Invest in real estate now or is pullback imminent?

[blacklisted917]

Originally Posted by Atone

I have a property I may dump during this madness it’s jumped over 18% in the past year (taking that number with a grain of salt) but damn it’s hard not to sell and try to reposition that investment later. However, that seems a bit of a precarious plan

Can you cash-out refi?

Originally Posted by superdog

Here’s the challenge with that...

What next? If you have a great opportunity, then it makes sense. But when I look at the landscape it doesn’t appear ripe with a lot of potential for the casual investor.

I’ve been looking. No idea where to find good opportunities. Imho, best thing to do with an 18% increase is pay off any notes or debt you have.

Based on my limited experience, everything is a grind. And time is our best friend. With enough time, any reasonable investments appear to appreciate.

I'm actually seeing some decent properties sit on the market > 30 days - from casual observation, things seem to have slowed down a tic in class B/C multifamily; CT/MA market.

Put in an offer on a duplex and triplex last week. Would the return have been better if I purchased these 2 years ago, of course, do they pass my "hurdle rate" for returns at today's ask, absolutely. In 6+ months these are the first two offers I've sent out.

Friends that take the more aggressive approach of cold calling owners of off-market properties, sending out flyers, etc. haven't been finding much worth buying either.

[bejzv]

Originally Posted by Thrasher36

Real estate is always a good place to put your money. ALWAYS

I support this view too but then again the pandemic has made most investments options seem risky.

[airchitect]

Originally Posted by bejzv

I support this view too but then again the pandemic has made most investments options seem risky.

And it definitely makes me wonder what class I should be investing in. Right now, the only thing truly cash flowing are well bought hud props. No moratorium issues there. Everything else is a bit of crap shoot.


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[EatMcdonalds]

Originally Posted by vman

It is quite nice. Suburban vibe + jobs in IT and healthcare. Good colleges nearby, if you have kids. Many transplants from NE. Less edgy than Raleigh or Asheville. In general, if you like NE vibe without the snow and don't need the rad subculture or access to the ocean, it is a good place. My friends moved there and love it. I am down south a bit.

Originally Posted by gnuyork

I've been to Winston Salem on business and where I stayed was a downtown area and quiite charming. Walk to restaurants and bars, had a relaxed small city neighborhood vibe. I enjoyed it.

Thanks - super helpful guys. Considering buying some property there.

Research triangle prices have gone through the roof.

[Atone]

Originally Posted by bejzv

I support this view too but then again the pandemic has made most investments options seem risky.

Very true. I balked on a couple good options/entries in a few other investments and I would have killed it.

[MILGAUSS88]

I am more worried about demographics.
You have the wealthiest generation just starting to reach there life expectancy at 75 years old. And a new generation of blue collar workers making the same as there predecessors did 40 years ago. (I am basing this off of 3 top 50 manufacturers in my immediate area that now have a tiered pay system, but assume it is the same in most industries.)
I wonder how large numbers of buyers are going to come up with money to purchase the homes.

[904VT]

That's a great question. So many variables though right now and it really depends on the type of real estate. Suburbs vs City vs Rural. Retail vs Commercial. Wage taxes.

Any asset class can be a great investment any time. Just make sure to do your due diligence on a multitude of factors beyond the above. But the nice thing with collateralized assets is exactly that, as there is real value behind.

[tritium8]

Originally Posted by 1st amg

Seth call me next week...have a great start to the new year....I will start with eating less

Any way I can get on this call? You two seem like you have pretty good business sense. I'll set up the call and mute myself if you want. I've been looking to get into real estate for a long time but just have been to comfortable with the status quo.

[turkeysub93]

Tampanian checking in...the entire area is booming. Finding a good place that doesn't already have 10 offers above asking price is an anomaly.

[MrGoat]

Originally Posted by turkeysub93

Tampanian checking in...the entire area is booming. Finding a good place that doesn't already have 10 offers above asking price is an anomaly.

The only stuff you’re finding around here is if you know someone or a realtor that has a lead with a fixer upper that sells without ever listing it.


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[enjoythemusic]

Originally Posted by turkeysub93

Tampanian checking in...the entire area is booming. Finding a good place that doesn't already have 10 offers above asking price is an anomaly.

Yup! Neighbor's home sold for OVER asking in 24 hours. Come to FL. But really, move here. If you live in Cali, NY, NJ, IL... do yourself and your wallet a favor and move to FL (bring your company too). Our area is growing so fast we basically need more of... everything.

On the other hand, I'd short NYC (and perhaps San Franciso-ish area) commercial RE. Especially offices.

[turkeysub93]

Originally Posted by enjoythemusic

Yup! Neighbor's home sold for OVER asking in 24 hours. Come to FL. But really, move here. If you live in Cali, NY, NJ, IL... do yourself and your wallet a favor and move to FL (bring your company too). Our area is growing so fast we basically need more of... everything.

On the other hand, I'd short NYC (and perhaps San Franciso-ish area) commercial RE. Especially offices.

Can't help but think the commercial boom (thanks Jeff Vinik!) has caused residential prices to rise as well.

[enjoythemusic]

Originally Posted by turkeysub93

Can't help but think the commercial boom (thanks Jeff Vinik!) has caused residential prices to rise as well.

Don't want to be specific, yet the area I'm in is growing at nearly resource-limited scale. Want a pool? Good luck lining up the concrete truck. Dentist and doctors, growing so fast we need more. Have seen a handful of aces turn into a planned 200 home community in ~24 months... all sold. But wait, there are eight other communities doing just about the same thing at the same time.

FL is a big, totally customizable, sand bar. Have to admit they do create from a cleared site some mightly attractive private luxury gated communities and beautiful golf courses from 'FL flat sandpit'. Almost like Teletubbie land, but with boats, paddleboards... plus custom golf carts and guys chomping on cigars.

Heck, the new HIGH density four-story apt complexes have coffee bars, public gourmet kitchens / classes, outdoor sports / TV bar area, dog park, outdoor workout zones, on-site dog grooming... and the typical big arse resort pool, high-end workout room... Yada yada yada. And yeah, that's the apt complex. Image what's within the gated 'luxury communities'. We have ten to choose from, maybe 20.

Oh, there's also the romantic sunsets... on the USA's #1 rated beach. Tired of Cali, NJ, NY, IL...... Look fwd to seeing you soon.

[Atone]

i love and miss the florida coast but damn, you all can KEEP the humidity!

[CamSLC]

Originally Posted by MILGAUSS88

I am more worried about demographics.
You have the wealthiest generation just starting to reach there life expectancy at 75 years old. And a new generation of blue collar workers making the same as there predecessors did 40 years ago. (I am basing this off of 3 top 50 manufacturers in my immediate area that now have a tiered pay system, but assume it is the same in most industries.)
I wonder how large numbers of buyers are going to come up with money to purchase the homes.

I absolutely agree that there's stagnating wages in blue collar work. I always look at what type of employers are in the area before investing. Anything healthcare is my personal preference.

A consideration of the wealthiest generation reaching life expectancy is the largest transfer of wealth to their heirs. While it's not the majority of people, it's still substantial and will continue for the next 25+ years. The oldest baby boomers are only 77 this year.

[airchitect]

I’m looking into more development for the future and sustainable growth will be where it’s at esp in the us along coastal cities. I still cringe every time I see surface parking.


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[blacklisted917]

For those of you who own, have purchased rentals during this pandemic or turned over vacancies:

How has your process changed for tenant screening?
Have you had difficulty collecting rent from existing tenants?

[JWD531]

Originally Posted by blacklisted917

For those of you who own, have purchased rentals during this pandemic or turned over vacancies:

How has your process changed for tenant screening?
Have you had difficulty collecting rent from existing tenants?

Same. Property manager, credit score requirement, rent to income ratio requirement, background check, etc. Although my property is in TX which is fairly good for landlords. No issues so far, but I am only a few years into this journey.


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[Atone]

Originally Posted by blacklisted917

For those of you who own, have purchased rentals during this pandemic or turned over vacancies:

How has your process changed for tenant screening?
Have you had difficulty collecting rent from existing tenants?

man, i've been soooooo lucky on that front. no issues on rent collection. i think for tenant screening i would ask for 10 years of deposit

[BNA/LION]

There are cycles in every investment. Real-estate prices are very high in San Diego and interest rates are very low. The good thing about buying now is if/when we see a correction you will be locked in at an incredibly low rate but buying at the top of a real-estate market is brutal because you are out the cash and it takes more time than you think for it to come back. If you have time on your side there is nothing to fear. IMHO

[BNA/LION]

Originally Posted by blacklisted917

For those of you who own, have purchased rentals during this pandemic or turned over vacancies:

How has your process changed for tenant screening?
Have you had difficulty collecting rent from existing tenants?

No issues here with rentals. A good property management company takes all the work and worry out of the process.

[Atone]

Originally Posted by BNA/LION

There are cycles in every investment. Real-estate prices are very high in San Diego and interest rates are very low. The good thing about buying now is if/when we see a correction you will be locked in at an incredibly low rate but buying at the top of a real-estate market is brutal because you are out the cash and it takes more time than you think for it to come back. If you have time on your side there is nothing to fear. IMHO

Good point.

[1st amg]

If there is a correction, it will be small and not for a couple of years. If you are able to lock in a mortgage, try to get the longest term. For our commercial mortgages, we are able to get 10 year money, meaning we can lock in for ten years. I was quoted yesterday 1.80% for ten years. That’s nuts.


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[enjoythemusic]

Here's some more data, for those who like to trade / buy via data-driven info.

2020 Migration Trends: U-Haul Ranks 50 States by Migration Growth

2020: STATES RANKED BY MIGRATION GROWTH
1.

Tennessee (12)

2.

Texas (2)

3.

Florida (1)

4.

Ohio (7)

5.

Arizona (20)

6.

Colorado (42)

7.

Missouri (13)

8.

Nevada (24)

9.

North Carolina (3)

10.

Georgia (16)

11.

Arkansas (23)

12.

Indiana (9)

13.

Wisconsin (41)

14.

Oklahoma (14)

15.

South Carolina (4)

16.

West Virginia (22)

17.

Utah (8)

18.

Kentucky (37)

19.

Montana (26)

20.

Minnesota (15)

21.

Kansas (18)

22.

Alabama (6)

23.

New Hampshire (31)

24.

Iowa (30)

25.

South Dakota (28)

26.

Vermont (10)

27.

Delaware (21)

28.

Virginia (39)

29.

Maine (33)

30.

Idaho (11)

31.

Mississippi (25)

32.

Nebraska (19)

33.

Wyoming (27)

34.

Alaska (17)

35.

Rhode Island (35)

36.

Washington (5)

37.

North Dakota (32)

38.

Washington, D.C. (38)*

39.

New Mexico (36)

40.

Michigan (48)

41.

Pennsylvania (46)

42.

New York (43)

43.

Connecticut (34)

44.

Louisiana (40)

45.

Oregon (29)

46.

Maryland (45)

47.

Massachusetts (47)

48.

New Jersey (44)

49.

Illinois (50)

50.

California (49)

https://www.uhaul.com/Articles/About...ration-Growth/

[mwatt65]

I was looking at buying a short sale in NJ, it had mold & a leaking roof. The way the brokers behaved was crazy, their attitude was I should be grateful to put a full price offer in.
I'm going to wait & see what happens after the foreclosure ban is lifted, the cheap rates are creating crazy prices in northern NJ.

[BroncoOne]

While there is a lot of good advice and observation here, there are at least questions that you must ask yourself.

What else I would you do with the money and what is the difference in the potential ROI?

The next is what is my risk tolerance?

The third is what do my other assets look like. Do I have diversification?

[EEpro]

Originally Posted by enjoythemusic

Here's some more data, for those who like to trade / buy via data-driven info.

2020 Migration Trends: U-Haul Ranks 50 States by Migration Growth

2020: STATES RANKED BY MIGRATION GROWTH
1.

Tennessee (12)

2.

Texas (2)

3.

Florida (1)

4.

Ohio (7)

5.

Arizona (20)

6.

Colorado (42)

7.

Missouri (13)

8.

Nevada (24)

9.

North Carolina (3)

10.

Georgia (16)

11.

Arkansas (23)

12.

Indiana (9)

13.

Wisconsin (41)

14.

Oklahoma (14)

15.

South Carolina (4)

16.

West Virginia (22)

17.

Utah (8)

18.

Kentucky (37)

19.

Montana (26)

20.

Minnesota (15)

21.

Kansas (18)

22.

Alabama (6)

23.

New Hampshire (31)

24.

Iowa (30)

25.

South Dakota (28)

26.

Vermont (10)

27.

Delaware (21)

28.

Virginia (39)

29.

Maine (33)

30.

Idaho (11)

31.

Mississippi (25)

32.

Nebraska (19)

33.

Wyoming (27)

34.

Alaska (17)

35.

Rhode Island (35)

36.

Washington (5)

37.

North Dakota (32)

38.

Washington, D.C. (38)*

39.

New Mexico (36)

40.

Michigan (48)

41.

Pennsylvania (46)

42.

New York (43)

43.

Connecticut (34)

44.

Louisiana (40)

45.

Oregon (29)

46.

Maryland (45)

47.

Massachusetts (47)

48.

New Jersey (44)

49.

Illinois (50)

50.

California (49)

https://www.uhaul.com/Articles/About...ration-Growth/

Nevada #8 up from 24 last year. We're feeling it. Even the modest family homes in good areas are $500K up from $300s just a few years ago. Low interest rates and cash buyers from CA.

[airchitect]

Originally Posted by EEpro

Nevada #8 up from 24 last year. We're feeling it. Even the modest family homes in good areas are $500K up from $300s just a few years ago. Low interest rates and cash buyers from CA.

Yep everyone is moving to Nashville which can’t sustain the growth at all due to its location in a bowl surrounded by hill. Traffic etc sucked when I lived there before, and now it’s just awful. Love the place but would never move back.


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