Tuesday, August 5, 2008

Knife Catcher Alert

Don't let this be YOU!

1474 Harness Ln in Norco was a leader. It was a leader in the foreclosure wave! Purchased in late 2004 for $600k by a Mr. Isidro Silva. This home is 3895 sq/ft with 4 bedrooms and 3.5 baths. It sits on a 1/2 acre horse lot. Poor Isidro lost the home to foreclosure in June of 2007. It looks like the bank got her back for $755k. I might be wrong but I bet Isidro has a new Denali and a a few other cool toys with that extra $150K. I suppose it could also be a Option ARM gone bad but those were not so popular in 2004 so it's more likely a HELOC or Cash out Refi that got the loan balance up.

Anyway back to the story. After the Trustee sale the home sells to a "bargain hunter" or possibly a shrewd investor back in Feb 2008 for $620k. Hmm fast forward 4 months and reality has set in, the fog has cleared, the light bulb has been turned on. Our buyer has realized he screwed the pooch and wants out. He has listed the home for $620k. The same as he paid. If this sells, after fees and holding costs he is looking at a loss of at least $50k (38K commision plus 5 months holding costs). in addition he probably paid 10k in closing costs when he bought the thing. OUCH!

But is he going to get his $620K? I doubt it. Why, well there are several model match homes in the same tract for sale for far less. There is 1211 Thouroughbred Ln. Same home listed for $532k. Interestingly enough, this home was also listed when our knife catcher bought 1474 Harness. But it was listed for $785K. I'm sure that helped convince the knife catcher he was snapping up a bargain. And if that's not bad enough there is 1504 Harness Ln. A mere 2 houses away this model match REO property hit the market only 3 short months after he closed, it is currently listed for $540k.

Being a knife catcher SUCKS!


anonymous said...

Have you ever considered detailing the condos in the area? There's the condo conversion in Corona Hills across from the Ashton apartments and several others in Corona done through 2004-2006.

I'm currently renting a 2bd condo at Sage Canyon over in the Sierra Del Oro area. It's currently listed for short sale. I am renting it at bargain basement prices due to the rare showing hassles. The funny part is it's owned by a realtor who bought the top and has held all the way down. She must have believed everything former NAR Chief Economist Lereah said. There's a dozen or more listed here with the average asking price of 199k and nothing is moving. Some people paid over 400k for these units just 2 years ago.

A major problem on the horizon for condos in the area are the HOAs. Here for example they have about 150k in back dues owed. Of course the HOA didn't exist long enough to build up reserves and they blew their wad like many others thinking the bubble would last forever, so they didn't manage their costs well at all.

As of now they've cut services to the bare minimum, drained the 2nd jacuzzi, cut landscaping and cleanup to barely nothing and cut the water for green areas down considerably. I'd imagine some of the condos around the area are in even worse shape.

Terry said...

You're definitely coming into your own voice, GX.

Sellin @ Da Drop said...

199k for those Sage Canyon FORMER APARTMENTS is laughable. 400k at the peak is hilarious. I rented a 750 sq ft bedroom with a view there for $800 a month for 3 years from 99-2002. They added marble, some wood trim and granite and called them condos shortly after. Those tiny apartments 400k condos. HAHAHAHAHHAHAHAHAHA!!! To the idiots that purchased them for even 199k..Suck it good.

anonymous said...

Sage Canyon - the 1 bd are renting around 1000-1300/mth. 2bd 1200-1500. Give or take 100.

They did a decent job on the conversions. New interior doors, new cabinets and nice granite in kitchens and baths if you opt'ed for the upgrades which it seems most did. It's a real nice area too. Some of them have very nice views of the area or back up against the canyon.

But, most owners here are in a jam real bad. Mortgage, tax and HOA on the the 2bd adds up to 2k or more a month. For a place that barely rents for 1200-1500. Most paid well over 300k, some over 400k and they're not moving for under 200k now.

The place has gone downhill drastically over the past 18 months. Some of the units have been on the market for over a year.

I might pay 100k for a 1bd or 130k for a 2bd but until those prices show up and until it's clear that the HOA won't need to add a cost assessment to owners which seems very possible, there's no way I'd buy here.

Rents in Corona are still way too high. I see they're coming down a bit. Over in Corona Hills at the Ashton/Marquesa/Promenade Terrace they were getting 1300-1400 for a well used subpar 2bd apartment back in 2006. Those complexes look nice but they have a ghetto atmosphere and residents can consider themselves lucky if their vehicle has never been broken into. I see they are now spamming Craiglists for biz and lowered their rents down by a couple 100. The condo conversion done on the apartments at the corner of McKinley and Promenade have to be totally screwed by this point. Some of those sold for 400k range at the peak.

Sellin @ Da Drop said...

They stole my car right in front of my Sage Canyon apartment on Del mar way. Nice area but back then it was not worth the 120 rent increase they wanted. When the car incident happened, it made my mind up to move on. So they added about max 30k in upgrades to each apt and tried to pass them off as 'Condos' for 200-400k LMFAO!!!! No thanks. I bought a house in 2002 for 210k 3 times the size. You can now do the same. Condos how a real bad track resale record. Dont do it