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Leaking acid; I signed what?

January 4th, 2008 by Matt · 76 Comments · Trace Lofts

I was wondering why my neighbor stopped parking next to me about three weeks ago. I figured it had to do with my switch from a compact four door car to a hulking SUV. Turns out it really has to do with leaking acid:

Dear Matt,

We have recently been made informed of a potential danger in the area where you are parking which we want to make you aware of. Some water has migrated through the concrete slab on the west side of the Trace Lofts garage and has caused damage to a car parked below.

As you know there are dangers inherent in driving through and parking in a construction zone which is why everyone signed an early access agreement prior to closing. These dangers aren’t limited to dust and sharp objects – they specifically include water migrating through concrete and causing permanent damage to cars after the water becomes acidic. This has happened to at least one car so far.

The situation may improve when the courtyard is waterproofed in March, but this is no guarantee until after construction is fully completed.

We felt it was important to communicate this to you so that you are aware and can make alternate parking arrangements outside the garage if you so choose. Note that there will be no recourse for anyone sustaining damage to their vehicle in the garage, per the release that everyone signed.

Thank you.

Trace Lofts

For those not familiar with the Trace complex, there are two buildings. Trace Lofts is the old warehouse that sits on the south end of the lot and is mostly sold and occupied. Trace North is the new building on the north end of the lot that is still under construction. Parking is shared in a parking garage that is under both buildings. My stall is in a spot that is under the new building. And yes, I did sign an early access agreement [pdf].

Now if I were Trace and sitting on a large number of unsold units in a down market and had an issue with an early adopter who took a chance and bought early I would first inform people of the danger as soon as I found out about it and not sit on the bad news for several weeks hoping Matt didn’t get any acid on him. Sure, Trace, might not be liable because of something the residents signed a long time ago, but it’s the right thing to do when someone is facing permanent damage to their vehicle. Secondly, there are still a number of parking stalls available as there are unsold Trace Lofts units. Some of these stalls are presumably under Trace Lofts which does not have the water migrating acid leaking problem. Why not offer affected residents the opportunity to temporarily park in a safer stall instead of suggesting we should go rent a $100/month parking spot elsewhere?

We’re your best sales team, keeping us spreading the good word of Trace should be a top priority for the Trace developer and marketing team.

When faced with a difficult situation I don’t think its too much to ask that developers ‘do the right thing’ and ask how they would want to be treated if they were on the receiving end of a similar situation.

In other 12th and Madison news: I went to Boom Noodle the new restaurant underneath Agnes Lofts last night (it opened on the 2nd.) The noodles were good but even though I also had desert I was still hungry two hours later; not promising. But once the place gets their liquor license I suspect it will be a nice relatively upscale hang out for Capitol Hill yuppies.

…

While waiting for the always late #12 bus yesterday and today I noticed a land use sign. Looks like they are tearing down 1210 11th Ave:

4060158 e20309592e m Leaking acid; I signed what?

4060157 e7b8e868cd m Leaking acid; I signed what?

Here’s the land use notice for 48 housing units and retail:

4060156 73581df4ba m Leaking acid; I signed what?

….

They’re on the verge of completing the burying of the power lines directly across from me. I can’t wait to stop being woken up at 7:30. Now if only my neighbor would stop sleeping through their alarm…

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  • Peckham

    “My mortgage interest (~800) + taxes (~200) + HODs (~300) equals what my downstairs neighbor pays to rent her unit (1,300).”

    I notice that you have conveniently left off mortgage principal in your calcualtion. When do they teach children to count, or don’t they do that anymore?

  • Peckham

    “My mortgage interest (~800) + taxes (~200) + HODs (~300) equals what my downstairs neighbor pays to rent her unit (1,300).”

    I notice that you have conveniently left off mortgage principal in your calcualtion. When do they teach children to count, or don’t they do that anymore?

  • nitsuj

    FWIW I actually enjoy (to a point) what Peckham and others add. Living in the Bay area I’ve seen too much of the “BR shopping, BMW driving, condo owning overleveraged metro with a smugness that comes from ‘owning’”, who think they are financial geniuses because they bought a place and never thought twice to renting an equivalent place for a fraction of the cost while investing the rest of the money (granted, most people just seem to up their consumption rather than invest). I think it’s good to get that other viewpoint in here as it may cause others to think for a minute, but I do understand how it (negatively at times) changes the dynamic you probably expected when starting your blog.

    Re: his last comment, interest only loan, thus nothing going towards principal?

  • nitsuj

    FWIW I actually enjoy (to a point) what Peckham and others add. Living in the Bay area I’ve seen too much of the “BR shopping, BMW driving, condo owning overleveraged metro with a smugness that comes from ‘owning’”, who think they are financial geniuses because they bought a place and never thought twice to renting an equivalent place for a fraction of the cost while investing the rest of the money (granted, most people just seem to up their consumption rather than invest). I think it’s good to get that other viewpoint in here as it may cause others to think for a minute, but I do understand how it (negatively at times) changes the dynamic you probably expected when starting your blog.

    Re: his last comment, interest only loan, thus nothing going towards principal?

  • nitsuj

    oops, my “” and “” didn’t come thru before the BR shopping comment. guess the blog strips out potential html commenting??

  • nitsuj

    oops, my “” and “” didn’t come thru before the BR shopping comment. guess the blog strips out potential html commenting??

  • nitsuj

    ACK!!! stripped it out again. stereotype in brackets on both ends of that comment, good lord i fail at the innernets

  • nitsuj

    ACK!!! stripped it out again. stereotype in brackets on both ends of that comment, good lord i fail at the innernets

  • Eric K

    So are you saving that rents don’t increase with inflation? I could have used the unit below mine, whose rent increased 30% since I bought my unit in 2003. If you don’t believe that inflation exists, then there’s no point hedging it by owning a home with a fixed interest rate.

    It sounds like you believe people should always rent. Is that really true?

    I left off principal in the inital sum because because
    1) by reducing the balance of the loan, it is a form of savings that has no equivalent in renting
    2) I didn’t include the tax deduction yet. Once the tax deduction is included, the total number of pretax dollars that I must allocate to principle, interest, taxes, and condo dues is the same as my downstairs neighboor who rents, yet I get the savings from paying down the principal and she doesn’t.

  • Eric K

    So are you saving that rents don’t increase with inflation? I could have used the unit below mine, whose rent increased 30% since I bought my unit in 2003. If you don’t believe that inflation exists, then there’s no point hedging it by owning a home with a fixed interest rate.

    It sounds like you believe people should always rent. Is that really true?

    I left off principal in the inital sum because because
    1) by reducing the balance of the loan, it is a form of savings that has no equivalent in renting
    2) I didn’t include the tax deduction yet. Once the tax deduction is included, the total number of pretax dollars that I must allocate to principle, interest, taxes, and condo dues is the same as my downstairs neighboor who rents, yet I get the savings from paying down the principal and she doesn’t.

  • Peckhammer

    “It sounds like you believe people should always rent. Is that really true?

    When the cost of buying, in financial terms, is in step with well-established fundamentals, I believe buying is a good choice. There will always be a cost for housing, renting or buying.

    There are other reasons for buying. Psychological satisfaction is one of them, for example. I accept that argument so long as it isn’t justified with talk of “investment strategies” and other such hoo ha.

  • Peckhammer

    “It sounds like you believe people should always rent. Is that really true?

    When the cost of buying, in financial terms, is in step with well-established fundamentals, I believe buying is a good choice. There will always be a cost for housing, renting or buying.

    There are other reasons for buying. Psychological satisfaction is one of them, for example. I accept that argument so long as it isn’t justified with talk of “investment strategies” and other such hoo ha.

  • Mark W

    Eric writes
    … That still leaves a gain of 103k …
    What is his % return on that period? Most people would say 41%, since 103/250 = 41%. However, he didnt buy the place with cash he only put 20% down, or $50k. So his actual return is 103/50 = 206%. ….

    Although I agree that the return shouldn’t be based on purchase price, basing it only on the down payment isn’t right, either. After all, he also had approx 44 months of payments, taxes and HOA dues (with payment interest and taxes partially offset by tax deductions). And there’s also lost opportunity cost from not investing the down payment and subsequent payments money in something else instead. The 206% return ignores all of that.

    (I effectively lost money on a house I sold in Ohio in 2002 after 7+ years of ownership, and “is Seattle housing experiencing a price bubble” headlines appeared with some regularity after I arrived here in 2002, so I’m gunshy rather than anti-condo, a newbie who figures a condo is in my future at some point.)

  • Mark W

    Eric writes
    … That still leaves a gain of 103k …
    What is his % return on that period? Most people would say 41%, since 103/250 = 41%. However, he didn’t buy the place with cash — he only put 20% down, or $50k. So his actual return is 103/50 = 206%. ….

    Although I agree that the return shouldn’t be based on purchase price, basing it only on the down payment isn’t right, either. After all, he also had approx 44 months of payments, taxes and HOA dues (with payment interest and taxes partially offset by tax deductions). And there’s also lost opportunity cost from not investing the down payment and subsequent payments money in something else instead. The 206% return ignores all of that.

    (I effectively lost money on a house I sold in Ohio in 2002 after 7+ years of ownership, and “is Seattle housing experiencing a price bubble” headlines appeared with some regularity after I arrived here in 2002, so I’m gunshy rather than anti-condo, a newbie who figures a condo is in my future at some point.)

  • Eric K

    In my friend’s case, he bought in a building that was completed in 2002-3, and the builder paid the homeowners dues through mid 2004. Interest rates were very low in the winter of 2002-2003, which was the depths of the last bear market, and he had a 3 year fixed rate mortgage at some ridiculously low interest rate. You’re right, though, that the calculation is more complicated. In his case, the cost of renting a new construction apartment was comparable to the monthly cost of his mortgage, property taxes, and (when he had to pay it) condo dues.

    I don’t believe that “real estate always goes up” or that it is a surefire investment. There are times when it is better to hold hard assets like real estate, and their are times when it is better to hold cash and rent. It’s also true that larger condos (above 1,000 sq) have historically underperformed small condos, since the pool of buyers is smaller while the supply of large downtown condos is oddly larger. (This is even more true of the new buildings — 1521 2nd ave is all 1650sq and up).

    I just think it’s misleading to say that condos are always a terrible investment. I wouldn’t buy for a year or two, but at that time I think condos will make a great investment.

  • Eric K

    In my friend’s case, he bought in a building that was completed in 2002-3, and the builder paid the homeowners dues through mid 2004. Interest rates were very low in the winter of 2002-2003, which was the depths of the last bear market, and he had a 3 year fixed rate mortgage at some ridiculously low interest rate. You’re right, though, that the calculation is more complicated. In his case, the cost of renting a new construction apartment was comparable to the monthly cost of his mortgage, property taxes, and (when he had to pay it) condo dues.

    I don’t believe that “real estate always goes up” or that it is a surefire investment. There are times when it is better to hold hard assets like real estate, and their are times when it is better to hold cash and rent. It’s also true that larger condos (above 1,000 sq) have historically underperformed small condos, since the pool of buyers is smaller while the supply of large downtown condos is oddly larger. (This is even more true of the new buildings — 1521 2nd ave is all 1650sq and up).

    I just think it’s misleading to say that condos are always a terrible investment. I wouldn’t buy for a year or two, but at that time I think condos will make a great investment.

  • Peckham

    ” just think its misleading to say that condos are always a terrible investment.”

    And I think it is wrong to call it an investment at all, unless it is an income property. No accountant on this planet will call your primary residence an investment. It is not. It is an asset that has a historical inflation adjusted appreciation on par with my checking account.

    No offense Eric, but you are not absorbing this very well, and you do not appear to be able to calculate the costs of ownership either. This is not unique to you, however, and I don’t mean to single you out. You just happen to be the guy talking when I was within earshot. ;)

    I love hearing about the great tax “savings” that people get with that interest deduction. LOL! I want in on that card game: for every dollar you give me, I’ll give you 27-cents back… and you’ll think you are winning.

  • Peckham

    ” just think it’s misleading to say that condos are always a terrible investment.”

    And I think it is wrong to call it an investment at all, unless it is an income property. No accountant on this planet will call your primary residence an investment. It is not. It is an asset that has a historical inflation adjusted appreciation on par with my checking account.

    No offense Eric, but you are not absorbing this very well, and you do not appear to be able to calculate the costs of ownership either. This is not unique to you, however, and I don’t mean to single you out. You just happen to be the guy talking when I was within earshot. ;)

    I love hearing about the great tax “savings” that people get with that interest deduction. LOL! I want in on that card game: for every dollar you give me, I’ll give you 27-cents back… and you’ll think you are winning.

  • Eric K

    You think an investment has to pay income _while_ you hold it, thus buying Microsoft in 1986 would not have been buying an investment.

    Buying land would also not be an investment in your eyes, since it actually consumes money for property taxes until it is sold or developed.

    I don’t care what you call it. I put 20% of the purchase price down that I had previously invested in the stock market, so I’m going to call that 20% an investment.

  • Eric K

    You think an investment has to pay income _while_ you hold it, thus buying Microsoft in 1986 would not have been buying an investment.

    Buying land would also not be an investment in your eyes, since it actually consumes money for property taxes until it is sold or developed.

    I don’t care what you call it. I put 20% of the purchase price down that I had previously invested in the stock market, so I’m going to call that 20% an investment.

  • Peckhammer

    “You think an investment has to pay income _while_ you hold it, thus buying Microsoft in 1986 would not have been buying an investment.”

    That is not what I think. An asset acquired for the purpose of producing income and/or capital gains is an investment.

    “Buying land would also not be an investment in your eyes, since it actually consumes money for property taxes until it is sold or developed.”

    Land can be an asset acquired for the purpose of producing income and/or capital gains.

    “I put 20% of the purchase price down that I had previously invested in the stock market, so Im going to call that 20% an investment.

    You can call it your “little friend” for all I care; you are still wrong.

  • Peckhammer

    “You think an investment has to pay income _while_ you hold it, thus buying Microsoft in 1986 would not have been buying an investment.”

    That is not what I think. An asset acquired for the purpose of producing income and/or capital gains is an investment.

    “Buying land would also not be an investment in your eyes, since it actually consumes money for property taxes until it is sold or developed.”

    Land can be an asset acquired for the purpose of producing income and/or capital gains.

    “I put 20% of the purchase price down that I had previously invested in the stock market, so I’m going to call that 20% an investment.

    You can call it your “little friend” for all I care; you are still wrong.

  • http://twitter.com/mattgoyer mattgoyer

    Can we stop debating the definition of the word investment? Thanks.

  • http://blog.mattgoyer.com Matt

    Can we stop debating the definition of the word investment? Thanks.

  • Barboursm

    ok, so I don’t want to get in the investment debate but really want to comment on the parking…it sucks! I went in to ask about making a change and what the policy was around it, I was told that they were meeting about it and should have a solution in a week, I felt hope. I stopped by a week later and talked with Jim, he didn’t know anything about it (not knocking Jim, because he is great) but I was pretty upset I was told they were going to come up with a solution and come to find out it was never even discussed. My spot is so compact that I can’t open my door all the way, unless I want to hit my neighbors cars. I can’t get my groceries out let alone my laptop bag. If I grow a size bigger I will have to find a parking spot outside of the building as there seems to be no flexibility in change. SO frustrating…just needed to vent!

  • Barboursm

    ok, so I don’t want to get in the investment debate but really want to comment on the parking…it sucks! I went in to ask about making a change and what the policy was around it, I was told that they were meeting about it and should have a solution in a week, I felt hope. I stopped by a week later and talked with Jim, he didn’t know anything about it (not knocking Jim, because he is great) but I was pretty upset I was told they were going to come up with a solution and come to find out it was never even discussed. My spot is so compact that I can’t open my door all the way, unless I want to hit my neighbors cars. I can’t get my groceries out let alone my laptop bag. If I grow a size bigger I will have to find a parking spot outside of the building as there seems to be no flexibility in change. SO frustrating…just needed to vent!

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