Striking Example of (Multiple) Short Sell

arrows2.jpgWhen the image of this home at 1707 Fairview in Berkeley popped up, I was intrigued by both the cute little cottage with white picket fence and the price. From the outside, this 3/1, 1,123 sf home looks appealing, painted a nice yellow with white trim, although the yard looks like it could use a little help. There is even an attic that has a partial remodel, that would give you the potential for increased footage, which is a bonus. The listing came on the market just 3 days ago, and is priced at a seemingly low $482,900. The neighborhood isn’t Claremont or anywhere in the hills, but in South Berkeley, about 1.5 blocks from the Ashby BART Station, which doesn’t seem like the worst neighborhood to live in. Digging around some more, I found that the home has gone through multiple owners in the last year and a half. It originally sold in March of 2006 for $567,000. Someone mistakenly paid $730,000 for it just 6 months later only to have to turn around and sell it in June of this year for $570,371 (a loss of $160,000). Now it is on the market for $90,000 less than it sold for two months ago. (FYI – the Zillow estimate for this home is $250,000 more than listing, and neighborhing properties are all estimated over $600,000.) You gotta feel sorry for people who suffer losses like this, and it is happening all over the Bay Area, the state, and the country.

The lesson being hammered home by sales like this is to be sure you can afford what you buy, that you are careful about your mortage lender and terms, and that you always have a reserve in the bank, so if you lose your job or have a large unexpected expense that you do not have to default on your loan. Meanwhile, homes like this could be a bargain to the right buyer.

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