News

Well, I said I'd probably have some big news today. I do.

We're selling the land in Delaware. We won't be building a house on Hopkins Prong.

The year 2008 was rough on a lot of people, Steve and me included. It began early, when we learned that Steve's company was reneging on policies in place when he was hired but changed without notice: his pension would be drastically reduced because of California state retirement programs they opted out of. We had no recourse, these programs were not part of any employment contract, just perks the company decided it could no longer afford.

OK. We could still make it on the new income, reduced as it would be. And we still had this little Arlington gold mine we're living in. We own it free and clear; a second mortgage against it was paying for the land in Delaware, but selling the house would clear that and build a dream house as well. If we had to take a little loan to make it work, maybe $50K, that would be OK. We continued with our plans and enjoyed our summer weekends in the trailer.

Then came the real estate crisis. DC and its close-in suburbs have taken hits with the rest of the country, but not as big. Well, at least in some places. It so happens in our Zip code, however, 50% of home sales over the past 12 months have been foreclosures. Fifty percent! Home appraisals are not supposed to be influenced by a nearby foreclosure or two, but at that rate, all home values are affected.

We were starting to sense clouds on the horizon but had heard that Arlington homes would lose only 2% of their assessed value "on average." We could live with that. But we turned out to be above average and lost 10%--a distinction we could definitely have lived without. (No, county assessments are not the be-all and end-all in pricing a house. But they play a role. Banks look at them when deciding on approving a loan. Your price can't be too far afield.) The new numbers made it clear that after paying the $330K second mortgage, we wouldn't be able to build a house we'd want to spend the rest of our lives in, and at that point, that beautiful scrap of land whose picture you see at the top of the page became a liability. Paying for it became the obstacle to building on it. As much as we love everything about the place, the debt was no longer a manageable inconvenience, but a monster. In order to do anything at all with the profit from this house, we would have to retire that second mortgage, and the only way to do that was to sell the land. But that had potential problems, too.

The prospects for getting what we needed for the land were by no means bright; its value has diminished by one-third since we purchased it. We knew that selling it on the open market would be useless, but we had one possible place to turn. Our neighbor, whose land adjoins ours, had always wanted our parcel. In fact, just before we made our purchase in 2004, he had made a cash offer to the previous owner. The owner accepted--until his daughter-in-law, a real estate agent, talked him into putting it on the open market. He did, for a few dollars more, and we bought it at that higher price. (We of course had no idea of these dealings at the time.) Our neighbor was disappointed, to say the least, and told us repeatedly over the years that if "anything ever happened," and we decided we wanted to sell, we should go to him first. We kept that in the back of our minds, but never really believed we'd have to take him up on his offers, and they gradually subsided as our building plans firmed up and we shared them with him. He seemed to be resigned to never having the land; we had no idea if he was still interested, or what he would offer if he was.

Well. He offered us $300,000. He originally said he had $280,000 in cash and didn't want to go into any more debt but then, as he spoke and we merely listened, he talked himself up. I was flabbergasted. This was what's called grace, an unexpected, undeserved gift. I'd say it was from heaven if I believed in such a place. We will never be able to thank that dear man enough.

Still, all is not roses here at the moment. Steve is still dealing with the shock of losing this dream. He is, after all, the one who has been absorbing sucker punches for over a year: the loss of a good pension and then a forced retirement because of the loss of his job. When the job ends, so will his medical insurance, except for COBRA, which is prohibitively expensive. If our dear Barack doesn't change the rules and allow federal retirees to include domestic partners in their health coverage, Steve will have to get some kind of job just for insurance, but he can't think about that now. He's working hard at the office at a job about to end, and then working hard here at home, too. From his standpoint, the future doesn't look very bright, and he is depressed. I can only pray that soon he will be able to see the silver lining that I do, which is:

In about two weeks we will be clearing the better part of our huge debt. We hope to be able to restructure the remainder to improve our cash flow as Steve's job ends in June and we begin to live at about half our current income. The plan, at least now, is to go ahead and put the house on the market and see what the offers are. If they're high enough, we'll proceed, take full profit, and start looking for new places. If we deem the offers too low, we can take a breather from all this and stick around for another year or so to see if conditions improve. We feel like Delaware residents by now and would love to stay there, but we're open to anyplace that has nice land or nice homes on the waterfront that we can afford. Stay tuned.