Reduced $865k

This home was featured in a Delusional seller post a few months ag0. 16909 Ridge Cliff Dr in Lake hills. It's a large 5 bedroom, 4.5 bath 4576 sq/ft home. The delusional seller was asking 1.3 MILLION! He paid 1.043 million right at the peak. I dunno if he pulled cash out or what but he seemed to need 1.3M. As expected it's sat on the market since last June and he never reduced the price even once. What a tool.

Fast forward to today and it's now bank owned. Even the bank was clueless on this house as they tried to get $977k at the trustee sale. The broker listing the home seems to be clued in though and he's listed it for $435k or $95 s/f. Today, that's a pretty good price. I doubt it will be a year from now. But right here, right now this should sell at that price. Plus he can use "Reduced $865k!" in his marketing of the home....

I'm heading out of town for the weekend. You guys behave yourself!

The price is wrong B'tch!

How long does it take a bank to realize the "price is WRONG B'tch". I give you an REO, that's been on the market Two Hundred and Fourteen fa-reeking days. And the listing still says "hurry before it's too late". hahahahaha

16418 Village Meadow Dr. in the Lake Hills development in Riverside. This big ole Mcmansion sits on a hill and overlooks the elementary school below ( I hope you like the sound of screaming kids). It's a 5 bedroom, 4.5 bath home. It's very nice inside but the yard is just rocks (and I do mean rocks). The lot is big at .8 acres but .6 of that is hillside, on all 4 sides. It has a good size yard but at least 1/2 of that .8 acre is not useable. The home sold new from the builder in Dec 2006 for a peakish price of $855k. Those peak prices are really starting to look stupid now, aren't they? It went back to the lenders in May. This home has actually been listed since April 07! After the lenders got it they listed it for $540K. They did have one whopping $7k price reduction (1.5% come on people). It's been listed for $533k since Sept. As the market crumbles around them they just sit and wait for a miricle. The price is obviously wrong b'tch! Yes, I said "the price is WRONG". Price it at $429K and you might have a chance. But do it quick before the next wave of REO's hit.

Some banks are getting a clue

here's a couple of example of banks that are finally getting a clue about the current market.

16247 Boxford CRK, Riverside, CA 92503 This home is in a decent part of Riverside. It's a KB Home, the tract was built starting last year and I believe they are still building them. Our feature presentation is 4132 sf and has 3 beds and 2.5 baths (seems kinda odd for the size?). This home was purchased new in Jan 2006 for $787K. (This must have been one of the first homes sold in this tract). Fast forward a couple of years and the bank takes the home back for $562k in early December. Normally they would have listed the home for at least what they are owed. But fear, desperation or maybe a small dose of reality has persuaded them to list it for the bargain price of $494k.
Total loss, $293K or 38% in two years.

16414 Ridge Field DR, Riverside, CA 92503 This is another Lake Hills implosion. This home is 4094 sf and is a 4 bed 4 bath. Purchased new in August of 06 for $965k (right at the peak). This poor sucker could not have purchased at a worse time. The bank in now the not so proud owner of this mini mansion. They took it back last month for $832k. They did not even bother trying to list it for anything close to what was owed. They listed it at $532,500. Good thing too, because there are 2 identical homes both listed at $530k. The bank has this listed for $300K less than the loan. That's a 36% loss to the 1st and a 100% loss to any 2nd lien holder ( we all know there was a second, right).

If this sells at $532 the loss will be $433K or 45%.


Even at these prices I think these homes are overpriced. They still don't pencil out using equivalent rental costs.

Let's take a look at home one.

$494k with 20% down and a 30 year fixed at 6.5% gets you a Payment of $2500.
Taxes and Mello Roos on this home is 1.8% or $740/mo
Add anothe $200/mo for insurance

Grand total (give or take a couple of hundred) is $3440.

The best you could hope to rent this home for is $2500. You would probably have a helluva hard time renting either one of these for anywhere near that considering they have dirt yards. Anyone that can drop $2500/mo on rent is smart enough to find a home with a nice yard. So this home still comes up roughly $1000/mo short. Even at 38% off this home is no where near it's actual "value".

This house would have to sell for $350k in order to break even renting it for $2500/mo.

We have a winner!

A winner of the award for the biggest loss in the shortest time.

16856 Blue Bird PL, Riverside, CA 92503

This home is a big-un up in the Lake Hills development (I know I seem to be picking on this development). It's 4576 sq/ft and sits on a huge lot of just over 1/2 acre. The big lot must be why the price tag was so high. It looks like it sold new in July 2006 for $918k. Then it sold again in Feb 2007 for 1.18 Million.

After only 6 months of ownership it goes on the market for $899k. That would be a loss of over $200k but after 30 days the price drops by another $300K!!! It's now listed for $599k
That is a loss of $518K or a 49.3% drop in value in 9 months (assuming it sells).

More Riverslide

The carnage continues.....

First a look at another couple of big losers in Lake Hills Reserve. This is one of the more overpriced developments in Riverside. Homes at the peak were from the low 600's to over a million. A year later and prices are starting to plummet.

17093 Rocky Bend, Riverside, CA 92503. This poor fella bought his estate at the top of the hill for a song. A song to the tune of 1.043 Million dollars only 11 short months ago (WTF was he thinking?). In addition to the purchase price it looks like he's dropped another few dollars landscaping the back yard. He's got a fire-pit, BBQ, waterfall and a lot of fancy concrete work. He's easily dropped another $50k on the yard. I dunno what happened but his monster 5074 sq/ft 5/4 is now on the market for $850 as a short sale. That's an astonishing loss of over $200k (plus fees) if he can unload it. Let's face it, he's got a better chance of hitting the lotto and catching up on his payments.

18730 Lakepointe, Riverside, CA 92503. Another Lake Point loser. This poor fella bought his dreamflip last December. After a few months of ownership he does the normal thing and places his dreamflip on the market for $100k more than he paid. That's normal operating procedure in SoCal, right? Well, unfortunately he was about a year too late and after 142 days with no bites he's now down to $580k and "very motivated" according to the listing. I bet, because there is still not much chance of selling his house even at $140k less than he paid

16517 Cheltenham, Riverside, CA 92504. This one is not in Lake hills but over in Woodcrest. This is another monster, 5426 sq/ft sitting on an acre. Our flipper bought this thing for 1.058 Million just over a year ago. He's grown tired of it already and you can buy it today for the bargain price of $850K. That's another loss of over $200K plus fees in just over a year. I doubt he will have much luck though as the builder (KB) is selling these for $699K. Ouch, that's gotta sting!

Growing roots, days on market

I searched Ziprealty to see what the longest "days on market" was that they had listed for Riverside.

11365 LAKEPORT DR, Riverside, CA 92505 is a 5 bed/4 bath 4252 sq/ft home. Built in 2001, this home is in the Riverwalk area of Riverside. It's not the best area but it is the western most part of the city of Riverside. It look like our greedy seller paid $417,500 for this behemouth. The he added a pool and a little paint. In March of 2006 he listed the home for ....drumroll please.... $960K! He has been slowly reducing the price ever since, all 570 days since. He's only down to $865k though. The amazing thing about this home (other than the asking price) is the color of the bathrooms. BARNEY PURPLE bathrooms, that's got to be hard to take after a long night of drinking. You'd think after a year and a half they would at least paint the purple bathrooms.

Really, they are PURPLE, I'm not making this up.

18314 LAKEPOINTE, Riverside, CA 92503 this is a new home, never lived in up in the Lake Hills area. It's a nice area but this home is at the very top of the hill. I can only imagine how many sets of brakes you would go through every year living up that hill (transmissions too). This is another big home, 5 bed/4.5 bath and 4895 sq/ft. It was built in 2006. I can't find the original selling price or tax info but these homes were not cheap. It was put on the market in April of 2006 for $1.095 million, total DOM 525 days. It's seen 3 price reductions but it's still only down to $925k. That's a lot of money for a home with a dirt back yard.

I found about 100 homes that had been on the market for a year or more. These two are by no means unique. In fact they are probably going to become the norm, unless prices come back to reality.