From county to county the party is heating up. Spring is in the air and overpriced homes are coming online like AOL. Each day, the MLS is flooded with delusional sellers thinking we are in 2005 and the market somehow will reflect yesteryear prices. In our 16 installment of Real Homes of Genius we will cover Van Nuys. We’ve covered such glorious places like Compton, Bell, Santa Ana, and Stanton. The jewels of Southern California and all showing sub-1,000 square feet homes for $400,000 to $500,000. Today we show that pie in the sky radius is rather large in Southern California. Today’s specimen is a 814 square foot 2 bedroom 1 bath mansion in East Van Nuys. This home is an excellent starter home with all the amenities you would ever want in a nest; a white picket fence, garage, and tree in the front yard. Okay the fence is actually security steel and the tree is bald but you get my point.
Average household income for this area is $44,712 and median net worth is $29,675. So yes, $535,000 is affordable for anyone looking to purchase here. If you are from out of state you are probably scratching your head and wondering “what is wrong with Denmark?” but you must understand that California has the sun and you don’t. I think the California Association of Realtors is trying to patent the sun for our soul usage. Hence you have homes for $200,000 and we have them for $500,000+. Makes sense? Good. It is always enlightening to see what this home sold for in the past:
So these folks initially had the place listed at $574,000+ but realized they might be a bit too greedy trying to sell for over $194,000 in two years. Now they have dropped the price by $39,000 thinking they’ll lure someone into this magnificent place. I’m sure someone will do a case study on how folks can ask for ridiculous prices but have a hard time lowering their price. They call this the "sticky" nature of housing but I like to call it the delusional Napoleonic vision of grandeur you have on your home; why mince words when we can say sticky right? I discussed this in my previous post regarding the Duesenberry effect and how people rarely adjust their standard of living on the way down. Either way, these folks no longer have the lambs that were being suckered in by no-doc loans and claiming they make $95,000 working graveyard at Wal-Mart. Little by little underwriting is getting more stringent as the credit sewer system in Wall Street is getting clogged up and we need a little reality Drano to get this thing moving again.
Today we Salute you Van Nuys with our Real Homes of Genius Award.