All Forum Posts by: Stephen Stokes

@Vivek Sapre the information you seek can be found in the multiple listing service (MLS) which is accessed by a licensed and subscribed real estate agent.

More [non-anecdotal] evidence that things are slowing down on the macro level

https://wolfstreet.com/2021/07...

@Natalie Wells are you saying that you are willing to pay today for what it could be tomorrow even though today it is clearly not that today? I am personally only willing to pay today for what it is today and look at my exit strategy for the opportunity of what could be tomorrow (profit). This way if I am wrong I am not left with what could have been but did not end up and stuck paying for what I thought could have been. I have seen good syndicators embedding higher exit cap rate environments in their prospectuses to lean on the side of caution as well so that is a potential double whammy . 

@Sandy Pathak if you have not already gotten an education it will be much harder to be successful. I suggest Bill Bronchick’s course on finding motivated sellers. https://www.legalwiz.com/store/marketing-to-find-motivated-sellers/

@Sandy Pathak Suggest to learn to market directly to distressed sellers. There are always deals, I just closed on one and have another in the funnel. Stop looking at the MLS expecting to find a good deal, that's where retail buyers and sellers operate.

@Jeffrey Donis presents another option that I overlooked which is to partner with another investor. 50% of a deal is better than 100% of no deal.

@Colleen West try working with small banks like Prosperity or Sonora bank. The smaller banks work off different set of rules because they do not have to conform to GSE standards if they hold the loans on their balance sheet instead of selling them (portfolio lending). You can also look at hard money lenders like HouseMax to take down the property, stabilize rents/income and then refinance to long term portfolio loan.

@Natalie Wells I am curious how investors are justifying these extremely low cap rates. You mentioned that 3% caps don’t scare you but are not ideal. If the risk free rate (20 year treasury) is 2%, how can you feel confident with a 1% risk premium? Not trying to bash anyone here just really want to understand how folks are thinking about these low rates.

@Sai Kiran Unsustainable is a word that comes to mind. I also watched the video today and am not sure I agree with his argument 100% but is certainly calling out an anomaly that no one wants to pay any attention to right now. However, I have also been tracking and observing the same shift he explains.

Going against the narrative of the times is tough and you will usually not make a lot of friends that way. Just look at how the mortgage bankers laughed Peter Schiff out of the room when he said a mortgage crises was coming in 2007. I am certain you will see many people come in here and comment how this time is different, well I am here to tell you that is what they always say!

My crystal ball is broken but I do not see an abrupt crash in prices coming this year due to all the printed cash (some 25% of the total worldwide money supply created in the last 12 months) but certainly data is showing a cooling off period is in store somewhere in the near future. That said, if several events collide at once, all bets are off. Think of Bitcoin and other Crypto crashing to $0, stock market declining 20%+, Tesla filing for bankruptcy, eviction and foreclosure moratorium expiring, oil at $150/barrel, Fed raising rates to combat hyperinflation, interest rates on 10 year treasuries going to 3%+, China invading Taiwan, and more civil unrest in USA all happen before the end of the year....Austin market and every other real estate market will plummet quick. 

No one can tell the future, and anyone who attests to knowing what will happen is a fool, but understanding what risks are out there in the micro and macro are part of being an educated investor that makes calculated risk based investments. 

@Jaron Walling thanks for sharing.