Funny about Money

The only thing necessary for the triumph of evil is for good men to do nothing. ―Edmund Burke

Real Estate, Money, and Style

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So the handsome young Mega-Church Audio Engineer, who apparently earns a fairly decent living if the cars he and his wife drive are any indication, has put his house on the market. This two-child couple are classic urban upwardly mobile folk, the sort who buy in an aging neighborhood like ours and, bless’em, handsomely fix up decrepit houses that they perceive a) as better built than the present ticky-tack and b) quaintly Mid-Century Modern.

The house they bought was a crumbling rental right behind the house SDXB  used to live in.

The original owners, a reclusive pair who had lived there for at least a couple of decades, were thought to be mother and son. Whatever they were, they were quiet but strange: good old-fashioned slobs. They let the place run down year after year after year.

Way. Way. Waaaaaayyyy down.

Eventually they sold the place to the Perp, a guy who turned our neighborhood into his personal rental empire by converting every home he could grab from elderly original owners, who had no idea they were giving away their property for a fraction of its real value. The Perp did a little do-it-yourself fix-up, filled in the nonfunctional swimming pool, and rented it to some serious sh!theads. The last of his tenants was a guy who abused his children so violently that the neighbors across the street sold their home to get away from the sound of the screaming. They announced — to the Perp himself as well as everyone else — that the abuse was upsetting their own children so much they could no longer live there.

SDXB was up on his roof doing some shingle repairs, when he glanced down into the guy’s backyard and noticed the sh!thead had penned two young puppies in a cage out in the glaring 100-degree sun. He reported this to the Perp, who lived next door to him at the time. SDXB announced that if he saw this again he was going to call the SPCA.

But he didn’t have to: when the neighbor across the street made his announcement that he was moving because of the child abuse, the Perp (to his credit) (I guess) told his charming tenant that if he heard one more word of any such shenanigans, he was going to report them to Child Protective Services. By dawn the following morning, tenant, wife, and bruised children were gone, disappeared into the shimmering mirages of the Cadillac desert.

Shortly thereafter, Perp sold the house to a couple who took up residence there like normal people. The wife was a kind of DIY decorator who liked to do fix-up, and they did improve the place considerably. Not enough to where it looked like a normal house, but better. Much better. Amazingly, they excavated the pool. But they never so much as touched the decrepit, feral front yard.

They divorced. The wife got custody of the house. She turned it into a rental again and moved to California. Not surprisingly, the deterioration resumed.

What a wreck it was! And it’s right at the entry into our neighborhood, so anyone who was coming to look at a house for sale in our area saw, first thing out of the box, this slum property. Needless to say, our property values did not soar into the stratosphere.

Finally, along comes the present young couple. They get the house, and the first thing they do is shovel out the gawdawful landscaping. They, as it develops, are no-nonsense gentrifiers. After several years of painting and clean-up and pool renovation and interior restoration — much of it on a DIY or barn-raising basis, the house looks pretty darned nice.

Nice, but not gaudy.

Just a few days ago, they put the house on the market. They want $429,500 for it!!!

What are they smoking?

Some Biblical weed, apparently: last August they listed it for $399,500; about two weeks later they dropped the price by 20 grand, and then they took it off the market in October.

Not, when you come down to it, the antics of someone in his right mind.

Zillow thinks my house is worth about $317,000. His is the same model as mine; he’s persuaded Zillow that it’s worth $367,241…possibly by overstating the square footage. He’s claiming it’s 167 square feet larger than mine, suggesting he’s probably counting the garage in the livable space…which is illegal. Oh well.

I imagine this spate of grandiosity is inspired by the Amazing Starburst of the fix-up around the corner.

This vintage (real!) Mid-Century Modern babe was bought by professional fix-and-flippers after the ancient old guy who lived there finally passed away. It’s huge: 5 bedrooms, and the original owners converted the garage into a gigantic TV room, thereby manufacturing 2861 square feet in which to raise their several children.

The kids grew up. The wife died. The Old Guy lived out his life in the house, deaf as a stone, with his two miniature schnauzers. They had bushy gray mustaches. He had a bushy gray mustache. Pretty adorable bunch.

The speculators ran amok in upgrading the place. It looks like they put in top-quality stuff, and the style is Late Urban Loft. It’s quite a production…

It’s a little hard-edged for my taste. They painted all the woodwork, throughout, black. But you have to allow: it’s just the thing for a young couple, straight or gay. And young couples, straight or gay, are exactly the future residents we old-timers in the ‘hood covet.

Okay, so hang onto your hat: They want $624,950 for the thing.

HOLY shee-ut! We have arrived in Richistan!

After contemplating these phenomena, I came home and looked around the Funny Farm.

Could this $317,000 shack really be worth something over 400 grand? Hmmm…

Not much has been done to it since I moved in, about 13 years ago. Compared to the Richerati Moderne around the corner, it’s beginning to look a little shabby. Needs new paint, inside and out. Its handsome cabinetry and black appliances (and its oven that dies if you dare to turn on the broiler) are…well…getting a bit dated.

But it occurs to me that with minimal painting on the inside — minimal as in even I could do it myself — the place could be made to look a lot more up-to-date.

Fortunately, my friend Elaine, who chose the paint colors for this place, had a real flair for style. The color scheme was well ahead of its time. Those fancy new houses are painted in shades of gray and pale beige. So, interestingly, is the Funny Farm. The difference is, the living room is a sort of swamp green — well, that’s what we called it. It has an accent wall in swamp blue — a kind of deep aquamarine, sort of dusky blue-green. The hallway and adjacent accent wall in the dining room is this crazy Mexican orange, something I came up with and have loved a lot, but that I do recognize is pretty idiosyncratic.

If I were to paint the swamp blue wall in the living room that soft color of green (one of these houses has a wall in a very similar color) and then paint the hallway and dining-room accent wall the very lovely ivory white (almost beige but not quite) that inhabits the dining room, the family room, and the kitchen, that would bring the interior color scheme right up to date.

There’s not a thing I can do about the kitchen and bathroom cabinets and countertops. It might not cost that much to replace the counters with granite, but new cabinetry would run upwards of $15,000 or $20,000, which I surely couldn’t afford. Probably couldn’t afford updated countertops, either.

The exterior needs a whole new paint job, and that is going to cost $4,000 or more. The paint around the slab has crumbled away — it needs to be scraped off and the cracks sealed, a certifiable bitch of a job. I’ve really liked the colors and would probably just repaint in the same shades, except for the chimney. But all of the paint has faded, and so everything, walls, trim, chimney, you name it, would have to be repainted.

Interior painting I can manage myself. Exterior: not a chance.

But four hundred thousand dollah? Seriously? That’s almost twice as much as I paid for the place.

The neighbors and I think we’re looking at another housing bubble. These prices are completely out of proportion to what the houses are: 1960s and 70s tract homes elbow-to-elbow with not one but two dangerous slums.

But one could argue that we’re looking at gentrification of yet another close-in middle-class neighborhood, movin’ on up…and turbocharged by the ultra-stylish, über-urban light-rail line. For all its impracticality and all the unlikelihood that any of them are going to use it on a regular basis, the hipsters romanticize that light-rail to a high pitch.

The historic Encanto district, where the ex- and I lived after we married, gentrified just like this shortly after we moved there, and it has never un-gentrified. The house we paid $33,000 for is on the  market, as we scribble, for $824,900.

So…anything’s possible. I guess.

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Author: funny

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8 Comments

  1. House prices are all a bunch of malarkey 🙂

    I bought a townhouse at $369k 6 years ago – 6 months ago, another unit in our complex sold for $685k – just about double the price in 6 months.

    Whether I like it or not, this is the house that I’m living in for the foreseeable future (thankfully I like it) because I can’t afford to buy anything else in the area.

    I’m just glad that i bought when I did – $369k was a ridiculous house price – $685k for a 3 bedroom townhouse/condo is freaking INSANE

    • Oh, my goodness! If that’s not irrational exuberance, I’d like to know what it is!!!

      Glad you got into a place while you could.

  2. Hmmm…As the song goes…”do I go or do I stay”….IMHO the most important thing in real estate is LOCATION. Believe it or not, done correctly that light rail will raise all the values around it. Done incorrectly…not so much. As for the neighbor who’s house is on the market again….safe to say…he’s moving…eventually. As for your situation…you have to decide…if you sell where would you go? And there are expenses in selling, moving and buying. Is it time for condo/apartment living? If so where? And what to do with the dough from the sale?
    I will suggest IF you do decide to sell paint in as neutral colors as you can as not to offend prospective buyers and this would offer them a “blank canvas” for setting up their new home. Do not spend a bunch of money on upgrades to sell. You rarely if ever get the money back.
    My situation is somewhat similar. Our neighborhood has went from “Quaint” to “Richestan” to “Crazytown”. Values are just nuts and the upwardly mobile seem to have no problem with incurring debt. Our “package” if sold would/should deliver a return of right around 7 times what we paid long ago. Aaaand being somewhat handy I could find a “fixer-upper” further out to live out our remaining years… if my knees hold up….My thought would be to perhaps have a mortgage on the “new place” at 3.5% and send the proceeds of the sale to the fine folks at TIAA-CREF and let the magic of compound interest do it’s thing. DW goes back and forth on moving. We have and continue to enjoy the place BUT the area has changed and getting worse. Getting a gallon of milk is an adventure!

  3. Yeah, I think I may neutralize the colors just because that’s what in style. Interior paint (at least) would be an inexpensive way to spiff up the place whether I live here forever or not.

    The problem with thinking in terms of what you can get for the house vs what you paid for it is that everyone ELSE can get that much more, too. What can you get, even as a fixer-upper, that would be anything you’d want to live in?

    The after-commission net on this house would buy nothing comparable in a part of town remote from blight. For $400,000 I could get a three-room apartment in Scottsdale. It would buy a very nice empty lot in Prescott. Or, actually, a nice (if bland) new build up there (http://www.zillow.com/homes/for_sale/Prescott-AZ/112342508_zpid/26620_rid/300000-400000_price/1141-1521_mp/36.520673,-110.937195,33.790561,-114.529725_rect/7_zm/4_p/).

    Actually, in Prescott more and sometimes better places are to be had in a lower price range. Here’s something small and cute with a killer view — no privacy, unfortunately, but beggar’s can’t: http://www.zillow.com/homes/for_sale/Prescott-AZ/8738885_zpid/26620_rid/200000-300000_price/760-1141_mp/36.520673,-110.937195,33.790561,-114.529725_rect/7_zm/ But…i don’t wanna live in Prescott.

    The longer I live here, the less desire I have to move. The house is extremely easy to care for, and except for the blight to the west of Conduit of Blight and the north of the canal, the neighborhood is very pleasant.

    In the call-out-the-posse-to-buy-a-bottle-of-milk department: yeah, it IS a disadvantage that you can’t use the neighborhood markets because you don’t feel safe in the parking lots. In theory I could walk to the Albertson’s and the Sprouts, but there’s no way in Hell I’d stroll around that intersection on foot. The last time I took the dogs walking along the (new, beautifully landscaped) strip the city put in along the lightrail to mollify us after they tore down a whole row of houses in our neighborhood, a weird little guy started following me. He would take up a position on the other side of the wall that (har har!) blocks noise from the light rail. From there he would stare fixedly (one might say “psychotically”) at me. Fortunately, there’s a Montessori school fronting on the strip. After I hid on the grounds for a few minutes, he went away. If he hadn’t, I would’ve had to go into the school office and call the police.

    No harm came to me…but shouldn’t you be able to walk to the corner grocery store without some creep giving you the heebie- jeebies?

    Heh heh…on the other hand, a successful trip to that Albertson’s leaves you in a celebratory mood: Whiskey for my boys and beer for my hosses!

    • Our problem isn’t “creeps”….it’s traffic….a bunch of “Barbies” in their $50K SUV’s heading to the Super Walmart and such. I imagine they set out for provisions for their $700K homes just a mile away from our “Rancho Bravo”. I swear traffic on Fridays is just unreal. And RE tax creeping up as values have headed to the heavens… Add to this the fact that we don’t need to be here….our kids are grown….we don’t need great schools or a good commute location….nor 2+ acres of grass to cut. We would be selling the house and two additional building lots WITH water hook ups which it is my understanding have significant value and are becoming rare by the day….I’ll be putting a new roof on the place in the Spring and we’ll see how I feel after that endeavor…more importantly how my knees feel…3000 square feet is nothing to sneeze at…

      • Argh, you have to mow it? Oh, dear… My ex-son-in-sin, having landed in a house with a parklike back yard that required a riding mower to maintain, once proposed to donate his backyard to the City of Scottsdale as a REAL park, so Parks & Recreation would have to mow it. 😀

        Roofing is outrageous now. I wish I’d bitten the bullet when the insurance company paid to reroof the house after the hail storm and ponied up extra to have metal shingles put on. It would have saved a ton of money in the long run…for me and for future owners.

        LOL! It sounds like you have Richerati drivers, just like we do in Scottsdale. You know…they own the road. Your duty, as a prole and a serf, is to get the hell out of their way. Peasants! Always holding up the traffic and trying to hog the decent parking spaces!!

        A Fry’s grocery store here has attempted to resolve the Competitive Parking Lot issue by installing…get this!…VALET PARKING. If they won’t quit trying to kill each other as a matter of common decency, then CHARGE the bastards to make them quit trying to kill each other.

        “Common” decency. {sniff!} How low-class!

        All of which serves to remind one that moving to Richistan has its trade-offs. At least proles, though they will jaywalk across a six-lane thoroughfare in the dark, do so only because they’re stoned, not because they think they’re your betters…

  4. Michigan house prices have recovered quite a bit from the lows of the recession. Our state law has it such that property tax raises are capped at inflation on the way up, but there’s no cap on the way down. What happened was that people who bought during the lows or whose municipalities assessed fairly saw their property tax bill go way down. Now, the values have gone up but since inflation has been low, the tax bills haven’t budged too much. People hold on to keep the bills lower (the cap is removed when the house sells), so inventory is lower…which in turn pushes prices even higher. For example our house was assessed around the original $280k we paid back in 2007 at the time. When the values fell it dropped to about $210k. Even though it’s probably worth now around $320k (according to Zillow and a couple of recent sales), we’re only paying tax on $240k. That’s saving us well over $1,500 per year.

    This system was put back into place back in the early 90’s when inflation and values were going up, and people were sick of double digit property tax values each year. So they put this cap in and raised sales tax, which at the time kept the revenue stable, but after the recession, it’s not been kind to the municipalities because the recovery on tax collections has been minimal compared to the rebound in the economy.

  5. I think Michigan property taxes are high relative to Arizona’s: (mine is now $2200). However, ours have not gone down. Our oily elected reps found a way to make it LOOK like they were giving us a break when housing values tanked:

    They lowered the assessed valuation, thereby lowering the amount we had to pay for a year or two (to great fanfare!). But (more quietly) they RAISED the tax rate. This meant that when values returned to normal, tax bills would go through the roof. Mine jumped to that $2200 from $1800, and I expect it to continue to rise as alleged values float upward.

    Every year since the Recession, the county and the city have piled on more taxes atop the inflated tax rate. The main concern I have about that is whether I’ll be able to stay in the house as taxes continue to soar — especially if Social Security is gutted and Medicare is privatized. I’m at the limit of what I can afford and still have enough in savings to support me if I live into my 80s (or, God forfend, my 90s). If taxes go very much higher, I’ll be forced out of this place and into an apartment.