Madison WI, Real Estate and Residential Rental.
Posts tagged The “Free” Market
All Used Up
Apr 3rd
I had a thought today and said to myself I should have a blog and write about that. I guess it has been a while since I “blogged”.
I was asked to value a rental property from the hip. I made some assumptions and with the aid of my spreadsheet I gave a pretty tight range in minutes. Then I walked past it and thought, well, that place is all used up.
One of my assumptions was that the home had been cared for, that is was a healthy asset. This really goes back to my a home is an investment (bucket with a hole in it) that requires maintenance and care both to keep from depreciating (leaking, to fill and to keep full.)
If you own a property, and have milked it of too much value, by collecting rent, living in it care free, not being a good steward, letting things go, then your home may be nearly used up. How much is it worth? How much have you not used up?
Don’t think your short cuts and indifference were decisions made with no cost. Make it a parenting example or whatever is easiest for you to relate to. If you were not a present and active parent, don’t expect your child to put you in the best nursing home, or to cash in on huge gains in real estate. In this market, you’ll be lucky if they go to a good school and move out of the house by the time they are 20.
The Title Company, a necessary evil?
Jan 13th
Maybe this only happens to me, but every once in a while people will get down on the title company, calling them vultures of the real estate industry with their nickel and dime fees, added costs and perceived bureaucracy. I had never called them all those names but they do sell title “Insurance”, which as Ned Flanders the devout Christian on “The Simpson’s” will tell you is a form of gambling. Title Insurance as we know it today replaced the previous practice of a lawyers review of a properties abstract. So let me tell you what I just did. At the advice of several folks in the insurance, tax and real estate industry I am transferring ownership of the two rental properties my wife and own to an LLC. Anton Homes LLC to be exact. The quit claim deed can be used in this circumstance. It allows and individual to transfer whatever right they have, limited or total, whatever they are to another party. As Sandy and I will transfer it to ourselves, we did not need a title search or insurance, just a deed with our signatures, and our signatures.
Simple, Right? Wrong, you forgot about the government and taxes. We will not be taxed on the transfer as we are married but are still required to file a transfer return. This tedious process can only be done on-line and was clearly not designed to be consumer friendly. It was ridiculous. I gave up 2/3rds of the way through and called Jeanie the title lady. It was that poorly designed difficult to work with. So while a title company does have all sorts of fees and costs and perceived layers of bureaucracy, they also specialize in dealing with and creating a buffer between the consumer and other agencies, governmental and/or financial that have even greater costs, fees, and countless layers of bureaucracy.
Four Dollar Coffee
Apr 28th
I read articles all the time that link a spending habit or surge in one categories numbers to a different industry or market trend. Evidently the $4 coffee has seen a re-birth in the last few months. Starbucks and other purveyors of overpriced lattes are back in the black. Pundits, journalists and baristas alike feel this is a sign of our economy’s rebirth and we are on the mend.
The masses’ willingness to indulge, treat themselves, pay more for less, spend outside their means, and exercise a “we’ve worked hard to get through these “trying times” mentality all point to consumer confidence and the light at the end of the tunnel.
I though might take a moment and ask of you this: Is not the four dollar coffee and all it stands for exactly what got us in trouble the first place?
