HOUSES OF CARDS
Slowly but surely the collapse of the real estate market is showing its ugly head in our neighborhood.
Signs "For Sale" are sprouting.
The thin financial facades of the flippers, the over achievers, the aggressive developers and, sadly, the overextended are slipping.
Since no one in their sound mind would have a house for sale at this time, the signs are of the times, not the usual good happy reason to be moving from one home to another.
The guy who bulldozed a perfectly good adobe house illegally and then built a huge inappropriate craftsman house is the latest on the block. The sign went up today. Obviously capitalized on the value of the property, it no longer is enough.The guy down the street who works for the Follies has his house for sale along with another one over in a high end development that he bought for speculation. They can't carry both. Whichever sells first will tell them where they live. Neither is selling.The flippers and re-doers who live down the street and then bought a second house in the neighborhood before the first one sold are still sitting with two houses. They have put the second one on the market before the first one sold.A friend who, until a few years ago knew nothing about real estate or development, has his fourth house sitting for sale, now a year, just on the next street. It is sad to see. It is actually being sold by the bank now. He hit the magic foreclosure number about two months ago.Just down the street from him, a couple were foreclosed about 6 months ago. It has always been a hard luck house. Now, it is sitting without any movement at all.A fast track developer built on two of the few empty lots in the neighborhood. Artsy, over the top houses that have to have very limited appeal. Both are sitting still and the first one finished keeps starting into escrow and then falling out.Down the street a really arrogant son of a bitch (I have met him) bought a wonderful house for a million dollars, scalped a beautiful hilly green back yard of top soil and built even more house. His selling price over 3 million. There is only one other house in the neighborhood that is worth 3 million and that may no longer be the case. The renovated house sits quietly, soulless.Further down the street a woman who threw her son out of her house (she lives in Nevada) is selling privately. No takers.Next door to her, a small and very expensive (when it was bought) gem is for sale by a guy who surely went in over his head. We knew him moderately well. Have been to his house for little parties a few times. Visits while walking the dogs. Met his mom. No clue anything was up. No one seems to be living there.It is not all sad news. A few homes have sold here recently.
It is a bit depressing but very few of the people involved here are innocents. They were playing with the market and they got burnt.
It is too bad. But it can't be helped.
The neighborhood will survive. Pretty soon, the prices will drop to a point where there will be buyers and the houses will be 'saved'.
The cycle will start again.
When we moved here in 1997, it was at the end of the savings and loan disaster which hit Southern California very hard.
There were 'For Sale' signs everywhere. In those days, no one put up a foreclosure sign. Today, that is not the case. It is right out there. It moves the offers!
There are still not as many around as there were then. It is not that bad. Yet.
We bought our home at depressed market prices. The people had to get out.
They already had left and were lucky to be renting it.
Cycles.
What goes up must go down but the converse is also true.
What goes down must, eventually, go up.
Labels: market
