In honor of my recent pro-renting rant, I thought I’d feature a rental for a change. No, it’s not exactly thrifty at $30,000/month, but hey, budgeting has to start somewhere.

Towering ceilings, a game room, wine storage, a library, a “fully staffed” building (whatever that means), it’s got it all. I can barely stand to look at this place, it’s so stunning.

Here's where I'd cascade down the stairs each morning to report for my indentured servitude.

The full listing at Sotheby’s says this place is perfect for an art collector or someone who loves entertaining. Seems to be the right stereotype for this space.

You know how I love my mixed-use, multi-family properties, so while this place’s price tag makes me nauseous, I have to give it credit for being so industrious. There’s a separate entrance for the downstairs area so you really can have live/work separation. I appreciate that.

I also love that Sotheby’s lists for rent this little sidekick loft – also in TriBeCa, with a similar vibe, only much smaller. Sotheby’s can slum it when times are tough!

The price tag on this little punkin’ is a mere $4,500. Seems practically free compared to the $30,000 artist’s behemoth.

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One final note to my dear readers: I realize posting has been a tad slim of late. I assure you it’s for a good cause–I’m building a new business, one that I think you’ll all really dig. I’m spending my days scouting out exceptional vacation rental properties that I can recommend on my new site, Inhabit Vacations. So the next time you curse fate that there’s not a witty, insightful Real Savvy post before you, know that I’m out in the trenches, finding super cool houses that you–yes you!–can visit. Real Savvy Real Estate isn’t going anywhere, so don’t lose faith, but posts may slow down a little while I get Inhabit up and running.  I’ve got a ton of real estate stories and inside scoops in the pipeline, so stay tuned!

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The building, if you remember, was a rent-regulated 6-unit West Village building. Listed for $4.5 million, it’s now under contract, and the owners are already trying to rent out the garden studio apartment for $2,500. Seems a bit steep for a tiny, dark apartment, but then again it’s been a while since I’ve dealt with astronomical NYC prices.

I wonder if the new owners will occupy the “Owner’s South Garden Duplex,” which looked nice based on the floor plans.

Word to the wise: it’s smart to start marketing your rental property ASAP, even if you’re still in escrow. Don’t get yourself into trouble by signing contracts, but it can’t hurt to start screening tenants. Everything takes longer than you think, so start making your money from Day 1!

Today’s real estate disaster is rather epic in scale, and it’s also a tale of six degrees of real estate separation. Remember the Taos home from last week? The one built by the Mithun architect? Well, I was clicking through the Mithun site and came across a stunning condo building they did back in 2004-8. After further digging, I found out that the condo building–Seattle’s Mosler Lofts–was the subject of much drama, which was dutifully reported on by my blogger bud Matt over at UrbnLvin.

It’s not Kevin Bacon, but it’s still cool to make connections across the real estate world. The drama largely surrounded a lien that stuck around for years (a lien being a claim against the title of a home, meaning you can’t sell it). The lien was finally resolved in the spring of this year, and the owners are thrilled to be released from their lien-created prison. Even the developer himself is using the opportunity to sell his unit.

Dramz aside, the building was ambitious in scale and in sustainability goals. The developer, Mark Schuster, even wrote a book about it: Lofty Goals. It’s clear that the building was a true labor of love for Schuster, who named it after his grandfather. I don’t know how much dirt he’ll dish on the lien, but hopefully he’ll go for transparency rather than simple PR. Sharing real stories is a great way to learn from each other.

On to business!

Let’s check out the units. The developer isn’t the only one peacing out on this building. Here are the units I found currently for sale:

• Penthouse #1 – 2,398 sq ft – $1,970,000
• Penthouse #2 – 2,000 sq ft – $3,00,000 (this is the developer’s unit)
• Unit #900-901 – 2,035 sq ft – $1,395,000
• Unit #1007-8 – 1,546 sq ft – $898,000
• Unit #316 – 991 sq ft – $388,000
• Unit #311 – 697 sq ft – $224,950
• Unit #704 – 551 sq ft – $209,000

A true condo assortment!

You’ll have to click through to see photos of each unit (and I do recommend checking them out – they’re pretty diverse), but here are a few to whet your palette:

What I know ISN’T lame is this tricked out sustainable house in Taos, NM. (Disclaimer: I was born and raised in New Mexico so I have inside information about how awesome it is.)

The home is 3 bedrooms / 2.5 bathrooms / 2,300 sq ft and is listed for $749,000. [Full listing here.] Oh, and to answer your question, horses are indeed allowed.

Designed by Antonio Pares, who now works with the sustainable architecture firm Mithun, the home’s listing claims one can live “off the grid.” One must wonder what exactly that means, as there isn’t much detail about the exact nature of the home’s sustainability claims. But when we’re blissing out to Real Estate Porn, we don’t ask too many questions. We don’t ask why it’s been on the market for 3 years, or why there are no photos of the kitchen/bathrooms/fireplaces.

Just splurge on images:

And now, people are increasingly questioning the value of home ownership. Some say it stifles creativity and innovation, which are vital to US economic growth.

But back to how all this theory impacts you in your individual life. A recent blog post by George Saines argues against home ownership and really any kind of ownership. Recognizing that he’s a 20-something startup founder whose priorities aren’t universally shared, Saines argues:

• Home ownership requires additional maintenance costs and time investment
• Owning a home makes it easier to accumulate Stuff
• Owning Stuff makes you less mobile and costs money and time
• Owning a pet requires expensive vet visits/pet sitters, and reduces mobility (I’d add that it also reduces your living situation options)
• Owning a car is convenient, but carries additional costs and stress over maintenance (“what was that weird sound??”)
• And my favorite: Owning very nice things stresses you out because you have to take care of them (this is why I avoid nice clothes or anything white)

In short, ownership means extra cost, less time, less mobility, fewer options, and more stress. Who wants that?

Similar to Saines, I’m a 20-something who has avoided getting bogged down with ownership as much as I can:

• I do own a condo in Portland, OR, but it pays for itself as a corporate apartment rental
• My boyfriend and I rent a small 1 bedroom apartment in San Francisco – we live in a central neighborhood close to public transportation
• I rent a furnished office nearby for my new business (more on that another time) with a month-to-month lease
• We don’t own a car; we rely on public transit, Zipcar, and a bike
• Instead of buying new furniture, we got nearly all our household items from Craigslist and thrift stores (not exactly renting, but our furniture doesn’t depreciate, so we can sell it later for the same price we paid)
• We get our music through Pandora and Spotify, our TV through Hulu and Netflix
• We don’t have pets, though I occasionally dog sit for relatives to get my animal fix

We cut out any and all overhead we can and rent wherever possible. This keeps us flexible in our lives and fluid in our careers. Sure, it’s a hassle to get around the city by bus. We can’t take road trips whenever we want. We don’t have a lot of space in our apartment, and we have to live with noisy neighbors. But the payoff in terms of life flexibility is priceless. Two years ago, on a month’s notice, I picked up and moved to Europe for a year for my job. Before that, I made two cross-country moves with less than a week’s notice, also to pursue work opportunities.

That said, if we were at a different phase of our lives, things would be different. People with stable income, who want to stay in one place, and who can afford all the costs of home ownership will likely choose to buy–and it makes sense for them. There is a lot to be said for pride of ownership, commitment to a community, and a sense of roots. But young first-time homebuyers would be well advised to really think about your priorities in life before rushing into home ownership.

Photo credit: I found the trippy photo on Buzzle.com

To refresh your memory, here’s what the front of their house looked like after their contractor discovered massive termite and fire damage while doing a simple window replacement:

After two and a half months of take-out Chinese food and living with a construction crew, Jocelyn and Kevan are happy to report that their dream house is back in one piece:

Here’s one more shot to give the full effect. Can’t you imagine them collapsing on the comfy couch after saying goodbye to the construction crew for the last time?

If you haven’t yet, be sure to read their eye-opening full story, which contains a ton of useful tips for first time homebuyers. Here are my three favorite:

• Know your rights and advocate for yourself. You have to remember that it’s your money and your livelihood on the line, so you absolutely should be educated and vocal throughout the process. Don’t let anyone sweep your concerns aside.

• Trust your gut. If something doesn’t feel right, it’s probably not.

• Don’t buy up to your budget cap, and allow lots of room for incidental costs. This is one thing we were smart about–we bought a home $60K under our limit, which has allowed us to pay for the unexpected repairs without going into huge debt.

As we’ve learned, even the most harrowing of tales can have happy endings. Congratulations to Jocelyn and Kevan on their gorgeous new home!

See, when you first find your dream home, the question is: how much should you put down? Then, it becomes: how much should you spend on renovations? Then: should we pay off the mortgage faster or invest our money? Then, when your house is paid off: should we take a home equity loan to finance such-and-such project/business?

And the most frustrating thing is that the only answer to all these questions is: It Depends.

I know. Frustrating, right?

Everyone grapples with this question, partially because it just seems so nice not to have a mortgage hanging over your head. But then you start to realize how much you’d have to give up in your everyday life in order to offload that mortgage, and it starts feeling less desirable.

My general position is this. You have to look at your real estate holding as an investment. And what are you supposed to do with investments? Diversify! Therefore, you don’t want to put all of your money into real estate. Not only is it one of the least liquid assets (meaning it’s hard to access your cash), putting money into a house can potentially imprison you there. If you’re not sure you want to live in that house the rest of your life, you may want to reconsider tying up all your money there.

But that’s just me.

A reader recently sent me an interesting story of one man who was so committed to a debt-free life, he paid off his 2nd mortgage in three years. Despite his single-minded commitment, he still notes that aggressively paying down a mortgage isn’t the smart choice for everyone.

For an excellent rundown of the popular wisdom on the topic from personal finance heavyweights, check out Get Rich Slowly’s expert advice redux.
So readers, what do you think? Are you planning to pay down your debt fast and furiously, or are you ok paying interest in exchange for flexibility?

This is not a new phenomenon. Back in the early 1900s, a man had a dream. He wanted to live on a rock in the Narrangansett Bay off the coast of Rhode Island:

And so, with the help of an artist, he sketched out the 3-story, 23-room Clingstone Mansion with lots of big windows. Despite heavy skepticism from the public, he made his dream into reality. It was to be a place where no one could bother him:

The man died in 1938. His house stood empty for decades, suffering from brutal weather and vandalism, until it was purchased by a distant cousin in 1961 for $3,600. The cousin is an architect named Henry Wood, and he undertook the monumental effort of putting the home back together (as quoted in the New York Times):

Every spring for a decade or so after the sale, Mr. Wood said, he cursed “this albatross,” his roofless, windowless, floorless, powerless, waterless house. Wrangling what had been a rich man’s plaything, attended by servants and even its own shipyard, into a working couple’s weekend getaway turned out to be much more than a working couple could handle. Eventually, though, as the Woods mustered the talents of their friends, Clingstone and its maintenance evolved into a communal lifestyle, and ultimately a kind of religion.

The house is an exercise in constant maintenance and pseudo-camping. In the early days, power was supplied by a generator, drinking water was brought in from the mainland, and toilets flushed into the sea. Now, solar panels, a wind turbine, and rainwater collection help the house run a bit more efficiently.

Henry has even found a solution for the epic maintenance Clingstone requires: every year around Memorial Day, he hosts a Clingstone work weekend, where 70 friends and volunteers come to the house to do everything from wash the house’s 65 windows to replace the sewer lines.

The house is stunning, but don’t plan on holding your wedding here. Not only is Henry Wood twice divorced, the three weddings hosted to date in Clingstone have all ended in divorce. I suppose the house is interested in supporting the free spirit, not matrimony.

Clingstone’s story is one of devotion, imagination, passion, and maybe a dash of insanity – I highly recommend reading the full account of its history in the New York Times.

Images courtesy the NYT

To save us all future cocktail party embarrassment, I’ll clear this up once and for all.

• A Townhouse (or Townhome) is a style of architecture, usually defined as having multiple floors, often with shared walls between units.
• A Condo (or Condominium) is a form of ownership, usually meaning owners have ownership rights from the “paint, in” and all other space is commonly owned.

You can have a condo that’s not a townhouse. You can have a townhouse that’s not a condo. Or you can have a townhouse-style condo.

Make sense? More discussion on the matter here.

• Do you ever get jealous of clients, watching them buy amazing, jaw-dropping homes?

I do! There are some AMAZING homes in LA and I definitely fantasize about trading places with some of the owners. However this only drives me to work harder so I can someday (hopefully soon) have an amazing house of my own. But when I’m checking out a million dollar mid-century in the Hills with a pool it’s hard not to get a little jealous sometimes!

• I’m sure you’ve seen a few dream homes while showing houses…what’s the latest favorite? And what would your perfect dream home be?
  

My dream home right now is an updated mid-century by a well-known architect. I think it would be so cool to live in a house with great design yet updated for today’s living standards. In general, my dream home would have a view, be high up in the hills and my fiance really wants a pool so we need that too. The interior would be very open, get lots of light, high ceilings, high end finishes and have three bedrooms.  A guest house would be nice, too.

• Do you think agent specialization in certain neighborhoods and types of homes really matters, or is it a marketing tool?

I think specialization is very legit. There’s something to be said about working with an agent who TRULY knows the neighborhood. They can help you avoid bad situations (like overpaying for a home) and point out not-so-obvious good situations. Furthermore, if an agent specializes in a type of home, it can come in very handy during home inspections and appraisals.

• Have you ever dealt with homebuyers who you can tell aren’t really ready to buy a home? What do you do in that situation?

Long term business and referrals are super important for a realtor, but our time is our most valuable asset. That means we have to be careful not to be “doormen” -  i.e., if someone just wants to see homes for fun and they aren’t real buyers, then a good agent needs to suss that out and focus their time on real buyers. It’s definitely important to engage with everyone we come in contact with on a regular basis, but not necessarily by driving them around to see homes. There are other ways to do that.

• How do you feel about working in an industry with such a bad reputation? It seems realtors get short shrift, similar to lawyers and insurance salesmen.

It’s hard. People definitely come into a relationship with a realtor with a pre-conceived notion and some skepticism. It’s a good realtor’s job to win them over and earn their trust. I think some realtors just don’t give the time and attention to their clients, but most of the “shady” agents get pushed out of the business.

• How can a homebuyer ensure they’re working with a good realtor?

It’s really about making sure your agent is committed to you and has your best interests in mind. Does your agent reply to your emails in a timely manner? Are they available to take you out for showings or do they brush you off? Are they writing offers with other clients on the same house (be sure they’re not!)?

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If you love East LA or mid-century modern homes, I encourage you to follow Rob’s blog, Take Sunset. You’ll notice I source a lot of my Real Estate Porn from there. Get your fix straight from the source! Also, if you’re interested in moving to LA, Take Sunset has a bunch of useful neighborhood guides.