Saturday, September 8, 2007

I just love your carpets

There were so many ugly photos of this Culver City wreck that I didn't quite know where to start. How about starting with the living room. What are those stains just above the window? Could it be mold?

Horrific is the only word that adequately describes the carpet. There is something really creepy about old rugs. They are so unhygenic. Just imagine all those sweaty fungus-filled feet that have tramped over that rag. It is so disgusting that I feel I need a bath just from looking at it.

What does the realtor have to say about this wreck? Lets put it this way; you can always rely on a realtor to say something insanely stupid. This wreak is described as "designer ready". However, the realtor did implicitly concede that there might be something wrong with the current floor covering arrangement. Apparently, there is "wood under the carpet". The realtor also suggests that there is a large yard. Based on the photo above, does anyone agree with that statement?

There is, however, no disagreement about the size of the price. The owner is doing his best to "big-it-up". This dog is on the market for a nasty $800k. Incidentally, that is almost a 100 times more than the house in Pennsylvannia, posted on the previous listing.

I couldn't finish the posting without including this photo. This room is obscenely ugly. Painting a wall dark blue and then putting down some brown carpet must rank as the dumbest home design decision out there.

Thanks to Cara for sending this one. The listing can be found here. There are any other nasty home design features out there. If there are, we need to see them.

More affordable housing

It is not entirely clear which of these Reading (PA) houses are on sale. The price - a very reasonable $8k - suggest that it is the burnt out one on the left. However, the photo is centered on the grey one on the right. Moreover, the listing doesn't mention anything about fire damage. The mortgage on this place is just $42 a month. There are some restaurants in DC where a hamburger will cost you more than that.

Few days ago, a burnt out wreck from Baltimore was posted on this site. That property was listed for $120,000. Baltimore is a city I know well. There are some great people living there, but let us be frank; it isn't San Francisco or New York. It is very tough town. I am less familiar with Reading, but it is hard to believe that life there is 14 times worse than Baltimore. However, that is what is implied by the price differential between two cities.

Of course, realtors will shout out that the difference is location. However, inertia is a more likely explanation. It takes time for sufficient numbers of people to migrate from high cost to low cost cities. Nevertheless, it does happen, which suggests that Baltimore is massively overvalued, while Reading might make a better long term real estate investment.

Many thanks to Jay, who told me that I shouldn't mention that Pennsylvannia is a great place to live. Jay was afraid that everyone in California might sell up and move there. Sadly, that is something I cannot do. Pennsylvannia is one of my most favorite places in America. It is time to sell up and move.

Tear me down

I thought we had reached the limit of teardown madness when I posted a $1 million wreck about a week ago. However, this beachside wreck pushes out the boundary by a further two million. It is listed for $3.3 million. There is one paradox that I can't resolve. How can anyone smart enough to accumulate at least $3 million of wealth be stupid enough to buy this house?

There is no such paradox in the realtor's mind. The write up advises prospective buyers to "drive by, stop and sit on the front steps and experience the incredible ocean ambiance and resort living". In contrast, I advise to drive by and just keep driving.

Many thanks to Bob for this one. Bob suggests that rather than an ocean view, this house is situated in front of a large parking lot that holds about a 1000 cars. The listing can be found here.

Affordable housing

Here is a headline that grabs your attention "Cheaper than a car". This craigslist advert from New Orleans is offering a 3 bedroom house for $19k. Moreover, the house only needs a further $5-10k to fix it up. Compared to some million dollar slums in LA, DC and other overpriced bubbletowns, this house looks rather reasonable. So if you are finding it difficult making ends meet in California, sell the SUV, and move south.

Many thanks to "DHSEscort" for this one. If you know of any affordable housing, send it here

Million dollar bedroom

The new owner of this $1 million dog from Rhode Island better be neat and tidy. There simply isn't any floorspace to pile dirty clothes. While the bedroom might be a little tight, you can console yourself with a sea view.

Marie, who sent in this one, suggested that she had seen more comfortable motel rooms. Personally, it reminded me of the old Soviet Intourist hotel room. If you are unfamiliar with an Intourist room, count yourself lucky.

Here is another oddity, the realtor calls this a "Victorian". The house was constructed in 1935. However, Queen Victoria died in January 1901.

Many thanks Marie for this one. The listing can be found here. Are there any other luxury bedrooms out there? If so, send them here.

Evil exists - it is called the condo conversion

Crackhouses, garden sheds and shacks might be amusing, but condo conversions are evil. They are invariably overpriced and threaten to lure naive investors towards financial disaster.

Yesterday, I received an email from ARMMAT, who sent me details of a typical new development in Brentwood California, which is currently on craigslist. Prices range from the mid-400s up to the mid-800s.

The featured apartment is a particularly tasteless and unimaginative conversion. The kitchen has overdosed on granite; there is even some plastered onto the walls. Why have bay windows, when the view is of a wall? The bathroom had some uninspiring wall-to-wall tiling. The ad also goes very heavy on financing options; "We have in house financing and work with first time home buyers. We can get anybody financed."

That last sentence could be an epithet for this bubble. "We can get anybody financed". It doesn't matter the credit history, income levels, or financial IQ of the borrower, there is a financial institution out there ready to write the mortgage check.

ARMMAT took the initiative to send a quick email to the realtor, who goes by the name of Timothy Lo Bello. Here is the exchange, (without edits):

ARMMAT - Regarding your ad for the above property. At $530K and a 6.25% APR, we're looking at around $3270, 30yr fixed loan at best. Plus $552 for, and another $2-300 for insurance; grand total being around $4-4.1K per month...FOR A CONDO?

The boom is over...adjust the prices...anyone paying that much for a condo where they don't even own the land is an outright idiot. If they fall for such crookery, then they deserve to be stuck in a $4K payment.

Timothy LoBello - I agree. Were 100% sold out. Go and figure? We have 3 new projects on tap and most are pre-sold. enjoy

ARMMAT - Of course you are...I'd be rich for every single time a broker told me that one...Hurry up and buy! You'll miss out!

If in fact it were true, then there are even more idiots out there than I initially thought...I hope they can sustain their mortgages you put them in as their ARMs run out. Perhaps you're fit for American's Overvalued Real Estate Blog....might be worth the exposure.

The realtor says "Go and figure". I have gone and figured, and I reckon that purchasing this condo is financial madness. What I can not understand is why others can't figure it out as well.

Thanks to ARMMAT for the email and the recommendation. Have you had a similar surreal moment with a Realtor recently.

Movin' out

Imagine, just for a moment, living in a 500 sq ft condo just like this one in Boston. It is a a third floor atttic conversion in an unimpressive single family home, in an unremarkable neighborhood. What exactly would be your quality of life?

The center of the room is the only place that you can stand up straight. The kitchen is tiny. The bathroom is so narrow that you won't be able to wash under your arms. You would have nowhere to store your belongings. Moreover, you would be too embarrassed to invite anyone home. Ultimately, the only thing this condo offers is a life of misery.

If you are asking yourself whether you can afford this $145k condo, then you are asking yourself the wrong question. Instead, you should be asking whether it is time to move out of Boston and find a city where you can afford to live. There are plenty of cities in the mid-west where $144k would buy a respectable family home. Salaries may be higher in Boston than the mid-west, but the difference isn't that great. Contrary to what realtors say, it is not about "location, location location". Rather, it is about quality of life. Currently, many bubble cities just can't offer a decent affordable lifestyle for many Americans. Either the market corrects or it is time to move.

Thanks to Sarah for this recommendation. The listing can be found here.