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Value of house in charity raffle is questioned

February 24, 2008|By ARNOLD S. PLATOU

BIG POOL - It's a mystery.

No one knows why the house that's the grand prize in a raffle to benefit a Washington County charity didn't sell in all the time it was on the market, begging for an offer.

But for the moment, San Mar Children's Home is on the hook to pay at least $40,100 more than anyone else would.

And that has San Mar's executive director wondering why.

"How that was set? Why it was marketed at $349 (thousand)? Why did it come in at $390 (thousand)? I don't question any malfeasance there. I just don't understand," Bruce Anderson said last week.

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"It's a lot of extra tickets we've got to sell" to pay the higher price, he said.

The question could be moot in a few weeks because Maryland is requiring that another appraisal be done. But for now, San Mar must sell at least enough raffle tickets to cover the cost of other prizes as well as the $390,000 value set by the current appraisal for the house.

The house, at 13607 Indian Springs Road near Big Pool, is next to a trout stream, near Whitetail Resort and surrounded by 1,500 acres owned by the Western Maryland Hunt Club.

With four bedrooms, three baths and a great room with a stone fireplace, the house and its 3.2-acre property became the raffle's grand prize after it had been on the market for 16 months.

Blaming the nation's ongoing housing crisis, the owners and their Realtor teamed up with San Mar, which cares for 41 girls near Boonsboro, after reading about a similar raffle out West.

The charity is to reap any money raised after it pays for the house and other prizes.

The raffle, which Maryland has approved, has drawn coverage by national news media, and orders for tickets from around the world since December, when The Herald-Mail published a story about it.

San Mar has agreed to buy the house for its appraised value of $390,000 if it sells at least 5,000 raffle tickets for $100 each. If it doesn't sell that many before March 13, when the drawing is to be held, or by May 15, its fallback date, the raffle would be canceled and $99 of every ticket refunded.

As of this past Thursday, San Mar had sold 3,951 tickets, according to the Web site that the charity set up at www.san marraffle.com to help handle the orders.

House's history

The question of value is rooted in the house's recent market history.

Built in 1929, the house was sold as a fixer-upper in 2005 for $185,000 to a company that remodeled it and sold it to Karen Crawford and her husband, Dennis Kelly, for $375,000 in April 2006.

Wanting to retire, the couple realized too late that the two-story house wasn't for them.

So the very next month, they put it back on the market for $384,900, according to Metropolitan Regional Information Systems Inc., which tracks real estate deals.

By then, the market had begun to sour, and there began nearly a year and a half of price drops as no one made any offers to buy the property.

Real estate agent Charles Angle of MacIntosh Realty, who had the listing, cited confidentiality in declining to talk about the pricing. But he agreed to talk about his sales efforts when asked how another Realtor and an appraiser could have set much higher prices.

Angle said he advertised the property in newspapers throughout the region, in a homes magazine, on the Ad Channel and on a national Internet site.

"It was just a property that we had shown or other Realtors had shown, and people did not have an interest in buying it," he said. "These were either my showings or other agents calling and making an appointment to take their client through.

"... We had some interest, but nobody would write any offers on it."

He said part of the difficulty might have been the remote location.

Crawford has said six couples were interested in the house, "but when they went for financing, we never heard any more.

"Once that whole housing thing went down, a lot of young couples were blocked out," she said. "We had showings every weekend and we couldn't get a buyer. It's part of what's happening today."

As the months passed, the couple dropped the price to $374,900, according to MRIS. Then, it fell to $369,900. And then to $359,900 - with the additional note, "OFFERS WELCOME!!"

Finally, with still no offers coming in, the price was cut again to $349,900, with "OFFERS WELCOME!!"

That's where it was on Sept. 2, 2007, when Angle's contract expired.

Five days later, MRIS records show, Realtor Cynthia Moler of Coldwell Banker, listed the property at $425,000.

And just five days after that - on Sept. 12, 2007 - appraiser James M. Wise, of Wise Appraisal Services in Hagerstown, issued an appraisal report, valuing the property at $390,000.

How could that be?

How could a property that attracted no offers for nearly a year and a half even after its price sunk to $349,900, suddenly - after just 10 days - be worth $390,000, the price that San Mar is under contract to pay?

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