That forum discussion is interesting. It reminds me of a realtor friend who is convinced prices can’t go down. Or of republicans who are convinced that they’re righteous tough guys.

If you only hang around with or listen to people who share your point of view, you’re unlikely to get the full picture.

Eventually, though, the full picture will be undeniable. Enough people in their circles will eventually understand what’s happening, a critical mass will be reached, and, once that happens sentiment will change fairly quickly. Kinda like Bush’s poll numbers finally plummenting after all his years of incompetence. There’ll always be a few who don’t see the light, but, for the purposes of the housing market, those few won’t matter much. The sea change in sentiment that should happen in the next year or two will be enough to send the market down substantially.

What do politics and Bush have to do with a Clairemont Mesa flipper and San Diego real estate?

Can we get past the politics here?

Kinda like Bush’s poll numbers finally plummenting (sic) after all his years of incompetence.

I see the connection now. This has everything to do with San Diego real estate.

the flipper got the place in 2/2006 for $465,000. Now they are trying to flip it for $598,000, a $133,000 profit.

They certainly did A LOT. The before pics showed a absolute disaster zone. I really wonder about the renovation cost. Which the flipper did not post on the forum.

This one is worth tracking.

I agree about the difficulty of buying at the bottom. I spoke to that when a few people said they’d buy if prices dropped a certain percentage. It’s hard, from our current perspective, to understand how things will be then. All the talk will be, “it’s not like last time. Prices will not recover like they did before. The outsourcing of our jobs will render future increases in income meager at best. The damage to our economy from years of budget and trade defecits will take decades to recover from. China and other Asian nations have stopped funding our spending spree (buying our debt) and interest rates are going to keep rising. Unemployment and underemployment are so high that few can afford a house.” The list will go on. The prevailing wisdom will be that buying real estate is pure tomfoolery. And when things start to get better, it will take a long time for the herd to catch up. They’ll still be going with the prevailing wisdom. Just like they did on the way up. Just like they did with Bush. Just like humans do in countless other endeavors. Going against that takes courage. Going against that and doing it at the right time takes courage and smart research.

well, they bought for $465,000, so they are down to $100,000 minus all expenses.

on the forum, lots and lots of questions about the price of the renovation. silence from the flipper. quite frankly, sounds like she’s still trying to figure it out. quite a number pointed out they wouldn’t have done so much (ie. lots of unneccessary improvemts that will prove costly.)

here’s the description of the improvements: “New roof, windows, bathrooms, kitchen, flooring, paint, doors, plumbing, carpet, appliances, recessed lighting, fixtures, electrical and more.” These guys also knocked down walls, re-did openings, delt with tree roots in the pumbling, and brand new fencing all around.

I’m guessing $70,000 for the renovation. that would only be a $30,000 profit at the current price. if the agent’s commission is 4%, that’s about $8000 in profit. less uncle sam and the governator’s taxation, we’re looking at $5000.

or did I price the renovation too high?

I keep forgetting how small this place actually is. I read a bit more of the flipper’s post in the investor forum. It looks like they were able to get the laminate flooring and carpet done for $3,000. But it also looks like they had a huge mold and asbestos problem (with the flipper inhaling some asbestos unknowningly during the initial heady days of ‘let’s try to do it ourselves’.)

let’s just give this flipper the benefit of doubt and go with the $50,000 estimate. which would translate to roughly $20,000 after tax, if they manage to sell for $565,000.