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Lesson #1: Real Estate Always Has Value

Lesson #1 in this blog series is “Real Estate Always Has Value”.

vale rd

My first lesson in real estate came in 1975.  I was in preschool, but I remember it well.  My father built four houses on Vale Road in Oakton Virginia for a developer.  The market was down and the developer couldn’t sell the houses, which meant he couldn’t pay my dad.  So he said to my dad, “Bill, I know I owe you the money.  You can sue me if you want.  But even if you win, I can’t pay you.  I simply don’t have the money.  Why don’t you take a house and we’ll call it even?”  My father was none too happy about this proposal, but he needed the money, and he could “purchase” the house and take a mortgage on it to pay off his suppliers.  And so that’s what he did.

That’s the story of how my parents were forced into homeownership in their 20s.  It led to many good things for them in the long run, but the immediate lesson I got from this was “Real Estate Always Has Value” .  You may have to be creative about how to leverage that value, but real estate always has value… unlike some other financial investments you might be thinking about making.

Pictured above is a picture from the 2010 listing in the MLS for the house my father acquired in 1975.  It’s located at 12046 Vale Road in Oakton.  The appraised value at that time was $106,000.

 

 

3 Responses to “Lesson #1: Real Estate Always Has Value”

  1. May 04, 2013 at 3:17 pm, Lesson #2: Pay Down Your Debt | Dulles Area Real Estate and Homes said:

    […] long after my parents acquired their first home, my grandparents paid off their mortgage.  Much like depicted in the video above from an Archie […]

    Reply

  2. May 06, 2013 at 11:47 am, Lesson #5: Appreciating Real Estate | Dulles Area Real Estate and Homes said:

    […] Remember this house?  In 1975 it’s appraised value was $106,000.  It last sold in 2011 for $560,000.  That’s approximately a 4.8% average annual rate of return. […]

    Reply

  3. May 06, 2013 at 12:54 pm, Building Wealth By Owning Real Estate: Five Lessons for Us All | Dulles Area Real Estate and Homes said:

    […] Lesson #1: Real Estate Always Has Value:  It was 1975, the market was down and the developer could … […]

    Reply

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