Funny about Money

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

Sold! Real estate returns to normal in our neighborhood

Incredibly, the rental house across the street, occupied of late by the obnoxious Biker Boob and Bobbie McGee, sold for $250,000. That’s dead center in the ball park of what houses were worth here before prices got stupid.

I was afraid it would be bought by yet another absentee landlord. But at that price, it’s unlikely they can rent it for enough to cover the mortgage—rental prices are still very depressed here.

Better yet, they’ve plopped a big dumpster in the driveway and sent workmen in there to gut out the interior! It looks like they’re rebuilding the kitchen—a decrepit dishwasher is sitting in the driveway waiting to be hauled off, and carpenter-like guys have been swarming over the place for the past two weeks.

So. This is a good sign. That’s twenty grand more than I paid for my house, and it’s about twenty-one thousand more than SDXB got for the same model. He sold way too low—the house was grabbed up  less than 24  hours after he put it on the market. So I’d estimate the price is about where it should be for that model.

Now…if we would just, please, see the same thing happen in the neighborhood where the downtown house resides…  We’re $75,000 underwater there, according to the ever-heartbreaking Zillow. But that’s because everything that’s sold there over the past three years or so has been a foreclosure, with the exception of one house that sold at a fire-sale price. Once all the foreclosures are cleared out, maybe values will begin to return to normal in that area, too.

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7 Comments

  1. That is such good news. As is the suit against Goldman Sachs.

  2. @ frugalscholar: Yeah. What a mess the Goldman Sachs thing is. Jeez, what overweening greed those people must have felt. How could you succumb on such a grand level?

  3. I’m going to try not to start twitching at the Goldman Sachs mention and stick to the real estate market.

    It’s great that some normal sales are going through. Real estate is very weird these days. It’s also odd that here in France, you just don’t see foreclosure signs. They never went through the bubble here to the extent we did in the US–tighter lending practices. . .That government regulation everyone was cursing (even in France) at the time.

  4. Re Simple’s comment–the dreaded NOTAIRE makes sure everyone understands whatever contracts are under consideration. Can you imagine the notaire explaining that even though you make $30,000/yr, you can get a 5/1 ARM on a $300,000 house, which you will be able to refinance in 5 years when the house appreciates in value. And while you are at it, you can take appreciation money out to pay college tuition, buy a new car, and that Louis Vuitton bag you’ve had your eye on.

  5. “prices will return to normal” : That would only someone say who is a real gold digger, i assume you are.

    Oh i bough the house for 120k and in 5 years it went up to 290k , now its down to 220k ! cry cry, people like you made housing unaffordable, of course you and the state and fed’s. Who doesnt want higher values, the state gets a higher tax , sure why not, just kill the “normal” middle class by jacking up the prices so you can get only a shak for 500k here in L.A.

    You know what, i like the rezzecion, i like then everyones value went down, i like to see all those people going out and have to rent a 2 BD with 800square feet for 1400$ , you get what you deserve, Americans are greedy and that will bite back, you saw it already with the reccecion but thats not the end, there is more to come and once all of our precious Industry is destroyed the rest will wake up and take another road that will might lead to prosperity, but not like this.

    So yeah, its good the prices went down and they will drop even more once the Fed’s unemployement runs out and the next batch of foreclosures comes in.

    • @ Takis: You need to get a dictionary and look up “gold digger.” I assure you, my dear, I’m not interested in marrying men for their money. I am interested in not losing my shirt on my investment in my house, just as I’m interested in not losing the equally hard-earned money in my retirement savings. What could kill the middle class faster than what’s happened to my son and me, where a house purchased at what appeared to be a deep discount is not tens of thousands of dollars underwater? If housing prices to do not return to the level they were at before the bubble began, there will be no middle class in this country. In fact, IMHO, the middle class is already fast disappearing, ushered out on a wave of bad economic policy and bird-brained political thinking.

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