Monday, July 21, 2008

Greedy People

Last night I was watching a show on HGTV. Yes I know, let the mocking begin. It was one of those shows that I love to hate. It was one of those shows that, though not intended to do so, shows the worst in people. It was a show that illustrated the proud, selfish, and greedy nature of people that might otherwise be described as compassionate, friendly, or even generous. Was this an “E! True Hollywood Story”? How about a “Fabulous Life” of someone who makes more money than most of us will ever count show on VH1? Well, it’s clearly none of those, and if you recall the first sentence, you know that already. This was “My House Is Worth What?” on HGTV.

Real estate shows are all the rage these days. There are at least a dozen on different channels right now, and they’re all about the same. Someone bought a house, fixed it up, wants to sell, and ultimately wants to much money for it. Maybe I am a little bit partial because I’ve worked in the field for so long. But I’ll present the facts as honestly as I can.

The facts of the matter: A couple purchased a house on Tybee Island in Georgia. They picked it up dirt-cheap for $150k. They have been in it now for a number of years, but not quite 10. They put $125k into making the house what they wanted it to be. Now they want to sell it and buy something bigger. They think their house is worth every single penny of $850k.

The facts as seen by a realtor in the area: The couple made many impressive upgrades to a home that is now in great condition and has a location that can’t be beaten. However, there are a few things that they overlooked in their rehab process in the forms of two of the most cost recovered investments in the forms of the kitchen and the bathrooms. For the record, the best investment to make in terms of cost recovery is anything that adds useable living space. But they didn’t add space, and they kitchen and bathrooms, while nice, were not consistent with an $800k plus home.

The result: The agent looked over their home, did an analysis of the surrounding community, and gave a professional opinion of price. He said that he would have listed their home then and there for $775k. They were immediately insulted. With no experience as real estate professionals they just knew their house was worth more and this guy had to be off his rocker. They were talking about a return of around $500k. Yeah, that’s half a mil for those playing along at home. And it just wasn’t enough for them.

All these shows have people who want too much for too little and refuse to budge an inch. You want to see the absoulte worst in a person? Skip the shows about the drunk celebutants throwing money everywhere and having public temper tantrums. Just watch a show about people selling a house!

The “professional house flipper” shows are the worst. No one knows how much a house should sell for compared to how much they bought it for. No one knows how to make a schedule. And no one can keep a budget worth a damn. What happens to the homes and the people that sank their heart, soul, and savings into them? They all end the same way; with an exit interview where a pissed off, greedy, wannabe “investor” ends up living full time in a house they meant to flip.

Strong work.

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