclosing on the deadbeats today. I’ll have more on that in the following post.
This morning my husband was surmising that when the foreclosure have been mostly concluded, all those lenders who stepped aside on the 2nds and Helocs and who still have the right to pursue course of action, will do so. He thinks the planning is in place and a lot of people are going to be very surprised when they are sued and a judgement is rendered against them.
This one is curious, was it too complicated and the 2nd TD took it to the brink hoping the others would blink?
Or, maybe the bank knows they’ve got a nice property, let it foreclose and take it back to market after wiping out the 2nd & 3rd TD.
Maybe both, maybe some collusion with the bank, and maybe it’s just a bunch of clowns bring everybody down.
Sad situation seeing a family with small kids getting foreclosed on. Yes, I’m a bleeding heart.
It was tenant occupied, so it is not “a family with small kid getting foreclosed on”. It was someone else’s flop.
http://www.members.shaw.ca/gf3/circle-the-cat.html
No fair Jim.
Ok, if anyone wins that stinkin cat game let me know.
Erin- this might sound cocky, but, I cornered the cat 2nd try. First two clicks at opposite sides. Seriously.
Anonymous- thanks for clarifying. I love renters! Nothing like looking forward to the first of the month when you are a landlord.
Erin,
Have won it a couple times (although have tried many more). Most successful I’ve been is when driving the cat towards some of the already shaded areas. That helps you trap it.
Mozart:
That is true, only if your mortgage payment and tax payment is less than the renter’s check. As far as I know, most of accidental landlords in San Diego are still under water.
I don’t understand the landlord mentality, because I just put my money in a good REIT fund and get cash positive right from the moment.
At least, that is what I do with my $200K in O. I got $1400 a month every month, without the hassle.
Isn’t it the case that with recent legislation a foreclosed property makes it harder to kick out the tenants? It certainly would take longer.
Jim,
I think you hit the nail on the head!
“But the listing agent could have been the culprit. He was a bumbler, and could have sent in a lousy package and didn’t realize the urgency.”
I would guess 20% of agents REALLY know how to successfully complete a short sale.
Anonymous- good for you. I’m sure most renters are sticking with large stock market investments and making a killing.
Non traded, non leveraged RIETs are a much easier way to invest in real estate than being a land lord.
Excuse me for asking the obvious question… CA has ~11% official unemployment and effective unemployment approaching 20%. Taxes are about ready to shoot through the roof and the state itself might not last the summer. Oh, and to add insult to injury, rents in Southern CA are falling off a cliff… drastically recalcing the economics of these homes as investment properties.
A) Where are all the buyers coming from; and B) Where are they getting the money?
“I don’t understand the landlord mentality”
They usually want an easy way to make money. They find out tis not so..
One day we will look back at this another CA gold rush. But the mine is going dry real fast. It will take some people a lot longer than others to get it.
I also think that the people who are ‘working’ things out with a bank will be screwed over and very hard when the dust settles.
It will have been far better to go BK and start over than to save a depreciating asset who’s value depends on getting a job.
Non traded, non leveraged RIETs are a much easier way to invest in real estate than being a land lord.
It is a trust/control issue. I don’t trust 3rd parties with my money at this point. Do you really know what is held in your REIT and if the managers are acting in your best interest?
I have a good property manager and so it is pretty worry free, although not 100%.
RE: REITs.
Here is another suggestion and I think a much better one than property owning REITs, Buy a MBS REIT instead like HTS or NLY.
HTS pays 16% – much bigger div than O and takes LESS risk. All of its holdings are guaranteed by the US government. You are a virtual landlord with no credit risk and 100% occupancy. Buy on margin to get 24% or more effective yield. Write covered calls against your position to increase your yield even further.
But then California’s bond rating went to ‘D’ (following the recent downgrade to BBB), and general state services ceased, welfare programs were eliminated, and housing returned to ’91 prices.
Beat the cat first shot out of the bag. Oh well.
p.s.: Tyrone, ’91 was still near the previous bubble high. Homedebtors won’t be that lucky.
mozart:
Why would most of renters have a large investment in stock market ?
Why you think that I am a renter ? Do you must be either a landlord or renter ? How about just being a homeowner ? Why should you be a landlord in order to invest in RE ?
I think some landlords might like the feeling when they think they are higher class when they got their tenant’s check. If that “feeling” is what you want, good for you. For me, I want better return of my money.
‘91 was still near the previous bubble high
DOH!!
People. Are. Nuts.
People. Are. Nuts.
You. Are. Right.