Beware of "Bargain" Foreclosures

Meth labs in homes across the US are a big problem. And the health issues are not limited to the meth users. This story came as a bit of a surprise to me -- that toxic residue from meth labs in homes can linger for years, and have very negative consequences for new owners of the home.

Federal data on meth lab seizures suggest that there are tens of thousands of contaminated residences in the United States. The victims include low-income elderly people whose homes are surreptitiously used by relatives or in-laws to make meth, and landlords whose tenants leave them with a toxic mess.

Some states have tried to fix the problem by requiring cleanup and, at the time of sale, disclosure of the house’s history. But the high cost of cleaning — $5,000 to $100,000, depending on the size of the home, the stringency of the requirements and the degree of contamination — has left hundreds of properties vacant and quarantined, particularly in Western and Southern states afflicted with meth use.

“The meth lab home problem is only going to grow,” said Dawn Turner, who started a Web site, www.methlabhomes.com, after her son lost thousands of dollars when he bought a foreclosed home in Sweetwater, Tenn., that turned out to be contaminated.

Because cleanup costs are so high, many families have no option but to suffer or walk away.

Meth contamination can bring financial ruin to families like that of Francisca Rodriguez. The family dog began having seizures nine days after the Rodriguezes moved into their home in Grapevine, Tex., near Dallas, and their 6-year-old son developed a breathing problem similar to asthma, said Ms. Rodriguez, 35, a stay-at-home mother of three.

After learning from neighbors that the three-bedroom ranch-style home had been a known “drug house,” the family had it tested. The air ducts had meth levels more than 100 times higher than the most commonly cited limit beyond which cleanup is typically required.

The former owner had marked “no” on a disclosure form asking whether the house had ever been a meth lab, Ms. Rodriguez said. But because he is now in prison for meth possession, among other things, the Rodriguezes decided there was nothing to gain by suing him. They moved out, throwing away most of their possessions because they could not be cleaned, and are letting the house go into foreclosure.

“It makes you crazy,” Ms. Rodriguez said. “Our credit is ruined, we won’t be able to buy another house, somebody exposed my kids to meth, and my dog died.”

There was a 14% increase in the number of home-based meth labs discovered last year. This is clearly another housing crisis, and we have a mish-mash of inadequate state laws dealing with the matter, all of which are woefully inadequate.

About 20 states have passed laws requiring meth contamination cleanup, and they use widely varied standards. Virtually all the laws hold the property owner financially responsible; Colorado appears to be the only state that allots federal grant money to help innocent property owners faced with unexpected cleanup jobs.

This is not the American dream.

Stupid People: They're Everywhere

Money can't buy common sense. That's for damn sure.

This house is for sale.

By the time Stan and Dorothea Cheslock moved into their 26,000-square-foot dream house on 30 acres here, they were already dreaming of getting out.

“We kind of knew even before the house was finished that it was too much house for us,” Mr. Cheslock, who made (and lost some of) a fortune in finance, explained the other evening as he showed a visitor around.

Hey, the next time you aren't sure about something of this magnitude, give me a call and I'll advise you for about $150,000 and save you the hassle of realizing you made a multi-million dollar mistake.

The Cheslocks, who sold their previous home in Greenwich for $12 million, bought the property for $7 million in 2000, spent nearly $14 million and four years building the house, and put it on the market in 2006 for $31 million. No takers.

Here comes another konagod boo-hoo moment. Damn, where did I leave my compassion? It was here yesterday!

These people are emtpy-nesters -- the kids are grown. It's just them! The house has a terrace that's bigger than my entire house, and sometimes I think our house is a bit too big for two people. And their annual maintenance cost is more than we paid for our house.

And if you're thinking they learned a valuable lesson from this experience, think again.

They have not decided where to move next — just that it should be smaller.

“I would be happy with 3,500 square feet,” Mrs. Cheslock said.

“I would need 7,000 square feet,” said her husband.

He would NEED 7,000 square feet???

Stupid people are everywhere.

Real Estate: What You Get For.... $17,000

I've always joked that one way to distinguish the haves from the have nots is to determine whether someone seriously shops for real estate in the New York Times Sunday Magazine.

New York Times dot com also has a "Great Homes and Destinations" article which currently features "What You Can Get For... $700,000."

If I had $700,000 to spend on a house, it's unlikely I'd spend that amount unless I HAD to live in either New York, Los Angeles, or San Francisco. Since I don't (yet), it's not going to happen.

One of the houses in the NY Times article is a house here in Austin for $715,000.

...this house is about a 10-minute drive from the music night life on Sixth Street and the surrounding area in downtown Austin.

Does that 10-minute drive include rush-hour, and does it include time spent parking or is that more of a drop someone off at 6th Street and I-35 and let them walk? Hell, my house is 12-minutes from 6th Street in light traffic on a good day, and it won't cost you $700,000. In fact, I'd sell it to you for half that price, even after we put on the new roof and install new windows. (And I'd still have a big grin on my face all the way to the bank.) If the music scene is that important to you, my house is even a better deal. We've got aspiring musicians right behind us. No driving! Just walk over there and enjoy the show, or even enjoy it from the garden patio right here! What a deal!

Granted, the $700,000 house is a 2,901-square-foot four-bedroom three-and-a-half-bath contemporary. Mine is a bit less on the square-footage, with 3 bedrooms and 2 baths. Who the fuck wants to clean and maintain three-and-a-half bathrooms? I'd want them to knock about $300,000 off the asking price on that point alone.

...the garden has rock-scapes, palms, cactus and mature trees

Same here, minus the palms. Those aren't even native to this area. But we've got mature trees, more rock-scapes than you can count, and cacti out the ying-yang. And maybe even a larger lot.

Another reason I'd never pay $700,000 for a house in Texas. TAXES: $11,377 a year.
Christ, after five years of that you could have a pretty hot and sporty Mercedes-Benz fully loaded.

Or after about 18 months, you could plunk down cash on a house that many folks in this country might be thankful to have.

What You Get For...$17,000

$17,900 - 2 Bed 1 Bath in San Antonio.

OK, that's bit over budget but hell, I'm sure they'd negotiate. Not much space but comparable to many apartments. And you'd own it!

$17,900 - 3 Bed 1 Bath in Atlanta on 1/2 acre!

Plenty of room for gardening! And yes, the home does have a "sewer connected."

Prefer a life up north with snowy winters? Minnesota might be for you.

$15,000 - 3 Bed 1 Bath in Minneapolis.

This 1,123 square-foot home is a story and a half, and has a basement which I'm sure would function as a dandy wine cellar. This home is located just minutes from Nordstrom and other fine downtown shopping. Imagine the shopping spree you could have there with what you'd save on this real estate buy!

There you have it; some reasonable alternatives to the featured homes in the New York Times at a price you can probably afford.

About To Rip The Roof Off The Sucker

txrad and I are in a slight disagreement. We're about to replace the roof which is currently a brown shingle. Every house in the neighborhood has brown shingles. I want something that is going to make this house stand out and have major curb appeal just in case we need or want to sell it in the near future. And even if we don't, I want something I like even if it's not the top of the line roofing material I might select if I thought we'd be here forever.

Here are the choices. I'm going to reference them in order from left to right, top to bottom, as:
1,2
3,4
5,6
etc.

#4 is my favorite. Actually I like #5 but knowing how the color would pull in the Texas heat and txrad's aversion to that, I dismissed that choice immediately. I like #4 because it has green flecks which would tie in with the sage green I'd like to paint the wood siding on the backside of our house.

Now, keep in mind most of our siding is that yellowish-white Texas limestone and that's pretty much all you see from the street. Brown shingles just don't convey the look I'm after if I'm spending $6,600 based on the first estimate we've received.

My 2nd choice is #6 followed by #3 with those reddish tones. I think red tones look really cool with limestone but I'm trying to stick with the cool dark gray/greens.

All of these choices are the same price so that's not the issue other than the possible increase in cooling costs. And by my thinking, it might be offset by the decrease in heating costs in the winter? Aside from that, we keep our thermostat set at 83-ish in the summer and I doubt that's going to represent a huge difference in our electric bill.

txrad chose #2 and #8. That shouldn't come as a surprise to anyone who knows him. And yes, it might not absorb as much heat but it would look like cheap shit on this house, and in the event we do need to sell it, I don't want any downsides. And in the event we decide to keep it, I don't want to retch every time I come home from work.

No offense to anyone with similar colored roofing shingles. This is just my personal aesthetic trying to cover my personal ass.

Opinions are welcome, just be advised I am a Taurus and will probably do whatever the hell I think is right under the circumstances. This is our current roof although this picture is probably 5-6 years old. The front yard looks like shit now.

And the windows are about to be replaced. That's another $7k-$8k. $8,721 for single-hung from the same firm that gave us the roofing estimate. $9,322 for double-hung. I'm leaning towards double-hung.

Pontificate at your leisure.

Holy Shit! Is The Recession Over Already?

That was fast!

Some of the Yahoo features seem overly simplistic sometimes and intended to soften our fears and anxieties. This one via CNNMoney.com almost made me scream. What kind of drugs are these people taking?

NEW YORK (CNNMoney.com) -- It may be the best time to buy a house in more than four years.

Home prices have dropped so quickly and so far that valuations - the difference between what a home should cost and its actual price - are the lowest they've been since 2004, according to a report.

Since 2004? Really? Well, hot damn, maybe I'll just saddle up my pony and ride out and buy two then!

I really don't think my memory is so bad, but in 2004 I seem to recall we were in the midst of a real estate boom in which prices were skyrocketing. The fact that now things are back to the level they were then is not what I'd call the bargain of a century. I'm trying to remember what else was going on in 2004/2005... oh, I think that's when I was spending a lot of time watching the Suze Orman show in which she was constantly warning us about a likely housing bubble... back THEN.

"Housing valuations are almost back to long-term norms," said National City's chief economist, Richard DeKaser. He called current affordability "the best in the past four years."

But DeKaser cautioned that home prices could fall even further.

"This isn't to say home price declines are over," he said. "We could move below historic norms. By the end of 2008, housing markets could be broadly under valued."

I'm not telling anyone what to do. You want to go plop down a few hundred grand for a California cottage? Be my guest. Snag 'em while they're hot and there's easy credit.

Who needs drugs when we have reality such as this? Forget that. Have a second opinion and then sleep on it a few weeks.

"The break line of good to bad credit used to be a FICO [score] of 620," he explains. "Over the last year, it's moved to 650, then 680 and now it's starting to push over 700." Borrowers who have lower scores may have to come up with higher down payments, or settle for loans with higher fees or interest rates.

Getting a home with low or no money down, meanwhile, is a thing of the past. Lenders may even require more than the traditional 20% in markets that are especially hard-hit.

That is disturbing news in and of itself as it will eliminate many people from the housing market who previously might have been able to swing a deal. And foreclosures?

Foreclosures are touted as great deals (especially by services that sell foreclosure listings). In some areas, real estate agents have even started taking potential buyers on "foreclosure tours."

In reality, however, buying a foreclosed property — or even one in a neighborhood plagued by foreclosures — is risky. "A heavy concentration of foreclosures indicates that there's some sort of economic problem in the region that will keep your home value from at least remaining stable," says Miller. "Or that there was some speculation and there may still be some air left to come out of that market."

This show ain't over yet folks, so sit yer asses down and enjoy the spectacle.

Kona Wants a Second Ranch

From the time I was a child I have dreamed of someday having my own chunk of land. I attribute this to the fact that I grew up on a 500 acre farm at the end of a gravel road. I like the seclusion and yet we were only 3 miles from a town.

Most importantly, I like the option of having a self-sustaining lifestyle if I ever choose to go that route. txrad and I also need to be able to till the soil and have a large garden. Now comes the hard part.

Coastal regions and other low elevations are out. If and when Florida and Louisiana become submerged, what's that going to do to other areas of the country with major rivers feeding into the Gulf of Mexico?

I also want the land to connect with me on some spiritual level. A broad flat wide open space is beautiful in a way, but it doesn't really tug at my soul. Unless of course I could have 5,000 acres of it and then I might reconsider. Unfortunately that's a bit out of my budget.

Aside from some ugly personal debt related to loans I made to my failed business which also has a mountain of debt and with that corporation facing possible bankruptcy, things have never been better. Even with that ugly dark cloud looming over me constantly, I feel pretty damn good about life right now. I may never have a better opportunity to pursue my dream.

We are fortunate to be gainfully employed and drawing a combined income which exceeds any previous employment and I am socking away a good amount of money from each pay period. What's tricky is we have no idea how long this will last. So I have set a savings goal by the end of the year which is reasonable and I'm confident our employment will at least continue into early spring 2008 at least.

I have done a search of properties in four states for five or more acres of land within my budget. My ideal would be at least 10-20 acres, and more if possible. My ideal price is $25,000 or less, although I could go into the $40,000-$45,000 range by liquidating some stocks.

We have no immediate plans to build on the property; I just want to own it as a security blanket while I have the opportunity, and it's there when we decide to undergo a major lifestyle change, or we're forced to for whatever reason.

So, here are a few options. First, here's an example of what I'm not wanting:

I really want some contrast, some hills or mountains to lend some character.

Arizona

39 acres in Snowflake for $25,000. Beautiful, the right price, and a good chunk of real estate. I'm sure the nearby towns offer some amenities, but it's a 175 mile trek to Phoenix and 200 to Tucson.

New Mexico

5 acres in Tierra Amarilla for $8,000. The acreage isn't much but for $8,000, it's something. And the remainder of my savings could be used for something else.

In the same area is this plot: 10 acres for $35,000. Twice the land, much more beautiful, but creeping to the top end of my price range. The area is roughly 80 miles from Taos and 90 miles from Santa Fe.

Another beauty is this one in Chama near the Colorado border. It's 10 acres with power for $42,000. The Chama area is a bit over 100 miles to Santa Fe.

Colorado

This state isn't really my top choice. The politics aren't really to my liking. But for the price of the land and the beauty, I'll include it.

For $30,000 this is 35 acres and a nice view, with utilities "nearby."

I like this one even better. It almost qualifies as a "sweeping vista" or a "million dollar view." What's more, electricity is available "nearby." It's a 40 acre plot for $25,000. There must be some string attached -- as in the photograph is just the area and not taken from the actual property being sold.

As with the Arizona property, it's quite a haul to any major cities although there are some decent size towns in the area of southern Colorado. Pueblo is about 135 miles and Colorado Springs is closer to 185, as if I'd ever want to set foot in that evangelical Republican hellpit.

Arkansas

Property here has the advantage of being closer to a city than most of the previous ones, and also have utilities present. Unfortunately, Heber Springs is a hot area due to nearby lakes and attractiveness as a retirement area, so you don't get so much land for your dollar. But it's nice. And only about 65 miles from Little Rock.

Here's 5 acres for $30,000:

Another 5 acres for $32,000 with a very nice view:

A bit farther north in Mountain View, this 5.6 acre parcel can be had for around $14,000. I like! It's about 105 miles from Little Rock.

Feel free to comment with your opinions, advice, whatever. Call me crazy if you so desire.