SonnyPage on Housing
[PS I asked him if this was a halloween spoof and he sent me a PM and said sadly, no.]
Most of you know that my wife and I are realtors. We live and work in Roswell and Alpharetta, which are suburbs north of Atlanta. About three months ago, Margaret listed her home with us. She is an elderly widow, about 75, and still lives on the small 10 acre farm she and her late husband bought twenty years ago. They retired there and he passed away about ten years ago. We helped both of her adult daughters buy and sell homes here in Alpharetta over the past few years. So, when it came time for Margaret to sell, they had us give her a call. Margaret's old farm is about twenty miles to the north, out in the country. Her daughters think, and Margaret agrees, that she needs to sell and move closer in to be nearer them and the grandchildren. So, time to sell.
We had an interesting call from Margaret first thing this morning. She needs to take her farm off the market at once, as quickly as possible! It seems that this past week she drove down to visit old friends in Florida, down in Sarasota. Her friends told her of a neighbor's house there that had just come on the market. It was the first day on the market. The realtor had not even had time to put it into the listing service. Margaret looked at the home. Her friends told her it's a great buy. "Homes there are appreciating like crazy", Margaret told us. "There is way more demand than houses to go around. They just keep going up", she told us. So, she was under contract. But what does that have to do with taking her home here off the market, we asked? Margaret went on to explain. She does not intend to move down there, to actually live in the house. "It will go up in a few months and I will sell it", Margaret explained. "They just keep going up!!" But, how to pay for the house. She has only a limited amount of money, mostly in CD's for income. And there is the problem. Not enough income to live on. So, Margaret is going to borrow on her home here to buy there, wait a few months, then sell. Presto, lots of money to live on. The mortgage lender here says she must take her farm off the market while the loan is being processed, then she can put it back on the market. But she will now go from no mortgage payments to two mortgage payments. How will she do that, we asked? It's o.k., Margaret explained.It will only be for a few months and then I will sell the house in Florida. My wife and I know that real estate in many parts of Florida has doubled or better in the last two years or so. So, this is a sure thing for Margaret, right?
Let's see if you have the picture. An elderly widow, with very limited means, is mortgaging her paid up home here, for half of its $400,000 value, to buy a home in Florida that she will sell in a few months for a profit to live on. Her farm here represents a goodly part of her net worth. She has the farm, a little money in the bank, and her social security. Social security and today's low CD rates aren't making ends meet. No problem, she will simply buy property in Florida and sell in a few months, as her friends assure her, for a very nice profit. I am reminded of the story we have all heard of that famous stock investor back in the late 1920's who sold all of his stock when his shoe shine boy tried to give him a stock tip. I wish Margaret well.
Happy trick or treating to you all.
sonnypage |
