Is it a racetrack Thats open 8 weeks a year?
Is it that beautiful Ocean and Beach?
Is it the great schools,Great weather or that Southern California beach town experience?
NOPE – ITS THE “IMMUNE HOUSING ” THAT HAS HAD ALMOST NO EFFECT FROM THE GREAT REAL ESTATE BUBBLE!
Lets take a example here:
what due you think is the true value of this home?
owner has it listed for a bubbly 1.175 m
it sold for 800k end of 2002
it sold for 535k end of 1998.
here is the value – lets take average crazy appreciation during this time between sales in 98 and 2002 – lets round it to a approx value of 650k on 01/01/2000. Lets figure 100k in renovations (take a third of that, because that is the most any renovation is worth and that is being generous, All homes need renovation every 10 years or so anyway- it is part of being a homeowner)
current value is :
650k on 01/01/2000
+ 33k(100K) for renovations
value is 683k . that is what this home is worth -700k tops.
to quote Mike from the movie Rounders:
” Listen, here’s the thing. If you can’t spot the sucker in your first half hour at the table, then you ARE the sucker “