Thursday, July 3, 2008

Fire Sale in Belmont!

804 Meridian Street - MLS #455035
2 Bed, 1 Bath
Sq. Ft: 728

For Sale: Eight Cottages: 800, 804, 806, 808 Meridian Street and 910, 912, 914, 916 Bolling Avenue in Belmont. One owner. These new listings are to be sold individually or as a group to an optimistic investor. The listing description is simple: "Starter Home."

But we're kidding about the Fire Sale, because these babies ain't cheap: they range in price from $190K to $220K, or about $260.00 - $300.00 per square foot (avg. 730 sq ft.).

912 Bolling Avenue - MLS #455034
$193, 200.00
2 Bed, 1 Bath
Sq. Ft: 728

Using the US Bank Mortgage Calculator, we figured the actual cost of one of the $220K properties:

Loan amount - $213,400.00 (97% LTV mortgages are still available and many C'ville RE blogs mention! this! often!)
Term of loan - 30 years
Interest rate - 6.4 % (typical this week)
Monthly payment - $1,334.83
Total interest
- $267,138.10 (More than price of house)
Total payments - $480,538.10 (In other words, A Half Million Dollars)

You've read our post about a similarly-priced cottage over at 903 Rougemont Avenue. We could go on about neighborhood, current down market, magic numbers, economy, and add editorial. Instead, we're just listening.


Cathy said...

When my husband and I first moved to C'ville we heard about Belmont. The first thing I noticed was, despite the hip reputation ("young architects are moving in!!!"), the housing stock was horrible. To put money into any of these houses seemed questionable. It would still be a bungalow with no insulation. Generally, when artists come in an revive a neighborhood, it makes sense when the original buildings are worth something. But, although there are about 3 square blocks of Belmont that are superficially "charming," there is no there there for us. If it had great schools, you could perhaps persuade us. But, these young couples with babies will move out when their kids are school age OR they will send them to private school.

Montpellier said...

I think Belmont will ultimately do better - I agree with you about the housing stock - it's terrible, and really not worth re-doing.

The location, however, is pretty good, and for that reason, I think in the long run Belmont will become popular for tear-downs. The lots are small, but the days of >.5ac. lots in the exurbs are coming to a close. Some of the larger, high-density Arts & Crafts (Craftsman?) style homes which have appeared elsewhere in the city as in-fill development (eg, Robinson Woods, the two cul-de-sacs off Madison between Rose Hill and Meadow) would be viable in Belmont.

I think the schools might turn around - the school quality is less a function of the CCS Central Office than of the neighborhood demographics which go into the school. I believe the same transportation costs will drive a better student demographic back into the schools.

James said...

These prices are OBSCENE.

And in this market? Search the MLS and you can find a brick rancher twice the size for 30 thou more asking.


cville seer said...

it's probably some poor old lady who owns these cottages. bought them b/c her "help" didn't have a decent place to live.

now she's being forced off the farmette into a retirement community and Chip and Tres want to settle her affairs and get some $ into their inheritance

what other scenario would explain putting these places into a depressed market at inflated prices. its all troubling.

Montpellier said...

I ought to clarify: ultimately==25 years

It will be ages and ages before this area becomes attractive for tear-downs.

brooklyn bob said...

Thanks for clarifying, Montpellier! Thought you'd gone soft on us.

Part of the 'ultimately' = the nationwide economy stabilizing, and Charlottesville becoming a viable area for the 'middle classes' to live in....

Uh oh. We all might be speaking Cantonese (or Mandarin, since Charlottesville is a "protected market") before this happens.

Anonymous said...

Drove by to check these out. Bleak.

They need "Affordable Again!" signs.

And eventually at least one will have a "Bob did it again!" sign.

That guy has a knack for selling the little houses.

Anonymous said...

These properties have been on the rental market for many many years. As a result they have not been cared for as they might have been if they were occupied by owner-residents. What this means for potential buyers is that each property should be inspected closely for inefficient furnaces, corroded (and therefore clogged) pipes, poor electrical wiring, unsealed basements, stuck windows, broken hinges, and other aesthetic related issues like the need for new paint throughout, new carpet or kitchen flooring and/or refinishing of the wood floors. Look carefully for shortcutted repair jobs on things like plumbing and electrical. Remember that none of these properties have central air, or appliances. To outfit each house with fridge/stove/W/D, you’re looking at a few thousand dollars. Add to that, for example, the potential cost of excavating the entire front yard to stop rain water from flooding into the basement, and you’ve added, what (can any contractor out there give a reasonable estimate for that kind of work?) $10+K (?).

These houses are a great example of the kind of property (at least in terms of size and condition) that should be “affordable” for all types of people with below-median incomes in this city – and while they are listed at or near tax assessment values, James is right that the prices are obscene. So, they start at ~$200K, add to that the $5K to $25K+ of work & upgrades that are needed, and you’re looking at a mortgage of well over $1,400 per month (as the original post indicated). If you keep with a recommended housing expense of 30% or less of gross income, you’re asking a very small family or individual with gross annual income of over $55,000 (which I would note is well over the median income for City residents) to move into these very small houses.


The Myth of Homeownership said...

And you know what? Think about who makes 55thou/year in C'ville. It's people who work at SNL, it's youngish lawyers, it's other young professionals, it's a lot of people who are staff at UVa.

Why would they want to live in these down-market places?

And if these properties are aimed at the population with median income here in C'ville, or a "minority" population open to further subsidies? Anonymous is right--too much money for them--and inadvisable, because it's not a prudent investment.

Anonymous said...

No air conditioning, 728sq ft, $215000, and asbestos siding. Where do I sign?

Anonymous said...

And don't forget about the flooding basements! :)