D

Do Land Leases Have Anything To Do With Texas Gold?

Tim posted a question on FB asking if, when the land leases on NorthPark Center  expire, the owner of the lease gets to keep the improvements — i.e. NorthPark. Then he got his answer: no. But it was a great question: I wonder how many people know that many major developments are erected on dirt not necessarily owned by the developer or the person who owns the improvement? In Mexico, for example, until very recently foreigners who bought homes there owned the structure but leased the land from the state. (Beach property is still available in Mexico only as a land lease.) Usually the land leases are extended, sometimes they actually run out at which point the developer/owner can negotiate to buy the dirt. This happened to a developer friend recently who bought a condo in California on a land lease — the lease was up sooner than he realized and all the owners had to scramble to fork over several thousand dollars to buy out their dirt landlord, an Indian tribe.  I am curious as to the origins of this and wonder if it has anything to do with oil? Do property owners like to hang onto dirt just in case of a Spindletop? Couldn’t that be done by maintaining the mineral rights?

Re-Fi SOS

A reader writes:

“If we missed out on the 4.5% refi rates, have we basically missed the boat?  What would make it worth it now to still refi?”

Good question, we’ll find an expert and try to get you some answers!

Could TRCC Dismantle Lead To Higher Building Costs?

Many consumer groups felt the TRCC was so builder-friendly,  it just gave victims an even bigger nightmare. But builders say letting everyone duke it out in court will  lead to higher costs for everyone. So who should regulate the home building industry: the state or the courts?

More Troubles For Highland Capital

$745 million more in troubles. Meantime, here are the homes for sale in Dallas that I am told by sources are backed by James Dondero, one head of the firm — each home appears to be it’s own limited liability partnership: 3500 Beverly, 4223 Bordeaux, 4041 Grassmere . These are exquisitely built and designed by Andrew Merrick Custom Homes, just waiting to be loved by a homebuyer.

Deal Of The Week/House Porn: Musing In The Meadows

Dealbook Deluxe: 2008 list price: $515,000, now $379,000. Located in the Meadows, a couple streets south of the home where the Geis tragedy took place, the neighborhood is getting very hot and the home has true sixties sensibilities. Not that I’m trippin’ or anything, but I can see Twiggy in her micro-mini, hear the psychedelic music on the intercom. Memories of avocado and orange-shagadelic carpet whisper from the walls. This street was the 1963 Parade of Homes. What may be keeping her from being a bride: four levels, backs to Walnut Hill Lane, outdated kitchen, grandmotherly knick knacks. Let’s think outside the box here: the knick knacks can go to the Salvation Army and net you a nice deduction, plant some junipers across the rear yard fence, and go get some granite asap. There — any other questions?

Sanity Check: Property Taxes Levied By Developers?

I think this shocks me about as much as Nadya Suleman. I met with a property tax buster yesterday, who tells me that given the way the appraisal district raised appraisals this year coupled with the bleeding housing market, he thinks DCAD had better plan on valet parking come May.

The North Central Expressway Submarket = Sexy

This area, east of Central on Walnut Hill to Greenville Ave., then down to Park Lane, fascinates me and, yes, rather turns me on. Talking real estate. So THR is leasing out one of its buildings, the apartments have been raised and a lot of stuff is going on — tell me more.  

Topless Bar SuperCenter: Could It Impact Dallas Property Values?

Other than contributing to the bottom line of local plastic surgeons, I saw this story about Rick’s Cabaret,  the state’s largest topless bar , en route to Dallas and wondered how this might impact Dallas property values? Particularly Victory Park and the West End, which president and CEO Eric Langan proudly points out is only a few miles south of the planned project. Shuttle buses? Meantime, I’m going to research breast implant manufacturers and place a call to my broker. 

Must-Read: The Folks Who Can Say “I Told You So”

Love this article by Bruce Bartlett, a new Forbes columnist —- significant quote:

“While conceding that economic fundamentals were favorable to rising home prices, they also noted that there were elements of bubble psychology in the housing market. Case and Shiller pointed to an increase in the buying of real estate for investment purposes and high expectations of housing price increases.

They also observed an increasing sense of urgency and opportunity among home buyers, who were plunging into real estate for fear of being left behind as they perceived their friends and neighbors growing richer–classic signs of a bubble.”

Second Home Market Sucking (Super Cold Yellowstone Club Type) Bad Air?

This story says there are bargains to be found in the Hampton’s — that is, if you think a $1.537 million second home is a bargain. (Here’s former Lehman Brothers president Joseph Gregory’s $32.5 million Bridgehamton vacation pad.) I have an idea: turn this place into a fractional ownership for those of us who lost money with Lehman. Any legal minds out there want to litigate this?  

Meantime, Tamarack in Idaho is under, while Credit Suisse is fighting to hang onto first lien status with uber-exclusive Yellowstone Club, which is just a mess , bankrupt and smarting from bad press due to the nasty divorce of it’s great-looking founders, Tim Blixeth and his ex (?), Edra. Also pulled in: luxury second home big boys Discovery Land Co. Interim lender CrossHarbor Capital Partners is trumping and may end up owning the joint because Credit Suisse apparently could not cough up enough cash for a debtor-in-possession loan:

“While it is highly unusual for a major lender to be pushed out of the first lien position in a bankruptcy, Credit Suisse may turn out to be too late with its latest plan.”

About this time last year I tried phoning YC to write up  properties as Hot Props in D Home — they acted as if I needed a security clearance and was trying to find the president’s war-time bunker. We ended up in Big Sky.

But Dallas Addison, who develops second home properties in east and south central Texas, as well as Hawaii, tells me the second home market is still pretty strong. (Posting his story soon: Dallas tells me that Hawaii’s Big Island gets so crowded with residents’ private jets they have to haul them off to other islands for parking.) Glad to hear it: I haven’t been on a Lear in forever.

Swapping Spouses, Houses?

A friend in Massachusetts told me about a couple-swapping ring going on at their country club — how risque! This I can handle: the DMN ran a cool story on house swapping. I understand house-swapping is a trade, an  ”I agree to buy your house, you agree to buy mine” transaction. Like consensual swingers, potential home swappers post pictures (”House Porn”) and descriptions of their homes online, hoping to attract other homeowners looking to trade. (Do they fudge on details, like 6500 square feet and oceans of granite when really those are 12 by 12 granite tiles?) Ideally, they buy each other’s property and even better, no STDs!

The National Association of Realtors does not track swap sales, but a number of house-swapping websites have popped up in the last couple of years, most reporting steady increases in online swap postings, like Craigslist, which reported a 30 percent increase in house-swap listings in 2008 over last year.

So I wish I had asked our teacher about this in school. Vitally,  what is the role of the Realtor? I would imagine it would be business as usual for Texas agents, but since out-of-state agents are considered “foreigners” here until they obtain a Texas license, wonder if you have to use an agent or an attorney if the swapper is in another state? And I imagine there are some horror stories out there — about the houses, not spouses — anyone?

PS: Another trend agents tell me we are going to be seeing more of: owner financing. Stay tuned.

Let’s Not Discuss Dallas Real Estate Values Today

This is not as bad as when you get those monthly stock reports showing that all the money you’ve stashed away for retirement is down by 36%. No sir, not that bad at all. Steve Brown reports a decline in Dallas home prices of just over 2% while some Texas cities have actually seen modest increases. Don’t even ask me about the national outlook: it’s Miller Time for builders — those Dom Perignon days a recent memory. As one local home builder told me: no one is picking up a hammer. Even the Russians are having problems. I am starting my appraisal battle file right now — will keep copies of all these stories so just holler if you need. Listen up DCAD: my property taxes should be LOWERED next year, retroactive to November 19, 2008. Got that?

Dallas, Houston, San Antonio Home Equity A-OK

So says Steve Brown today, citing the Center for Economic and Policy Research and the National Low Income Housing Coalition. I guess folks are concerned that if they buy homes, even cheaper homes, prices may fall after they sign on the dotted. Reminder: Real Estate is for the long term, not a three-month flip. The study says basically that Texans will have more home equity long term, and the worst is yet to come in areas that had huge bubbles, such as the so-called “sand belt”. See, Real Estate is such a local story… what do you think?

Plop Me At The Ritz-Carlton Residences, II

The bedroom. Who would want to leave? Wait, it’s San Francisco.

Plop Me At The Ritz-Carlton Club and Residences

Little marble around the tub for soaking.

Note To Kids: My Time To Go, Plop Me At The Ritz-Carlton Club and Residences, San Francisco

This article about how Marie-Dennett McDill, an east coast socialite, spent her last days on earth at the Carlyle Hotel, nearly made me cry. So much I called our attorney and re-drafted our will. When it’s my time to go, I want my kids to plop me at The Ritz, preferably in my San Francisco fractional ownership. Cannot get closer to heaven on earth. (more…)

Unemployment Will Peak in November, 2009

Texas A&M Real Estate Center’s Dr. Mark Dotzour spoke to a crowd of 1,000 in Houston, at the national convention for Commercial Real Estate Women yesterday, and outlined what it will take to bring investors back into the market. Quickie take-away — unemployment will peak in November, 2009, about a year from now. Commercial real estate needs to hit the bunkers for about two years. Then, it’s Miller Time.

Dallas Best Market For Real Estate Investing: SimplifyEm

So reports the Dallas Business Journal today, quoting Dallas-based HomeVestors of America, Inc. — the people behind the “We Buy Ugly Houses” slogan/signs. (So tempting to carry those in the back of my car!) I have heard this from others outside the state, including Narinder Sandhu, President/Founder of TreXglobal. Narinder, a Silicon Valley software engineer, was a VP at Intuit responsible for product strategy and development for Intuit’s payroll biz –one of their fastest-growing segments, he says. Narinder’s company, TreXglobal.com, has created a fabulous software program in SimplifyEm.com to save property owners hours of book-keeping headaches. (Let’s face it, when you own rental units as opposed to stocks, you don’t have to help foot the bill for the company’s $400,000 retreat prior to the stock’s flush down the commode.) Narinder, who owns rental properties in Dallas, says we have become a Real Estate darling for investors who are pulling out of places like Phoenix, Vegas and Florida… or who (whoops) maybe got burned there. In any case, his program makes it easy-peasy to track expenses. Easier even than Quicken. (Way easier than Quickbooks.) Takes less than a minute to set up and come tax time, just click and print off that schedule E.

Since I have investment properties, I am going to try SimplifyEm.com and will soon offer a review.

Jonas Woods W Condo Sales Price

As you know, Texas is an undisclosed sales price state. But a little birdie in the know tells me the 9285 square foot unit sold for $5.8 million. Impressive reduction, but still a great net. Carolyn Shamis brought the buyer (name not yet know, stay tuned) and here’s how she did it: Carolyn heard that another agent was looking for a home for a client in Preston Hollow with land, tennis court and pool. In other words, a spread. She got on a program “where you can look at people’s backyards,” she told me, and narrowed the search down to 12 properties with the necessary criteria. Then she wrote nice letters to all twelve of those estate owners: “Dear Trophy Property Owner, I have a bazillionaire client seeking a multi-acre estate in your beautiful area up to $15 million who wishes to pay cash. Don’t be an idiot, Wall Street melted, call me.” She sent the letter out Monday, got some downright nasty responses by Friday. (”How dare you contact me! My estate is NOT for sale.”) But on Saturday — and these stories are literally why I wake up in the morning — she gets an email from one of the twelve letters who ended up being the buyer of Woods’ penthouse. And by the way, that W pad is now this buyer’s weekend home.

$9 Million Penthouse Sale at The W: Adios, Jonas Woods

His 11,000 square foot penthouse (listing link no longer works) closed September 24, was on market 232 days, last list price $9,950,000, sales price undisclosed, listing agent Allie Beth Allman, Carolyn Shamis brought the buyer. 

Terrell Owens Owns $2.5 Million In Dallas Real Estate

I knew he had two units at the Azure, didn’t know about the townhouses near Fair Park. His FA, Jeff Rubin, says it’s all investment property (even, we presume, his Azure units). You go, T.O, but be careful. Ask me today if I’d rather have $35,000 in Dallas Real Estate or 500 shares of AIG, guess what the answer is.

Homes That Can’t Be Built in Little Forest Hills

You may have heard the rumblings as far north as Preston and LBJ: the battle for a conservation district in Little Forest Hills. Come November, the City Plan Commission will scrutinize the plan, which goes to the City Council for a vote in December. Very hot issue. If the plan passes as proposed, here is a list of homes that can’t be built in Little Forest Hills including one we shot for our newest issue of D Home.

Always A Bridesmaid, Never A Bride: Why Won’t This House Sell?

Reduced $100,000 from $1,495,000, over 5000 square feet of new solid construction,  and I think it’s adorable. Great street, great ‘hood, great look — Hill Country chic. So the builders want to know what gives. Similar props have sold like hotcakes in Lakewood. OMG, is Lakewood hotter than Preston Hollow? I don’t know. What do you think? (P.S. Dear President and Mrs. Bush — this is your style!)

Beach House Porn, Reduced: Cute Emerald Coast Only $695K

I just love the northern Gulf Coast of the Florida panhandle, and this darling three bedroom, one level WaterColor getaway built in 2006 can be snatched up for less than $700,000. Some good bargains out there…

Dallas Real Estate Feeling The Pain? Or Gain?

As I write this, Congress has hammered out the record-setting $700 billion bailout so unreal I always have to check to see if it’s really a “b” for billion. Steve Brown reports today that million dollar plus home purchases in Dallas are off by about 12 percent — this a market that has been invincible until just this year. As I reported earlier this week, Texas A&M’s Real Estate Center reported an overall 3.3 % drop in Dallas home prices compared to last year. Ellen Terry dropped the price of 3415 Beverly by a full million dollars, while Andrew-Merrick raised the price of 3500 Beverly to $17.9 million (check that m) because of cost increases in the final elegant finish-out. But what I don’t see anywhere in his column is that in 2007, the Dallas market was pretty much on steroids. So don’t go getting all gloom and doom-y on us. As for those higher jumbo rates, here’s a question: higher interest rate, higher tax deduction, lower home price — will it balance? I am starting to see more builder homes — those potential tear-downs — with “for sale or lease” signs out front and what Steve says about builders is true: most now won’t start a spec home without a solid buyer in hand or even better, embrace! As for the condo market, let’s not go there although… although Ritz says their sales have been Superman strong (see jump). Most properties in all price ranges have dropped prices or priced reasonably. When I spoke to the agents at Keller William’s Turtle Creek office no one minced words — it’s a tough market. Price the homes right, and if you want your home to sell sooner rather than later, it had better be darn special, have a “wow” factor. (I think I said as much in the October D Home, our Real Estate report.) But some Realtors tell me they are busier than ever — perhaps because there are fewer agents, and because interest rates were down for conventional loans. Terry Cook at Briggs Freeman has 6515 Northaven under contract. If any market is going to be hot to trot, it’s home leasing: Rogers Healy will soon launch Big D Renting.com because, in his opinion, it’s going to be tougher for some people to buy homes, so more folks will be leasing. He has the facts to prove it: area 11, 2005 — 139 total leases ranging from $475 to $7000 a month. Area 1, since January 1, 2008: 212 leases already up to $7500. Looking at Highland Park, there were a total of 123 leases ($525 to $12,000 per month) in 2005. This year, we are at 143 leases already, $595 to $9000 a month. Could that translate to higher rents?

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