Everyone wants to be a flipper. Just like in the early to mid 2000s it seems like a can’t-lose situation. Buy a house for $1.1 -Drop a $75K and six month’s later you have a $1.4 mil house. Not a bad way to make a couple hundred grand in a short time if you have access to the capital.
As we’ve seen over the past year, developers and would-be flippers are hitting the streets of El Segundo. Gambling on a payoff with a million plus on the line is not for the faint of heart. There’s also the horrendous time issue to consider.
I first wrote about 3030 E Mariposa 90245 back in October. This tiny home changed hands in May 2015 for $750K and then again October 2016 for $845K (Kudos to the owner who pulled that off). Up until a few weeks ago the home has sat vacant. There was plastic on the windows and no evidence that the home was occupied or being worked on. A few weeks ago we saw that change when the front of the house was blown out. So there’s a dose of reality for those would be buyers that think after watching a few episodes of Fixer Upper that they can buy a crappy little house and make it right. It’s taken about eight months assuming the new owner immediately started with an architect and plans with the city. EIGHT MONTHS of dealing with BS city politics, spending money on architects, trying to find the right contractor….all the while paying your mortgage and taxes of ~$4000k/month. That’s on a note of $676K and unfortunately we are all sold out of $845,000 houses in El Segundo. Don’t let the low sales price fool you, Mariposa is basically half of a house on half of a lot. You get what you pay for.
Over the past week we’ve also seen Bill Ruane start another fishing expedition with his listing at 650 W Maple. The sign says New Construction Coming Soon. I wonder if this is Bill playing developer like Alex? So start the clock and let’s see how long this listing takes to morph into a home worth buying? Taking bets…18 months? 24 months? Or the wheels fall off and it takes more than two years to come to market?