House Move: Sensical?

Driving down a street in my neighborhood yesterday, we happened upon a HUGE operation where two houses, or maybe two halves of one house, were being moved onto a lot. Now, this is right across the street from some pretty upscale houses, and on a set of blocks that are definitely going to be appreciating in value as time goes on.
The house/s that they were moving in where...to put it mildy...crap. 2x4 exterior walls, uninsulated, old wiring, 17 layers of roof, etc. They had to rip the chimney out in order to move them, as well as take off what looked like could have been a porch or something. Basically, it looked like a barn.
So my question is, under what situation does this make financial sense, to bring in what, to my moderately trained eye looked like a teardown, and put it on a really nice lot? My wife and I figure that it *was* a teardown, and instead, somebody said "I'll take it!" and, for the price of moving it, plunked it down on their lot and plan on renting it. I would assume that because it's an 'existing' house, they can circumvent some code requirements re: upgrading electrical service, insulating, etc.
H
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I've seen some amazing renovations done to barns. Maybe they've got big plans for it, and it'll turn out gorgeous.

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I spent 3 months working on an "moved home". The move in AZ cost $1000 a mile, which included the removal and step up of the home after the move. (1979 dollars) The moving contractor took care of the roof. The home owner had a floor poured for the structure he did not make the floor foot print as I had suggested a few inches larger so parts of the exterior walls hung over the foundation in the beginning. The foundation was made larger and the walls eventually worked out well. The CCTV was unusable do to the number of cuts the runs had. I had to rip out the drywall in places to fix that. The electrical stuff in the attic was a joy to find. They just sawed the house in half. All of the plumbing was underground. A/C duct was repaired and installed. with airhandlers in outside closets on either end of the home. All in all the construction of this home was faster than a build from scratch but not by much. Maybe a couple of weeks. I am sure the HO saved some money doing it this way and I am also sure that he got the shell for a song.
This must be handled with a case by case basis.
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Greetings,
This may sound like a strange reply --- but why don't you introduce yourself to your neighbor? Tell him you are interested. I am sure he would love to tell you all about it.
William

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You mean....talk to the neighbors??? Are you crazy? :)

etc.
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1. Not really my neighbor, so if they were there, I would have no idea who they were.
2. I'm willing to bet ($1 max) that the owner was nowhere to be found. To put a house like that (crap) on a lot like that (golden), I'm thinking that it's somebody who could give a rip about quality and/or neighbors and/or street appeal and/or etc, and is looking to put a rentable edifice on his property asap. BTW, this lot is 7 block S of the second largest university in the state...so...landlord's wet dream.
I like the $1000/mile figure mentioned earlier. We were able to trace the path of where it came from right up to Hwy99, since all other streets were small enough to require no parking signs and other measures to make sure a house would fit through. The thing sure looked like it came from the country, but at that $/distance figure, I'd bet it was more local than we thought.
William Deans wrote:

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You might like the $1000 per mile figure, but I think you'll find in reality it costs an order of magnitude more than that to move even a small house. I'd like to see anyone move a house 2 miles for $2K. That wouldn't even cover the work of jacking up the house to prepare for the move.
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A company I used to work for had an old junker house on a lot that wa
in the way of expansion. To keep the historical preservationists and neighborhood association happy they gave it away. This lady paid $30 to move it onto a $80k lot, then dumped about $50k more into fixing i up, then sold it for about $300k. Not a bad return
-- makesawdust
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The guy 3 houses up from me moved a 780 sq/ft house 15 feet back and then built a 2000+ foot house over top of it. I asked him several times why this wasn't a teardown and never did get an answer that made any sense. I suppose there may be some subtle permit or tax excuse but I don't have a clue what it might be. There is no historical link and his taxes will be based on what he ends up with, at market value. Since the lot was already developed, permits are not an issue. The only thing he said that might make a bit of sense was he could live there. I think you could rent for the cost of moving the house and the added costs of building around the existing structure. They have the new shell dried in and they are tearing out the old house, hauling it out in wheelbarrows I suppose. My wife is a builder and she just shakes her head when she drives by.
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Greetings,
If they are going to turn right around and sell the new home this strategy might avoid paying some capital gains tax (since they will have lived in the home two out of the last five years).
Hope this helps, William

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Interesting concept but the strap number refers to the lot not the building. There will not be a real estate transfer filed to trigger the IRS "gain" if they simply tear down the house and build a new one.
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I knew a guy that bought a home the interstate was gonna flatten,, he paid less than $500 for the house including legal papers.
Moved it less than a mile for hundreds of dollars and set in on a lot next to his fairly nice home,,, wasn't long before he lived in it, the wife and 3 kids lived in the big house. Beat the cost of a divorce and eventually that house looked nice & fit the neighborhood except for the fact it was raised with a crawl space. Nice little home.

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