I’ve had my eye on this house for a while. For one, it’s 300K price tag stands out on the MLS for a 12 bedroom / 9000 sq ft house. In addition, I found MORE PHOTOS ON THIS WEBSITE which portrays an amazing interior. Finally, I found THESE AWESOME PHOTOS depicting the home with it’s original owner in the early 20th century!
My inspection was delayed because the owner’s agent wanted to see proof of funds or a loan pre-approval letter before a showing (which seems smart to me). Anyway, it took me some time to see the inside. I was genuinely interested as a potential investment/primary res. Beside wanting to see the condition (there had to be something wrong for it’s price), I needed to know if it could be sensibly divided into a duplex and if the carriage houses could be rented any time in the near future.
The front half of the house looks the same as the website (linked above) demonstrates. Here are a few photos of the inlaid floors – not just in the public rooms, but also in four bedrooms on the second floor!
Here are the interesting – “behind the curtain” photos. The really ugly pics are from inside the carriage house(s). As you can see, they were nowhere near habitable! the bathroom pics, however, are from inside the main house. There is only one functioning shower and two functioning toilets – both on the first floor. Apparently, the current owner had started the process of remodeling the bathrooms (by removing the tubs and toilets and some walls), but then injured himself – leaving all the washrooms out of order.
By the way, the bathrooms in this home are original to when it was built. What I’m getting at is, the sinks and tubs are in separate rooms from the toilets because when they built these homes it was considered unsanitary to have the tub in the same room as the toilet. That would require some creative updating…
In the end I had to pass – with a big “no thank you”. To me the two glaring issues are the bathrooms and the fact that one of the carriage houses needs to be stripped back to a shell and rebuilt. This house has been in foreclosure for two years already. In this day in age, that could be the result of a back log of paperwork, or maybe missing paperwork (leaving the bank without authority to take the house back). If it’s the latter, this owner may be living rent free for a long time to come!
Imagine being shot in the knee caps — it would probably slow you down for a while. Well, the housing “recovery” has potentially lost its legs.
A court ruling from Massachusetts’ highest court determined that Wells Fargo and U.S. Bancorp lacked the authority to foreclose on two specific homes because they “failed to make the required showing that they were the holders of the mortgages at the time of foreclosure”, wrote Justice Ralph Gants. The ruling also states that other homeowners that can prove they were foreclosed on without proper authority can seek compensation retroactively. Now the banks will have to backtrack.
Don’t get me wrong – I’m not advocating that banks foreclose without authority. I’m not even accusing the courts of “crippling” the recovery. It appears the banks hurt themselves. As usual, their sloppiness affects the market. This issue has decidedly slowed the banks from unloading these non-performing assets. Some mortgage service providers had already stopped seizing houses in late 2010 due to a wave of similar lawsuits. In addition, all 50 state attorneys general are examining whether lenders are foreclosing improperly. As a result, the entire process will be dragged out, keeping prices down for a longer period of time.
Expect the news to report that “foreclosures are down”… now you know why!
Related articles:
Banks lose important ruling on foreclosures – MSNBC.com
Faulty paperwork slows foreclosure activity, survey shows -MSNBC.com
Banks Hit Hurdle to Foreclosures – Wall Street Journal (June 1st, 2011)
This does not look like a “mansion” that I would like to live in (unless my other option was a cave). Besides a third world aesthetic, it has no internet access or garbage pick-up. However, it does have a nice perimeter wall!
According to this RISmedia.com article, new home buyer’s are shunning houses that need repair. As opposed to five years ago, when buyers overlooked repair issues because they new real estate prices were climbing quickly and time was of the essence.
So, obviously this makes sense. The point of the article was for sellers to make an extra effort to improve their property and it’s appearance in order to have a chance in this market. However, between the lines, I read: keep making really low offers to buy houses that need repair… cuz there’ not a flood of buyers looking for a “project”, especially when there’ so many houses available to choose from!
I’ve seen the occasional article online that gives the impression that it’s a highly competitive market – that cash buyer’s are stealing the deals. But the reality that I see is that there are far more houses for sale than buyers, and there is still a plethora of opportunity and bargains. To me, if it costs more to rent than to buy, it’s a deal.
Relevant books on Amazon.com:
1.) Investing in Real Estate
2.) Home Buying For Dummies, 4th Edition
As reported in this CNN article, ”One in four renters — or about 10.1 million households — spend half their paychecks on rent and utilities, the study (by Harvard Joint Center for Housing Studies) found.”
This validates the concept that now is a good time to buy real estate. There’s a glut of houses for sale who’s purchase price is low enough to allow monthly rental income over-and-above the cost of a mortgage.
If you think real estate is cheap in dollars, consider how many gallons of gas a house costs today, or ounces of gold? You can probably buy a house in your area for fewer gallons of gas than you could in several decades. In other words, the dollar is worth less than it has been in a long time and compared to other commodities, real estate is even cheaper than now than the dollar signs suggest! And it’s inevitable that real estate values will be even greater over the next two years (or more) when measured by commodities.
Related Books On Amazon.com:
1.) Rich Dad’s Advisors: Guide to Investing In Gold and Silver
2.) Crash Proof 2.0: How to Profit From the Economic Collapse
Related books on Amazon.com:
(1.) Flipping Houses For Dummies
(2.) The Complete Guide to Flipping Properties
See more photos on our Flickr site.
This blog is produced by The Louisville Homebuyer.
Investor Takeaway: with current prices and interest rates low, buy NOW and rent for cashflow
Agent/Seller Takeaway: be nice to investors
The National Association of REALTORS® published information from a survey for the REALTORS® Confidence Index revealing that foreclosures represented 37 percent of sales in January and all-cash transactions accounted for 32 percent of home sales. The percent of all-cash transactions doubled from two years ago.
One likely reason that the percentage of all-cash purchases increased is tougher lending standards. In other words, potential buyers without all-cash are having a harder time borrowing money. Lenders are requiring higher credit scores and larger down payments. A recent Zillow.com survey explained that the median down payment rose to 22 percent last year in at least nine major U.S. cities.
Another factor contributing to the equation(s) is buyer confidence and buyer motivation. Homebuyers shopping for their primary residences are less likely to have the time and flexibility required to engage in a short sale transaction and they generally avert risk. Foreclosures and bank-owned properties are sold as-is; “Buyer beware” is the credo in this market niche. If a homebuyer chooses to buy a house that is not distressed, then they should be concerned about losing value in the near future. Investors, on the other hand, are generally happy to buy distressed property and accept the associated risks in exchange for steeper discounts.
Related book on Amazon.com:
(1.) Real Estate Ownership, Investment and Due Diligence 101: A Smarter Way to Buy Real Estate (Volume 1)
This blog is produced by The Louisville Homebuyer
