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Anyone investing in Real Estate now?

Melensdad

Melensdad

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Anyone out there starting to shop, or thinking about shopping, or actively shopping for some real estate bargains (for rental income)?

I realize each market of the nation is different, some have been in deflating for a while, others are just starting to deflate. Some markets probably will deflate 5% and others maybe 40+%. But it strikes me that for those with cash on hand it might be a good time to start buying up some rental properties at bargain prices.

Thoughts?

I've been a commercial landlord for quite a while on multiple properties but I'm seriously looking at the residential market now.
 
XeVfTEUtaAqJHTqq

XeVfTEUtaAqJHTqq

Master of Distraction
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I'm waiting until November-January for things to settle down. I don't need to be the lowest or the highest - I just want to ride the wave in the right direction. ;)
 
Melensdad

Melensdad

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PB, agreed that riding the wave in the right direction is smart, and each area of the nation is going to be different in terms of how high the crest of the wave is or if it has already crashed.

In my case I'm in a market that really didn't go up too much so we don't see a lot of deflation, especially in the rental properties but what we are now seeing are people who borrowed heavily and getting rid of properties because they lack cash. Its a lot different than what is happening in Las Vegas or parts of Florida where people are seeing massive deflation in property value.

It strikes me that no matter what, there has to be selective buying to grasp the opportunities that are out there.

For example, I've got a guy offering me a 2 unit (2 small houses on 1 extra large lot that is also developable for commercial purposes) for $99,000 with a lake view (across the road from the lake) that has rental income of $1500 per month and low property taxes. One of the units needs some serious fixing up, the other is in fantastic shape. But even dropping $20 or $30K into the property still yields reasonable return, not fantastic, but not bad, and the property is sitting in a place where appreciation over the next 10 years is very likely but over the next 2-to-3 years is very unlikely due to the overall housing situation. So even without appreciation its not a bad deal, but if looked at over a longer term with appreciation factored in a few years down the road its got some nice potential. Seems like this is not a completely unusual opportunity.
 
Erik

Erik

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I'm not - but then I just closed on my own mortgage earlier this month after spending 2 years building the house - but I have a coworker who has spent the past year or so buying up adjacent properties and putting duplexes on them as rentals. Each one they complete, as soon as it's rented they buy the adjacent piece of land and build another. I think they just finished their 3rd or 4th duplex and all are fully occupied in the $750-900 per side range.
 
DaveNay

DaveNay

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Still haven't reached the bottom...


Home prices post record 18% drop

The 20-city S&P Case-Shiller index has posted losses for a staggering 27 months in a row.

By Les Christie, CNNMoney.com staff writer
Last Updated: December 30, 2008: 11:13 AM ET

NEW YORK (CNNMoney.com) -- Home prices posted another record decline in October, falling 18% compared with a year earlier, according to a closely watched report released Tuesday.

The 20-city S&P Case-Shiller index has posted losses for a staggering 27 months in a row. In October, 14 of the 20 cities set fresh price decline records.

"The bear market continues; home prices are back to their March 2004 levels," says David Blitzer, Chairman of the Index Committee at Standard & Poor's.

Sunbelt cities suffered the most, but most of the country is watching home values fall. In Phoenix prices have plunged 32.7% since October 2007, Las Vegas home values are down 31.7% year-over-year, while San Francisco prices fell 31%. Miami, Los Angeles and San Diego recorded year-over-year declines of 29%, 27.9% and 26.7%, respectively.

"As of October 2008, the 20-City Composite is down 23.4%," said Blitzer. "In October, we also saw three new markets enter the 'double-digit' club."

Atlanta, Seattle and Portland reported annual rates of decline of 10.5%, 10.2% and 10.1%, respectively.

"While not yet experiencing as severe a contraction as in the Sunbelt, it seems the Pacific Northwest and Mid-Atlantic South is not immune to the overall demise in the housing market," Blitzer added.
Click to expand...
 
Mith

Mith

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How about building? Lots of trades looking for work so prices should be low. Land is clearly cheaper with fewer developers out there.
I think there is also a lot of room to rent out properties.
The people who make the money here are those who buy just before it goes up, timing is going to be everything.
 
BigAl

BigAl

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My son is currently looking for his first home . I can still see a housing market that will continue to slide for awhile . How long ??? Thats the 64 dollar question. We will see a turn around in 2009 ,but i believe it will be in a 2nd quarter at least .
I am currently planning to lease or rent my California home until housing prices rebound a little . Of course , with the right renters/lease agreement ,I may keep it as a investment property .
 
Melensdad

Melensdad

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Down here in Florida prices seem to have dropped considerably. But I'm thinking they are not at the bottom. Maybe another year? Maybe even a bit longer.
 
P

peterjems

Banned
The Real Estate is good for investment.The real market has been seeing multi level rise in the past few years. If industry sources are to be believed, this upward drift has no sign of coming down or even lying flat for few more years to come. The facts that major real estate companies are going public, proves the potential of the market.
 
Dargo

Dargo

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B_Skurka said:
Down here in Florida prices seem to have dropped considerably. But I'm thinking they are not at the bottom. Maybe another year? Maybe even a bit longer.
Click to expand...

Old thread, but it's about a year after this quote from Bob. I'm thinking that things have come close to bottom. I've bought twice in the last few months at auctions. Now I need to get busy and get them ready to rent.

In Florida....I don't know. A retired business partner of mine may have to start working again. About 5 years ago he kept saying that "you can't lose" buying in Florida. He literally spent millions buying homes and condos in Florida. I think he has a few hundred thousand dollars worth of Florida property now. :whistling:
 
Melensdad

Melensdad

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Dargo said:
Now I need to get busy and get them ready to rent.
Click to expand...

And there is the downside. I have a partner that does that stuff. I don't want to have to mess with rental issues other than signing off on the lease and doing some of the paperwork. Dealing with tenants is the downside to rental property, even qualifying them and negotiating a lease can be a PITA.

One thing I'm not really keen on are individual homes for rentals. I'd rather do a multi-unit. Looking for a 4 to 6 plex now, I want to move my sister in law into 1 of the units. She can become the onsite manager in exchange for free rent. Its a money loser, but sanity gainer for my family as she needs her own place and we want our house back!

I think the real money is in the commercial side, especially if you only buy options to control the sale of the property to the buyers.
 
Dargo

Dargo

Like a bad penny...
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I believe our thoughts are similar. The house I just bought yesterday is directly across the street from my brother and sister in law. He is retired and does HVAC work just to have something to do. The lady who lived there had been a widow living by herself for the last 25 years. The good part is that, if something broke, she called a professional who was listed by our local building inspector for being a 'recommended' company (for whatever she needed done) and fixed any problem right away. I've seen examples of where people let small problems ruin their home; like water issues to be specific. Why people don't worry about a leaking roof is beyond me.

So, with my brother in law begging to help fix up the home and to act as landlord, that was a huge plus for me. As I mentioned to you, my other recent purchase was going in with another guy I've known for 30 years and buying a self storage place. I didn't realize how much money is there to be had in those self storage things. Personally, I think they are eyesores, but they are money makers.
 
REDDOGTWO

REDDOGTWO

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peterjems said:
The Real Estate is good for investment.The real market has been seeing multi level rise in the past few years. If industry sources are to be believed, this upward drift has no sign of coming down or even lying flat for few more years to come. The facts that major real estate companies are going public, proves the potential of the market.
Click to expand...

Where have you been the last year or two, in jail without access to the news? If not, this could be arranged.
 
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