REO NOT priced to sell at $221/sf

Before we get started on the next post, I just wanted to point out the Comment Tracker on the right-side of this site. It has been reset to reflect on the current month’s comments. It’s more for entertainment than anything else but perhaps SavedbyGrace will reward the monthly top commenter(s) with some free goodies.

**Our sharp-eyed reader has pointed out that this property is, in fact, part of the El Monte School District. Thank you!**

3119 S. 8th Ave.
Arcadia, CA 91006

Price: $639,900 ($221/sf)

  • Beds: 3
  • Baths: 2
  • Sq. Ft.: 2,898
  • Lot Size: 8,902 Sq. Ft.

This is an REO property located on the border of Arcadia and Monrovia. The listing claims that it’s part of the the Arcadia school district but I would definitely double check before even considering this home. Heck, take a look at its location and you will have to double check the city.

From the listing:

REO – Lender Owned Property. Sold As Is, Where Is, And With All Its’ Faults. No Warranties Expressed Or Implied!

Despite its large size of 2,898sf, $639,900 is asking way too much for this property. Take a closer look at the following aerial photo and tell me what that ‘runway’ is behind the back yard. Possibly a drainage ditch? Yes, this property comes attached with many faults…

Sales history:
May 1995 $269,449 ($93/sf)
Mar 1996 $240,000 ($83/sf)
Jun 2005 $695,000 ($240/sf)
May 2008 $630,724 ($218/sf)

The 2005 buyer bought a home that was worth only a third of the price just 11 years earlier. If it weren’t for the housing bubble, this property wouldn’t go for more than $400,000. In addition to being old (although upgraded), it’s located in a horrible location. Personally, I think $400k is still asking too much.

While the 1996 seller walked away with a $455,000 profit, the latest owner and now the bank(s) will be the biggest losers.

Evaluation based on the last 12 years of ownership:

3%    $342,183    ($118/sf)
4%    $384,248    ($133/sf)
5%    $431,006    ($149/sf)
6%    $482,927    ($167/sf)
7%    $540,526    ($187/sf)

You can definitely rent a nice home with better location and much cheaper than what it would take to carry a mortgage here.

15 thoughts on “REO NOT priced to sell at $221/sf”

  1. Agree with your location comments. Looks like either Monrovia or El Monte schools instead of Arcadia and having a backyard drainage canal is a major turnoff. But the inside of the house look nice. I like the big windows and the kitchen is newer. At $450K, you’re looking at $155/sq ft. I’m no construction expert but with commodity costs today, can you even build a house for $155 sq ft?

  2. Everyone right on mark:

    District Look Up by Address

    Districts matching this address: 3119 S 008TH AVE, ARCADIA 91006
    * COUNTYWIDE
    * 26TH US CONGRESSIONAL
    * 29TH ST SENATE
    * 44TH STATE ASSEMBLY
    * 5TH SUPERVISORIAL
    * 4TH BOARD OF EQUALIZATION
    * UNINCORPORATED
    * UNINCORPORATED EAST ARCADIA
    * PASADENA AREA COMM COLLEGE
    * PASADENA AREA COMM COLLEGE TA 6
    * EL MONTE UNION HIGH
    * EL MONTE CITY ELEMENTARY
    * METROPOLITAN WATER DIST SO CAL
    * UPPER SAN GABRIEL VLY M W
    * UPPER SAN GABRIEL VLY M W DIV 5
    * PUBLIC LIBRARY TAX MEASURE
    * SAN GABRIEL VLY MOSQUITO ABATE
    * METRO TRANSPORTATION
    * FIRE PROTECTION TAX MEASURE
    * L A COUNTY FLOOD CONTROL

  3. Aside from the location, I thought this home was quite charming and decent. $155/sq. ft. will place you right at new construction cost I believe. It could cost more if the builder opts for better materials or use more expensive labor.

  4. Thanks for looking up the data! So this is really El Monte school district. I wonder what compelled the 2005 buyer to paid nearly $700k for this property? Was the bubble-hype so strong that people through reason and logic out the window?

    I think we already know the answer…

  5. I bet the current owner didn’t even bother verifying the school district at the time of the purchase.

    Similarly here in the Pacific Northwest, Bellevue school district is one of the top notch. However, some of the Bellevue addresses/communities actually fall in Renton school district

  6. My one comment is….

    I peg this at $150 to $175 per sqft.

    However, taking a page from the Dr Housing Bubble, can we add probably monthly payment in the appreciation chart. Sure we have to assume a lot, but it would add perspective to the debate, or can someone show me the simple equasion on how to figure this out by myself.

    My reasoning on this, is what level of income would you need to purchase this house… and would that level of income put up with…

    Talked to someone in La Verne, up in the hills, in one of the gated areas, apparently they have two homes that squatters are living in and a bunch of foreclosures/abandoned homes. The squatters showed some level of sophistication because they changed the locks on the house, and apparently the police can’t do anything because the people have keys… someone please verify the validity of this claim…

    Have a great weekend…

  7. Ask and you shall receive…

    3% $342,183 $2,149/mo
    4% $384,248 $2,413/mo
    5% $431,006 $2,707/mo
    6% $482,927 $3,033/mo
    7% $540,526 $3,395/mo

    *Assumptions: 20% down payment, 30yr mortgage, 6.5% interest, 1% annual maintenance, property taxes and tax savings.

    Comparable rents in El Monte for 3+ bedroom homes/townhomes are going for $1,800 -$2,300 per month or less.

  8. To build a cheap home is costs about $80 sq/ft (maybe less depending on labor). Most homes run in the $100 sq/ft range to build. When it comes to upscale homes the price can drastically change. It’s easy to top $200 sq/ft with granite counters, high end flooring, expensive windows, solid wood doors, expensive lights, expensive plumbing fixtures, high end appliances, quality cabinets, etc.

    It’s safe to say that most of the newer home in Arcadia are in the $100 sq/ft or LESS range. Honestly, most new homes around here are of VERY poor quality. (And I have been through many.) The look good at first glance, but at closer inspection the walls are out of plumb, the fixtures are cheap, the trim is cheap, even the bathroom fans are bad, in general they use really tacky crap and they often use the cheapest item at Home Depot.

    I am not saying that you need a master craftsman to build a custom home, but you really don’t get what you pay for in SoCal. It’s so easy to point out stuff that should have been upgraded. But that would add about $10 sq/ft and that comes out of the profit.

    I think the majority of the cost in these homes is the land. You are paying for 365 days of sunshine. And it’s often worth it.

  9. Yes, $155 sq/ft would build you a very nice new home. The issue is the land cost. But when looking a old home don’t consider the new cost to build. An old home is much like a used car. It’s going to be costly to repair. Old homes require a lot of money to maintain. And they are often full of toxins (lead) and asbestos! Thus, the true value of a new home has nothing to do with the cost to replace it. It’s much lower unless the home is really something special. (The picture makes it look like just another cookie cutter crap box.)

  10. Don’t forget that the new Housing Bill will also boost your federal tax standard deduction up by $1000. A winner for renters.

  11. It’s pretty pathetic when sellers lie about school districts. 180 West Duarte Road, Arcadia, CA 91007, MLS ID# W08109807 This half a million dollar home claims to be in AUSD but is actually in Temple City.

  12. Looks like it’s Arcadia USD but it may be one of those bordering / overlapping areas where the city may force you to attend TC:

    District Look Up by Address

    Districts matching this address: 180 W DUARTE RD, ARCADIA 91007

    * COUNTYWIDE
    * 26TH US CONGRESSIONAL
    * 29TH ST SENATE
    * 44TH STATE ASSEMBLY
    * 5TH SUPERVISORIAL
    * 4TH BOARD OF EQUALIZATION
    * CITY OF ARCADIA
    * PASADENA AREA COMM COLLEGE
    * PASADENA AREA COMM COLLEGE TA 7
    * ARCADIA UNIFIED SCHOOL
    * METROPOLITAN WATER DIST SO CAL
    * UPPER SAN GABRIEL VLY M W
    * UPPER SAN GABRIEL VLY M W DIV 1
    * SAN GABRIEL VLY MOSQUITO ABATE
    * METRO TRANSPORTATION
    * L A COUNTY FLOOD CONTROL

  13. 180 west duarte road is directly across from arcadia high school. It’s not anywhere close to TC district lines.

  14. Definitely El Monte school districts. Rio Hondo Elementary, Arroyo High.

    How do I know? I grew up in that neighborhood, from 1958 to 1975. Rio Hondo Elementary 1959-1969, Arroyo High 1969-1973. You can see my childhood home on the small-scale aerial shot: backed up against the quarry-now-lake, right where the current shoreline jogs away from the street grid.

    Back then, it was a blue-collar Levittown built right after WW2. Originally 2BR 1BA 900SF, on 50×100+ lots, with one-car detached garages. At the time (the Sixties), a lot of families (including mine) were adding-on to where there were a lot of 3BR 2BA 1200SFs with backyard pools and two-car detached garages. Still a somewhat-modest working-class suburbia.

    But THIS 2900SF monstrosity???????

    My memories of growing up just got reamed up the ass. AGAIN.

  15. P.S. Though part of the El Monte school district and (at least in the Sixties) on county unincorporated land, the street addresses are Arcadia. That’s probably how it qualifies as Arcadia, though it’s better described as the no-man’s-land between South Arcadia and North El Monte.

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