Encore: A legacy of neglect

This is another encore entry. It was originally publish August 6, 2007, in the wake of the bridge collapse in Minnesota.

2008 update: Neglect of property costs five times as much to repair than it would to maintain, is this true of our economy? How do we maintain an economy -- with more regulation? or less?

Now: the encore.

Neglect. That’s a nasty word. Our national lesson this week is that when we neglect our infrastructure, disaster follows. I see neglected homes every week. If homeowners neglect their homes, they still get to sell it to some ambitious buyer.

So buyers, thinking about a fixer-upper? Be ready to experience some variation on the “rule of fives.”

Part of the reason early investments in maintenance are cost effective is the so-called "rule of fives." If maintenance is not performed, the ensuing repairs are likely to be about five times the cost of maintenance. If repairs are not completed, rehabilitation will be five times more expensive than repairs.

Rehabilitation costs more than maintenance for the structural/mechanical workings of a home. Water and fire damage fall into that category. The exception with homes is that taste and style dictate in the living space. Wall-paper from the 20s is no more expensive to remove than ugly brand-new wallpaper. A kitchen that has not been updated since the 20s may actually be cheaper to demolish than a horrible one from the 70s.

Before you buy, meditate on my serenity prayer of home buying (apologies to friends of Bill W.):
Grant me the serenity to accept the things I cannot change, the courage to change the things I can, and the wisdom to know the cost and the difference.

Happy New Year to my Jewish readers and Ramadan Mubarak to my Muslim readers!