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Unpleasant Surprises for Online Real Estate Buyers
prostoalex writes "Buying expensive items online from the people you've never met without any guarantees on the seller's part might seem a bit risky even for an experienced Internet shopper. The 'hotness' of the real estate investment market apparently influences some cash-heavy investors to look for opportunities online. When the entire transaction is done via a click of the mouse, and the deed for newly bought real estate arrives in the mail, some unsuspecting buyers might discover that a cozy house near the bus line in the middle of a busy street might imply a criminalized neighborhood and proximity to crack house. The New York Times investigates negative experiences of people buying investment real estate online."
Even a picture isnt enough-- there was a house in our neighborhood where the owner kept over 100 rabbits. With free run of the place. The house looked okay from the outside, maybe worth $260,000. But my friend the real-estate appraiser valued it at -$22000. That's how much it would cost to tear down the house, minus the value of the land.
Yeah that would not be so good to have a house on a busy street next to a crack house...or a brothel...or a bar...or anything else other than a house.
Damn right. In fact, any money spent online that doesn't go to well-established companies should always be money that you are willing to lose. There's never any guarantees about ebay sellers unless they have exceptional feedback for a LOT of auctions. (some dodgy sellers may "sell items" to friends to get positive feedback, before scamming other people)
Of course, some people deserve to lose their money more than others. I have far more sympathy for the bloke that lost $50 in a dodgy ebay auction than I do for someone who purchased property online without having seen it.
By CAUCASIAN, I assume you mean the typical neo-Nazi WASP credential -- in which case I would argue that you are wrong. I worked for a city development office that put out about a 100+ 8-1/2x11 book on neighborhood crime statistics. When we moved to Baltimore, one of the first things I did was go to the city hall and ask for a similar set of stats on their neighborhoods. They looked at me like I was a martian, or at least a leftist agitator, so, in a moment of inspiration, I asked where the Jewish neighborhoods were. THAT they knew. Haven't regretted it. And in the subsequent move to our current city we did the same thing. It's great. We can watch the crime on TV from both the inner city _and_ the exurban white welfare meth lab trailer parks and apartment complex suburbs. In contrast, our very much inside-the-beltway, but not "inner" city, neighborhood public school has the highest test scores in the state.
So do Jews count as CAUCASIAN in your equation, Dudster?
> This really surprises anyone? I thought terms like "ideal for a DYIer!" have always meant "about to collapse" ?
It surprises many people. There are plenty of people who, when faced by something that looks like a bargain, or looks like they're getting a good deal & ripping off the buyer will jump at a business chance without thinking things through, because the scammer has successfully planted an image in the buyer/victim's own mind. Imaginations are a powerful thing, and work against the victim.
A relative of mine (no relation apart from by marriage) came across his first nigerian scammer email a couple of years ago. He spent days thinking over the options and planning how to rip nigerianscammerguy off of all his money, instead of just getting 10% of the $50million promised.
I gave the guy a handy hint, advised him it's a scam and these guys will just try to take money from him and keep promising but never delivering. That's when he said he knew it must be a scam, and unveiled some 'foolproof' plan to get the money from the nigerianscammerguy but not reveal who he was or send them much money at all.
Eventually, he ended up losing about $2500 to the scammers getting played right into their game. Why? While he knew it was a scam, he made the stupid mistake of believing the $50 million actually existed. It clouded his vision, and all he could see was a mental image of his bank statement with 7 digits in the black. Same with real estate, the buyers make an image in their mind of what they're buying, and don't lose it - even buyers of property who get to inspect it will see what they want to, unless there are major differences between description and reality.
If you want to get a good overview of what you are buying, try typing the address in Google Earth and then see what lies around it.
He who knows best knows how little he knows. - Thomas Jefferson
> I can't even contemplate how the US will ever work its way out recession that
> follows
Stop buying expensive crap and learn to live happily and simply? I'm just guessing, but I doubt people from rich countries are any happier than people from poor countries. It doesn't cost much to survive in beautiful places like South Thailand, and it costs a fortune to live in stinky, dirty, crime-ridden London or New York. When did you ever go somewhere beautiful and see photos of cities with the slogan "get away from it all - go to London", for instance?
But, no one has suggested using Google maps/earth. That's what I would do even if I were buying locally.
I was once on a trainging flight and as I passed over this really expensive neighborhood, I saw a quarry not more than a few hundred yards away, tucked in a very heavily forested area. I'm sure after they spent mega$$ on their McMansions, they were probably surprised by the blasting and all of the trucks going by.
Now, I'd make sure there wasn't any surprises like that if I were buying a home.
Saturday is April 1. Slashdot will be shut down. Sorry for the inconvenience.
If it had been contaminated with toxic waste (e.g. from a meth lab), he could have ended up owing thousands or millions to the government for clean up costs.
Some online real estate deals are, for the most part, safe.
For example, wilderness purchases if you should have the inclination to build a getaway cabin. Granted, there are no structures most of the time, it's just the land.
Another example would be buying fringe properties. If you believe that a company or a city will eventually want to expand into a particular area, you might want to buy the land if you have the chance to get in early enough. You would have to look out for potential immenent domain problems though. A friend of mine inherited basically a huge field when his parents died in a small town in central Arizona. About 3 years ago, some company wanted to build a retirement village with a golf course. They paid him 7 Million for a stupid field. Sweet!
Other potential online purchases would be castles. Yes, that's right, castles. There are dozens and dozens of mansions and castles that sit in what was formerly East Germany. The original owners have simply abandoned them and the local authorities auction off the properties. Many times they go relatively cheap, like a couple thousand dollars cheap, if you don't mind the renovation costs. They can make great vacation spots or quiet retirement villas.
Just out of curiosity, I cruised over to ebay and searched for real estate in Buffalo. Surprise, surprise, a 'Mr. Burt' is listing a fixer upper for a very low price. Coincidence? I don't think so. I was going to insert something here about not buying sight unseen, but then I sat back and thought about it and realized that I might very well have done the same thing. Dropping 3K to own a bit of real estate doesn't seem like a bad flyer. How bad could you get hurt? This was actually a wake up call for me.
No, just the one word was right. Jobs. I have lived in Boston and the San Francisco Bay area and Buffalo is where I prefer... if you can get a good job. Perfect quality of life and climate (the snow is no big deal, not much different from when I grew up in Boston, and besides, it makes for great skiing). And as the article indirectly points out, real estate is very cheap. While only a fool would buy a house sight unseen in the East Side, my half acre lot with a beautiful ranch house and mature trees in an idyllic walkable community is only about $140,000 according to the bank. Of course, the reason things are so cheap is because of the lack of jobs.
I like to have people repeat the snow boogieman line, though. It helps keep the riff raff out!
Still .. beautiful plumage!
One line blog. I hear that they're called Twitters now.
"Diversity" means one thing : CRIME and WELFARE
Interesting that you put "diversity" in quotes.
When we moved to our current apartment my wife looked up some crime stats for various neighborhoods.
With 100 as the national average:
Some areas of Newark, NJ were 400 or more.
The small town where I went to high school (about 2000 pop, 50 miles from nearest Mc Donald's) was about 25 or so, IIRC. The town has significant Mexican (ex-pat) and Navajo populations.
The town where our apartment is, rated 4. That's right, single digit, 4.
This is the most diverse place I've ever lived, or visited. On my short block (duplexes and single-family homes) there are at least 6 native languages.
My daughter's first grade class had a variety of Christians along with Jews, Muslims, Buddists, and I don't know what religion the kid from Mongolia follows. The school has maybe 20 students that would qualify for free or reduced school lunch.
When I'm in church on Sunday I talk to people from Nigeria, Jamaica, Haiti, Mexico, Chile, Peru, Germany, Philipines, Eastern Europe, etc.
We happened to drive through one of those very high crime areas of Newark and my daughter had a question. "Why is everyone the same color?"
Result: In my (perhaps not statistically significant experience) it is the lack of diversity that has a positive correlation with crime and welfare. So, I think it's interesting that you put "diversity" in quotes.
The trouble is that I doubt that I'll ever be able to afford to buy a home in the town where I live.
Exam 4/C again. Maybe I'll do better this time.
However my aunt is a real estate agent and after a few years of flying cross-country for vacations wondered if her investment money wouldn't be more productive elsewhere. So almost on a lark she listed on an online auction site, no commitment to sell. And the bidding went insane!
So she called up Mom, confessed what she had done, then agreed that if the silly numbers were true they'd sell. They ended up having a prospective buyer fly up from Texas and stay in the house for a few days. The buyer loved the place, made an offer that was jaw-dropping by local real estate values, and the place was sold.
However, the buyer was from Texas, i.e. a US citizen. This hadn't been an issue for my mother, after 40-some years in the US she has always remained Canadian, but they did warn the buyer they'd have to look into local laws, particularly as they were dog-breeders and planning to use the barns for kennels, etc.
(By the way, Nova Scotia is cheap and trying hard to make itself attractive to retirees; if you're looking for a vacation place or to retire it's a great place to consider!)
Anyway, within a few years the new buyer had to sell. They'd not done their homework and had instead simply moved and started selling dogs. Apparently when informed they'd have to leave the country and immigrate the legal way they didn't find a peer online to sell the house to and instead sold at a rate far more in keeping with the local norms, and thus took a complete bath on the whole process.
So my family had a GREAT experience, others might not do so well...
Oh, and there's my buddy Richard, who buys a new eMachine PC on sale every year, images it's drive, pulls out and replaces the parts he doesn't care for, then a year later sets it back up the way he got it and sells it online, every time for more then he'd bought it for a year earlier! There really is another sucker online every minute!
I don't read ACs: If a post isn't worth so much as a nom de plume to its author then I wont bother either.