Sunday, August 07, 2005

Surreal Estate

I always used to be amused, reading of real estate values in New York, Toyko, California and other "hot spots". A million for a condo? $300,000 for a tear-down? Land worth $100 a square foot? It could never happen here, I chuckled.
I'm not laughing anymore. The boom has hit smalltown USA, with double digit increases in value for each of the last ten years, and even higher raises in some markets. Shacks in my town that were going for 70K only a few years ago are up over 150K. These are not humble "starter homes", these are places that should be torn down, and indeed, some with large lots have been, replaced with income property. Nice homes, nothing special, are all over $200,000. With low rate thirty (or forty) year loans available, everybody is going nuts. Condos in the trendy warehouse district have association fees of nearly $1000 a month. I used to live in the run-down warehouse district for $80 a month. Oh well, times change, and it will all work out, I suppose. When the North Star Train Corridor opens in a few years, the station will be a few blocks from my house. Hang on tight, it's going to be a wild ride.

By Professor Batty


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