The Opposite of Flipping?

By
Home Builder with Retired

The Opposite of Flipping

In This Post

Is the opposite of flipping legal?

 

Karen Fiddler's recent post Don't House Flippers Deserve A Profit? stirred me enough to write about a local issue, which I'm sure is a problem in other cities as well.

Karen contends that flippers have a right to earn a profit from their efforts and there was not too much disagreement once acquisition methods were defined. Flippers improve a property and that improves the neighborhood as well. In my case I live near a relatively busy intersection. There is also a school nearby which was just remodeled to the tune of $93MM. It is considered a landmark building and it's views and views of it are supposedly protected. To further describe the neighborhood, it is predominantly single-family, older homes built between 1900 and 1935.

The commercial core of the neighborhood is centered 5 blocks west. The Neighborhood Association spent the last 15 years or so, developing a growth plan with anticipation that a light rail station would one day be somewhere near here. The association lobbied for the station and got it and it will be located one block from the core intersection in 2019.

Fast track backward about 40 years. An individual purchased a home in the neighborhood. I don't know if he lived there or not. The seventies were not pretty in Seattle as that was the period when Boeing almost closed completely. The same man was able to pick up a few more properties. Eventually he found that if two of his properties bookended another property and his properties looked like hell, the other property would be of less value. You may think I'm making this up, or imagining it, but I have seen property listed next door to some of his holdings. When something like that would come on the market he would have his "tenants" pile garbage along the property line in an effort to make the property unsalable. And he often succeeded.

Good Homes let go

The issue I and most other residents of the area have is how this man is trying to profit from his degradation of the neighborhood. Because of the light rail station, the neighborhood association has up zoned property around the station and the core to 40 and 60 foot heights to accommodate increases in population which will hopefully use the mass transit system. The land owner, now owning a block of at least 45 properties wants zoning of up to 160 feet. His proposal is to build two 160 foot towers, one of 125 feet and three of 85 feet directly south and east of the renovated school, and on the fringe of the village limits and the next neighborhood of single family homes.

Several things bother those of us who treasure the neighborhood we live in. One is that this person never had any valuable input during the planning stages. Another is that whatever he has owned has not been maintained. Once a slum lord, always a slum lord. Another is that the towers would utterly destroy a well kept single family neighborhood and the integrity of the remodeled school.

I could go on for hours and already have in another blogging venue. The question is, "Should a person be allowed to make a profit in a neighborhood after intentionally devaluing that neighborhood?" The problem we face is that most everyone from outside the neighborhood and out side the city says yes build the towers there in place of the slum you now have. Save some trees from being cut down for development in the Cascade foothills. And on and on about how green it is.

Posted by

 

 

 

 

Glenn Roberts
Retired

 

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Comments (39)

Glenn Roberts
Retired - Seattle, WA

Marcy - These all rotted from the insided out.

Lane - We'd like that and then give the property to the school. This high school has the smallest land foot print of any in the city.

Sharon - Clearly

Stan - We're wrking all of those angles and hope to prevail.

Aug 14, 2010 05:12 PM
Vince McEveety
Gilleran Griffin Realty - Sherman Oaks, CA

flippers do deserve a profit

 

the guy you desribe desreves tar and feathers

Aug 14, 2010 06:31 PM
Sylvia Barry
Coldwell Banker Previews International (#1 Marin_Sonoma_San Francisco_North_Bay) - San Rafael, CA
Marin and Sonoma Real Estate Leading Expert

In your case, it's not the regular investor we are talking about, it's a degraded, selfish human being.  No, he does not deserve to make a profit if he plays dirty.  But sad thing is, it seems to me that he knows how to work the system and he is making a profit and the citizens are having a difficult time stopping him.  Sometimes government is not flexible enough to help.  

Aug 14, 2010 07:37 PM
Jay Markanich
Jay Markanich Real Estate Inspections, LLC - Bristow, VA
Home Inspector - servicing all Northern Virginia

Wow, around here all Flippers do is "remodel" a home, mostly improperly, and try to sell a dangerous, finished product to unsuspecting buyers!  That's where we inspectors come in...

Aug 15, 2010 12:57 AM
Ann Hayden 636-399-7544
Berkshire Hathaway HomeServices Select Properties-St. Louis Missouri - Chesterfield, MO
SelectAnn.com

Glenn,

Hard to believe people would actually do this... 

Ann Hayden in Wildwood, MO

Aug 15, 2010 02:07 AM
J. Philip Faranda
J. Philip Faranda (J. Philip R.E. LLC) Westchester County NY - Briarcliff Manor, NY
Broker-Owner

It would be ironic if the guy dropped dead 2 weeks before "cashing in." 

Aug 15, 2010 02:43 AM
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

It is a good question you present Glenn...if the person making the investment is willing to take the risk, the gain should naturally follow. Don't forget that in a lot of cases,  the city and the public is allowed their opinion via input and if someone makes it through all that, they are entitled to their reward......thank you glenn

Aug 15, 2010 02:50 AM
Glenn Roberts
Retired - Seattle, WA

Vince - Tar and feathers? Why didn't we think of that sooner.

Sylvia - Regular investors at least try to improve a property. Blue tarps do no a new roof make.

Jay - We just got the city to pass a new rental inspection law, and a lot of good land lords don't like it. But the bad ones like this guy hate it. We will find ways to shut down sub standard living quarters and hopefully tear down these atrocities.

Ann - I think it was fairly innocent at first but his true personality took over.

J. Phillip - I don't think it's about cash at all. He could have sold any or all of these properties during the 90's or the 00's and retired very wealthy. No, it's more about sticking it to the neighborhood, and a shrink can parse out the reason for that.

Richie - It's an uphill battle. His premise is that the neighborhood would be better and that is serves the needs of the light rail. And it looks that way to anyone who doesn't know him. We know him.

Aug 15, 2010 03:07 AM
Glenn Roberts
Retired - Seattle, WA

Michael - we're trying to avoid the moral issue and go with the rights of a community over the rights of an individual. That's always a tough fight, and for good reason. Seattle is in another fight right now of allowing home owners to cut trees only with a permit, or not.

Aug 15, 2010 03:10 AM
Courtney Cooper
Cooper | Cartwright - Seattle, WA
206-850-8841

So Glenn, since I happen to know a lot of Roosevelt alums as I am sure you do, what do you think about you and I launching some kind of attack back campaign through our contacts and online?  That would be horrific to have such a high density building ruin the neighborhood.  I knew about this, but not as extensively as your 20 year history of it!  Let me know what I can do - I have a talent for writing letters and making "sweet as pie" persuasive calls.  PS - Reblogging you.

Aug 15, 2010 03:16 AM
Glenn Roberts
Retired - Seattle, WA

Hi Courtney - Thanks for the reblog and the offer. Check out my Roosevelt-Ravenna Zoning Issues blog and also do one of your localism pieces. There is always something going on. Right now there is a small lull, as we just defeated their attempt to change the Seattle Comp Plan...for this year anyway.

Aug 15, 2010 03:30 AM
Jeana Cowie
RE/MAX Real Estate Limited - Paramus, NJ
Broker Associate, ABR, CRS, GRI, SRES

Glenn,

That is a terrible thing for the neighborhood. I agree with an earlier post about talking to the town to see if eminent domain is an option. The only problem is the target area should only be his properties. Hang in there.

Aug 15, 2010 04:23 AM
Brent Wells
The LivingWell Team - Prosper, TX
Real Estate Broker serving all of North DFW

Glenn, this is an approach to long term speculation that some investors have. Very self-centered and bad for the community...

Aug 15, 2010 05:56 AM
Glenn Roberts
Retired - Seattle, WA

Jeana - We are in touch with city council frequently.

Erica - Yes, flippers can and often do improve property significantly. This is the opposite.

Brent and Deb - Very self-centerd in bold.

Aug 15, 2010 06:11 AM
Rene Fabre
First American Title - Seattle, WA
Marketing in the Digital Age

I remember those 70's and I remember that very same thing happening on Capitol Hill... probably the same guy! I'm sure public awareness and social media could play a lending hand here. To answer your question, no they should not profit if their gain is based on the loss by the neighborhood.

Aug 15, 2010 06:35 AM
Glenn Roberts
Retired - Seattle, WA

René - I hope we don't end up looking like Capitol Hill.

Aug 15, 2010 06:51 AM
Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate

If an investor buys a house, fixes it up and flips it for a profit...that is good for the neighborhood.

The situation you described is horrible.

Aug 15, 2010 10:41 AM
Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

Michael - we're trying to avoid the moral issue and go with the rights of a community over the rights of an individual. That's always a tough fight, and for good reason. Seattle is in another fight right now of allowing home owners to cut trees only with a permit, or not.

That is absolutely incorrect.  If it were the "rights of a community" over the "rights of an individual", I would come down squarely on the rights of the individual.  It is his property, and he can do what he wants with it... until he damages another individual with his use. 

In this case, he is actually damaging all of the individuals with adjoining properties.  While I mentioned the possibility of going after him through eminent domain, I think it might be better to go after him through the courts...  Sue him for damaging property values.  He is causing monetary damages to property owners... if they get together and start suing him, it won't be a good deal any more.

Aug 15, 2010 04:30 PM
Glenn Roberts
Retired - Seattle, WA

Missy - It would have been nice to see all of these properties come on the market and get fixed up or replaced. Not his plan.

Lane - Thank you for your continued thoughts on this. On the tree issue, there is a large block of people who think that cutting any tree is un-green and there for hurting the rest of the people and the ecology of the area. That's a pretty sweeping statement and it's unlikely one tree here or there has a large effect. Amazon rain forest is another matter.  As far as this guy, he has been taking everyone to court, currently a high school student who quoted another article that said he was a racist. That we could all sue him is a possibility and we may go that direction should our other efforts fail.

Aug 15, 2010 04:51 PM
Sarah, John Rummage
Benchmark Realty LLC, Nashville TN 615.516.5233 - Nashville, TN
Love Being Realtors® in the Nashville TN Area!

There is a one landlord here, and if he owns a house next door to a potential seller, they will point toward it and sheepishly tell you that Mr. _____ owns 'that' house.  Owners feel that he has ruined several nice streets.

Jun 07, 2014 12:53 AM