<p>All I can say is that we learn from our mistakes and we pay for it. House flipping is full of traps for mistakes and unless you have a lot of experiences, mistakes are unavoidable. It is for highly trained professionals, probably with contractor backgrounds.</p>
<p>My lesson learned is to avoid City involvement at all costs!!</p>
<p>On the other hand I have noons but myself to blame for the cost overruns which were due to poor estimating on demolition, plumbing and electrical.</p>
<p>^^ And CB, you have a LOT of experiences already…</p>
<p>I prefer “thankless water heater” to “tankless.” Thanks for the giggle, CB.</p>
<p>OMG</p>
<p>Today, I followed 7 houses in auction.com… which had just concluded 5 min. ago. I waited over 2 hours to have the final bids to the penny and I have visited 2 out of 7 that are for sale. These probably are the only few on today’s block whereas a year ago there were 30 in the “area”. I put the stats on the same spread sheet that I created a year ago.</p>
<p>The conclusion: The houses in “good” area are over priced. </p>
<p>Fremont: house sold for 390K Zillow value 360K (I use the name zillow because you know about it but my valuation is from another more reliable source)
Oakland Hills near HWY 13, sold for 746k, zillow value 670K </p>
<p>The one I visited and sold for very reasonable price was Matinez: 228K vs zillow’s 328K
That house needs a LOT of TLC but at least on the surface, you can make “some” money, if you lucky.</p>
<p>I can’t buy any thing near my house. The one sold for $267k, which is desirable because near BART, with a zillow value of $309k. There is no potential for this house, it is a 900 sf house on a 3500 sf parcel. Margin is too thin and it requires a lot of cosmetics, at lease from the outside.</p>
<p>ALL the above houses are owner occupied and can only be viewed from the outside. To get rid of the owner is PIA, either lots of cash for keys or legal bills.</p>
<p>How do you find those final bid amounts? Every time I watch something on Auction.com it appears like it is getting auto-bid up by the lender/auction.com. Then when the time runs out the dang property just disappears off the face of the earth. I cannot see if it went to 3rd party, back to bank, reserve not met, whatever! I probably do not have enough patience to wait a couple of hours or something.</p>
<p>I am seeing a pattern in the foreclosure auctions, and Auction.com, that banks are setting much higher opening bids or reserves - usually way too high for investor purchases. The bank BPOs (Broker Opinion of Value) is usually at least 2-3 months old. We know that the market was good in August and then started dying back down. So, they are setting their opening bids based on the rising market this summer, not the stagnant market right now.</p>
<p>Coralbrook, are you already looking for your next deal?</p>
<p>I just looked up on MLS, for the same amount of money, I can buy comparable homes, vacant and ready to be inspected vs from auction.com. People now got the wrong impression that buying from Auction is always cheaper. The owner occupied homes are real gambles, whereas you can wait and buy from MLS with ease. It is the frenzy from 2007 over again.</p>
<p>“How do you find those final bid amounts?”</p>
<p>You have to be on top of the bidding process, as if you were bidding yourself. The rules are as follows:</p>
<ol>
<li>When the announced time is up, the last bid got 2 min. wait time for others to respond.</li>
<li>When the new bid received, that became the high bid and 2 min. was extended for the under bidder to respond.</li>
<li>It goes on like that until the high bid does not get out bid in 2 min. You have to be on top of it to record the final bid, because it says GONE! on the web site.</li>
</ol>
<p>The bidding process could go for a LONG time, depends if there is high bidders on line to bid. I waited from 2:30 to 4:00 to record the last bid on the 7 houses.</p>
<p>For heavens sake, the final bid time should be a cutoff like any other online auction. They just drag it out forever. They are masters at trying to get people to bid higher, just like their live auctions with the tuxedo guys.</p>
<p>No, cannot look for my next deal until I get my capital back from the sale of this house. Sometimes I can get a swing loan from a private investor if I am in escrow on my property, but I’m not putting any feelers out yet since I’m not in contract on this house yet.</p>
<p>I don’t think the Bank is shill bidding(that is what called) in Auction.com, the bids you see are real bids. Bank do put a reserve on the item, if the bids did not reach the reserve, the bank may reject the high bids in two weeks. They have plenty of time to research the market to decide if the high bids are good or not. One house in Berkeley went back to auction block for 5 times last year and I am not sure if the Bank finally sold the house or not.</p>
<p>Sounds like things are slowing down…except on auction.com. I dont want to see another bubble.</p>
<p>We are rooting for you, CB. You’ve worked hard and done a nice job!</p>
<p>I don’t see another house bubble in the Bay Area for at least 4 years.</p>
<p>The home price dropped like a rock in 2008 until April 2013, that was the longest drop in American history. Things just turned around after 04/13, majority of the increase is from Palo Alto as the ground zero, from there there is a ripple effect, so the Menlo Park and Mountain View got the wave higher than other places. Other than Marin County, the ripple effect is now engulfed the entire Peninsula. East Bay is starting to get the effect, but the outer areas has not feel the true impact. It will come and this upsurge will last for at least 3 to 4 years.</p>
<p>Housing market is not like stock market, ppl need housing to live, when they bought a house, most likely they will stay there for few years, trading are less frequent, therefore the effects on price change are not as drastic as stock.</p>
<p>Ok artloversplus. I hope you are right.</p>
<p>Broker Open House today and I’ve asked my agent to try to get input from the local agents on our pricing. Based on the fact that we don’t have any interest yet that tells me that she was dead wrong on her opinion that there was “pent up demand for the pocket neighborhood”.
What this means is we will have to wait for that one buyer who wants this area and willing to live in small sq ft house. It may be a long wait!</p>
<p>Hold your horses for a while. I should kick myself to exit the house with lunatics too soon. I bought it for 130K and spend about 10K to get rid of those lunatics, plus few thousand to clean it up. I sold it for 207K cash, AS IS, without even paint it or fix the deck for safety. I left the kitchen floor with dried glue, the guy botched up the lipstick job three hours before open house and I have to let it go like that. Great profit! Right? I just looked up MLS and similar house is selling 300K+ right now! And what did I do? I turned around and bought this current duplex for 160K, put in at least 70K and is selling 350K. What a nut I am! I could just sit back on the nut house collect rent and earn the same amount money.</p>
<p>Ok artloversplus…let’s not complain too much about making money. ;)</p>
<p>Today, went to see two houses on MLS close to me. Was wondering why they were not sold in about a month(one is 53 days). When I walked in, I know what is it…Foundations, and that is a bad word. Because these two are in the same block as the one sold for 267K in auction.com, I am wondering if that has foundation problems as well. If so, the guy bought it is going to kill himself, the reported 900sf is actually 760sf, the rest is un-permitted and also foundation problem? That will eat up the margin very fast.</p>
<p>We are at the final stage of closing, but the deal is stalled. No matter how many times we called the buyer, he is not signing the contingency removal and the disclosures… Well, send him a notice of cancellation today…</p>