...nothing?
Most of us probably remember the Whitewater nonscandal...years of investigations by an aggressive and unfriendly prosecutor were unable to implicate the Clintons in any wrongdoing.
Now bubbling into the news are alleged improprieties in the purchase of a home in Chicago by the Obamas.
In a highly recommended recent diary, Greuden did us the service of linking to an informative piece on the issue. For the first time the seller of the property spoke out and what they had to say was quite interesting. The diarist couldn't help having a bit of fun with us...a few folks commenting before reading all the way through got a bit of 'egg on their face'...but I wonder how many...after recognizing the snark...clicked the link and read the article?
here's the link again:
http://www.bloomberg.com/...
The reason I post it is because I think with a quick read through...and a little arithmetic some issues arise that might make it more difficult to dismiss this story out hand. I hope a real estate expert or two (always good to get a second opinion) might comment here on the plausibility of the interpretation that follows...
To be brief: The structure of the deal represented a payment of 70,000 from the Rezko's to the Obama's. If you've read this far you might say...how?
Starting with the last paragraph of the story...the senators campaign associate acknowledges that
the sellers had ``stipulated that the closing dates for the two properties were to be the same.''
Not a big deal I guess...maybe they originally thought they would sell the whole property to one person...and settling it all on the same day to several parties eliminated some headaches...and in fact the sellers did get what they wanted...as noted in the story...
Rezko's wife, Rita, also an Obama donor, bought the adjoining plot in Hyde Park from the couple, Fredric Wondisford and Sally Radovick, for the $625,000 asking price, the same day that Obama bought the house for $300,000 less than the asking price. Antoin Rezko was under federal investigation at the time.
Ok great...so what's the issue? It is right there in the grey paragraph above.
According to the article...which is based on information from the seller, the asking price for the properties was 1.95 million for the house and 0.625 million for the adjacent lot...a total of 2.575 million. Instead the sellers received 2.275 million.
1.65 million from the Obama's, a 300,000 discount (about 15%)
&
.625 million from Ms. Rezko which as noted above was exactly the offer price.
Suppose the sellers sold to one person only. They might have sold it a little cheaper to avoid signing so many papers...but for simplicity lets assume that the 'same day' requirement fully addressed that concern.
If a single person had bought the property it would of course not have been possible to shift the discount to one party (the home buyer) and have the other pay full price (the lot buyer).
As a seller would you care how much of what you were getting came from one part and how much came from the other?
However you personally answered that question...the fact is that the 2.275 million received was about 88% of the entire asking price.
If the Obama's paid 88% of the home's asking price, and the Rezko's 88% of the lot's asking price (again...a single buyer could do it no other way)...simple arithmetic demonstrates that the Obama's would have had to pay about 1.723 million for the house...and the lot price .552 million.
So failing to spread the discount from the asking price across both buyers saved the Obama's
1.723
-1.650
------
.073 million dollars
or 73,000 dollars.
As noted above, insight from real estate professionals is welcome. This is just what I deduced with a few calculations in Excel.
However,if it is not a problem...no doubt it could be portrayed (and construed) as one by those unsure of or less favorably inclined to Obama than many of the commenters on the earlier recommended diary thread.