Monday, October 24, 2016

Eastside Property: How much would you pay to live in Echo Park? How about $922,000?

That’s what a nearly century-old, renovated and expanded Echo Park bungalow sold for this month less than 30 days after it was put for sale.  Despite a steep $849,000 asking price, Rudy Dvorak, who purchased the hillside house a year ago for $300,000 before flipping it,  said he received about 10 offers for the nearly 1,600-square-foot house, with the winning buyers, an East Coast couple, paying about 8.5% more than the asking price. In the past three years, only one other single-family Echo Park home  sold for more than $900,000, according to Redfin. “It was amazing to me,” said Dvoark of the interest in the Lemoyne Street house.  “Several of the people who made offers had missed out on other properties.”

Now, Dvorak, who has been buying, renovating and selling homes for several years now, is in the same boat as many other home buyers in a market where record-low interest rates have helped revive real estate sales and prices.  He recently got beat trying to buy three other properties  in the Echo Park and Silver Lake area.

“We are willing to pay cash. We are willing to go fast. We are willing to take on problems,” said Dvorak. But “it’s really hard to find something, even for us.  If it was rolling down the hill,  I would take it in a second.”

Related Link:

  • Talking flipping with ReInhabit, the guys who just sold an Echo Park house for $922k.  Curbed L.A.

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  1. How many square feet is this? How many bedrooms? How many bathrooms? After the add-ons.

  2. nice decorative fence, bro

  3. Umm, its still Echo Park….Hellooooo!

  4. Music to my heavily-invested-in-echo-park-ears!

  5. I can’t believe idiots are paying this much for flipped houses… AGAIN!!! It really seems like nobody learned the lessons from the 2008 crash. Its the same formula as before: buy a house, put some work into it (albeit he did more than most do) and make over $600,000 profit!?! This is crazy and so sad.

    Rich people with large amounts of cash are taking advantage of the government designed system that was supposed to help regular people own/stay in their homes. Now its nearly impossible for ordinary folks to get anything. Thanks rich people! You win again…

  6. that’s an incredible waste of money. This is what’s happening to LA. Stop pushing out the middle class by jumping the mortgages on properties that aren’t worth the money. I live in HLP and they’re doing that here. It’s going to get to a point where I won’t even be able to afford a house in Highland Park when I’m ready. I don’t want to live in the suburbs.

  7. Blitz and Bought

    I wish to extend thanks to the house flippers .. Thank you for outpricing regular people out of the market.. Jerks!

    • Being angry at flippers has never made any sense to me as house flippers are catering to the marketplace. They take decrepit properties and make them nice, improving the neighborhood one house at a time. They take a financial risk with each purchase, spend a hell of a lot of time and money getting the places livable and yes, they should make a profit when they sell just as other homeowners do in a strong market. How is this a bad thing?

      • Very well put EP4ME. While I understand the frustration, getting mad at flippers would be like getting mad people who had the foresight to buy when the market was extremely depressed just a couple years ago.

        One should look inward to find the true culprit…

    • FixerUpperNotter

      As someone who bought a serious fixer in SL and is now drowning in the troubles of dealing with the city and renovations – I have learned to appreciate flippers.

      Move in ready homes have some huge advantages unless you are considering a career change into general contracting.

      Kudos to these guys for doing the work and getting paid in the process

      • Thank you for writing this… it could not be more true. 99% of buyers in this marketplace are NOT in any position to do their own renovations… you can buy a flip with 3.5% down FHA loan and not worry about SH*T.

        • I would add that it depends on how ethical – and how thorough – the flippers are. A lot of the older 1920’s and 1930’s homes need to be taken down to the studs, and I think there are flippers (maybe more so in Highland Park than in Silver Lake/Echo Park) who try to do minimal cosmetic work and resell for a quick profit. Look at the little house just off Fletcher and Larga (I think it’s on Silver Lake Street or Avenue); the buyers did a crappy job and didn’t bother to pull any permits until they got busted by LADBS. I’d also strongly recommend that any potential buyers of a flip (or any old home, for that matter) camera the sewer line – and have it recorded on a DVD – because I suspect a lot of home flippers don’t bother repairing or replacing the old, often worn-out or broken cast-iron or clay main drain lines.

    • Finally a homeowner

      As someone who was specifically looking for a home to renovate and had MULTIPLE properties we had offers on be snatched up by flippers, I agree with you B.E. Nothing more frustrating than seeing homes you put offers on bought by flippers and then put them back on the market at prices we could never afford.

  8. Well lets face it, it’s only getting more expensive to live in the city. EP is no longer up and coming it is hip and expensive. Highland park is already more than half ways there. There are a lot of people in LA with wealth, so if you are an average couple looking to buy a nice home in a hip area you may have already missed the bus. As I read this article I couldn’t help but think that this is only good news for other eastside neighborhoods with reasonable home prices.

  9. I think anyone who pays $900,000-plus for a house in Echo Park is absolutely nuts. No matter how charming and eclectic the area is, it doesn’t make financial sense to buy the most expensive house in the neighborhood. Maybe the buyers have so much money that it doesn’t matter that they overpaid. Mark my words: Most of the folks who have bought homes in Silver Lake, Echo Park, Highland Park, and Atwater Village in the last six months will find – within two years – that they overpaid. We’re in a bubble that’s driven by low interest rates, and by the feeling that “If I don’t buy now, I’ll be priced out of the market!” The time to buy was two years ago – not now, unless you can pay all-cash and are willing to look at areas that aren’t red-hot. Where, you ask? Altadena, Sunland/Tujunga, parts of the San Fernando Valley, and El Sereno (90032).

    • James, while I agree there may be increased demand because of low interest rates. I don’t think one is over-paying in this Echo Park Silver Lake market (even at today’s prices). This area with it’s proximity to amenities and major infrastructure has restricted ability to increase supply. Also, the trajectory of gentrification especially in Echo Park will continue to increase the quality of supply as well as the businesses that cater to them.

      The biggest factor of all is leverage. The smart investor knows that because of the government’s “quantitative easing” policies there is a massive wave of inflation (perhaps hyper-inflation) which will drive prices for everything up. So mostly I disagree that buying all-cash is “smart” unless they in turn mortgage the majority of the home after purchase.

      Because of this, I agree that if one does have the means to buy, they should as the gap between owners and non-owners will increase.

      • As a point of clarification, the only reason I mentioned purchasing a house all-cash is because that seems to be the only way to get a good deal, especially when making an offer on a fixer-upper or foreclosure. I’d advocate that someone pay cash – just to get the offer accepted – and then take out a first trust deed once the sale is complete. Interest rates are ridiculously low – one major upside from this recession. I still believe that prices will drop in the areas I mentioned within two years, but I see your point.

  10.  “Altadena, Sunland/Tujunga, parts of the San Fernando Valley, and El Sereno (90032).”

    Might as well move to the high desert or the inland empire !

    • The Lake Avenue exit off the Gold Line delivers you to the doorstep of Altadena; Sunland/Tujunga aren’t that far away, and neither are El Sereno or parts of the SFV. The point is, first-time buyers can’t have everything they want, and if prices are skyrocketing in the areas where you’d like to live, then it’s time to consider other areas. Or not. It’s perfectly fine to sit this bubble out and wait for prices to dip again.

      • People who want to buy on the eastside are looking for an urban lifestyle. The SGV and SFV are the epitomy of the suburbs. Totally different lifestyles and buyers.

        • Silver Lake (except the areas just north and south of Sunset) and Atwater Village are pretty suburban, and so are Highland Park and Eagle Rock. Someone who wants the urban experience could search for a home in North Hollywood (south of Burbank Blvd.), and they’d be near the NoHo area – with its restaurants, playhouses, and new Laemmle Theater – and the Red Line station. I understand the allure of Silver Lake and its environs – I grew up there and purchased a home there in 1997 – but I would never compete in such an irrationally-heated housing market unless money were no object.

          • I never knew that the city of Los Angeles was a suburb. Some areas have a neighborhood feel, but areas such as altadena are suburbs to Los Angeles not Eagle Rock it is Los Angeles. And the valley, well… if you consider that urban living we obviously don’t see eye to eye.

          • The San Fernando Valley is within the city of Los Angeles; there are plenty of suburbs within the city of Los Angeles. Again, the issue is where potential home buyers are willing to sacrifice in order to get their foot – literally – in the door. When I bought my first house in Silver Lake in 1997, I had a friend who was renting in Venice and refused to consider buying a house in Silver Lake – Echo Park because “I need to be near the ocean.” If he had purchased a home for $150,000 in Echo Park or Silver Lake – or $140,000 in Mount Washington or Highland Park – in 1997, then he could have sold it for $600,000 ten years later and used his equity to buy a home closer to the ocean. Anyway, he’s still in Venice, still renting (two bedrooms for around $1900 a month). To each his own.

  11. Los Angeles couldn’t not be New York for very long.

  12. The re-do on this house is outstanding. However, the neighboring lot looks like it’s occupied by a serial killer. A set designer couldn’t assemble a hotter mess: rusted-out cars, a decaying shack or two, junk everywhere. The realtor said the occupant of the property is “lucid” LOL and intends to clear the property out. Yeah right. This re-do was done in the most hipster-est “industrial chic” style but living next to a Superfund site is too much industrial chic for my blood.

  13. It’s CAPITALISM, stupid!


  14. It’s the juiced interest rates, and it needs to stop as it’s perverting the market.

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