Theseus' Single Wide Trailer
As discussed in my original blog, my history is in philosophy and maths. Today I was to explore an old philosophical paradox known as Theseus' Ship but apply it to a rare real estate problem. Feel free to sing a sea shanty as we explore it.
The original paradox presents the following: Theseus brings his ship in for regular repairs, and the shipbuilder being frugal removes the worn boards from his ship and sets them aside, slowly building a ship with the original reclaimed wood. Over the course of years, Theseus' entire ship is replaced with new lumber and the shipbuilder has replicated the ship for his own. The question is then posed, where is Theseus' ship?
This question is also a brain teaser when one realizes that the human body renews every single cell in it approximately every 7 years.
However, let's bring this back to real estate. Suppose I have a single-wide trailer on my home site. I build a permanent foundation for it to be affixed to, and connect it to site utilities. Has this become real estate?
According to Fannie Mae, the County, and every other definition that I know of - No. This will still be considered "personal property." However, if I were to slowly, over time, replace parts and build additions, such that after 20 years the single wide is sitting in a completely new spot on the property and a house was to be on the original site, would the house be real estate or personal property?
As far as Fannie Mae and county records are concerned - this would still be personal property. The adage "once a single-wide, always a single-wide" is as near to gospel as there is in real estate. Until the county clears the property as a single-wide and the DMV clears the dwelling as being mobile, it will likely be personal property and therefore ineligible for a loan.
Now, you might say, "But Jesse, who would do that?!" As an appraiser, I've run across this once, where everything of the original single wide was gone, except for the steel undercarriage, and additions had been built on, and all county and lender parties regarded it as a single-wide trailer.
If you stay in the real estate industry long enough, you'll see everything.