Remember too that the same person who paid $1.9 million for this house a year ago just lost this house, so I wouldn’t put too much “value” on what this person was willing to pay for the house in 06′. In addition to the ideas that Bugs presented, the buyer could have gotten caught up in a bidding war, or it could be fraud. Stop looking at it logically, buyers do some crazy stuff during periods of mania. You could almost look at this house as a parallel to the whole market and see that what somebody pays for something doesn’t mean it’s worth that.
