Tuesday, May 13, 2008

"freeway access nearby"

Remember 2937 Delaware Ave. in SM (south of Olympic, east of Stewart) last September (lower arrow in photo)? It was a nice 2 bed / 1 bath house, priced well for sale at $720K, despite being just a block north of the freeway. It sold quickly for $757K.

Then there's the new 3 bed / 1.75 bath listing at 3003 Delaware (upper arrow), asking $989K, described as:

"Quiet tree-lined street on corner lot. 3 beds/1.75 baths. Family neighborhood, walk to park and stores and freeway access nearby. Newer kitchen w/ granite countertops opens to landscaped front yard. Bright & spacious w/ high ceilings in family room. Generous backyard with covered patio and extra storage near the garage...."

Guess it's all in how you define "quiet". Not much traffic on Delaware, but you sure hear the freeway! Is that extra bedroom and 3/4 bath worth over $200K?!

Get the price wrong and you sit. The 3 bed / 2 bath across the freeway at 2124 Yorkshire Ave., reduced slightly to $1,035K, is unsold 250 days from first listing. And the 2 bed / 2 bath foreclosure next to the freeway at 3121 Urban Ave. is down to $799,900 at 67 days.

18 comments:

Anonymous said...

Point well taken westside, but there is so much pent-up demand right now for SFRs under $1.5 mil and under $1 mil in West LA, that I do see this selling eventually at close to this asking price.

Also, West LA prices have proven extremely sticky, the price declines happening elsewhere only touched the condos in West LA.

pop said...

pent-up demand right now for SFRs under $1.5 mil and under $1 mil in West LA, that I do see this selling eventually at close to this asking price.

WTF is "pent up demand"? Really. Used house salespeople use it a lot lately. Is that on the NAR talking points hot sheet?

Anonymous said...

i am a bear

and i am hoping for price declines

however the SFRs under one million, no matter how skanky, seem to be selling

i am befuddled but it is happening

pop said...

I'm sure things under a million are selling. That's all people can get financing for. Here's a note from a mortgage broker in L.A. that I think sums up our present situation pretty well:''This is like people walking around on Godzilla cause they can't see it's even there, just feels funky hilly, squishy and bumpy and rumbles some but it's certainly nothing to get alarmed about.

Who knows how this eventually plays out but I can tell you that we're getting loans shredded right and left from underwriters, it's a battle on files that would have sailed through a year ago and they have the computer models set to "we don't care about ability to pay, only credit matters", once they get to worrying about ability to pay there will be no one left to borrow.

This will be horrific, not just bad, but worse than anything anyone alive has ever seen.

Anonymous said...

Really, so many people on this blog and other bubble blogs are saying the same thing for almost 2 years now..."it's going to drop on the west side - just you wait - people who are buying now are idiots...blah blah blah" But as someone who has been waiting to make a smart move and keeping my eye on the market for 2 years, i gotta tell you guys that it's just not happening. ANYTHING decent in the 800-900 range in santa monica, venice or mar vista sells pretty quickly. check out 825 warren ave in venice. A block off lincoln...small house sold in first 2 weeks. 879 asking price. this blog always highlights awful houses in terrible locations, but doesn't talk about the decent ones that go quickly...

pop said...

But as someone who has been waiting to make a smart move and keeping my eye on the market for 2 years, i gotta tell you guys that it's just not happening.

Well then, you should just stop reading all this negative stuff and buy a house! Hurry!

Look, it's happening. Maybe not as fast as you, or I for that matter, would like, but inventory is high, sales are slow... 10 years of "RE never goes down" mindset ain't gonna go away in a year. But it *will* go away. And if you don't think that's true... buy a house... they're cheaper than they were last year. ;-)

Anonymous said...

... and might be even cheaper next year ;-)

Anonymous said...

I'm frustrated too, been watching the 90403 for SFRs and can afford up to $1.2, but the prices there never went down and it's still $1.5 minimum for very marginal, teardown quality shacks.

No one is buying these, mind you, but the prices aren't falling either. There's nothing at all listed under the $1.5 price point.

Condos, on the other hand, definitely got whacked some, as I've seen and as this blog did cover.

pat said...

I live across the street from 3003 delaware. I've been here for 25 years. It's a nice street in a very stable neighborhood. I love it here. Yes the freeway is two blocks away but it doesn't bother me.
The house is lovely but kinda small.

I'll be selling in June of 09 so I hope prices stay up

Anonymous said...

I wish the SM prices would come down....but no, they haven't....not for a well located, SFR...even the tear down are more expensive than last year.

Real Estate is local ,friends, supply and demand, location, location, location...all serves to keep SM high.
Bummer....but I can get a lot more condo for the $$$$. But i think condos are not a good bet in general.

teddy said...

It's amazing. There are about 8 - 10 homes in the Highland's section of PP for around 3 million and none of them are selling. ( some are not in the MLS) Most of the homeowners have HUGE profits from their original purchase (see REDFIN.COM) Some of these homes have been on the market for over 6 months. How can this workout? Any new seller in that range would be stupid to put his house up for anything but significantly less and then what will happen the the old listings. Also, who wants to pay anywhere near these prices with so much inventory. Plus many of these homes have big HOA dues attached to the monthly payment. The problem, in part, has to be with the real estate brokers wanting to get a listing and telling the homeowner's they can sell for some unrealistic amount. Stay tuned.

Anonymous said...

These "teardown quality" 3BR starter shacks in 90403, which are asking minimum $1.5 million in that zip, used to go for $700-800 just six or seven years ago. It's amazing how high it went and how their prices just won't go down one bit.

I still think they will though, this is the lull at the top of the roller coaster when it crests the hill and slows to a crawl, before it plunges. I think that because all these $1.5 mil teardowns in 90403 are just not selling. There is no demand for them at that price. At some point the sellers in 90403 will get out of the denial stage and enter bargaining, and prices will finally move.

Bartlett said...

"Real Estate is local ,friends, supply and demand, location, location, location...all serves to keep SM high."
-Anonymous 5/14/08

"Stock prices have reached what looks like a permanently high plateau. I do not feel there will be soon if ever a 50 or 60 point break from present levels, such as (bears) have predicted. I expect to see the stock market a good deal higher within a few months."
- Irving Fisher, Ph.D. in economics, Oct. 17, 1929

Anonymous said...

There is a segment of the population that wants to live in Santa Monica, that can afford a house in the 1.0 million range. As these properties become available, they will be snapped up, regardless of the national housing crisis. The prime Westside of LA is not the same as Florida, Arizona, or the San Fernando Valley. You bears can wait for as long as you want......but as the slim supply of decent properties trickle into the marketplace over the next few years, they will be bought up at the 'affordable' (sorry to say, but for many current buyers $1million is affordable) current prices.

Westside Bubble said...

but as the slim supply of decent properties trickle into the marketplace over the next few years, they will be bought up at the 'affordable' (sorry to say, but for many current buyers $1million is affordable) current prices

But SM prices did fall ~25% 1990-1996.

Tighter financing, a falling economy, and changing expectations result in rising inventory (which we're seeing) and falling prices (still resistance there).

Yes, people now are eager to buy when prices fall. Will they be as eager and ready deep in a recession?

Anonymous said...

Man, people have become too CNN-ized and want their news to happen now. Just give it a few years -- the housing slump won't be done for at least 2-3. You'll see the Westside fall too, just be patient. After all, the 90s slump wasn't over in a year.

Anonymous said...

So are you saying that we need a deep recession to see a significant drop in prices here? Maybe we will, maybe we won't. I don't think the 1990-96 price drops are that useful a lesson for today's real estate scene. Let's remember that the demographic for current buyers is very different than it was 10-15 years ago. Those buying today typically earn a lot more $ than those in 1990-96, that's how they can afford the inflated prices. Secondly, there are more of them. Santa Monica is more desirable today than it was then, and many of the noMo buyers are being forced into buying 'starter homes' in Sunset Park. Thirdly, there are fewer sellers, either because it is so expensive to move elsewhere, or because they want to wait out the price correction for a few years.

Low turnover and high demand on the quality properties will keep prices stable for 2 years or more.

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