Comments on: Behind the Scenes: One South Bend House Sale

By: ND Tom

ND Tom — Tue, 30 Jun 2009 18:28:56 +0000

Looking forward to see the June sales numbers….always interesting and appreciated! Especially the ND related properties and actual closed units for Ivy Quad, Irish Crossings, Stadium Village, and Eddy Street Commons to name a few. Also, any update on the North Douglas Condo situation and Woodbridge Villas?

By: Dean

Dean — Wed, 24 Jun 2009 23:06:58 +0000

I would have gladly traded places with you Nick. We sold our house in April and had to bring $15357.97 to closing.

By: Nick Molnar

Nick Molnar — Wed, 24 Jun 2009 22:16:17 +0000

You’re likely right that the owning the house wasn’t a “profit” if you account for money spent during occupancy. We never considered that house an investment since it was our home. I’m not going to get in CPA type math here, but I’d guess it was pretty close to a wash owning since our mortgage included an escrow for insurance and property taxes, and was a bit less than the house would rent for. Maintenance was minimal on a 17 year old home and we weren’t a villa so our association fee was $60 annually.

For a house we owned that made money, I’d tell you about the 1920s home we bought out of foreclosure for $104,000 that lacked a kitchen and furnace. We put about $50,000 into it, worked on it for three months and sold it for $245,000. When we finished it was less expensive and in better condition than the homes for sale around it.

The homes most people live in are not investments. If you’re reading that and you can’t dispute your case with hard numbers, it’s likely not an investment. The days of expecting windfalls simply by owning a house are gone. But you can make money owning property. Most commonly I see it with rentals and rehabs, but it can even be the house you live in. For an example of that hybrid strategy, keep coming back to read about the house we bought and our strategy for rehab and resale in a few years.

Even for those who don’t want to buy a house that needs renovation, moving when you have to take some cash to close can make sense if you cut your debt and monthly expense dramatically. It depends on the amounts involved, the situation you are in, and the decisions you make.

By: B. Nolan

B. Nolan — Wed, 24 Jun 2009 20:02:25 +0000

You have some incomplete, fuzzy math in there at the end, when you say “We bought the house in 2003 for $148,000 so we actually made a small profit”. In addition to the money you paid at closing, you forgot to mention the costs of ownership that usually make ownership a money loser, as realtors often do. I am sure you paid homeowners insurance, property taxes, maintenance & repairs and association ‘villa’ dues for each of the last 6 years that totaled more than $7,000 (or $1,167 per year). Regardless of the money you paid at closing, there is no way you would have profited from owning this house.

The idea that home ownership is always a good idea is one that is primarily responsible for the current financial meltdown.

By: Bender

Bender — Wed, 24 Jun 2009 16:40:05 +0000

Nice honest post…..had a very similar experience selling an existing home in a very established but newer neighborhood in the area. Shouldn’t have put it on the market in August since the fall hit with the credit crisis and holidays. Great showings, just no offer for a long time. The market is what it is….