As we first reported this January past with respect to 235 Berry #304:
Asking $750,900 when the building was 89 percent sold in January 2007, 235 Berry #304 sold for a reported $751,000 that March ($702 per square foot).
Returned to the market (mis)priced at $849,000 this past May, perhaps based on market (mis)expectations, the asking price for the two-bedroom was reduced to $829,000 in June and then to $675,000 as a short sale in August.
In contract and then relisted twice since last September, on Tuesday the list price for the 1,070 square foot “spacious corner residence” was reduced to $599,000, 20 percent under its 2007 sale and $560 per square, a value which shouldn’t catch any plugged-in buyers or sellers by surprise.
Having fallen out of contract twice since, most recently after being relisted for $699,000, the list price for the two-bedroom condo in the “landmark building” (according to the listing, don’t ask us) is once again $675,000 but now noting: “Approved Short Sale – Buyer walked last minute – cold feet.”
And as a plugged-in reader reported back in January: “I…looked at this unit and the listing agent made it clear that the buyer will need an additional approximately $50k in cash at closing to clear liens by the HOA and PMI company.”
∙ Listing: 235 Berry #304 (2/2) 1,070 sqft – $675,000 (short sale) [MLS]
∙ Shorter Still For 235 Berry Street #304 At $560 Per Square Foot [SocketSite]
∙ 235 Berry Street Update: At Most 89% Sold (And Moving On In) [SocketSite]
∙ An Under $600 Per Square Foot Two-Bedroom Comp At 235 Berry [SocketSite]
I guess I don’t get it. Perhaps I need a refresher on Real Estate law.
HOA fees/dues are recourse and/or personal unsecured debts, no? So why doesn’t the association go after the personal assets of the seller, now, rather than trying to squeeze the new buyer after the close?
All they’re doing by pursuing the lien tactic is hurting themselves and all the other current owners in the complex by delaying the sale of the property (by scaring away potential buyers) and thus suppressing their own collection of current and future HOA fees that are due from the ultimate owner of the unit after the short sale closes.
Given the above situation, I think this place should go for about $550,000.
Well, the seller owes both the bank and the HOA. The bank may settle for $675k, but there’s little incentive for the HOA to settle for $0. The HOA would prefer the bank got $625k and they got $50k.
In other words, it’s not really “approved” when not everybody who needs to approve it has approved it.
I agree with Brahma. What seller owes to HOA is not a loan on the property. So, HOA should use other means to collect it.
I would be surprised if any buyer would agree to pay 50K from their pocket to HOA.
Does HOA have a legal right to stop the sale if banks agree for a lower price? I am sure banks don’t care about HOA dues.
The HOA can put a lien on the place and refuse to remove it unless the lien, including attorneys fees, is paid off. They can also sue the owner personally. In this case, suing the owner is probably pointless. The lien is their best shot at recovery.
If the home gets foreclosed, the lien is extinguished, and the other owners in the complex get to pay off the lien. In this case, the place was built in 2007, so likely there will be lots of walk aways and lots of foreclosures. The HOA will likely rise, and it is already high for a zero amenities but a doorman building, because there are only 99 units.
The buyer was smart to “get cold feet” i.e. realize he was being a sucker, and walk. This building is going to be plagued with this type of problem for years to come. Worth nowhere near the approved short sale price, though maybe the buyer had offered less and tried to negotiate, walking away only when the bank refused.
Interesting, MISSION BAY MAINTENANCE CORP is the only entity (so far) to have filed a NOD on this condo. There are NOTICE ASSESSMENT LIENs by both the HOA and Mission Bay Maintenance.
The sale of 235 Berry #304 closed escrow last week with a reported contract price of $625,000 ($584 per square foot).