Tuesday, January 1, 2008

Ashley Long

Ashley Long, Home Buyer / Knife Catcher
People have a lot to learn about this housing debacle. Just because prices have dropped 20-30% from the PEAK in some areas, does not mean they won't fall another 20-30%. Keep in mind the peaks quite often contain an inherent amount of fraud.

2008-01-01: Forecasters see end to Sonoma County housing woes
Sonoma County’s slumping real estate market should finally hit bottom in late 2008, ending a three-year slide that has already wiped out almost $120,000 in value from the typical home.

In Windsor, Ashley Long paid $470,000 earlier this month for a four-bedroom house that was worth $630,000 near the market’s peak. The sellers, which originally listed the home at $525,000, cut the price twice to attract a buyer.“

Six months ago this kind of house wasn’t out there for her,” said Long’s agent, Tim Souza, with Century 21 Alliance in Windsor. A first-time home buyer, Long looked at more than 50 houses over three months, trying to find the nicest house for the lowest price. She didn’t hesitate, however, to make an offer on the Windsor house after Souza spotted the latest price reduction, yet Long still went under the seller’s amount. “I got a pretty good deal. I know this is a low market and the house is worth more than that,” Long said.

To lower her monthly mortgage payment, Long made a 10 percent down payment to lock in a low interest rate on a 30-year loan.“It’s the only time I’m going to be able to afford to buy in Sonoma County,” she said. “I can’t imagine it going down a lot lower, and eventually it has to come back up. I don’t want to gamble.”
Lets see if she got a "pretty good deal".

Here is the house:
7108 Hastings Pl
Windsor, CA
4 beds, 3.0 baths, 2,032 sq ft, APN: 163-120-052-000
Sale History:
03/13/1998: $222,500

To arrive at a current price of $470,000, the house appreciated ~7.8% per year (using 10 years). Is this a good deal?
At 5% Appreciation: $362,000
At 3% Appreciation: $300,000

Did she get a good deal? I don't think so, but perhaps her gamble will pay off.

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