All Forum Posts by: Brian Singh

First sales fall, then realtors tell sellers wait and pull the listing off- market, market will improve will improve , price fall a little. Then Sellers (bay area FOMO) . Inventory comes online all at once. Prices fall hard.

I am looking at putting money in 2020 or by mid 2021 and , I usually take out after 2 years or 5 years. 
So with that time horizon is how I look at bay area. 
Yes if my grandfather had bought in palo alto in 1950 when it was an orange yard at $ 1 a sq foot and held it today . Yes you are right. That can be said for anything. If I had got gold in 1950 it would be over 2000%. 

Thank you all for the input , it really helped me understand the bay area investors . So I will not be surprised when the sellers go into FOMO mode in September or October and start selling in bulk. It goes both ways.

In real estate you make money going in and adding value. @Amit M. seems to have figured out the adding value part so he makes $$

I am part time in RE so I focus on making money going in buying at the right price and 10% rehab budget.

to answer my logic of selecting the 4 suburbs

1. Walnut creek - mostly non tech professionals (sales , Finance etc) and salary to loan value very high, so they will face financial crisis . Thus deals will come. However HOA here is very high so resale value will be capped, thus may drop it.

2. San jose, Sunnyvalle and Fremont: This is where majority of H1B ppl live, so with no new H1B coming in demand will drop for both rental and house , thus deals may come and prices may fall to 2016 or 2015 level in a year.

SF as most people say is useless and just going down. Palo alto is rich ppl so economic conditions dont dictate that market. ( so no interest in that market)

Please feel free to tear apart my logic, I would rather be wrong here than with my money :-)

Thanks everyone for their insights. I think I have enough knowledge to go to action on Bay area. I'll start small and put 500k for a 2 Br as a test of bay area in one of the markets  below by finding a deal at 2015 prices.

1. Fremont/Newark
2. Walnut creek
3. San jose
4. Daly city
5. Sunnyvale

Any advise or general comment is always welcome. Will update when I close. Maybe nov -dec might be a good time

@Justin Thorpe It interesting to see bay area thinking. I am assuming you were born there or been there 20+ year. If you do a word cloud of your answers . It usually FOMO or outlier examples. ( not good or bad) just an observation.

I personally think Median and average tell the true story vs $1M+ houses or ( $3M in Palo alto/SF) . These people are 1% and they are not affected by normal issues like most people

Goldman Case shiller report is out they have national price drop now.

Ahmad, 
Why do you want to invest in US midwest . If you looking for cash preservation /protection , you can invest in most coastal cities in class A property. 
If you looking for yield is small town mid west the right strategy. Just curious 

@Diane G. Thanks for the Pro tip. You are right when market hits bottom most of the properties would be bad or foreclosures.

Just to clarify my statement before. I am a casual investor have a job and invest on the side. So max I do is light rehab. not major overhaul of property. If plumbing or foundation or electric is bad I run. Basically lipstick on a pig is max I go.

Thus pro here who do this for a living can make money by adding value . The statement no one made money if they bought 2018 and after applies to people like me. Who mostly buy off MLS maybe do cosmetic fixes .

@Amit M. Sounds like you you saying is 2020 and 2021 is not a good time to invest in bay area as prices will fall as per the chart , it goes till 2017 I am assuming because prices have gone back to 2017 level.  As we did in our research above anyone who bought a house 2018 and after has lost money in bay area.

Prices dropped for 4 years last round so 2022 end maybe time to look back at bay area.

Thus what I am concluding from this amazing inputs is that

1. Bay area market is not worth investing in till 2022.

2. FOMO and YOLO bay area culture cannot sustain both startup and house prices. Its back to basics there.

As for the urban legend stories of housing dissapearing in 10 mins , it seems a bay area FOMO thing. I am looking at MLS and I see both good homes staying until they reach 2017 price level and housing flying. It could be "not so smart" home buyers making emotional decisions.
Once inventory piles on in september , it be interesting to see if we still hear the stories.  
Its all about supply and demand. Supply will increase , demand not so sure for bay area till 2022.

So the 2020 and 2021 strategy for bay area

Rentals- Losing money so not worth

Buy long term and hold- Not worth it , wait till prices drop stops or goes down to 2014 level.

BRRR and flips. Buy at 2015 prices and hope it apprises at 2017 level.

What do you all think ?

Thanks everyone for the info. This is very interesting .
@Account Closed Can you elobrate why walnut creek is falling vs nearby antioch which you say is going up, both seem close by in google map , I am quite sure there is some local info you know that would explain it.