Potential Bargain Property July 8th 2006

| | Comments (0)

General: El Cajon, 3 Bedroom 2 bath, asking price range $475,000 to $500,000.



Why you should be interested: Large 3 bedroom home close to everything - two right turns to freeway, 15 minutes to Mission Valley. Walk to shopping, but on a quiet street.



Selling Points: Nice solid home in area with some upscale.



Why I think it's a potential bargain: They've got some nice features, but the tenants leave clutter everywhere. It's hard to walk around the home, it's so cluttered. This is an emotional push away for buyers. Been on the market six months through a discount listing service. It's like every major push away for potential buyers going. Once the tenants are out, however, that's a different story. The appliances could use an update, but they're basically solid.



Obvious caveats: Outside, I could hear the freeway. Inside, I couldn't. I'd also say that the current owners are likely too greedy, but after it's been on the market this long, they may be ready to see reason.



Why it hasn't sold already: Because of the clutter and the fact that the discount listing service doesn't do anything for sellers. Just getting the tenants out would increase the value. It's also small for the area, and the asking price is too high given the comps. Also, since you can just barely hear freeway noise outside, that's a real push away for some folks.



IF you put zero down and if you pay full asking price (which you won't), your payments would be (Principal & Interest) would be $3031 with a fully amortized loan (Assumptions: $391,200 1st at 5.75% 30 year amortization fixed for 5 years APR 5.976, 2nd mortgage $97,800 at 8.45% 30 year fixed amortization with a 15 year balloon APR 8.471, on approved credit, not all borrowers will qualify).



With a 20% down payment, even if you pay full asking price, payment drops to $2251. ($391,200 1st mortgage at 5.625% rate 30 year amortization fixed for 5 years, APR 5.849, no second. On approved credit, not all borrowers will qualify)



If you keep it ten years and it averages only 5% annual average appreciation per year: It would be worth approximately $796,000. Your equity, using the zero down payment scenario described above, would be approximately $385,000. As opposed to a $2200 per month current rental and investing the difference at 10% per year tax free, you would be approximately $220,000 ahead of the renter after the expenses of selling.



Fact you should be aware of: The reason it's a bargain is because most people will see only the clutter. This is an area with some upscale, and this is one of the smallest most basic homes in the area, so there is potential for improvements to be worthwhile.



Call me. Action Realty 619-449-0723, ask for Dan.

Delicious Bookmark this on Delicious StumbleUpon Toolbar Stumble It!
Please be civil. Avoid profanity - I will delete the vast majority of it, usually by deleting the entire comment. To avoid comment spam, a comments account is required. They are freely available, and you can post comments immediately. Alternatively, you may use your Type Key registration, or sign up for one (They work at most Movable Type sites). All comments made are licensed to the site, but the fact that a comment has been allowed to remain should not be taken as an endorsement from me or the site. There is no point in attempting to foster discussion if only my own viewpoint is to be permitted. If you believe you see something damaging to you or some third party, I will most likely delete it upon request.
Logical failures (straw man, ad hominem, red herring, etcetera) will be pointed out - and I hope you'll point out any such errors I make as well. If there's something you don't understand, ask.
Nonetheless, the idea of comments should be constructive. Aim them at the issue, not the individual. Consider it a challenge to make your criticism constructive. Try to be respectful. Those who make a habit of trollish behavior will be banned.

Leave a comment

 



Buy My Science Fiction Novels!
Dan Melson Author Page

The Man From Empire
Man From Empire Cover
Man From Empire Books2Read link

A Guardian From Earth
Guardian From Earth Cover
Guardian From Earth Books2Read link

Empire and Earth
Empire and Earth Cover
Empire and Earth Books2Read link

Working The Trenches
Working The Trenches Cover
Working the Trenches Books2Read link

Preparing The Ground
Preparing The Ground Cover
Preparing the Ground Books2Read link

Building the People
Building the People Cover
Building the People Books2Read link


The Invention of Motherhood
Invention of Motherhood Cover
Invention of Motherhood Books2Read link

The Book on Mortgages Everyone Should Have!
What Consumers Need To Know About Mortgages
What Consumers Need To Know About Mortgages Cover
What Consumers Need to Know About Mortgages Books2Read

The Book on Buying Real Estate Everyone Should Have
What Consumers Need To Know About Buying Real Estate
What Consumers Need To Know About Buying Real Estate Cover
What Consumers Need to Know About Buying Real Estate Books2Read

Dan Melson's San Diego Real Estate and Mortgage Website

↑ Grab this Headline Animator

About this Entry

This page contains a single entry by Dan Melson published on July 8, 2006 12:00 PM.

Potential Bargain Property July 6th, 2006 was the previous entry in this blog.

Real Loans As Of 11:40 AM July 10th 2006 is the next entry in this blog.

Find recent content on the main index or look in the archives to find all content.

Powered by Movable Type 4.21-en
******

Enter your email address:

Delivered by FeedBurner


Copyright 2005-2017 Dan Melson. All Rights Reserved