[lniles]

$1.05M may not be accurate because of the scandalous “cash-back” deals which are happening quite often. Sometimes the seller gives back tons of cash as part of the agreement after the sale closes. I’ve seen it for up to 9% of the closing price (a home lists as being sold for $700k but the seller gave back $60k so actually it sold for $640k). Just because the records say that place closed for $1.05M doesn’t mean it actually did. I wouldn’t be surprised if they actually got it for around $900k. Please tell your friend to ask to see the previous sales contract before he buys based on the assumption he’s getting a deal by comparison.

[lniles]

If you’re gonna buy in that area, check out the photos of this place. It looks like they’ve made a lot of sweet improvements to it inside and out! From the photos and the location I almost feel like it’s worth the $799k price they’re asking, but it might be a busy intersection (Ingraham and Missouri). The trees and landscape are really nice. Why not try a low-ball offer?

http://www.zillow.com/HomeDetails.htm?zprop=2146986029

[lniles]

If traffic bothers your wife, you might want to consider that a morning commute Northward on the 5 is far easier than Southward and an evening commute Southward is far easier than Northward. If you end up in Encinitas it’s going to suck for your wife getting to/from Sorrento Valley every day. If you live somewhere more Southern (PB for example) it might be easier for both of you.

Bay Park is just East of the 5 near PB with fairly easy access to the bay and bike/rollerblade/walking paths. You can also head East from there to some great restaurants and shopping in Clairemont. Bay Park has no mello roos and usually no homo asses (my argot for homeowner’s associations). Their houses range from cheap trash heaps to million-dollar, panoramic-bay-view homes.

[lniles]

While most news sites are reporting the “sharpest drop since ’89” check out the Union Tribune’s front-page article “Home sales post modest gain”

http://www.signonsandiego.com/news/business/20070425-0717-economy.html

Seems like an attempt at damage control to me.

[lniles]

Cheese doodles just shot out of my nose.

[lniles]

The first thing which comes to my mind that can be done about it is BUYERS: USE YOUR BRAINS!!! YOU’RE F’ING IT UP FOR US ALL!

[lniles]

Suspicious. I randomly selected 5 of the homes from that auction page and looked them up on zillow. They all turned up as “recently sold” within the past couple of months. I think this is yet another flipper scheme to run up some hype amongst dumb bunny buyers. This is pure speculation, but I’ll be it works like this:

1. Buy up some cheap homes, probably with the false-comp cash-back scheme discussed in another thread which makes zillow’s (and the assessor’s) sales history show falsely inflated prices.
2. Advertise some auction where the so-called starting bid is really low (lower than what it lists in the sales history).
3. Have an accomplice go to the auction and bid to make sure nobody really gets the place for a low price. Buyer dummies who show up at the auction might fall for these “planted bidders” and make bids of their own. Suckers!
4. The flippers make money from buyer dumb bunny.

Is there a way someone can look to see if any of these “foreclosure auction” homes are actually in foreclosure?

[lniles]

SDR You’re right, the address is 7943. Sorry for the wrong address posting before. And thanks for looking it up on the MLS!

[lniles]

Nobody who is here reading this blog (this far into it anyway) qualifies as “stupid”.

Let me drive by this evening and double-check the address again. But I know for a fact they sold it and moved because I live in the neighborhood and witnessed the for-sale/in-escrow/sold/moving-out and everything. I also know the inside scoop from the seller. Unfortunately I don’t have access to the MLS database and am relying on zillow.com for the comps and so on.

They may have listed it for $689k but their low-ball limit was $640k. They certainly did sell for $700k and give $60k cash back. He still made money, since he bought in 2004 I think. It went like this:

Fraud 101: House sits for sale for months with no offers and minimal prospective buyers.
Fraud 102: Realtor shows up with clients with the “cash-back” deal offer.
Fraud 103: The seller wants out and this is the only offer he’s received, so what the heck? He expected to get around $640k anyway and doesn’t care how stupid the buyer is for getting into this.
Fraud 104: Now all the other houses for sale in the neighborhood are using his $700k sale price as a comp!

[lniles]

Not a smart move on the part of the buyer, but as we already know some of the buyers out there are not using the best judgement. Unfortunately they rely on the realtor to do all the thinking, and all the realtor is thinking about is commission. He doesn’t care the the buyer will be stuck with greater property tax and a greater mortgage debt.

The house next door to the one I mentioned before is owned by people in “financial distress” and will likely sell at a loss.

[lniles]

I see. Yes, I was blown away when my good friend told me about his home selling experience and the $60k cash-back deal. BTW the realtor recommended the lender and the appraiser. I would not be surprised if they were somehow in cahoots. The address of that home is

7947 Prairie Shadow Rd
San Diego, CA 92126

Although it is closed, the sale isn’t listed on zillow.com yet. The comps are, and guess what? They’re about $700k. Exactly the jacked-up price not deducting the $60k cash back (so I know for a fact the home sold for $640). This is my ‘hood and I own my place (since ’99) so I should be happy about it but I’m not.

[lniles]

Alex_Angel: I’ve moved our discussion to
http://piggington.com/false_comps_fraud#comment-29002 if you wish to comment. I’d like to try and get feedback from other people who have experienced this so-called “not-the-norm” tactic. Already one other poster has experienced this as well. Let’s see if there are more.

[lniles]

They’re in it for the money and the higher the closing cost the higher their commission.

If the comps are wrong, where else do you go to get a fair assessment of the value of a home? Zillow and all others use the assessor’s info and the sales history. I know the false comps didn’t cause the run-up in the market, speculation did. The run-down of the market on the other hand, is definitely being delayed by these false-comp tactics. I don’t know if it’s the “NORM” but 3 out of 3 friends of mine who sold their homes in the past 2 years had this happen. All different agents. All in Mira Mesa. What are the odds of that? IMHO it’s enough to discredit the sales and assessor’s records, which are used for all our “median housing price” graphs and calculations (I.e. things are much worse off than even piggington.com followers believe). I will also be avoiding the use of comps in the future when I buy a house.

Please post if you know of others who have been approached by realtors with these tactics. I’m curious to see how widespread it is.

[lniles]

That’s true; however, there are buyers out there who I wouldn’t call “dumb” but who were influenced by RE agents and neighborhood comps… To me, RE agents are like the stereotypical used car salesmen who at times are able to make lemons sound like Bentleys (they’re even making this original poster think that houses are “selling fast” and being “out-bid”). Some people can see through this, some people can’t. If the comps are wrong as well, where else do you go to get a fair assessment of the value of a home? Zillow and all others use the assessor’s info and the sales history. I know the false comps didn’t cause the run-up in the market, speculation did. The run-down of the market on the other hand, is definitely being delayed by these false-comp tactics. I don’t know if it’s the “NORM” but 3 out of 3 friends of mine who sold their homes in the past 2 years had this happen. All different agents. All in Mira Mesa. What are the odds of that? IMHO it’s enough to discredit the sales and assessor’s records, which are used for all our “median housing price” graphs and calculations (I.e. things are much worse off than even piggington.com followers believe). I will also be avoiding the use of comps in the future when I buy a house.

[lniles]

What do you mean they’re being out-bid fast? I live off of Calle Cristobal (the North-West area of Mira Mesa, probably the most desired part of it) and houses as well as condos have been sitting for sale for MONTHS. Where is all this “fast” bidding taking place? A side note: I have personally experienced one of the sleezy tactics realtors use to drive up prices. They “close” at above-asking-price but they have an agreement with the buyer that they get cash back after the sale. For example, my neighbor wanted $640k for his house, the buyer and his sleezy agent came in and offered $700k with an agreement that the seller will give $60k cash back after the deal. That way, the buyer gets an additional $60k loan from the bank (that he wouldn’t have qualified for if it wasn’t a home loan), the seller gets his asking price, and the comps in the neighborhood go up because it closed on record at $700k. Thus, THIS IS A REALTOR-DRIVEN MARKET AND EVEN THE DATA YOU’RE GETTING FROM THE ASSESSOR’S OFFICE IS FALSELY ELEVATED.

[Author]

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