Gotta Be Somebody — Nickelback
Cause nobody wants to be the last one there
It must be very difficult to sell a really undesirable property. It must be very difficult to admit to yourself that you are the bagholder. You were the greater fool. You were the one who paid a King’s Ransom for a piece of crap nobody else wants. This is even more difficult when it is a short sale, and the lender is not willing to lower the price enough for you to sell it. The reality of your folly must be hard to ignore when you can’t get rid of it.
Today’s featured property is a large home on a big lot in Irvine. One would think this combination would be an easy sell. Apparently it is not.
You have to love this realtor comment: “Needs some TLC such as carpet, paint (inside & out),remodeling, landscaping, etc., but very nice neighborhood.”
Translation, “OMG, this is a POS. Well, it is in Irvine…”
Asking Price: $599,900
Income Requirement: $149,975
Downpayment Needed: $119,980
Monthly Equity Burn: $5,000
Purchase Price: $760,000
Purchase Date: 5/13/2005
Address: 3671 Claremont St., Irvine, CA 92614
| Beds: | 5 |
| Baths: | 3 |
| Sq. Ft.: | 2,533 |
| $/Sq. Ft.: | $237 |
| Lot Size: | 5,100
Sq. Ft. |
| Property Type: | Single Family Residence |
| Style: | Contemporary |
| Year Built: | 1969 |
| Stories: | 2 |
| Area: | Westpark |
| County: | Orange |
| MLS#: | S528724 |
| Source: | SoCalMLS |
| Status: | Active |
| On Redfin: | 277 days |
 Unsold in 90+ days Fixer-upper
|
|
paint (inside & out),remodeling, landscaping, etc., but very nice
neighborhood.
So let me get this straight: This house is a trashed and needs to be completely done over inside and out. Before I can even begin, I have to spend $600,000. I will need a $120,000 downpayment, plus cash reserves, plus another $100,000 to fix the place up. When I am done, I will be out-of-pocket over $220,000 cash, I will have a $480,000 mortgage, and I will have a 40-year old property in Irvine that will be worth less than my mortgage in two years.
WHAT A DEAL!!!
The property records on this house are incomplete. There are a number of people listed as buyers who never took possession. It is difficult to ascertain what is going on or how much is owed. There is a recorded mortgage for $608,000 which may explain why the $600,000 price threshold has been so sticky with this seller. Check out this listing history:
| Date | Event | Price | Appreciation | Source |
|---|---|---|---|---|
| Jan 14, 2009 | Price Changed | $599,900 | — | SoCalMLS #S528724 |
| Jan 07, 2009 | Price Changed | $625,000 | — | SoCalMLS #S528724 |
| Jan 07, 2009 | Relisted | — | — | SoCalMLS #S528724 |
| Jan 07, 2009 | Off Redfin | — | — | SoCalMLS #S528724 |
| Oct 26, 2008 | Price Changed | $599,900 | — | SoCalMLS #S528724 |
| Oct 22, 2008 | Relisted | — | — | SoCalMLS #S528724 |
| Sep 23, 2008 | Price Changed | $597,500 | — | SoCalMLS #S528724 |
| Aug 05, 2008 | Price Changed | $610,000 | — | SoCalMLS #S528724 |
| Jul 01, 2008 | Price Changed | $629,900 | — | SoCalMLS #S528724 |
| Jul 01, 2008 | Relisted | — | — | SoCalMLS #S528724 |
| Jun 09, 2008 | Off Redfin | — | — | SoCalMLS #S528724 |
| Jun 03, 2008 | Relisted | — | — | SoCalMLS #S528724 |
| Apr 21, 2008 | Off Redfin | — | — | SoCalMLS #S528724 |
| Apr 13, 2008 | Listed | $670,000 | — | SoCalMLS #S528724 |
| May 13, 2005 | Sold | $760,000 | — | Public Records |
It is not clear whether or not this is a short sale. It may be that the $600,000 price is necessary to prevent a short sale. It appears as if the market is saying this isn’t low enough. Given this property’s state of repair, further price reductions are going to be necessary to sell it.
So let me hear some creative solutions to this problem: You have an undesirable property you need to sell, but you can’t reduce your price. If anyone can solve this dilemma, there are several million sellers out there waiting to hear from you…
I hope you have enjoyed this week at the Irvine Housing Blog. Come back next week as we
continue chronicling ‘the seventh circle of real estate hell.’ Have a great weekend.
🙂
{book}
This time, I wonder what it feels like
To find the one in this life, the one we all dream of
But dreams just aren’t enough
So I’ll be waiting for the real thing, I’ll know it by the feeling
The moment when we’re meeting, will play out like a scene
Straight off the silver screen
So I’ll be holding my own breath, right up ’til the end
Until that moment when, I find the one that I’ll spend forever with
Cause nobody wants to be the last one there
Cause everyone wants to feel like someone cares
Someone to love with my life in their hands
There’s gotta be somebody for me like that
Cause nobody wants to do it on their own
And everyone wants to know they’re not alone
There’s somebody else that feels the same somewhere
There’s gotta be somebody for me out there
Tonight, out on the street, out in the moonlight
And dammit this feels too right, it’s just like deja vu
Me standing here with you
So I’ll be holding my own breath, could this be the end
Is it that moment when, I find the one that I’ll spend forever with
Cause nobody wants to be the last one there
Cause everyone wants to feel like someone cares
Someone to love with my life in their hands
There’s gotta be somebody for me like that
Cause nobody wants to do it on their own
And everyone wants to know they’re not alone
There’s somebody else that feels the same somewhere
There’s gotta be somebody for me out there
Gotta Be Somebody — Nickelback
My “creative” solution involves a price drop. I guess that disqualifies me from winning…. 😉
This thing has been languishing for over 278 days, so it has not been priced well. I would think that if they offered it for slightly less than $200/SF – Say $199/sf – they might possibly attract a “value” investor. It would make the property stand out – more like Santa Ana prices, than Irvine prices.
Oh, and this is not actually IN the new part of “Westpark”. This is located in the previously-named “Culverdale” which is OLD. The photo says OLD.
It’s a fairly large home on a fairly large lot. This would be attractive for a fairly large family. However if said lot and home need massive makeovers in landscaping and carpet/paint – the size and scope of those projects become unattractive real quick.
As far as who all bought this property back in 2005 – probably a “group” of “investors” who were going to fix the place up and sell when it doubled. They were planning on replacing the carpet and repainting and doing a flip – that’s why it is mentioned in the MLS description. That’s my guess.
Still strange. Why didn’t they fix this place in 2005, when many still believed real estate could only go up???
Pray every night an airplane crashes into it and turns it into an inferno. Oh yea, make sure your not at home.
I think Irvine needs an old fashioned “Boston Tea Party” on housing. Get out your gas cans and lighters folks, were going to let places like this light the sky!
Would this be organized by the home debtors or bitter renters? Seems like a good way to keep Irvine prices high.
Well actually it will bring down the median prices since we’ll only be lighting up $1mil+ homes….hehe
I don’t think there are any bitter renters anymore, only grateful renters.
Fire!
Sale!
Back in the last big downturn here on the east coast you saw alot of houses like these picked up out of foreclosure by contractors. You aren’t seeing alot of people these days doing additions to their home so you have alot of contractors looking for work. Owner occupiers that can afford $500k-ish for a home can do better than this, and this is where the contractors come in. I don’t think prices are low enough to make the economics work but we know they will get there at some opint, and i think that is a type of buyer you will find for this type of property.
They could at least repaint inside. You can do several rooms if you do it yourself for less than $100, and that might help a little.
I agree. I mean, come on, how much time/effort/money does it take to do some basic things to make a place look better. Grab a paint can and some brushes, replace the old outlet and light switches, get some decent inexpensive carpet installed from Home Depot. Then list it as “new paint, new carpet, recent upgrades” and attract some of the many people who were scared way by the original description. I think today’s sellers (and agents) unwillingness to do some basic work on thier properties continues to amaze me.
Oh yes, dropping the price signifiantly might also help!
In Irvine’s plastic consumer world, it takes hundreds of thousands of dollars to fix this place up.
Does anyone remember what life was like before mass consumer credit?
I remember when I bought my house (many years ago!) it looked awful. Brown shag carpeting, ugly paint, no landscaping. But back then if you provided some beer and pizza to your buddies you could have a “painting party.” And through trial and error and some help from friends I was able to put in a lawn and sprinker system. I think reverting to the “do it yourself” mindset would be healthy for everyone. Mow your own lawn and save $100 per month. Have a potluck dinner with your frineds rather than going out to an expensive restaurant. Man, I am beginning to sound like my parents……
Chuck, it’s amazing how mass consumer credit changed our lives over the past 30 years. Due to consumer credit we have been living in a socialist america for 30 years. Consumer credit has been the great equalizer. I for one can’t wait until this unsustainable life style goes away. The idea that anyone would HAVE to spend hundreds of thousands of dollars to fix this place up is completely absurd.
Speaking of which, it’s not just the “do it yourself” crowd which is insane.
For example, we were at my wife’s parents’ house for christmas. I saw an ad for replacement windows that promised triple glazed, argon filled, low-e glass windows, 10 for $3995 installed and discounts for more.
When I came back, I got a mailer for where I live in Laguna Niguel with a fancy picture advertising double-glazed “insulated” glass windows (no argon, no low-e properties) 10 for $9995 installed, no discounts mentioned.
The cost to do things in SoCal is sometimes multiples of what it costs elsewhere. BTW, we paid $1.32 for a gallon of gas when we left and came back to $1.89 gallon. This place is a rip off, and the taxes just add insult to injury.
In the words of the Tan Man, “California Sucks”.
One thing many Orange County home sellers are gonna have to reason with, homes in the “desirable” areas are gonna be the ones the take the next big hit in this market. Especially on a dollar basis. The fact of the matter is the typical Santa Ana or Corona SFH has already been killed, in some cases REOs are selling for .30 cents on the dollar vs. the peak sell price. Unlike Irvine an other “desirable” areas, people can actually get financing in the less expensive communities.
This is very simple … the best, most desirable bedroom communities in Orange County are gonna go straight to hell, without passing go.
The agent didn’t bother to list the house’s two biggest selling points: this neighborhood is assigned to University High, and the homeowner association dues are about the lowest in Irvine. Other than that, yup, it’s overpriced.
“So let me get this straight: This house is a trashed and needs to be completely done over inside and out. Before I can even begin, I have to spend $600,000. I will need a $120,000 downpayment, plus cash reserves, plus another $100,000 to fix the place up. When I am done, I will be out-of-pocket over $220,000 cash, I will have a $480,000 mortgage, and I will have a 40-year old property in Irvine that will be worth less than my mortgage in two years.”
But it’s Irvine, when you say that to people that aren’t from here they look at you like your crazy, anytime a property has no pictures of the inside, BEWARE
San Clemente seems to be another OC area where prices on desirable units over 500k have yet to budge significantly on both sfh and condos. Price per sq/ft is about $350-450 and varies without logic up to $750 or more. One 35 y/o 2br ocean view condo is listed at $495k ($415 sq/ft) down from $675k in Aug, 2006, that would have sold for about $145k in 2000. It is being rented now for $1700/mo unfurnished. Assuming a rent/income ratio of 180, price would be $306000, still well above the $215K that traditional annual increases of 4.5% would reach from 2000-2009. I think prices in the $500K-1.5M range in south OC have a lot further to ultimately fall than 20-25% – more like 40-50% from current levels.
Thanks for the info on San Clemente. I’ve been looking there.
Patience: check my response to priced-out-it- guy below. Patience is the key. My wife and I decided when we sold in 1999 that if we wanted to buy back in SC a few years after selling when I retired, we could do so at a reasonable price. Who knew!! Consider renting while you wait; rentals are coming down in price. I suspect you’ll end up spending a lot less renting 1 or 2 years than buying 2 years early! And you’ll get to know the community. It’s changed significantly since 1978!
Maybe I should go by the moniker Goldilocks. I have been looking for 2 years (renting in Turtle Rock now) and I will continue to look until everything is juuust right!
SC is owned by old folks or their kids. Most homes from Christianitos to Pico own them outright (excluding new developments like marblehead, talega, and rancho). I wouldn’t count on getting an affordable property in SC anytime soon. Trying to establish oneself in a beach city is pretty difficult.
I’d also like to say that I’ve yet to meet a Marine or anyone else from other parts of the country that flock to SC for the beach lifestyle and be able to own a home and put down roots. The younger generate like myself rents and supports the local economy temporarily, finally realizes that we’re 20 years too late, and then moves inland or back home.
Sounds like your very familiar with San Clemente. Why do you suppose so many old folks stayed there – lots of other places in OC??!!
I’m one of the old folks who bought a 3br/2ba condo w/ nice ocean view in 1978 for 105K and sold 21 years later to our second son for $200k (a fair price at the time without a realtor). I agree that those people don’t have to lower their price but there have already been and, I think, will be more who have bought in the mania and will have to sell. In addition, I saw the same percentage price decreases/increases during the 78-99 period that occurred in so. OC. And the kids who won’t be able to use the property will end up selling, too. In short, In my view, SC will be no different than elsewhere in so. O.C. during the next 2-3 years.
Creative Solution
1. Stop paying mortgage. Save up mortgage payment for at least a year bc free living in the house.
2. Once house sells at auction, get free extra money from lender’s REA to move out before 60 days is up.
3. Wait 2 yrs for FHA loan (FHA loans not score driven, only need 12 months on-time payments) or 3 yrs for conventional financing with major $$$ down from a year of no mortgage/rent.
Easy.
Agreed. Just join the crowd. Stop paying mortgage and taxes. Live in it for free just like so many others.
5,100 Sq. Ft is considered a large lot?
It is for Irvine, where million-dollar homes sit on sod-covered postage stamps.
Yeah, I have a solution for the owner. Have a friend “accidentally” drive a truck through the house, and declare it a total loss. He did pay his insurance on time, right?
Seriously, I have a sneaking suspicion that the lot is the reason why the owner bought this dump in the first place. The original plan wasn’t to do anything to the original house: the plan was to sell it to an even bigger sucker, who’d demolish it within hours and build some zero-lotline American Godawful on the remains.
I’ve been watching this happen in Dallas, over and over, with great amusement. I used to be angry at how these schlubs would tear down older houses with incredible charm in order to build some soulless McMansion, but now I laugh. The reason is because the schlubs bought the houses at exorbitant rates, demolished them in preparation to rebuild, and then either have the resale fall through or run out of money to build them themselves. Ergo, they get stuck paying an obscene mortgage on a weed-strewn vacant lot, paying for someone to mow the weeds every week before they get fined by the city for creating an eyesore, and they don’t even have the benefit of renting out the property to cover property taxes. I mean, a couple of these would make good garden spaces, but why go to that kind of trouble for a spot that’s probably going to be foreclosed upon in another six weeks?
Hey, it IS a big house by Irvine standards — why not rent out each of the 5 bedrooms to families that have been foreclosed on and lost their homes? Since Irvine rent is so high, they may even be able to cover their mortgage payments.
The yard has room for a few tents, too — rent out campground spaces.
People expect an older home to be improved over the years doing nothing does not deserve the increase in price.
Not painting or fixing it up is simple maintenance that so many do not seem to do here. I painted my last house with a 12 year paint and that is what sold it besides it being in perfect near new condition at ten years old.
It was worth the price simple as that.
The bubble mentality is going to take a long time to change in people’s minds. You are no longer calling the shots–get over yourself Irvine owners and price your homes with some kind of reality. Think would you buy it yourself?
“Don’t worry”, I’d say to the owner.
Heck! You’ll have your loan reduced.
‘bama and Barney (Frank) are coming with a big bailout check.
You’ll live free and clear!
Courtesy of The “Socialist United States of America” – SUSA
To Scott’s point, here on the East Coast, I know several small contractors that are actively looking for and buying properties like this one (but definitely lower $/sq ft). They have little to no work but do have some cash along with cheap labor. So they target the distressed properties because of lower prices and these properties typically scare away families looking to move in and live life, which also opens the door to price negotiation. Each one I have talked to has plans to rehab and then rent it out and keep it for sale during the rental period. In their view, it’s a way to keep their small crews working and building wealth via asset acquisition for that next big payday bubble.
just testing something in an old thread:
test