Tuesday, April 29, 2008
In my experience the rule of thumb is your mortgage payment can not be more than 1/3 your monthly gross income. I don't know where the 3x your annual income rule comes from, but in as much as the median household income for LA is something around $45K, it would mean no one should finance a mortgage of more than $135K. (Which even in the "good times" wouldn't buy you a garage)
Yes, but keep in mind that $135k is the mortgage -- not the price of the housing. So if you had a $100k to put down, then you'd be able to swing at $235k condo. You will be able to find some decent units in that range right now and even more by the end of the year.
If you made $45K per year, got a 30 year conventional at %5.75 you could finance $200,000 for payments of $1,167.00, still less than 1/3 your gross.
I don't disagree with you assuming we are talking about somebody who has strong odds of a higher income in a few years (e.g. a newly licensed nurse). But for people with unpredictable income streams or who have government jobs that provide reliable but small cost of living increases, that payment might be a bit high. I think they would be more comfortable with a payment that was 1/3 of their net pay (not gross pay).
I guarantee most people buying $1M homes are not grossing $330K per year. Of course if you buy a $1M home today you'll need to put $200K down, so if you finance the balance of $800K on a 30 year conventional at 6.25% you'd be looking at mortgage payments of around $5,000 per month, meaning you need to gross $15,000 per month or $180,000 per year.
Again I agree with you: many people buying $1M homes are not grossing over $300k per year. But that doesn't mean it's a good idea. They *should* be grossing that much to buy a $1M home. But let's say you were grossing $180k, I still think that $5k a month could be a steep payment for you. After taxes and retirment contributions, that $5k would be about 70% of your take home pay.
And no you never have to buy a house, but I think if you find a house you love, is reasonably priced and can comfortably afford, then why not buy it now?
Because you know with an absolute certainty that you will lose money for several years.
To me it would be like trying to time the stock market.
Typically the stock market is far more volatile than the housing market. And I'm not suggesting that you have to buy at the absolute bottom -- I'm just saying don't buy when you know it's the peak of a market that resulted from irrational exuberance.
Buy sensibly, enjoy your house and don't obsess over every last penny. Yes it may go down another ten thousand.
Again, I totally agree. Obsessing over every penny is ridiculous. But what if it's not just $10k -- what if it's 30% of the value of your home evaporating over the course of a year or two? That's something to think about for a minute.
Interest rates may go up another point too. $100K at 5% is the same monthly payment as $90K at 6%.
Yep. And that's why if interest rates go up, housing prices will go down even further. Because people won't be able to afford them otherwise. Indeed, that's part of the reason prices went up so much over recent years: low interest rates.
I'm not really disagreeing with your point, I just don't like these broad generalizations that anyone who buys now is an idiot. It depends on the circumstances and it depends on the house.
I do think that on 90% of the issues we agree. I'm not saying everybody who buys now is an idiot. And certainly there are lots of people who would think I'm an idiot for buying a pair of Dolce & Gabbana shoes recently (which lost about 50% of their resale value the second I wore them). I get that everybody has to make their own choices. But for most of us, this is not the time to buy a house.
Most of us can't afford to lose twenty or thirty percent of the biggest investment of our lives over then next several years. But for some of us that loss would be the equivalent of the Titanic losing a deck chair -- it's almost imperceptible. So if you are in the latter camp, this is a great time to buy because there is a lot of selection and you can afford it. But if you are a regular Joe like me, then all I'm saying is wait a bit longer. There's probably nothing wrong with your rental. And if there is, rent a different place.
Monday, April 28, 2008
Which brings us to a comment that was posted by UserAndy today. He writes:
I think the 3x rule should be reiterated to buyers and lenders alike: No one should buy a home that costs more than 3x their yearly gross pay. Alternately, no one should be paying more than half thier monthly take-home pay on their housing costs. I like this rule better because it's just as good for renters as it is for potential home buyers.
However, you [Kate] don't address people that are buying to STAY. There is a really big monthly savings for home-buyers that have payed off their mortgages altogether. Not only does their month-to-month living expense drop significantly, but they now have a nice big asset that long-term renters do not. Prices, in the long run, will go up for both renters and homeowners.
For that fact alone, it SHOULD be (Andy's rules of Fairness) less expensive to rent than buy!
Andy is right that owning your house outright is a big savings. But most people stay in their home for about 5 years and never own their homes outright. (Go ahead, Google it if you feel the need). And so, for those people, it makes no sense at all to buy right now -- in this market. Essentially, those five-year "home owners" are really just in an outrageously expensive rental situation.
And, even if you really truly think you will be in your house for a very long time, you still should try and follow the tried and true affordability guidelines. Because even though you don't PLAN on selling, you could get divorced, or sick, or laid off, or have to up and move to New York City. And then you will be plenty glad that you bought in a buyer's market and didn't get in over your head because you will have options.
And don't give me that "but I have to buy a house RIGHT NOW" argument. You do not. I don't care if your wife is pregnant with twins. You have to find a place to live -- you don't have to buy it. There's no shame in renting. There is shame in wasting a lot of money. Especially if your wife is pregnant with twins.
Friday, April 25, 2008
Square Feet: 2,195
Lot Size: 17,600 Sq. Ft.
Year Built: 1955
Listing Date: 04/23/08
List Price: $850k
Per Sq. Ft. Stats:
Based on List Price: $387
Based on Zestimate™: $502
Based on Cyberhomes estimate: $478
Sold Homes: $282
Is Zillow perfect? Nope. Can Zillow really tell you the exact value of YOUR house? Nope. It runs on an algorithm, People -- they are not going to your house and taking measurements and evaluating the quality of your roof. Zillow is not a damn crystal ball either. It cannot tell you what your house will sell for. You know who can tell you what your house will sell for? YOUR BUYER. Ugh. When you build a better algorithm, let me know. Until then, Zillow is the gold standard. It is. I know you want a crystal ball, but don't get mad at Zillow for not giving you one. They are giving you existing data and that has real value.
That said, Zillow posted a helpful response to my post and I figure it deserves some highlighting here. In fairness to my other commenters, I'm republishing all comments on that post (because even though we sometimes disagree, I still love you guys! And divergent opinions are important). Here we go:
Hi, it's David G from Zillow.com,We currently ignore all foreclosure transactions because foreclosures are typically not a measure of market value (in a normal market.) In a normal market, Realtors do the same thing when setting prices. It would typically be stupid for a seller to comp their home against foreclosures. Now, however, there are so many foreclosures in some areas that sellers have to compete. This is no "normal" market; at least in SoCal and elsewhere. Foreclosure inventory is so incredibly high in places like San Diego that foreclosures literally are the market. Pretty scary. Banks don't have the same motivation sellers do to hold out for their price. It's not hard to imagine that some markets are literally in free fall until the foreclosure inventory drops. Our analysts are actually reviewing whether there may be a way to identify and account for this phenomenon but for now, Zestimates ignore foreclosures.
April 24, 2008 6:09:00 PM PDT
Hey David G- get used to foreclosures being the measure of the market. Hate to tell you, but the "zillow way" of assessing the market is over!
April 24, 2008 10:21:00 PM PDT
Hi David G. As a potential homeowner, I am extremely disappointed that team at Zillow feels that without foreclosures included this is a "NORMAL" market. Based on this simple post, I am concluding that your algorithm is not designed to handle real-estate prices appropriately. In a normal market people making 80K a year cannot afford 500-600-700-1mil homes !!! Foreclosures/REO's are priced (marked-to-market) by the banks !!!!!! Even though bank prices are still high, they (the banks) feel they are pricing these houses appropriately, yet you feel this is not part of a normal market !!!You cannot ignore market data !!! Foreclosures are part of the market !!!! Bad trades are not ignored on the stock exchange, yet you feel you have the right to remove valid data from your algorithms. Guess what, it is going to get worse, stop giving people hope !!!!!!!!Disgusting !!!
April 24, 2008 10:24:00 PM PDT
"Foreclosures/REO's are priced (marked-to-market) by the banks !!!!!! Even though bank prices are still high, they (the banks) feel they are pricing these houses appropriately...:Small distinction: Banks do not price the houses to what they should be worth (factoring out the housing bubble). They price them as high as they can, in a market of buyers willing to pay for that price level. "You cannot ignore market data !!! Foreclosures are part of the market !!!! Bad trades are not ignored on the stock exchange, yet you feel you have the right to remove valid data from your algorithms."On point! :)
April 25, 2008 7:48:00 AM PDT
Stop listening to David after: "Realtors do the same thing when setting prices."Annnnnd???Why would a Realtor WANT to comp a foreclosure when their commission is based on HOW HIGH a piece of property sales. I mean, is Zillow about market value pricing or isn't it? If you don't want to be a flash in the pan, stop using the outdated realtor model and ADAPT.
April 25, 2008 11:57:00 AM PDT
Thanks David G for pointing out how Zillow is a trailing indicator at best and totally useless. In fact, it's more useless the more dynamically the market is changing in either direction by definition... BRAVO!Well there is one use, for realtors looking for another piece of inaccurate data with which to fool 'clients' into paying more. Is the the goal of Zillow? Your 'normal' market definition is bull$hit. Period. If Zillow were not fraudulent, it would show what it says it shows - what a house will sell for in the marketplace. How on earth can that not include foreclosures? Are market prices set by what realtors say they're worth or what people pay?
April 25, 2008 1:08:00 PM PDT
Actually, I think it's important to point out that Zillow is more wrong the more a market is changing, but it's MORE wrong on the way down than it is on the way up - because it eliminates foreclosures but not very high (fraud?) sales. How realtor of you, Zillow. You're worse than everyone you're trying not to be because you imply you're not acting in the same manner to deceive and keep info from the marketplace.
What ya do is take the cost of owning and divide that by the cost of renting a comparable property. If you get a number greater than 1 that means owning is more expensive than renting. If you get a fraction like 1/2 well then it might be an excellent time to buy because renting is more expensive than owning.
Let's do the math. For a home that recently sold at or around $750k the tax would be about $6k a year (because the assessed value would be a bit lower than $750k). Let's say your mortgage payment is about $4k a month (times 12 months would be $48k/year). So just tax and mortgage on your $750k house is $54k/year. If your roof leaks or your sink clogs or a pipe breaks -- you'll have to pay for that too. And even if there are no repairs, you still have to pay for a gardener and big water bills to keep your lawn green. Let's be conservative and say you have about $4k/year in maintenance costs. Now you are at just shy of $60k per year or $5k per month.
What would be a fair rent for your house? I can tell you that in Sherman Oaks, most homes that were recently selling in the $750k range are renting for about $3,500/month. That puts the own to rent ratio at 1.43 (5k/3.5k).
I can hear you squawking about the tax benefits of a mortgage already. Well, zip it. There are other ways to get tax benefits. Yeah. That's right. Like you can do a pre-tax contribution to your 401k and IRA. Maybe you could do that in addition to your home ownership -- assuming you can still cough up the $5k a month -- but you could definitely afford it if you were renting.
In this market, nobody is going to sing the praises of home equity to me because: guess what? If you bought after 2004, you are upside down right now. Yes. You. Are. If you are very lucky, you can sell your home for exactly what you paid. But that would still be at a loss because you have to deduct all this from the sales price: (1) the 6% you will fork over to your agent and the buyer's agent; (2) 1.5% in closing costs; (3) all the interest you paid on your mortgage every month that you owned the house; (4) the cost of any improvements or repairs; and (4) lost opportunity costs (i.e. if your money were just sitting in the bank it would've at least shown you a 3% positive return but you didn't do that). Yup. And that's if you sold for what you paid -- imagine if you sell for less than what you paid. In that scenario, you not only lost a big old hunk of cash but now your credit is all jacked up.
So our renter spent $42k/year while our "home owner" (quoted because, in fact, the bank owns this house) spent $60k/year for the same privilege. And our homeowner lost more than the extra $15k extra he paid in tax, mortgage and maintenance every year, he also lost $56k in transaction costs when he sold his house for exactly what he paid. Sort of looks like it wasn't our renter who was "throwing money away" after all.
The chart below shows when it was the right time to buy a house in Los Angeles over the last 28 years. As you can see, there were plenty of opportunities to buy. Just not recently. And certainly not right now.
By the way, if our "home owner" earned a modest $150k per year, that leaves him about $600/week to cover the rest of his expenses. In LA, gas and car insurance are about $100/week. A cell phone is about $25/week. Utilities and cable are about $75/week. If you ate all of your meals at home you could get by on $100/week. Thus, after the basics, he'd have $300/week assuming he didn't: have a wife or any children, buy any clothes or gifts, have any student loans, lease or make payments on a car (that never breaks down or needs an oil change), get sick or injured, pay for health insurance, or spend any money on vactions or entertainment beyond cable TV. And that's pretty much the only way our homeowner could hope to save 10% of his gross income for retirement. I guess that's why they say your mortgage should be no more than 2 or 3 times your gross income, huh?
Thursday, April 24, 2008
Note that Zillow is throwing out the foreclosure sale price at $789 because Zillow can't believe how low it is. Ha! Believe it Zillow! Believe it because it's going to sell for about $200k less than that.
Once this house sells, which should be any minute now, it'll be interesting to see whether the value graphs for the neighborhood plummet or not.
(MLS #: F1752937)
Full Baths: 3
Square Feet: 2,015
Lot Size: 6,290 Sq. Ft.
Year Built: 1951
Listing Date: 02/01/08
Last Sale: 06/14/06
Sales Price: $950,000
Price Reduced: 02/11/08 -- $704,900 to $654,900
Price Reduced: 03/03/08 -- $654,900 to $639,900
Price Reduced: 04/23/08 -- $629,900 to $584,900
Per Sq. Ft. Stats:
Based on List Price: $290
Based on Zestimate™: $386
Based on Cyberhomes estimate: $452
Sold Homes: $433
Tuesday, April 22, 2008
Here's a little listing from the Mission Hills neighborhood. Trust me, it's a lovely part of town! Close to downtown, close to the beach, no tract housing... there's not really a comparable neighborhood here in L.A. but maybe Brentwood near Wilshire is as close as you can get. So what do you think a 900 sq. ft. 1+1 on a small lot would go for? Checkitout:
MLS #: 086008711
Full Baths: 1
Square Feet: 952
Lot Size: 4,356 Sq. Ft.
Year Built: 1925
Listing Date: 02/02/08
On Market: 80 days
List Price: $699,000
Last Sale: 01/13/99
Sales Price: $312,000
Based on List Price: $734
Based on Zestimate™: $655
Based on Last Sale (1999): $327
Sold Homes: $360
It's a darling little house. But $700+ per square foot? When their market peaked back in '05? It'll be interesting to see if this house can move.
Monday, April 21, 2008
Here's a supercrazyfantastic video link. Seriously. Awesome. And here's an article on Rajan the elephant that swims. What are you waiting for? Go on. Shoo!
Friday, April 18, 2008
The listing description:
Drastic reduction! Spectacular chic entertainer's pad with wonderful view amidst a woodsy private setting.... blah blah blah
And here's the details:
(MLS #: F1760298)
Full Baths: 2
Partial Baths: 0
Square Feet: 1,185
Lot Size: 5,510 Sq. Ft.
Year Built: 1941
Listing Date: 03/27/08
Price Reduced: 04/17/08 -- $809,950 to $789,000 (2.6% down)
But it's not just the 2.6% (a.k.a. "drastic") reduction that set me off. It's also the outrageous price per square foot (even after the reduction).
Square footage stats:
Based on Original List Price: $684
Based on REDUCED List Price: $666
Based on Zestimate™: $685
Sold Homes: $420
This house is in a nice little neighborhood. But I can't imagine anybody shelling out around $800k for an 1185 sq. ft. two bedroom house on a small lot. In. The. Valley. I mean, come on. This house sold for $381k six years ago. Here's the Zillow chart:
Wednesday, April 16, 2008
Here's a little game I play all the time. Basically you pick an MLS listing and, based on the photos and description, you try to figure out what they AREN'T telling you. Ready to play?
The description reads:
Land lovers [sic] dream! Half acre in studio city's [sic] silver triangle [sic]. A 'demi designs' retreat with private walking paths to intimate viewing patios and lookouts. Remodeled baths and kitchen with viking [sic] range, detached studio/garage, and flat yards. Walk to ventura [sic] and carpenter school [sic]. Location, location, location!
I have no idea what "demi designs" means. Do you? I'm also not sure what an "intimate viewing patio" is but I suspect it means you hike up the hill to a clearing if you want to see the view.
(MLS #: 08_267633)
Looking at the featured photo, right away you might wonder: "Where's the house?" A red flag in any listing. Of course, if your front door was this dark and uninviting, you might not want to feature it either:
I dunno, something about this porch makes me hear banjo music in my head. And not in a good way. More like in a "Deliverance" way. Anyhoodle, let's move on to the details.
Square Feet: 1,360
Yeah, I figured it was lees than 1,700 square feet. No wonder they want you to focus on the lot. So how big is the lot?
Lot Size: 21,180 Sq. Ft.
WHOA! That's a big ole lot. Kind of a small house, but a giant lot. You probably want to see more of the lot, right? I mean, the feature photo is lovely but that doesn't exactly look like buildable land.
Odd angle. Perhaps they hope you won't notice that this is about a 6 foot wide strip of grass (but how could you not notice that?). I suspect this is the "flat yard" they mention and I'm sensing a lot of unsuable land here so I Google Mapped it (I heart Google Maps!). Trees obscure the view of this lot (and if you can't see in, you can't see out) but the neighbor's house gives you a good idea of the terrain. Here's the neighbor's place and I've angled the camera up.
That's a pretty steep hillside a'ight. But just because this is a small house with a mostly unbuildable lot doesn't mean it's not a good buy. I mean, I'd still consider it at the right price. So what is the price anyway?
Listing Date: 03/31/08
List Price: $999k
Oh, Sweet Fancy Moses! That's $735 a sq.ft. Is there gold in dem dar hills? Seriously. But guess what? That's about what the owner paid back in '05.
Last Sale: 12/02/05
Sales Price: $965,000
I don't know why they paid that in '05 -- there must be one of those super fancy gourmet kitchens or something -- they did mention a Viking range. Let's look.
Guess not. I can't say for sure but it looks like those cabinets are from our excellent Swedish friends at IKEA and that stove is not the professional range you picture when you think of a Viking range. Love the way it's just sitting in a corner all by itself. Hello? Counter space? And what's up with that little shelf and stool to the right? Is that where you sit after the teacher yells at you? I expect a little (okay, a lot) more than that in a million dollar house. Let's look at the bathroom.
I guess this is the bathroom. There's a sink and a mirror so it's a safe guess. Judging by the fact that they won't actually step in there to take the photo, I'd say it's not a luxury spa style bathroom.
Well, it must be the view that's justifying the price. Of course, when you have a stunning view the listing typically features no less than three photos of it: daytime, sunset, and twinkling lights at night. Here we have zero shots of the view. And I don't think they forgot to post them.
Tuesday, April 15, 2008
(MLS #: F1760083)
This house has an interesting sales history:
04/30/1999: $ 580k
Yeah, you read that last sale correctly. They paid $1.42M a year ago. And now, after the worst year in SoCal real estate history, they want to sell for $125k more than they paid. I mean, I get it. The commisions on this sale are over $90k. And they need *some* wiggle room in the price, right? But how do you figure that your house held it's value while the rest of SoCal took an 18% nose dive?
I dunno. It could move. It's a nice house, after all. But I can seriously see this house selling in the $900k range in the not-too-distant future.
Monday, April 14, 2008
So, are miracles still happening out there? They are! A Van Nuys adjacent house can still sell at $400 sq. ft. and I think that's a bloody miracle.
Nevermind that the seller paid $772,500 back in January '05. (That's right, he sold for $2,500 less than he paid over three years ago, in case you failed to notice). And let's not forget the $46k in Realtor commissions. Oh, and the interest payments (approximately $48k per year times 3 years = $144k). Dang, when you add it all up ($190k), that was one expensive rental (about $5k/month). Oops! And that doesn't include three years of property tax & maintenance. And closing costs, twice. I'm pretty sure you could rent a 3+2 house in the area for less than half that. And, I dunno, maybe put the other $2,500 a month toward a 401k. Call me crazy.
But the seller still sold at a remarkably high price given market conditions. The Realtor Team who pulled this off? The Fred Meyer Team, on the web at http://www.fredmyer4u.com/. So if you want to sell your house for slightly below what you paid in 2005, you might want to give them a call.
Let's talk about the buyer for a second. Sure, shaving off the last three years of property value increases is sweet! But, umm, you realize that most of the bubble increase was pre-'05? Maybe I should draw you a picture of what I mean. Here's the Zillow graph of the property value for your house (your house is in dark blue and your zip code average is in light blue):
What I find really interesting is how much the gap between your home's value and the average home value in your zip code has shrunk. Back in '05, there was a $300k spread. Now there's just a $200k spread. See, that's interesting because it means that your house is losing value faster than the zip code as a whole. I bet that trend will continue. But, you know, I've been wrong before. Like when I thought nobody would pay list price for your house. I guess you showed me!
Friday, April 11, 2008
(MLS #: 08_270259)
Last Sale: 03/22/02
Sales Price: $420k
Listing Date: 04/08/08
List Price: $899k
Sq. Ft. Stats:
Based on List Price: $513
Based on Zestimate™: $481
Based on Cyberhomes estimate: $378
Sold Homes: $376
The kitchen is clean and has some charm but it's certainly not state of the art. And you know what they say: "kitchens sell houses."
So what do you guys think? How long will this house stay on the market? And at what price will it finally move? I'm thinking 90 days with a couple of price reductions and selling in the low $700s.
Monday, April 07, 2008
So, Krugman is saying what YOU have been saying all along. Yup. From his CNNmoney.com interview:
How far do you think home prices will fall?
My preferred metric is the ratio of home prices to rental rates. By that measure, average home prices nationally got way too high. We'll probably basically retrace all that. So that's about a 25% decline in overall home prices. Only a fraction of that's happened so far. Of course, it varies a lot. In places like Houston or Atlanta, where home prices have not risen much compared with underlying rents, the decline will be relatively small. In places like Miami or Los Angeles, you could be looking at 40% or 50% declines.
What can Fed chairman Ben Bernanke do in terms of cutting rates? You wrote on your blog recently, "Keep cutting, Ben!"
Yeah, that's right. I'm now reasonably sure that they will cut again and again and again. A few cuts of 75 basis points and we'll be down to zero. And there's a pretty good chance that we're heading to zero, and that there's going to be a Japan-style ZIRP, zero-interest-rate policy.
Has that happened in the U.S. before?
Not since the 1930s. They didn't have the Fed funds target rate back then, but effectively we had a zero-interest-rate policy for a good part of the '30s. If the Fed responds this time with as much cutting as it did in the last two recessions, we get to zero. And then the problem is, What if that isn't enough? And there's a pretty good chance it won't be.
Friday, April 04, 2008
And, to put those numbers in perspective a bit ... At last count, inventory in Los Angeles was around 54,000. Sales for February '08 were just shy of 3,500.
Inventory stats courtesy of the good people at Bubble Markets Inventory Tracking. A fine site if ever there was one.
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Anyhoodle, here's the listing:
(MLS #: B2102968)
Click image to enlarge.)
Square Feet: 1,008
Lot Size: 7,122 Sq. Ft.
Year Built: 1925
Listing Date: 04/03/08
Per Sq. Ft:
Based on List Price:
Based on Zestimate™: $857
Based on Cyberhomes estimate: $690
Sold Homes: $328
Thursday, April 03, 2008
Crazy scary. Here's that house on Morrison (a.k.a. the "Worst Listing Ever") that I wrote about below. Check out how awful the house next door is! Click to enlarge image.
BEFORE (needing some fresh colors and new landscaping):
AFTER (needing to be relocated to a different neighborhood):
(MLS #: F1753755)
Square Feet: 4,200
Lot Size: 8,250 Sq. Ft.
Year Built: 2008
Last Sale: 06/18/07
Sales Price: $730,500 Listing Date: 02/11/08
List Price: $1,629,000
Wednesday, April 02, 2008
"First time buyer's [sic] don't delay!"
"First time buyers" = People born yesterday.
"don't delay" = Because if you took the time to open a newspaper or talk to just about anybody, you would change your mind about buying this house.
"Great opportunity to buy in sherman oaks [sic]."
"Great opportunity" = This is literally true, it is a great opportunity (if you are the seller and you can find a big enough sucker).
"This fashion square [sic] traditional home offers original charm & more."
"original charm" = No improvements.
"charm & more" = No improvements.
"Great for owner user [sic] to add & build home."
Okay, I have no idea what an "owner user" is, but I can tell you that "add & build home" means you will have to tear down this home and start from scratch building yours.
Without further ado, I give you:
(MLS #: F1757259 )
Full Baths: 1
Square Feet: 1,122
Lot Size: 5,900 Sq. Ft.
Year Built: 1948
Listing Date: 03/05/08
List Price: $975,000
You read that correctly. This house is $869/sq.ft. despite the fact that it has one bathroom and it is the same size as an average one bedroom apartment. It has no view. It is not close to the beach and it is not in the hills. Finally, it does not appear to have undergone any improvements since it sold at the peak of the market for $650k. At the peak of the market!
Sweet fancy Moses. What are they thinking?
UPDATE: An eagle-eyed reader points out that this house is actually a McMansion now. Here's the current listing. But I stand by my position that this is the WORST listing ever. The listing photo is of the original house. The list price is not for the last sale (which was $650k) and it is not the currently offered price ($1.3M). So what the hell? And will anybody even remotely consider paying over a million dollars for a 5,900 sq. ft. lot that's Van Nuys adjacent?
5530 VENTURA CANYON AVENUE, Sherman Oaks, CA 91401
(MLS #: F1732590)
Square Feet: 1,798
Lot Size: 9,234 Sq. Ft.
Year Built: 1928
Listing Date: 09/01/07
Price Reduced: 10/03/07 -- $912k to $899k
Price Reduced: 10/05/07 -- $899k to $889k
Price Reduced: 11/19/07 -- $889k to $849k
Price Reduced: 12/28/07 -- $849k to $799k
Price Reduced: 04/01/08 -- $799k to $768k
Per Square Foot
Based on List Price: $427
Based on Zestimate™: $415
Based on Cyberhomes estimate: $318
Sold Homes: $711