Renting Can Cost You, Part II

Posted by Dave Fratello on Wednesday, October 7th, 2009 at 8:00pm.

Not so long ago, MBC featured the case of 2909 Elm (5br/4ba, 3450 sq. ft.) which had been vastly overpriced before renting out in 2007, perhaps hoping for a market turnaround. (See "Renting Could Cost You $300k.")

There was no market upsurge after Summer 2007. Instead, the home later sold for $575k less than the price on it when it had quit in June of that year. (Closed price: $1.450m in April this year.) 

Now a nearly new (2008) home that came out in Spring 2008 at $1.995m is back about $300k lighter. It's 2901 Oak (5br/5ba, 3250 sq. ft.), starting Weds. at $1.699m.

The home spent almost 3 months on market last year – always at $1.995m – and appeared to have a deal at one point in August 2008, but the escrow seems to have failed. Since the property's been off-market since then, we take it that it rented out instead.

Asking $2m for an Oak property last year was pushing it a bit. However, after 2901 Oak quit, 3109 Oak came out even higher in October – $2.329m.

After 6 months of sliding downwards, 3109 made a deal at $1.660m (-$669k/-29%), closing in June of this year.

That deal and another Oak sale from earlier this year – a custom Spanish at 1825 Oak (4br/4ba, 3136 sq. ft.) that sold for $1.679m in August – lend support the new price at 2901. But you wonder what they might have gotten if priced right last year, instead of waiting till now.
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