The historical preservation movement deploys a veiled theivery to create compulsory museums

by Cathleen Collins

Realtor, Staging Consultant

Author website

Richard Riccelli asks

Historic districts: Good for buyers? Sellers? Realtors? This guy??

I say: depends on what the buyer wants; maybe but maybe not; neutral; that guy was robbed!

Buyers of any property, real or personal, get to celebrate their own personal tastes by buying what they like and can afford. So are historic districts good for buyers? It depends on whether that’s important to the buyer. Some of my buying clients like HOAs, others loathe them. Some like brand-new builds, others want rambling ranches circa 1970. That’s their business. My business is to help them find whatever they want.

I happen to prefer older homes to newer ones. But I don’t believe older homes are physically better than newer ones. Better architecture and craftsmanship come at a price… then and now. A house built for the middle class buyer of 1935 is probably of similar quality to a house built for today’s middle class buyer. Similar quality but less appropriate for today’s lifestyle. Yet the historic middle class home, particularly in an historic district, is more expensive for today’s buyer than the middle class home in the suburbs. Why? Because the historic home is more rare, and in a free market that makes it more precious.

Right now there is a 3 bedroom, 2 bath house listed on 124 W Coronado Rd in Phoenix’s Willo district. It’s a plain 2,277 square foot brick ranch with stained concrete floors and a single car garage that’s been converted to a storage facility. Because of the age, I wouldn’t expect much in the way of closets or kitchen storage. When the house was new, it would have been smaller — the second bath and master bedroom walk-in closet described in the listing would have been added later — and built for the working class. The asking price on this listing is $675,000.

In Peoria, that $675,000 will buy you a 3 bedroom, 3.25 bath 3,045 square foot house with casita (separate guest quarters) and 3-car garage on a golf course lot. This house has a highly upgraded gourmet kitchen — stainless, granite, maple — with a wine room, among its luxury appointments. Peoria is a beautiful, upscale west-side suburb of Phoenix, and this property is in a gated adults-only golf community, Trilogy at Vistancia. The builder of this home had a more affluent buyer in mind than the Willo builder imagined in 1935.

Both homes will appeal to people who care about living in a close knit, friendly neighborhood, but each of these homes will have its own target market. In both cases, rules are in place to keep the neighborhoods attractive. Trilogy at Vistancia has a home owner’s association, and houses in the Willo have to adhere to the rules of historic preservation.

When a hopeful buyer offers to buy a house, standard language in Arizona’s Purchase Contract gives the buyer ten days to discover whether anything about the house is unacceptable to the buyer. During this period the buyer should look into the rules, covenants, policies of the HOA or historical preservation charter. If the rules are onerous to the prospective buyer, he can cancel the contract and be entitled to full refund of his earnest deposit — no harm, no foul. The buyer should know what all of the rules for owning the house are before he buys it.

As long as this is so, as long as the house is bought by someone who is aware of the rules, and probably likes the rules, then when the buyer goes to sell the house, he’ll be selling to people of like mind. If being on an historic register is what tipped the balance on a buying decision when going in, then the seller can hope to appeal to the same sensibility on the way out. That presumes that the fashionable passion for older homes will persist, but it doesn’t seem likely to change in the near-term.

But the case of Bob Higgins from Standish, Maine, which Richard pointed to, is a case where Bob’s family owned property, free of restrictions on their ownership. But busy-body neighbors used the long arm of the law to enforce their ideas of what to do with their neighbor’s property, even though the legal owner had other ideas for that property, and even though the community’s idea financially hurt their neighbor.

Communities all over the country shuddered in the summer of 2005, when the Supreme Court ruled that “local governments may force property owners to sell out and make way for private economic development when officials decide it would benefit the public.” That was wrong because the government took people’s private property and gave it to developers, who would profit from the theft. Compare that to neighborhood busy bodies who prevent a legal owner from making a profit off of his property if by doing so he upset the community’s sensibilities. If the neighbors didn’t want Mr. Higgins to sell his property to developers, they should have out-bid the developers, and then they could do with their own property as they wish. But wait… that means they, the busy body neighbors, would have to lose money, and that they couldn’t afford to do. Better to break Mr. Higgins!

Greg and I live in North Central Phoenix. A couple of years ago property on Central Avenue became subject to land use restrictions, including prohibition on cutting down olive trees that were growing on private property. An old bridle path that extends several miles along the east side of Central, which is today used by joggers and dog-walkers, was designated historic. Now if one of the lovely mansions facing west on Central needs a new driveway, that driveway must respect the dirt ex-bridal path. This means the driveway can be concrete or asphalt or brick or marble, except where it crosses the ex-bridal path. There it must submit itself to a four-foot dirt interruption. Greg wrote a letter to the editor of the Phoenix North Central News when that issue was being discussed. He, of course, took the position contrary to the historical preservationists. The letter doesn’t survive electronically, but I’m copying it in part here:

The word “community” always rankles me. It either means everyone (which is false) or a tiny minority of activists (which is true). Much if not most of the land in North Central is investor-owned (all of it is if homeowners consider themselves as investors, as they should). Investors seek the highest rate of return on their capital, and it seems specious to argue that they don’t want that in this special case. A tiny minority of activists might wish to take control of land they do not own, but this is clearly contrary to the long-term interests of the actual owners. If the laws sought are passed, their temporary effect will be to surround Central with higher-density development. The developers are already well-schooled in the amazing value of vertical development in the Central Corridor. (What’s slowing this, frankly, is that the ding-dong developers don’t know how to build in-city housing; project-by-project they’re catching on.) Some of the present residents may not want it, but all of the new residents are paying incredible premiums to get it. That’s why the long-term effect will be nil, because market forces, corruption or not, will prevail in the end. A possible short-term consequence of the passage of these laws will be a rash of hurried sales to take advantage of grandfathered rights — hastening rather than hindering the ultimate transformation of Central Avenue.

Early this year, when Greg and I were listing one of our all-time favorite Phoenix houses for one of our all-time favorite friends, I took a friend to see the house. She had moved to Phoenix from Peru only about a year earlier, and had never seen any of Phoenix’s historical neighborhoods. She really had problems with the idea that this house had only one bathroom. She explained that in Peru even the smallest and cheapest home had at least two bathrooms. Her English is broken and I speak no Spanish at all, so we struggled as I tried to explain that I didn’t believe there are no Peruvian homes with just one bathroom. Before indoor plumbing, I explained, houses would have been built with no bathrooms. And some of those, the ones that belonged to the more prosperous, would have been converted to single bath homes at the advent of indoor plumbing. However, my friend kept insisting that every house has at least two bathrooms. So I finally concluded that any house built in Peru before say 1900, 1920, must have been destroyed before my friend was born. Finally she got it.

“Oh no,” she said. “My grandparents live in an old house from the 1920s.”

“And how many bathrooms does that house have?” I asked.

“One.”

“One?”

“Yessss… but that’s not the same as this house.”

“Why not?”

“Because my grandparents live in a museum.”

So again, we’re having a communication problem. But finally she gets me to understand that in Peru, when a house gets an historic designation, it is confiscated by the government’s preservation arm. The owners are given a life estate in the property, but they don’t have the rights to make any changes to the structure, nor to sell or bequeath it.

And as contrary as this seems to the American idea of private property, it’s no more so than the confiscation by local, community preservation leagues.

Technorati Tags: arizona, arizona real estate, phoenix, phoenix real estate, real estate