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Let's Postpone Our Way Out of This Mess

In addition to the profiling of our real estate friends foreclosing away, the U-T story this past weekend also had some pretty scary numbers. For example, there were 1,305 actual foreclosures in January, this was up 257% in comparison to a year ago. With only 1,826 homes sold, the number of foreclosures in the county may soon overtake home sales.

What is even scarier is what's not published. These foreclosure numbers are actually lower than expected because of the 'postponement phenomenon.'

Let's check out the Ocean Beach Real Estate Barons, made up of brothers John and Steven and their wives Kathleen and Karen. By mid-2005, the 4 of them were well on their way to total financial independence through the purchase of 12 properties in Ocean Beach and Hillcrest. Unfortunately, in a story often heard here at BMIT, the 4 soon ran out of cash and started getting their NOD notices in late 2006 and early 2007. Now here's what really gets interesting...

4344 POINT LOMA AVE, 92107 (2,025 sqft)
--03/2005: purchased for $1.695 million by John
--11/2006: NOD
--2007-03-30 POSTPONED
--2007-04-02 POSTPONED
--2007-05-02 POSTPONED
--2007-05-16 POSTPONED
--2007-06-15 POSTPONED
--2007-07-06 POSTPONED
--2007-07-20 POSTPONED
--2007-08-07 POSTPONED
--2007-08-17 POSTPONED
--2007-08-21 POSTPONED
--2007-09-04 POSTPONED
--2007-09-11 POSTPONED
--2007-09-13 POSTPONED
--2007-09-26: REO to bank for $1,150,000
--13 postponements here, NOD to REO took 10 months, not yet listed for sale.

4060 VERMONT ST, 92103 (829 sqft)
--purchased by John, date unknown
--12/2006: NOD
--2007-03-29 POSTPONED
--2007-04-05 POSTPONED
--2007-05-31 POSTPONED
--06/2007: REO to bank for $717,650
--only 3 postponements here, NOD to REO took 7 months.
--12/2007: sold as REO for $369,000

1068 PASCOE ST, 92103 (910 sqft)
--07/2002: purchased for $206,000 by John
--12/2006: NOD
--03/2007: cancelled auction
--01/2008: REO to bank for $467,500
--NOD to REO took 13 months here, not yet listed for sale.

4905 NARRAGANSETT AVE, 92107 (504 sqft)
--10/2004: purchased for $515,000 by John
--12/2006: NOD
--03/2007: cancelled auction
--14 months since NOD, property still in limbo.

4062 VERMONT ST, 92103 (644 sqft)
--purchased by John, date unknown
--01/2007: NOD
--2007-04-05 POSTPONED
--2007-04-12 POSTPONED
--2007-06-07 POSTPONED
--2007-06-21 POSTPONED
--2007-06-28 POSTPONED
--2007-07-03 POSTPONED
--2007-07-17 POSTPONED
--2007-08-14 POSTPONED
--2007-09-13 POSTPONED
--2007-10-12 POSTPONED
--2007-10-19 POSTPONED
--11 postponements, 13 months since NOD filing, status still in limbo.

4771 NEWPORT AVE, 92107 (1,056 sqft)
--10/2004: purchased by John for $750,000
--01/2007: NOD filed
--2007-04-04 POSTPONED
--2007-05-04 POSTPONED
--2007-06-04 POSTPONED
--2007-07-09 POSTPONED
--2007-08-09 POSTPONED
--2007-09-14 POSTPONED
--2007-10-15 POSTPONED
--2007-11-15 POSTPONED
--8 postponements so far, now going on 13 months since NOD, we are still awaiting auction.

4475 OSPREY ST, 92107 (1,110 sqft)
--12/2004: purchased by Kathleen for $960,000
--01/2007: NOD
--2007-04-05 POSTPONED
--2007-05-07 POSTPONED
--2007-06-07 POSTPONED
--2007-06-28 POSTPONED
--2007-07-30 POSTPONED
--2007-08-13 POSTPONED
--09/2007: REO to bank for $741,344
--6 postponements here, NOD to REO took 9 months.
--12/2007: sold as REO to flipper for $780,000, listed on Zillow for $850,000.

4393 SANTA CRUZ AVE, 92107 (1,050 sqft)
--10/2004: purchased by Kathleen for $835,000
--03/2007: NOD
--07/2007: REO to bank for $700,153
--10/2007: listed for $714,900 as REO
--no postponement here, but NOD to REO listing timeline still took 7 months.

1186 BARCELONA DRIVE, 92107 (1,234 sqft)
--02/2005: purchased by Steven for $1.025 million
--04/2007: NOD filed
--07/2007: auction delayed
--10 months since NOD filing, still in limbo.

1815 FROUDE STREET, 92107 (1,343 sqft)
--04/1998: purchased by Steven and Karen for $315,000
--04/2007: NOD filed
--07/2007: auction date… reinstated?

4744-4746 CAPE MAY AVENUE, 92107 (896 sqft)
--03/2005: purchased by Karen for $660,500
--01/2007: NOD filed
--2007-04-30 POSTPONED
--2007-05-07 POSTPONED
--2007-05-08 POSTPONED
--2007-05-15 POSTPONED
--2007-05-31 POSTPONED
--2007-06-29 POSTPONED
--2007-07-13 POSTPONED
--2007-07-27 POSTPONED
--2007-08-10 POSTPONED
--2007-08-24 POSTPONED
--2007-09-07 POSTPONED
--2007-09-21 POSTPONED
--2007-10-05 POSTPONED
--2007-10-29 POSTPONED
--14 postponements and 13 months later, we are still awaiting auction.

4747 NIAGARA AVENUE, 92107 (642 sqft)
--03/2005: purchased by Karen for $625,000
--12/2006: NOD filed
--2007-03-28 POSTPONED
--2007-04-04 POSTPONED
--2007-04-18 POSTPONED
--2007-04-25 POSTPONED
--2007-05-02 POSTPONED
--2007-05-04 POSTPONED
--2007-05-18 POSTPONED
--2007-07-18 POSTPONED
--2007-07-25 POSTPONED
--2007-08-08 POSTPONED
--2007-08-22 POSTPONED
--2007-08-29 POSTPONED
--2007-09-12 POSTPONED
--2007-09-26 POSTPONED
--2007-11-26 POSTPONED
--15 postponements and 14 months later, we are still awaiting auction.

Word on the streets of Ocean Beach is that John has some hired gun taking the lender to court in order to prolong the foreclosure as long as possible. Perhaps as a strategy to delay things until the market improves? Or perhaps this is just a way to milk as much rent money as possible?

Regardless of the true intentions of our RE Barons, on a macro scale, the end result is that the current foreclosure numbers are lower than expected, and foreclosures will continue to hit peaks beyond our wildest imagination for some time to come.

It should be noted that the RE Barons of Ocean Beach are not realtors. They are CONTRACTORS®. Thank you to Dr. Keeler and Mystery Contributor for the information above.

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