Purchased for $1.3 million in 2013 and permitted for a major remodel and expansion by “SS Dreambuilders LLC” (no relation to SocketSite) in 2014, the Potrero Hill home at 837 Wisconsin Street was foreclosed upon and sold for $1,945,375 on the courthouse steps in 2015, a discount of roughly $250,000 from what was owed on the unfinished project at the time.
And this morning, 837 Wisconsin Street returned to the market listed as an opportunity for “a developer or individual who wants to [finish] this [potential 4,043-square-foot] view home” for $1,950,000.
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So the auction buyer had no intent on finishing the project? Flipping an unfinished property on the less desirable side of the hill like this is a gutsy move. There’s probably less than a dozen candidate buyers, half of which might already have their development pipeline full. I wonder what sparky-b thinks about this.
Sure I will jump in.
I offered on the house when it was at 899k. I think I offered $1mm. They overpaid at $1.3mm. They also had this place and 12 others for sale off market for $1.8mm in 2014, no takers.
The current owner seems to have got the permits complete. They show October of 2015. I don’t know if they thought there was value in finishing the permit process, but this pricepoint doesn’t seem to show that.
It isn’t worth this much money. The top end of this area is about $3.7mm. There is still a big build to do and I wouldn’t trust anything that’s been done to date. If you spend $1.2mm on the build and you get top dollar on the sale you make $150k.
Wondering about the first flipper on this – based on the SS post, it seems they borrowed about $2.2M on this property and didn’t get it done. Must have been been frantically moving money around to cover other projects. On the plus side, at least now a new owner won’t have to redo some Home-Depot-special remodel. Or maybe that’s what we’re going to get now, because as MoD says, this is quite a risk.
I think everyone is realizing how they all lost money and want to pull out with most of what they invested. This is not a 2 million dollar home, especially if unfinished.
BM- clearly some bank thought it was worth $2.2M because they let the first flipper borrow that much! I think it’s more likely he took the money and used it elsewhere. The first flipper didn’t need $900K to fix this place up, and he certainly didn’t spend that much since he didn’t finish. Not knowing anything about the condition of the property, but if it was in decent shape he reasonably could have estimated spending $300K to fix it up, sold it for $1.8M and made money.
See the comments on our piece about the foreclosure last year.
But do keep in mind that the unfinished plans for this property included adding a new floor (i.e., the project budget was well over $300K).
This should sit for a long time at 1.95mm and then be delisted in what some (ahem) will no doubt take as a sign of a weakening market. Paying 1.95mm on the steps for a gutted 1300sf house just means the current owners are chumps. Not sure it says much else about the market…
Well, it says that the market was so tight for inventory in 2015 for flips etc., that people were chumping themselves.
Almost $2M for this?!?!
Oh please, please, please tell me you’ve posted the wrong pics, or it’s actually every house in the panorama, or it was Liberian $$ or something…
open floor plan
The lady behind Dreambuilders had a big Bay Area portfolio with several properties in SF. Properties were all financed with hard money AND the lender added construction $ to the financing (so the LTV was very, very high).
She over-paid for many properties, the work her crews did were haphazard at best (I looked at a few abandoned projects) so not too many developers wanted to inherit the bad work as it all needed to be re-done, and there was no back end to the SF properties. Textbook case of how not to make money as a flipper.
Perhaps it was all funding a gambling problem. I mean, one over and above the real estate strategy.
Meanwhile, Eagle Vista Equities continues with its no permit, no problem flips.
Interesting, looks like Eagle Vista sold this one mid-flip.
SS Dreambuilders is run by crooks. They have multiple lawsuits against them. If you have issues with them please contact me as there may a class action lawsuit coming against its proprietors. They also do business under crossdial construction and technologies.
UPDATE: Foreclosed upon Failed Flip Fetches $1.9 Million