Would it? Living wood isn’t going to rot. Is it possible to treat a whole tree?
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Did the owners not have insurance?
Or are the insurance companies being bastards?
I recently had to find new homeowners insurance as the company I had notified me that they are not renewing because I supposedly live in a wildfire zone. I can literally see a fire station out my front window.
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Anyone rich enough to buy it is probably rich enough they’re going to knock down whatever was there and build their own McMansion. This just means half the work is done for them already.
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No, the land under the house is being sold for $500k (or close to it).
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A distinction without a difference… 
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Absolutely! It would be wise to remove the bark, but otherwise, there’s no difference between this and full timber construction.
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Getting insurance for a house where a tree intersects the structure is difficult and expensive. You may like the effect, but do you like it $800/year?
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Well, yes, I realize both are being sold together. But, I don’t think it is a distinction without a difference in this case? If it were an empty lot with a driveway and utilities, it would still be far from free. In some cases a structure makes a lot less valuable than it otherwise would be, if it is in such bad shape the new owner will need to pay to tear it down. It’s also important for when you want to estimate how much a change to your property will affect its future market value.
I think it’s important for people to know what they are actually paying for when they buy a home, because it is at least two different things at once.
Sometimes people who don’t understand that end up getting into trouble later on, like if they buy a manufactured home and place it on a site they “bought” in a campground or trailer park, and then the park changes hands and suddenly they have to find a new site and pay tens of thousands of dollars to move (and often damage) their home, or else lose it.
Similarly, if I were buying a condo, it would be good for me to know how much of the purchase price is the value of my own unit (what I will personally control) and how much is the value of my ownership share of the community property/building/land. That can affect financial decisions I might be faced with later on.
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Yes, but cheaper than this. It’s true that part of this is absolutely the cost of land, but it’s not just that. Most of us are aware of the complexity of the housing market…
However, MOST people are buying a house to live in, not just as an investment in land. The fact that the home on the property is utterly destroyed (the thing most people who are investors would actually want) is the key issue here, not some abstract financial investment…
This is, frankly, part of the reason housing costs are out of control, because some tiny sliver of the population treats it like a fucking commodity and actively seeks to drive up costs to corner the market, the rest of us be damned. They’re just fine with the homeless crisis, because they see it as an acceptable cost for them getting wealthy.
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I can see little kids (while grownups are out of sight) ignoring the steps and using the projecting stubs to go up and down. More than enough ‘meat’ there for little hands and feet.
I mean, yes to all of that. There are so many things that make housing costs artificially high as you describe. It’s ridiculous.
But also, this is by far the smallest lot and cheapest house in the neighborhood. That pretty much always means its price is being inflated by the price of the houses around it, which is a matter of land value, not house value. People who buy it are buying it to own a house in that neighborhood.
The cost to build this size house, brand new, would be <$200k, by quite a bit. That would be basically an upper bound on how much of this price could, in principle, be the value of the house vs the land. Obviously given the condition it’s even more skewed - the house has depreciated a lot. There’s also lots of value in the fact that it’s probably much easier to get permitted to fix it up than it would be to build or renovate otherwise. That’s part of the land value, too.
TBH I suspect that if, tomorrow, a bulldozer accidentally flatted the remaining structure, the market price would go up. The people who buy seriously damaged houses are either investors, or people with enough money and time to build who like the location.
So yes, I do think it’s important to recognize that most of those things artificially inflating home prices? They’re driving up land prices, not house prices. Without them, someone who owned a house on a 1 acre lot could, in many cases, build several ADUs and create cheaper housing while raising the total value of the community, but they’re not allowed to. That makes the price of every home higher because of artificial scarcity limiting the number of lots/units. There are some rules making actual house prices (construction costs, for example) artificially high as well, but these are (IIUC) a much smaller part of the problem in the most expensive markets.
This helps us think a lot more clearly about which kinds of rule changes and interventions are actually likely to be effective at making housing more affordable. Also, about the value of things like remote work letting more people live in places with cheaper land.
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Insurance companies refusing to issue policies is quickly becoming the new capitalism fuckery that mostly impacts the middle class. Many big insurers are leaving entire markets completely which forces homeowners to pay extortionist rates with 3rd rate fly-by-night companies. And many HOAs are passing along upwards of 700% rate increases to homeowners. My community had a $6000 per unit special assessment last year just because of insurance.
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Once again, most people who aren’t investors are looking to buy a house, and it’s a market for housing. Yes the land is part of the cost, but most people care about the house… So, I’m a bit unsure what the point of the hair splitting is, especially when most of us are well aware that land plays in role in the cost of housing, especially in a city like LA… But presumably, the HOUSE is what is listed, not just the land…
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I’m very aware that you understand how this market works, but I really don’t think I’m hairsplitting here. I actually think it’s misleading in this instance to describe what’s being sold as a $500k house. I think that large majority of what’s being sold is a lot where someone can fix up or build a house. The current structure is almost irrelevant for determining the price at this point. It’s certainly illustrative of how F’d up the local real estate market is, that a tiny lot costs that much!
I guess maybe I just see lot’s of discussions of housing markets and housing policy where people really don’t understand how the rules and market dynamics work, that I’m a bit too quick to think in these terms.
So, you think I understand and also don’t understand…
Okay. Whatever.
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IIRC that is how the housing market works in Japan. Houses are usually designed to last only twenty to thirty years, and are depreciated like cars. When the property is sold, the price is based on the valuation of the land as an empty plot. The old house is just a thing sitting on the land which the new owner will want to get rid of.
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Having your own house custom-built to your specifications is part of the Japanese Dream. And there’s a big, competitive industry of custom homebuilders to do it for you. There are a lot of property developers building cookie-cutter houses as well, but the existing structures get torn down either way.
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You’re not in the group of people I think don’t understand how the housing market works.
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Yes. the answer is always Yes.
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Clearly, what’s being sold is a $500k tree.
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