The Biggest Loser

There are a lot of homes in the IE that have lost 50% or more in the last couple of years. Most of those though are "only" losing $300K to $400K. It's not every day you find a 50% loss that is nearly a million dollars.

Well, here's one in Corona. 1015 Lowry Ranch Rd is a large estate home up in Crown Ranch. According the the description this was a model home. It is 5400 sq/ft and has 5 bedrooms and 5.5 bathrooms. The home was purchased new in May 2006 for 1.83 million. It does not say that this is a REO on the listing but I will assume it is as it shows a sale in June for 1.49 million. It is currently listed for $875K. That is a loss of 53% or $955K! If it sells at that price the total losses after all the fees are paid should be well over a million.



If you are thinking this home is going to be "snapped up" you might want to take note that there are quite a few REO properties in this tract and some are priced very close to this one. In fact there is a model match at 960 Randall Ranch Rd. This home is identical except for the "model home" upgrades. It cost quite a bit less so the loss is not nearly as impressive but even so the loss is considerable. It was bought new in June 2006 for $1.475M. The lender took it back in Nov 2007. Since then they have been chasing the market down. After 6 price reductions they are down to $878K. The loss on this one is "only" 41%, assuming they can get it sold at that price the loss is going to be around $600k plus fees..

The newest members of the 600k and 700k clubs

I thought ya'll might be getting tired of all the "news" posts. So let's take a step back and let the hilarity resume.

For your amusement, I present 1180 Cleveland Wy, Corona Ca. This a a large one story home up in the Amberhill area of Corona. The home has 6 bedrooms, 4.5 baths and is 3808 s/f on a .65 acre lot. It has a few whistles and bells such as a pool and fancy outdoor BBQ/kitchen. It looks like a nice house but with 6 bedrooms in 3808 s/f it might be a little crowded and I expect those bedrooms are on the tiny side.

The home appears to have been built in 2003 and it does not indicate what the original selling price was. It sold Jan 2006 for 1.4 million. That might have been the original price as it states this was a former model home. If my math is correct that's a whopping $367 a sq/ft. The big spender was not able to keep up the payments and the bank now finds itself as the owner of this property (The foreclosure amount is also not listed). It just hit the market for $787,500. That is a 44% drop from the last sale or a loss of $612,500 (plus fees). Making this home the newest member of the $600k club!

The Newest $700k club member is in the same area as the last home. 1015 Lowrey Ranch rd is in the Crown Ranch estate. This home qualifies as a mansion with 5 bedrooms and 6 baths in just over 5400 sq/ft. It sits on a .8 acre lot. Other than the zillow aerial shot there are no pics so it's hard to say what condition it's in but homes like this are not usually trashed. This one was also a previous model according to the short and useless description. This home is a short sale and as such may or may not actually be approved at this price. The home is listed for 1.12 million and it sold last in May 2006 for 1.83 million. If the bank were to go for this price the loss is $710k plus fees.

The advantages of not buying at the peak

here's a story of three identical homes. Two were bought near the peak and one was purchased a couple of years before the peak.

Our most recent purchase is 1645 MONTE MAR ST, Corona, CA 92881, This 3486 sq/ft 5 bedroom home was purchased Feb 06 for $913K. This gave the original owner a healthy profit of $439k (less fees) in only 2 1/2 years. Yea, no bubble here! After only a couple of years the current owner has decided to sell and is seeking $999k. Looks like he did not get the memo about the bubble popping. (sorry no pics yet). This is another Realtard that just listed this home when there is an identical model home around the corner listed 30% less. WTF??

Just around the corner but on a better lot is 3940 Via Miguel ST, Same house but on a better lot (no house behind) and it has a nice canyon view. The back yard is well landscaped and it has a pool and hot tub. This guy picked up his home in June 05 for $850k. This gave the original owner a payday of $370k in just 17 months. He has listed his home for the ambitious price of $860k.



The problem for the first two homes is an original owner at 1686 Anacapa CRK. This home has the best lot of the three. It sits on a cul-de-sac with a nice canyon view out the back. The back yard does not have a pool but it's nice with a bbq, fire pit and patio. This guy only paid $450k back in 03. He should have plenty of equity unless he refi'd and cashed it all out. He missed the big paydays the first two original owners got but if he can get his $699k asking price he still stands to make a healthy profit. Obviously the first two have no chance of selling with this home priced $300k and $250k less than the other 2. Sadly this home has almost no chance of selling either. There are similar homes nearby for far less. I think this home will need to come down another$150k to $200k before it has a chance.



Just for kicks lets take a look at what you would need to buy this home at it's current price and using traditional lending standards.

Price: ...................... $699,000
Down payment needed... $140,000
Required income.......... $175,000/yr (yea, the IE is full of couples making $175k/yr)

financing $560k 30 yrs at 7% (ave jumbo rate) = $3725/mo
Taxes in this home 1.8%, 12,600/yr .............$1050/mo
Insurance 200/mo

Total monthly payment would be approx $4975. Which is fine I guess if you are making $175k/yr. Even at that level of income this home would eat up a large portion of their take home pay though.

Corona Hills goes KABOOM

Up in the hills of Corona, when it's real quiet, if you close your eyes and listen very carefully you can hear the sounds of people crying. One such person lives at,

3311 Quartz CRK, Corona, CA 92882. He purchased his dream home in November of 2005 for $869k. He quickly tired of the home or a more likely scenario is that his reset was approaching. He lists it for $895k back in May, hoping to escape without losing too much. It was not to be however, and after a few price cuts he is down to $815k. Poor fella, what's making him cry though?



Well, it could be 3350 Cashel LN, Corona, CA 92882. This home is just around the corner and it's now listed as an REO for....drumroll please........$530k! This home sold in late 2006 for $890k, the bank got it back a short 11 months later for $760k. I'm guessing 1st payment default on this one. This home, if it sells at $530 will have dropped $360K in just over a year. That's 41% in one year!



As if that was not enough there is another home of similar specs in the same tract up for sale.

1160 Athlone LN, Corona, CA 92882. If this one is not a REO it will be soon. The listing wreaks of desperation. This one is listed at $579k, that puts him $235k less than home #1. This one's not as nice looking as the REO for $530 so he is also going to have to drop the price some more. (nice pics btw Mr. Realtor)

Now to be fair home #1 is a nicer house inside and it does have a pool. But how much is some fancy tile counters and a pool worth? Certainly not $300K! Besides, you have to knock off some money for the freakin barbie pink bedroom. This guy paid $870k in late 2005 and today the comps are listed in the mid 500s. OUCH! These homes sold in the High 600s when new in 2004. I think we can safely assume these are back to 2003 values.