Echo Park Feeding Frenzy-32 Offers.
I just had a buyer go over the asking price on this cute craftsman fourplex near the Echo Park lake. It is a bargain- $550k for two market rent units and two vacant ones. It was remodeled in 2005 and bought for $1.1m in 2006. At $550k with 25% down PITI payments would be about $3500 but rents would be $5500 so it's a cash machine in a great location. It makes sense that we would see some buyer attention on it but the demand was enormous. There were 32 offers on it in one week!. This is an extreme example of the multiple offers phenomon that we have been seeing since late 2009. There are relatively few listings on the market so when the banks release an REO property for sale the law of supply and demand works in their favor. This is reminding me more and more of the run and gun days of 2005 when everyone had stated mortgage financing with zero down payment and every property was getting a dozen offers. It's most amazing to me because the mortgage lenders are so tight these days and yet there are hordes of people qualifying for loans. Perhaps it is a testament to the fundamental desirability of Real Estate in Los Angeles. To buy a property in this market, be ready to act quickly and be ready to overbid!