Back around 1990, I had a chance meeting with a famous financial adviser.
“If you had one single piece of financial advice that would apply to almost everybody,” I asked him, “What would it be?”
“Don’t move,” he answered.
He was right. Since getting that advice, my then-spouse and I sold our house in Rockrimmon and moved to a 9,000-square-foot wreck on Cascade Avenue near Downtown. It cost a fortune to restore, a fortune to heat and a fortune to maintain, so we sold it, moved to an 1899 Westside home in 2000 and got divorced. I stayed in the house and remarried. This is the last stop on the trolley line — Karen and I are here until death or disability forces us to leave.
Since 2000 our home has more than doubled in value, judging by recent Westside sales. The famous financial adviser (whose name escapes me!) was right, at least for Colorado Springs residential real estate. Our net worth has soared and we’ve sheltered happily in our amiable neighborhood.
Both Karen and I have been restless homeowners, skipping from house to house and never accumulating much equity. We’ve tapped some of our present equity with a reverse mortgage, taking out a few bucks to paint and otherwise fix up the old dump. Our present financial goals are modest. We want to keep monthly expenses low, delay the inevitable as long as possible and live to see the bars reopen.
A few months after I was born in 1940, my parents bought a house on North Tejon Street for $2,100. After my father died my mother sold it in 1960 for $17,500. The house on Tejon has had several owners since then, and just changed hands in August. The price: $971,000. That’s 55 times the 1960 price, and 462 times the 1940 price.
So what will it be worth in 80 years? That’s unknowable but it’s fun to guess. If you assume the 1940-2020 rate of increase without adjusting for inflation, $448 million. If the 1960-2020 rate, a mere $54 million.
Yeah, that seems absurd. In these strange times, our cheerful dreams of future prosperity have been replaced by dark prophecies of doom. Climate change may render much of the world uninhabitable, vast migrations of displaced persons could overwhelm and destabilize wealthy nations and civil order may collapse. So maybe we should forget about real estate in Colorado Springs, sell everything and move to New Zealand? Sounds good, but New Zealand won’t let us in. Our best option is to stay right here, welcome the young and ambitious as well as the old and retired and watch our homes appreciate.
Yet our real estate bubble could burst, as it did during the 1930s. The Great Depression stripped value from Colorado Springs real estate, so much so that the Tejon Street house that sold for $2,100 in 1940 sold for more than that in the early 1900s.
During the late 1930s, my older sister and her friends used to play in a deserted North End mansion on Cascade Avenue, long abandoned by its once-wealthy owners. Could climate change, national political dysfunction or overdependence on the military economic sector crater our economy for decades?
That’s for you to worry about, not me — I’ve done my share. Sitting on the sunlit front porch with our three dogs earlier this week, I asked my canny friend Jimmy for some financial words of wisdom.
“When you die, do you want to be a rich guy in the cemetery?” he asked. “You can spend some of that equity.” Comforting words, but he’s careful and conservative — doesn’t owe a cent on his comfortable place in Cheyenne Canyon. He’d dropped by our house to borrow a pole saw, which we tucked into the bed of his 1978 El Camino.
“Bought it new, and it’s been great,” he said. “Never failed to start, never let me down, and it’s got 189,500 miles.”
Jimmy’s fine unless Cheyenne Creek floods and inundates the canyon.
“I don’t worry about that,” he said. “The Broadmoor diverts most of its flow. It’s supposed to be really warm tomorrow — come by and bring the dogs — they can play in the creek.”
So work hard, be careful, pay off the mortgage, keep your work car for 42 years and then, if the crick don’t flood… live for the day!