You Have Until Friday At 5 PM To Make An Offer On This West Lakeview 2-Flat: 1454 W. Wellington
This 2-flat at 1454 W. Wellington in West Lakeview just came on the market.
It appears to be bank owned.
If you’re interested, you have until Friday, January 25 at 5 PM central time to make your “highest and best” offer.
There will be showings on 1/23 from 6:00 to 7:30 PM and on 1/24 from 6:00 to 7:00 PM.
The two units are configured as follows:
- Unit #1: 2 bedrooms, 1 bath, central air, 1-car garage parking, currently not rented
- Unit #2: 2 bedrooms, 2 baths duplex up with “updated” white kitchen and baths, 1-car garage parking, currently rented for $2100 a month
The property is built on a 25×125 lot and the listing says it’s in the Burley school district.
It also says it’s “rarely available” although the 2-flat has been on and off the market for the past 2 years.
The property is currently listed $20,100 under the 2003 purchase price.
Those who have lived in the San Francisco Bay Area know the “best and highest offer” sales tactic well.
Will it work to get a contract on this 2-flat this week?
Kirby Pearson at Pearson Realty Group has the listing. See the pictures here.
1454 W. Wellington: 2-flat, 4 bedrooms, 3 baths, 2 car garage
- Sold in January 1990 for $253,000
- Sold in September 1991 for $196,000
- Sold in April 1997 for $399,000
- Sold in July 2003 for $550,000
- Originally listed in January 2011 for $700,000
- Reduced several times
- Was listed in July 2012 for $599,999
- Withdrawn
- Bank owned (?) in October 2012
- Currently on the market for $529,900
- Offers due by 5:00 PM central time on 1/25
- Taxes of $10,418
- Central Air in the units
- Storage in the basement
Stunning kitchen.
Without looking at the listing, I think the price makes this a good deal. The neighborhood isn’t where I’d want to live, but it is popular, and I’m assuming this could be converted into a single-family without huge effort/expense.
LOL there’s a dog in picture #9!
LOL there’s a dog in picture #9,10 and I think 11!
I think that the assumption that “this could be converted into a single-family without huge effort/expense” is a big assumption. If you are going to do it, you’re probably going to to other rehab and renovation, and that probably becomes a $300k – $500k project pretty quickly. After all, this is a 100+ year old property and who knows what you’ll find when the work starts. At that cost a teardown and new build at $200/sqft may be more realistic an option. The rent that they are getting seems kind of high but maybe $3500 / month total is sustainable. I would not be surprised if this gets some tear-down interest in the middle $400k range, or goes as a rental somewhere just above that. Neighborhood is pretty attractive to people these days, it’s in Burley, but a little far from it, and right across the street from St. Al’s, which may turn some people off, but there are a lot of people who want to be in Burley.
“I think that the assumption that “this could be converted into a single-family without huge effort/expense” is a big assumption.”
Big, and Wrong. Assuming you want to end up with the sort of house that normal people expect for $700k+.
“a $300k – $500k project … new build at $200/sqft may be more realistic an option.”
Retailing at ~$1.3m may be realistic, but no one is going to buy, teardown and contract for new construction at $200 psf here. If this is a teardown, it’ll be a spec build. Also, if torn down, likely cannot build that tall again, tho I haven’t checked the zoning on this block.
“I would not be surprised if this gets some tear-down interest in the middle $400k range”
I’d be *shocked* if it goes below $475.
oh, and:
“it’s in Burley, but a little far from it”
are we really going with “2 full Chicago blocks” = “a little far”? 1 full block north on Greenview, one full block west on Barry, cross Ashland at the light, boom –Burley.
Crossing Ashland *does* suck.
Yeah, I’m guessing $3600/ month total rent. If you wanted an 8% cap rate that would translate to only $410K but in that neighborhood stuff sometimes sells as low as a 5% cap rate (I think they’re nuts) and then you go up to 655K. However, it didn’t previously sell at 599K so the most this is going for is 550K unless the investment market is hotter than even I think.
hmmm . . . I want unders on anon’s $475.
“Retailing at ~$1.3m may be realistic, but no one is going to buy, teardown and contract for new construction at $200 psf here.”
I know of at least one recent example of exactly this very close to here, and I expect that I could find others if I looked. Low inventory gets people to do weird things. If you can afford it, why not get exactly what you want and pocket the $200k+ difference? The two spec all brick SFHs on Oakdale at Greenview very close to here went for $1.5 million each. Those lots cost $400k each and there’s no way they cost $1.1 million each to build, even at “retail” building cost. If you’re quibbling about the $200/sf cost, then, sure, that number might be higher or lower depending on who is doing it, who they have as a general and whether or not is is cost to builder or cost to homeowner, I’m just estimating…
“are we really going with “2 full Chicago blocks” = “a little far”?”
Fair enough, I did say that’s it’s just a little far, and it’s a small attendance area, so this place is further from Burley than lots of the attendance area, especially when you consider the difficultly and relative danger of crossing Ashland. But you’re right, it’s only around .3 miles.
“Also, if torn down, likely cannot build that tall again, tho I haven’t checked the zoning on this block.”
It’s RT3.5, so something about this big, but with compliant set-backs, is no problem at all. The real grandfather rehab candidates are the truly huge ones with a coachhouse.
“I’d be *shocked* if it goes below $475.”
Ok, but see 1450 W. Wellington, 1540 W. Wellington, 1425 W. Oakdale. There are some outliers but for REO and the highest/best, probably with a preference for cash, I don’t see $475k or lower being crazy. I’ll keep an eye on this one – you might be right but I doubt any developer is paying more than $475k to do a teardown and build on spec.
” I doubt any developer is paying more than $475k to do a teardown and build on spec.”
If you think it’d get $1.4-$1.5 as a finished product, I have a bunch of examples of buildings selling for over $475k (in 2012) to spec developers.
This type of marketing ploy irritates me. It reminds me of the Neiman Marcus “Afternoon Dash,” but with a house instead of clothes. It makes sense for clothes, but is just irritating with a house.
TFO, my take is you’re not right about those numbers in this location. In this small area (east of Ashland in Burley), you generally have better locations going for a good bit less than that as teardowns. In other areas, there are different issues and different markets. 1514 Nelson was $360k (18 months ago). The two lots at 1502/04 Oakdale were $400k each (around the same time), and the developer saved more money and probably made more money by doing two at once to by being able to stage development and the sales (although I think that they may have kept the one of them to live in or it’s not on the market yet, or pocket sale or something). We’ll see…
“my take is you’re not right about those numbers in this location”
The $1.4 to $1.5 is based on your number about the oakdale homes.
The rest is generic about what developers are spending on lots and selling spec homes for.
If the spread in this triangle is really under $400k acquisition, over $1.4m sale, then there is an above market spread here. That’s all.
“then there is an above market spread here”
Because RT3.5 = big houses. Thanks for the enjoyable discussion, drinks are on the guy who’s wrong when this sells.
“Because RT3.5 = big houses.”
Seems it’s a market distortion, tho, and someone(s) savvy enought to notice should be willing to pay a bit more. Generally, bigger house = more expensive lot, not *less* expensive. Tho the biggest house built near me in the last 3 to 4 years also have the cheapest (non-fatally-compromised) lot to sell near me in the same time frame.
““are we really going with “2 full Chicago blocks” = “a little far”?”
Fair enough, I did say that’s it’s just a little far, and it’s a small attendance area, so this place is further from Burley than lots of the attendance area, especially when you consider the difficultly and relative danger of crossing Ashland. But you’re right, it’s only around .3 miles.”
You need to get a map of the attendence area. More of it is east of Ashland than west. It only goes to Ravenswood on the west, but goes as far as Racine on the east, with much of the east border being Racine or Lakewood. It also goes as far south as Diversey and north to School.
ill take the over on tfo’s 475. I say it’s 50/50 chance it’s a tear down. depends on which cash buyer is wiling to sacrifice a few dollars more…. hell, teardown lots on damen ave in bell were going for 450$ back during the boom and this is arguably a better lot and a better condition tear down. I’m no Re bull and I’m not intimately familiar with the burley submarket but this seems to be reasonable.
what’s a better condition tear down?
This is frame so I am not gutting right – its totally going down?
so why does it matter?
I’ll take the over on that $475 fit sure. It’s going to be torn down & I’ll bet there are 5+ offers on it already. Land has been tough to get the past couple months & many builders will buy just about anything…. Yes, we are there again
“Seems it’s a market distortion, tho, and someone(s) savvy enought to notice should be willing to pay a bit more. Generally, bigger house = more expensive lot, not *less* expensive. Tho the biggest house built near me in the last 3 to 4 years also have the cheapest (non-fatally-compromised) lot to sell near me in the same time frame.”
You’re missing the point. Compared to the other newly-built $1.5 million houses you are thinking of, this area (in general – maybe you are thinking of houses in some areas that are RT3.5 as well) allows for bigger houses. Since the houses can be bigger, more of that $1.5 million is the construction cost. In the areas you’re comparing it to, a newly-built $1.5 million house has, comparatively, a bigger component that is the land cost. There’s a separate question of how much more valuable the zoning makes the land – look at the boundary areas to figure that one out – it’s not a huge premium and the schools effect is much bigger.
HURRY – get those bids in this morning.
This tactic makes me want to send in a Price is Right type bid….
“My bid is $1.00 Bob.”
Yes that is my highest and best as I don’t want to go over the actual retail price.
This place sold for $552,000 for a tear down. Teardowns are hot.
“This place sold for $552,000 for a tear down.”
Color me *not* shocked.
$552 for a teardown?
Wow. I wasn’t close.
wojo: “I want unders on anon’s $475.”
HD: “ill take the over on tfo’s 475.”
So HD’s the big winner.
And I’ll pay up at the next meet up.
Thanks for reminding me that JJJ owes me drinks!
anon, check out this property’s info at Redfin and CCRD.
Redfin, four months after JJJ said it had traded at $552k, flagged the price “as a possibly abnormal transaction.”
CCRD reports a May 2014 mortgage for only $350k, which, if used to buy a $552k house, means the buyer put down 37%! — not likely.
So, given the incongruous info from Redfin & CCRD, I think my “unders” bet might still be a winner, therefore I refuse to pay HD $1 until you/he (or somebody else) can make a case warrantably asserting that this house did, indeed, trade for more than $475.
I’ve got $700k+ teardowns a mile and a half NW of here. So $552k is no surprise.
And, that ‘abnormal transaction’ is a corrected deed–there were *3* corrected deeds filed on the date of the sale of the $1.485m house built on the teardown.
Also, note that the $552 price was for an REO sale–they probably got less than a normal market sale would have.
And, that $350k mortgage is one of 2 mortgages on the $1.485m house–the other has a face amount of $600k.
The finished house: https://www.redfin.com/IL/Chicago/1454-W-Wellington-Ave-60657/home/13366131
I think you owe HD that dollar.
“Thanks for reminding me that JJJ owes me drinks!”
I can’t even puzzle out my reasoning, why was I thinking it was going for under whatever? I don’t get it. Luckily, I already marked those drinks to market, so with what oil has done and the weather during the last week you owe me some drinks now.
wojo, looks like standard stuff, a foreclosure, clean-up of old errors and maybe a new one, estate planning and just a normal spec house transaction. The $552k price for the lot looks right. I think that the 5/14 mortgage is the assignment of the current balance of the new buyer’s mortgage after the property was put into the estate planning trust.
“And, that $350k mortgage is one of 2 mortgages on the $1.485m house–the other has a face amount of $600k.”
You’re probably right, I don’t follow all this stuff that well when the estate planning comes in.
“I’ve got $700k+ teardowns a mile and a half NW of here. So $552k is no surprise.”
In Bell, surely. Not that much above low 600s in Burley that I have seen, maybe I missed something.
Dang it. Thanks anon. I didn’t see there were two mortgages, one for 600 and the second for 400k. I only saw the one for 350, which lead me tothink I had a winner.
If the 600k loan was used to buy the house for 552, that’d put the LTV way way over 100. Why would one bank sell a house from its inventory for 552k when a second bank was willing to lend 600k against the same house?
Either the 552 seller was selling way too low, or the 600k lender was being way too bullish in their appraisal. Since it ultimately sold for nearly 1.5 m, it was clearly the 552 seller who was wrong.
So, the 400k mortgage funded the rehab, and was refi-ed & paid-down four months later? That’s an awfully short-lived mortgage.
In the end, I agree with you: this house traded way way over 475. It’s awesome — the house itself and the nearly million dollars in debt encumbering it.
wojo:
You’re not seeing the teardown that was on the lot when it traded at $552, and before they threw up the $1.5m house in under 9 months.
The teardown went for a slight discount, which let the developer make a little extra money (at least includgin cost of funds and the timing of the sale) selling at $1.485, as compared to paying a ‘market’ price for the lot and selling for $1.525.
there was no (recorded) mortgage on the place b/t the Mar-13 sale of the teardown and the Jan-14 sale of the new house.
“You’re not seeing the teardown that was on the lot when it traded at $552,…”
And now I wish I could see that teardown. I don’t imagine it was uninhabitable, given that Astoria Bank lent 500k against it in 2004.
“there was no (recorded) mortgage on the place b/t the Mar-13 sale of the teardown and the Jan-14 sale of the new house.”
So, that implies the developer, Thady Construction, didn’t borrow funds to acquire the lot or to pay for the new construction. If so, I’m impressed, since I assumed developers require lenient lending officeres, needing one loan to buy a property, and a second loan to build or rehab it.
So, after buying the lot for 552, and then tearing down the existing house (at what cost would guess?) and then building a new house {at what cost?} that sold for $1.485, what would you guess the developer’s all-in costs amounted to?