Address: 942 26th - 90403
Details: 3 bed/3 bath, 2,477 sq ft house on an 8,329 sq ft lot. Totally flipped.
Description: Mediterranean masterpiece located in prestigious Franklin School District North of Wilshire, just 1 block south of Montana. Completely renovated & expanded from the ground up, this major remodel
was finished with full attention to all the finest details! All new
Viking appliances, granite counters, Travertine floors, top designer
lighting. Master suite boasts professionally finished his & her
walk-in closets, spa tub. Fountain in courtyard, fruit trees in back.
Detached 2 car w/ enclosed storage
Previous Purchase: 10/31/05 - $1,549,000
Listing History: 1/19/08 - $2,295,000
The listing agent for this flip is the owner as well. Where is the disclosure?...or is that only in "private" remarks?
Holding
costs for this have been over $250,000 and construction costs are of
course a big question mark. Granite, travertine, and stainless steel
are cute but paying $2.3M to live on a very busy street seems like a
tough sell. Remember, these folks just cut their price down to $1.8M for their 90402 tear down on 26th and it still hasn't sold.
This
is another example of an agent/speculator/flipper trying to exit the
market. These are the folks who have driven the market the last few
years. Do you think they will be back to buy up new properties anytime
soon? Without their constant bid, will values rise or fall? And as they
all simultaneously bail on the market, will that help prices or hurt
them?
Where are the bulls now? Where are the buyers willing to
pay $2.3M for a south of Montana house on 26th? Where is the disclosure
that the agent is the owner?
Sunday, January 20, 2008
Another Agent Owned Flip Attempt
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28 comments:
I recall this house being on the market a little over a year ago, but there is no transaction listed in Zillow.
"... just 1 block south of Montana"
Yeah, right. It is actually almost two blocks, and is near the traffic circle at Washington. GOOD LUCK!!!
"The listing agent for this flip is the owner as well. Where is the disclosure?...or is that only in "private" remarks?"
You are beginning to sound a bit childish on this -- it is not listed in MLS Guest version and it is not in private remarks, it is listed if your information comes from an agent version of the MLS. It doesn't have to be disclosed in "description" of the property but it must be disclosed in the TDS. In reality, what is the difference who owns the property? You either like it or you don't.
In this particular case this listing is a FSBO. Owner, who has a real estate license, is a developer and not a practicing real estate agent. He purchased this property (represented himself on the purchase side) on 10/31/05 @ 1,549,000. He did some remodeling, repainted it, gave the exterior “Mediterranean” look and the claim about increased square footage is questionable.
Looks like we have the actual agent posting a comment right above me. So, do you think you will make a profit on this?
anon/owner @ 3:53 PM,
You're screwed.
jon & tyrone - I am an agent but not the "actual" agent.
this house is a dump
good luck schmuck
I deleted the last comment here because I am not going to tolerate people coming on as "anonymous" and then swearing at/insulting others in a baseless fashion.
If you are critical of agents or anyone else for that matter it is fine, but please do it in a tasteful manner which may add some value to the discussion.
anon (agent), it is not childish to feel that there should be disclosure made in public descriptions of properties...and I will continue to demand disclosure when it is not provided. Many individuals look at properties online and may not have an agent to give them the info that a property is agent owned. I think it makes a difference and all buyers should know. One of my biggest gripes with real estate is the lack of transparency. If agents and those in the "industry" want more respect and want others to view them as "professionals" they should support increased disclosures and transparency.
To those of you critical of this listing, I have not gotten a chance to take a look but I know the location well and it is obviously not a good one. As we have seen with other properties, marginal locations have been hit hardest so far so it will be interesting to see what happens here. And has anyone else noticed that nobody in this city knows how to drive through those traffic circles. Maybe all SM residents should have to go to England or Spain to learn how to deal with these things!
"I will continue to demand disclosure when it is not provided."
Wow. Please share your thoughts - what diference does it make who owns the property. Please be specific.
Warchest -
Can you clarify your call for "disclosure"? Not sure that I either agree or disagree with you ... I'm all for more information, but in the case of an agent-owned property, how would the provision of information help me, or more importantly, the absence of that info hurt me?
Wall St analysts, for example, have to disclose if they hold positions in securities they cover. That makes sense - you can certainly argue that if they own the stock, they have a vested interest to increase demand for the company's shares.
In the case of housing ... say an agent owns a property. If you're saying that disclosure makes sense because a potential buyer could see that there is theoretically a reduction in the commission paid, maybe that makes sense. If I know an agent owns a place, am I more likely to think I can bid lower because that agent technically isn't getting a commission? Maybe. Otherwise, there's plenty of public info out there on comps, prior sales, etc to help me make a decision.
Other than wanting, for selfish purposes, to low-ball agent/owners out of spite (the seller's agent on my former property in SM showed up to the closing in a red Ferrari, yes I harbor bitterness still), not sure that I care ...
Interested in hearing your perspective.
Thx
people like to know the seller is an agent because of freakanomics
if you read the book you will see that on average agent owned units sell for higher prices than non agent owned
basically, the message of the book is that you should avoid agent owned houses
simple - if an agent owns it move on
read the book
did you read the recent post on westside bubble
raw land in the sand section of manhattan beach - not on the beach and not with water views,
is now selling for 1100 a square foot or more (jan 08 prices)
vs 250 a square foot in 90402
it makes 90402 look crazy cheap
in comparison
why oh why the huge gap ?
This is the best blog I read. Highly informative and often entertaining.
I would like to see more info about the Ocean Ave. condos north of Wilshire.
"on average agent owned units sell for higher prices than non agent owned"
You just gave the reason why you should use practicing real estate agent to represent you when selling your property.
Allsouledout,
When it comes to disclosure, it is required by law to disclose if seller has re license and if they are listing agent as well but it does not have to be disclosed in MLS property description or any marketing materials. If you call that agent/seller and just ask, they have to disclose it, even if they are not listed in MLS and are selling it as FSBO. This does not take away or add any value to the property itself, it may change the way you write an offer and negotiate the deal but that is it. Personally, I think agents and sellers who represent themselves are making a mistake because of the conflict of interest and a loss of a third party negotiating power.
I would love to read warchetsm’ analogy.
actually,
the book shows that if you hire an agent to sell your house for you the agent will be lazy and sell it for less than the agent could have sold it for if agent was working hard.
If the same exact house is owned by an agent and the agent himself sells it it sells for more, because the agent works harder to extract a higher price
This is in the bestselling book, proven beyond all doubt.
The message of the book is that if an agent is selling his own house, you should not look at it - if an agent is selling a client's house you will get a lower price.
The book says nothing about whether an individual should hire an agent or not to sell his house.
look it up - you can read this for free on amazon. book is freakanomics.
I repeat, the book proves that you should not buy from an agent selling his own house
no apology is due from warchest sm
"no apology is due from warchest sm"
ANALOGY not APALOGY, I guess that sais it all about reading books, blogs, politician statements, stock analyses, etc.
Book said it and proved it, amen to that. What else have you been reading?
Sorry for the typo, "says" and not "sais".
Anonymous @ 1:45:
"This is in the bestselling book, proven beyond all doubt."
This is a technicality here, but the statistics shown in Freakonomics merely demonstrate correlation, not causation.
A powerful correlation that doesn't exactly support your assertion that "agents are lazy," but that does beg you to ask the question, "How much should I trust someone who will gross min $15k from my sale?"
And, undoubtedly, many agents were willing to mislead buyers (or they didn't understand the market) about the idea that "real estate never drops." Which makes them part of the problem.
I have read the book
carefully
the book makes it crystal clear that the realtors sodomize their clients.
Read the book. There is no amiguity there.
"the book makes it crystal clear that the realtors sodomize their clients."
There is no law that forces one to use the realtor in either the sale or the purchase. Just DIY.
One question: Don't real-estate agents--the seller's agent; the buyer's agent--have a fiduciary interest to represent the seller, since the seller pays the commission?
Maybe someone can explain the facts about this.
Of course, the buyer should treat the seller's agent with caution given the issue of who
s paying the agent.
But the buyer also would seem to need to be careful not to accept at face value what the buyer's agent says given who's paying the buyer's agent's commission.
Caveat emptor.
"Don't real-estate agents--the seller's agent; the buyer's agent--have a fiduciary interest to represent the seller, since the seller pays the commission?"
Seller's agent - yes.
Buyer's agent is not a party to a listing agreement nor the purchase agreement and does not have any kind of commission agreement with the seller. Commissions are paid by the listing agent, as per MLS, to buyer's agent. Buyer's agent has fiduciary interest and responsibility to buyer only. This is clearly stated in a Disclosure Regarding Real Estate Agency Relationship (CAR Form AD), which is the a very first form all buyers have to sign prior to signing an offer.
All of this is true.
Everything posted in this blog is correct.
Just be aware of the following.
If you are shopping for a home, and you see two homes you like, both being represented by agents, and one is owned by that agent and the other is not, you will on average wind up paying more for the agent owned house
this is not evil it is a fact of life
the book proved it
if you can, avoid spending your time looking at agent owned houses
the agents who own their own houses will extract more money from you.
Anon 8:57 AM
Have you read the book "Armagedon"?
it should be noted that the very same agt. (Peter Mullins, AP Real Estate --public record) who sold 2606 Highland Ave in aug. for 3mil. has three of his own props in foreclosure coming up to trustee sale this month.
a look at the first is instructive: 807 Navy st. purchased for $925K in 2002. that's right, folks, a 2700 sq ft lot with a 468 sq ft shack on it next to a used car lot on Lincoln blvd. sold for $925K in 2002. the house to the west of it, 3 times larger, sold for ca. $550K in 2003. (now a monster house is on Mullins' prop.) He now has $2.3 million of debt in 5 mortgages on 807 Navy st. (public record).
let's look at all who stood to benefit from this sale--one must assume it was appraisal fraud, but then the appraiser would never work for Mullins again if he didn't comply. then the mortgage broker, whose percentage is based on the size of the loan. and Mullins himself, who benefitted both by getting cash out of the loan to buy more props, and as a real estate broker--bu INFLATING THE COMPARABLES.
and here (in many other transactions), in my opinion, is the only reason prices could have escalated as they did after 2003.
942 26th st was purchased by Mehrdad Sahafi on 10.31.2005 for $1.549 mil. according to public record, he sold it to himself 7.17.2006 for $784K. this is all public record.
what's happening here? an attempt to defraud the city of property taxes?
any other ideas?
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