443 Las Tunas Dr.
Arcadia, CA 91007
| Asking Price | $775,000 | ::: | Sq-ft | 1,020 |
| Purchased Price | $600,000 | ::: | Lot Size | 0.26 acres |
| Purchased Date | 1/4/2008 | ::: | Beds | 2 |
| Days on Redfin | 23 | ::: | Baths | 1 |
| $/Sq-ft | $760 | ::: | Year Built | 1941 |
| 20% Downpayment | $155,000 | ::: | Area | Las Tunas / Baldwin |
| Income Required | $193,750 | ::: | Type | SFR |
| Est. Payment* | $3,918/month | ::: | MLS# | W08062891 |
*Estimated monthly payment assume 20% down, 30-yr fixed @ 6.50%
I actually referred to this property in a weekend post earlier in the month. Looking at the numbers again, I think the listing deserves its own WTF you-gotta-be-kidding-me post.
Location
I drive by this property every other day. It’s located just East of Baldwin Ave. where, although traffic isn’t heavy, cars constantly blow by it at above-average speeds. Right down the street is the Big Lots and H.K. Cafe shopping plazas. I wouldn’t say it was a bad location, but it’s not anything stellar either.
Property
For $775,000 you’re getting a 1,020sf 67 year-old home. At $760 per square foot, there is no question that this listing is way overpriced. As an extra bonus, this property comes packaged with the “EXTRA AMENITIES OF WORKSHOP, GREENHOUSE AND ENCLOSED PATIO.” Personally, I don’t have a green thumb so I don’t quite understand the benefits of a greenhouse. But hey, there are probably folks out there who would really appreciate one.
Purchase & Financing
This property was purchased in January of 2008 for $600,000. No, that date wasn’t a typo. After holding onto it for just under 4 months, the owner has now put it back on the market for $175,000 over his/her purchase price. There was a 10% downpayment that was most likely required by the lender. I’m certain the buyer would have gone 105% financing if they were allowed to but someone forgot to inform this flipper that we’re now in a housing and credit crisis.
Not only is the $775,000 asking price ridiculous, I am amazed at what kind of profit this flipper is trying to make.
Downpayment – $60,000
Loan amount – $540,000
Asking Price -> $775,000 – $60,000 – $540,00 = $175,000
I deal with extremely risky real estate investments and a projected 30-40% return is already very tempting to my investors. Based on this flipper’s $60k investment, he/she hopes to make a 290% return in just 4 months!
This flipper is so daring and smart – he skipped the pergraniteel face-lift phase and directly jumped to profit taking.
Let’s smack him with a 2×4. Wake up.
I’m not familiar with this area but… If I was smart enough to have save $155,000 for the downpayment and make $200,000/yr I wouldn’t put my family in a 2 bed 1 bath 1K sq ft box!!! Where this seller thinks he is going to find any buyers????
I have a theory on what the seller had in mind. The seller probably bought this property because of the large lot for development. Maybe, he was thinking of splitting the property into two to build two houses on it. I’m not sure about the numbers but if two new houses cost $600K to built then that would only be $1.2M total. He might be able to sell each house at $800K or more, which would give him a profit of $400K or more. I think the City rejected his proposal or he couldn’t find any investor. I have seen some of these in other cities. I saw a listing in Rosemead that falls into this scenario. The seller got the permit to separate the property and even have the plans to develop two new houses. But, he is currently selling the split lot separately for a little less than $400K each, which would cost the same ask this asking price.
“he/she hopes to make a 290% return in just 4 months!”
I think he/she may end up loosing all of the investment and then some.
StillWaiting,
I have definitely seen many investors go the route of splitting up a property into 2 parcels. This may have very well been the original intention.
Unfortunately, many uninformed ‘investors’ don’t understand how the process works. Just because an area is zoned for higher density doesn’t mean the City will blindly allow you to cut up lots into multiple smaller ones.
Unfortunately for this guy, the lot is narrow and no other properties on his street have been split up!
http://www.redfin.com/CA/Arcadia/443-LAS-TUNAS-Dr-91007/home/7238878
That “enclosed patio” as all the charm of a 1970’s office building.
This seller won’t be able to move this property unless she finds a knife catcher who is clueless about the housing market crash. Good luck.
This is too funny. Who’s dumber, the seller or eventual buyer?
Just goes to show you there are plenty of knife catchers and risk takers still out there.
A sure sign we have a lot more to drop.
Flipper-man he greedy — I say GREEDY!
He no chop my dollar!
He no make my money disappear!