Open House: Pasadena

By popular demand, we checked out Open Houses today in Pasadena -- mainly northwest Pasadena. Agent Cherryl Weaver on the Pasadena market: "The Victorians and Craftsmans -- the typical million-dollar Pasadena houses -- seem to be moving OK. The lower end of the market is absolutely flat. The massive amount of condos in Old Town seem to be sitting on the market forever. The first-time homebuyer with stated income? They can kiss their dream of home ownership goodbye for a while. You need proof of income and at least five percent down."

1105 N. Garfield Ave., Garfield Heights (pictured). Beautifully restored from complete neglect (no plumbing, no electricity), 100-year-old "foursquare" farmhouse. Three bedrooms, 2 1/2 baths, 2300 SF on an 8194 SF lot, listed at $1.25 million, 44 days on market. Owner Bridgette Peters on the neighborhood: "It's a great neighborhood. It's had its hard times, but the people who have stuck it out are really happy with the revitalization." She and her husband plan to buy another fixer-upper in the area.

111 S. Orange Grove Blvd, #206: Two bedroom, 2-bath, 1,750 SF condo, lots of mirrors and marble, $739,990. Current owner knows many stars: framed, autographed headshots of Clint, Jack, etc. Agent Anna Wong on the market: ""It's not as busy. Normally we'd have multiple offers the first week of listing. People are in a holding pattern."

One S. Orange Grove Blvd., #5: Two bedroom, 2 1/2 bath, 2104 SF split-level townhouse with parquet floors, formal entry. $969,000. Agent Chuck Livingstone: "Pasadena is really holding its own. I think it's leveled off somewhat. But we don't have the sub-prime loans or the 100% financing, so foreclosures are minimal."

1106 N. Garfield Ave.  Four bedroom, 3 bath, 2780 SF on smallish (4400 SF) lot, partially renovated, built in 1989, high ceilings, church-like facade faces street. Vacant. Listed for $849,000 three weeks ago, reduced to $799,000.

1034 N. Garfield Ave. Three bedroom, 1 bath, 968 SF plus 300-SF bonus sun room on secluded flag-shaped lot. $547,000. Agent Cherryl Weaver on the house: "You can live in a million-dollar neighborhood for half the price."

1132 N. Summit Avenue, NW Pasadena: (No Open House; we grabbed a flier) Two bedroom, 1-bath, shady corner lot. $530,000. The street is kind of scruffy -- a shopping cart on the sidewalk, some lawns not tended.

864 N. Summit Avenue, NW Pasadena: (No Open House; we grabbed a flier) Two 3-bedroom houses on one 8,000 SF lot. Listed at $900,000, reduced to $850,000. Scruffy street -- see above.

Comments

[Bill Bond]

The top end of the real estate market is doing fine because the Option ARMs have not reset yet. With an Option ARM, you can get a mortgage for a $1million house for like $3,000 a month.

Option ARM start resetting in January 2009 in a MAJOR WAY, just google "credit suisse mortgage reset" to view the schedule.

That $3,000 a month Option ARM on a $1 milion house resets to almost $9,000 a month, or if you like, about $120k per year when you add in property taxes.

When those resets happen, that' s when the real panic will set it. A person paying the minimum on a $1 million Option Arm will watch their total mortgage jump to over $1.2 million, just as their house falls in value. In fact the top 75th percentile in housing in LA has already dropped in value from $999k in August 2005 to $793k this week. Don't believe me? Check out HOUSING TRACKER if you want to see the data for yourself:

http://www.housingtracker.net/old_housingtracker/location/California/LosAngeles/

So lets say housing drops another 15% at the top end, which it can easily do over the next 2 years (probably more like 25%). That puts that $999k house with a $1.2 million loan against it down to a value of $675k. Who wouldn't default on a house where you are upside down $525k and your mortgage is $10k a month? That's a no brainer.

Then the bank takes possession. After pricing it to sell and paying a broker, the bank or MBS holders take a nearly $600k loss ON ONE PROPERTY.

People are fretting about subprime where the losses are $40k to $60k a house. Wait til the top end pops and the losses start looking like 10x that. That's when the panic will really set in and those MBS will start cratering to 10 cents on the dollar....if that.

We've got closer to 3 years before this works its way through the whole financial system. By the time it's done, the fed will run out of ink just trying to keep the banks from going out of business.

BB

[willie]

TheyGarfield Heights house is the one that Zillo, who is pretty generous about the value estimate, say it is worth about a million, certainly not $1.25 mil. Delusions!

[lefty]

a little off-topic but why have a pic link (the house) when the pop-up pic is the same size? waste of time, no?

[Pasadena Real Estate]

The home on 1132 N. Summit Avenue, NW Pasadena is very cute inside. The only thing it's missing is a backyard which is a huge thing to be missing, especially at a $530,000 asking price.

Being that this home has many neighboring short sales and bank owned REO's, the price needs to be slashed in order to sell.

See Pasadena Foreclosures and Pasadena Short Sales at : http://www.soldbyramiro.com/foreclosure.asp

The Pasadena Real Estate market in the Northwest sector has been definately affected by the rise in foreclosures.

[qwerty007]

Pasadena is a very big area, with a commensurate price range. I live in the Hastings Ranch area, where 'for sale' signs are conspicuous by their absence. The few that are, have been on the market for as long as a year, so it's classic holding out, denial, non-subprime country, that is waiting to be infected by the subprime neighboring contagion, where foreclosures are as high as anywhere. Eventually, someone will have to sell, which will open the flood gates for declines, and spill over into adjacent postcodes. It's just a matter of time. Inventory levels are three times the norm and buyers won't buy in a declining market, notwithstanding low rates, and choice. The very high end is unlikely to be affected, as the very rich generally don't need to worry about timing.

[Hughes]

Ya, I'm still waiting for those ARM's to reset and the next wave of foreclosures before I get too excited about buying right now. Anything decent is getting bid up beyond what it's worth still. It may be a good time for the bottom of the barrel stuff, but I think the good deals in Pasadena will be next year.