Real Estate Investing

A colleague returned to work today after being absent for a little more than a week.  Her beloved mother-in-law had passed away from a devastating stroke and C. has spent the last week at her husband’s side.  At lunch, she told me some of the things she learned about cremation. 

Her father-in-law had passed away many years ago and his ashes were interred at a local cemetery.  Nellie had also asked to be cremated and this was where they learned their first lesson:  Ashes now have to be returned in a metal box or an urn which costs at a minimum $500.   Before, her father-in-law’s remains were sealed in a plastic bag and placed in a box.

The second lesson:  If you want to bury ashes in the same grave site as a loved one who has also been cremated, you have to buy the plot all over again at current market value.  It’s called second right of interment and according to this answer, it’s a for-profit cemetery that has very little state oversight.

That cemeteries have so little oversight rather intrigues me, but I suppose the focus is on morticians rather than the actual burial grounds.  As long as state requirements are met as far as the final resting place of a person, then it would seem a natural assumption that cemeteries are also observing state regulations.

This reminds me a bit of what I heard about Hawaii real estate.  The cost of buying beach property in Hawaii is so expensive that the state now allows for Fractional Ownership of homes. 

Growing numbers of local real-estate agents have recently begun marketing “fractional ownership” of homes where up to six buyers purchase interests, allowing each one to use the property 60 days a year.

Homes for sale as fractional, or shared, use have emerged partly as a strategy to put Hawai’i vacation homes back within reach of more buyers who have been priced out of the market by the doubling of home values over the past five years.

Homebuyers in Hawaii may also opt for a leasehold purchase - you own the home for up to 55 years but not the land.

In Hawaii, you still find this form of ownership very often for condominiums and also for some beach properties on the North Shore of Oahu. The ground leases are mostly negotiated for a term of 55 years and depending on what is left of it when you buy the property, you will have to renegotiate with the property owners, who are not obliged to extend or renegotiate leases.

It’s kind of scary the parallels we can draw between owning land in Hawaii and buying cemetery plots in the U.S.  But like most cemetery plots, there is the ability to have just one owner in Hawaii too.  Fee Simple is explained by Hawaii Realtor Jamie Friedman,

A fee simple buyer acquires ownership of the entire property, including both the land and buildings. The fee simple owner does not pay ground rents, but does pay maintenance fees and real property taxes. The fee simple owner has the right to possess, use the land and dispose of the land as he wishes-sell it, give it away, trade it for other things, lease it to others, or pass it to others upon death.

With that, I suggest everyone get their business in order - whether real estate or burial plans - well in advance of that unfortunate time.

Photo courtesy of *Amelia* via FlickrCommons.