All Forum Posts by: Eric James

At present one issue is commercial loans that will have interest rates adjust in the next year or so. Those owners may be forced to sell for a loss/ be foreclosed on.

The residential market is hanging on, with many not selling to hold on to a low rate mortgage. This is helping keep prices up. But what if conditions change? For example, unemployment rising several percent, forcing an increasing number of people to seel their homes into a high interest rate environment? We may only be at the beginning of difficult times.

unemployment data in all sector is showing that the job market is too strong and unemployment is reduced.

please do note that these "so called recession" is not a natural recession, but a "technical recession" created by gov. policy , the real economy itself is just fine , prior to 2020 Fed is already doing QT but then due to covid they printed money too much (not accidentally), now they have burnt the money , but they already announce they would print the money again next year. It's not that complicated.

price would going skyrocket again til 2025 lol

Do you have data to back what you replied?

Jerome Powell says the economy and employment markets are strong.....so it must be true. LOL.

1 Vote

Data say it did happen. Vacancies rose in Vegas (and nationwide) during the GFC.

https://www.deptofnumbers.com/rent/nevada/las-vegas/#vacancy_rate

0 Votes

At present one issue is commercial loans that will have interest rates adjust in the next year or so. Those owners may be forced to sell for a loss/ be foreclosed on.

1 Vote

Quote from @Bill B.:

No idea. Rents were going up for me. Properties lost value but provided more and more cashflow. PROBABLY, they are talking about people with either adjustable rate loans or introductory periods with interest only payments where their payments suddenly rose. I only did fixed rate loans.

In some places rents did go down. For example, homeowners putting their houses up for rent rather than sell for a loss. Driving rental prices down.

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Isn't population growth one of the principal factors for investing in real estate?

0 Votes

Oakland, California

Banks loaning at 3% interest remind me of investors buying 3 and 4 cap real estate.

1 Vote

Eugene, Oregon

I'm a man. Men produce value.

2 Votes

Quote from @Jay Hinrichs:

being a residential agent could be very difficult outside of your warm market IE other teachers family and friends.

there are other sales positions though that could cater to nights and weekends.. Timeshare . Land sales Vacation fractional sales

some leasing gigs etc etc..

This is what I typically see with realtor business. Literally everyone has a family friend or relative that is a realtor. If they didn't contract that person as their realtor it would generate bad feelings, so that person automatically gets their business

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Oakland, California

To me, the holy grail isn't a choice between appreciating vs cash flowing real estate. It's value add real estate than one can somewhat quickly recoup the initial investment

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Quote from @Carlos Ptriawan:

Quote from @Rachel Simpson:

Hi all. I am analyzing a deal that is outside my comfort zone and I am very much in my head and overthinking it. I am hoping for insight from more experienced investors.I currently invest in a class C (probably C-) area that provides fantastic cashflow but will likely not appreciate as well as other markets.

I have the opportunity to purchase a duplex (Class B neighborhood) in an area that is seeing job growth and with steady increase in both rents and real estate prices. Professionals/ hospitality workers are moving to the area as they are being priced out of the nearby tourist areas where they work. It is also near a large naval base that is going to be adding more jobs, as well. Large development of very nice single family homes being planned for in that area.

Here is the catch. Right now, it will cashflow MAYBE $50 a month when considering capex, maintenance, etc (Thank you, interest rates). It would be an appreciation buy, mostly. INSIGHT PLEASE! I feel like I need a property like this to balance out my doors in a less savory market.

One way to look at this very problem is this:

how do you able to hedge inflation ? We know $100 in year 2000 is only worth $62 in 2023.

So if you have cash of $100k in 2000 and still put it inside wells fargo checking in 2023, you're basically poorer.

Now the only way to hedge againts the inflation is by ........... having 20% LTV mortgage with fixed rate to a house that's accelerating higher than inflation. If inflation is 3% and your home appreciation is 3% you actually don't have appreciation. THat's the very fundamental problem with the cash-flowing property as they underperform to inflation rate, and reason why it's recommended to have both as strategy , but in my own personal opinion, the appreciation higher than inflation should be #1 priority. Then CF.

Actually, buying with financing means your making that 3% appreciation is on the full loan amount/property value. So the return on your downpayment is substantially more than 3%, depending on how leveraged the purchase was.

3 Votes

All Forum Posts by: Eric James

Eric James has started 22 posts and replied 2235 times.

Post: How did you get crushed in 2008 due to overleverage ?

Post: How did you get crushed in 2008 due to overleverage ?

Post: How did you get crushed in 2008 due to overleverage ?

Post: How did you get crushed in 2008 due to overleverage ?

Post: Anyone see the Bay Area Prices going any lower in the near future??

Post: When there is blood in the banks buy Real Estate

Post: What's your WHY?

Post: Is there a such thing as a part time realtor?

Post: Buying in an appreciating market vs. buying for cash flow

Post: Buying in an appreciating market vs. buying for cash flow