How Selling Inexpensive Homes Can Be Valuable

The real estate business can be odd. We Realtors breeze into the lives our clients, get to know their kids, hear about their jobs, their commute, the marriage or birth or divorce that prompted the move, and sit at their kitchen tables while their cat or dog or baby sniffs or claws or pulls themselves up on our pant leg. And we lead them through the often-emotional journey of buying or selling a house, a process that usually reveals their hopes and dreams for their family.

And after a few weeks or a few months the job is done, we shake hands at the end of a closing and we breeze out of their lives and into someone else’s.

I’ve been fortunate recently to work with a couple buyers looking at expensive homes. One family settled on a $500,000 home while another client has looked at 2 houses priced over $1 million. These homes have 3-4 car garages, 5-6 bedrooms, at least three and a half baths, hardwood floors, granite countertops, tiled & marble baths, basement wet bars, theater rooms, and climate controlled wine cellars.

But as enjoyable (and profitable) as it might be to sell those big dollar homes, some of my most rewarding experiences in real estate have come from helping people buy very inexpensive homes.

My favorite sale was to a 30-something woman I’ll call Shelly.

One day at the office doing what we call floor duty – answering the phones when people call about a house. Shelly walked in looking a mixture of weary and timid. Once she sat down she said simply, “I want a house.”

We chatted about what she wanted. Shelly said she worked as a waitress in a high-end restaurant, had just left a bad marriage and was hoping to buy a place for herself and her two daughters. She described the crummy, poorly maintained rental she was living in and said, “I want something better for my girls. They shouldn’t have to live like this.”

The human side of me wanted to help her. The professional side of me understood how waitresses and bartenders often handle their money. Many claim their paychecks on their taxes but hide the cash tips from the IRS. If Shelly’s claimed income wasn’t high enough, she wouldn’t be able to buy a house.

I took her across the hall and sat her down with our in-house lender and discovered that was exactly the case. If she’d claimed all she actually earned, she would have qualified. But with the cash tips hidden, she didn’t qualify.

So on the back of an envelope the lender and I made a list of the things she needed to do in the next year to put herself in a position to buy a house. I asked for her phone number so I could check her progress, but as she left, defeated, she said, “Oh, I’ll just call you once I get this figured out.”

I was certain I’d never hear from her again.

A year later I had completely forgotten about Shelly. But one day our receptionist buzzed in to my office, “Kurt, you have a visitor in the lobby

As I came down the hallway I saw Shelly standing at the receptionist’s desk with a tattered envelope in her hand. After we said hello she handed me the envelope and said, “I did everything you told me to do. Can I have a house now?”

I looked at the envelope in disbelief. My handwritten notes from a year before were faded, perhaps bleached by the sun during weeks or months on the dashboard of a car. Alongside each line item there was a checkmark. A half a coffee-cup ring ran along one edge and what looked like food stains were splattered near the top. On one corner was a hastily scribbled phone number labeled, “Credit Bureau.” In the blank space at the bottom she’d made a wish list describing her dream house; “3 bedrooms, at least one and half baths, a good roof, a quiet street, and a yard beg enough for a dog.”

“Yeah,” I smiled at her, “you can have a house.”

What we found cost just $79,000. It was all she could afford: a small, modest pre-fab ranch on a quiet street with a good roof and a yard big enough for a dog. It had plastic woodwork, dated, though clean carpet, low ceilings, paneling, and no garage. Everything was well maintained and in proper working order. Both daughters got their own bedroom and a new dog got a yard.

At the closing, Shelly was certainly happier than I was, but I ran a close 2^nd.

If I’d had my wits about me I’d have kept that envelope, framed it and hung it in my office as a reminder of how rewarding this job can be.

Why Arizona's New Immigration Law is Wrong

Arizona’s new immigration law is a betrayal of our Constitutional values. Let me show you by applying the “Arizona logic” to another big problem: illegal guns.

Our Constitution guarantees Americans the right bare arms. But there are so many guns in this country it’s hard to separate the legal from the illegal?

By illegal I mean guns that are being sold on the street, from criminal to criminal, often stolen from law-abiding citizens and held by people convicted of violent crimes who have no permit for those guns. This illegal trade and ownership of guns provides muscle for the illegal drug trade, nurtures gang violence, and spreads criminal activity nation wide.

It’s a problem of a scale and impact so large it touches nearly every person in America, requiring ever-higher taxes to fund law enforcement to battle it, and effecting the personal safety of people in large cities and small communities alike. I want a new law to address this chronic problem in Indiana. I hope other states will adopt it as well.

My “Arizona-style” gun law for Indiana: The police shall have the power to stop those they suspect of carrying an unregistered or stolen gun and ask them to prove that they have the right to own and carry that gun.

No sooner is my proposal signed into law, the National Rifle Association and the politicians whose campaigns they fund, go ballistic. “You’re infringing on the rights of law abiding Americans,” they protest. They demonstrate in the streets, harangue on television and radio talk shows, demonizing the law. The NRA promotes a boycott of Indiana.

I’m stunned by the opposition. I respond, “How could any law abiding citizen who wants America to be a safer place disagree with my law? If you have a right to own and carry a gun and bought it legitimately, you have nothing to be afraid off?”

“That’s not exactly true,” my opponents respond.

“Legal gun owners are going to be targeted by the police,” they say. “Any hunter with a gun rack in their truck, people coming and going from gun stores, gun shows and firing ranges, and people just legally walking around with a gun on their hip could be stopped and harassed by police.

“We do want to address the problem” my opponents insist, “but what you’re proposing infringes on the Constitutional rights of law abiding Americans. Just because you have a chronic problem that, yes, is hurting America, doesn’t mean that heavy-handed laws are the answer, especially when they betray our Constitutional values.”

Would my gun law get a lot of guns off the streets and out of the hands of criminals? Probably. Should we do it? No. Because it violates the Constitution.

How is that anything like Arizona’s new law?

Our Constitution guarantees Americans the right to be free of unreasonable search and seizure. But there are so many illegal immigrants in this country it’s hard to separate the legal from the illegal?

Illegal immigrants flood in through our porous borders in numbers so great their presence is a problem of a scale and impact so large it touches nearly every person in America, driving down wages, burdening taxpayer-funded medical facilities, and driving up taxes to pay for public services like schools, fire and police. Arizona wanted a new law to address that chronic problem.

So their police will have the power to stop those they suspect of being an illegal immigrant and ask them to prove that they are an American.

Civil liberty groups like the ACLU and immigrant rights organizations have gone ballistic. I think the law is wrong because it infringes on the rights of legal, law abiding Americans.

Supporters of the law respond, “How could any legal citizen who wants America to be a better place disagree with Arizona’s law? If you’re an American citizen, you have nothing to be afraid off?”

That’s not entirely true.

American citizens who have dark skin or a foreign accent are going to be targeted by the police. Anyone of Latina heritage, people coming and going from ethnic groceries or restaurants, and people just legally walking around immigrant neighborhoods could be stopped and harassed by police, constantly being asked to prove their citizenship.

I do want to address the problem but the Arizona law infringes on the Constitutional rights of law abiding Americans to be free of unnecessary search and seizure. Just because you have a chronic problem that, yes, is hurting America, doesn’t mean that heavy-handed laws are the answer, especially when they betray our Constitutional values.”

Will Arizona’s new law find a lot of illegal immigrants? Yes. Should we do it? No. Because it violates the Constitution.

Our forefathers wrote a constitution not based on what was easy or expedient, but based upon what was right. Dictatorship, monarchy, and marshal law are easy. Constitutional democracy is hard. Start pulling at the thread of popular shortcuts and the whole flag could unravel.

Ice Cream & China

I got home from work still deep in thought. I stepped from the garage to the yard and walked over to the garden to survey the romaine, the spinach, the early shoots of asparagus.

I dropped my briefcase in the grass and bent over to pull a weed, thinking about a phone call from earlier in the day. As I did, I heard the ice cream truck turn onto Cherry Street. The familiar blooping, doinking sound of Pop Goes The Weasel echoed among the houses.

I flinched.

That’s because for years that sound would soon be followed by the sound of kids - my kids, running and screaming for me. “Dad, can I have a dollar?’

Jack, our now 19-year-old middle child was always the most desperate. He’d appear before me in a breathless panic. “Please, please, please,” he’d whine, doing a funny little dance like he was running in place and shaking his hands as if to dry them off.

I usually handed over the dollar.

Jack would appear later with multi-colored pastel sherbet smeared around his mouth from a Teenage Mutant Turtle pop with gumball eyes.

But today no one is running for ice cream. Jack and his brother Cal are off at college and their younger sister is at track practice. The ice cream man passes by and disappears down the street. This once lucrative block is now a bust for ice cream peddlers.

I pluck my briefcase from the grass and head into the house still thinking about Jack’s phone call earlier in the day.

He said, “A professor recommended me for a trip this summer to do some writing and blogging”

“A trip where?” I ask.

“China,” he replies.

There is a long silence.

That’s a whole lot more than a dollar. A whole-lotta dollars in fact.

There’s nothing in his voice to suggest he’s doing that little ice cream dance. No hint that he’s flinging his hands about waiting for the money. His voice is cautious and apologetic. He knows he’s asking for something big, something bigger and more important than a frozen treat.

“I understand it’s a lot,” he says. “It’s okay if you say no. I’m just wondering if it’s possible.”

Yeah, it’s possible, I think to myself. But at what cost? I worry over the money. Worry that instead of working the summer to earn money for his textbooks and gas he’ll be doing something expensive. And to be honest, I lament not having him around all summer.

When Jack and his older brother Cal were small, we bought a rental property with a loan from my parents. It was to be the boy’s college fund. Once last year when Cal called from college to ask for money, he asked me, “Dad, where exactly does this money come from?”

“Remember all the years you picked up walnuts over at the rental,” I tell him, “all the times you mowed the lawn, cleaned the gutters, helped me reroof? That rental is where the money comes from.”

There was a stunned silence at the other end, though I’m sure I explained it repeatedly when he was 8, or 10, or 14 years old - when he was mad about having to go there and work. Either he forgot, or the meaning never sunk in.

A couple hours later he sent me a text message that read, “You’re so smart. Thanks for being such great parents.”

Well I had great parents, too and they made it possible for me travel abroad when I was in college. They didn’t really want to, but they did. It was one of the most valuable experiences in my life. One I’ve always wanted to provide for my own children.

And so we do provide it. Jack will go to China. The rental property works it’s financial magic once more. I guess I always knew I would say yes, but was just trying to figure out how to get there.

A few weeks after Jack’s call, Greta and I joined him in Muncie for lunch with his professors and the other students going on the trip. A Chinese family cooked a hot-pot dinner for us. We sat around a table dropping shrimp, crab, pork, green beans, cauliflower and mushrooms into a bubbling wok filled with herbs and spices, then plucked it all back out and onto our plates. It was fabulous. They talked about where they would travel over the summer, Hong Kong, Beijing, the Great Wall, and Expo 2010 in Shanghai.

Jack’s excitement is palpable. Like George Bailey pacing the train platform and lusting over travel brochures in, It’s a Wonderful Life, Jack has been chomping at the bit to get out into the world. Knowing that and being able to make it happen is gratifying. It’s harder to give than ice cream, but way more rewarding.

More on the Referendums

There's been quite a response to this week's blog entry about the school referendums facing voters in May. I've been repeatedly stopped in local shops this week and gotten loads of emails from people who read it. If you want a little more to chew on - go back to the March entries to the blog and read an earlier comment on the blog.

The Referendums: An Open Letter to Noblesville's Retired Voters

Some of the major grumbling I hear about the school referendums facing Noblesville voters this May comes from the older voters.

A frequent complaint goes something like this:

“When I was a kid in school we didn’t have all this equipment or schools built like palaces, and I still got a good education.”

With all due respect to my elders, how about a reality check.

Our schools today are not preparing children for the jobs of the 1950s, ‘60s, or ’70. That’s the education you got. The factory and farming jobs that were waiting for high school grads in that era are largely gone. America’s dominance in nearly every field of endeavor (and the accompanying jobs) has waned.

That was a different economy and a different employment landscape that no longer exists.

So our schools today are preparing children for the jobs of the 2010s and 2020s. This requires lots of computers, high tech science labs and cutting edge audio-visual equipment. Our kids are now competing with children from around the world whose nations, unlike in your youth, have good educational systems and natural resources they are ready, willing and able to use.

And here’s something else our schools have to do that your school of days gone by didn’t have to do: Remember the kids in your youth who you thought of as retarded, or mentally deficient, or just trouble makers? Some of the kids were actually dyslexic, or had Attention Deficit Disorder, or were autistic. The generation of educators who taught and led your schools back in the good ‘ol days didn’t understand these conditions and so they labeled those kids trouble or mentally weak.

Today, thank God, we better understand the conditions these children face and our educational system is required to give them the extra care and attention they need to live productive lives. That requires money and manpower – and we’re a better and more decent community for it.

And the school buildings of your youth weren’t cheap. The Noblesville school buildings used in the ‘30s, ‘40s & ’50 were built during the late Victorian era and early 20^th Century during earlier periods of rapid growth. The town could have built barns for you to learn in, but instead they built solid, stately buildings of brick and stone with hardwood floors and quality architecture. There was one at the North Elementary site, another at Seminary Park, another further south at 10^th, and a high school where the Boys and Girls Club is now.

Go digging through old newspapers on microfilm in our library from the 1890s, 1910s and 1920s and you’ll find lots of complaints from people about, “these massive buildings,” and, “the lavish waste of taxpayer dollars.”

These are actually your modern-day complaints echoed from your grandparent’s generation.

Thank goodness for you the buildings got built and the teachers got paid. And if you’re temped to start pining for a long-gone era when teachers were paid less and had fewer benefits, recall too that the retired folks in that same era didn’t get Medicare or a taxpayer financed drug benefit. So if you’re going to ask school employees to go back to that earlier world, are you willing to go back with them?

But, “Why do they have to spend so much money?” really is a reasonable question to ask; one our school leaders have answered pretty well if you’ll take the time to listen. But just because it’s a reasonable question, doesn’t make it a fair challenge to every expense. Go too far down that path and you end up a person who knows what everything costs, but doesn’t know what anything’s worth.

Retired voter, your parents and grandparents struggled with the same school funding questions you’re facing now. The decisions they made then were financially difficult for them, too. They made those decisions in an era when they had no Social Security, no Medicare, and no taxpayer-funded drug benefits. But they still chose to support schools at a level the world had never seen before, which helped make America the most powerful nation on earth.

Voting yes on the two school funding referendums this May doesn’t offer a free ride for anybody. Our schools have already cut spending dramatically and even if you vote yes, they will have to keep tightening their belts and trying to figure out how to do more with less. An earlier referendum was already shot down – so there’s little doubt school leaders got the message.

The referendums that are before voters in May are not an Us vs. Them proposition. There is no “Them.” It’s all Us. We’re all in the same community and the schools in our community need us to see this financial challenge for what it is – our responsibility.

Health Care for "Poor People"

Woven among the various reasonable arguments against health care reform was the complaint, “Why should I have to pay for health care for people too lazy to get it themselves?”

This, “blame the poor” argument is so cruel and ignorant it nearly takes your breath away. It’s just another example of how a personal bias can sound like the obvious answer - facts be damned.

The health care horror stories I’ve personally encountered in recent years have nothing whatsoever to do with poor or lazy people.

Last year I wrote about my friend, I’ll call her Cindy, who gave up her health care policy when she could no longer afford it. Cindy is a private business owner. She works at least 10 hours a day and often longer, at least 6 days a week. Each year as her health insurer raised rates (though she was healthy and never made claims), she increased her deductible to keep it affordable. Eventually her deductible reached a whopping $10,000. So she didn’t show up in the statistics showing tens of millions in the U.S. without health insurance; that is until she eventually couldn’t afford even that either.

Not long after I wrote about Cindy I got a mass email from a Noblesville health care reform opponent. It was authored by a doctor who described a derogatory stereotype of an African American, inner city “welfare queen,” and then asked, “And our Congress expects me to pay for this woman's health care?”

It would be so simple if that’s what health care reform was all about – a distant, threatening, lazy minority. But it isn’t. The Doctor apparently isn’t aware that the average family living below the poverty line in America has at least one adult working full time.

Another Noblesville couple I know, I’ll call John and Sherry, also work long hours as private business owners. When Sherry needed radical dental surgery they didn’t even consider getting care in the U.S. They have dental insurance, but it came with a annual cap that wouldn’t begin to cover the cost of the multiple surgeries Sherry needed. So John and Sherry made two trips to Costa Rica and three trips to Mexico where Sherry was treated in first class facilities by American-trained doctors for less than a 3rd the cost of care in the U.S. (including the cost of travel). That they felt they couldn’t afford care right here in Indiana is nothing less than depressing. That they found it so inexpensive in a nearby and otherwise backward country is demoralizing.

Yet, in the Let It Out sidebar of the Indianapolis Star, over the past year I’ve read comment after comment moaning, “How can Obama make me buy health care for lazy people?”

That's an oversimplification on steroids?

Cindy and John and Sherry aren’t lazy or poor people and their problems with our health care system have nothing to do with how hard they work. The problem is a marketable product (health care) that doesn’t operate very well in a free enterprise system. That’s what my friend and client, Ben encountered.

Ben is also a private Noblesville business owner who found himself doubting he should purchase a home because of our dysfunctional health care system. A few weeks before closing on a modest Noblesville home he found he needed a heart stint procedure. In the years previous, he’d been paying an ever-increasing rate for health insurance. As a result of the procedure, he feared his insurer would raise his rates even more. The procedure went well and he got good care here in Noblesville, but he now knew he couldn’t shop for a new policy because he had a pre-existing condition. With so much financial uncertainty, should he buy a house?

He decided to go ahead with the purchase the same day President Obama signed the new health care bill into law.

As Ben and I stood outside the house chatting about his dilemma, he told me about a friend of his in a depressing, dead-end job. The friend is bright and hardworking and wants to quit his job and start his own business, but doesn’t because he’s afraid of leaving his family without the insurance his dead-end job provides.

So much economic activity has been strangled by our screwed-up health care system. And most of the problems have nothing to do with “lazy poor people.”

Remember just a few years ago when bankruptcy laws were reformed making it harder to file? TV and radio talking heads and politicians attacked bankruptcy filers as people living beyond their means, racking up debt they knew they could never pay back, “people who think the world owes them the good life.”

But a recent study conducted by Harvard University found that in reality 62% of all personal bankruptcies in America are caused by medical bills. And here’s the killer - 78% of those people who filed for bankruptcy because of medical bills had health insurance when their illness began.

This doesn’t happen in countries with a national health care system. And these aren’t just numbers, they represent thousands of destroyed lives and devastated families every year.

But still last week I saw someone post on Facebook, “I think the government should just stay out of health care and not take money from me to pay for lazy poor peoples health care.”

Complete and utter ignorance. And with so much blatant evidence to the contrary, it’s willful ignorance.

What Dreams May Come

I’m seated at a table. Someone is behind me, their arm wrapped round my neck holding me tight to the chair. As I struggle, another unseen person grips my left arm forcing it flat against the tabletop. A third person lays the head of a huge snake on my arm. It slithers forward and bites my hand, it’s fangs pierce the soft skin between two fingers. Across the table, my 15 year-old daughter sits crying.

I woke with a start, breathing heavily and my heart pounding. I stared at the ceiling in the darkened bedroom thinking, “Where does this shit come from?” It took a half hour to get back to sleep.

Next morning when I drove my daughter to school, I described the dream to her but left out the part about her being in it. It was just too weird.

I’ve always been baffled by the origins of dreams and never accepted the psychological explanations. Still they’re fascinating.

Years ago the younger of my two sisters described a troubling, reoccurring dream. In it, she can fly, but is trapped in a large house. She’s pursued by crowds of people. She strains to fly out of reach, her flapping arms bumping the ceiling as the fingertips of her pursuers graze her stomach and chest. As the room fills with people reaching for her, she crashes through a set of French doors into another room, and again flutters against the ceiling, just barely out of reach.

I remember my older sister’s ex-husband, a psychologist, listening intently as the dreamed was related, searching his mind for a clinical explanation.

My wife’s dreams are every bit as weird as mine and come in predictable themes. When she tells me, “I had an upsetting dream last night,” I often reply, “ Let me guess, you’re in your hometown back in Michigan and you’re outside a familiar house and someone is either chasing you into the house or watching you menacingly from it.”

When my kids were little I often dreamed that they were in danger and I couldn’t reach them or was too late to help. These often contained a location or circumstance of importance from the days leading up to the dream.

Nineteen years ago as my wife was pregnant with our 2^nd child, I did some roof work on our house. I don’t like heights, but I had to crawl across the highest point of our steep roof to do the work. It took me forever to scoot along the ridge on my butt and do the work that an experienced roofer could have done quickly.

A couple nights after that I dream I’m back up on the roof scooting across the ridge, looking down at the street and neighboring rooftops. I hear the scratch of footsteps behind me. I turn to see our oldest son, two and a half years old at the time, walking toward me playfully along the narrow spine of the roof with a half eaten cookie in his hand. The familiar scuff of sleeper suite foot-pads scratches along the shingles.

He’s going to fall. Of course he’s about to fall! And I’m battling my own fear of heights to get at him before he does.

But neither of us fell. I woke in terror before it could happen, then walked to his room in the dark and peered over the crib to see him sleeping safely in the drug-like sleep of children.

In another puzzling dream, recalled from my college days, I’m a defendant in a courtroom accused of something terrible. I mean really terrible. I don’t know what it is, but it’s something so vile and unforgivable people are sneering at me.

I’m innocent. How can I make them understand? I look to the judge and jury, slowly scanning their faces, only to realize that they’re all girls I dated in high school or college. My heart sinks, thinking, “I’m screwed!”

What could that possibly represent? I’m really a pretty nice guy. Sure I’ve made some foolish and selfish mistakes in life, but c’mon.

After knee surgery this past January one would have thought the soothing, narcotic painkillers would have made for restful sleep. Instead, the drug held me sloppily along the shoreline between sleep and waking. I would fall into a dream – a handful of nails, a hammer and pile of lumber – I’m building something, then suddenly awake staring at the ceiling. Close my eyes again and the waves take me down into another vision – tripping down several stairs – I reflexively jerk awake again, look around, close my eyes and sink into yet another vision.

Greta and I exchanged weird dreams stories over dinner recently. Our daughter, Sally eyed us both suspiciously. “My dreams are always good,” she shrugged.

“What? You’re kidding me?” I asked. “Always happy?”

“Yep,” she smiled. “Always good things.”

You lucky dear. I hope it’s always that way.