May 31st, 2005
Well, it actually worked. I managed to scam the bank into giving me $20,000 AND lower monthly payments on my mortgage! OK, really we just refinanced our loan for a lower interest rate and got rid of our monthly Private Mortgage Insurance (PMI) payment because the equity in our home has almost doubled in the three years we’ve lived here. But the long and the short of it is: I got a check for $20,000 today! Woo hoo! So the remodel is officially funded and the old kitchen had better get ready to duck and cover. Next: the Planning Phase, and after that Demolition, baby!
May 29th, 2005
Who doesn’t love a three-day weekend? We have been accomplishing much and relaxing tons; it’s been the perfect combination of work and play.
On the work front, I gave a listing presentation yesterday to a family in Tempe. I knew, going in that they have met with several other Realtors. They are feeling out the market and trying to find the right person to help them sell their house. I definitely do not blame them for this. There are, admittedly, lots of real estate agents out there, and everyone talks a different game. It’s smart to see what a few different people have to say. I felt like my meeting with them went well. I had lots of throughly researched information for them and I felt good that I was totally honest about where the market for their house stands right now. The thing is, however, I know at least one of the other Realtors they met with gave them what seems to me to be a very high estimate of what they can get for their house. I let them know it sounded high to me and showed them where I was getting my information from, but that ultimately, what to list their house at is entirely their decision. It is their house. My responsibility is just to let them know the risks and drawbacks of making a move like that. So… I’m not sure what it is that will make or break this deal for them. Is it the lowest commission? Highest recommended listing price? Most useful information presented? Honesty? Personality? Outfit? Cute earrings (hopefully this one is the most important, because I was wearing these really great dangly pearl ones my mom made me for my birthday)? The experience spawned my new poll (to the right).
And then there was the play:
Jason and the boys spent countless hours building with the insane amount of Lego’s Jason recently bequeathed to Ben. When Jason first told me about the extensive collection of Lego’s at his parents’ house in Oregon that he wanted to give to Ben, I was touched. What a sweet, fun thing for him to share with his son. It wasn’t until the day after he gave them to Ben and they had spent literally six hours building elaborate ships and castles, that I realized the ’sweet gesture’ was at least 50 percent opportunity for Jason to relive his childhood passion for architecture. And yes, it’s still pretty cute that they spend hours together playing with those square bits of plastic, but I do have to wonder if he’s hiding from the yard work back there…
Lastly, I’m so excited to share that I’ve made an appointment with a contractor to come out and quote our kitchen and bathroom project. She is a kitchen cabinet expert, but has partners that can do anything that needs to be done in the home. She’s going to come out a week from Thursday to measure our kitchen and bathroom and talk to us about what we’re looking for so she can put together a quote. She told me that we can have as much help with our project as we want, or we can do it all ourselves. AND, she doesn’t charge to quote, which already puts her about five steps above Home Depot in my book. If she makes me happy at all, I will definitely post her contact info on here soon enough. I’m so excited for my new kitchen!!
I hope you are all having fabulous weekends as well!
May 25th, 2005
Yesterday, when I was pulling some property info off the ARMLS site I came across a statement in the ‘Realtor Remarks’ section that I didn’t understand at all. It said “Land lease amount in arbitration.” Now, of course I understand the definitions of the individual words (when I called and asked the listing agent what she meant by this she said, “Uh… they’re currently arbitrating the amount of the land lease.” Thanks, ma’am, I wanted to say, now that you’ve switched the order of the words around for me it makes perfect sense), but the concept of a ‘land lease’ was one that I hadn’t yet encountered. After my attempt at extracting an understanding from my fellow Realtor was thwarted, I called my manager at the Century 21 office.
He explained that someone (in this case, a trust) bought the land before any of the houses were built on it and still currently has ownership of the land. So when you buy the house, you really only buy the house. The land underneath and around the house has to be leased to you for a monthly fee. In another home I found, the land lease amount was 0.1% of the sale price per month ($469 per month). In the case of the original house I found, however, the land lease amount was ‘in arbitration,’ meaning you would be buying blind, with no amount set until some unspecified time in the future. This sounded like a real bummer of a deal to me. It sounded kind of like an HOA fee, but potentially lots higher than even the highest HOA fees I’d seen, and with none of the benefits. It’s not like the owner of the land comes around and mows your lawn for you or anything. So I asked my manager, “How would this benefit my client at all?” He didn’t beat around the bush with his answer that there just isn’t really any benefit. “I would stay away from deals like that,” he cautioned me. And that makes sense to me. In real estate, generally it’s not the structure on a piece of property that appreciates, it’s the land. The structure will continue to deteriorate and require repairs, while the land it stands on is what they defined in my real estate classes as indestructible. No matter what you put on it, how you plant it or even dig it up, a piece of land cannot be moved, and it cannot be destroyed. So the land is by far the better deal in the house vs. land debate.
Ultimately, I guess the answer to my initial question would be that it depends which side you’re on. For now, until I hear a reasonable argument for it, the only way I’m getting involved in a land lease is if I’m the one buying the land.
