55% Under the 2005 Purchase Price in Buena Park: 732 W. Bittersweet
This studio condo at 732 W. Bittersweet in the Buena Park neighborhood of Uptown has been on the market since last March and is now listed about 55% under the 2005 purchase price.
The vintage building was converted into condos in 2005.
It doesn’t have central air (room units only) but it does have hardwood floors, a stainless steel refrigerator and granite kitchen counters.
At this price, does this make sense as an investment unit?
Christopher Sterling at Prudential Rubloff has the listing. See the pictures here.
Unit #503: studio, no square footage listed
- Sold in July 2005 for $125,500
- Originally listed in March 2009
- “huge price reduction”
- Currently listed at $54,000
- Assessments of $200 a month
- Taxes of $1690
- studio: 18×11
- kitchen: 11×5
- No Central Air (room unit)
- No in-unit washer/dryer
- No parking – rental in the neighborhood
I remember looking at these units right after the conversion and thinking they were small, but nicely done, and with a good location and great views. They were even including a murphy bed with the studios at the time.
I was in the area a few months ago and noticed some serious work being done on the exterior – looked like some of the old brickwork was falling apart and steel nets had been wrapped around parts of the building to prevent chunks from falling on people. I’m no expert, but it was a sight that screamed “special assessment” to me. Anyone else know about the “renovations” going on here?
Will some of these more marginal conversions end up being rental? Methinks a tiny studio or miniscule one bed is not suitable for condo conversion to begin with. These are some of the smallest apartments I’ve ever seen. There’s virtually no closet space and the units feel claustrophobic, and the “vintage charm” was long ago clean-walled right out of these squeezy little boxes.
I first looked at this building nearly 20 years ago, when the surrounding neighborhood was just emerging from slumhood. Yes, this was the Badlands until the early 90s. This building had just been renovated as rental and rents were modest. I also remember, that at that time, the real estate mini-bubble of the late 80s was deflating rapidly, and a number of buildings in Uptown de-converted and are rentals to this day.
Somehow,
Hey Laura:
What was the asking rent here when you looked? Any recollection?
It’s shocking that someone paid $125k for this.
I don’t really get what the market is made up of people that would want to purchase little studios like this. I’m sure there’s an element of the suburbanites that want a place to crash in the city, or maybe someone that can live an incredibly Spartan lifestyle and wants to live in a nice(r) area and this is the best they could afford. Other than that, I don’t know. For the amount that you’d pay in mortgage/assessments/taxes I’d imagine you could rent something far nicer. Not hating, just curious.
Anybody know what a fair rent would be on this place?
One of my friends rented here; it was tiny and bland – and not terribly cheap from what I recall, plus electric heat. Like $725/800 for two rooms with a kithenette in the living room, roughly seven-ten years ago. Good views higher up though.
Developers have tried and failed.
See the 1150 ish N. Lasalle studios.
Then there is another set of studios on 1300-1600 n lake shore dr?
—
“Anybody know what a fair rent would be on this place?”
Similar studios:
1101 rented 1/4/2010 $700
901 rented 9/12/2009 $800
1101 rented 8/19/2008 $850
1101 rented 5/1/2008 $850
603 rented 5/16/2007 $900
Small 1BRs:
707 asking $975
607 rented 7/1/2009 $950
602 rented 5/13/2009 $950
1101 rented 1/4/2010 $700
1101 listed 9/21/09-11/23/09 $799
1101 listed 7/21/09-9/21/09 $825
That’s awesome. 1101 probably sat vacant for a few months before accepting $700 in rent rather than holding out for another tenant to pay $850 in this market. The number of college grads moving to the city must be dwindling because they usually rent places like this quickly. No jobs, no rent.
1101 rented 1/4/2010 $700
1101 rented 8/19/2008 $850
1101 rented 5/1/2008 $850
And I was right….
thanks G.
“1101 rented 1/4/2010 $700”
If 503 could get the same $700 rent, that’s a decent return at the asking price. Not that buying individual studios is a smart way to mini-land-baron status, but the seller definitely wants the place to move, if that’s a real asking price.
1101 has a nice lake view and 503 is lower and faces south.
1108 is studio currently asking $60,000
901 is studio foreclosure closed in 8/09 for $49,900
“1101 has a nice lake view and 503 is lower and faces south.”
So, 10% for the view? (seems a steep discount to me) $630/mo for #503? ~$47k, then–which still puts the ask in the range of potentially negotiable.
“That’s awesome. 1101 probably sat vacant for a few months before accepting $700 in rent rather than holding out for another tenant to pay $850 in this market.”
I just sent off a letter to my LL demanding $110 rent decrease at lease renewal with a copy of an ad where he was offering this lower rate two months ago.
Massive price deflation in rents, which will ultimately prove the deflationists right as owners equivalent rent is one of the largest components of it.
“Massive price deflation in rents, which will ultimately prove the deflationists right as owners equivalent rent is one of the largest components of it.”
Deflation in rent in the US b/c of oversupply.
The other question however is WHY IS THE REST OF THE WORLD’S HOUSING MARKET IN A BUBBLE? It makes no sense to me.
http://www.housepricecrash.co.uk/newsblog/2010/01/blog-china-house-prices-are-x-earnings-makes-the-uk-look-quite-affordable-27107.php
(only one link sorry I’m going home now.)
Why is it so hard to believe that China’s home prices are in a bubble? The situation over there is very different, and the collective free-market experience of the country is quite limited. They have known stagnation and boom and nothing else — some have only known boom!
But what I want to know is, why is CANADA in a home price bubble? (
Whoops! Got cut off. Should have said, “According to Dave Rosenberg”
Interesting link, HD. Have passed it on to my Beijing expert to comment on.
Canada is not in a bubble. Assessed values have dropped for two straight years in Alberta. Things are slowly on the upswing again though. Real estate in Ontario has been hit hard in some areas due to auto plant and other industrial sectors getting hit.
From his “Special Report: Is the Canadian Housing Market in a Bubble?” I myself don’t have a dog in this fight.
Is the Canadian Housing Market in a Bubble?
It sure looks that way.
At a time when personal income is down around 1% over the past year, we have seen nationwide average home prices soar over 20% and last month hit a record high; as did home sales. In real terms, home price appreciation is back to where it was in 1989. Of course, back then, interest rates were far higher but then again, the economy was in the late stages of a phenomenal multi-year economic expansion, not making a transition from deep recession to nascent recovery.
We are in no position to make a claim that there is a high degree of speculation in residential real estate as there was during the “flipping” mania of the late 1980s. Be that as it may, housing has become a very crowded asset class in Canada, as measured by the homeownership rate, which at last count was estimated at 68.4% which is not only a full percentage point higher than the current U.S. ratio but is the highest it has been on this side of the border in nearly four decades.
Bunch of draft dodgers…
Also something interesting I found out tonight… I had no idea you could deduct PMI on your income taxes! Considering I didn’t pay closing costs or up front PMI that was a nice surprise on my Tax return.
“Also something interesting I found out tonight… I had no idea you could deduct PMI on your income taxes! Considering I didn’t pay closing costs or up front PMI that was a nice surprise on my Tax return.”
This deduction phases out after $110K or so in income (if you make more than that- you’re out of luck.)
I think I rented 1004 in this building in 2007 for $725. You could hear the organist warming up for the cubs game during the afternoon. Pretty nice. Parking was tough but right off the lake for a decent price.
I want my parents to buy this… perfect situation for them. They are retired, live out of town, and could spend a few months (summers) in the city to be around their new grandson (and oh yeah, us too:). It’s walkable to our place in Lakeview East, and close to the lake for walks/bike rides/tennis. Perfect! I’m sending it to them now.
I know it’s small, and Buena Park isn’t for everyone, but wow – that’s cheap. I can see the ‘retired couple’ scenario outlined above happening. I could also see wealthier parent(s) buying this for their kid who’s going to DePaul or Loyola or even Colombia College. It’s right by the red line.
If you have a kid at Loyola, you’d do better buying her a place in Edgewater.
Edgewater is where Loyola is located, Edgewater is cheaper, and Edgewater has better retail within an easy walk of most of the condo buildings there.
Edgewater is even a little safer than Buena Park.
Stay far away from this building. Developers did a shoddy cosmetic renovation and ignored structural problems when the building went condo. There are extensive problems with the facade. Repair will cost in the millions – (I’ve heard estimates of 2 million and 4 million. Either way, it’s a lot.) Yes, this is being paid for through a special assessment. Owners will be on the hook for about 50K each. That’s why units which sold for over 100K are going for 50K now.
More like, that’s why units which sold for over 100K shouldn’t be going for 50K now.
If a special assessment of 50k is assigned how exactly is that financed by the owners? Sounds to me like even if the HOA does the financing thats a huge cash flow hit to somebody stretching their budget to buy a condo with a low down payment.
Oh man, what do people do in this situation? It will never sell… AWFUL situation.
When I first saw these units as condos, the ask for the tiny 1 bed was $156K and the studios were around $130K. That was a few years ago.
$50K for a studio would be reasonable if the building did not have any major structural problems.
But if it needs a facade renewal that will cost an average of $50K a unit, you have to question whether you want to own it at any price. That bumps the true price of the unit to $100K, which it is nowhere worth. And what other problems does this building have, that will cost owners big bucks down the road?
Another thing, the main thing about this building, really:
This building was converted c.2005. The facade problems that this bldg has that are so expensive to repair did not develop within the past five years. They had to be there to begin with.
Now, in order for the units to be offered for sale and occupancy, and for buyers to get financing, this building had to have passed city inspection. Also, the lender would require the buyer of unit to have the unit and building inspected. Why were these flaws not found? They did not get there withing the past 10 years.
Sounds like this is another case where city inspectors definitely did not do their job, and neither did the lenders.
I hate to say this, but this sounds like a situation where the original buyers are morally entitled to walk away from their loans, and should be taking action against the city for passing this place. If I had purchased the place with the assurance that it was approved for occupancy by the Bldg dept and met all applicable codes , and furthermore, subsequent inspections required by my lender revealed no problems, do I have a legitimate grievance when costly problems that had to have taken decades to develop, are revealed, and the cost of mitigation will break me? The original buyers of these units are probably youngsters on moderate salaries and a $50K per unit assessment will doubtless push them right over the edge.
But, but, rent is just throwing money away!
The city’s facade inspection ordinance is likely not liable:
“The intent of the ordinance is not to determine whether a facade will fail, but rather it is to identify any “unsafe and imminently hazardous conditions” with keeping economic in mind. The only method to eliminate risk and guarantee that no failure will occur would be to remove all facade components, inspect for deficiencies, repair deficiencies, and re-install the components. For building owners this would be a cost prohibitive measure.”
None are so blind as those who choose not to see. Hopefully, the youngsters will learn and pass the lesson along to future youngsters.
The CITY does not perform the actual inspections and only 25% of the facade (of each facade) was required to be inspected. It’s likely the repairs are due to the inspection report (assuming that the information given here is correct). However, they could indeed develop within a few years to the point of being detectable – it only takes a few years and lack of maintenance which many condos are prone to (rental buildings tend to manage this better since there is no board to fight over expenditures). The watering down of the city ordinance is going to result in a lot of problems in the future since all it requires if a building is safe or safe with repairs will be a binocular inspection every few years.
I have been lurking on this site for a long time but only now feel compelled to post. I looked at this building back in 06 and literally RAN out the door. I looked at a one bedroom and a studio (with murphy bed) and they were so cheap looking they looked like dollhouses. In theory this would be great for a retired couple or out of towners who need a city escape but they were just SO SO cheap. I must admit that the pictues look ok- but in person it is just terrible.
Unit #401 just came on the market yesterday for $50,900. It’s a 1 BR. 2008 Taxes were $1318 and the assessments are $462. MLS 07719510. There are photos with the listing if you are curious. But I would not touch that building, personally. Too many structural and management issues.
Unit #1106 was reactivated in MLS today for 54.9K. It’s a 1 BR. 2008 taxes were $2,070. Assessments are $463. MLS 07671825.