The rowhouse located at 1229 16th St NE is being offered at 350K. It has "Newly renovated four bedroom two bath semi-detached brick row house featuring CAC and heat, new carpet, new kitchen and bath, ceiling fans, off-street parking, and more! One year home warranty." The rowhouse is located in Trinidad.
Trinidad is a high crime area. There has been a very very minimal amount of gentrification.
The house was bought for $350,000 on 8/26/2005 which was just over 3 months ago. It was bought presumably by a speculator who is trying to flip it. Although it looks like the speculator put some work into it ( unless the previous owner put money into) he is still try to sell it for the same price he paid for it 3 months ago.
The current owner most probably bought it thinking that the housing boom would continue for awhile. Now, realizing the boom is over he is now trying to bail without too much of a loss.
Will it sell at this price? Nope.
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that nincompoop has ruined himself...just desserts
ReplyDeleteMaybe he isn't a flipper. I mean, he probably is, but I also know a lot of marginal neighborhoods in the DC area are being hyped as "the next Georgetown" or "the next Bethesda" or (if it's particularly and obviously bad) "the next Adams Morgan."
ReplyDeleteSo some of these guys, rather than being flippers, may just be suckers.
Another interesting thing about this anecdote is that it shows someone trying to get out at just his buying price. If he renovated it, he is still losing money on this deal.
If he is a flipper, he got burned and probably won't try again.
He can't be making much on it. Even if he got some cash back on the deal, he did some renovations, and you have all those transaction and carrying costs.
ReplyDeleteLet's say he walks away with $20,000 profit (before taxes) after 4 months. That's about $60,000 a year. There are less risky ways to make $60,000 a year.
Yeah, he could have a lot more houses. What I think is more likely is that he loses money on this deal and walks away embittered.