March 30, 2010

Short sale in San Mateo, with great opportunity

Beds: 2
Baths: 1
Sq. Ft.: 720
$/Sq. Ft.: $542
Lot Size: 4,365 Sq. Ft.
Property Type: Detached Single Family
Style: Ranch
Stories: 1
View: Neighborhood
Year Built: 1940
Community: Bowie Estate
County: San Mateo
MLS#: 81001423
Source: MLSListings
Status: Active This listing is for sale and the sellers are accepting offers.
On Redfin: 62 days
Short Sale (subject to lenders approval) 2bd 1ba 1 car garage, spacious back yard . .. Plenty of potential

Short sales can sometimes be amazing opportunities to get amazing value. I mean, heck, this house even has two fine german cars parked in front of it. That’s a sure sign of potential success that you may achieve if you purchase this house!

So, let’s take a look at this spacious back yard! Uh… oh… what’s going on here?

image

What? No mention of “great for first time buyers/handyman’s delight”? I feel so misled by this listing!

Comments (219) -- Posted by: burbed @ 5:38 am

219 Responses to “Short sale in San Mateo, with great opportunity”

  1. SEA Says:

    720 sq feet, and it appears that the green room is located above what looks like a garage. Such a lovely back yard. All this for less than $400k? Unbelievable.

  2. AstroWallaby Says:

    That gigantic slab of bacon in the green room has got to be worth a couple hundred grand just by itself.

  3. Petsmart groomer Says:

    Redfin’s Short Sale Policy:

    Despite their unpredictable nature, short sales are becoming an increasingly common part of the real estate landscape, and represent an attractive option for many Redfin customers. In order to give our customers the best possible service, we’ve begun offering tours of short sale properties in selected areas. Customers who want to make an offer after touring one of these short sale properties will be referred to a partner agent who specializes in short sale purchases.

    We currently tour short sale properties in the following areas:
    * Seattle
    * San Francisco/Bay Area
    * Atlanta
    * Phoenix
    * Portland
    * Sacramento
    * Los Angeles

  4. SEA Says:

    Sorry, but I am sure the bacon isn’t part of the sale. You might, however, locate the missing skylight in the backyard. Who knows, probably the seller wants to keep the skylight with the bacon. Do you really expect extras like that for less than $400k? Seriously.

  5. Petsmart groomer Says:

    If the BMW and Mercedes outside belong to the owners, they should review their priorities in life…

  6. nomadic Says:

    If the BMW and Mercedes outside belong to the owners, they should review their priorities in life…

    Spoilsport. When you live in the Real Gray Area, aren’t residents “entitled” to German engineering? Particularly when the taxpayers will pick up the tab? (WaMu was the lender.)

    There aren’t many details available on this property, but it looks like the current squatter/owners sucked about $200k of ekwity out of this puppy in 2003.

  7. nomadic Says:

    Last week there was some discussion on here about economic growth in China, and our helper was advocating going long on the yuan. I didn’t get around to reading this article, which discusses concerns about the local governments defaulting on $450 billion in loans (30% of total lending in 2009) used to drive infrastructure development:

    http://seekingalpha.com/article/192795-signs-of-a-china-credit-and-real-asset-bubble-are-now-unmistakable

    The risks that China faces today (and the US in the late 1920s and Japan in the late 1980s) is of excessive domestic liquidity having fueled asset and capacity bubbles, the latter requiring the uninterrupted ability of foreign countries to absorb via large and growing trade deficits. These risks include an explosion in domestic government debt directly and contingently through the banking system.

  8. nomadic Says:

    meant to say “I didn’t get around to POSTING this article…”

  9. anon Says:

    The “owner” of this house reeks of success. I know because I can see their cars. While a BMW or a Mercedes is not the best car money can buy, you can tell conclusively determine these people are in the same social class as, say, real estater.

  10. Pralay Says:

    There is no pickup truck on driveway. The owner belongs to high “social class”.

  11. bob Says:

    Nomadic,
    From what I gather China currently has a housing boom that makes ours look like nothing. We’re talking home price inflation that makes that of the Bay Area’s during the boom seem like a whimper. We’ll see how that turns out for them.

  12. anon Says:

    It will create a whole generation of debt slaves. Just like it did here.

  13. Pralay Says:

    Debt = wealth. Our “helper” said. Bigger the debt, bigger the tax break.

    Hamster in debt wealth wheel.

  14. SEA Says:

    “Debt = wealth,” until one must pay it back…

    Look how wealthy the United States is!

  15. Real Estater Says:

    >>Debt = wealth.

    There’s good debt and there’s bad debt. Borrowing money to buy a car is considered bad debt; taking on a mortgage to buy a house is good debt. A financially savvy person would carry only good debt and minimize bad debt.

  16. Real Estater Says:

    Here’s a one way to make money from the upcoming appreciation of the Yuan:

    http://www.eastwestbank.com/English/IB_CRLCD.asp

  17. Real Estater Says:

    Good news #1:

    A surprisingly strong rebound in California’s real estate market helped lift a key home price index for the eighth month in a row.

    Good news #2:

    Pace of house flipping picks up

  18. SEA Says:

    Real Estater-”taking on a mortgage to buy a house is good debt.”

    Tell that to all those who are living in an underwater home.

  19. Petsmart groomer Says:

    > Tell that to all those who are living in an underwater home.

    You don’t understand. If you keep paying your mortgage diligently, you will always reach a point when you have positive equity! :-)

  20. SEA Says:

    Petsmart groomer-

    Pay all those payments, and what do you have? A hope that you’re not short. And that’s not even counting the negative amortization/interest only loans.

  21. Real Estater Says:

    Let me say it again – as long as you pay your mortgage, being underwater doesn’t matter. In 5 years majority of underwater folks will recover fully. Even when people buy a car, they expect to drive it for 5 years.

  22. Pralay Says:

    Good news #1:

    A surprisingly strong rebound in California’s real estate market helped lift a key home price index for the eighth month in a row.
    ——

    What is that “key home price index”? You mean “Crap-Shitter index”? I didn’t know Faux Estater is a fan of such an index! Here the moment of truth: Crap-Shitter index is utterly useless facts, especially for anyone shopping RBA..

  23. Pralay Says:

    In 5 years majority of underwater folks will recover fully.
    —–

    So guys, don’t be a minority. It’s not a choice.

  24. Pralay Says:

    More about Crap-Shitter Index in the SF Chronicle article:

    Many analysts expect the Case-Shiller 20-city index will again turn downward in the coming months as more foreclosures in other states hit the market.

    “It is only a matter of time before the index records a double-dip in prices,” wrote Paul Dales, U.S. economist with Capital Economics, who forecasts a 5 percent drop. The market will be tested in the second half of the year, he wrote, when a tax credit that has boosted sales is gone.

  25. Real Estater Says:

    Why does it matter to you Pralay? You’re not even looking at houses, right?

  26. SEA Says:

    “In 5 years majority of underwater folks will recover fully.”

    There is a line of people who have owned for the last five years who’d love to sell at their 2005 purchase price.

  27. McFly Says:

    “Let me say it again – as long as you pay your mortgage, being underwater doesn’t matter.”

    Save your breath. No need to repeat yourself, everybody laughed their ass of the first time.

  28. Pralay Says:

    Why does it matter to you Pralay?
    —–

    It’s perfect OK to be agitated. However I take no responsibility for making you agitated. I just quoted your past comments. I am merely a messenger. :)

  29. SEA Says:

    I love this attitude that you don’t need to worry that your home has lost tens of thousands of dollars in value. Just keep making the payment, what does it matter that you won’t have any cash to fix the roof?

  30. Real Realtard Says:

    Yep, nothing like eating your down payment, wasting thousands a month on a mortgage, and being stuck in your home. Sounds like a great investment to me.

  31. nomadic Says:

    “Let me say it again – as long as you pay your mortgage, being underwater doesn’t matter.”

    Save your breath. No need to repeat yourself, everybody laughed their ass of the first time.

    It’s kind of like Jay Leno. Not funny after he repeats a punchline a few times to try to milk another laugh out of it. (Except in Jay’s case, it’s often not funny the first time either.)

  32. nomadic Says:

    “In 5 years majority of underwater folks will recover fully.”

    Warren Buffet on good investing: “The first rule is not to lose. The second rule is not to forget the first rule.”

  33. Real Estater Says:

    It’s a familiar pattern here. People laugh at first, then they realize how wrong they are. This is exactly the cycle that helps to build my credibility. Once in a while someone will admit that they agree with me, because I’ve been right all along.

    The person who challenges me the most (we all know who this rentard is) is also the guy who is wrong the most often.

  34. Real Estater Says:

    The first rule in real estate is that it’s a long term investment. The second rule is to not forget the first rule.

  35. anon Says:

    The first rule in reading burbed is to not take real estater seriously. The second rule is to laugh at him.

  36. Pralay Says:

    This is exactly the cycle that helps to build my credibility.
    —–

    Aha, Faux Estater is in the mode of building his credibility again. :)

  37. Pralay Says:

    People laugh at first, then they realize how wrong they are.
    —–

    First part (laugh) is true. We laugh at Faux Estater…a lot, A LOT.
    Second part is false.

  38. anon Says:

    Maybe a couple more wrong predictions and some obvious ineptitude will do the trick.

  39. SEA Says:

    Thanks for the laughs! (I guess this just helps build Real Estater’s credibility? I’m still laughing!)

  40. Real Estater Says:

    Let’s check the record:

    - After all this time, Madhaus’ shack is still worth $1M
    - When DOW was at 6500, I said it’s a no-brainer to buy.
    - House on Ramona St. was flipped for $1M gain. The unbelievers are stunned.
    - Home prices and sales on strong rebound (as widely reported)
    - Inventory is low and keeps dropping

  41. Pralay Says:

    Ok, let’s make some wrong predictions to prove Faux Estater correct. Here I am making three.

    Prediction 1: There is indeed no recession. We’re all clear for take-off.

    Prediction 2: When the rebound occurs – it’ll be very sudden and furious as buyers cave in after a period of low inventory, slow sales and flat prices.

    Prediction 3: Unemployment is on the way down, not up.

  42. SEA Says:

    Why do I keep hearing about short-sales, foreclosures, bank failures, more housing bailouts, including California Tax credits… The list goes on. All for the suckers and fools, I am sure.

  43. Real Estater Says:

    SEA,

    You’re fairly new. We’ve gone down this road many times before.

  44. SEA Says:

    So far down the road, and nothing’s changed?

  45. Real Estater Says:

    Pralay is like a broken record. Repeating the same mis-conceptions to newcomers. Don’t be fooled by the rentard.

    >>Prediction 1: There is indeed no recession. We’re all clear for take-off.

    Clearly responded to here.

    >>Prediction 2: When the rebound occurs – it’ll be very sudden and furious as buyers cave in after a period of low inventory, slow sales and flat prices.

    That’s exactly what has happened. Price shot up 21%, and inventory is dropping. Read this in any newspaper.

    >>Prediction 3: Unemployment is on the way down, not up.

    Absolutely. There’s a significant up-tick in the job market right now. In certain areas related to the government stimulus, there is already a feeding frenzy. If you’re not aware of it, you are missing out, but it won’t be long before it becomes widely known.

  46. Pralay Says:

    When DOW was at 6500, I said it’s a no-brainer to buy.
    ——–

    LOL! Even a broken clock right twice a day. October 13th, 2008 – DOW 8500+. “Stock market is staging a strong recovery”.

    Basically everytime DOW drops, Faux Estater says “Time to buy. I just bought”. Now he does not mention his DOW 8500 purchase anymore (and any other purchase for that matter). He only mentions 6500. Isn’t that cute? :)

  47. SEA Says:

    Real Estater- On September 9, 2008 (well over a year ago), you suggested, “…the Fannie Mae/Freddie Mac problem just got solved today.”

    You have to admit that was wrong.

  48. Pralay Says:

    You have to admit that was wrong.
    —–

    No, no, no. He cannot be wrong. :)

  49. Pralay Says:

    >>Prediction 1: There is indeed no recession. We’re all clear for take-off.

    Clearly responded to here.
    —-

    Translation: I tried to RE-explain in convoluted fashion. Gosh, backfitting past words is always tough.

  50. SEA Says:

    This place is like crack. I should be sleeping, but instead I am reading this board.

  51. Pralay Says:

    That’s exactly what has happened. Price shot up 21%, and inventory is dropping. Read this in any newspaper.
    —-

    Useless aggregate data. Probably rolled up Palo Alto and East Palo Alto into one number.

  52. Pralay Says:

    Price shot up 21%, and inventory is dropping.
    —–

    I don’t see what’s with all the clamor around inventory. Inventory by itself is useless aggregate data..

  53. SEA Says:

    Pralay- “No, no, no. He cannot be wrong.”

    Correction: He cannot admit he’s wrong.

  54. Real Estater Says:

    >>Now he does not mention his DOW 8500 purchase anymore

    Did you check where is the DOW today? My recommendations came in 3 categories:

    - Right
    - Quite right
    - Extremely right

  55. Pralay Says:

    There’s a significant up-tick in the job market right now. In certain areas related to the government stimulus, there is already a feeding frenzy.
    —-

    Yes, I can see an uptick. Aug 2009 (when Faux Estater made the prediction) unemployment rate: 9.6%. Now 10.4%.

  56. Real Estater Says:

    Fannie Mae/Freddie Mac problem is not a problem. All you care about is historically low interest rates.

  57. SEA Says:

    “All you care about is historically low interest rates.”

    Why did prices go down?

  58. Real Estater Says:

    >>Yes, I can see an uptick. Aug 2009 (when Faux Estater made the prediction) unemployment rate: 9.6%. Now 10.4%.

    Unemployment among the wealthy is at 3%. Unemployment among the not-stupid is way less than 10%. If you have education, experience, and the right skills, the job market is literally booming like it’s 1999.

  59. Pralay Says:

    My recommendations came in 3 categories:

    - Right
    - Quite right
    - Extremely right

    ——

    Time in a broken clock can be described this way:

    Actual time 1 AM. Broken block shows 3 AM. Verdict: Right

    After one hour, actual time 2AM, broken clock shows 3AM. Verdict: Quite right

    After two hours, actual time 3AM, broken clock shows 3AM. Verdict: Extremely right :)

  60. Real Estater Says:

    >>Why did prices go down?

    It’s a tale of 2 markets. Prices are down in crap places, like where Bob lives. Prices in good areas like 94087 have not gone down.

  61. SEA Says:

    Are entire states, like Nevada and Florida, crap places?

  62. Real Estater Says:

    >>Time in a broken clock can be described this way

    That’s one way to look at it (the stupid way, in my opinion). First you missed an opportunity, then you missed a greater opportunity. Finally, you missed the opportunity of a lifetime. That’s why you’re still renting.

  63. Real Estater Says:

    >>Are entire states, like Nevada and Florida, crap places?

    All “fly-over” states are crap. Other places may not be crap, but they’re not Special either.

  64. SEA Says:

    So 94087 is the only “special” place in the US?

  65. Pralay Says:

    Unemployment among the wealthy is at 3%.
    —–

    Anon replied it best: Unemployment amongst the employed is also 0%…

    No wonder people laugh at Faux Estater.

  66. Pralay Says:

    the job market is literally booming like it’s 1999.
    —–

    We trust Faux Estater. Job market is literally booming like 1999.

  67. Pralay Says:

    That’s one way to look at it ….That’s why you’re still renting.
    —-

    Still agitated?

  68. Pralay Says:

    Fannie Mae/Freddie Mac problem is not a problem.
    —-

    No problem is problem. Underwater is not a problem. Fannie Mae/Freddie Mac problem is not a problem.

    The only problem is some people are not buying homes to prop up Faux Estater’s home value.

  69. Real Estater Says:

    >>Still agitated?

    Why should I be agitated? You’re one without a house :-)

  70. Pralay Says:

    Why should I be agitated?
    —-

    Great! So we can make fun of you little bit more. :)

  71. Pralay Says:

    As an effort to make fun of Faux Estater, I am giving link to a very old post – Faux Estater’s “Special” RBA. Not a “fly-over” land.

  72. Real Estater Says:

    And of course, don’t forget to read the follow-up to that post.

  73. Real Estater Says:

    Pralay,

    Can you last til 3AM today? I got conf call with India, and don’t mind sticking around.

  74. Pralay Says:

    One more fun-making.

    Tax day is coming. I am pretty sure Faux Estater will be in AMT trouble again.

    Those who forgot last year’s hilarious AMT tax problem, here the link. Poor Obama. He got the blame before he passed his first six months in White House. The whole thread is hilarious. A Lewis tried to explain why Faux Estater’s problem (actually made-up) is not a problem, but Faux Estater still insisted that his AMT problem is real problem.

    Guys, are you ready for this year’s AMT problem?

  75. Real Estater Says:

    Put it simply, the people who don’t have AMT problems have problem making money. Just a different problem.

  76. Pralay Says:

    I got conf call with India, and don’t mind sticking around.
    —–

    One more lie. Or someone’s head needs to checked.

    FYI, 9PM in California is 9-30AM in India (that means people are already in office in India and can do conference).

    6AM in California is 6-30PM in India (convenient for both sides to do conference call).

    A person who needs to stay up till 2AM or 3AM to make conference call to India simply does not how things work. But we all know how Faux Estater’s fictitious multi-million dollar mega-project works. :)

  77. DreamT Says:

    #73 – This one or this one?? I don’t suppose you mean this one.

  78. Real Estater Says:

    >>A person who needs to stay up till 2AM or 3AM to make conference call to India simply does not how things work.

    Gee, I guess you know the schedule of my group better than myself. Should I hire you to be the secretary?

  79. Pralay Says:

    Put it simply, the people who don’t have AMT problems have problem making money.
    —-

    Someone who needs to stay up till 3AM to make conference call (although it is pretty obvious it is not true) to buy insurance or earn frequent flier miles got to be earning lots of money. :)

  80. Pralay Says:

    Should I hire you to be the secretary?
    —-

    No, you need to hire someone who can check your head. Or you need to join Liar Anonymous.

  81. Real Estater Says:

    That’s right. Work hard, play hard, follow-the-sun, make money, live in RBA, and see the world! Sure beats staying up til 3AM to write zero value comments.

  82. Pralay Says:

    Gee, I guess you know the schedule of my group better than myself.
    —-

    LOL! A manager schedules conference call (in a time agreed by both sides). “Schedule of my group” is irrelevant.

  83. Real Estater Says:

    Pralay,

    I advise you to drop off now. You won’t be able to write code tomorrow.

  84. Real Estater Says:

    >>A manager schedules conference call (in a time agreed by both sides). “Schedule of my group” is irrelevant.

    This is the mutually agreed schedule!

  85. Pralay Says:

    This is the mutually agreed schedule!
    —-

    So which is true?
    1. Faux Estater’s head needs to be checked because he agrees to schedule conference at 3AM.
    2. There is no such is as “multi-million dollar mega project”.
    3. Faux Estater talks to first link provided in post #77, while his trophy wife is snoring.

    I opt for #2.

  86. Pralay Says:

    Correction on #85: There is no such thing called “multi-million dollar mega project”.

  87. anon Says:

    “Sure beats staying up til 3AM to write zero value comments.”

    *cough* Real estater – this is exactly what you do…

  88. nomadic Says:

    Another Buffet gem:

    ‘You do not adequately protect yourself by being half awake when others are sleeping.’

  89. Pralay Says:

    My favorite comments from Faux Estater regarding AMT:

    The people who don’t have AMT problems have problem making money..

    This one is hilarious:

    Only wish they’re smart enough to actually have a tax problem!

    If you don’t have tax problem, you are not smart enough.

  90. nomadic Says:

    If you don’t have tax problem, you are not smart enough.

    Ironically, math is hard for those who are “smart enough” in RE’s world. Or maybe it’s the lack of reading comprehension when perusing the tax code.

  91. SEA Says:

    nomadic-

    Remember we are the ones who don’t understand–just ask Real Estater.

  92. nomadic Says:

    Ah yes, SEA, we are but lowly amateurs…

  93. SEA Says:

    I especially like how he ignores so many questions, but defends his position on others so heavily. I am still wondering if 94087 is the only “special” place in the US.

  94. bob Says:

    RE,
    You keep trying to allude to an era that is long-gone. I’m sure you imagine things are any day now going to become all nice-n-bubbly in the Bay Area just like it was in the dot-com and housing boom.

    First of all, unemployment in the tech sector is the highest its been in more than a decade. I personally know at least 5 people who are currently unemployed and worked in tech. That unemployment is high in the industry is obvious.

    But what isn’t as obvious is the trend the tech biz is taking these days. For one more and more companies hire people as contractors rather than employees. Secondly the average wage has fallen. Additionally there is more reliance on overseas labor, which tends to cost a lot less. Lastly as mentioned in the article posted by “SS” in the previous post many in tech these days area heading to Huntsville, Austin, Cary, and other cities with generally lower costs of living. This trend is accelerating as shown by the charts previously mentioned by the Mint.com article. 670,000 left Cali alone last year.

    None of this really bodes well for future spectacular housing price inflation in SV. Lower wages, higher unemployment, more overseas labor, and the fleeing of future talent all indicates negative forces on SV area housing prices.

    It also brings up my last point which is more of my own opinion but one I imagine many others share. If you buy a house- especially one that requires you to have a very good salary to pay for it- then it generally helps to have a stable job that can be counted on. Those kinds of jobs are disappearing in the tech industry. In order for people to feel comfortable buying expensive homes they must have confidence in their jobs. Much of that confidence is being eroded by the changes and practices in the industry. This is one of the reasons along with the general high cost of homes that has me moving out simply because I simply cannot trust that any job I have in tech will ever be secure given my own experience and that of many of my friends.The high cost of housing simply makes buying one with a shaky job situation too risky. In a cheaper city you can afford to lose jobs here and there and still make the payments. Better yet for me I can just buy the house and not have that liability period.

  95. Pralay Says:

    I especially like how he ignores so many questions..
    —–

    I know you guys are on the low end of the spectrum and don’t understand anything – neither AMT problem, nor conference call scheduling with India.

    Just remember that Faux Estater explained everything in past. Didn’t he already say the same thing in #43?

  96. SEA Says:

    I guess what he expects is for us all to tell him how wonderful zip area 94087 is. All homes in that zip are perfect. It’s a sure bet. Bad people buy homes in bad areas.

    Let’s consider today’s listing–

    $390,000 at 5% = $19,500.

    Now I certainly understand that everyone in the Bay Area makes the big bucks, but please allow me to suggest that an interest only loan’s interest of $19,500 is more than what a minimum wage worker makes in a year. I know, I know, paying all that interest adds value to the home, and that’s not to mention taxes. Even if one made about $100k or $200k, then 20% or 10% of gross income would go to interest alone, respectively.

    What a wonderful life!

    What happened to the days when saving money meant spending less than income?

    Oh, and when interest rates go up, that only means that someone would have to spend even more on interest, right?

  97. SEA Says:

    For what it’s worth, $500 per square foot at 5% interest is $25 interest per square foot*year. $800 per square foot at 5% is $40 interest per square foot*year.

    A 10′ x 10′ spare room? At $500 per foot, that’s “only” an extra $2,500 per year in interest. At $800, it’s an extra $4,000 per year in interest–that only $335 per month (over a week’s wages at minimum wage, and that’s just for the 10×10 room).

    The place above is $542 per square foot, or $27.10 interest per square foot*year.

    Please remind me why people complain about housing prices.

  98. nomadic Says:

    SEA, let me bring you up to speed on zip codes. The most revered is the one in which RE claims to live: 94301. It’s the pinnacle of home ownership, the one that brings respect from peers and is a “destination” zip. ROTFL, excuse me while I stifle the laughs…

    As for your precision calculations, surely you’re over-thinking this. Just feel the pulse of the market and go for it! :-D

  99. SEA Says:

    nomadic-

    I know I’m watching a different news feed than the rest, but let me consider this claim by our friend:

    “Some of you seem to focus an extroardinary amount of energy on all kinds of calculations, while the rest of us simply enjoy living in our house, and watch the equities accumulate over time.”

    That’s fine and well, but considering the news I see is foreclosures, job problems, and so on, I am not sure how one enjoys a home when the mortgage payments are not being made. Oh, that’s right, it’s only in the bad areas to bad people. Thanks for the reminder.

    I know I shouldn’t even do this, but…

    FannieMae serious delinquency rates are up to 5.52% (January 2010). That’s approximately double from 2.77% in January 2009.

    http://www.fanniemae.com/ir/pdf/monthly/2010/022810.pdf

    5.52% is about 1 in every 18.

    Any recovery better start helping these people and quick!

    Do you really think these delinquent owners, many of which are trying to sell short, are actually enjoying their fine properties?

    I’m enjoying the sunset tonight.

  100. Amateur Says:

    —-
    I guess what he expects is for us all to tell him how wonderful zip area 94087 is. All homes in that zip are perfect. It’s a sure bet.
    —–

    Well, 94087 is part of RBA. Is there any doubt that RBA is just like Disneyland – the happiest place on Earth? I know “usual suspects” have doubts, but let me tell you that Faux Estater has real track record of telling the truth.

  101. Petsmart groomer Says:

    > $500 per square foot at 5% interest is [...]

    I get your point, but remember you pay less and less interest with time (assuming you don’t get a 30-year interest-only loan). After 10 years, you’ll pay $20 interest per square foot and after 20 years it will be about $12.

  102. Real Estater Says:

    A lot of random things are being talked about here. Let me respond to a few:

    - At 5% interest rate, plus tax deductions, one ends up paying only around 3% rate. That’s a tremendous deal.
    - It is true that home ownership is generally not for people who can’t hold a steady job or don’t pull in sufficient income. On the whole home owners are a more successful group of people than renters. That’s not a secret.
    - When you say delinquency rates are at 5.52%, that’s like saying the glass is 5.52% empty instead of looking at it as nearly full. The vast majority of the people are not delinquent.

  103. Pralay Says:

    - When you say delinquency rates are at 5.52%, that’s like saying the glass is 5.52% empty instead of looking at it as nearly full. The vast majority of the people are not delinquent.
    —–

    SEA,
    When you discuss with Faux Estater, you must ignore his comprehension problem. He does not understand the difference between total delinquency and delinquency rate.

  104. SEA Says:

    “but remember you pay less and less interest with time (assuming you don’t get a 30-year interest-only loan).”

    Let’s allow opportunity cost to equal interest, so the cost of the principal is exactly the same as the interest, so now we can just run all the computations as if the loan is interest only. There might be a small difference in cash flow, but it’s probably not enough to worry about.

    So under a standard amortization, the opportunity cost of the capital starts low directly related to the interest which starts high and goes low.

    Opportunity cost + interest = $X, where X is constant over the life of the loan, assuming discount rates do not change.

  105. Real Estater Says:

    Did you think about the “opportunity expense”? If you don’t buy a house, you still need to rent one, without getting any tax deduction.

  106. SEA Says:

    “At 5% interest rate, plus tax deductions, one ends up paying only around 3% rate. That’s a tremendous deal.”

    That’s 5% net of all tax benefit. If you want to go pre-tax, that’s fine. Let me suggest that 3% is a terrible deal if the appreciation rate (or discount rate) is less than 3% (negative leverage).

    Compared to 20%, 3% is a bargain, but compared to what banks pay in interest on savings (again, net of taxation), 3% is expensive.

  107. nomadic Says:

    #102 is like pulling the string in the back of a kid’s doll and having it parrot a few key phrases…

  108. SEA Says:

    “Did you think about the “opportunity expense”? If you don’t buy a house, you still need to rent one, without getting any tax deduction.”

    What’s the current annual cost to rent versus purchase price?

  109. Real Estater Says:

    >>Compared to 20%, 3% is a bargain, but compared to what banks pay in interest on savings (again, net of taxation), 3% is expensive.

    If you go talk with a financial planner, a typical target for investing is 6% / year. I don’t use any professional help, and I make more than that with my 401K money.

    3% is like free money by comparison. Banks are not currently paying much interest in savings accounts, but when interest rate goes back to trend, you can easily make 3%.

  110. SEA Says:

    Also, this point should not be inserted so lightly:

    “…you still need to rent one, without getting any tax deduction.”

    Specifically let’s concentrate on:

    “…without getting any tax deduction.”

    You tell me, which situation takes greatest advantage of the tax code:

    1. You own your own home, and I own my own home.
    2. I own your home and rent it to you, and you own my home and rent it to me.

    For simplicity, let’s assume equal income, equal values of the homes, equal taxes, equal insurance, so we are only discussing the difference in taxation.

    If #2 has better tax benefit, let’s discuss how it’s divided.

  111. Real Estater Says:

    >>What’s the current annual cost to rent versus purchase price?

    Don’t be distracted by the current. Look at the big picture.

    Initially rent costs less than mortgage payment. Overtime, rent will rise and eventually exceed mortgage payment.

    Currently banks are paying 1% on savings. When things go back to trend (as they always do), you will make more than 3%.

  112. Real Amateur Says:

    Don’t be distracted by the current. Look at the big picture.
    —-

    I always love people who try to show “big pictures”. Interesting they are not the wisest or most successful or most helpful people on this planet. They are used car salesmen, real estate agents who live on commission.

    To quote Warren Buffett one more time:
    “Beware the glib helper who fills your head with fantasies while he fills his pockets with fees.”

    Did anybody mention “helper”?

  113. Amateur Says:

    —-
    Don’t be distracted by the current. Look at the big picture.
    —-

    I always love people who try to show “big pictures”. Interesting they are not the wisest or most successful or most helpful people on this planet. They are used car salesmen, real estate agents who live on commission.

    To quote Warren Buffett one more time:
    “Beware the glib helper who fills your head with fantasies while he fills his pockets with fees.”

    Did anybody mention “helper”?

  114. anon Says:

    “- At 5% interest rate, plus tax deductions, one ends up paying only around 3% rate. That’s a tremendous deal.
    A 3% interest rate to take a 20% loss? Great deal!

    - It is true that home ownership is generally not for people who can’t hold a steady job or don’t pull in sufficient income. On the whole home owners are a more successful group of people than renters. That’s not a secret.
    These are meaningless words

    - When you say delinquency rates are at 5.52%, that’s like saying the glass is 5.52% empty instead of looking at it as nearly full. The vast majority of the people are not delinquent.”

    Wow! I suppose things won’t be bad until we have a >50% delinquincy rate then! Looks like we’ve got a long way to go.

  115. SEA Says:

    “If you go talk with a financial planner, a typical target for investing is 6% / year.”

    It’s too bad that housing has gone down in value.

    Thus we have 3% interest, plus losses in market value.

  116. Real Estater Says:

    Pralay,

    You are the perfect example of someone who does not see the big picture. In fact, you create the wrong picture for yourself by extrapolating out things under the wrong assumptions (e.g. home inventory is rising, so it will rise forever).

  117. anon Says:

    Lol exkreter you are too cute.

  118. Real Estater Says:

    >>It’s too bad that housing has gone down in value.

    Correction: Some housing has gone down in value.

    In any case, let’s assume the above is true. You should perceive as a good thing, since you haven’t bought. You have an opportunity to build even more equity. Over the long term (again think big picture), there is almost no chance you will end up selling your house for less than you paid for. On the average, Bay Area home prices has doubled every 10 years. There is a strong history here that should give you every confidence in the future of Bay Area real estate.

  119. Used Car Salesman Says:

    (again think big picture)
    —-

    Big picture baby, big picture. Look at the big picture and buy my crappy car. Someday this car will be collectible and will sale for $100K.

  120. Real Estater Says:

    >>Someday this car will be collectible and will sale for $100K.

    Again, wrong assumption leading to wrong picture. Cars rarely make the owner any money. Even the most valuable cars are losing investments if you do the math.

  121. Used Car Salesman Says:

    #117 comes right from used car salesman’s manual.

    Translation of #117: SEA looks like a new guy. Let me try to convince him to buy a car. I think it will be easier to convince a new guy. I wish usual suspects like Pralay from third world country, Nomadick and Anon were not around here.

  122. anon Says:

    Same with houses – factor in maintenance, property taxes, etc and you will find that its more costly to own in the long term. That us, unless your a speculator.

  123. Real Estater Says:

    SEA,

    Don’t just take my word for it. There are plenty of homeowners here (Madhaus, DreamT, nomadic, and me). Ask any of us if our house is worth less than what we paid for. You’ll hear the exactly opposite. All of us have equity in our homes.

  124. nomadic Says:

    Even the most valuable cars are losing investments if you do the math.

    What math is that?

  125. Used Car Salesman Says:

    there is almost no chance you will end up selling your house for less than you paid for.
    —-

    LOL! Even Bernard Madoff wasn’t so courageous to say similar thing about his ponzy scheme.

  126. Real Estater Says:

    SEA,

    The second group here are the real rentards – Pralay, anon, Alex. You can almost tell by their behavior: rude, close minded, lacking logic, disruptive.

  127. Used Car Salesman Says:

    All of us have equity in our homes.
    —–

    SEA,
    You need to buy home so that Faux Estater can have his equity for his retirement.

  128. SEA Says:

    Real Estater- “Correction: Some housing has gone down in value.”

    By looking at specific homes, are you looking at the “big picture” or small picture?

  129. Real Estater Says:

    SEA,

    The big picture is that homes in every part of the Bay Area has been appreciating for over 50 years.

  130. SEA Says:

    Real Estater-”Ask any of us if our house is worth less than what we paid for. You’ll hear the exactly opposite. All of us have equity in our homes.”

    Great, again using the “big picture,” you purchased long ago in a far away time. What about those who purchased between roughly 2 to 7 years ago?

    Just be glad you, and others, hit the lottery and purchased before the bubble, not during, or near the top. I’ve hit the lottery in many investments too.

  131. SEA Says:

    Define appreciation.

    Is this San Jose appreciation?
    http://www.housingtracker.net/asking-prices/san-jose-california/

    San Francisco?
    http://www.housingtracker.net/asking-prices/san-francisco-california/

  132. Used Car Salesman Says:

    The second group here are the real rentards – Pralay, anon, Alex. You can almost tell by their behavior: rude, close minded, lacking logic, disruptive.
    —-

    Yes, they are rude, closed minded, lacking logic, disruptive.

  133. nomadic Says:

    Here’s a thread that explains appreciation to him:

    http://www.burbed.com/2010/03/16/what-to-do-if-your-house-wont-sell-raise-the-price/#comment-56469

    Hint: the house was rebuilt and enlarged. Most normal people might classify that as value-added activity. RE calls is “appreciation.” You’re not dealing with your average fool here.

  134. Used Car Salesman Says:

    SEA,
    Save Faux Estater from typing comments to demonstrate he is a “helper” who is trying to show you “big picture”.

    Just say “I am going to buy home today”. ;)

  135. Real Estater Says:

    >>Is this San Jose appreciation?

    Did you not understand anything I explained above? Why are you asking about 1 year appreciation?

  136. nomadic Says:

    Ask any of us if our house is worth less than what we paid for. You’ll hear the exactly opposite. All of us have equity in our homes.

    He’s talking apples & oranges here too. One can be living in a house worth less than the purchase price, yet have a healthy amount of equity. Shades of meaning for our “big picture” guy.

    BTW, he’s always said he bought in 2003 so he’s on the edge of a positive return. Being in the last bastion of the RBA helps.

  137. Real Estater Says:

    nomadic,

    Very simple question: Do you have any equity in your home?

  138. SEA Says:

    Oh, I understand appreciation so much better now.

    You buy a home for $1M, put another $500k in, and if it sells for $1.4M, that’s $400k in appreciation.

    It’s a quick and easy 40%!

    Thank you.

  139. Real Estater Says:

    >>you purchased long ago in a far away time.

    Not that long, but to your point – if you treat real estate as a long term investment, there is almost no chance in hell you will lose money.

  140. SEA Says:

    “there is almost no chance in hell you will lose money.”

    There is nearly 100% chance that you’ll be paying to maintain the home, among many other costs.

    Oh, that’s right, let me review #137.

    I understand much better now.

    Thanks again.

  141. Real Estater Says:

    >>You buy a home for $1M, put another $500k in, and if it sells for $1.4M, that’s $400k in appreciation.

    Here are the numbers for the actual house at 1029 Ramona Street in Palo Alto:

    - House bought for $1.35M on 1/30/2009
    - New owner did around $500K of renovation/expansion
    - House re-listed for $3.2M in March 2010. Sold in 1 week.

  142. SEA Says:

    Let’s talk big picture, not just that one property at 1029 Ramona Street in Palo Alto.

  143. Real Estater Says:

    >>There is nearly 100% chance that you’ll be paying to maintain the home, among many other costs.

    Not that much. Since I’ve owned my home, I’ve had plumbing clogged up a couple of times, fixed it with Drano, and some light bulbs go bad. Can’t really think of anything else. It’s not anything like car maintenance, since a house has no moving parts.

  144. SEA Says:

    The lawn has never been mowed? Nice.

  145. Used Car Salesman Says:

    there is almost no chance in hell you will lose money.
    —–

    Do you guys remember 2430 Cowper? When the owner bought it in 2005 for $1,215K, I am sure the agent and all the real estate experts said the same thing – “there is almost no chance in hell you will lose money“. You are buying in RBA where home price never drops. The listing went to as low as $888K, but still didn’t sell.

    Opps, I forgot. After it was purchased in 2005, this property started moving around in Palo Alto like a vagabond and eventually got stuck near a busy street. That’s why it is not selling for $1.2M anymore.

    So let’s rephrase Faux Estater’s statement: Unless your home starts moving around and then gets stuck near busy street, there is almost no chance in hell you will lose money.

  146. Real Estater Says:

    >>The lawn has never been mowed? Nice.

    Are you talking about the cost of gas for the lawn mower? LOL.

  147. SEA Says:

    Do you mow your own lawn?

    If so, how about your time? Maybe it’s not worth much?

    How about the machinery?

    Clearly you have understated the maintenance on a home.

    One of two things comes to mind:

    1. You have intentionally misrepresented the cost.
    2. You have no idea.

  148. Used Car Salesman Says:

    and some light bulbs go bad.
    —–

    Yes, some lights go bad. Think about it, owning home is such a maintenance free thing, I cannot think of ANYYYYYYTHINGGGGG that could possibly require maintenance. So I am mentioning about bulbs. Yes, some light bulbs go bad. :)

  149. Real Estater Says:

    >>Let’s talk big picture, not just that one property at 1029 Ramona Street in Palo Alto.

    Sure. These properties in Palo Alto closed last month:
    3499 Greer Rd – List price: $969K. Sold price: $1.075M
    3393 Kenneth Dr – List price: $979K. Sold price: $1M
    661 E Meadow Dr – List price: $1.2M. Sold price: $1.302M
    4260 Noble St – List price: $1.379M. Sold price: $1.433M
    171 Santa Rita Av – List price: $1.575M. Sold price: $1.6M
    859 Lincoln Av – List price: $2.749M. Sold price: $2.8M

    What’s the big picture? Overbidding is common. No downturn here!

  150. Real Estater Says:

    SEA,

    Are you serious? Fear of mowing the lawn is standing between you and home ownership? You are really focusing on the wrong things.

  151. Real Estater Says:

    OK, Pralay. Share your experience. What things have gone wrong in your rental home?

  152. SEA Says:

    As long as we are talking about the small stuff, I wonder if he’s ever had a battery in a smoke detector need to be replaced? Or a furnace filter?

    Big things like the roof, water heater, siding never requires anything. No moving parts. I’d really like to know how the garbage disposal, refrigerator, dishwasher, and furnace work without any moving parts.

    A house is not like a car, you know.

  153. SEA Says:

    Real Estater-

    “Fear of mowing the lawn is standing between you and home ownership?”

    What makes you think I don’t own?

  154. SEA Says:

    Real Estater-

    Regarding your list in message #148-

    I am sure that’s a random sample.

  155. SEA Says:

    Also, while I am at it, just because a home sells for over list does not suggest that the owners made a good investment.

    The only time a home sells for over list is when the list price is too low. That does not, however, suggest that the final selling price is more than the price that it was purchased for a few years ago.

  156. Real Estater Says:

    >>That does not, however, suggest that the final selling price is more than the price that it was purchased for a few years ago.

    Go look it up. Palo Alto home is known to be a good investment.

  157. Real Estater Says:

    >>What makes you think I don’t own?

    Why don’t you take the guessing game out of it? If you do own, even better. Just ask yourself the question: Do you have any equity?

  158. SEA Says:

    Now you are going to suggest that past performance guarantees future results.

    Comical.

  159. SEA Says:

    “Why don’t you take the guessing game out of it?”

    Remember, my guess was that you actually consider Dave Ramsey to be a financial professional.

    “Do you have any equity?”

    That’s not the right question. A better question is if the equity is increasing or decreasing.

  160. Used Car Salesman Says:

    Sure. These properties in Palo Alto closed last month:
    3499 Greer Rd – List price: $969K. Sold price: $1.075M

    —–

    Ok, I picked up the first entry 3499 Greer Rd from RealEstater’s “overbidding common” place.

    It’s comps:
    3485 Kenneth Dr(lot size little bit smaller): 2005 sale price $1M.

    3453 Kenneth Dr (lot size even smaller): 2008 sale price $1.295M.

    Wow! I can see what an appreciation in last five years.

  161. nomadic Says:

    One can be living in a house worth less than the purchase price, yet have a healthy amount of equity.

    RE, don’t post again until you understand what that sentence means.

  162. Real Estater Says:

    >>That’s not the right question. A better question is if the equity is increasing or decreasing.

    Another way to say it is, it’s not a matter of whether a home is making you money. The question is how much money.

  163. Used Car Salesman Says:

    BTW, he’s always said he bought in 2003 so he’s on the edge of a positive return. Being in the last bastion of the RBA helps.
    —-

    I am pretty sure Faux Estater is not liking these graphs, provided he understands it.

  164. Real Estater Says:

    >>Now you are going to suggest that past performance guarantees future results.

    There’s no guarantee in life, but 50 years of home appreciation comes pretty darn close.

  165. anon Says:

    Hey moron: When was the last time we had a depression like this?

  166. Used Car Salesman Says:

    There’s no guarantee in life,
    —-

    I agree 100%. There is no guarantee in life. Why not just jump off the cliff?

  167. Real Estater Says:

    >>I am pretty sure Faux Estater is not liking these graphs, provided he understands it.

    Who cares about these graphs. Show me the 10, 20, and 30 year graph for Palo Alto.

  168. madEstater Says:

    Wow! And way back in the fifties or so of this multi-national multi-timezone megapetaproject, RealEstater said my shack was still worth a million.

    No. It. Isn’t. And it hasn’t been worth a million for more than a year!

    Hey, SEA, I live in 94087! Want me to tell you how Special it is here?

    I’m also thinking of all the money I’ve paid maintaining the shack. Replacing all the windows. Replacing the galvanized steel plumbing with copper. New roof. Replacing appliances, multiple times. Re-landscaping, new driveway, new patio, new trellis, new arbor, etc. Lots of calls to plumbers, exterminators, appliance repair.

    And the stuff I didn’t replace in the last 15 years looks like it needs to be replaced.

    If RE claims he’s had no home maintenance costs in 7 years, he’s lying. Then again, that sentence doesn’t need a conditional, does it?

  169. SEA Says:

    Used Car Salesman-

    Following Real Estater’s basic claim that real estate doubles in price every 10 years, what do you think the chances that 3485 Kenneth Dr will be worth $2M or more in 5 more years? (Excluding, of course, major reconstruction, such as building a $3M home on the lot and selling it for $2M.)

  170. Used Car Salesman Says:

    Show me the 10, 20, and 30 year graph for Palo Alto.
    —–

    Considering the fact that you bought it in 2003, 30 year graph won’t that useful for you. All you need is a seven year graph.

  171. nomadic Says:

    There you go with the math again, SEA! (rolls eyes)

  172. nomadic Says:

    #156
    >>That’s not the right question. A better question is if the equity is increasing or decreasing.

    Another way to say it is, it’s not a matter of whether a home is making you money. The question is how much money.

    Post of the day!

  173. Used Car Salesman Says:

    Replacing the galvanized steel plumbing with copper. New roof. Replacing appliances, multiple times. Re-landscaping, new driveway, new patio, new trellis, new arbor, etc. Lots of calls to plumbers, exterminators, appliance repair.
    —-

    Wait, wait, wait! No bulb replacement?

  174. madEstater Says:

    Stultus est sicut stultus facit.

  175. madEstater Says:

    Wait, wait, wait! No bulb replacement?

    Nah, I’ve given up on tulips.

  176. anon Says:

    Come on now those are pride of homeownershit!

  177. SEA Says:

    “There you go with the math again, SEA! (rolls eyes)”

    Maybe I should try hand waiving?

  178. madEstater Says:

    >>There is nearly 100% chance that you’ll be paying to maintain the home, among many other costs.<<

    Not that much. Since I’ve owned my home, I’ve had plumbing clogged up a couple of times, fixed it with Drano, and some light bulbs go bad. Can’t really think of anything else. It’s not anything like car maintenance, since a house has no moving parts.

    RE should have read post #144 by Pralay:

    Do you guys remember 2430 Cowper? When the owner bought it in 2005 for $1,215K, I am sure the agent and all the real estate experts said the same thing – “there is almost no chance in hell you will lose money“. You are buying in RBA where home price never drops. The listing went to as low as $888K, but still didn’t sell.

    Opps, I forgot. After it was purchased in 2005, this property started moving around in Palo Alto like a vagabond and eventually got stuck near a busy street. That’s why it is not selling for $1.2M anymore.

    So let’s rephrase Faux Estater’s statement: Unless your home starts moving around and then gets stuck near busy street, there is almost no chance in hell you will lose money.

    I fail to see how a house can move to a busy street without any moving parts.

  179. Used Car Salesman Says:

    If RE claims he’s had no home maintenance costs in 7 years, he’s lying.
    —–

    It’s quite possible he is not lying. Although if there is no maintenance in 7 years, his home would look like today’s featured property. Checkout the satellite image.

  180. nomadic Says:

    Maybe I should try hand waiving?

    Couldn’t hurt. ;-)

  181. madEstater Says:

    >>If RE claims he’s had no home maintenance costs in 7 years, he’s lying.<<
    —–

    It’s quite possible he is not lying. Although if there is no maintenance in 7 years, his home would look like today’s featured property. Checkout the satellite image.

    Two Words. Meth lab. Wow, RE had a tremendous income in 2007 from his meth lab. I didn’t realize meth labs got hit with that much AMT.

  182. SEA Says:

    You know it’s bad when meth labs don’t sell.

  183. Used Car Salesman Says:

    That’s right. For Faux Estater 2007 happened to be a record year for me as far as income goes.

    So, does that mean, AMT = Alternate Methlab Tax?

  184. nomadic Says:

    nah, AMT = Almost Magical Tax

    You see, you cannot possibly know how much to pay in estimated installments and end up with a penalty every year.

  185. Real Estater Says:

    >>I’m also thinking of all the money I’ve paid maintaining the shack. Replacing all the windows. Replacing the galvanized steel plumbing with copper. New roof. Replacing appliances, multiple times. Re-landscaping, new driveway, new patio, new trellis, new arbor, etc. Lots of calls to plumbers, exterminators, appliance repair.

    Keep in mind madhaus lives in a “shack”. There’s a reason it’s called that. When I bought my house, it already has new windows, copper plumbing, high quality appliances (sub-zero, Bosch, etc), remodeled kitchen, and a roof that looks nearly new.

  186. SEA Says:

    “When I bought my house, it already has new windows, copper plumbing, high quality appliances (sub-zero, Bosch, etc), remodeled kitchen, and a roof that looks nearly new.”

    All with infinite life expectancy!

  187. madEstater Says:

    “When I bought my house, it already has new windows, copper plumbing, high quality appliances (sub-zero, Bosch, etc), remodeled kitchen, and a roof that looks nearly new.”

    All with infinite life expectancy!

    And each one wrapped with tax tape!

  188. madEstater Says:

    AMT = Arrogant Multi-national-multi-timezone-megaproject Tax

  189. nomadic Says:

    All with infinite life expectancy!

    See? The RBA is special!

  190. Real Estater Says:

    So far, we’ve seen a few questions being left conveniently unanswered:

    - Nomadic never addressed the question of whether he has equity in his home
    - Pralay never talked about what’s been fixed in his house

    Sometimes hearing no answer reveals a lot about what the facts are.

  191. Real Estater Says:

    >>All with infinite life expectancy!

    Quick, what do you think is the life expectancy of copper pipes?

  192. Real Estater Says:

    And the life expectancy of glass?

  193. SEA Says:

    madEstater-

    Message #110 is being ignored by Real Estater. I am sure he knows that the tax benefits of being a landlord are much better than owner-occupied. The next thing we are going to hear is that there is no competition, and the landlord gets to keep all the tax benefit. The rent could not possibly be lower because of the government sponsored extra tax benefits of renting.

    All expenses are tax deductible for a rental, and the standard deduction is preserved.

    Wonder why Real Estater has tax problems?

    It might be more interesting to find the break-even point of differences of expected future housing price appreciation. Real Estater has suggested that he expects housing prices to double every 10 years (~7.2% per year). If I expect housing prices to double every 12 years (~6% per year), without further information, it appears that I should be renting, as the investment community has higher expectations, and thus values the property higher.

  194. Real Estater Says:

    As I walk around town, I see many homes that are over 100 years old. It just goes to show a home is the most long lasting purchase you can ever make. Odds are good that the homes you’re living in now will out-last you.

  195. SEA Says:

    “Quick, what do you think is the life expectancy of copper pipes?”

    I don’t keep track of the life expectancy of copper pipes, but the Bay area doesn’t have much of a problem with temperature. Similarly, there are various problems with cars that I don’t keep track of, but I am not going to suggest that wiring has an infinite life expectancy, for example.

    “And the life expectancy of glass?”

    5 to 20 years with 10 to 15 years being typical, depending on service and quality.

    Water heaters are about 10 years on average.

    All this said, I don’t have actuary charts for copper piping, windows, water heaters, roofing, etc.

  196. SEA Says:

    There is a big difference between maximum life and economic life.

  197. madEstater Says:

    Odds are good that the homes you’re living in now will out-last you.

    Absolutely! I expect the ceiling of this no-longer-worth-a-million shack to cave in and kill me at any moment!

    SEA: You do not *not* want to hear me snarl about my adventure in landlordship. Plenty of tax advantages, and I just loved the late-night calls when stuff stopped functioning. Must be all those moving parts that made it wander from I-680 all the way to Stockton.

  198. madEstater Says:

    Dang it! I forgot to mention I’ve replaced the water heater twice! Think crapshacks in 94087 make them age extra fast?

  199. SEA Says:

    “Odds are good that the homes you’re living in now will out-last you.”

    Really? How many people are born and live their entire life in a one home?

    Who knows, maybe my bones will outlast my life, or at least I hope so.

  200. SEA Says:

    “Think crapshacks in 94087 make them age extra fast?”

    Think if the Post Office re-allocated the zip codes in the area and you ended up in a new zip code. The water heaters would last much longer.

  201. madEstater Says:

    Think if the Post Office re-allocated the zip codes in the area and you ended up in a new zip code. The water heaters would last much longer.

    Yeah, but what if my new Zip code isn’t as Special? Don’t you think that’s worth the cost of 2 water heaters and 2 furnaces? Or was it 3?

  202. SEA Says:

    madEstater-

    The tax benefits of being a renter are much better than being owner-occupied. The tax benefit is realized each and every month in the form of lower rent.

  203. madEstater Says:

    The tax benefits of being a renter are much better than being owner-occupied. The tax benefit is realized each and every month in the form of lower rent.

    What the hell are you, SEA, some kind of arrogant renter? At least the angry ones are easy to put in their place. I usually just laugh at them finishing their taxes in 2 minutes with a 1040EZ form.

    Seriously, this is intriguing… you rent your home to me, I rent my home to you? Well, how Special is your ZIP code?

  204. anon Says:

    “As I walk around town, I see many homes that are over 100 years old. It just goes to show a home is the most long lasting purchase you can ever make. Odds are good that the homes you’re living in now will out-last you.”

    By now we all know how new you are to the RBA, real estater. Never the less you do not have to constantly show it. Those homes are there and they are still in good condition because people have maintained them. A building and even a small amount of yard require significant expenditures to maintain – from roof replacements to weeding, all these expenses should be calculated into your pride of ownership.

    Real estater, I hope this been helpful.

  205. Real Estater Says:

    anon,

    Why don’t you try to maintain the same car for 100 years? I doubt your Cayenne would still driving after 20 years.

  206. McFly Says:

    I have no idea how real estater got to talking about how long a home lasts, but what matters isn’t how long a home “lasts” but how much it costs to keep “lasting” (ie. operating costs).

  207. SEA Says:

    Real Estater-I know you love these specific examples that are not representative so, for what it’s worth, Irv Gordon has put over 2.6 million miles on his 1966 Volvo. He has suggested that he will exceed 3.0 million, but he is not holding up as well as the car. His doctor has slowed him down.

  208. SEA Says:

    “you rent your home to me, I rent my home to you?”

    Then we can play the ultimate game of dodge ball! If someone asks if we rent or own, we can answer either way, depending on the circumstances. If market values are going up, we will suggest we own. Market values going down? We rent! If someone asks about the tax benefits, we discuss being a landlord. We have all the benefits of being an owner and a renter at the same time. How could this go wrong?

    “Well, how Special is your ZIP code?”

    I am sure my zip code is not special.

    How to make the big bucks:

    Oh, and to really make some cash, we could sell the homes back after 10 years for double the purchase price. We both would have a nice gain on the sale. Sure we are buying the homes we have lived in and rented for the last 10 years… Hell, if we did this today, we might end up with $8k from the IRS and $10k in potential California tax benefits! (Note that rational players would want to push the sale price down close to the book value, so we don’t pay any taxes, yet if we do this, then it doesn’t look like we are making any money. What’s wrong with this world?)

  209. nomadic Says:

    So far, we’ve seen a few questions being left conveniently unanswered:

    - Nomadic never addressed the question of whether he has equity in his home
    - Pralay never talked about what’s been fixed in his house

    Sometimes hearing no answer reveals a lot about what the facts are.

    As soon as you demonstrate an understanding of the statement in #160, I will answer your stupid question.

  210. SEA Says:

    Many of the questions that are “conveniently unanswered” were directed at Real Estater…

    I will say, however, that suggesting that no answer reveals a lot about the facts tells me plenty about Real Estater’s penchant toward intentional misrepresentation by omission. There is nothing new here.

  211. nomadic Says:

    I will say, however, that suggesting that no answer reveals a lot about the facts tells me plenty about Real Estater’s penchant toward intentional misrepresentation by omission. There is nothing new here.

    I think he says that to try to elicit answers. Like we care what he thinks in his narrow, convoluted head.

  212. Alex Says:

    Wow. I don’t read this crap board for a few days and you guys went to town on Faux Estater.

    LOL

  213. mike Says:

    $349,000 1024 TILTON Ave San Mateo, CA 94401

    $50k price drop. fire sale!

  214. mike Says:

    Reduced to $299k,000!
    $90k reduction!
    Hurry and Buy!Buy!Buy!
    Won’t last long!!!!

  215. nomadic Says:

    heh, anyone who’d buy this place without requiring the bank to remove the squatters first is completely insane. The pictures tell me they have no real interest in selling and are going to hang around until they’re forced to leave. Why hasn’t the bank foreclosed yet? Are the occupants really making payments?

  216. SEA Says:

    This place needs to be bumped to the front page of burbed!

    Flip with a current list price of $580k.

    “* * * * Outstanding and rare, just built from the foundation up 4BR/2BA home including new roof & dual pane windows. Enjoy sun-filled master bedroom w/ glass doors leading to pleasant backyard with citrus and avocado trees, perfect for entertainment or relaxation! Gorgeous, spacious culinary kitchen with granite counters. Convenient location near down town San Mateo w/ easy access to freeways.”

    May 27, 2011 Sold (Public Records) $255,000 – Public Records

  217. SEA Says:

    Now Staged, & backsplash…

    “* * * * Now Staged! Gorgeous, just built from the foundation up. Darling 4BR/2BA featuring sun-drenched master bedroom with glass doors leading to pleasant backyard with citrus and avocado trees, perfect for entertainment or relaxation! Awesome eat-in culinary kitchen with granite counters & backsplash. Convenient location near downtown San Mateo with easy access to freeways.”

  218. SEA Says:

    …and there’s a $40k price reduction [= ~7%]–let the overbidding begin!

    Oct 25, 2011 Price Changed $539,000
    Sep 29, 2011 Listed (Active) $579,500
    May 27, 2011 Sold (Public Records) $255,000

  219. ms Says:

    1024 tilton bom flipped at 540.
    sea, you are a winner
    http://www.redfin.com/CA/San-Mateo/1024-Tilton-Ave-94401/home/1274363


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