Among the most interesting phenomena of the ongoing housing crisis is the growing inventory of small inns on the market at roughly half their value.
On its face, it's a bit perplexing. Lenders know, after all, that when they shut the doors of an inn, they may as well just chop the asking price in half.
While you'd think that would inspire many of them to put in a good management team and remain open, many are choosing not to go that route. No, many lenders are deciding to just close up shop and sell the foreclosed inns they now possess at half their value. Half.
To say this is having a negative effect on the realistic selling price of any small inn, well, that would be quite the understatement. Snow meet ball.
So why would lenders dump properties like that?
Well, it turns out that managing inns is just not as easy as many of them would have thought. Turns out every decision does not come down to simple numbers. Sometimes you just have to do the right thing. We're called the hospitality industry for a reason. We're supposed to be, you know, nice to people. Including our own.
In the long run, the bankers might be painfully right in their own silent assessments.
The headaches that result from disastrous decisions made by bankers and not by professional innkeepers are enough to make any lender think twice about taking over management. Headaches aside, they're also the kind of decisions that will have the exact same effect as an asset dump: the inn will be devalued anyway at the hands of the lender.
You can take that to the bank.
