Real Estate Values Update – Third, The Golden Turd

As I mentioned in the first two posts of this little mini-series, it’s been more than a year since I updated the values of any of our real estate holdings and they have shifted non-trivially since then.  In elementary playground fashion, I have decided to present them in order as “investment successes” according to the elementary school playground song:

“First – the worst! Second – the best! And third is the golden turd!”

Luckily, this order also happens to be the order in which we bought the properties, so if you prefer not to think about what a golden turd actually is, you can just think of the order as “chronological”. =)

imgp0142lighthouseam

Lighthouses at Burning Man-pretty, but not the type of Real Estate we bought!

Catch up on earlier posts if you missed them:

And I’m going to keep saying this…

Something to keep in mind when looking at these: We bought properties during the depths of the foreclosure crisis in one of the worst-hit metro areas in the entire country. As a result we’ve seen some pretty significant market value gains since our purchases and don’t expect these increases to be representative of what we’ll encounter in the future, either here or elsewhere.

So lastly, we have…

Third, the Golden Turd: Our Investment Lot:

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Real Estate Values Update – Second, The Best!

As I mentioned in the first post in this little mini-series, it’s been more than a year since I updated the values of any of our real estate holdings and they have shifted non-trivially since then.  In elementary playground fashion, I have decided to present them in order as “investment successes” according to the elementary school playground song:

“First – the worst! Second – the best! And third is the golden turd!”

Luckily, this order also happens to be the order in which we bought the properties, so if you prefer not to think about what a golden turd actually is, you can just think of the order as “chronological”. =)

Catch up on Part 1 – First, The Worst – Our Primary Residence here.

Something to keep in mind when looking at these: We bought properties during the depths of the foreclosure crisis in one of the worst-hit metro areas in the entire country. As a result we’ve seen some pretty significant market value gains since our purchases and don’t expect these increases to be representative of what we’ll encounter in the future, either here or elsewhere.

But for now, we’re on to…

Second, The Best – Our Duplex

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Real Estate Values Update – First, The Worst

Property valuation is an inexact science. It can look quite exact – especially when Zillow sends an email saying your Zestimate has increased $1,750 to $305,649 in the past 30 days.
screen-shot-2016-09-11-at-8-15-31-pmTrouble is, this is a classic example where precision does NOT equal accuracy.

But fret not!  A lack of total accuracy doesn’t mean that you shouldn’t keep an eye on the value of a property, especially if it’s a property you’re willing to sell or otherwise extract value from (as at least two of our properties are). It just means you should be comfortable with accepting a range of values, and if you need to narrow it down to a single number, use your best judgement about what number in that range to use, knowing full well it’s probably off somewhat.  With assets like these, the value can’t *truly* be known until it is sold.

Our Updates Are Overdue

It’s been more than a year since I updated the values of any of our real estate holdings on our balance sheet. But it’s getting to be about time to do so again since (by our best estimates) the values have started to shift in a non-trivial way.  All three properties are a bit too much to put in one post, so this is going to be spread out over 3 posts.

In elementary playground fashion, I have decided to present them in order as “investment successes” according to the elementary school playground song:

“First, the worst! Second, the best! Third is the golden turd!”*

Luckily, this order also happens to be the order in which we bought the properties, so if you prefer not to think about what a golden turd actually is, you can just think of the order as “chronological”. =)

Something to keep in mind when looking at these: We bought properties during the depths of the foreclosure crisis in one of the worst-hit metro areas in the entire country. As a result we’ve seen some pretty significant market value gains since our purchases and don’t expect these increases to be representative of what we’ll encounter in the future, either here or elsewhere.

Without further ado:

First – The Worst: Our House

Continue reading Real Estate Values Update – First, The Worst

PoP Balance Sheet – August 2016

Welcome to our August 2016 Balance Sheet!

We use the structure of a monthly income statement and balance sheet in tandem to make sure we are keeping our expenses low and planting our pennies wisely. If you’re not already tracking your finances using these two methods, go to mint.com and get started today! If you have any questions about how we do this just post a comment and we’ll be sure to help!

Not a lot of action on our balance sheet this month.  The market was pretty flat, and I’m holding off on raising the values on our real estate (they’re all a tad overdue) until I get a chance to post some thoughts on each of the properties.  So, this month the only changes are from some minimal market movement and savings.  Boring, but not bad.

Here are the numbers for August:

  • Our total assets went up by $8.8K 
  • Our total liabilities went down by $0.8K 
  • Net worth went up by $9.7K 
  • Total net worth as of the end of August is $1,080.7K, which represents a 0.91% increase this month.

For the details…

Continue reading PoP Balance Sheet – August 2016

PoP Income Statement – OMG August 2016!

Welcome to our August 2016 Income Statement!

Mr. PoP and I put these income statements together for two reasons. First, we want to be transparent about our finances because we’re trying to be role models for other people who are trying to plant their own pennies (and end up with dollars someday!). Second, we do this to make sure we’re on track to meet our own long-term goals. If you’re not tracking your income statement and balance sheet, we highly recommend you start using a program like Mint to keep track of it all.

A quick “Happy Friday” (for us) that Hermine dodged us in her path.  Though I hope everyone further north in Florida is safely tucked away as it’s my understanding that she’ll land (well, she should have done that by the time this goes live) as the first hurricane to hit Florida in over 10 years.  That’s right – no hurricanes have hit Florida in the decade that we have lived here

not sure what to cap.As for our income statement this month, Mr PoP is off at Burning Man, so you, dear readers get a look at the full horror show that is our August 2016 spending before he even does.  I did, however, give him a heads up before he and his friend drove off into the desert in search of adventure and god only knows what else.  (I mostly jest; I really am glad he’s getting the chance to go on this trip that he’s been dreaming of taking for more than a decade.)  

In the previous 50 months of Income Statements that we have published here on our blog, there have only been 3 that have been more expensive than this month.  

  • February 2013 – $10,424 in expenses when we paid the remaining balance (nearly $7K) on our car loan
  • February 2015 – $9,988 when we booked nearly $6K in non-reimbursable expenses for installing our solar energy system on our home
  • June 2015 – $9,178 when in the midst of our renovations, we purchased enough tile to retile the entire house…

Unlike those months, though… this month doesn’t really have a large capital improvement on it.  But what it does is cross a huge item off Mr PoP’s bucket list.  

With our yearly pest control bill coming due, and me incurring medical costs to the tune of over $500, it wasn’t going to be a cheap month to start with.   But then adding on over $2300 in expenses for Mr PoP’s trip to San Francisco and Burning Man, along with a brand new top-of-the-line Pentax DSLR ($930!) that he bought to accompany him on the trip.  He’s wanted the camera for a while, opted for the brand new model, and he really wanted to take it to Burning Man, so the timeline got a little accelerated there.  

Short term, it’s a lot of cash going out the door.  But there’s a good chance that we’ll see some come in over the next few months that will cancel out some of those expenses.  You see, Mr PoP is in the process of selling a couple of vintage collectibles that belong to him but have been at his parents’ old house since we moved to Florida 10 years ago (link to anniversary post).  He’ll use that money to net out the cost of his camera, so we’ll credit it to a future month’s shopping budget when it comes in.  

I also expect that we’ll see some sort of reimbursement from Mr PoP’s friend for the shared joint expenses that we have covered so far for Burning Man (ie tickets, shelter – a hexa-yurt!, swamp cooling setup, and a truck rental to get everything into the desert from San Francisco).  That was over $2K in expenses right there, and I think represents most of the joint expenses for the two of them.  My guess is this means that Mr PoP’s friend is going to end up reimbursing us for about $1K of that, and that’ll end up getting credited to our travel sub-ledger when it happens.  

So… if you assume that we’ll have $2K (for the collectible sales and half of Burning Man shared expenses) coming back to us, our expenses for this month would only be “definitely higher than usual”, not “OMG” high.  Not a huge consolation, but I’ll take it.  

Either way, this is not turning into an inexpensive year in the PoP household… but it is a year when some big (and rather expensive) travel urges have been scratched.  And honestly, by the end of the year, we’re both pretty sure we’ll be okay being home bodies for a little while.  

Anyhow, here’s all the dirty detail of the horror show that was PoP August 2016 spending.  

The Bottom Line

  • Earnings before principal paydowns and savings allocations of $3,630.  

And the details…

Continue reading PoP Income Statement – OMG August 2016!