Remodeled in 2003 per the permits and purchased for $630,000 in 2004, the Outer Parkside single-family home at 2542 39th Avenue has just returned to the market listed as a “short sale” for $490,000.
In default on a $504,000 first mortgage with $41,332 past due as of three months ago when a notice of default was finally filed, and while not noted in the listing as far as we can tell, the home is also currently scheduled to hit the courthouse steps in San Francisco on January 3, 2012 at 2 pm.
And yes, while perfectly functional, we do find ourselves biting our tongues a bit with respect to the kitchen which was remodeled under the touted purview of “the previous owner who was an architect.”
∙ Listing: 2542 39th Avenue (2/1) – “$490,000” (short sale) [Redfin]
This actually looks to be a really good deal although I don’t get why people bother installing those tacky fake gas firplaces? No fireplace is better than such gaudiness…
Nice photo Ron. Well played.
Someone should try an offer of $1. I guarantee, it will be marked as pending within ten seconds so that the bank stops the sale.
I guess I’m stating the obvious: 20% down, mortgage paid for about 6 years until about a year ago. No pulling of equity out. Sounds like the owners tried. Sad.
It is sad. And they bought well before the peak. Paid a fair bit over comparable rent to bank on the appreciation, and they got that for a few years before it all went away and more. At least it was a decent little place and they are now living “free” for a while, but they’ve likely lost a fair chunk of their life savings and their credit is ruined.
The current sale price is obviously better for the next buyer. But to all those considering it, take my advice and rent some place instead. You’ll thank me in three years when places like this have come down in price even more. If you have the resources to lose up to six figures and you plan on staying in this little place for 15 years or so, then go ahead and buy, and enjoy your new home.
A.T. – I’m currently looking for a similar house to rent. Rents of worse places are going for more than $4,000 a month. That’s a far greater amount than a mortgage. I just can’t see places like this dipping all that much further, simply because there is so little inventory than there are customers like me: $150 – $200k in household income but lacking the $100 – $150k in downpayment.
Renting is a brutal, soul killing option right now.
AT, Mobileduck:
Rates are almost at all time low and rents are probably at all time high. Seems like if someone can buy a place that they plan to stay in then it may be good to go for it and get on with their life and spend time on other things rather than playing armchair economist. With these high rents it seems like people will have an even tougher time to save up for down payment of 20%.
Moblileduck :
Sounds like you are not in a position to buy now if you do not have the usual 20% down or close to that.
I agree with you in that rentals are at an all time high and there is a point when it DOES make sense to buy and that would be as follows IMHO :
1. You plan to hold the property for at least 10 years.
2. You are able to get some of these historical lows in conforming interest rates.
3. Your job looks to be very secure and if you are a two income family, that you are able to survive on one or the other’s income should something happen.
Houses have most always been a better purchase than a condo as far as appreciation. If you need to rent it out, you do not have the restrictions that come with a condo ( inablility to rent or CC&R’s that state no more than 45% of the units can be rented ). PLUS,………you do get a tax write off that means if you are paying $3000. a month for a mortgage, in real dollars will be somewhere around $2000. What can you rent for $2000 these days ?
People talking soberly about rent v buy and individuals specifically addressed are absent, despiote posting elsewhere at similar time signatures. Typical. Weak. Disingenuous. Decrepit.
^^Are you suggesting that people are using pseudonyms to make a drawn out point and deceiving the readers by creating a false dialog?
“What can you rent for $2000 these days ?”
I walked through an openhouse in Pac Heights for a 1 bedroom condo earlier this year and the realtor was telling everyone that the place could rent for $3500 a month even though my apartment which is a block away and is much better, larger, and includes parking goes for under $2400.
Shouldn’t there be laws against realtors overinflating what their units can actually rent for?
Realtors overflating prices?? No that would never happen, now would it???
“and individuals specifically addressed are absent, despiote posting elsewhere at similar time signatures”
?????
Started on the champagne 24 hours early?
Bobblehead – Realtors can only rent a unit for what someone is willing to pay. are you suggesting we put an artificial cap on rents in San Francisco? Do you not understand what the term “free market” means?
@Fishchum
I guess anyone is willing to pay a billion dollars for a bridge in a free market.
Pathetic comment on your part but thanks for the laugh.
“Bobblehead – Realtors can only rent a unit for what someone is willing to pay. are you suggesting we put an artificial cap on rents in San Francisco? Do you not understand what the term “free market” means?”
I understood what BH was saying. You can ask whatever the hell you want for someone to rent, purchase, lease etc. The market needs will dictate the value.
But as far as an “artificial cap” and “free market” goes……….we have rent control to take are of that, remember ?
What can you rent for $2,000? Not much. A 1BR? But I’m not in that market. 3BR’s are starting in the low 3’s . . . and often that will only get you a flat with a shared yard. $4,000 – $5,000 is the common price point now for renting a SFR. So when I look at the place above where a buyer with 20% down would be looking at a total monthly outlay of ~$2800 (Pmt, Taxes, Ins) this tells me that the low end may get propped up by buyers similar to me. They might be trading down in neighborhood slightly, but some of the best public schools in the city (Key, RLS, Sunset) are all in the Parkside/Sunset area.
Bobblehead – You still haven’t explained how a realtor is “over inflating” the price on a rental. In your example, what was the asking rent on the unit you looked at? Was it $3500? If it was, then the market determines the value – if no one applies, then unit isn’t worth $3500. If someone agrees to pay that much, then that’s the value. That’s how it works. The realtor is acting in the best interest of the owner to get the highest possible rent for the unit.
So again, how is the realtor guilty of “overinflating” the rent of the unit?
Mobile duck,
Really? A 3br park side house will go over $3k. Wow, I had not looked at that, and it’s not what you generally hear about rent on this site.
Again, and sans barbs, low 3Ks minimum and 4 to 5K rent for a decent 3BR seems like a compelling reason to buy in this market.
After tax costs on this place will run about $2700, rent looks to be about 3200.
Looks good, but now add the realtor fee when you sell, loan costs, etc and you need to budget another $38,000.
If prices don’t fall in the next 5 years, and rents don’t rise, the $500 per month you save in rent over 60 months ($30,000) will be overwhelmed by the transaction costs, so you lose $8,000.
Now take into account a hypothetical 2-3% drop per year and a 2-3% rise in rents per year, and you are looking at another $30K loss by buying at the start of a European recession and a slowdown in China. That assumes you don’t remodel, get a new roof, paint, water heater doesn’t need replacing, etc.
Hardly compelling. Someone might decide to make the trade off, but not for monetary reasons.
Anybody will surmise you left out tax deductions on purpose in order to purposely play dumb. Why? So that you challenge others to boringly have to get remedial, and to pull the wool over casual readers’ eyes. After all, you’ve vetted deductions countless times on this site for all regular readers and posters to see.
Deductions and opportunity costs incorporated.
“back to where it started” is the topic of the thread. Tell me more about how great the opportunity costs are. That and the fact you are also paying down the mortgage as well with the 5 year hold. Hypothetical drop? says you. And on and on we go….
Wait, that is the name of the other thread. But the point is the same
I get about $2700/mo after mortgage interest deductions (yes, opportunity costs are real; otherwise cash buyers live free which is untrue). It is true that about 700/mo goes to pay down principal. But tipster also ignores maintenance costs. So if this place could fetch $3200/mo rent (I doubt it but let’s accept that), then – as I said above – it is worth considering If you have the resources to lose up to six figures should you need to sell in the next 5 years (job, divorce, health) and you plan on staying in this little place for 15 years or so. SF is getting back to the normal situation throughout the history of SF and the world in general where it is cheaper to own than to rent. Not there yet except on the fringes but moving there as we all knew we would.