Rent are rising

[an]

http://money.cnn.com/2015/05/21/real_estate/rent-prices-rising/index.html?iid=SF_River

San Diego is only up 5.1% YoY. That’s not too crazy when compare to SF and SJ 14.9% and 12.9% respectively. Sucks to be worker bee up there. I wonder if they will get a 13% raise as well :-).

[FlyerInHi]

To be fair, I believe those are surveys of large apartment complexes.

But sure, rents are rising, that’s why there’s a lot of apartment building activity everywhere. Those apartments tend to be high end with nice gym and facilities.

[bewildering]

[quote=FlyerInHi]To be fair, I believe those are surveys of large apartment complexes.
[/quote]

Apparently not just apartment complexes. This is their methodology:
http://www.zillow.com/research/zillow-rent-index-methodology-2393/

This is the actual link to Zillow blog article.
http://www.zillow.com/research/rent-growth-outpaces-home-values-9788/

Pretty interesting. Effectively housing will get your money if you buy or rent. If everyone is paid more, like in SF, rent will increase because of supply and demand.

[Coronita]

When will I see $1400/month for a 1/1 in MM?

When will I see $4500/month for 1800sqft in Santa Clara?

🙂

[Coronita]

It would have been nice if by this time, I had 3 SFH in CarmelV free and clear and pulling in $4000/month each.

I’d hang up my engineering hat for salaried work.

[an]

[quote=flu]When will I see $1400/month for a 1/1 in MM?

When will I see $4500/month for 1800sqft in Santa Clara?

:)[/quote]
Today:
http://sandiego.craigslist.org/nsd/apa/5029976437.html

😀

[an]

[quote=flu]It would have been nice if by this time, I had 3 SFH in CarmelV free and clear and pulling in $4000/month each.

I’d hang up my engineering hat for salaried work.[/quote]
Assuming $4k/month rent places are selling for $1M today, that’s $3M RE portfolio. If you take that $3M and buy 15 1/1 in MM today for $200k each, so you’d have it all free and clear as well, they’re renting for $1300 today. Which mean for the same $3M, you’d have $19,500/month in rental income instead of just $12k/month.

hmmm… not sure if I should have said that, maybe you’d buy up all the 1/1, leaving nothing left for me :-/

[Coronita]

[quote=AN][quote=flu]It would have been nice if by this time, I had 3 SFH in CarmelV free and clear and pulling in $4000/month each.

I’d hang up my engineering hat for salaried work.[/quote]
Assuming $4k/month rent places are selling for $1M today, that’s $3M RE portfolio. If you take that $3M and buy 15 1/1 in MM today for $200k each, so you’d have it all free and clear as well, they’re renting for $1300 today. Which mean for the same $3M, you’d have $19,500/month in rental income instead of just $12k/month.

hmmm… not sure if I should have said that, maybe you’d buy up all the 1/1, leaving nothing left for me :-/[/quote]

When you get old like me, if you had to choose between managing 15 1/1’s or 3 SFH for slightly less returns, I’d takethe 3 SFH’s…. Also, for each 1/1, there’s about $300 in HOA that doesn’t exist for SFH. Property taxes are about the same because although there would be MR in Carmel Valley, carmel valley homes don’t pay for the add on tax bonds to fund things like the community college,etc that condos in MM do…

[an]

[quote=flu]When you get old like me, if you had to choose between managing 15 1/1’s or 3 SFH for slightly less returns, I’d takethe 3 SFH’s….[/quote]When I’m old like you, I’d hire a property manager for $100/property to manage it for me. So, my $19500/month rent would go down to $18k/month rent. Still higher than $12k/month rent of SFH and I don’t have to mange it myself.

[Coronita]

[quote=AN][quote=flu]When you get old like me, if you had to choose between managing 15 1/1’s or 3 SFH for slightly less returns, I’d takethe 3 SFH’s….[/quote]When I’m old like you, I’d hire a property manager for $100/property to manage it for me. So, my $19500/month rent would go down to $18k/month rent. Still higher than $12k/month rent of SFH and I don’t have to mange it myself.[/quote]

So each condo will then produce about $900/month ($100 for property management and $300 for hoa) So that would be about $13500/month. Not too much different. Plus, more tenants = more exposure to turnover and liability.

Not that this would be my problem in the short term. I don’t think I’ll be getting 3 SFH in CV or 15 MM condos right now….lol…

Then again, any turnover in a SFH in CV wouldn’t be negligible….

[Coronita]

[quote=AN][quote=flu]When will I see $1400/month for a 1/1 in MM?

When will I see $4500/month for 1800sqft in Santa Clara?

:)[/quote]
Today:
http://sandiego.craigslist.org/nsd/apa/5029976437.html

:-D[/quote]

hahaha… That guy/girl/company is smoking some good crack.

[an]

[quote=flu][quote=AN][quote=flu]When you get old like me, if you had to choose between managing 15 1/1’s or 3 SFH for slightly less returns, I’d takethe 3 SFH’s….[/quote]When I’m old like you, I’d hire a property manager for $100/property to manage it for me. So, my $19500/month rent would go down to $18k/month rent. Still higher than $12k/month rent of SFH and I don’t have to mange it myself.[/quote]

So each condo will then produce about $900/month ($100 for property management and $300 for hoa) So that would be about $13500/month. Not too much different. Plus, more tenants = more exposure to turnover and liability.

Not that this would be my problem in the short term. I don’t think I’ll be getting 3 SFH in CV or 15 MM condos right now….lol…

Then again, any turnover in a SFH in CV wouldn’t be negligible….[/quote]That’s 12.5% higher rent. $1500/month = $18k/year. That would be enough for you to go to a track day every month and pay for maintenance cost ;-P

[Wah-Wah]

[quote=AN]http://money.cnn.com/2015/05/21/real_estate/rent-prices-rising/index.html?iid=SF_River

San Diego is only up 5.1% YoY. That’s not too crazy when compare to SF and SJ 14.9% and 12.9% respectively. Sucks to be worker bee up there. I wonder if they will get a 13% raise as well :-).[/quote]

my health ins is up %20 for next year… it’s suck to be worker bee.

[Coronita]

[quote=AN][quote=flu][quote=AN][quote=flu]When you get old like me, if you had to choose between managing 15 1/1’s or 3 SFH for slightly less returns, I’d takethe 3 SFH’s….[/quote]When I’m old like you, I’d hire a property manager for $100/property to manage it for me. So, my $19500/month rent would go down to $18k/month rent. Still higher than $12k/month rent of SFH and I don’t have to mange it myself.[/quote]

So each condo will then produce about $900/month ($100 for property management and $300 for hoa) So that would be about $13500/month. Not too much different. Plus, more tenants = more exposure to turnover and liability.

Not that this would be my problem in the short term. I don’t think I’ll be getting 3 SFH in CV or 15 MM condos right now….lol…

Then again, any turnover in a SFH in CV wouldn’t be negligible….[/quote]That’s 12.5% higher rent. $1500/month = $18k/year. That would be enough for you to go to a track day every month and pay for maintenance cost ;-P[/quote]

dealing with 15 renters doesn’t end up being a “passive investment”. It ends up being an almost full time/part time job, even if you use a property manager. I mean, you wouldn’t want to be completely hands off either, since then your costs would get totally out of wack….Also, the likelihood of getting near 100% occupancy in at 15 condos for an extended period of time is less likely than I think renting 3 houses to 3 families. Then again, I’ve haven’t been in the situation of dealing with 15 tenants yet, so I wouldn’t know if the PITA factor would really be an issue….

[Coronita]

Hmmm. Now that you got me thinking about this AN…

Maybe the solution is somewhere in the middle.
1 SFH CV rental at $4k/month and 8 1/1’s in MM

Put my current home up as a rental in CV, buy another home with a mortgage while rates are low. And wait try to buy 1 condo each year in MM….I just have 1 tiny problem though…Called “money”….

[Author]

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