CAMBRIDGE, Maine — Unhappy with the stock market performance, Patti Dowse of Cambridge is investing her money instead in improving the region’s housing stock while providing local jobs.
Seated in her modest home recently, Dowse, who owns and operates Erda Leather in Cambridge, said she purchases homes at auctions, upgrades them up and resells them for a small profit, even at times, assisting the new homeowners with financing.
“I just don’t feel happy with money in the stock market. You know I love the idea of doing something more real with it,” the businesswoman said.
Dowse said it was a few years ago when she first looked into the housing market and began studying the auction process. When a friend planned to attend the auction of a house in the region but found she couldn’t make it, Dowse offered to attend the auction.
“What I saw was this great house that went for chicken feed,” Dowse said. She recalled she went home and convinced her husband Dusty that they should invest in the housing market. “We agreed to take out $60,000 which was a considerable portion of what we had and I would buy a house, fix it up and sell it,” she said.
Dowse said she sold her first house several years ago and then used the money to purchase another. Then the housing boom began and she had trouble finding another house because others had latched onto “flipping houses” — buying them at auction, repairing what absolutely needed fixing and then selling them for a profit.
The second house she purchased was in Charleston, and after making the repairs, which included new underground wiring, she sold it to a man who had no credit but did have a $25,000 down payment. She said people with no credit would have to pay 12-14 percent interest to a bank, so she offered the man a loan at 7 percent, which he gladly accepted. Even if the man defaults on the loan, with the down payment he made and the improvements he has made, the house is worth way more than he owes, she said.
Along the way, Dowse said she learned that energy audits are worth their weight in gold. Now when she purchases a house, she conducts an audit and has local contractors make the recommended changes. That audit proved to be invaluable for the improvements she made to the Cambridge General Store which she purchased at auction and then resold to a family from Massachusetts, again taking on a mortgage. The family had previously purchased a home she had renovated nearby.
Before the energy audit and improvements, the electric bill paid by a previous owner of the store was $1,100 a month and now it is $400 a month, Dowse said. Before Dowse purchased the store at auction for $60,000, the building had been vacant.
“To me it’s like a win-win-win. The community wins because you’ve got a building that’s back on the tax roll and occupied,” Dowse said. “I feel bad when you see a perfectly good building going to waste, it just kills me, then you have all the people who get to work, which is wonderful, and then the third part is you have a family that gets a house or a business.”
With all but one, Dowse said she has been able to sell her homes below market value.
“I’m not greedy, I’m not trying to get top dollar for them, all I’m trying to do is make a little something for my time. It’s been pretty gratifying.”