Several years ago, I left the banking industry to try my hand at real estate until I found a real job.
Saturday, I will celebrate the 40th anniversary of that decision. It is unfathomable that the past days have spawned 40 years, but it happened.
The real estate world was different in 1979. Back then, contracts were two pages long, one for FHA (Federal Housing Administration) and the other for homes purchased using loans guaranteed by the Veterans Administration. At that time, VA and conventional loans were unusual in Nashville.
We seldom used the second page, so everything required to purchase a home was written on one page.
Why would anyone In Nashville need a conventional loan when FHA and VA allowed buyers to borrow as much as $93,750? In 1979, I lived with Lee Williams, a childhood friend and high school classmate, who had entered the real estate field with C&S Builders, a construction company that specialized in FHA 265 and Farmer’s Home Administration loans. It was Lee who led me into this jungle.
These C&S homes were built in Fairview, Smyrna, White House, Gallatin, Portland and other rural areas. They were 1,500 square feet with three bedrooms, two baths and septic tanks. If the lot sloped, they had basements. Those were $2,500 extra.
The buyers could earn their own down payments by performing sweat equity on their homes, applying their talents to painting, cleaning, seeding and strawing the yards, and then planting some shrubs in hopes they lasted until the appraiser arrived.
The houses sold for as much as $32,000, and the payments would have been nearly $400 per month without the government subsidy of more than half that amount.
With the assistance, the payments usually came in at $185 per month.
In the case of Farmer’s Home Administration loans, the subsidies were higher and payments lower, often as low as $100 per month.
When Ronald Reagan took office, he put an end to those programs, and C&S went into hibernation.
Its founder and president, one John E. (John Eddie) Cain, was not ready for retirement, so he retooled the company, which emerged as Fox Ridge homes. It would soon dominate the industry in subdivisions closer to Nashville.
Cain initiated loan programs utilizing newly created adjustable rate mortgage (ARM) in the early 1980s when interest rates hit 18 percent. Lenders instituted an advertising campaign featuring a dog named WOFFY (“Way of Financing For You”). The housing industry welcomed buyers with open ARMs and the consumers embraced them.
The homes featured cathedral ceilings – rare at the time – along with split bedrooms, a master suite on one side and two bedrooms with Jack and Jill bathrooms across the great room from the master suites. Fox Ridge made the decision to forsake the ranch style house.
Cain sold the company for millions and later repurchased it for considerably less than the price he had received. After once again righting the ship, he sold the firm for a second time for a higher price, according to sources familiar with the three transactions. He remains active in development and construction, and Lee Williams remains the business with the Williams Company in Brentwood.
Now real estate contracts are 29 pages long with all the disclaimers, disclosures and other documents. FHA loan limits for this area are $684,450 and can reach $726,525. They are not as popular as conventional loans because they include fees that conventional loans do not have.
It’s been a fun run. I can’t wait to see what the next 40 years bring.
Sale of the Week
The 1212 luxury condominium tower at 1212 Laurel in The Gulch was predicted by many to be the condo version of the Titanic. It seems to have safely flipped the ending.
Last week, one of the penthouses sold for $2.125 million, yet another sale boasting more than $1,000 per square foot. The 1,951-square-foot unit sold for $1,089 per square foot. With two bedrooms, two full baths and one half-bath, it took the team of Laura Stroud and Lisa Fernandez-Wilson the better part of a week to sell it.
The current owner had paid $1,550,000 in 2015.
Described by the team from French King Fine Properties as having “walnut-wrapped walls, large custom closet and a custom floating bar.” The listing discloses the “Neorest toilet does not convey.”
Toto Neorest 750H toilet with Actilight technology.
-- Photograph Courtesy Of TotoWhen selling a condo for $1,166 per square foot, such a disclosure makes one wonder what qualities a Neorest toilet would possess that would enhance the owner to take it with him.
A quick check of the website reveals a “Toto Neorest Elongated One Piece Toilet” normally sells for $6,950 but is currently on sale for a mere $4,865. And no, we are not in Kansas anymore.
This toilet “is engineered to provide its user with unrivaled comfort,” the website states, and has a trademarked system that keeps the bowl clean and hygienic “while the WonderWave spray and warm air dryer keeps you feeling refreshed.”
Their claim is that this toilet “will transfer your bathroom into an oasis.”
It goes without saying that the neither the C&S Builders homes nor the Fox Ridge homes include the Toto Neorest Elongated One Piece Toilet. That feature would require quite a bit of sweat equity.
Richard Courtney is a licensed real estate broker with Fridrich and Clark Realty and can be reached at [email protected].