Smoking Crack Seller

5511 FALLBROOK Ave Woodland Hills, CA 91367
3 Bedrooms, 2 Bath 1700 sf on a 7800 sf lot.

Asking Price: $799,000 that is $467 per sf
UPDATE:
Now asking $610,000
Value is around $400,000 and dropping...

This seller is smoking crack, the house description is hilarious.
" NICE AND LOVELY 3 BEDROOM AND 2 BATH WITH FIRE PLACE IN LIVING ROOM HAS GREAT OPPORTUNITY FOR ALL TYPE OF USE"
As always, the asking price is a result of a flipper getting stuck by buying at the peak and getting the worst timing doing that...
Sales History:

Sep 10, 1997	$157,500	.
Sep 30, 1998	$205,000	.
Sep 22, 2005	$620,000	.

similar houses are at that area are selling for 2003-2004 prices, that means that this house value today is about $420,000-470,000, while the owner is asking for almost double....
Zillow zestimate it at $549,500. Pay attention to they latest ranges, for this one it is $467,075 as low and $604,450 as high.


For reference here is a similar house practically next door.
5611 FALLBROOK AVENUE, Woodland Hills, CA 91367
3 Bedroom, 3 bath, 1700 sf, on a 7800 sf lot.

Asking price: $455,000 that is $271 per sf
UPDATE:
Sold $432,000 (08/05/2008)

Case Shiller Updated to February 2008

I am plotting here the graph for LA with two projections. I want to know which one makes more sense to you.
The Blue line is the current S&P Case shiller for LA updated to February 2008
The Pink line is my prediction of house prices behavior from now to about 2012
The yellow line is the housing Bulls prediction of house prices behavior from now to about 2012

The pink line assumes that the unavailability of stated income loans, Option ARMS and stated second mortgages will simply decrease the number of qualified buyers to such a point where over correction would occur, then after getting to some support level by wages, market will flatten and start increasing at the rate of inflation.

The yellow line assumes we have hit bottom, and not going to be flat or start appreciating again....

Now, you tell me, who do you think is right?

Fraudlent COMPS in the Valley

This property might be a reason to open a brand new category on this blog and call it the BEST FRAUD CASE.
I accidentally found this house while browsing foreclosures and pre-foreclosure properties

6201 Corbin Ave Tarzana CA 91356

Sales History:
Sold Aug 29, 1995 $203,000
Sold Feb 07, 2006 $640,000
Sold Jan 05, 2007 $1,330,000
It has NOD right now
Will be Foreclosed on **** for $*****

Zillow zestimate(tm) : $1,108,000
True market value : $500,000-700,000

This is my idea of things that went on here;
Buyer X bought in Feb of 2006 for $640,000 (this is close to the peak of prices in the valley)
He then either fixes the house a little, or throws a fresh paint and lists it for sale for $800,000-1,000,000. Then comes buyer Y, and offer X to pay him more than asking price. How?? Simply on January 2007, every thing that can walk on two feet can get a loan. They find a "good" appraiser that is probably getting paid to appraise this house for more than $1,330,000.... So Y gets the loan, X kicks back $200,000 to Y and everybody wins...You might thing that the bank is about to loose here...Rest assured Congress is working now on ways to make sure that the bank will not loose here. We the tax payers need to bailout this People...

Even worse, if buyer Z wants to buy a house on the street, his RE agent will use that fraudulent comp of $1,330,000 to justify him paying similar amounts for a similar sized house.....
You tell me, does any comp on that street is legit???
It is all based on fraud.

REO for sale by bank that doesn't want to sell....

5537 Sylvia AVE Tarzana, CA 91356
Sales History:
Sold old shack Apr 10, 2003 $370,000
Sold after building new house Jun 01, 2005 $1,260,000
Found (another) sucker to pay Mar 15, 2006 $1,520,000
Foreclosed Jul 06, 2007 $1,074,207
Now asking $979,900 (after initially asking Jan 05, 2008 $1,153,900

This one is awesome. I would not spend your reading time going through the process of the bank realizing he needs to slash the asking price, but would rather show you one picture from the listing.
Look at the pool and the water condition inside, is that a way to sell a house??? If you can't clean the pool and maintain it, please don't take a picture of it. Also poor neighbors with mosquitoes...
One picture is worth a 1000 words....
LOL....

Flipper Bought from Foreclosure & Heading to Foreclosure...

22603 Clarendon St., Woodland Hills 91367
4 bd, 3.5 ba, 2501 sf, 6750 sf lot
So this house is located in the epicenter of the valley's flipper city.
I don't know if this is funny or stupid. It does show us what catching a falling knife is.
Also, this can help to see how is it to buy at REDC auction together with another 3000 (un-knowledgeable or over-excited) buyers.

On Oct 28th 2007 - It sold for $640K plus 5% REDC commission to total $672,000
This house was listed for $759,900 - $679,900 for 125 days May thru Sept. 2007 and obviously did not draw any offers.
Here is the sales history:
Sold Jan 11, 1989 $333,000
Sold Nov 23, 1998 $299,000
Sold Oct 03, 2001 $320,000
Sold Jul 15, 2005 $820,000
Sold Mar 21, 2006 $980,000
Foreclosed Mar 27, 2007 $744,750
Sold Nov 27, 2007 $672,000

I decided to show the 1989 sales price since i think most of you know this was a sale close to the 90s housing boom. If we consider even high 4% inflation of 19 years since then. The price should have been about $701,000. Since it sold in end of 2007 for less than that. It proves that housing is terrible investment tool. It barely tracked inflation for 19 years!!! But not more than that...Also today is not the bottom either...

The interesting part here that the buyer which is obviously a flipper, paid $672,000 that is $308,000 (or 31%) less than last price which might sound great...(btw who was the fool to pay $980,000... I'll get to that later)
So, this flipper turns around, paints the house and cleans/changes the carpets. Then he lists it for sale for......$900,000. WOW. Today after about 3 months of no bids, he placed a FOR RENT sign...
The zillow zestimate(tm) is $844,000
Today its street price is $500,000-540,000 (check out next block 22620 Clarendon ST listing...)
Actual value per lakerland estimation $320,000 (roughly 2001 price)

Now, let's get back to the $980,000 sales price. As you can see using the sales history, the house was foreclosed exactly 12 month after being purchased or refinanced. For those who know how foreclosure work in CA, will know that 12 months is about the time it takes from the moment the borrower stops paying. That is 3-5 months to get NOD, another 3-4 months to get NTS, and another 1-3 months to become sold at court step auction and become REO.
That means this borrower never made a single payment!!!! If you look at public records, it is clear the this property was sold in 2005 for $820,000. The owners, after 6 months, figured out that they overpaid, and would probably can't afford the house (which was used as an elderly rehabilitation center). So they decided to use the lax, no doc, maybe option ARM country wide loan, and cash refinanced it by pulling $160,000 cash. Countrywide has never since a payment from them since....

Conclusions:
1) Fraud, lax lending, crazy loan - foreclosure
2) Greed by new flipper that thought he could paint and flip but ops...he caught a falling knife.
Now with mortgage payment of about $3000, he can't find a renter to pay it. He also put 20% of his cash for down payment.....bye bye $134,000....

Buying at Top of Market or Just Plain Flipper Stupidity

4656 Willens AVE Woodland Hills, CA 91364

It is unclear whether this seller has bought to flip this house or to actually live there but did that in the wrong time.
In any case, he simply over paid, and within 6-8 months got himself in upside down position...
Sales History:
Jun 29, 2007 $755,000

After about 5 month, he lists for sale and plans for some $100,000 gross profit:
Asking Dec 24, 2007 $865,000
Price decrease Jan 12, 2008 $799,000
Zillow zestimate(tm) $827,500

Still no takers...

=================================================================


5869 Eilat PL Woodland Hills, CA 91367
This one seems to be a loan owner that bought the wrong place at the wrong time...
It is simply hard to believe it was a flipper with expectations that this property would go to $2M or more...
Sales History:
Sold Dec 23, 1996 $335,000
Sold Sep 08, 2006 $1,246,000 ( I thought this was the peak year...)
Sold Jul 11, 2007 $1,499,000 (wow....)

Listed for sale after six months of "loan" ownership.
Asking: Feb 14, 2008 $1,400,000 (loss of $100,000 or 6.7% but still asking above 2006 price)
Reduced Mar 26, 2008 $1,100,000 (loss of $400,000 or 27% and gets closer to reality...)

Still, this property is probably worth $900,000 today considering a fresh comp (larger&newer house) but has actual value of about $550,000.

A new contender for flipper of the week

Check out this flipper...acting quick to fix, and list on MLS. I guess he knows where prices are going...and how fast...
19953 HAYNES Woodland Hills, CA 91367

Prior Sales History:
Sold May 25, 2001 $285,000
Sold Mar 31, 2006 $750,000
Foreclosed Jul 18, 2007 $557,750
Jan 25, 2008 $500,000

Zillow zestimate(C): $579,500

Asking Price: $725,000

Now, let me get this straight. The guy buys this shack from the bank for $500,000. The house was completely destroyed and was used as whore house for couple of months...
The flipper claims he spent $100,000 in remodeling...So after less than 60 days, he lists for sale and looking to make $225,000 gross profit, that is 45%...
Even if we take 2-3% commission to buyer's agent and the claimed $100,000 (i wonder if he can prove it) Still very nice "theoretical" profit.
Problem is that this is still a shack. Couple of travertine (made in china) tiles in the kitchen, and a fresh coat of paint does not justify that asking price.
We will track and see what happens to this smart flipper.
My guess, he will be lucky to get his $500,000 back.