$549,000 starter home in OB

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Submitted by gzz on October 16, 2015 - 12:52pm

http://www.sdlookup.com/MLS-150056000-48...

This is on a pretty, quiet block west of sunset cliffs. I'd buy if I didn't already have my hand full. Looks like it has two parking spaces off the alley.

Submitted by jeff303 on October 16, 2015 - 1:41pm.

http://i.imgur.com/MerGpk0.png

What size bed fits in a 10 foot, 1-dimensional space?

Submitted by moneymaker on October 16, 2015 - 4:30pm.

Wow, me thinks BuBBle! If they get anything over 500k! Then again this one http://www.sdlookup.com/MLS-150047697-51... is even more pricey when you look at ppsf

Submitted by Hatfield on October 16, 2015 - 6:08pm.

"Great opportunity for investor!" Yeah! Might be able to pull $2k/month if it has a garage. You'd only need to come in with about 70% down to get to zero cash flow. Where do I sign up?

Submitted by gzz on October 18, 2015 - 9:48pm.

"What size bed fits in a 10 foot, 1-dimensional space?"

A flat bed

Submitted by gzz on October 18, 2015 - 9:57pm.

"Yeah! Might be able to pull $2k/month if it has a garage. You'd only need to come in with about 70% down to get to zero cash flow. Where do I sign up?"

It does have a garage. $2200 is more like it.

Demanding immediate positive cash flow would have caused you to miss out on half of the current upswing in San Diego, and more like 80% in the Bay Area.

If you look at my other posts, you can see I am bullish on ocean beach. It is more convenient to both the 5 and 8 and quieter with very few large apartment complexes.

I think it will go up faster than the SD market in general. This house would be $750,000 an equal distance from the beach in PB and maybe $1 million in La Jolla.

I think the premium PB has over OB will narrow. The school district here is already better for every grade level, except the very north tip of PB zoned for La Jolla schools.

Not to be negative about PB though, I think it is great too, just not as much appreciation potential.

Submitted by gzz on October 18, 2015 - 10:02pm.

"Then again this one is even more pricey when you look at ppsf"

That house is a 1 minute walk from the dog beach entrance and has two off-street spaces.

Not quite beach front, but close enough to hear the waves on a quiet night or early morning.

It can also be upgraded to about 1100sq feet.

It has been used as a vacation rental for many years so its price is a function of the profits on doing so.

If you want actual land, not a share of a condo complex, that is about as cheap as you can get close to the beach.

Submitted by Hatfield on October 19, 2015 - 11:04am.

gzz wrote:
"Yeah! Might be able to pull $2k/month if it has a garage. You'd only need to come in with about 70% down to get to zero cash flow. Where do I sign up?"

It does have a garage. $2200 is more like it.

Demanding immediate positive cash flow would have caused you to miss out on half of the current upswing in San Diego, and more like 80% in the Bay Area.

If you look at my other posts, you can see I am bullish on ocean beach.

I guess that's the difference between a momentum investor and a value investor. ;) I too am bullish on OB long term but I don't think it this property is a good value. I've lived in OB for 25 years and own two rental units here (one at the north end, one at the south). I think the market is overpriced right now. $549k is an awful lot for not-a-great-house on a single lot in a not-a-great-location within OB. Who knows, I could be wrong. I keep waiting for a correction and it never comes.

$2200 is pretty steep for a 1BR, even with a garage. I'm not saying it isn't possible, I just wouldn't base any calculations on it. Does not pencil out on my spreadsheet. If it does on yours, more power to you. I won't talk you out of it.

Submitted by gzz on October 19, 2015 - 6:38pm.

It is a 2 bedroom.

Plenty of people want a place a short walk from dog beach with an enclosed private yard for their dog and are willing to pay for it. I am having second thoughts on saying 550,000 is a good price given that the listing is now a week old and still has no interior photos.

OB has momentum and at least relative value.

I am a landlord and resident here too. Must be nice to have properties purchased 20+ years ago at 1/4 or less of market price, and still taxed that way too. My residence purchased as a short sale in 2011 is at least 40% below market price, so I have that!

Submitted by ucodegen on October 20, 2015 - 12:04am.

gzz wrote:
"What size bed fits in a 10 foot, 1-dimensional space?"

A flat bed


It fits along that line over there... It is completely without sides, but with two ends.

Submitted by Hatfield on October 20, 2015 - 3:11pm.

I stand corrected. Somehow I had assumed it was a 1BR, probably based on the 635 square footage. Have you been by the property yet? I just went by, and I'm still struggling to find anything that makes this property worth anything close to what they're asking. I'm curious what you see in it.

Yes, it's west of Sunset Cliffs... BUT:

As you know, the standard OB lot is 25 feet wide and sidewalk to alley. But Long Branch is a narrow street and the lots are not as deep, and it looks like it may not even be the full 25 feet wide. Even by OB standards this is a small lot. It has no view potential, and really not that great a location within OB. Parking is tight and the only off-street parking is a really beat single car garage. Both the garage and the house have flat roofs and neither has been well maintained. It's a basic stucco saltblock. Very cheap construction. It will require a lot of rehab to draw prime rent income, and after all that you're still stuck with a bad floorplan.

So we're talking $549 for a scraper on a tiny lot. And it wouldn't even make that great of a scraper. New construction probably wouldn't be able to keep the existing setbacks so you'd have to do a save-this-wall "remodel."

Submitted by ltsdd on October 20, 2015 - 8:34pm.

Agree that this property is not in a great location. It's actually is very close to SD's version of "skid row". Folks living in OB would know what I am talking about.

Submitted by Hatfield on October 20, 2015 - 9:08pm.

Please. We OBecians lovingly call it the warzone. :) The worst part OB historically has been the few blocks around Abbot and Voltaire, or sometimes the seawall under the pier. Even still that's a pretty far cry from, say 16th and J in the east East Village, which is pretty gnarly.

Actually when I first moved to OB 25 years ago I rented a place in the warzone - Saratoga between Abbot and Bacon. I loved it. I miss being that close to downtown. For this Long Branch property, you are just about as far as you can be from shopping / bars / etc while still being in the warzone. And it's one of the worst streets for parking. I see no reason to pay any kind of premium for this particular property.

Submitted by gzz on October 21, 2015 - 7:42pm.

I think the narrow streets like Long Branch with few/no apartments because of the small lot sizes have the maximum small town charm going for them. I can't think of another place where so many fat domestic cats are lounging next to the sidewalk and walk up to people. In "bad" areas a cat would have a few bad experiences and no longer walk up to strangers.

As for price, there seems to be an usually large number of old 2-bedroom cottages on the market right now. That might hold the price down.

Here's a flip of a house on a smaller lot/louder street nearby:

http://www.zillow.com/homedetails/2076-C...

This one is the same size on a bigger lot:

http://www.zillow.com/homedetails/2124-F...

Here's one that is overpriced given it is on the wrong side of Nimitz, but a nice partial renovation:

http://www.sdlookup.com/MLS-150045317-26...

Submitted by Hatfield on October 21, 2015 - 7:57pm.

Interesting. Thanks for the comps.

Given that they're all in the same price range, the ones on Cable and Froude both look better than the one on Long Branch, even if the one on cable is on a corner 1/2 lot.

I'll make a friendly beer bet that the one on long branch goes for no more than 450-475.

Submitted by gzz on October 22, 2015 - 6:08am.

I'd buy it for $450,000 and I am not even in the market.

I think most likely sale price after seeing the pictures is $520,000.

Another interesting OB property you may have seen is the building with a pet bird store next to Roberto's. I checked it out, for the size, location, and favorable commercial zoning, the asking $750,000 was pretty reasonable. I have long wanted a commercial building with offices for my business so I can stop renting.

Then I realized the problem: it is next to Robertos. There are drunks and stoners there all day every day and all night, and bums hang out on the tables at night. Even a 1/4 block down Voltaire might be OK, but not right next door.

Same problem for the little three building compound owned by an artist next to Jack in the Box that was on the market for about $850k last year but did not sell. That is an even bigger hangout for bums and drunks.

Last time I was in Jack in the Box there was a woman sleeping on Jack in the Box lawn next to a shopping cart with her bare ass completely 100% exposed to the air. I called the non-emergency police line, who then transferred me to the emergency medical line that sent an ambulance.

I can live with this a block away, but not next door.

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