This is a pretty sweet little property, short sale, inability to see the inside, or total lack of information on the mls (no picture, no comments) notwithstanding.
The location is prime “north of Adams territory”, great neighborhood. Check it out:
It’s a triplex, with a three bedroom, one bedroom, and studio. I couldn’t get into the units as they were tenant occupied, showing instructions were “with accepted offer only”. The studio is advertised at $850 rent, the one bedroom at $1,325 (which seems real high for the area) and the three bedroom does not list any rents. May be owner-occupied, I’m calling the broker shortly to get the scoop. If it’s the three bedroom house in front, I’d ballpark the rents at $2,000-$2,250 if you included the garage. With the three bedroom at $2,000, you’re grossing $4,175 per month or $50,100 per year. Pretty dang good for a list price of $417,000!. Per unit price of $139,000, great number.
Two car garage PLUS two spaces, hard to find this kind of parking in Normal Heights. The three units are divided between two buildings.
More in-depth financial analysis to follow, I just wanted to get this one up here as it just hit the market.
Wow. I mean, just wow. This one is on par with the worst I’ve seen, and I’ve seen wiring ripped out all over the place, holes where toilets used to be, and vomit on walls (for real). I’m pretty sure the ancient house in front was held together with popsicle sticks and scotch tape. The debris was amazing, the most cluttered I’ve ever seen. Junk everywhere. Pros:
Price is $250,000 Back unit was built in 1988 Four car garage Great north of Adams Ave location
Cons:
Front house is likely a tear down Have to pay cash Have to pay cash and close by July 7th as per lender
Bottom line, demo the front house, probably around $10,000, permits needed, clean up all the trash. Back unit needs $10,000 in remodeling. So you’re in for $270,000 for essentially a house with a large lot that you could possibly develop.
Offer $200,000, cash, close quickly by the 7th of July. If they take it, great, if not, move on.
Rents: if you clean up the back unit, yard, etc, you’re looking at $1,400 for the unit and $400 for the garage. About $1,800 gross on a $200,000-$250,000 investment.
O.k. you probably noticed that the address has the zip code for North Park but I listed this property as part of University Heights. This is by far the most uniquely situated duplex I have come across in my hunt for deals in the metro area. The zip is North Park, the tax assessor’s map shows it as University Heights, but you’re very close, if not in, Hillcrest. It sits at the juncture of all three neighborhoods and is on the most elevated portion of University Ave, likely there before that part of University was even built.
This is a short sale, two one bedroom units. One is remodeled, and one is more or less original condition, but could be rented out ,i.e., it’s not trashed. The units have documented rents as per the owner at $1,100 and $1,150. Price: $350,000. The killer thing here is the garage, it’s a two car side by side (tight fit) with an extra lockable storage room. Pretty cool. Really helps with the rents.
This property is best for the owner/occupant, as it doesn’t have quite the number of bedrooms to really make it super appealing for the pure investor. But it DOES cashflow right off the bat, using a 6% loan with 25% down. You are STILL being paid to own a building that will only get better and better over time as the market continues to recover.
Video of the outside and really crazy private pedestrian bridge castle-like private entrance:
Ok, this two bedroom one bath, and one bedroom one bath duplex with a detached three car garage hit the market on Thursday of this week, I finally got a chance to preview it today; on the mls sheet it looks pretty good, but then you get there and discover that while it’s still a good price to own something in the Mission Hills/ Hillcrest area, this thing is going to be a project and a half.
I talked to the agent on the phone prior to seeing this and unlike most reo agents, she actually answers her phone. She was great and filled me in that this property will need a lot of termite remediation and the windows likely need to be replaced. My assessment after walking through both units is that this may need about $20,000-$35,000 to get up to snuff.
The termite damage was extensive throughout, and the windows weren’t too bad but perhaps could use replacing. Foundation needed definite leveling and perhaps replacement/ augmentation, at least through the middle of the structure. The outside part of the house that contacted the ground was cinderblock construction, but if I had to guess, and I am, I’d say the middle was a post and pier construction-pretty common on a 1920’s house that this needs fixing ninety years later.
Landscaping needed serious help, but you run into that all the time with reo’s. The previous owner claimed that he was getting $3,000 per month for the property. I don’t know about that…it does have an awesome garage out back that is cinderblock construction and has three spaces that could be rented for $150-$200 per space, but $2,000 for the front and $1,000 for the back unit seems high. If this thing was fixed up, I would probably go $1,500-$1,700 for the front unit and $850-$950 for the back unit. You could rent out the garages with, or separate, but if it were me, I would throw in two spaces for the existing tenants on both houses and rent out the bigger one for $200 per month to someone else entirely.
My final comments are that this property is for someone looking to take on a serious project and maybe specializes in fixing up these types of properties. I don’t think it will sell too far over the asking price of $347,900. Maybe up to $370,000, but not too far over that.
Pros:
It’s bank owned and still cheap for what you get
Mission Hills/ Hillcrest location = high rents and better appreciation over the long term
Three car garage = extra income or throw them in with the units and choose from better tenants from the increased demand
Cons:
Serious amount of work, large cash outlay at time of purchase, only for the bold
Only three bedrooms vs. other properties for the same price having four
I usually don’t do too many houses, but this one is cheap at $329,000 for a four bedroom, three bath with a garage and lots of off street parking-hard to find in University Heights. It’s a great value.
It looks like the previous owners were doing a full remodel and ran out of money. So there’s some unfinished stuff; it’s clear it would be a pretty cool house once the finishing touches are done.
So I took a look at this one today, a duplex with one two bedroom one bath unit and one studio unit in the back. It’s a short sale, which is (I never thought I would say this) actually better than a reo in some cases. They’re hard to close and scare off a lot of the competition which = lower price for you.
In any case, this is pretty cool property. Nice big lot set high off the street, feels like a real house, lots of extra room, little backyard and sideyards, street dead ends into Balboa Park or you can walk up to University. Cool.
Here’s my walkthrough-a little shakey as usual, but I’m getting better:
This has been on the market for over 190 days and originally started out at $479,000. Now it’s priced at $395,000. Not bad, not bad, as the Morley Field area is a great area to own in, but I’d like to see that price lowered to reflect the studio in the back.
Like most properties I preview, this one is worth an offer if this area interests you. Thanks for taking a look!
This is a gameplan and timeline I just wrote to some clients of mine that have an offer in on a very complex short sale that almost everyday has new challenges pop up:
Hi guys, I wanted to send over a brief overview of how this is going to work from here on out. Your offer and the needed documentation has been submitted to one of the legal owners-the bank needs his signature as well as his ex girlfriend’s before it can approve any short-sale action. Out of all the short sales I’ve done (my first was in 2005), this one has the most variables. For this transaction to come together, the:
-other person on title needs to be found and compelled to sign the offer in addition to the first person
-auction has to keep being postponed repeatedly by the lender on the first loan
-bank/s has to accept your offer in writing above the other offer that is already in and any others that could come in between now and that time
-all this has to be done twice as there are two loans with two different banks, and two legal owners. basically four decision makers that need to sign off on the file to make this happen
My point is, hope for the best, expect the worst. Don’t attach yourself to the outcome, and keep looking at other properties. This will all happen over many months if it happens at all. I’ll manage all the details of this and keep you updated as we go along. There is no doubt in my mind that this property is worth the hassle. Remember prices when we first started looking!? $475,000 for this house in that neighborhood is awesome-I really want you guys to get this one.
A final note: I may have mentioned this before, but all indicators are that in the sub $500,000 market, we hit the bottom a few months ago. The rates are the lowest they’ve pretty much ever been, the prices are down to pre-1997 levels in many cases, first time homebuyers and investors (the first to enter a good market) are flooding into the market non stop. Most reo and short sale properties have multiple offers in days above the list price. We’ll keep on top of this place, but if you guys see an interesting house, don’t hesitate to call or email me asap. I will go look at it if you can’t make it or at the very least check the status and update you.
Keep your fingers crossed, keep looking at everything I send over, and I’ll talk to you soon,
–
Ted Lucier, REALTOR
Prudential California Realty,
La Jolla
1299 Prospect St
La Jolla Ca,
92037
Nine offers as of 3:30 pm today, with highest and best offer due by 4:00 pm today. This first hit the mls on Friday, and was not available to see the inside of until Saturday.
In any case whether someone saw the inside or not, it sold in four days. I’m seeing multiple offers like these across the board on most properties under $500,000.
If you don’t submit an offer on one of these in the first 3-5 days it hits the market, your chances are slim to none. We have the lowest rates in years, and prices are down to 1998 levels-put both together and it’s a “perfect storm” of cheap money and cheap property that pays you to own it.
Like I’ve said before, by the time the media picks up on this, it will be too late to make the big money profits and cashflow that other people are making right now. Take advantage of this while you still can!!!
