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Malibu Madness


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2005 Aug 3, 1:29pm   27,818 views  162 comments

by HARM   ➕follow (0)   💰tip   ignore  

"For sale: Trailer w/ocean vu, $1 million obo "
Yahoo News: tinyurl.com/9eh5l

So wonderfully Californian, Marsha Weidman's home has it all--along the beach, far from noisy traffic, with a Jacuzzi used to watch sunsets over the Pacific.

For this, she and her husband recently paid $1.05 million.

For that, they got a trailer, built in 1971, without any land.

Plus, the family must pay "space rent," which at two Malibu parks dotted with seven-figure trailers ranges from $800 to $2,500 monthly.

So... Is this a great deal or what?? After all, this is prime beachfront in MALIBU, people! Some pretty big PIBs (Positive IntangiBles) here, no? Discuss.

HARM

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1   praetorian   2005 Aug 3, 1:39pm  

I'd say something like "The heart has reason's the head knows not," but, umm...

Tools. Complete and utter.

Cheers,
prat

2   Zephyr   2005 Aug 3, 1:40pm  

If the land lease never expires the price may not be so bad. However, I understand that these trailers have no land lease. Certainly not where I would put any of my money.

3   HARM   2005 Aug 3, 1:42pm  

Hate to "steal" content from Ben's blog, but he had a thread on the same story, and I just had to share this post:

Anonymous said...
I have a north face 4 person expedition tent for sale only $750k. Includes air mattress, sleeping bag and porta-potty.

Will lease the buyer a spot on my back lawn with an ocean view for $2500 a month.

4   HARM   2005 Aug 3, 1:47pm  

Zephyr,

Well... I can actually speak from some personal experience on the subject of mobile homes & pre-fab. I had to sell my dad's MH 4 yrs ago, and I had even considered having a new one built for myself on raw land.

There's a very good quality MH manufacturer in Corona, called Silvercrest. The new ones actually look like real stick-built houses for the most part, unlike the one's they were building back in the '70s. The very top of the line 3-4 bdm. models they have cannot set you back more than maybe $200K, even throwing in top-of-the-line appliances and granite coutertops.

Paying $1million+ for a 1971 mobile home on land you have to rent is INSANITY.

5   Zephyr   2005 Aug 3, 1:50pm  

These trailers were featured on a travel or dicovery channel show a while back. They are really just modest houses, not real trailers. There are other similar parks in many other places.

While the cost is considerably lower than buying a comparable house on its own lot, these trailer houses have no title to land. When I buy property I look to invest in land value not structure. You get no land with these trailer/houses, only a rental of a space. No thanks!

6   HARM   2005 Aug 3, 1:54pm  

When I buy property I look to invest in land value not structure. You get no land with these trailer/houses, only a rental of a space. No thanks!

Thank you!
Btw, if anyone's interested in what the new house-like mobilehomes I mentioned look like (the ones that cost MUCH less than $1million), here you go: tinyurl.com/96zv2

7   Zephyr   2005 Aug 3, 1:55pm  

HARM,

Yes, I understand that some of these trailers can be very nice and actually luxurious. But, I consider them to be a form of construction. I would never be tempted to put so much investment onto a plot that I did not own. At the very least I would want a very long lease (50+ years) that provided benefits comparable to owning.

8   HARM   2005 Aug 3, 1:59pm  

Zephyr,

We completely agree on this. The main reason I decided against building one of these is it was so hard to find an affordable plot of raw land I could actually buy within reasonable commuting distance to work. Actually when you add up all the costs of permits/fees, running utilities, sewage lines, etc., it didn't come out much cheaper than building a regular house. And regular stick-builts are much easier to finance.

9   Zephyr   2005 Aug 3, 2:04pm  

I think I would go with a factory prefab/modular construction rather than a trailer.

10   Zephyr   2005 Aug 3, 2:07pm  

I understand that quite a few celebs own trailers at this Pt. Dume Park. They sort of epitomize brainless money in my estimation.

11   KurtS   2005 Aug 3, 2:23pm  

Omg, that's perhaps the stupidest thing I've read!

12   AntiTroll from Oz   2005 Aug 3, 2:35pm  

WOW,
This will open up a whole new market.

Imagine, Mobile offices in New York. Migrate your business into trailers, and you can take your office with you to see customers, they will be impressed.

Even better, can they be stacked on top of each other to make high rises?

13   SQT15   2005 Aug 3, 3:15pm  

Gives whole new meaning to the phrase 'trailer park trash.'

14   HARM   2005 Aug 3, 3:16pm  

“One-liner as thread” ?

Well, Jack, I grant you it's not the most thought-intensive thread so far.
To be honest I'm getting a little burned out. If you --or anyone else-- has a good topic, post it here and I (or SactoQt or Peter P) will turn it into a new thread. If Patrick's back, he can also make you a threadmaster.

15   AntiTroll from Oz   2005 Aug 3, 3:20pm  

An idea for a new thread.
How about valuations.
Pick a house that is listed (with pictures) and we can discuss what a fair value for the property would be?

16   HARM   2005 Aug 3, 3:21pm  

Gives whole new meaning to the phrase ‘trailer park trash.’

At $1million+, maybe we should call them 'eccentric hoi polloi'.

17   HARM   2005 Aug 3, 3:28pm  

AntiTroll,

Not a bad idea. Actually, there's no reason why we can't do that right here. As Jack already pointed out, the hook for this thread's a bit thin.
(One possible drawback: most of us may run the numbers through the CEPR & Dinkytown rent vs. buy calculators & come up with close to the same values).

18   SQT15   2005 Aug 3, 3:29pm  

(One possible drawback: most of us may run the same numbers through the CEPR & Dinkytown rent vs. buy calculators & come up with close to the same values).

He did say 'fair value.' Debating that could be kind of comical.

19   HARM   2005 Aug 3, 3:42pm  

@Suds,

Np --let the idea percolate for a while. Think of some specific points/questions you'd like discussed and see if you can find 1 or 2 good links on the subject. When we reach the 'magic 200' mark, post it here and one of the threadmasters can generate it for you.

20   SQT15   2005 Aug 3, 4:03pm  

My mom told me about these mobile homes a couple of months ago, and I thought it was totally ridiculous, and it is. I have to wonder what the whole attraction is. Is it simply to be on the beach? Obviously if you can spend $1 million for a mobile home, you can afford to buy something decent elsewhere. I wonder if it's a typical LA thing. Has it become trendy in a weird sort of way, so people buy in thinking they'll be trendsetters or some nonsense like that? Or it could be part of the thinking that has the sheeple surveyed in LA saying they think the market is going to continue to go up 20% a year for the rest of the decade. Can you image? $2 million+ for your crap mobile home on land you don't even own. I'd say 'only in LA' but I'm afraid this kind of stupidity is catching.

21   AntiTroll from Oz   2005 Aug 3, 4:14pm  

Can you imagine .. 2025

Tent for sale. Airy with views where ever you can pitch it.
bargain $2m. Carry bag negotiable.

22   SQT15   2005 Aug 3, 4:18pm  

Can you imagine .. 2025

Tent for sale. Airy with views where ever you can pitch it.
bargain $2m. Carry bag negotiable.

For an extra $500,000 we'll pitch it for you.

23   SQT15   2005 Aug 3, 4:26pm  

Jack

We must talk ameneties....

Actually, I would like to see the inside of one of these mobile homes. I mean, what should a $1 million mobile home look like? If it was built in 71', is it a 'refurbished' mobile home? If so, what does that mean?

24   SQT15   2005 Aug 3, 4:29pm  

But it has a jacuzzi, so that $1 million price tag can't be too inflated.....

25   SQT15   2005 Aug 3, 4:38pm  

Nite Jack. I'll sleep on some thread ideas too.

26   Peter P   2005 Aug 3, 5:13pm  

How about PRIME locations on granite mountains? Your tent can have as much granite as you want.

On the other hand, absolute madness is an absolute sign of the end.

27   Peter P   2005 Aug 3, 5:48pm  

As I understand it, they basically bought the right to rent that space in the park, right?

Exactly. They want a Malibu address.

What if the trailer park owner decides to develop the land in the near future? Oops!

I rather buy the right to rent my current apartment for exactly $0.

28   AntiTroll from Oz   2005 Aug 3, 5:51pm  

Scott:-
Unforturnately I am from downunder, and unfamiliar with your tax laws.
I am a natural sceptic and maybe the financial could be viewed creatively:-

Right to beach front view $50,000
34 year old trailer (onsold to family business) $950,000
Rent per year $24,000

Since the trailer was onsold to business at no profit you have no capital gains.

The company carries a depretiating item (vehicle) as a tax deduction or offset on other capital gains.

29   Peter P   2005 Aug 4, 2:16am  

As an investment property mobys are perfect, by the way. The old ones in particular.
- $50k purchase price
- finance it with an existing heloc @ 5.75%.. around $350 a month will pay it off
- upkeep won’t be that much, maybe $30 a month
- space rent $250 / month (includes tax)

- Total expense: $630 a month
- Rent income: $800 a month

The rate of return (4.08%) looks awful, considering that mobile homes tend to depreciate over the long term. (I know you can deduct depreciation)

Anyone know someone who buys aircrafts and rent them out and get positive cashflow? I heard that aircrafts appreciate over the long term.

30   Peter P   2005 Aug 4, 2:25am  

Sorry for my bad grammer today... need proof-reading.

31   Peter P   2005 Aug 4, 3:37am  

I am expecting more mobile park closures because of institutionalized greed. BTW, I consider mobile home living to be the worst of both worlds (buying and renting).

32   HARM   2005 Aug 4, 3:41am  

I thought the lead story for this thread was really plumbing the depths of bubble-insanity. Boy, was I wrong...

LA Times Real Estate Page 1 news:

"Bad Lands Now Hot Property"
tinyurl.com/czyt6

VALENTINE, Texas— For 19 miles, most of it bumpy enough to shake your bones, State Route 2017 runs down to the Rio Grande and the Mexican border.

Drug smugglers and illegal immigrants pass through here. So do the Border Patrol agents that pursue them, and cowboys heading to a nearby ranch. No one else bothers. The land is sandy and bleak, full of gullies and rattlesnakes.

Yet this parched ground is increasing in value faster than any Manhattan duplex or Malibu villa.

In February, a California entrepreneur bought 7,408 acres for $65 an acre. He promptly sold them in small chunks to some people and in big chunks to others. Some of these buyers quickly resold to others, who resold to still others.

The pieces keep shrinking while the price keeps going up. Buyers are now paying as much as $800 an acre, 12 times the cost six months ago.

At the county clerk's office in Fort Davis, the county seat, they long ago lost track of how many new landowners Valentine has. They definitely dwarf the hamlet's population of 217. The best guess is a thousand.

There are thousands of other new owners all over sparsely populated West Texas. Nearly all the sales are for raw, undeveloped land, bought over the Internet or at seminars in distant cities.

Most of the buyers are from California, Florida, New York and other places where the cost of homes has been surging. People on the coasts, who have to spend a fortune for somewhere to live, are spending more for somewhere they can't.

After four years of real estate mania, the message has sunk in widely and deeply. Land is good. More land is better. Land will always increase in value. Every moment you don't buy you're losing money. No need to see it before buying.

There's no need to even see a photo. The most aggressive Internet auctioneers post a picture of land as lush as Ireland, and then warn on the photo itself that it has no relation to what's up for bid.

...The most worrisome prospect: The buyers think someone's going to live here, despite the absence of water, electricity, sewers, roads and other amenities.

"You could live there in a tent, if you could find your land," said Jeff Davis County Clerk Sue Blackley. "But you'd have to helicopter everything in."

33   Peter P   2005 Aug 4, 3:46am  

Well, I guess they can build a town to serve "Border Watch" vigilantes. Or when the climate changes (The Day After Tomorrow?), people migrate to Mexico in droves. They can charge a toll.

34   HARM   2005 Aug 4, 3:56am  

Well, I guess they can build a town to serve “Border Watch” vigilantes.

Hmmm... I'm not so sure that nonviolently patrolling your county's borders (something the federal government steadfastly refuses to do) constitutes "vigilatism". I was thinking of joining one of the groups here myself, "Friends of the Border Patrol", founded --I might add-- by a latino, Andy Ramirez.

This could provide a name for the new settlement, though: "Minuteman Flats".

35   Peter P   2005 Aug 4, 4:06am  

HARM, I totally support the border watch program. It is just that for some reason the federal government calls them "vigilantes". I guess I have misplaced the quotes. It should have been Border Watch "vigilantes".

36   HARM   2005 Aug 4, 4:15am  

Np, Peter (had me worried there a sec ;-) ).

A lot of people are hearing the reflexive "V" label and "rascism" charge from left-wing immigrant-activist groups, which then gets picked up and looped by the press and so on... Although some of the groups have attracted a, shall we say, "stridently nativist" element, I believe they are a very tiny minority and get weeded out quickly.

37   HARM   2005 Aug 4, 4:25am  

@Nanter,

So, do you view the desire to see our nation's border laws enforced as vigilantism? I'd call it civic activism and common sense.

38   HARM   2005 Aug 4, 4:29am  

Nanter, btw I'd prefer the government do its job and patrol the borders. Unfortunately, in reality what we have is an open-door (or more accurately an open "back-door" policy) that benefits agri-business, hotels, construction, etc. to the detriment of our infrastructure, tax base, wages and overall standard of living.

I am *not* against raising immigration "quotas" or abolishing them altogether. I don't agree with tacitly rewarding habitual law-breaking, however. And I think that applies as much or more to the businesses that exploit poor immigrants as the immigrants themselves.

39   HARM   2005 Aug 4, 4:50am  

if you speak Spanish, watch Univision News Channel, they show how these “patriotic” bastards shoot children now.

Max, Nanter,

If actual registered Minutemen were really shooting children, wouldn't this be splashed across every newspaper in the country? (L.A.Times/La Opinion would love for this to happen, I'm sure.) This would immediately discredit the whole movement, so my guess is these stories are either (a) bogus agit-prop, or (b) about unaffiliated rascist morons who claim to be "minutemen" but are really acting alone.

Anyway, you're right --we're getting OT here. Welcome to the blog!

40   HARM   2005 Aug 4, 5:26am  

Nanter, thanks for the intro.

I'm a 37-yr old IT guy renting in an L.A. suburb, facing an almost identical dilemma. My wife & I want to leave SCAL for better quality of life/cheaper housing/less population density, traffic, etc. But, as they say, "you better take your job with you." Starting over in a new place (much less a career change) is hard but often necessary when we want to improve our lives. I wish you success.

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