Thursday, September 6, 2007

K is for Knock-down

So, Bunky, life got you down? Are they building "McMansions" on your street? Do you have the smallest house in your neighborhood? Do you think it's time you sold your older home?

Let's look at this a little deeper.

First, if this is the situation, your house would probably be considered a knock-down or tear-down. If it is, then you need to look at your house in a completely different way. Condition means nothing. Curb appeal, staging, other regular factors get shown the door. Land value starts to be the single most important consideration. The other consideration is the cost of removing your house, and possibly the value of any parts that are left.

Yep.

There is a home not far from me that is a modest 1970s ranch. It sits next to several brand new homes that are in the $600k range. When the owner of the older home put it up for sale, he thought he was going to get a 40% premium because of the other homes...

Nope.

In fact, his home has lost value. Fewer people would consider buying the home to live in because it doesn't fit the character of its surroundings anymore. So, what was once a nice $140k home is now a $75k, 1/2 acre lot. It certainly isn't a $200k property.

That is the downside of infill.

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