Interested in how this million dollar house in Encino, CA is going down

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On my way to work I noticed this 5000+ sf house in Encino, CA  that is all boarded up.  Looked it up on Zillow and it looks from my untrained eye that it:

- Went to auction for somewhere betwen 500 and 800k.
- Sold for 1.1m
- New owner will fix it up for a few hundred thousand
- And possibly sell for 2m?

Any thoughts on my analysis?  Here is the house: http://www.zillow.com/homedetails/5040-Hayvenhurst...

thanks!

Haha, oh California, I can't say I've ever seen a million dollar boarded up home before! $2mil doesn't seem unreasonable if you look at the recently sold homes nearby on Zillow. You have homes half the size selling for over a $1mil.

I like the photo of the mailbox that they included! lol

@Fernando Corrado  I live near that home. Some developer bought that site and tried to develop that McMansion there several years ago, but ran out of money. They tried to sell it in its current uncompleted state for years. In December of last year it went to foreclosure auction, and, as you correctly noted, someone picked it up for $1.1M. That part of Hayvenhurst, as you probably know, is a main roadway for commuters, so location is not ideal for homes in that price range. But, assuming the new owners are wise in how the do the rehab, they should be able to flip it for a profit. 

Just to follow up, sold for 2.2 mil in January.