Tuesday, July 17, 2007

Lodi Home Auction


Lander said...

Thanks to the reader who sent in this photo.

Jeremiah said...

Well, I'd buy *that* for a dollar....


Sittin' Out This One said...

The last one of these "auctions" I went to, no one even made a bid. The "suggested" price was $580,000 and the highest bid over that got the 2800 SF home. I came back Sunday night just to see the activity. Nothing.

House went into default. The investor/flipper had used some single woman in Fairfield to buy the place because her credit was excellent. 100% 80/20 sub prime. Probably a loan owned by Bear Stearns hedge fund investors!

The end result was the 20% second was wiped out. The lady had her credit ruined and left California. The 80% first mortgage lender took a hit. The property sold to an Asian couple for $450,000 and they rent it for $1800/mon. The couple probably have a negative cash flow of $1,000/mon since buying in Sept 2006.

I drove by the place about 2 weeks ago. Three more houses on the street have dead lawns, one had a NOT document taped to the front door. All will be bank owned and re-sold for under $400,000.

If only the Asian couple had waited, they could have purchase for $50,000 less and passed up paying $9,000 in negative cash flow.

Oh well. That is life on Arnold Drive in Rocklin.

Cmyst said...

I was reading comments on some of the Bee's online business articles, and some azzhat was claiming that serious investors no longer expect to make money for up to 7 years on a rental.
I've gotten lousy returns from my very limited and small stock market investments, but at least they break even. I get 5.05% from my money market checking and savings accounts.
If anyone seriously is promoting this new business model for investing in rental properties, they must be insane.