All Forum Posts by: AP Horvath

@Joe Partington

Well, assuming those numbers are solid and there aren't other issues with it or with the market -- AND if you can acquire it for 5% down -- your cash-on-cash is ridiculously good for (33%) and your payback period (2.4 years) is ridiculously fast. 

Your expense ratio appears to be too good (25%) --- but hell -- maybe that's what it is. 

I put your numbers in a model I built for this -- check it out: 

Investment Summary

As I said earlier in this thread, these subsidies will only cause general prices to increase -- therefore, it wouldn't surprise me if this inititaive were supported by and lobbied for by home builders and developers ---- it greatly benefits them. It also benefits those who already own residential real estate in California. 

At the end of the day, financing basically only exists to support producer prices.

Think about it this way -- if 15, 20 or 30 year mortgages (and their exotic variants) were suddenly outlawed, and a new home buyer could only buy a home with cash savings -- what would happen to home prices overnight? 

If it isn't patently obvious, they'd plummet.

As someone else on this thread mentioned --- this is exactly what is behind the insane rise in college prices: the availability of financial aid literally creates price increases in tuition. 

Do away with or severely curtail the ability to finance an education, and college tuition comes down drastically. 

If these subsidies are put in place -- they will, ironically, only serve to INCREASE home prices.

What sort of per acre/per SF prices are we seeing for unimproved land (zoned heavy commercial/industrial) near Austin airport? 

@Henry Clark

Sweet project. 

How'd you obtain a $1.5m all-in project cost while the appraisal came in at $2.3m for cost? Doing a lot of the site prep work yourself? 

I know that you know plenty more than the average appraiser -- so please share.  

:) 

@Emilio Ramirez -- I drove up to Fort Worth and put eyes on the Box Office business park, and it looked good. Lots of activity and occupancy looks strong. 

@Michael Bell

I have a little bit of real estate development experience. In process of entitling and building 13k of office-warehouse. 

When you say "extremely lucrative" --- what do you mean by that specifically?

35% internal cap rate? Project payback period of two years? 100% IRR?

@Michael Bell -- do you have any experience with semi-truck parking lots? 

Anyone see a "successful" office park built on shipping containers? What made it work? What didn't work? 

Something like this:

http://boxofficewarehousesuite...

By successful, I mean getting competitive rents and high occupancy with single-digit project payback period -- not simply a cool, funky aesthetic. 

@Joe Bertolino

El Dorado Hills looks like a very nice place on the way to Tahoe --- but Sacramento isn't the same with respect to jobs and future job growth as Austin or even Boise. 

@Courtney M.

Agreed. If you're living in the Riverside or Corona and commuting into OC or LA, you might might as well as move to TX. The IE isn't the same as coastal SoCal when it comes to weather.