[FoRK] Does this real estate boom remind you of the dot-com boom?
Strata R. Chalup
strata at virtual.net
Thu May 19 16:23:04 PDT 2005
Cleopatra Von Ludwig wrote:
> Invest elsewhere, meaning...? So, say you sell your home and cash in on the
> boom. Then what do you do? Live in a cardboard box? Pay too much for a
> lesser home? Move to Kansas? Rent?
Or do what we did, and buy a not-brand-new manufactured home in a nice park.
For the cost of a typical downpayment on a South Bay townhome or condo, we got a
1440 square foot place with a big garden and patio out back. Sure, it won't be
our nest egg for retirement-- most likely outcome is that either it will be a
wash or depreciate slightly. However it keeps our monthly costs down, and
frees up money for investment elsewhere.
The Bay Area mfr/mobile home market seems to be an interesting predictor of real
estate. Back in the boom, a place like ours would have gone for about $100K.
Not to someone who would live in it, but to a real-estate firm specializing in
mobiles. They'd haul the old one off the site and put in a custom home for
$50-70K, and still make a very tidy profit selling it new to someone for $200 -
225K. Yep, a double-wide for over $200K...but it's superinsulated, has corian
everything, etc etc.
Now of course the same thing goes for $135K - $150K, and a lot of folks are
underwater on them, so you see 1 - 3 year old gorgeous ones being sold left and
right by folks who just want to get out from underneath. And there's still a
decent market for new and used ones.
So if times are good when we decide to eventually sell, we'll get at least what
we paid for ours, because someone will want to use the lot to upsell a new one.
Heck, if times are that good, we might finance the building of a new one
ourselves, and pocket that nice chunk-o-change difference. If times are 'bad',
well, if we keep the place mechanically sound and take care of it, there's kind
of a minimum for a mfr home in move-in condition, kind of like the minimum for a
running car that isn't being sold because of something to spendy for the current
owner to fix.
The monthly lot rental is still only 2x a typical low-end Association Fee, and
there's no potential for getting hit with a Special Assessment for new shared
roofing, parking lot repaving, etc. In the long run, we feel it's a good deal.
I also can't resist the psychological aspect of it. We ARE living in the
"Dymaxion Home", it's just not dome-shaped. There's a hell of a lot about
mobile home parks (the 'good' kind, with standards, minimum credit scores, and
rulebook enforcement) that makes a lot of sense in the modern world.
Strata Rose Chalup [KF6NBZ] strata "@" virtual.net
VirtualNet Consulting http://www.virtual.net/
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