April 8, 2008

A Not-Surprising Price Reduction

A month ago, I wrote about a listing — 738 South Highland Avenue — that appeared to be an ill-timed attempt at a flip.  The 1,864-square-foot house on a 7,500-foot lot, pictured above, had been purchased in 2006 for $990,000, remodeled and put back on the market for $1,595,000.

There were a few problems. 

First, the listing noted that the home is in prestigious Hancock Park, but it isn’t:  Hancock Park’s southernmost boundary is Wilshire Boulevard, and this house is south of Wilshire.  (The listing agent has yet to correct this “mistake.”) I believe the neighborhood is called Brookside. Or “Hancock Park adjacent, in Realtor-speak.

And speaking of location, even if you overlook the fact that busy Wilshire is only a half-block away, it’s impossible to ignore that Highland is a single-lane through street, connecting Olympic and Wilshire.  When I went there to take my photo, I waited across the street for a full minute while dozens of commuters whizzed by. 

Things sure have changed from our seller’s market, where the object was to acquire a property — ANY property — just so you wouldn’t be left out in the cold during the huge run-up in prices.  Now, in a buyer’s market, homes with what the pros call “incurable defects” — such as location issues — will be a lot harder to sell. 

Anyway, this house has already been reduced to $1,350,000. 

The original post noted several recent nearby comps — for $780,000, $995,000 and $1,017,000.  Since then, there has been one more sale:  908 South Hudson Avenue, a 3+1 with 1,546 square feet for $1,200,000.  That could be a hopeful sign for our seller, but it should be noted that this location is considerably quieter and less trafficky.