All Forum Posts by: Jay Hinrichs

Reality is much like a gold minning town back in the gold rush days. . I think much of what goes on in these temporary housing situations is just do what you can get away with.

I see all sorts of Australian and British marketing companies hawking what amounts to hotel rooms in North Dakota to unsuspecting investors and telling them they are buying a room , Like it was a condo or something.. totally out there and who knows were it will end.

End of the day its temp housing unless you plan on keeping these long term

@Joey Budka 

very common theme what you describe.. And it does not have to be Texas its anywhere out of state.. Fact is your rolling the dice more than if you stay close to home.

Keep in mind in many of these communites 50% plus of the SFR's are rentals and have been rentals for years... Where do you think the fresh batch of distressed properties comes from well at least 50% comes from land lords that lost so much they finally gave up and left.. the other from people that inherit or lived in the hood all their lives and the values are only what a local wholesaler will pay for them.. There is no TRUE retail market like we think of on the west coast. Part of the thread was a decision to move CA money out of state. And its germane to talk about those issues that are very very real.. Especially to those that have no clue with is a good many CA investors who are priced out of CA or think they are and want to play the RE game because they can buy houses for the price of a car..

Same attitude with Australians and GB  and many of them got slaughtered by really bad folks selling them ghettos in Detroit Rochester, Buffalo , Philly and so and and so forth. There is no sugar coating it.

As for people losing money on big multi in Texas as I have stated this is also very real but the one's I had first hand knowledge on happened back in the 90s issue was could never keep them full tons of turn over B/C land is super cheap so is building and new ones pop up and raid tenants from the old ones.

But I had a friend here in Oergon buy a lower end 80 unit in Memphis against my pleading with him.. He just said owe the old management did not know what they were doing we are going to put in a new b ball hoop BBQ's etc etc.. WEll the B ball hoop was gone in a week the BBQ a day or two.. and they just sold and lost 600k in one years time and thought they were lucky to get out.

Now as to were to live well that is what you know and what you grow up with... But there is a reason there is 40 mil people in CA and its not just because of Mexico.. Its because jobs weather and incredible natural resources like no where else on earth.

@Rob Cee 

@Account Closed 

who has to live anywhere... my goal is to get me one of them motor homes.. start around Yosemite in March and follow the sun North ending up mid british Columbia then reversing.

between there and BC the amount of incredible mountains lakes wide open spaces weather is like no place on earth..  I drove across Texas once from MS to NM.. there is not a lot of appealing country side and nothing like Lake Tahoe, Yosemite valley, Crater lake, Lake Chelan, Columbia river gorge, Mt. Shasta area ,,  then you swing over to Puget sound.. I fly into Friday Harbor for lunch's from PDX in 45 minutes all summer long  East sound, Victoria , Vancouver.  Nothing compares in the US to this in my opinon.. LIttle slices yes.. And Montana Idaho Colorado Utah NM are great mountains as well but not quite as diverse as the West coast..

Then you have Southern CA its nice but only in little parts... N CA and north is were its at

@David J. 

hedge fund phenom will run its course.. I believe they will fall into the same trap as most out of area investors do at some point in the ownership process. IE returns are not matching proforma ...I think the basic issue with the SFR as a income vehicle is that 90% of these that are being bought are one's that were distressed in some manner.. vacant and in need of rehab.. There is no running history to know how the property will truly perform. As opposed to buying units or commercial you usually have the benefit of looking at and running DD on 2 to 3 years of operating expenses vacancies management etc. So an investor can get a grip on what they are buying into.

When you buy an SFR that is freshly rehabbed and tenanted the first year is your best.. You can't truly see how your returns are going to be until you have owned it for some length of time say 3 years plus.. that's when you will experience your first if not second turn over... And all other little issues that come up with rentals.

So the Hedge funds are just as much of a newbie investor as a first time property owner.. As there really has never been a charge from big companies or funds to gather up thousands of SFR's so the jury is still very much out to see how they do.. In certain markets probably well in others probably not.. Just like any newbie coming into the sfr game. I did the same thing when I sold my 45 houses in Atlanta but our timing was perfect bought at the bottom of the trough and when we could take profit we took it.. Not trying to maximize and hold on to long.. take the cash and run to the next deal

@Account Closed @Bob Yon 

You found your answer however just keep this in Mind... No hedge fund is going to do what your describing... They either buy for there own accounts. or Like Blackstone have gone into the lending bizz and only lending to experience well qualified folks.. Not rent to own folks who are some of the worse credit risks on the planet.

Its just a credit repair scam

go into the tax office and talk to someone in person... that will clear this up.

I know the fitness center,, I lived at Silverado CC so I golfed 130 rounds a year and played a little tennis..

When you look at foundations out of state if they are slab on grade and they break its a pretty big undertaking to get them back to level... What I have seen is crew comes in with 15 laborers big holes are punched through the slab every 5 feet or so.. and then big holes are hand dug down then re filled with cement. Pretty much fixed at that point as there is enough cement on one little house to build a war time bunker :)

Perimeter pier and post are not too much problem to fix as you have alluded to.. But when the foundation goes it creates havoc all over the house.. doors won't close sheet rock messed up broken pipes Roof fouled up... In the south Texas and MS your not talking just off an inch or two and a little crack your talking 6 to 12 inches or more you can get vertigo in some of those places I have been in.

Good luck on your move...

@Mike Gennaro 

  Sounds like these other RV parks are only allowing self contained units.. with no dump facility.. you would need to check with your city to see if that is allowed... Its common in the RV business to have one central dump. and no hook ups at the pads.

Also common for all RV's to be self contained and they need to drive to a dump station.

There are two sides to both Washington and Oregon.. the wet side of the cascades and the dry side... one can pick either.  Bend Oregon  is very nice,,, So is Wenantchee WA. Sun 4 seasons great out door activities year round...

either way its a personal preference.. and west coast from Vancouver BC to San Deigo is pretty hard to beat compared to the heat and humidity of anything East of the Rockies.

For me Napa Valley was the spot I lived there 10 years and I would suffer CA tax's etc to move back in a heart beat.. I was just there last weekend and it was fab. 

And yes the original post is talking about Net sheet from an MLS program.. But not net profit. YOu would need to add in all expenses and you can play with depreciation write offs and get to a net..

The big point is If you roll those dollars to cash flow rentals in the mid west or texas. the Chance that you could buy today and sell in 3 years and NET 75k profit after all costs is slim to none you may make a tad more cash flow but the tax's will eat it up.. And if your foundation goes haywire you will never recover.

@Account Closed 

for all the reasons you suggest is why Oregon and Washington are one of the great escapes for CA residences.

I agree with the post about trying to hard to avoid paying cap gains... Taxs have to be paid at some point.. and I agree with his statement take profit and buy trust deeds. Much easier to mange and will make more money over the long haul than non appreciating rentals.

Most investors that have CASH not leverage will eventually gravitate to trust deed investing.  You don't have the 3 T's... In my consulting gig we started selling TK houses and sold maybe 6 in a year but we also do financing for TK operators NON recourse and we then sell the TD's to investors... When our investors are offered both 97% choose the trust deed over the asset and all the risk... But these are people with lots of cash and are older demographic and have already been down the nightmare of owning out of state rentals.