Friday, April 1, 2011

Stigmatized Properties

Japan is still shaking.  I subscribe to the USGS in order to receive notifications regarding earthquakes that occur all over the world exceeding 5.0Mw.  Since the 9.0 quake of March 11 just off the coast of Northern Japan, I've been getting a steady stream of emails.  During the past week in the same area of Japan, 103 quakes registered 4.0 or more.  Of these 27 were at least 5.0 and five of them registered over 6.0Mw.  Earthquakes and Tsunami's have caused extensive damage and left an estimated 300,000 people homeless.  A third of this number is reported to be children. 

But it's the nuclear fallout that is capturing the worlds attention lately.  Everyone is watching (and measuring) events unfold at the Fukushima facility.  And, they're asking questions.  What about here?  Could it happen?  What if it did? 

How close do you live to a nuclear facility?  What impact will that have on your ability to sell?  If you were looking to purchase, what weight will you give to the location of the nearest nuclear facility?

The experts say (Reuters, March 18) that it will certainly impact value for the near future based on the information available today.  Depending on the eventual outcome of the crisis in Japan, it could be significantly longer especially in areas  near earthquake fault lines.  There are also a number of experts saying that buyer concern will eventually subside in a manner similar to the 3-Mile Island accident in Pennsylvania 32 years ago.  The "experts" don't agree. I guess time will tell, then.

Nuclear facilities are not the only properties which have been stigmatized.  Typically a stigmatized property is somewhat notorious for one reason or another.  A good description is found at Wikipedia if you need further information. 

One of these "stigmatized" properties has recently seen the news again.  Remember the murder of 6-year old JonBenet Ramsey in 1996?  The 7,000+ square foot Boulder, CO family home was originally purchased for $500,000 in 1991.  A sale to investors in 1998 for $650,000 was intended to be "flipped" in order to provide funding for the JonBenet Ramsey Children's Foundation. A sale took nearly 6 years at which time an agreement was reached for a little over $1M.  Today, it is again on the market with an asking price of $2.3M after a couple of recent attempts to sell above and below that price. For those of a curious nature, the new listing can be found on Zillow.

It's uncomfortable to write about this topic.  We're talking about horrific events in the lives of many Japanese people along with the death of a 6 year old child.  And we're relating these things to the cost of real estate.  It's VERY uncomfortable and seemingly disrespectful.  Sensibilities are offended here - mine as well.  But in real life, there will be situations that demand scrutiny even under such deplorable circumstances.

If you're facing the situation of needing to sell (I almost said "distance yourself" - whitewash!) a property viewed as stigmatized for whatever reason, make sure you're working with a real estate agent who is patient, creative, and can be fully empathetic with you during the process.  It will be difficult and painful.  Call us and we will find that person for you.  We promise to be caring and empathetic as well.

Housekeeping:

SPENT
Well, playing SPENT apparently wasn't something very many people wanted to do - or maybe they just didn't want to record their results here :-)  There were only 9 people who "shared".  78% of the respondents recorded less than $100 at the end of the exercise. The other recorded responses show 11% each for the $100-$300 category and for the $600-$900 bracket.  Suffice to say, most of us did poorly.  If you didn't have a chance to see how you might react to the challenges of being without a job and without a home, I'd still encourage you to give it a try. 

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NEXT POST:  Nonprofit Contestants. And, exactly HOW does this "Referral" thing work, anyway?

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