Hot Bargain Property July 26th, 2006

General: San Diego 3 Bedroom 1.75 Bath Asking Price Range $475,000 to $500,000



Why you should be interested: Nice quiet neighborhood, well kept place, large yard, quiet street, motivated seller (the listing agent sounds desperate, to be quite honest). Move your family right into a nice home. Central to everything; downtown and sorrento valley are less than fifteen minutes; mission valley is about five.



Selling Points: Well kept, feels airy. Kitchen is in excellent shape. Yard is well kept and large. Good schools in neighborhood. 3rd bedroom has separate entrance.



Why I think it's a potential bargain: Seller is motivated and needs to sell; been on the market for months. Comps are easily there.



Obvious caveats: The air conditioning is wall mounted.



Why it hasn't sold already: Furnished like a little old lady's house, so buyers can't picture themselves in it. Major price reduction recently. I'd move fast if I were you.



IF you put zero downpayment and if you pay full asking price (which you won't), your payments (Principal & Interest) would be $2939 with a fully amortized loan (Assumptions: 388,000 1st at 5.75% 30 year amortization fixed for 5 years APR 5.978, 2nd mortgage $97,000 at 8.35% Home Equity Line of Credit APR 8.437, on approved credit, not all borrowers will qualify.) Interest only loans are also available to lower the payment further.



With a 20% down payment, even if you pay full asking price (you won't), payment drops to $2264. ($388,000 1st mortgage at 5.75% rate 30 year amortization fixed for 5 years, APR 5.987, no second. on approved credit, not all borrowers will qualify.) Interest only loans are also available to lower the payment further.



If you keep it ten years and it averages only 5% annual average appreciation per year: It would be worth approximately $790,000. Your equity, using the zero down payment scenario described above, would be approximately $380,000. As opposed to a $1750 per month most comparable current rental and investing the difference at 10% per year tax free, you would be approximately $110,000 ahead of the renter, after the expenses of selling.



Fact you should be aware of: I'm not sure how far down the hill your lot goes.



I'm a buyer's agent. I find places like this that can be gotten at bargain prices. I save you money without costing you a penny. Nor are these the only ones I find.



Contact me: Action Realty 619-449-0723, ask for Dan or email danmelson (at) danmelson (dot) com.