Any Appreciation Investors Out There?

[Wilson Cheung]

About 10 days ago, I started a thread comparing investments in Cash Flow versus Appreciation properties.  The response was overwhelmingly in favor of Cash Flow.

Are there ANY investors investing for appreciation out there?  If so, I would like to hear why you chose this path?  Secondly, most appreciation properties are in regions that are expensive (i.e. San Francisco, Silicon Valley, Boston, DC, NY, etc.).  This would mean a less diversified portfolio.  Is this a better option?

I am very intrigued.

[Jay Hinrichs]

I think it depends on if your in the business or you have a day job and your investing as a side line or as an alternative to other main line investments like stocks bonds and closely held companies.

It seems to me those of us who do this for a living appreciation and or really forced appreciation is the play.. either buying cash flow properties that have been miss managed ( probably like what@Cody L. has done in Houston turning them around raising value through better financials refinancing them.. that's quite popular..

Or others that are like myself developers.. we take raw land create subdivisions and build homes and work on a X factor not a rate of return factor.. IE with leverage we are usually at least 2X on invested capital on a 12 to 18 month cycle...

But like all things we are not perfect.. we tend to talk about the perfect projects on BP but anytime your doing this at any volume your going to have your bummers..

However for most folks the logical and the financial constraints dictate buying rental properties that will make the mortgage with the minimum down.. that's the measuring stick.. and for non appreciating ( historically anyway) markets like you see most turn key companies work in.. there needs to be positive spendable cash above all cost other wise why buy it... other than a forced savings.

Many folks could simply buy some other kind of business and do well.. we all know those who own business's and have done very well... especially if they have a business that can be sold.

Friend of mine in San Francisco sold his court reporting business for 10 million cash... But then bought 2 shopping centers one in Rocklin CA  and can't remember the other and a nice 2 million dollar home next to me in Napa... so its not only real estate many ways to make money.

Real estate is just a place to put extra savings unless your going to go into the business.

Then you have agents and commercial agents like @Russell Brazil  and myself its all we do. So we are in it daily and you tend to gravitate to what you like and know.. my wife is one of the top brokers in the Portlandia market.. and just selling real estate ( which is a long game) but can be quite rewarding financially and she digs it and is really good at it...

To me there is the thought process of being financially free and I get that people want to retire I tried the retire stuff a few times over the last 20 years it lasted about 2 months.. for me its the art of the deal.. and frankly most of my social life I could not way stop working be bored to tears.. so buying cash flow rentals is not something I really aspire to personally.. helping people buy them I do.. but not owning them.. NO tolerance for tenants anymore or PM's