If this were the selling price of the home, there would be thousands of offers made on the home. Unfortunately, what you are seeing is information from public records gathered by RealtyTrac and posted as if the property were for sale (RealtyTrac is confusing at best, downright wrong at worst).
This property is currently NOT listed for sale. The owners ARE in default on ONE of their loans. There are THREE loans outstanding on this property (one for $2.5 million, one for $500,001 and one for $150,000). The most recent listing in this neighborhood expired 11/2008 without selling. That home was listed for over $5.0 million.
Although we have seen home prices in this area come down a bit, there is nothing available for $500,000. Remember, if something looks too good to be true, it probably is. Hope that clarifies what is going on here. Many people are misled by RealtyTrac postings.
If you are truly interested in getting a good deal in this market, find an excellent real estate professional who will search not just current listings but also target market to foreclosures and/or recent purchases (2004-2007) in the areas where you are interested in buying. Good deals are out there as long as you stay realistic and persistent. Dare to Dream.
Real Estate Consultant
RE/MAX Palos Verdes Realty