REOs East and West (WoS)

Posted by Dave Fratello on Wednesday, December 29th, 2010 at 5:36am.

MB has mostly been spared the foreclosure carnage visited on other parts of California. That's one reason our market was recently called "the most stable housing market in the Los Angeles metro area." (See "Stability, Bullishness.")

But rules always have exceptions.

Two active listings in very different areas west of Sepulveda cry out to buyers with bargain prices for foreclosed/bank-owned properties.

The first that draws our notice here officially launched in early December, though it had a sign in front and was available as early as October.

1508 Oak (4br/2ba, 1775 sq. ft.) is as far east as you can get but still be west of Sepulveda, and it's got all the liabilities you might worry about.

It's on the "wrong" (commercial-adjacent) side of Oak and adjoins a commercial parking lot.

The home itself has no curb appeal. It did fetch $900k back in 2004, though, and it appears to have been upgraded after that. (Ah, the go-go days.) 

Once the past owners got in deep trouble, realizing they'd lose the home, they stripped the fashionable kitchen they'd installed, removed windows, and partly destroyed bathrooms. (A detailed video documentation of the post-foreclosure property is here.)

The current listing says the past homeowners borrowers owed $1.270m by the end – nice equity extraction – but the latest list price, after a recent cut, is $823k. A new kitchen has been installed; various stripped pieces returned.

So can you stomach the location for a home west of Sepulveda in the 90266 at a decent price? Someone will in 2011.

The second is a fairly big ocean-view home at 3121 Alma (3br/3ba, 2600 sq. ft.).

Just a week ago, it launched at $1.147m, a curiously precise – and very low – price for what this home is. And we note that it last sold for nearly $1m more, $2.075m, back in July 2006.

The home was actually remodeled after that 2006 purchase (see video here), so even though it was nearly a peak purchase, you can readily argue that it belongs in the $1.5-$1.9m range now. 

The catch: Some of those updates are gone, the outgoing owners having partly stripped the house. Some missing pieces have been replaced very recently, in more workmanlike fashion, to make the home more salable.

Janie Sue Nagy presents a good writeup of the recent history of the property in this post, including the curious fact that the home was reclaimed in Nov. 2009 by a bank (First Federal Bank of California) that evaporated shortly thereafter, creating some confusion before the home finally hit the market late this year.

Of these 2 properties, we haven't seen buyers jumping at Oak, but for Alma, we'd imagine a little frenzy.

A Tudor house needing basic repairs – or maybe more – plus some stylistic updating is going to have a smaller audience, especially late in the year, but look at the upside. There's something there.

Oak, that can wait.
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