New to Market: Eagle Rock's Rock Row
Friday, April 17, 2009, by Dakota

Touting themselves as "green and lean," those Eagle Rock Rock Row units have been hitting the MLS over the last couple of weeks. According to Redfin, the project is “over 50% sold in 2 weeks.” As Curbed reported last year, Rock Row comes to us via the Small Lot Subdivision Ordinance, which allows developers to build a collection of single-family homes or detached town houses on a single lot. Via the listing: "Plan A unit features “2 br+ 2Ba, 2 story, lg open floor plan, 2 car attached garage, laundry rm, master br w/walk-in closet and private bathroom, high end fixtures and finishes throughout, 10' ceilings.” There's been debates about whether the small lot ordinance results in more affordable units: This one is priced at $482,000 for 1,310 square feet of living space. At least it's another option for those hordes of young professionals moving east from spendy Silver Lake and Echo Park. And here are photos of the opening party held last month (scroll down)----Hailey Zaki
·
ROCK ROW blog [Rock Row]
· 1546 Yosemite Dr Unit 3A [Redfin]

Comments (83 extant)
guest

Um, $482k for an Eagle Rock condo is pretty friggin' spendy.

I can't believe people are still overpaying for this garbage.

We've got a long way to go before we hit bottom in this town.

guest

Sorry #1 - I think this is a fair price for such nice places. It's much less than some old house in that area and way more modern. If I were in the market I'd snap it up. I agree the market might - or will - go about 10-15% lower or so, but that wouldn't make that much of a difference on a home in this price range and should recoup that over the next several years. however, with a limited # of places available, it's doubtful any of these would be available. That's a risk I wouldn't want to take if I truly liked these. A house is a home as well as an investment. If you like this, and can afford it, why not?

Pabst Pabst

..from spendy Silver Lake.

Another reason to love Dakota. I can impress my rube friends in Chi-town with a new urban dictionary adjective. You go girl!

guest

I like how the name for this place sounds like "rut roh." but seriously, nice finishings. It's too bad that if this were on the westside, it would cost $800k+ for a 2br/2ba

guest

Clearly #2 must be connected with the ownership in some manner.

“over 50% sold in 2 weeks.” is not according to Redfin but according to the agent / developer who posted on Redfin. We all know how truthful sales people and developers are so no need for further comment.

10%-15% drop in price is huge on a $482K home. Why would you buy now if you believe your equity is going to be wiped?

Lastly, the finishes are nice but not out of the ordinary and you're spending $368 PSF in Echo Park. To anyone stupid enough to spend this kind of money for this product, I wish you the best and let's check in a year from now and see if it was such a wise decision.

guest

"I think this is a fair price for such nice places. It's much less than some old house in that area and way more modern.:

Sorry #2, not so much.

http://www.redfin.com/search#lat=34.135369950951294&long=-118.207205501406&market=socal&max_price=475000&region_id=786&region_type=1&status=1&v=4&zoomLevel=14

When you can buy nice SFRs in Eagle Rock for substantially less money thanks to short sales, why would you shell out that kind of coin for a condo?

There will be plenty of nice real estate on sale in 2010-2011 once the Alt-A/Option ARM resets hit, and Eagle Rock is a once and future middle class community, so overpaying for condos there is a sucker's bet.

STARCHY STARCHY

I went to the open house party and I was frankly shocked at how much I liked these units. They have nice roof decks and a good open feel to the interiors and floor plans- the views are cleverly framed and they are ideal for someone looking for zero maintenance living. I have to say I was very impressed.

Note that they are not condos; you own the land and the building fee simple.

They two guys that built it are interesting pair- according to their presentation they spent about $161/sf in construction, and some of the eco-friendly things they did were pretty clever.

and NO I don't have any financial interest in these.. but of course I would love for them to succeed as I am very bullish on Eagle Rock

that said they are pretty close to the High School, which is not a good thing in my opinion...

STARCHY STARCHY

@guest (#5):

uhm not "Echo Park"...

as for having "10 - 15% of your equity wiped out" we have ALL been through this argument so many times...

what % of your rent is wiped out each month?

guest

^ a fraction of this mortgage of this glorified condo. in eagle rock, no less.

STARCHY STARCHY

^^ can you try that again please? thanks

guest

Starchy,

Yes we have been through this argument before. What is the mortgage payment on a 80% loan given current interest rates. Let's just say $2,300. Let's say tax deductions take care of the HOA and property taxes. Given rent reductions and free rent concessions, I think you can rent something comparable to this place for $2K-$2.3K /month.

And initially the great majority of your mortgage payment cover the interest on the principal balance, so you're not materially reducing the loan.

So, yeah your equity is nearly wiped out plus there is no economic benefit vs. renting.

guest

sorry starchy, i type fast. guess you are too stupid to deduce this.

"a fraction of this mortgage of this glorified condo. in eagle rock, no less."

simply replace my first instance of "this" with "the", and my second instance of "of" with "on" and voila! a sentence even you can read!

to simplify (for you): "a fraction of THE mortgage ON this glorified condo. in eagle rock, no less."

STARCHY STARCHY

@guest (#12): fuck you asshole. you wrote gibberish and I asked very politely what you meant.

and even after you tried a second time it still reads like shite.

now you go have a nice day you fucking prick

guest

Um, $482,000 with 20% down equals about $385,000 loan. A current 30-year fixed at 4.75% is $1600 per month, some of which WILL go towards principal. Of course, you still need to add in another $400 for taxes. But that's still $2000 per month. Plus you get around a $20k-per-year tax writeoff and PRIDE AND FREEDOM OF OWNERSHIP, and a damn nice looking townhome.

This is a much better deal than renting...if you have the down payment.

Why such negativity on home ownership around here?

Pabst Pabst

@STARCHY: ...according to their presentation they spent about $161/sf in construction. Thanks bro! Some of the best info I've received here or anywhere in the recent past. So much for the douchebags who've told me $300 is rock bottom cost-no pun for Eagle Rock, btw.

STARCHY STARCHY

@guest (#11):
"I think you can rent something comparable to this place for $2K-$2.3K /month."

really? where? whats the address?
(brand new townhouse with covered parking).
get back to me when you find it.
I think you can rent something comparable to this place for $2K-$2.3K /month.

plus the HOA fees are miniscule- some common area lighting maybe, what else?

and how pray tell does your "equity get (nearly) wiped out"?
what if you have 15 year fixed and you live there 15 years?

Regardless, if I read you right, the mortgage payment and rent are the same- so why NOT buy? let me guess- return on your down payment cash?

guest

"Why such negativity on home ownership around here?"

Probably because owning a "damn nice looking townhome" doesn't really provide that much pride of ownership, especially in Eagle Rock, especially compared with the "convenience of not having to do any maintenance or upkeep" that comes with renting.

2-3 years from now when you can buy a perfectly nice 3bd/2ba SFR in Eagle Rock for $200-250k, then it might be time to reconsider.

(Disagree? You probably thought those Americana condos weren't going to drop in price either.)

STARCHY STARCHY

@guest (#14):

and when you DO sell, proceeds are tax free.

guest

@STARCHY: I see Starchy has that hair up his ass again.

guest

oh horse shit starchy, you did not "ask politely". sarcasm is easily identifiable. your a little prick.

and you clearly understood the point of my post. your just an asshole.

sorry it reads like shit to you, and who the fuck cares if it does? its your opinion. and not a very valid one around here. guess i won't pursue a journalism degree!

STARCHY STARCHY

@guest (#17):
"Probably because owning a "damn nice looking townhome" doesn't really provide that much pride of ownership, especially in Eagle Rock"

so who are you to make that decision for everyone? Why is your subjective opinion gospel?

"the "convenience of not having to do any maintenance or upkeep" that comes with renting."

what upkeep and maintenance is required in brand new townhome? Changing light bulbs? watering your roof garden?

re: renting. what about the 20 year old refrigerator in your rental? or nasty leaking vinyl sliders? or noisy window a/c? paradise!!

STARCHY STARCHY

@guest (#20): for what its worth I was NOT being sarcastic and believe me my opinion has much more validity "around here" than the pointless posts of an anonymous troll.

guest

^ you don't find it odd that your the only almighty "registered user" that continually gets blasted by the "trolls" for being a prick?

STARCHY STARCHY

@guest (#23): I'm the only one who bothers to smack you back.

now do you have anything to say or add to this discussion?
(other than you laughable assumption that rent is a "fraction" of the mortgage you would pay on this place)?

guest

@guest (#14): Not sure how you get to 20k. Yes, you're paying above 20k (assuming there's points in there) in interest in the first year, but it's a below the line deduction. Assuming this buyer is in the highest rate, which he or she almost certainly isn't, the after-tax savings is about 9k versus a standard deduction for a single person of 5.7k reducing tax liability by 2.5k. So you're saving 6.5k under the most favorable assumptions, which is nothing to sneeze at, but for the actual buyer (earning 80k? 100k?) the savings are probably much less. And they fall off from there with the amortization schedule.

guest

"I'm the only one who bothers to smack you back."

what does that even mean, it has absolutely nothing to do with the post i made, however, it seems like that is some sort of reply???

once again, you miss the point and move on...

guest

^^ Actually three of those are nearly the same price per foot. One is actually more per foot, and they are quite possibly the ugliest houses Ive ever seen. There is no comparison.
Im not interested in buying in Eagle Rock, but if your going to have a worthwhile discussion about comps and least show something in the same realm.

guest

@STARCHY: Not the above commenter, but just to give an example, I've been renting a 2/2 for the last few years. Every month in that the time frame the value of the property, based off comps, has dropped more than my rental payment, meaning I would have lost more in equity each month than I'm paying in rent and that's before everything the owner is paying.

Situations are unique, but this isn't terribly uncommon given the fairly precipitous decline from the bubble peak, and the difference between price and rent at the top. At the current rate of decline, it probably wouldn't be that different if I renewed today either since there's no way I'd renew without a substantial lowering of my rent. Plenty of places I could move for less, and the landlord, who's a reasonable, nice guy, knows it, and wouldn't want to lose me as a tenant.

guest

20% down, 6.5% interest, roughly $3000 a month? no? not including utilities, taxes, maintenance, etc...

first decent looking rental i stumbled upon craigslist:

$1600 all utilities paid
http://losangeles.craigslist.org/lac/apa/1127238558.html

is half a fraction???

guest

@guest (#20): In starchy's defense, I didn't understand what you meant either, even after you clarified. Maybe try using complete sentences.

STARCHY STARCHY

@guest (#27): thanks for that #27
If I had same the exact same thing they would call me an asshole.

STARCHY STARCHY

@guest (#27):
au contraire.... you asked me specifically why trolls call me a prick and I provided you with an accurate and relevant answer.

now if you would like me to explain it to you, ask nicely and I will.

travelingman travelingman

I think Eagle Rock is a really cool area. I like it.

These are nice looking condos

I think the fact that they're asking $482K - that causes many to go into a hyper-reaction of "oh my, it's so cheap" since we've become so accustomed to cracker jack box homes (2 br/1ba in ok areas going for $600K ludicrous prices plus)....

anytime, i read of a place less than $500K, i look at the post or listing.

However, at $3K/mo for a condo plus HOA, with likely more price drops of value occuring in next 2 years, nah, no thanks. I know people paying $2200-$2500 on westside that get as much....

STARCHY STARCHY

@guest (#31): ... and thank you #20

Believe it or not I really was trying to ask nice... old dog, new trick.

guest

@guest (#28): well i guess it has to do with what your looking for. yes, the condo is a new construction, i don't see any other new condo listings in the area. so where are the comps? my guess would be to look at actual homes, which are in some cases 70+ years old. but isn't a home a better investment than one of these?

guest

"you asked me specifically why trolls call me a prick and I provided you with an accurate and relevant answer."

WRONG!!!!!!!!!!!!!!!!!

read again....

STARCHY STARCHY

@guest (#29): well I would argue that the perceived "decline in value" only matters if the landlord wants to sell- but if he keeps it occupied and is covering his nut what is he losing?

look- prices ARE dropping, no argument, and have been, but they will bounce back at some point, but not (of course) to the exuberant prices of fall 2006 perhaps for some time.

but the fact that "prices" are lower today then they were then does not mean that every single building is, or will be, drowning in a sea of debt

guest

Since these are FEE SIMPLE homes, what are the HOAs per month? Does anyone know? Usually in PUD, they're MUCH lower than in condo buildings like the ones downtown since there isn't that much to maintain. I'd be curious if anyone even knows how much they are.

guest

and even if you were correct, your "accurate and relevant" answer would read as follows"

Q: "why do trolls call you a prick"

A: "I'm the only one who bothers to smack you back."

glass houses on the grammar starchy.

STARCHY STARCHY

@travelingman:
TM- they are NOT CONDOS!! there are no significant HOA fees..

as for "much more" westside...whats the point? different markets,

guest

^ the point is the westside is a more desirable and therefore more expensive market. the fact that these rival those in terms of price answers itself.

guest

@guest (#28): I think those condos are pretty ugly at any price.

STARCHY STARCHY

@guest (#40):
OK let me lay it out for you.

Trolls take shots at people and opinions on this board al the time.
Most registered posters ignore these shots or respond with wit (One Wag) verbosity (Pabst), patience (TM) or marked silence (Curbed Enthusiast)..... but I don't.

Instead I call trolls what they are- assholes, morons. etc....

and the trolls dont like that, so they respond with more insults... (repeat)

go back in the archives and read some of the ridiculous battles I have had with trolls, never ending back and forth, and often they attack my mother, my wife, my dog, my dick... you name it. anal sex is one of their FAVORITE topics...

STARCHY STARCHY

@guest (#42): gotta disagree with you there #42.... cant imagine anyone interested in these condos are interested in living westside, and vice versa. I cant imagine anyone (broker, appraiser, etc..) that would use a westside deal as a comp for Eagle Rock

guest

@STARCHY: are you kidding me? these look like they were transplanted from the westside if anything. what are you trying to say? westsiders don't like modern design????

guest

@STARCHY: well I would argue that the perceived "decline in value" only matters if the landlord wants to sell- but if he keeps it occupied and is covering his nut what is he losing?"

Very true for my landlord who bought a while back, but for me, I could have bought a comparable place and decided not to because the price didn't make sense to me yet with the market looking overheated. Turned out that was the right decision though there was risk involved either way.

guest

@STARCHY: ummm, you didn't really address the post, you just went off again in some alternate tangent. FYI

guest

"I cant imagine anyone (broker, appraiser, etc..) that would use a westside deal as a comp for Eagle Rock."

Me neither, because the Westside is usually much more desirable and expensive, which is why it's interesting to see that you can rent an equivalent place for much less on the Westside.

There's nothing wrong with Eagle Rock, it's a perfectly adequate middle class community.

But in a non-bubble world, perfectly adequate middle class townhomes / minimal lot properties don't go for half a million.

We can rant and argue all we want, but it will be pretty obvious to everyone in 2011-2012 whether this was a good price, or whether the buyers were some of the last victims of the bubble.

I'm guessing it's not a good price.

guest

In response to #16 (Starchy):

I rent a 2 BR home 0.5 miles from the beach in Hermosa Beach and pay $2,500/month. Granted that the Echo Park is a completely different market, I believe that most people would say that my place (with an ocean view) is superior product.
Rented the place in October 2006 when rents were near peak. Just as there is increasing supply for sale, there is now increasing supply for rent. 1-2 month free rent concessions are not out of the norm on 12 month leases (if you negotiate hard enough), so an effective reduction of up to 17% on face rents. I am considering renegotiating the rent on my place. So, while I haven't checked rents in Echo Park, I think you could find something in the $2K-$2.5K effective rent range for comparable product (of course you are not going to find something identical).

My understanding has been that 15 year mortgages are not common and 30 year mortages are the norm. I do not work in residential real estate or I only see Resi RE at a higher level from the financing (lender) side on projects so I am not an expert on the matter. Maybe you work in this area and are more familiar with the matter.

I don't plan to own a place for the next 15 years. I plan to trade up when possible. I think this is generally true for the majority of the LA population. Average length of ownership (in the U.S.) is around 7-8 years.

Somoeone else posted an economic evaluation using a 4.75% rate. Is this really an obtainable rate? I ran my analysis using a 5.5% rate, which is already a generous (low) rate. I don't track mortgage rates on a daily basis because I am not looking to buy now and I don't work in the field.

Lastly, do I view a possible purchase from the view point of a cash on cash return? Yes. I don't see why I shouldn't.

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