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All Forum Posts by: Frederick Kuo

Frederick Kuo has started 2 posts and replied 21 times.

Originally posted by @Jenifer Levini:

@Frederick Kuo I’m a real estate lawyer & investor based in Santa Cruz. Here’s what’s happening in this residential market. Google, Facebook, Tesla & other local high tech companies have announced that their employees no longer have to come into their offices. So thousands if not tens of thousands of people are moving from places like Mountain View & San Jose to more beautiful, peaceful & lower density locations within driving distance like Santa Cruz. Last week a house went on the market & received 13 offers the first day. Based on this exodus out of the valley into surrounding areas, I expect that areas like beach towns & wine country will be seeing a boom in residential housing. On the other end, the market for commercial is very soft. Tenants are contacting me trying to get out of leases. Anyone who can come up with creative ways to repurpose office space & retail will have a lot to choose from. I’m really sad to see the death of many great restaurants. I hope something great grows from their ashes.

 Very interesting. Santa Cruz is one of my favorite cities btw, beautiful place, great vibes.

Will be very interesting to see how this market adapts and develops with all of the economic and social changes being accelerated by this crisis.

Rent to value ratio in the Bay Area is notoriously low but future appreciation potential is high. There are a lot of choices for you but it depends on how much you plan to spend, that and location preference will determine your range of options in the Bay. 

Realistically No. I am sure you may be able to find some kind of down payment assistance program that may allow you to purchase a property on the cheap, assuming you live in a state where you can easily find homes under $80,000 or so. However, $1500 leaves you no room in case an emergency inevitably comes up, e.g. broken HVAC, water heater breaks down, major plumbing issues arise, etc. 

I think if you live within 1-2 hours from a property, foregoing a property manager may be an option, perhaps it may even be preferable. However, for investors with out of state properties, I think having a good manager on the ground is crucial.

I think you have valid concerns about their financial health and it is not unethical for you to reject their application based on those concerns. 

I think the market obviously provides high returns for smaller investors depending on the property, although the weak economy and high housing inventory are risk factors. 

Originally posted by @Scott Scoville:
Originally posted by @Raju Balakrishnan:

Apart from other factors in other parts of the country, the impact of work from homes can be significant in bay area. If the productivity remains good during this shut down, may techs may allow employees to work remotely more on an ongoing basis. This will reduce the price pressure in priciest areas and increase prices in more remote areas. This will reflect in lower appreciation in SF, South Bay and parts of east bay also while places like tracy, Morgan Hill, Stockton, and even Sacramento increasing in prices over longer term. 

Yeah, I work in San Francisco, but live in Sacramento. I've been looking at Stockton real estate for a while, and wondering if and when you'll see bay area transplants start moving out that way. They're already moving to Sacramento. Have a ton of co-workers in Tracy. Going to be interesting to see the upcoming trends.

I think one major trend that will come out of this crisis will be teleworking and working remotely. As we have seen with the technology that exists today, that we can certainly work remotely if necessary. Considering the gridlock that has become a nightmare for many Bay Area workers and residents, I think there is a real chance that as teleworking becomes mainstream, this will reduce buyer demand in the city and penninsula and increase demand in the east bay and adjacent areas of the Central Valley like Sacramento and Stockton.

Originally posted by @Brian Garlington:

Lots and lots of posts on this subject already and.....not coincidentally......lots and lots of disagreements.

 Must've missed them. Will check them out.

Originally posted by @Tracey Robinson:

Hi, I’m a novice, trying to get into making extra income through real estate though I do have stable employment. Have just sold a condo and must do 1031 exchange by July 15th. Will have 400K as liquid funds from that, and have to spend 800k to avoid paying  66k of capital gains. Before covid, I had thought about a buying a home in Palm Springs to do as Airbnb, now that makes me very nervous. My ideas now have run all the way from just paying the capital gains ( due to fear of what will happen in the RE market ) to buying rental property on a platform like roofstock. I do have time off in June and July to find / research properties anywhere in US but no expertise in that area. 
Would appreciate any suggestions about what to buy, locations that may be best in light of covid / effects on the economy and if it would be best to buy up to 800 k or pay some boot because of economic uncertainty.
Ideally, if I could chose, I know this is not the best time to be selling / buying but this is a done deal that was in the works for months before covid was known. I do have good / stable income in the medical field, and good credit FICO score around 830 so I think I would be able to get a loan. 
Thanks for any advice! 





 If you are primarily looking for passive income, I would look to purchase a stable NNN commercial property with a tenant whose business has not been severely impacted by Covid19.

I am curious as to where all of you think the Bay Area market is going after Shelter in Place is lifted and the COVID-19 crisis starts to wind down? Currently, it is difficult to assess the true impact on the local residential market because many sellers are withholding their properties, showings are limited and many buyers are taking a cautious approach. In addition, with the extension of the shelter in place ordinance, local businesses will be impacted and this will mean increased unemployment for the foreseeable future thus leading to a weakening of buyer demand.

It is hard to see a crash in residential real estate prices mirroring that of the housing crash of 2008 simply because the cause of this crisis is not rooted in the health of our industry but due to a public health crisis. However, if unemployment skyrockets and significant amount of businesses are unable to recover, this will eventually lead to higher defaults on mortgages and increased numbers of foreclosures, all of this will lead to eventual and significant declines in home values in the market.

In my opinion, the one segment of the real estate industry that will be most impacted by this crisis is commercial retail. Since many of the public health concerns surrounding this crisis are associated with the impact of social gathering, that in effect will destroy many brick and mortar retail businesses. It seems as if the forces that were already impacting commercial retail such as automation and online retail, has only been expedited by Covid-19, and many mom and pop restaurants, retail businesses without deep pockets will not survive simply because the crisis for their businesses will not simply end with the lifting of shelter in place, but will only end when the fear of this virus dissipates which may be many months to a year from now when we finally have approved and effective treatments along with a proven vaccine.

In contrast, I would be curious as to what thoughts are on which industry segments will thrive post-Covid19.