Home Buying in 92657>Question Details

Mr. Blue, Home Buyer in Laguna Beach, CA

What was the buyer's agent doing and thinking? - huge loss for recent buyer in Crystal Cove.....

Asked by Mr. Blue, Laguna Beach, CA Tue Oct 6, 2009

How does an agent represent a buyer on a crystal cove house purchase, only to have a similar house down the street sell for $1.8 million less within a few months? Anyone know what happened with the sale at 18 Rockshore?
More info at http://www.bluemove.blogspot.com

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Mr. Blue, you seem to be assuming and speculating about things you don't have all the information for. You ask in your blog, "The value of this home was questionable, I thought. If it is that obvious, I wonder what kind of advice the buyer's agent gave to the buyer who was forking over $4.4 million." How obvious was it that the price was too high? Looking at the photo of the area, it resembles many oceanfront and soundfront areas where I am. It is not unusual to have a spread that large in prices. These are not cookiecutter subdivision type vinyl sided homes where the only difference may be the granite selected for the kitchen. How do you know the 2.6 million dollar house was comparable to the 4.4 million dollar house? A willing buyer bought a home. The buyer may have been intelligent enough to order their own appraisal if it was a cash purchase.

How do you know the buyer had their own agent? How do you know the buyer did not use a seller's agent or a broker's agent to buy this house?

Your blog does nothing more than bash real estate agents. Your question here is unanswerable.
3 votes Thank Flag Link Wed Oct 7, 2009
I live in Crystal Cove, and I'm Not an agent. But this happened before about 3 years ago . two exact floor models on the same street were sold with $1.2million dollers price difference. But the more expensive one had over $1million upgrade, and had white water view, and the other one was standard and Roof top View. The buyers didn't want to do the work themselves, and wanted to pay more and just move in. Also, this is their vacation home. It all depends on the buyers situations. Every situation is different. You can't just look at the comps. I'm sure the house that was sold for $4.4 million dollers more had alot more to offer than the other one.
1 vote Thank Flag Link Tue Feb 9, 2010
Your question is a few months old now, but you seem to be stirring things up around here. 18 Rockshore sold in June of 09 for $$4,420,000. List price is was $4,695,000. It was previously listed in November of 08 for $4,998,888.

There are various sections to it, the first level are condos and only a few floor plans, futher up you go there are semicustom and custom built homes. And empty lots incase you don't find what you want, you can build your own. Prices will vary between them, condo vs SFR. Square footage, Lot size, pools/spa, views, year built, plan or custom, and more.

Buyers agents must do their comps, review, adjust accordingly for lot and home size, adj for amenities, view, for starters - more depending on the property itself. The SFR in Crystal Cove can very from about 4000 to over 13,000 square feet.

Per MLS -as of today, there are 32 homes for sale in Crystal Cove. Only 1 is in Foreclosure process, and 2 are Short Sales. I search the MLS for REO/Foreclosure process SALES since 1/1/2010 - Non. Of the 32 listings - 5 are condos, listed from $2,195,000 to $2,750,000, and 28 Single Family Residents listed from $2,795,000 to $19,990,000. The two most expensive SFR were built in 2010 and are an excess of 13,500 sq feet - and that is the house, not the lot size. The smallest Single Family Residence is just under 3200 sq feet. The smaller condo listed about 2850 square feet - the largest condo listed is less than 3900 sq feet.
0 votes Thank Flag Link Wed Jun 30, 2010
Without looking, I wouldn' t be sure that there were any differences at all between the homes. If you go street by street, most homes in Crystal Cove are darn near identical until the upper areas of the hill........
0 votes Thank Flag Link Sun Jun 6, 2010
Homes is Crystal Cove vary in price from about $2 million to about $5million in the primary areas. Different development companies built out differing sections of the neighborhood. As you move up, allowing for bigger homes with better ocean views, those homes are in the 6.5M-9M range. If you go into the second gate with the "custom" homes, those homes cost around $10M-$20M. The values of the homes vary greatly based on size of home, size of lot, construnction quality and views. If you have been going into open houses in there for the past two years, none of what I have said should be new to you. On the other hand, if a similar home by the SAME builder/development section, has a huge variance in price...the view variantion will have some effect, otherwise, it could very well be the motivation/pricing of the homes drove the variance.
0 votes Thank Flag Link Wed Dec 23, 2009
Did you purchase this home, Mr. Blue?
0 votes Thank Flag Link Thu Oct 22, 2009
Mr. Blue

That's why real estate attorneys drew up the Market Conditions Advisory to protect Realtors® from getting sued by remorsed buyers.

If it was an investment property, ok that would be a bad deal.
But if it is a primary residence, cool. They can live there until the market comes back up and sell.

The buyer's agent did no wrong. Just did their duty.

Best Regards,

Jes Sierra, B.Sc.
0 votes Thank Flag Link Thu Oct 22, 2009
Wow did I unleash a wave of denial from out of area real estate agents who are doing a lot of guessing. Wrong guessing.

Pretty telling that not one agent from the local area responded.

I think I can address every question raised by the responders, who obviously know nothing about the local market here. If you knew anything, you would know that simlar ASKING prices on homes within 2 blocks have already dropped well into the $3,000,000's. Uhhhh, last time I checked, the market value for a home was less than asking price. These are all cookie cutter homes so it is a valid comparison.

First, as to the lack of detail, did any of you click on the web link? The detail is all there in my blog. Always has been. Web links are these things that most people understand.

The houses are all identical cookie cutter Tuscan homes. I know. I live here. I've been going to open houses in this neighborhood for 2 years.

Finally, appraisals are always pretty squishy and have a lot of room for error. Market data on the other hand doesn't lie. So if the buyer's agent didn't tell the buyer about the skyrocketing inventory, foreclosures in the neighborhood and the trend of vastly decreasing closings, the buyer was uniformed. Can't hide behind the appraisal.....
0 votes Thank Flag Link Wed Oct 21, 2009
Mr. Blue,
I have a couple of suggestions that might help you.
You could ask the listing agent...if you google the address you'll find them, just like I did.

Also, when a home sells, the buyers usually have some time of financing and the lender requires an appraisal. LIkewise, in a cash offer, an appraisal is often performed. So odds are that the property sold for market value.

I will also share with you that the listing agent states in the listing that if anyone has questions, to contact her.

So far as that "other " property that sold for 1.8 less...you did not mention WHICH property that was. In most markets it is very rare for a property to sell "under market" unless it is an arm's length transaction.
0 votes Thank Flag Link Wed Oct 7, 2009
Keith Sorem, Real Estate Pro in Glendale, CA
First, as JR correctly notes, we don't know that the two houses were that similar. We have your word for it. Did you run the comps? Or have appraisals done on the two? No, I didn't think so.

Second, agents don't set prices. The sellers and buyers agree on a price. If the buyer was willing to pay that, what's that to you? I see on your blog that you're interested in price declines. Fair enough. But that's a different issue. As you note, these sales occurred at roughly the same time, so it doesn't even play into your theme of a price decline. You're suggesting either improper behavior by an agent or ignorance on the part of the buyer. And I don't see much evidence for either.

Third, you're assuming the higher-priced home was overpriced. It's equally likely that the lower-priced home was underpriced. That happens. Perhaps the seller of the lower-priced home was more motivated to sell.

If you have something more to offer, then please present it.
0 votes Thank Flag Link Wed Oct 7, 2009
Don Tepper, Real Estate Pro in Burke, VA
Agents are subject to their brokers. Brokers get paid on transactions. In your case, the buyer was high and the agent was just doing their job. Can't give specifics on the address...in public forums.
0 votes Thank Flag Link Wed Oct 7, 2009
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