New Keys for the Duncan REOs

Posted by Dave Fratello on Wednesday, June 2nd, 2010 at 12:08am.

Maybe there's no "wave" of foreclosures in MB, but there are scattered cases around town.

By coincidence, there were 2 bank repos on the same Hill Section street, each of which has found a buyer within a few weeks of the other.

1026 Duncan (5br/5ba, 3800 sq. ft.) first hit the MBC radar in December 2008. The sellers had acquired the home new in 2005 for $2.5m. They were looking to get out at the start of one of the most turbulent, depressed periods in the local real estate market for a hefty markup: $3.350m (+$850k/+34%).
That resale effort wasn't realistic, and the home fell off the market and out of the owners' hands over the ensuing months.

It came back in Jan. 2010 as an REO listing, seeking a hair less than the 2005 acquisition price: $2.450m. MBC said in an open-house review:
[T]he layout is "upside down," a floorplan that makes sense for this home because you want the living spaces upstairs. That's where the views are – some ocean and PV views, a benefit of getting high up the hill.

The downside of the location is close proximity to Sepulveda, a half block east.

Over a month, $250k came off the list price, and after 3 months total on market, a deal was inked.

1026 Duncan closed in late May for $2.170m, a drop of $330k/-15% from March 2005.

939 Duncan (4br/4ba, 3950 sq. ft. with views) is different in many respects.

It was also last purchased in 2005, but then it was as a rehab project. A massive rebuild/redo ensued.

Timing is everything on these ambitious flips, though, isn't it? Get it wrong and you've got 939 Duncan.

Here's an updated version of the chronology in our last post on this one, "Uh-Oh, Duncan":

  • December 2005: Purchased for $2.53m
  • 2006-07: The big re-do
  • Oct. 2007: Starts at $3.895m
  • Feb. 2008: Cut to $3.695m
  • Sept. 2008: Canceled
  • April 2010: Offered for $2.040m as an REO
  • late May 2010: In escrow
So, unless there was a bidding war, we're looking at someone grabbing a big ocean-view home, newly remodeled (though rented for a while) for $500k less than the pre-remodel price. When the bubble money is gone, that's the sort of discount you might expect. 
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