Sunday, April 01, 2007

$80,000 saved!

Your continued patience is paying off in the form of some rather significant savings. The following is a listing where you have now saved $80,000., that is approximately $750 a month in PITI you can spend on whatever you want. Keep up the good work!

This home, at 12402 Portebello drive, is listed by Touchstone Real Estate Group with the following heading - "WAS $975,000, NOW $895,000!!!"

The following is the information from the local MLS:

JUST REDUCED! Unique Hard to find attached mother in-law unit in Trinity at Villages of Brimhall Gated. Roberson built custom hm appr. 4,300 Sq Ft w/a gorgeous pebble tec beach entry pool/spa. Home sits on appr. 18,000 sf lot & 5 bd + office, 3.75 ba. Gourmet kit, w/GE SS appl. & Granite counter tops. Master suite w/sitting area, dual fp, wet-bar, lavish btrm w/glass block shower dual vanity, his/her closets, & jet tub. All bdrms are spacious. Living, family & din rm 3 water heaters, 3 AC units.

Click here for more details on this property.


Anonymous said...

I'm finding it hard to believe the concept of million dollar homes... in Bakersfield???

Truly, of all the signs pointing to housing bubble collapse, million dollar homes in this dry cesspool should make it crystal clear that the game is over.

Anonymous said...

It would be interesting to see the selling history on this house, i.e. how much the owner paid for the house and when, etc.

The fact they're willing to chop $80k off gives some idea of how deluded people became by the supposed never-ending price appreciation during the Great Housing Bubble of 2000-2006, and how much 'froth' was built into the price.

I saw a stat that 70% of condos in Florida were bought by real estate speculators; similarly, alot of Bakersfield housing was snapped up by investors, further fueling the insanity...

This seller's probably thinking that $80k discount will get this one to move; hey, no need to get greedy, when they can net another $200k in profits? Remember: prices ran up 275% from 2001-2006.

Even with the discount, they might find it difficult to find a buyer, since the cheap and free money lenders who never said "NO" (until they went out of business) are largely out of the game. The business of usury loans only works when the asset in question (i.e. the home) is rocketing upwards; otherwise, people tend to question paying outrageous rates for money.

But even at that "discounted" price, that over-priced home is STILL an "equity black hole", i.e. the new buyer's mortgage payment checks will go to the lender, but with guaranteed deflation on the horizon (conservatively 5% for the next few years: I suspect worse, for high-end homes), the buyer will watch the "equity" they THINK they're building vaporize into thin air...

Bakersfield Bubble said...

Last anon-

The source I use for my pricing data does not indicate a final sales price.

The assessed value is $625k. The home was built in 2003. Using this information, I would guess the current owner paid around $600k for the house.

Matt said...

That's a nice house, but not super-nice. Only two-fifths of an acre. Something that might be bought by a family in the 96th percentile or so of income. Definitely not the 99th.

What does the 96th percentile household make in Bakersfield? Maybe $200k/yr? So it's a $600k house.

This is the way I'm estimating real house values now.

(1) Estimate what percentile earner would live there

(2) Estimate what income that %ile would correspond to in that area, adjusted for a normal RE market (ie, no inflated croker/ lender/ contractor pay)

(3) multiply by 3, the traditional income to house price ratio.

Matt said...

"croker" should have been "broker" in that last post, but it's still funny.

Anonymous said...

No need to worry, Jesse will take care of us.

There is growing talk of a federal bailout for homeowners drowning financially in debt. The Chicago Tribune reported that:

Amid a 12 percent jump in U.S. foreclosure filings in February, civil rights leader Rev. Jesse Jackson on Tuesday called on consumers struggling with subprime mortgages to take to the streets and urged the federal government to step in and help them secure their homes.

"What we must do now is begin to ask for some bailout of victims of this crisis," Jackson, president of Chicago-based Rainbow/PUSH Coalition, said at a news conference at the University of Chicago's"