849 Sheldon Street flips for 70% increase

Bill’s coming soon fishing expedition must not have paid off because 849 Sheldon hit the market at $1.4 mil. The home is a 2100 sqft 3/3 on a 4556 sqft lot.

I’m guessing it’s a flip. I wrote about it in December 2016 when it hit the market for $899k (I’m kicking myself as I think about that). At the time the home was in default and can’t find much more info from that listing 13 months ago. Here’s a before picture from google maps

849sheldon

Regardless it’s completely upgraded with electrical, plumbing appliances and landscaping all for $666/sqft. Not horrible. Other than a one car garage and you are damn close to LAX. But it’s shiny and new and may hold it’s value reasonably well if and when real estate markets get soft.

If I do some back of the envelope math and assume the square footage didn’t change they probably dropped $250-$300k to get it to where it’s at. Plus a year’s carrying costs. I imagine they are in for about $1.2-1.3 mil. Plan accordingly.

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Rentals, rentals everywhere

Who is moving mid December-January that there are so many rentals hitting the market. I saw on ESPN some local was advertising a 2/2 for $3600 after someone backed out of the deal. Ooops, maybe you shouldn’t be trying to rape people with the price.

When you look at the rental listings you see the same skitzo pricing you see in the sale prices. People are crazy, trying to squeeze every last dime out of you and have a very poor sense of what their home is worth.

A 622sqft  2/2 for $2800 WTF? That’s a two car garage with a kitchen.
Ugly 1000 sqft homes for $4000-$4200. Someone needs an income of $145k to qualify to live in a shithole. Good luck.
Finally there are a couple of homes that are sized for people that don’t like to co-sleep with their teenagers.

$4600 for a 2265sqft 3/2.5
$4000 for an 1800sq 4/2
$2795 for a 1600sqft 3/1

Don’t buy, take advantage of Trumps crazy tax plan and rent!

 

The dirt on West Oak

Like I’ve mentioned. El Segundo is a small-ass town with every resident about two degrees of separation from everyone else in this town. You either love it or hate it. One of my readers emailed me some dirt on the Halton Pardee party with Concord and the former $3 mil dollar flip on West Oak. Turns out that both properties were purchased by the same flipper with hopes of taking the proceeds from 425 W. Oak and moving on to flip 521 Concord.

But, like I mentioned they are probably spending sleepless nights wondering how the hell to unload West Oak!

425 W. Oak was purchased for $1.075 in August 2016 while concord was purchased one year later in August 2017 for $1.275 mil (they got RIPPED OFF).

West Oak hit the market in September 2017 and I imagine now they are panicking and trying to cut their losses. 521 Concord was listed December 29 for a RIDICULOUS $1.45 mil right around the time Hilton Pardee took over from Gina Hoffman’s fantastical $3 mil price. West Oak now shows as pending ($2.47 mil was the latest asking and at $617/sft for a brand new house is a good deal).

They are fucked on Concord.  $1214/sqft for a tear down Spanish home on a 7000 sqft lot??? A house miraculously gains 13% in value by sitting untouched for four months!!!! I can’t help but laughing at how bad this is turning out.

Hey, maybe someone wants to unload some of that bitcoin that they were squirreling away for a rainy day? Ohh, that’s right….

Sorry for all the cussing. This one just gets me riled up because I think it sends a couple important messages:

  1. THIS IS NOT MANHATTAN BEACH. Nor will it ever be!
  2. Hilton Pardee can take their $90k in commission and head back down Lincoln to where they came from.
  3. If we are lucky it will also scare the bejesus out of other would-be flippers from thinking that El Segundo is where they should set up shop.

Welcome to El Segundo, please have some Kool Aid

El Segundo is a weird town. I’ve been in Los Angeles for 20 years and have lived all over LA and have to say there is no place that closely resembles El Segundo.

El Segundo is often referred to by the locals as Mayberry. The fictional, awe-shucks town in North Carolina that was the setting for the Andy Griffith show. Where everyone knows one another and it’s just a grand, safe and lovely place to live. El Segundo is a lot of that. A nice, safe, small community where, for the most part, neighbors really do know each other. People want to live and grow up there. But our little version of Mayberry has a couple of fucked up qualities as well as some REALLY, REALLY, REALLY bad issues:

LAX – It’s probably been there longer than El Segundo, but the level of airplane noise is ever-present. Occasionally you get the whiff of airplane exhaust and there’s also a pipeline that jet fuel directly under El Segundo to LAX.

Chevron. Although our particular Chevron refinery is a great community member with a great safety record how much do we really know? There’s oil and chemicals in the air, weird smells, oil and fuel being transported though and under the town. Like I mentioned, we have the jet fuel pipeline and we also have a pipeline that carries oil out to the little stretch of ocean we can call El Segundo Beach.

Scattergood Generating Station. We don’t hear a lot about Scattergood but a quick google search shares some info on it’s current upgrade and the move to change it from a steam station to a natural gas powered station. Great.

My favorite horrific issue is the Hyperion Waste Treatment plant. Outside of El Segundo, our sweet little town is often referred to as Smell Segundo because of our neighbor to the west. Le’s let LA Sanitation describe Hyperion:

The Hyperion Water Reclamation Plant is the City’s oldest and largest wastewater treatment facility.

Great, I love the words old and the largest being associated with the shit treatment plant located nextdoor. I bring this up because of a comical conversation on the El Segundo Parents Network.

For those of you that aren’t local and don’t know what the ESPN is; it’s a private facebook group comprised of members that live in or have business dealings in El Segundo. It’s a great resource for local info and referrals. It’s also a giant sewing circle full of gossip, innuendo and lessons on how NOT to act on social media.

There was a recent post was from a local (you have to be a local to be in the group) asking about smells on the west side of town that they encountered when looking at a home for sale. One of the first responses was from Alex Abad with a soft “I’m a local real estate agent with 30 years of local knowledge” sales pitch. Dick. Then there were responses that were on the complete opposite side of the spectrum:

A. I’ve lived in El Segundo forever and there is little to no smell near Hyperion anymore.
B. The smells in that are of town are horrible and you should never buy a house in that part of town.

Which is it? It’s can’t be both.  That’s where the kool-aid comes in. There’s a lot of justification and excuses people give for El Segundo’s many industrial and pollution issues. We are talking about spending one million + american dollars on a home. Does poo smell and airplane noise provide any discount when compared to surrounding areas? Nope. Any honest real estate agent should honestly point out the issues with pollution and resale because of these issues, but instead it’s the fantasy, kool-aid drinking mayberry sales pitch.

I would guess the home in question is 633 West Acacia. 

Enjoy:

I was looking at a home to buy in El Segundo on Acacia close to Dune and we smelled a strong sewage smell outside. We found out Hyperion is located at the end of the street. I am wondering how often people living in this area smell that sewage smell as the owners mentioned “only occasionally.” Is it worth it to buy a home in that area? Would be even be able to enjoy the backyard?

Comments posted without grammatical corrections

  • We live right near there. Sewage smell is only occasionally.
  • You ask about enjoying the backyard we have lived here 24 years and the planes still bother me. Especially outside you have to stop talking when they talked off.
  • My girlfriend use to live over that side of town. It would smell when it would rain and maybe once or twice month. The airport noise was definitely the reason why she moved .
  • My brother & sister in law live on that side of town & the planes are brutal. Especially if you like to be outside. We are on the other end of town and rarely hear the airplanes.
  • I am so used to it now it’s only the odd wild take off that attracts my attention.
  • I’ve lived next to the dunes for 25 years and read more complaints about Chevron and gas smells in other parts of town than I do Hyperion. I notice it less than once a month and I telecommute.
  • I have lived here my entire 50+ years and would not consider a home purchase in that quadrant of the citY, but this is my personal opinion.
  • Lived in that area almost 5 years. Can count on one hand the times I noticed any smell. Guess we get used to the airplane noise.
  • I’ve only been on the opposite side of town now for about nine months…, but having been a REALTOR for more that thirty years, the resale value will be impacted and if you can afford a house or conversion over in Smokey Hollow area, or anywhere more south…, it would be my suggestion you seriously consider that. Both the LAX and Hyperian are a double whammy. There’s a reason homes are more affordable there. [editors note: WTF? Affordable? Live in Smokey Hollow DIRECTLY NEXT DOOR TO CHEVRON?…Dickhead]
  • Hyperion smell, not so bad. You should have been here in the eighties and early 90s.
  • My sister lived on Dune Street years ago. She had to keep her doors closed most of the time due to thesmell.

What the hell is going on at 816 Sheldon?

Lynn O’Neil tried to tease the masses with a coming soon post about 816 Sheldon on the El Segundo Parents Network. Guess there were no takers so it hit the market at $1.735 mil. This house has a convoluted history and was on our radar when we were looking to buy in 2015.

816 Sheldon is 2700 sqft home on a 6700 sqft lot. Its a big giant remodeled box that was built in 2000. It’s priced at $643/sqft. I want to know why people do not want to live in this house. WTF is wrong with it? Listed in summer 2015 at $1.275 mil it changed hands in September 2015 for $1.045 mil (18% under original list). It was not in the same condition you see in the current photos. It was dumpy. But then eight months later the new owner lists it at $1.58 mil? WTF a 50% increase? But they actually get $1.5 mil in July 2016! Good job to whomever was involved in that.

So the third owner in three years must think this is a lucky house and that it warrants an additional 13% increase over the ass-ripping price they paid just 17 months ago?

Is this house haunted? Lucky?

Property History for 816 Sheldon St

Date Event & Source Price Appreciation
Jan 11, 2018
Listed (Active)
CRMLS #SB18008291
$1,735,000
Jul 22, 2016
Sold (Public Records)
Public Records
$1,535,000 8.8%/yr
Jul 22, 2016 Sold (MLS) (Closed Sale)

CRMLS #SB16107080
$1,535,000
Jul 14, 2016 Pending (Pending Sale)

CRMLS #SB16107080
Jun 17, 2016 Contingent (Active Under Contract)

CRMLS #SB16107080
Jun 14, 2016 Price Changed

CRMLS #SB16107080
$1,549,000
May 19, 2016 Listed (Active)

CRMLS #SB16107080
$1,579,000
Sep 18, 2015 Sold (MLS) (Closed Sale)

CRMLS #SB15123352
$1,045,000
Sep 11, 2015 Pending (Pending Sale)

CRMLS #SB15123352
Aug 15, 2015 Contingent (Active Under Contract)

CRMLS #SB15123352
Jul 31, 2015 Price Changed

CRMLS #SB15123352
$1,149,000
Jul 21, 2015 Price Changed

CRMLS #SB15123352
$1,199,000
Jul 21, 2015 Relisted (Active)

CRMLS #SB15123352
Jun 29, 2015 Contingent (Active Under Contract)

CRMLS #SB15123352
Jun 8, 2015 Listed (Active)

CRMLS #SB15123352
$1,275,000
Jul 13, 1999
Sold (Public Records)
Public Records
$366,000 4.2%/yr

FOMO is real!

If I hear another person that has no financial/economic basis of understanding talk about Bitcoin I’m going to slit my wrists.

FOMO = Fear Of Missing Out

 

Just like the end of the 90s with the DotCom stocks and the early/mid 2000s with real estate those of use that have missed out have a fear that we will completely miss the boat. Stocks, real estate, et all continue to rally so why not buy a house despite knowing that prices are crazy, buy bitcoin (insert cryto du jour), invest some money with your nephew that’s flipping homes, buy some Netflix or Tesla stock….

I feel it. I want to participate in the stock market melt up more than anything. It wasn’t until this year that I realized how important stock market gains were to my psyche and cashflow. Can’t really justify the trip to Hawaii this year? let’s just sell a handful of shares of Apple…

By the looks of the activity in El Segundo the Fear of Missing out is alive and well. Despite abhorrent quality, shit prices, bad locations homes still continue to move.

At or near $768/sqft 848 Pepper now shows as pending. 

I guess I was wrong about Michael Earley’s $10k reduction at 631 West Acacia. That tiny home in a horrific location also shows as pending.

At $512/sqft 905 Hillcrest also shows as pending. This is one of the few homes I thought was priced correctly and was surprised it took as long as it did. Guess the cabal of local agents were at work trying to keep an out of town agent from selling a home. I find it hard to believe that you get almost twice as much home as 848 Pepper for only $250k more.

Let go of the fear. There will be a time.

It’s not just El Segundo

Santa Fe home most robust in decade, but rising prices hurt residents seeking ownership

  • The housing affordability index — which compares the median household income of an area with the income needed to purchase a median-priced home — is on the decline, and the inventory of local homes on the market has dropped to its lowest level since at least 2005, according to the association’s report.
  • Addressing the lack of lower-cost single-family homes for purchase, as well as rental units, is one of his top concerns, Hill said. He added several proposed projects in 2017 met with opposition from neighbors.

“We have a real problem with NIMBY-ism,” he said.

Little ole Santa Fe, Los Angeles, Portland, El Segundo… same same.

Renting ain’t easy

The diatribe of “it isn’t fair” seems to have subsided when discussing rental prices in El Segundo. Let’s face it, this is the new normal. While I believe that historically there were a lot of homes to rent in El Segundo that were personally managed by a family that lived in town that valued a good tenant over getting the highest possible rent. Slowly those home owners have followed the herd to charging the what the market will bear. That’s a fair economic model but as we see the cost of charging the most you can get away with is lots of turnover, super low rental inventory and people freaking out when they have to move or get a 90 day notice to vacate.

Today’s grab-em-by-the-balls rental is at 1014 E Acacia 90245 for $4000 brought to you by REMS Property Management. The zillow rental listing calls it a 3/1.5 and redfin says it’s 1,089 sqft. So basically it’s small, in a shit location and like the majority of rental homes all over the soutbay – it’s just a tad over livable.  Looks like you pay for all utilities and by the looks of that awesome landscaping I guess they don’t pay for the gardener either.  Oh, and please BYO fridge. Because people that rent homes love buying their own appliances.

$4/sqft rental prices is as insane as $1000/sqft purchase prices.

Go rent the house at 741 Loma Vista. It’s almost twice the size and $100 cheaper. And they pay for the gardener.

updates for El Segundo Real Estate

631 W Acacia 90245 gets a haircut. If I’m not mistaken 631 W Acacia was one of a pair of side-by-side listings. 627 Acacia sold for $1.15 mil after two months on the market. 631 W Acacia is a 2/1, 1069 sqft house on a 7875 sqft lot. Despite the flowery copy this is being sold as a tear down on a big lot. The downfall…. location, location, location. Not only is Acacia the second closest street to LAX, being on the west side of town the airplane noise is horrendous. In order to really motivate those sitting on the fence and garner new interest Michael Earley of Douglas Elliman lowered the price an entire $10,000. That’s 0.9%! Nice work! I’m sure the would be flipper will start banging on the door. Maybe hit up Hilton Pardee; they seem to be the new suckers in town.

Speaking of Hilton Pardee I stopped by 521 Concord because I noticed the Hilton Pardee sign, I didn’t recognize the listing but sure enough I already wrote about it on 12/30. I bring it up again because 1. Penny Muck is the listing agent for both Concord and W. Oak and 2. I was reminded just how asinine the pricing is for Concord.

A little refresher. Some shmuck paid $1.275 mil in August 2017 for a POS “As-IS” house. Then they have the balls to list it for $1.45 mil, $175k more (also sold “As-Is”) four months later. Hmm, let’s do some math; commission on $1.45 mil is $75k. Maybe someone got struck in the face of reality when they over paid for a tear-down and realized it would take 12+ months and at least $1.5 mil to build a nice home.

But hey, Down 25k, nothing to lose. We can only go up from here.