Thursday, July 17, 2008

West LA TV flip house

I saw this house on a TV house-flip show last week. After an intro highlighting the Westside with images of Santa Monica, the general plot line was a contractor and his wife bought a West Los Angeles 1-bedroom tear-down pretty cheaply ($525K on 9/7/07 per Zillow, built 1937), stripped it to the floor and one wall, and built more foundation and a new house on it. Drama came from rain delaying construction and losing construction financing, resolved by the extended family chipping in to finish.

The climax had a real estate agent say he would list it for $1.05M (I think I recall). But the end titles noted there had been no serious offers. So where is it? It wasn't in the MLS, but I found this listing via Google, and recognized the TV agent's name, Zan Sacker, for this 3 bed/2 bath at 2617 Corinth Ave., asking $974,999:

"PRICE REDUCED!!! Stunning All New Contruction Craftsman home as featured on the hit TV show "Flip This House". This never lived in before Cul de sac home is appointed throughout with the highest quality Kohler fixtures, Pella dual pane windows, solid bamboo flooring, & slate flooring, travertine, Ceasarstone & granite counter tops. ..."

No MLS# in that listing (Why would you list with an agent that doesn't put it in the MLS?). But a newer 7/14/08 listing is now on the MLS, reduced again to $939K.

A couple of shots from the back yard showed a freeway bridge. Of course you don't see the freeway (separated only by a flag-lot driveway) in the listing photo. Why would you do a flip in this location??

31 comments:

allsouledout said...

Westside Bubble said:

Why would you do a flip in this location??

and

bought a West Los Angeles 1-bedroom tear-down on 9/7/07

Think you answered your own question there. I mean, like, c'mon, everyone was making money in real estate (which is like, sooo 2007 now) ...

Just goes to show how far some areas still have to fall. What's this house really "worth", even with all the great "upgrades"? Aside from the answer of "whatever someone will pay for it" ... I'd say $500k?

Richard Mason said...

Why not do a flip near a freeway? It may limit your final sales price, but presumably it also gets you a cheaper purchase to begin with.

If high gas prices are here to stay, then buying cheap property near freeways might be a smart long-term move. Once all the cars are hybrids, the freeways will be quieter and less polluted.

spurg said...

if this is the house i am thinking of it is indeed on a cul de sac. the reason the property was so cheap is that you are literally underneath the north west corner of the 405/10 interchange. I was wondering who would put this up in this location. the freeway noise is considerable. maybe with triple paned windows you could sleep...

Anonymous said...

Wow, "travertine" and "granite counter tops" are already red flags to stay away from a listing (because it means it's likely being sold by some dirty flipper), but this one even advertises that it's a flip! Horrible judgment in the description, no one's dumb enough to consciously buy a house from some flipper, it's a guarantee you're over-paying.

Sammy said...

OMG this is a horrible location! The air quality alone would kill you.

Anonymous said...

this house is in trouble due to bad location

i also think that some of the flippers north of montana are in trouble

i just spoke to a developer - he told me that it makes no sense at all for him to buy and develop north of montana

he said the standard lot will still cost him 1.9 and he will pay 300 a square foot to put in a normal house with 4000 feet above ground and 2000 feet of fully finished basement.

so he said for 6000 feet he is in for 1.8

so all in the house costs him 3.7 to complete and in today's market you might not be able to sell for 3.7

bottom line is he said the numbers don't make sense and he is going to stop bidding on lots north of montana


He further went on to say that for families that want a custom home, for home with all the high end finishes a family will pay 500 for all the hard and soft costs so on that 6000 square foot home they will pay 3.0 million plus the 1.9 for the land

so a family looking to build a 90402 dream home should count on it costing 4.9 million all in

1.9 for the land and 3.0 for all the other stuff

4.9 million

can any of the other developers and builders on this blog weigh in with how realistic what he is saying is -

just want to do a sanity check on this

Anonymous said...

I love how it says "no serious offers". Perhaps what is missing is a "serious price".

A "serious price" would be be what a family below the median income in West LA could afford for a decent home in an undesirable locale.

This is an insane price. A goofy price. A smoking crack price.

However, I am confident that someday soon, this home will have a "serious price". Of course by then the flippers will be seriously f***ed.

Anonymous said...

1.9m will only get you a lot in a marginal location NOM.

Anonymous said...

are the developer's numbers right

Anonymous said...

There's no need to build 6000 sq ft.

Anonymous said...

location is the pits. i talked with someone whose job is to research cancer in LA. "where is it the worst?", i asked. his answer: just superimpose a freeway map over the city map.

Anonymous said...

Speaking of next to the freeway: why are people still buying in Brentwood Glen, which is right next to the 405...with all of the cars that travel the 405, wouldn't Brentwood Glen be full of toxic air? A listing for $1,995,000 just went "Looking for Backup". I think people are crazy.

Anonymous said...

responding to the 90402 house quandy

yes i believe that most of the buyers of teardowns today, july 08 are families seeking to have a family home constructed

i think the scummy speculators are out of the game for now

Anonymous said...

Excellent piece in today's Wall St Journal about how smart buyers are downsizing to smaller yet higher quality homes, like 1,100 sq ft.

The smaller homes are definatly greener and make sense.

Maybe builders NoMo and throughout SM should focus on 1500-2500 sq ft homes? Sounds like the coming trend. Easier and faster to build and re-sell. It is time to stop all of this over consuming , which is ruining this country. Right sized instead of super sized.

Regarding the flip house: horrible location, likely respiratory problems for inhabitants, crime... I'll put $495,000 on it... Most likely will end up as a rental unit.

Anonymous said...

i agree with the poster that said that it would be better for the environment if houses were 1100 square feet

i am not sure how the numbers would work

i mean assume 500 a square foot for constrution that means the house costs 550k to build

buy land for 2.0 million in 90402 and then spend 550k on a house? doesnt sound right

doesnt sound like buyers would accept it

but yes good for the environment

Anonymous said...

i was just told that the general numbers south of montana are - buy the lot for 1.4 and spend 900k to build a house for total all in cost of 2.3 million

families looking for brand new in the 90403 are in that ball park


however in 90402, people expect much much more high end fixtures and finishes so count on buying the land for 2.0 and spending 3.0 on high end build out for total all in of 5.0

not 5.0 if it is a spect but 5.0 if a careful older person is custom designing the house

i would be interested in knowing whether this is true and whether the custom home people drop more than 2x on a 90402 vs a 90403

Anonymous said...

A carefully chosen $300 per sf can get a nice house built. The $500+ per sf category starts getting into exotic woods, fancy marbles, over the top tiles, venetian plaster etc. that maybe work on a large lot on Georgina or in Gillette, but seem out of place in a 4,000 sf house on a standard NOMA lot. High-end finishes can look particularly gauche when paired with McMansion architecture.

I think clean, green finishes will win out long term, and the granite/marble overload seen in spec houses will look so 2000's. The other route is the highly crafted jewel box approach, using super high-end $500+ sf finishes in a ~3,000 sf envelope.

Anonymous said...

"superimpose a freeway map over a city map"

???

Dude, I'm pretty sure the freeways are already on the map.

Oh, and I built a few custom homes in the Southbay and I would like to add that you can build something amazing for $300/ft. But that's cost. A design/build firm will add at least $100/ft to that.

Anonymous said...

just google "affordable family formation"

basically this theory says that in places where a house is affordable, young educated couples will get married at a young age, have kids, and the population of educated people will go up

in places where a house is very expensive, young educated couples will hold off on having kids and when they do try to have kids some of the couples will be too old to have kids and as a result there will be fewer kids on average - many single child families in particular

i see this phenom right now at work in SM - number of kids per couple seems to be very low due to lack of affordable SFR

Anonymous said...

"i see this phenom right now at work in SM - number of kids per couple seems to be very low due to lack of affordable SFR"

This is actually not true. The number of babies born in Santa Monica over the last three years is actually WAY up. I know this for a fact as we've had two, and the maternity wards are currently slammed.

There is talk of a new "baby boom."

Go to Douglas Park some afternoon and look at the line of parents for the baby swing... its crazy.

Anonymous said...

"i see this phenom right now at work in SM - number of kids per couple seems to be very low due to lack of affordable SFR"


Plain crazy crap. St John's maternity is busy as heck, and, as far as I know, Franklin and Roosevelt don't plan on merging due to forecasted declining enrollment.

Did the researcher study rural Utah versus top metro's? Nice theory for a grad student thesis, just not relevant to this board.

Anonymous said...

The above two posts are correct - plenty of kids in Santa Monica

that being said, the average couple i know that lives in a condo has one or no kids and the couples i know tht live in SFR have two or three kids

i think that if you took the couples in the condos and gave them all SFR's they would respond by having more kids

so yes, a couple that knows they have a SFR or can afford a SFR will have more kids a couple that knows they can never afford a SFR will have fewer

Anonymous said...

"i think that if you took the couples in the condos and gave them all SFR's they would respond by having more kids"

Then you, sir, are an idiot.

First of all, it isn't true. Period. The truth of the matter is that highly educated parents statistically have fewer children, and have them later in life. This correlates causally. First, it is difficult to pursue higher education while building a young family. Second, a dramatically higher proportion of highly educated households are dual income, making child-care more complex. And third, highly educated families tend to gravitate to urban areas where there it is significantly more challanging build a larger nuclear unit (due to cost, space, and other obvious factors).

But, more importantly, your absurd claim has nothing whatsoever to do with Afordable Family Formation, which you've grossly misunderstood. Affordable Family Formation is a GOP triangulation scheme developed by Steve Sailer in 2005.

The notion is that the GOP will always win in those parts of the country where housing is cheapm so it is in the interest of the GOP to leverage people into mortgages whether they can afford them or not, because to quote Mr. Sailer:

"Mortgage, marriage, and babies tend to make people more conservative."

The notion being, that long term mortgages beget long term marriages, and long term marriages beget babies, and babies beget Repunlicans.

To further quote Mr Sailer:

"[Republicans] are on the side of making it affordable for you, and your children and grandchildren, to get a mortgage and form a family. The Democrats want you to die alone."

And yet we wonder how the housing bubble was allowed to happen on the GOPs watch?

Anonymous said...

well i for one don't care about politics one way or the other

i am simply asking you to compare two young highly educated couples.

one couple is gifted a SFR in the franklin school district

the other couple lives in a two bedroom condo

the point is simple - the couple that is gifted the SFR at a young age will have more kids than the couple that lives in a two bedroom condo and that feels like they will never be able to afford a SFR

again- i don't care about the politics here i am simply saying you see a difference in the number of kids a young couple decides to have here in SM depending on whether they are gifted a SFR or not

Anonymous said...

"i am simply asking you to compare two young highly educated couples."

You lose me here. In order to be "highly educated," you can't be young by American childrearing standards. In America the average age of childbirth is 24.6 years old. Whereas the average age of a "highly educated" post-graduate, is 34.8.

This is the point of discrepancy. Not home ownership.

The average "highly educated" person waits more than ten years longer to start a family.

"the point is simple - the couple that is gifted the SFR at a young age will have more kids than the couple that lives in a two bedroom condo and that feels like they will never be able to afford a SFR"

This eliminates the above description specifying that these people are all "highly educated."

If you want to compare a family with an average level of education, or a mixed level of education, you've got a relevant point. But, the house becomes a largely irrelevant concern at that point.

"again- i don't care about the politics here i am simply saying you see a difference in the number of kids a young couple decides to have here in SM depending on whether they are gifted a SFR or not"

Not in the case of an apples to apples comparison.

Anonymous said...

I am not sure what you mean

a young couple that gets out of college at 21 and then goes on to law school gets out of law school at the age of 24. If they are married and working as lawyers at the age of 25, and are working in public interest law or environmental law or some kind of law that pays very little money, they will not be able to afford a SFR in Santa Monica

This 25 year old couple is done with their education - if they are gifted a SFR in the Franklin School district they will probably have two or three children

if instead they work until they are 33 to save up money for a down payment and get a SFR at 33 then they will have fewer kids.

This matches the experience of so many couples i know in Santa Monica - how can someone claim that the ease with which a couple can buy a SFR doesn't impact the number of kids they have ?

Anonymous said...

This matches the experience of so many couples i know in Santa Monica - how can someone claim that the ease with which a couple can buy a SFR doesn't impact the number of kids they have ?


What does any of this have to do with Westside Bubble, house prices, or when someone should buy?

Do SM RE values revolve around child-bearing angst? This string is off-topic and WAY too self-indulgent.

Anonymous said...

"a young couple that gets out of college at 21 and then goes on to law school gets out of law school at the age of 24."

I think that law is a "professional program" not doctorial level education... so I don't know whether everybody out there in the world considers that as highly educated...

Most of my highly educated friends weren't done with their educations until they were well into their thirties, which is consistant with the earlier poster's point. Somebody who is in school into their thirties doesn't start a family early.

"This matches the experience of so many couples i know in Santa Monica - how can someone claim that the ease with which a couple can buy a SFR doesn't impact the number of kids they have ?"

As another poster said, what is your point? If your running a political campaign this matters. If your trying to decide wheher the time has come to buy your dream house, this really is meaningless.

You keep running off on these wierd tangents that are not related to the subject of the blog... why?

Anonymous said...

I totally agree, who cares about how many children are born to SM homeowners.

And besides, having children these days is over-rated, and it isn't the GREEN thing to do anyway. Just creates more CO2.

Anonymous said...

that crystal chick is a total slut. i fucked her ass back in high school.

Anonymous said...

haw-haw