Foreclosure
The house next door to mine is being sold by the bank. I suspect that the guy who bought it overpaid for the 2bd/1.5 bath no basement and probably overestimated how much he could rent it out for. Rents in the eastern Shaw area (based on a quick Craigslist search) range from $1500- $1700 for similar units. Dude paid about $400K for the place. I've been in it, it isn't worth $400K. Heck, even my beautifully renovated 1/2 painted house isn't worth $400K.Now it is on the market for something in the mid 300K range 'as-is'. Competing with it on the same block is a nicer end unit in the low $400K. I don't know how the two will play off each other, but have seen at least one set of buyers look at one and then the other.
I realize that this is not the only piece of real estate where some 'investor' paid too much and failed to notice that the mortgage, taxes and insurance were more than what the market would bear as a rental. But I'm not all that sympathetic to a group that jacked up the housing prices because they couldn't gage the market. Also I think this is the same group that 'renovated' houses for flipping without a decent eye for beauty only to have their properties sit because they u-g-l-y. But that's another post, for another day.
Labels: housing
posted by Mari @ 9.7.07
9 Comments:
Waiting on baited breath for the U.G.L.Y. post.
"But I'm not all that sympathetic to a group that jacked up the housing prices because they couldn't gage the market."
Hear, hear. Couldn't agree more. The investors/flippers have driven the RE market in central D.C. up to unconscionable levels. I'm all for making a profit on an investment, but these people typically bring nothing to the neighborhood other than an inflated rowhouse.
News flash: Simply because you own a 2 BR/1.5 BA rowhouse in Shaw/Eckington/Bloomingdale does not automatically entitle you to a $450k purchase price or $2000/month rents.
I think it's going to be a very interesting 18 months, what with adjustable rate mortgages about to go up.
Anon try not to be too anon with any following posts, I like people to stand behind what they say, even if it is with a fakename.
Jimbo, oh, wait till I get ahold of my camera. There are two places I have in mind.
Regarding foreclosures: "A View of the Economy From Abroad"
http://finance.yahoo.com/expert/article/yourlife/38424
http://tinyurl.com/2quwp7 (same article, smaller URL)
WRT the growing "Sky is Falling" attitude concerning the national economy: yawn.
Nigel
Truth is alcohol sales will be up in some neighborhoods because some people bought too high and now these's a glut in the housing market.
How much is a short commute to a strong job base (downtown Washington DC) worth? I'm referring to a commute sans automobile.
It is valuable now, and will be worth more in the future. Pity people who drive into DC from Herndon VA.
E.G.
Foreclosure investment refers to the process of investing capital in the public sale of a mortgaged property following foreclosure of the loan secured by that property.
In real estate, foreclosure is the termination of the [equity] of redemption of a mortgagor or the grantee in the property covered by the mortgage. Depending on the type of foreclosure proceeding, the sale may be administered by the courts (Judicial Foreclosure) or by an appointed trustee (Statutory Foreclosure). Proceeds from the sale are used to satisfy the claims of the mortgagee primarily, with any excess going to the mortgagor.
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jackspar.
Home Loans
^\ What was the point of that jaron laden comment? It is unessesarily clunky in it's sentence structure. And in the current market it is unlikely that there are any proceeds left to 'mortgagor'.
The situation I wrote about in 2007involved houses with negative equity, where property owners, were upside down, owing more on the property than what it could sell for.
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