All Forum Posts by: Mike Russo

I started another post about the bubble question. In the Chicago suburbs where I live and invest, prices have risen significantly in the last two years but I think it is due to lack of supply...not a bubble. Very few single family homes are being built here. There is  no open land to build. I'm not comfortable paying $200 sq ft for something that cost $150  sq ft two years ago. My question is, what would cause prices to drop here? I don't see another 2008 housing bust on the horizon. I appreciate your thoughts.

Yes Matt. I thought about the timing and winter. That would be an issue for me because I rent to families in single family homes. Yours is an apartment (perhaps more single renters) so I thought harsher weather may not be an issue. Best of luck!

I agree with Jeff. People can present well when you first meet them and then become difficult to deal with. The beauty of the MTM for you is that you can give them a "trial run". Perhaps allow them the MTM for now and tell them you will seriously revisit the year-long lease in four months. By then you will have a little better picture of their character.

Thanks for the charts Ken. Seems like a good time to be a property owner.

Thanks for your thoughts Robert. Interestingly, there are very very few (if any) single family homes being built in this area so the idea that supply will catch up doesn't seem to enter into the conversation.  That's why I don't believe we are in a bubble here. To Dustin's point earlier, my preference is to receive cash flow and see capital appreciation by buying right.

Thanks Dustin. The risk is overpaying for a property. Like many other purchases, we like to buy on sale or at least a fair price.

Hi all,

l live and invest in the western suburbs of Chicago. In the past year or two, housing prices per sq ft have risen significantly and as a result, a house selling for $240k now lists for $270K and sells within a couple of weeks. I wouldn't call it a bubble because it appears to be a function of supply. The question is, do I hold off on purchases and wait for prices to drop (if they ever do) or accept the new prices?  I'd appreciate your thoughts.

Mike

Thought provoking and varying answers folks. You've given me more to think about. In Russell Brazil's podcast, I believe he discussed inefficiencies which made sense to me.

Thanks again!

Mike

I recently heard a investor on a podcast say, "The real estate market is the most inefficient market in the world." I stopped to think about that statement and I'd like to flush it out. Do you agree or disagree and why?

Thanks much!

Mike

In addition, you will want to study the laws regarding rental properties in Chicago. Mark Ainley and Brie Schmidt can help you there too because they are seasoned veterans on the topic.