August 12, 2011

Flip This Location Fail

This new listing appears courtesy of happy-piggy over on Redfin’s Bay Area forums.  It’s definitely a flip, because the house changed ownership all of five weeks ago (as I write this).  Your challenge, dear Burbed readers, is to find as many reasons not to line this flipper’s pockets as possible.

Yes, we’re going to play What’s Wrong With This House.  See how many problems you can find!

178 LAS ASTAS Dr, Los Gatos, CA 95032
$949,000

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BEDS: 4
BATHS: 2
SQ. FT.: 1,354
$/SQ. FT.: $701
LOT SIZE: 7,208 Sq. Ft.
PROPERTY TYPE: Detached Single Family
STYLE: Ranch
STORIES: 1
VIEW: Neighborhood
YEAR BUILT: 1958
COMMUNITY: Los Gatos/Monte Sereno
COUNTY: Santa Clara
MLS#: 81133706
SOURCE: MLSListings
STATUS: Active
ON REDFIN: 1 day
NEW LISTING (24 HOURS)

GORGEOUS REMODEL * MAPLE CABINETS * CHERRY FINISH * SLAB GRANITE * S/S APPLIANCES * WOOD FLOORS THROUGHOUT * CUSTOM TILED BATHS WITH GLASS ACCENTS * SEAMLESS GLASS DOOR * HIGH END CARPET * NEW INTERIOR DOORS * HARDWARE * MOLDING * SEP LIVING WITH MARBLE FACED WOOD BURNING FIREPLACE * * SEP FAMILY ROOM * RECESSED LIGHTING * HUGE LOT * CENTRAL HEATING & A/C * NEW LANDSCAPING * DOUBLE PANE WINDOWS & SLIDERS * LOS GATOS SCHOOLS *

imageSo, what is that in the first picture?  Looks like the agent made a real point of minimizing something.  See what I mean?

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Harder to see in the second picture (#18 on the Redfin page), but there I see something strung up there, more than enough to equip a sitar.  Let’s go to our eye in the sky to check this out.

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No, I wasn’t seeing things.

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YOWZA.  And here’s what happens if you look at the house on Streetview and then look straight up:

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I’ll leave the rest of the hunting to you guys, but be sure to check the neighborhood out to make sure there aren’t any other issues lurking nearby.  Have fun!

Comments (15) -- Posted by: madhaus @ 5:05 am

15 Responses to “Flip This Location Fail”

  1. Divasm Says:

    There’s clearly a disturbance in space somewhere in the kitchen! In photo 7 it looks like there’s a spacious kitchen with enough room to perhaps park your RV or boat when not in use. In photo 8, this very same kitchen is downgraded to “cute kitchenette” worthy of a Residence Inn standard room.

    One only wonders what would happen to your family dog upon entering the kitchen – upgrade to horse or downgrade to rat??

  2. Sam_Adu Says:

    Bay Area Crime Maps shows some “interesting” characters living nearby this address. My beloved Campbell would never allow such ruffians to inhabit its environs.

  3. madhaus Says:

    This house is open for looky-loos this weekend, 1:30-4:30 both days. “BEAUTIFUL REMODELED HOME.” Whatever was remodeled, they had to do it in a month, so don’t expect quality workmanship.

  4. Divasm Says:

    Oh – and also this house is only 600 meters from a major gas pipeline. In San Bruno we call that “Ground Zero” land.

  5. bmwman91 Says:

    A $256,500 price jump in 5 weeks…nothing to see here folks, just the usual (R?)BA appreciation.

    Are there THAT many buyers out there that don’t bother to check Redfin/Zillow/etc & blindly buy shit like this? I want to see the flipper take a $256k bath, but at the same time any moron that buys this gets what they deserve. Could this be bait for the Chinese all-casher?

  6. bmwman91 Says:

    FOREIGN BUYERS! Buy now or be priced out forever!

  7. SEA Says:

    This photo: http://www.burbed.com/wp-content/uploads/2011/08/image43.png has RPL, Real Power Lines, which are required to be considered for the RBA.

    The other photo with the red arrows shows transmission lines, which are not included in any of the agent’s photos.

    Also the wide angle lens makes the driveway look very long, as if one could park several cars in the driveway. On closer inspection, it appears that you should be happy to park two cars with any space leftover. But, if I remember right, it’s better to park your car in the street, or something.

    Finally, that dam better hold.

  8. A. Lewis Says:

    You didn’t include the vital price history:

    Jun 23, 2011 Sold (Public Records) $692,500

    (Noted by bmwman91, though).

    Just wow – I declare I should get $250k for nothing!

    Wait, help me estimate the costs of flipping this house, including carrying costs.

    6% for realtor fees = $56,940!! Eating into your profit awfully quickly. Does Los Gatos have transfer taxes?

    Short term capital gains must apply, too, right?

    Please chime in…

  9. SEA Says:

    #8- Nice observation regarding the REALTOR fees.

    When the value is in the land, one would expect that such value will not change no matter what is done with the messuages.

    So when the transactional costs are 6% of the total sale, which is heavily weighted in land, the drag on the potential profit is quite large.

    “Short term capital gains must apply, too, right?”

    Maybe. Assuming a ‘gain.’ lol.

    That said, you note, “I declare I should get $250k for nothing!” (As you noted, you didn’t deduct the REALTOR fees, but let’s just use your $250k number.)

    Give me $250k for doing essentially nothing and I’d be more than happy to pay the tax, given the option to avoid paying the tax is to not get the $250k.

    Would I invest $1 in this? Nope.

    How much more is a standard sale worth over a distressed sale?

  10. Real Estater Says:

    Homeless person in Palo Alto is probably smarter than the average person in your city

  11. SEA Says:

    If I remember right, Palo Alto loves its ‘transient guests.’

  12. Real Estater Says:

    Palo Alto will be infused with tons of cash in the next few years:

    1. $40M scheduled to be received from Stanford
    2. Palo Alto airport is expected to rake in $16.2M

    The city will be leaps and bounds ahead of where things are right now, and it’s going to be an even better place to live. Buy now when the prices are still low.

  13. nomadic Says:

    #12, WTF happened to your complaints that we talk about PA too much? Today is Los Gatos’ day to wallow in the stupidity of real estate.

    Making the huge assumption that the remodeling was done with permits and to a good standard (yeah, and I have a pet unicorn), this house should sell in the upper $800k range or better.

  14. The Gilroy Alex Says:

    This looks like a great place to retire to if you’re the Wichita Lineman.

  15. Robert Says:

    Uh, y’all are worried about the power lines? The house is right below the dam at Vasona Lake. I’d be more worried about flooding than electromagnetic fields. But wow, high tension lines running down the middle of the street; I’ve never seen that before.

    My guess is this is a flip with at least a bit of work behind it. The previous owners must’ve been there since the 1970′s with an assessed value still around $200K after the prop 13 increases. My guess (since I can’t find the listing from June) was that the house had some deferred maintenance and a dated look. I’ll bet it got new bathrooms to replace the original 1950′s ones (wonder if it had the pink toilet and sink typical of my parents’ neighborhood), new kitchen to replace a 1980′s refresh, vinyl windows to replace the old aluminum crank-out sashes that never got replaced, and a bunch of cleanup. I don’t know if that’s worth a $250K flip, but I’ll bet it was more than a coat of paint.

    I’m not willing to try to call how fast this will sell. Normally, I’d never bet against a house with “Los Gatos Schools” in the listing, but those wires are pretty obvious.

    I also suspect the fact that some developer was able to develop those houses in the 1950′s suggests that a Los Gatos mailing address and Los Gatos schools were a pretty good selling point even back then. If Los Gatos wasn’t that special, then who would have bought one of these houses when they could have had the same house in a… less challenging… location in San Jose?

    And if you wanted that pink toilet, you’re out of luck. I’ll bet it’s buried deep at the dump already. The dump workers definitely don’t want those rising from the dead.


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