patrick.net

This 5/3 3038 sqft place a couple blocks away sold for $1.35M as a non-short sale:

http://www.redfin.com/CA/Cupertino/1328-Rose-Garden-Ln-95014/home/1516421

That is less than its April 2005 sale at $1.368M.

1282 Poppy has a slightly bigger lot and is a 4/3.5, but about the same square footage at 3012 sqft.

It looks like the buyers were wannabe flippers. They first listed the place in 2007 for a 24 month sale. Then they listed again in 2008 figuring they could make a deal during the summer selling season, and failed again. Hard to believe they paid $1.631M in 2005, but they got fooled by the new house smell.

Move away from crapertine more than 60 % are chindians )

No, $1,268,000 is a HORRIBLE price. It's more than twice the actual value:

http://patrick.net/housing/calculator.php?forsale_ID=1623708

Run away!

That is a good calculator, Patrick. For example, if you lived in the house for 20 years, and housing prices only went up 1% a year and rent went up 2.5% a year, you would still be better of monetarily by renting.

RealtyTrac claims that 1282 Poppy Way has date with the courthouse steps on June 24 and shows over $1.6million owed. Don't worry, they put 10% down. I mean, what could go wrong with two 'variable rate' mortgages from America's Wholesale Lender? Perhaps they got a reprieve?

Anybody who reads this site who has to ask, cannot afford it.

Even if they think they can.

Thanks for the replies.

Are we sure the prices in Cupertino is not going to rise or going to stay stable?

I agree that the previous buyer bought it at peak.

I'm in the 33% tax bracket, and my taxes are killing me (almost paying 80k$ on taxes). I thought if the price is going to hold, then I might save money.

I'm not sure if I buy in milpitas area where I can get newer home in 800k$ range, would it be a good buy?

I want to know the probability of prices falling/rising in milpitas compared to cupertino.

crazydesi says

I’m in the 33% tax bracket, and my taxes are killing me (almost paying 80k$ on taxes)

If you can afford to 80K on taxes, I don't think they are killing you. It's a rich person's problem.

As per the calculator I use, I can save 30k$ per year on taxes, If I buy this house. So in 10 years I can save 300K$ on taxes alone. If the price is stable as long as it does not fall, I should be fine? Is it not? My lease is ending soon and my owner is giving away this home to his kids, and I hate moving from place to place every year.

sybrib:

I'm in worst case of paying taxes.

I dont have kids and I rent a house, and we are just two people in the house, so no extra deductions. Its only the 401k which I'm having for tax savings. I lost money in stock market, so dont trust it anymore. my bank does not pay good interest, so it is waste to put money in bank.

what do I do? Any suggestions?

crazydesi says

what do I do? Any suggestions

Be thankful you're not on the streets.

Invest a little bit in people, in your community. You can even deduct it from your taxes!

Im already giving away 80k$ for the society, If I give more, then defiantly I will be on streets.

crazydesi says

As per the calculator I use, I can save 30k$ per year on taxes, If I buy this house. So in 10 years I can save 300K$ on taxes alone.

The mortgage interest deduction is a discount on the interest rate you pay -- it is not a net tax benefit, because you have to pay 5% interest, for example, in order to save 1.5% of the rate via taxation. You need to compare it to renting in order to determine whether you have a net monetary benefit.

In addition, the mortgage interest deduction is incorporated into the price of houses -- if the deduction did not exist, then housing prices would be higher.

The mortgage interest deduction will also decrease over time. It may be $30K in one year, but it won't be $30K 9 years later.

crazydesi says

Any suggestions?

Buy properties in Mumbai for a quick 12 times money making. :)

Nomo,
that's also how markets don't work, like in many places in 2006.

Nomograph says

That’s how markets work.

Ever heard of market failure? It happens sometimes. Think banksters.

Nomograph says

The actual value is what it sold for on the free market, not a made-up number on a calculator.

No, the asking price is the made-up number. The calculator just uses math to find the break-even point between owning and renting the exact same thing.

Owner loses in this case, showing the price is far greater than the actual value.

Run away!

The NOTS was filed on 2/9/11. RealtyTrac also showed an earlier auction date, so perhaps that bank is looking for the "highest bidder" with bank financing versus the guy with a suitcase full of cash on the courthouse steps. Will be interesting to see if this property goes the distance.

EBGuy says

suitcase full of cash on the courthouse steps.

Some one rich with recent IPO offerings is all set.

bubblesitter says

Some one rich with recent IPO offerings is all set.

Better wait for the 180 day lockup period to end, first. Also, isn't P at par now?

corntrollio says

bubblesitter says

Some one rich with recent IPO offerings is all set.

Better wait for the 180 day lockup period to end, first. Also, isn’t P at par now?

I was referring to the Palo Alto story. Can't find the link.

bubblesitter says

I was referring to the Palo Alto story. Can’t find the link.

Some form of this article, maybe?

http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2011/06/14/bloomberg1376-LMIF0E1A74E901-0N2R7Q2ST1TU21TT53UQ78166N.DTL&ao=all

These trend stories are stupid, because they're talking about the LinkedIn IPO, when the shareholders are still subject to lockup, and because they only mention the houses that go significantly above asking because they were underpriced to begin with.

crazy my friendly and Desi suggestion to you.

Don't buy in Milpitas , you should buy in a place where people from All ethinicities desire to buy ( Not just one ethinic group ).

Look in the Map for Areas which still has good schools 850-930 API and the prices are still not over the head- you'll come to a natural conclusion.

Seems there will be lot of bidding for this house ... I'm planning to stay away as per Patrick's suggestion.

Are Milpitas schools not good?

cloud13 says

crazy my friendly and Desi suggestion to you.
Don’t buy in Milpitas , you should buy in a place where people from All ethinicities desire to buy ( Not just one ethinic group ).
Look in the Map for Areas which still has good schools 850-930 API and the prices are still not over the head- you’ll come to a natural conclusion.

crazydesi says

lot of bidding for this house

Good decision for that reason.

bubblesitter says

crazydesi says

lot of bidding for this house

Good decision for that reason.

I agree. The main flaw in our system is that real estate is a completely secret auction, and there are huge incentives to lie. You have no ability to actually know what the other bids are, or even if they exist.

Only the seller's agent knows the truth about what other bids there might be. Not even the seller knows, because buyers are not allowed to talk directly to sellers.

You can't even sue for fraud, because you don't have the legal right to get documentation of the other bids.

One helpful technique: mail a copy of your bid directly to the seller's house, just so their agent can't block it.

As per the agents info it is a short sale, so not sending my bid (saving paper and printer ink)

How about these?

http://www.redfin.com/CA/Milpitas/821-Strickroth-Dr-95035/home/1506383

http://www.redfin.com/CA/Milpitas/935-N-Hillview-Dr-95035/home/1703561

http://www.redfin.com/CA/Milpitas/855-De-Anza-Ct-95035/home/727769

Are they good.

bubblesitter says

crazydesi says

lot of bidding for this house

Good decision for that reason.

I agree. The main flaw in our system is that real estate is a completely secret auction, and there are huge incentives to lie. You have no ability to actually know what the other bids are, or even if they exist.
Only the seller’s agent knows the truth about what other bids there might be. Not even the seller knows, because buyers are not allowed to talk directly to sellers.
You can’t even sue for fraud, because you don’t have the legal right to get documentation of the other bids.
One helpful technique: mail a copy of your bid directly to the seller’s house, just so their agent can’t block it.

I agree. The main flaw in our system is that real estate is a completely secret auction, and there are huge incentives to lie. You have no ability to actually know what the other bids are, or even if they exist.

Yes, this is a problem. However, the problem is also on the buyer side, where people get too emotionally invested in a particular house and bid irrationally for it. If people were comfortable with the price they bid, they wouldn't fall for situations when the used house salesman is bluffing. There are always more houses, and it's rare that a particular property is truly unique. A Pacific Heights mansion might be unique (or perhaps just rarely on the market), but a random 50s or later tract home in Silicon Valley is almost certainly not.

One helpful technique: mail a copy of your bid directly to the seller’s house, just so their agent can’t block it.

This is a good idea when the used house salesman is being obstructive. Nothing prevents you from knocking on the seller's door. Sometimes, you'll get some BS from the used house salesman that "this bid is so low as to be insulting," and they won't take it to the seller even though it's a fair offer. Sometimes those houses will sit and sit.

I've heard stories about people offering $X for a house, and the used house salesman will reject it out of hand for being too low. Then the seller or bankster will chase the market down, and beg the prior bidder to buy it for $X several months later. Rightfully, the bidder should say (and has said), "my offer is less than $X now."

What we also need is a system where the used house salesman actually has fiduciary duties. If you're a lawyer, and you get a settlement offer, you have an ethical obligation to take the offer, no matter how crappy it is, to your client.

crazydesi says

Seems there will be lot of bidding for this house … I’m planning to stay away as per Patrick’s suggestion.
Are Milpitas schools not good?
cloud13 says

crazy my friendly and Desi suggestion to you.

Don’t buy in Milpitas , you should buy in a place where people from All ethinicities desire to buy ( Not just one ethinic group ).

Look in the Map for Areas which still has good schools 850-930 API and the prices are still not over the head- you’ll come to a natural conclusion.

Look in Cambrian , It's more cosmo, it has good schools and eveywhere around is nice. It's surrounded by Wilo Glenn, Campbelll, Los Gatos and Almaden.....So it's good from all sides

corntrollio says

people get too emotionally invested in a particular house and bid irrationally for it

Eh, now I know what caused the bubble. :)

corntrollio says

Nothing prevents you from knocking on the seller’s door

But the seller is brain washed by the RE dude, DO NOT talk the buyer directly.

Cloud13 is right, Cambrian is a good value in Santa Clara county. Good schools, nice and pleasant, cheaper than Cupertino and West SJ. And more diverse if that is important. Some may prefer these schools to Fortress schools due to less pressure.

Only real drawback is longer commute to most jobs.

SiO2 says

Cambrian is a good value in Santa Clara county.

It depends on the PRICE. Cambrian is a nice place, but if they charge you two or three times what it's worth, then you got a bad deal.

It is always possible to pay too much. Don't overpay, and your life will be much more pleasant.

bubblesitter says

But the seller is brain washed by the RE dude, DO NOT talk the buyer directly.

I hear that. Used house salesmen would be out of business if home sellers realized that most realtors have no real expertise in anything, that all realtors really provide is standardized forms, and that buyers and sellers could save a hell of a lot of money by hiring a good real estate attorney instead of an incompetent realtor.

I've heard realtors contend that they are really good at helping people navigate the disclosures. Are they committing unauthorized practice of law? Because if they are really helping with disclosures, that could be construed as legal advice. A good lawyer would be better and cheaper than the majority of used house salesmen.

There are very few realtors that are truly able to add value.

SiO2 says

Cloud

SiO2 ..the commute is only a problem if you want to find a job in SF but everything else is great. My wife works in Cupertino and it's just 10 miles ( No Hassle). Also I goto Palo Alto once a fortnight ( 20 miles) and again it's no Hassle.

No, $1,268,000 is a HORRIBLE price. It’s more than twice the actual value:
http://patrick.net/housing/calculator.php?forsale_ID=1623708
Run away!

This is a very conservative calculation, because it assumes only a 1% annual reduction in price, which will be more like 7-8%.

crazy - please make sure you understand the mortgage interest deduction before basing a decision on it. you can only deduct interest paid. if you pay a bank $1 in interest and you get a 30 cent tax break, you are still out 70 cents.

Yeh, but we folks in Santa Clara County can sure use that Property Tax payment that crazy will have to make each year.

So, please, through some money to local government.

Thanks !

crazydesi says

Im already giving away 80k$ for the society, If I give more, then defiantly I will be on streets.

Are you trying to be funny? If your 33% tax bracket is $80K, then you're earning $240K... what are you doing with that $160K?

Hey I earn less than half of your salary. How is it possible that I'm still alive???

crazydesi says

As per the calculator I use, I can save 30k$ per year on taxes, If I buy this house. So in 10 years I can save 300K$ on taxes alone.

Depends on your down payment, but you could be paying $90K a year in interest. That's $900K over 10 years. I suppose you think it's better to give $90K a year to the greedy banks vs $30K a year to uncle sam.