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home ownership and paying off sister - Page 2

post #31 of 40
7/21/05 at 2:49pm
What he spent on the renovations is meaningless...Who's to say that the renovations are worth exactly what he paid (either higher or lower)? What if he got $40K worth of renovations for $15K? That means the pre-renovated house is only worth $140K.

In this case, $140K - $40K = $100K
sis only gets $50K


Actually, here's a REAL world example:
A friend of mine was trying to sell her home for $250K. She had a HARD time selling it for that much and they were saying it was worth more like $220-230K. The big reason was she only had 1 bathroom. She had a toilet downstairs in a corner, but it wasn't considered a "half bath" - The real estate agent told her, if she were to wall the toilet in, it would THEN be considered a half bath and she'd have no problem asking $250K.

Now I hardly think it would cost $30K to put up a couple of walls. So the few $$ it costs to make it a half bath, would have made it's worth go up like $30K.
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post #32 of 40
7/21/05 at 2:55pm
The difference is a potential of the house. To be attributed to both owners of the property.

In your example, the buyer could have done that renovation him/herself. So why would he/she ever pay more than the amount it cost to change that?

Stupidity of the market, perhaps, but that's not a point if you're the buyer yourself and dealing with family, like in this case.

And we even don't know if this situation exists here. So why just introduce another topic of arguments, instead of keeping it clear and clean?


Cees
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post #33 of 40
7/21/05 at 7:15pm
Quote:
In your example, the buyer could have done that renovation him/herself. So why would he/she ever pay more than the amount it cost to change that?

Stupidity of the market, perhaps, but that's not a point if you're the buyer yourself and dealing with family, like in this case.

Reminds me of a curiousity of the Engish property market I was introduced to: I was staying with a friend who owned a flat in London, and the guest bathroom's sink had the typical English two-tap set up (one hot, one cold), which is IMO a PITA and impractical. She'd hooked up an attachment of tubing to the two taps that took the output of both taps and mixed them to a single output -- in effect a temporary mixer.

I asked why she didn't simply install a proper mixer, as most of us in this country would have. She told me the property agent told her that it would make the property more difficult to sell in future (which she probably would in future when she and hubby pack it up there and return home to Singapore).

The weird thing is, just how much would it have cost a future buyer to change a mixer back to two taps if they really wanted it (even though IMO it's an archaic and impractical setup)? OK, then again plumber's charges are notoriously high...
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post #34 of 40
7/21/05 at 9:47pm
Thread Starter 
It's over and the deal was accepted after a couple of hours of going round and round. Interest was tacked on retroactive from the time she moved out and the money will be wired to her account next week. Everyone is satisfied and relieved it's over. Thank God!!!
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post #35 of 40
7/21/05 at 9:56pm
And you're still married too? Good job man!
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post #36 of 40
7/22/05 at 12:50am
Congratulations, Donnie!


Cees
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post #37 of 40
7/22/05 at 5:24am
Quote:
Everyone is satisfied

This was the most important outcome. Congratulations on working things out to everyone's satisfaction, Donnie.
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post #38 of 40
7/22/05 at 6:46am
Not going to tell us who was closer as to the final closing costs?

- Colton
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post #39 of 40
7/22/05 at 7:19am
Congrats on the deal Donnie.

Now that it's done, I'll continue what I brought up before without feeling like I'm derailing the thread
Quote:
In your example, the buyer could have done that renovation him/herself. So why would he/she ever pay more than the amount it cost to change that?
Because that's the difference between a home with 1 bath as opposed to a home with 1 and a half baths. That's how the market is.
Quote:
but that's not a point if you're the buyer yourself and dealing with family, like in this case.
But you do need to keep that in mind if you are basing your deal on the appraisal? Or am I missing something with appraisals? Isn't an appraisal based on what the market will pay? With my example, people are willing to pay more for a home with 1 and a half baths. It's so much so (at least around here) that homes with only 1 bath are extremely difficult to sell. So those two extra walls = 'big' bucks when selling.
Quote:
She told me the property agent told her that it would make the property more difficult to sell in future
Oh my god! My brother said the same thing to me when I painted my condo walls. He kept saying "It's gonna be harder to sell it in the future if the buyer doesn't like the color" Like I'm going to stick with white walls because I'm worried about selling (years down the road).
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post #40 of 40
7/24/05 at 7:45pm
Quote:
My brother said the same thing to me when I painted my condo walls. He kept saying "It's gonna be harder to sell it in the future if the buyer doesn't like the color"

Heh. As if any buyer is going to keep the place in "original condition", first thing most buyers do is do major renovations on the place anyway. But I guess the problem is one of first impressions, if they don't like the way it looks, even if they're planning to renovate, the buyers don't get a good feel for the place, or will want to push down the asking price.
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