Flipper Alert: Buy From the Bank, Re-list for $54K More: 1540 N. LaSalle in the Gold Coast
The flippers are back!
We first chattered about this phenomena with a 1-bedroom unit at 600 N. Kingsbury in River North.
Unit #814 was bank owned and sold in August 2009 for $200,000 (with the parking). It was then re-listed for sale in October 2009 at $238,900 (plus $29,000 for parking).
It’s still available.
See our 600 N. Kingsbury chatter from October 2009 here.
This latest flip is also a 1-bedroom unit, but in the Gold Coast at 1540 N. LaSalle.
It came back on the market just 5 days after being sold by the bank.
It’s a junior 1-bedroom with west views. There’s no parking and no washer/dryer in the unit. But there is central air.
The listing says “this is not a short sale, just an excellent value.”
Will flipping foreclosed properties be the new game in town in 2010?
Andrew Lewis at Andrew Lewis Realty has the listing. See the listing here (no interior pictures).
Unit #1806: 1 bedroom, 1 bath, 725 square feet
- Sold in April 1996 for $64,500
- Sold in July 2005 for $180,000
- Lis pendens filed in October 2008
- Bank owned as of June 2009
- Listed in August 2009 for $131,900
- Reduced
- Listed in October 2009 at $121,900
- Sold in December 2009 for $105,000
- Listed five days after closing for $159,000
- Assessments of $429 a month (includes heat, a/c, cable, doorman)
- Taxes of $2509
- Central Air
- No parking
- No Washer/Dryer in the unit
- Bedroom: 12×9
- Living room: 9×12
- Kitchen: 10×9
At the $105k price, this would be barely positive at $1200/month. Seems a little rich, no?
And $105k is right on 3.5%/year over the ’96 price. The flipper is nuts.
Interesting how this unit gained an additional 50 sq ft to become 725 sq ft since the listing for the previous short sale (courtesy of Redfin). In my earlier days as a GC/LP studio investor I saw a couple of studio units in this building. They are basically 550-600 sq ft with some having a divider wall delineating a bedroom area and a living area. The fact that someone paid $180K for this in 2005 is unreal and indicative on how inflated even the lower end became. Based on the unit’s condition I would value it at approx. $140K. Definitely NOT enough for the specuvestor to make the large profit after taxes he/she is hoping for.
Listing now has pictures so we can all see the dated kit & bath. Floors look in good condition and there are newer appliances. The price is rather low, but it is a small unit.
I’m not a big believer of 1 bedrooms as condos, 1 bedrooms are rentals.
This could make sense for a recent grad using an FHA loan- I’m assuming most recent grads wouldnt have the savings for a real down payment.
“I would value it at approx. $140K”
$140k o/o, or as an investor?
Based on what I’ve observed lately $140K is a good approximation of the actual market value whether it’s o/o or for an investor.
Haha, I actually lived here, in this unit, about 10 or so year ago!
The unit is about 700 sq ft. There is a dressing area that connects the bedroom to the bathroom.
I would guess the actually measurement for the bedroom including this dressing area is closer to
9 by 18
I still don’t see how this is 725 aq ft, let alone 700. Add up the area of each room and you get 306 sq. feet.
Not sure either but I enjoyed renting there for 9 months! I got into a dispute with owner about the parking space and moved out-Lease was month to month
Great location
“I still don’t see how this is 725 aq ft, let alone 700. Add up the area of each room and you get 306 sq. feet.”
The windows are ~4′ wide; there appear to be 3 in the LR and 3 in the BR, so 24′ wide, max. I can’t see how it’s more than ~25′ deep, which gets you to 600sf.
David… mind telling us what your rent was back then?
$925/month including parking
Then, landlord removed parking from equation (long story-bad idea doing month to month lease) so I rented parking at Piper’s Alley for about 175/month
Finally, that got too annoying and I moved out
Those “vistas” are really something. Not.
The buyer got a deal at $105K and then got greedy. If you’re looking to make $54K on the place in a matter of days at least bring the shitebox out of the 80s. Nice pictures by the way — if you are looking to dupe someone into giving you a huge windfall, do a better job. Here’s a realtor/flipper that plain old sucks.
We can only hope these flips result in no profit or a loss. Greedy specuvesting is what caused so many problems in the first place.
Wow, this flipper is audacious. The ink hasn’t even dried on the deed, much less been recorded, and the unit has already been relisted. Amazing, this flipper must not be able to get a real paying job, because nobody would do this flip unless they were really desperate for income and profit.
I wouldn’t be so angry at the flippers as they are just speculating and providing liquidity to the RE market on the way down. I am angry with our government for continuing to provide extremely high LTV (96.5%) loans to people and shouldering their risk via the FHA.
If our government makes the value judgment to continue to provide people with insane leverage that the private sector is not currently doing, the flippers are just speculating in an environment where either they win or the taxpayers lose. Completely economically rational behavior.
FHA currently comprises over 45% of all new mortgages and it is absolutely the new subprime.
” I am angry with our government for continuing to provide extremely high LTV (96.5%) loans to people and shouldering their risk via the FHA.”
It’s all about getting the unemployment rate down.
Farther drops in the value of houses will have a negative wealth effect on consumption and therefore retard the recovery. Increased purchases of houses will reduce farther price drops, and if they are strong enough, will even stop the drops. And when new construction is involved, increases in expenditures on them will stimulate additional new construction and directly create jobs. Therefore encouraging purchases with easy credit is rational economic policy.
The lost output and income that occurs when the economy is far below full employment involves many trillions of dollars and these losses can never be recovered. These far, far exceed any losses that could result from the current loan policy. Worrying about the losses that could result from this credit policy instead of the huge losses in output and income that result from the economy being far below full employment is a classic case of being penny wise and pound foolish.
CaptainVideo,
I had to read your post twice to decipher your bull$hit. What you’re basically saying is that it’s better to lose money by selling homes to people who can’t afford them and to build new homes that we don’t need, because that’s better than the alternative which is the “lost output and income that occurs when the economy is far below full employment involves many trillions of dollars and these losses can never be recovered.”
I call Bull$shit; this is a bunch of academic nonsense that sounds all fancy and mighty and maybe according to some mathematical model with lots of letters and symbols it works but in the real world, building empty homes and lending money to deadbeats is what got us into this mess in the first place.
Talking about employment today, the talking heads are going bananas over the supposed ‘improvement’ in employment.
Well the headline unemployment number doesn’t include people that have now gone into the extended benefits (Thanks Barack!)category. People that are getting extended benefits increased 200K this past week to over 4.82 million.
If you include these people, which I have no idea why you wouldn’t include them, we now have over 10.2 million people receiving unemployment checks from the gubbernment. That is a new record high!
CaptainV is right insofar as if the investments were positives; unfortunately I would have to agree with HD, productive investments will be outside of housing; like energy/infrastructure.
Happy New Year to all.
I saw the talking heads today too on a TV at lunch-time (why they have to have a Communist News Network TV with talking heads at a bar-restaurant is beyond me). I was quick to point out to those in attendance that there is a WSJ article today (page C1) that shows this breakout and that the combined rate is steadily climbing.
Ted Turner and his cronies continue to paint the administration as the Messiah who can do no wrong and continue to push propaganda onto an unsuspecting and largely stupid populace.
5.6MM who have given up looking for work and not counted on either regular or extended benefits. 4.7MM on extended benefits. ~5.0MM on regular benefits (article states just over 5MM). Thats 15.3MM unemployed. Not even counting the vast swaths of underemployed.
“I saw the talking heads today too on a TV at lunch-time ”
At the bar, or a booth at Monk’s? And did you have three or four?
Bob…
Your reactionary demagoguery is embarrassing….you really think that any right-minded individual would blame Obama for the mess were in and not 8 years of republican control of the executive branch and complete control of congress or at least one of the chambers since 1994? Please, Obama has absolutely nothing to do with the situation were in… I believe congress from both sides of the aisle as well as both the Clinton and Bush admins enabled our financiers to create this perfect storm…
so, stop embarrassing your self, please….
Collection of unemployment benefits – extended or not – is not a criteria for being counted as unemployed. It is being jobless, looking for, and being available for work.
More detailed information on the collection of the data is at http://www.bls.gov/cps/cps_htgm.htm#unemployed
An interesting paper on unemployment rates is at http://www.bls.gov/opub/mlr/1995/10/art3full.pdf
Jay,
Believe it or not, and this might indeed be a shocker to you: people tend not to report their unemployment status to a government agency unless there is an incentive to do so (ie: unemployment benefits).
I know it sounds insane right?
“you really think that any right-minded individual would blame Obama for the mess were in”
jack,
While you certainly use big words I think your reading comprehension is a little lacking. You should demand a refund from your liberal arts school: they might teach vocab but they’re not so good in the “we’re” or the reading comprehension department.
It matters little how we got this point jack it matters how we deal with it and the current administration is just a hollow shell beholden to lobbyists and special interest groups. Business as usual in Washington.
Bob,
This might not be known to you – unemployment numbers are collected by a survey of 60,000 households monthly, about 100,000 people over 16 years old. The first contact is in person while the next can be by phone. Most national surveys use about 3,000 individuals.
Will people lie about their employment status? Probably some will, but which way? Some will be so ashamed of being unemployed that they will claim they are employed. Others will be working underground and will claim to be unemployed.
Bob, the best you can do is criticize my punctuation on a blog comment? (thank god this thing has spell check built in now)…
If you think it doesn’t matter how we got here, then you are not only a demagogue, you are a fool…
The flipper should actually flip this unit by remodeling the kitchen and bath.
This unit is now under contract. I don’t know the negotiated sale price, but the list price was eventually dropped to $147K. Considering that the flipper purchased it as a foreclosure for $105K, he/she did all right for this market. Is this a sign of things to come (i.e. new breed of flippers)???