Attached
Posted on September 17, 2008 - Filed Under Business |
I guess my brain just thinks differently.
Finally, some feedback from a potential buyer. He and his son spent about an hour with my property. Forty minutes were spent looking around, twenty were spent sitting in their parked car. Their topic of discussion: should we go for this house?
In the end, they decided no.
They decided to let their offer go through on a place north of my area, about 1/3 of the size and in crappy condition. So what’s the difference between this income producing property and the cardboard box they are buying?
It’s the garage. Or lack of. People do enjoy the house, think it’s absolutely great. But they are looking for a garage. I confirmed this with the real estate agent, who fields the questions from other agents. Their first question is about the garage. Or lack of. To his credit, he does convince them to come out and at least look at the property. But that’s as far as it goes.
Even if I had the capital to get a 2 car garage built, I don’t think it would be worth it. I couldn’t ask for $25,000 more on the price just because it has a garage. Properties just aren’t selling for that high in my area. And with the market flooded with bank repos, most with garages, it’s hard to compete.
But it’s nice to get some sort of feedback.
Incidentally it’s the same question that potential tenants would ask about when calling on the phone.
Maybe on the next purchase, I’m going to have to consider the garage aspect of a property. I would have never thought that having an enclosed parking space would be that important but apparently it is.
If you liked that post, then try these...
Increasing Property Value on November 7th, 2007
The appraiser is coming soon.
Positive Impact Policy on June 2nd, 2008
I am glad the web project got revisited.
Comments
5 Responses to “Attached”
Leave a Reply
Why do they want the garage? Do they want somewhere secure to lock their car up in, something to shade their car from the sun, or somewhere to put their junk? The sunshade could be a cheaper solution - some carport thing - but no use if that isn’t what people are looking for.
Or do they want a lower price due to no garage as they’ll have to build it themselves? From what you say it seems there is room to do so.
mooms last blog post..Halfway Through the Buffer
@moom: Actually it’s both. Either a secure place to lock their car or a secure place to store their stuff. Since the attic in the house is huge, I’m guessing it’s for their car.
There is spot where we could put a 2 car garage and, with a few dollars more, another one bedroom apartment on top. But the garage wouldn’t be attached which would be another issue altogether.
Is it really $25,000 for a garage? Seems like alot.
Kenrics last blog post..Update on Apartment #1
@Kenric: I have no idea. I was told we could get away with one for $20,000. I still don’t think in this market that I would recoup the cost.
I recall reading in one of the Rich Dad books about real estate that mentioned this subject exactly. This one was written by a real estate buddy of Kiyosaki, Dolph Larouix(sp). This was written when the market was a much different one from today.
The scenario he was painting was how to increase the value of a property quickly in order to refinance and get more money out of the property to invest in your next project. He tells you what to look for in a property to purchase and the comparables in the area. If there are other properties with car ports or garages and you can get one that doesn’t have one, you can put one in and increase the value of the property quickly.
Again, this market probably doesn’t support that theory any longer, but in 2 - 5 years, we could be back there again…