Snow

Snow is a part of life here in Minnesota.  I don’t mind it for the most part, except when I’ve got to shovel a large amount of it or drive on slick roads.  The landscape right after a snowfall is pristine, and quite beautiful to me.  It covers up things:  brown grass, or a child’s toy absent-mindedly left in the yard.  It can also reveal things:  animal tracks, or a deer silhouetted in woods where it could previously roam unseen.

The snow reveals something else as I move around my neighborhood.   We’ve had several snowfalls in the last week.  Some folks are fastidious about shoveling their driveway off (that includes me, usually); some not so much, and some just don’t bother at all.   The lazy ones just drive over the snow and mash it down to the point that it’s a hard, slippery mess.

The interesting thing lately is that there are several houses where the driveways haven’t been shoveled yet are still in pristine condition.  No tire tracks or footprints have marred them.  The lights are always off, and there’s no ‘for sale’ sign in the yard.    Back in the fall, I thought we had a few empty houses in the development.  Now I am sure of it.

Another resident in my development is a mortgage broker, and he’s also active in the local Cub Scout unit.  We chat once in a while about the housing market, since it affects both of us in admittedly different ways.  He confirmed to me that we’ve had at least seven foreclosures or short sales in 2008, and that several houses in the development are bank-owned and empty.  There’s no signs in these yards, so I am assuming the lenders are being patient waiting for a better market to come along.  Good luck with that.

At least a few of these houses have been trashed by their former occupants.  I’ve heard stories of missing appliances, walls beaten to crap, missing fixtures, etc.   That’ll do wonders for the average sale price in the neighborhood.    This isn’t necessarily a bad thing from my perspective.

Ignoring the macro-economic arguments for a housing price reset, I have two silver linings to the local meltdown in pricing:

First, my property taxes will go down to one degree or another.  I’m not planning on moving anytime soon, so the lower assessed value will help my pocketbook to a certain degree.  It’s better than having them shoot farther up if nothing else.

The second silver lining is more convoluted.   Based on conversations with several brokers I know, I’m pretty sure I have lost most if not all of the equity in my house… at least for now.   Normally this would be distressing to most people, but I’m taking a more philosophic view of things.  From my point of view, I am a bit more free than I used to be.

The money I put into the house was never really mine in the first place.  It was ‘equity’ that I took from the old house to the new one.  I can’t say I ‘earned’ it other than the fact that I managed to buy my previous house towards the beginning of the housing bubble and managed to hold on for a while.     Since I never had the money in my bank account, it was never real to me.    I could have extracted some via a home equity loan at some point in the past, I suppose.   Now that’s not an option.

The freedom bit comes from the fact that I no longer have to worry about protecting ‘my money’ that’s currently tied up in the house.    If the economy truly goes in the toilet, I won’t have to worry about what machinations I would have to execute to try and extract that ‘equity’ from the house.   The money isn’t there, and if the shit hits the fan, I am free to do what I need to in the best interests of my family without being held back by the thoughts of walking away from ‘all that cash.’

It’s a somewhat surreal thought process, I grant you, but that’s what occurred to me.   It’s funny how something with no intrinsic value like the US Dollar can have such a hold on us.   A buck has value only because enough people think it has value…  and that is enough to get people to lie, cheat and kill to get more of them.  We build these mental prisons for ourselves constantly…. and it’s refreshing when we get a small taste of freedom from one of them.

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