Crazy purchases still happening

[GoUSC]

About two months ago I made an offer on this house. The seller was asking $705,000 and I offered $640,000. My offer was turned down and the house promptly entered escrow the next week. Well it closed and the transaction finally hit Firstam.com. The buyer paid $715,000 ($10,000 OVER asking) and financed 100%!!!! How the heck does this happen? Especially over market. Any ideas?

http://homesbyjanna.com/address.php?property_ID=35

[SD Realtor]

It happens because there are still buyers out there. I feel your pain radelow. My lowball offers have been stomped on but it is what it is.

Things to note. That sale you pointed out was listed by a Prudential agent and the buyer was also represented by a different Prudential agent. Also it is not uncommon for credits to be given back for closing costs. I want the market to go down as well for my own selfish affordability. What is interesting about Piggington is that some people work very hard to find listings that “appear” to them to be fraudulent, or point out huge losses for sellers, or to identify flippers…etc…They like to use these individual cases to make a broad generalization that the market is dead now, that nothing is selling, and that this will lead to a broad based economic slump of our entire country. Now, sometimes there are individual cases that appear to be fraud and lots of cases of prices reverting back to 03, 04, or 05 pricing… However alot of times sdrealtor, or myself or other people find out the facts only to reveal that no, there was not anything fraudulent, the sale was on the up and up and the home did sell properly.

What you see is NOT an exception for certain areas. Now you or I wouldn’t pay a price like that for a home that small but someone did. We have no ideas if there were credits involved nor do we know the details of the transaction. We also don’t know if the realtor gave a credit back to the buyer although I would guess not because it was Prudential although you never know.

The depreciation cycle is not a overnight sensation. It will happen slowly in some spots, fast in others, and REAL slow in others. Hang in there radelow. Keep lowballing, get a good credit back…be patient.

SD Realtor

[SD Realtor]

One more thing… note that you said over market. That is speculative. They originally listed at 750k. Then they changed the price to 705k. Again though you do not know what sort of credits may be involved. Also Prudential is notorious for listing prices just to get traffic in, but that may be acceptable under certain conditions dictated by the Seller. I have seen Prudential listings with price spreads that were over 7% of the asking price of the home. Then we came in with a low offer and they said no we are really trying to get $X out of it. So the low end was there just for increasing traffic. For this property it may not be the case as there is no value range, just a base price.

SD Realtor

[GoUSC]

Thanks for your advice! Fortunately I am able to be very patient. I rent a great house in Bay Park and am in no hurry to buy a house. But I will continue to make undermarket offers (on the order of 10% or even more) and hope eventually someone bites. We shall see!!! 🙂

Your points are well taken. From my point of view it’s above market…but it closed so that makes it “market”!

[(former)FormerSanDiegan]

radelow – I think the desirable areas of Point Loma will be sticky for a while. Your Bay Park neighborhood is finally seeing some lower selling prices recently (probably linked more with Clairemont which has a decent amount of inventory, and more affected first). I used to live in BP and CLMT and want to try to keep a pulse on the rents and prices, with the hope of re-entering the market there at some point. (I sold in 2005).

How much are you paying for rent there these days (if you don;t mind) ? Or what are the ranges for typical props (e.g. 3/2 1500 sf no view, or 2000 s.f. with Bay views).

Any info is appreciated.

Thanks,
FSD

[GoUSC]

I have a 2000sf (4/3) house with a big backyard (2-car carport, no garage) for $2200/month. Has new landscaping and was remodeled. Although they did a crappy job on the details it’s a nice 20 footer. Aka everything looks nice from 20 feet away. Hahahaha.

I really would love to stay in Bay Park however the only time a house comes up is if someone dies (sad but there is a lot of truth to it).

[an]

I completely agree with you SD Realtor. I hope it’s going to be short and steep but it seems like it’s a cross between a crash and a soft landing. It is what it is. I’ll just be patient and save up until buying make sense again.

[Drew]

radelow,

I feel your pain regarding the rate at which Bay Park houses are coming on the market. You’re right about deaths leading to new listings, we know of one house that went up just down the street from my in-laws after the owner passed away last July, and its still on the market (asking price is way too high, imo).

My wife and I both grew up there and we sold our house in PQ last summer in order to rent for a few years before purchasing a home there. With the current rate in which prices are declining (read: slowly), we’re most likely going to start looking for a rental in the area this summer and hang tight.

$2200 is a decent price for that area, when did you move in? Also, what area are you in? (not looking for specific detail) up the hill or down closer to Morena Blvd? There are some houses up for rent that have insane asking prices and dont seem to be moving, so I’m trying to figure out what a good “counter” is.

Thanks

[GoUSC]

No worries…I am a block from the corner of Chicago and Baker on Baker. Not the canyon side so my back yard looks into the neighbors backyard. The owner of my house paid WAY too much ($700k) with the hope to flip after a minimal remodel. It sat on the market at $899k for six months with not one offer. I rented it about a year ago for $2000 a month. However I paid for 6 months in advance. Regardless, he is planning on holding it and I think plans to eventually move into it. We’ll see.

[PerryChase]

I too am interested in Bay Park. But like you guys said, there’s a dearth of listing in that area. I’ll be hanging tight and waiting until the price is right.

[kev374]

attended a seminar today and they were showcasing a new product to potential first time buyers that only requires $500 down and a strong credit history is optional.

[bayparkwatcher]

I’m another person who wants to buy in Bay Park. I own in an eastern suburb but work in the Morena District. At lunch, I drive around and agree with the rest of you…hardly anything is for sale. I saw one for-sale sign today but it was for one of those converted-to-condos 1BR/1BA. Can’t remember the street but I remember when they went on sale last year. They really had to slice the prices. Bay Park is such an ideal location no matter where you work.

[lniles]

Dang, you guys have caught on to my dream of living in Bay Park. We should all start making low-ball overs on everything there. The location is great: ocean/bay views, quick access to all the traffic corridors, no HOA, no mello-roos, and I 90% of my dining out is in Clairemont. I play vball and surf South Mission every week and have been eyeing the area for some time.

I see 44 detached and 101 attached Bay Park homes for sale in uniontrib. Prices range from $300k to $3M.

This one looks purty and others too.

http://sdhomesearch.signonsandiego.com/sales/Listing.asp?lid=2594-076027748

[PerryChase]

Looks like lots of people are looking at Baypark. Man, it’s gonna be hard for me to find something!

I would consider a fixer/teardown in Baypark, Point Loma, Bankers Hill, Mission Hills, or nearby, preferably with a view. I’m giving myself 7 to 10 years to find a suitable place at a good price.

[(former)FormerSanDiegan]

That’s funny. I lived in Bay Park for 5 years, and many long-time residents said “where’s that?” when I told them where I lived. I thought I had found a hidden gem.

(By the way, lniles, the linked property is really Old Town rather than Bay Park, but Juan street is nice, particularly as you increase the altitude.)

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