Entrance Way: Before and After

I'm thoroughly whooped from a morning of house cleaning. The agent is supposed to be here an hour to take pictures of the place. Hopefully, when she's done I can get back to work. I need to ease into the news of the day, blog, and then get my own writing down. While I'm waiting for her, I'll write a  house-y post. 

Here's the entrance way of the house, after we ripped out wood paneling, the carpet, and a closet that covered the window. Seven years ago. 

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There's Dad pulling out nails from the rug. Hi Dad!

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We found the original wallpaper under the fake wood paneling, and linoleum under the carpet. 

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After the floors were sanded, it looked a little bit better. 

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It still needed a lot of work. Last month, we did the last remaining jobs in the place. We stained the replacement rungs, patched the ceiling, and fixed the molding. Here it is now:

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Believe it or not, we're actually going to lose a lot of money on this place. Le sigh. 

34 thoughts on “Entrance Way: Before and After

  1. I love stairs that turn with a window at the top of the first landing.
    But, why did people put up that brown paneling? Does someone have an explanation? Is it to hide some sort of fault? Is it ’cause the wallpaper was too hard to take off? Or did someone think that putting fake wood paneling next to real wood (and painting the real wood) was a good thing?

  2. I think they liked it. They put it all over the house. In one room, someone put wood colored linoleum over the real hard wood floor.
    The real estate agent left with one more chore for us to do. And more depressing news about how little she thinks we’ll get for this house. We’re going to lose a ton of money. Vomit. Vomit. Vomit.

  3. Conventional wisdom is that property values in NJ are holding up better than in the rest of the country. Is the CW wrong, or is your house/block/neighborhood/borough an exception?

  4. No, I think CW is correct in general. My family in FL is in deep, deep shit. But we bought in 2004, and prices are at 2001-02 levels in our town. I think we’ll get the money back for the improvements, but our house in its original state would be 80 thou cheaper today. We could have also forced the owner to make certain improvements that we just lived with back then, because competition was so steep. I also think that our neighborhood is going downhill fast. A lot more renters coming in and some sneaky rezoning by the town. We really need to get out of here.

  5. “Or did someone think that putting fake wood paneling next to real wood (and painting the real wood) was a good thing?”
    Our 1960s rental house has a bunch of it, too. It’s been successfully painted over in the dining room. I’ve seen paneling painted over in photographs of other homes, and I actually like the effect. It gives you a bit more texture and vertical interest than painted drywall would, plus it’s more durable (hence suitable for a high traffic area like a stairwell).
    “In one room, someone put wood colored linoleum over the real hard wood floor.”
    That’s really…special.
    I believe it’s typical that price drops start first in less desirable neighborhoods (like Laura’s), hitting more desirable neighborhoods last. If a person had the stomach for it, the financially optimal position might be to sell fast, rent for a year or two in the nicer town (tough to find a rental in a good neighborhood, I know), and then buy there when prices soften up a bit. There are a lot of foreclosures that aren’t currently on the market, but they’re eventually going to have to be sold.
    I told a story recently about a respectable 2700 sq. ft. home in a very nice neighborhood that went into foreclosure after a couple years on the market, half a dozen realtors, and a bunch of small price cuts. I saw another house recently (in the same fancy neighborhood) that seemed fantastic in the photos, but when I saw it in person, looked like another potential distressed property (peeling paint everywhere, decaying carport, and all three bathrooms almost untouched since 1937). One of my neighbors knows those owners. They are long gone, it’s been for sale for a long time, and my neighbor told me that she thought that they’d probably take high 100s for the place (it’s $250k now, but the initial price was $290 something). I walk in that neighborhood now and then, and I’m beginning to notice more signs of distress (like a mid-March Christmas tree) and deferred maintenance. It might be that a number of the sellers in Laura’s target area are in a similar position.
    The wild card is inflation. If there is substantial inflation, taking on a large fixed rate mortgage will pay off, as long as your income does OK. We’ve been planning to do a 15 year mortgage when we buy, but it has crossed my mind that there’s a pretty good chance that the magic of inflation might considerably ease the burden of carrying a mortgage 20 years from now. The downside is that we’ll probably have to bail the banks out again if they wind up with a lot of 5% loans in a 10% interest rate environment.

  6. I think another wild card is how much the houses will deteriorate before they go into foreclosure. Laura’s fixed up her house a lot, and thus might be prepared to do a lot of work on whatever they buy next. But my guess is that many houses in foreclosure after a long and slow decline will be in poor shape, with substantial work required to bring them up standards.
    My concern is that areas are going to become blighted before banks or people are willing to sell for the kinds of discounts that Amy’s talking about (a $290 house going for $170). How do banks have to count houses that are on their way to foreclosure/in foreclosure on their asset sheets? Is there an advantage to them delaying foreclosure/foreclosure sales while the house falls apart, loosing value?

  7. “My concern is that areas are going to become blighted before banks or people are willing to sell for the kinds of discounts that Amy’s talking about (a $290 house going for $170).”
    If they offered that house to me today for $100k, I’d think about it, but I don’t think I’d do it, for exactly those reasons. Also, if the owners couldn’t bestir themselves to paint the house, what else didn’t they do that I can’t see?
    “How do banks have to count houses that are on their way to foreclosure/in foreclosure on their asset sheets? Is there an advantage to them delaying foreclosure/foreclosure sales while the house falls apart, loosing value?”
    That question comes up a lot in online discussions. The answer that I’ve read a number of times is that the banks are required to have a certain amount of assets on hand, and if the value of their assets decreases substantially, the banks will be in trouble with the regulators. Or maybe the banks are just incompetent.
    What I’ve seen locally in our non-trendy part of Texas is that top dollar for homes is about $100 per square foot, middle class is about $50 per square foot, and there are a lot of foreclosures in less desirable parts of town for $36 or $37 per square foot. So I’m very curious to see how the big foreclosure (2700 sq. ft., with prices that oscillated between $270k and $245k) is going to be priced.

  8. “My concern is that areas are going to become blighted before banks or people are willing to sell for the kinds of discounts that Amy’s talking about (a $290 house going for $170).”
    I just remembered something about that one. One of the bathrooms had a whole series of small brownish stains that might have been water stains, but were distributed all over one of the (exterior?) walls. Both the realtor and I were shaking our heads over that one. With regard to that house, I think blight has already arrived, and on one of the most beautiful streets in our town. I’ll have to ask my neighbor who the owners are and what happened.
    Zillow claims that the 2010 property taxes for that house were nearly $8k, which is the icing on the cake.

  9. I think another wild card is how much the houses will deteriorate before they go into foreclosure.
    The owner occupied houses on my street keep deteriorating something fierce in certain cases. You just look at the roof and wonder how it keeps out water.

  10. Hey, MH, I know you don’t look next door to me, but some of us are really really busy. We really promise to do something over the summer.

  11. bj,
    That was really funny.
    I think I have the best excuse for not exerting myself on upkeep–our whole neighborhood is going to be bulldozed by summer 2012. Half is going in a couple of months, and the other half will go a year later. They’re doing asbestos remediation right now in the empty houses, which is not something I really want to think about.

  12. BJ, there are a couple of places that look so unoccupied that I checked to see if taxes had been paid (this was before I realized there wasn’t a tear-down house in my area that would leave me enough money to build).

  13. “A lot more renters coming in and some sneaky rezoning by the town. We really need to get out of here.”
    The story is starting to make sense.
    “The wild card is inflation.”
    Well, with core inflation at historic lows, and capacity usage still significantly below trend, this is not a worry for some time. And good luck doing a 30-year forecast.

  14. “And good luck doing a 30-year forecast.”
    Yes, that’s why it’s a wild card. You could have drastically different results depending on different scenarios, which is one of the reasons that I think that the 30-year fixed mortgage is a really, really dumb product from the bank’s point of view (or from the point of view of anybody who may need to bail out a bank). To loan out a couple hundred thousand dollars at 5% interest for 30 years is a crazy thing to do. There’s a reason for it being very unusual internationally.
    And speaking of those “historic lows”–that’s another good reason to sell while the selling’s good. As interest rates creep up (and with “historic lows” they have nowhere to go but up), there’s going to be significant downward pressure on home prices.

  15. “Average mortgage rates for homebuyers in the United States in the 1970s started off relatively low and were in single digits. By 1972, they were on the rise. A 30-year fixed rate mortgage in 1973 averaged just over 8 percent. A year later, interest rates had increased a full percentage point.
    “By 1979, the same 30 year fixed rate mortgage would carry an interest rate of just over 11 percent. 1980 saw interest rates continue to creep up to 13.74 percent. 1981 was the year that the average cost of borrowing money for a home in the U.S. reach an all-time high of 16.63 percent.”
    http://mortgage.lovetoknow.com/Historic_Mortgage_Rates

  16. On the other hand, inflation makes prices go up, so that’s kind of confusing. Maybe high mortgage rates will make buying homes more attractive for cash buyers, but less so for people planning to take on substantial mortgages?

  17. 1980 saw interest rates continue to creep up to 13.74 percent.
    Volcker had to do that to shock the system in order to keep people from putting up wood paneling.

  18. Very nice–good unobtrusive staging, lots of light, good structure, no idiosyncratic decor and plenty of photos. Laura, you may well wind up selling your house right off your website.

  19. By the way, have you thought about creating a stand-alone website for the house? A lot of people seem to be doing that. As far as I can tell, the advantage is that you can put a lot of photos up in large format, and as much other information as you like (floorplans, a map highlighting how convenient the house is for commuters, photos of local amenities). You’ve probably seen this already, but there are also youtube video ads for houses. A lot of those are under the auspices of justsnooping.com.

  20. Very nice. So, you’ve said that the neighborhood is going downhill which is what pushed you to sell. Can a marginal neighborhood support a house priced as yours in this type of market? I know housing is insanely expensive in your area but I guess I’m still surprised at east coast asking prices in a depressed market.

  21. It looks great! Although I feel like “the charm of a Manhattan loft” is code for something — I just can’t figure out what.

  22. We have super high ceilings and exposed brick. It will appeal to a former New Yorker, who won’t care that there are railroad tracks down the block and no backyard. They will like that they can walk to Starbucks and the NYC train. But that’s not the typical person who moves to our town, so the agent is trying to get their attention.
    Yeah, those prices are typical for around here. We’ll probably have to come down in price. Hopefully, not too much. This house in another town ten minutes away would go for 200 grand more. crazy.

  23. Sorry to make an nearly-unrelated comment here: Laura, my house has the same kind of wide, dark wood trim and dark wood floors, and I’m struggling to find a wall color that will contrast properly (right now it’s a dingy ecru). That yellow looks fantastic! Do you recall the specific color/brand of paint you used? I’d like to try it for myself.🙂

  24. Think of your brown trim like a brown sweater. What color scarf would you wear with it? You really should go for the second color down on a Benjamin Moore color card for most rooms, so the room doesn’t get too dark. Entrance ways are allowed to be loud. I used Benjamin moore’s lemon grass, but it’s a little too strong for some people; I might not use it again. Yellow is a tricky color. I think that pottery barn has started their own line of paints and had a very good yellow.

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