You’d have to be an idiot to buy a house

[temeculaguy]

[quote=peterb]Consensus on this site may seem fairly negative but the residential RE investor world is not. I follow several RE investor blogs and groups that actually meet in person on a regular basis…they’re very much in a “buy” mode. I attended a meeting last week that was standing room only for about 300 people. I was on a conference call about 3 weeks ago that had 150 people on it. The message and the thought was very much about scooping up the $150K to $250K homes as rental units. And from what I could gather, with relatively low down payment loans. The numbers dont leave a lot of room for staying cash flow positive if they have to lower rents. [/quote]

Peter, you are one of the most bearish posters and you have to admit that there are many investors looking into taking advantage of the public’s fears. I’ve taken your advice lately and looked into some of the websites you mentioned a while back. The “buy” mode that investors are in is exactly the floor I was referring to, they want the scardeycats of the world to be scared and they will gladly rent to them now and sell to them in a few years. I’m holding off for now on my rental unit plans but I can say that some markets are more ripe than others, especially here. I have two relatives in escrow for rental untis with a 40% cash flow cushion, trying to stay under the 150k mark and only looking at stuff well below 100x rent multiplier, specifically 70x or 80x. I can;t say that they are wrong. These are people with no mortgages, who pay cash for rentals, smart people, people in the game for many cycles, people I respect and people that can buy and sell me many times over. Everytime I call them, they are busy buying another property. I’m left with the belief that in the next two years, the smart money goes “all in” and the scared money curls up in the fetal position on the floor and cries.

[scaredyclassic]

i dont really believe people generally are scared. Other than me. the thing I hear from ordinary people is that now is a great time to buy. People are in shock that I don’t already have a mortgage and look at me like I’mc razy for not buying immediately. I don’t even see that much negativity in the media, and that if the financing were there, people would jump on housing. I am not one to shy away from a gamble, I understand going against the flow, I’ve even sometimes made a bit of money doing just that, but i don’t think buying a house right now is going against the flow. i think people still want to flow that way. and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .

[scaredyclassic]

i dont really believe people generally are scared. Other than me. the thing I hear from ordinary people is that now is a great time to buy. People are in shock that I don’t already have a mortgage and look at me like I’mc razy for not buying immediately. I don’t even see that much negativity in the media, and that if the financing were there, people would jump on housing. I am not one to shy away from a gamble, I understand going against the flow, I’ve even sometimes made a bit of money doing just that, but i don’t think buying a house right now is going against the flow. i think people still want to flow that way. and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .

[scaredyclassic]

i dont really believe people generally are scared. Other than me. the thing I hear from ordinary people is that now is a great time to buy. People are in shock that I don’t already have a mortgage and look at me like I’mc razy for not buying immediately. I don’t even see that much negativity in the media, and that if the financing were there, people would jump on housing. I am not one to shy away from a gamble, I understand going against the flow, I’ve even sometimes made a bit of money doing just that, but i don’t think buying a house right now is going against the flow. i think people still want to flow that way. and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .

[scaredyclassic]

i dont really believe people generally are scared. Other than me. the thing I hear from ordinary people is that now is a great time to buy. People are in shock that I don’t already have a mortgage and look at me like I’mc razy for not buying immediately. I don’t even see that much negativity in the media, and that if the financing were there, people would jump on housing. I am not one to shy away from a gamble, I understand going against the flow, I’ve even sometimes made a bit of money doing just that, but i don’t think buying a house right now is going against the flow. i think people still want to flow that way. and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .

[scaredyclassic]

i dont really believe people generally are scared. Other than me. the thing I hear from ordinary people is that now is a great time to buy. People are in shock that I don’t already have a mortgage and look at me like I’mc razy for not buying immediately. I don’t even see that much negativity in the media, and that if the financing were there, people would jump on housing. I am not one to shy away from a gamble, I understand going against the flow, I’ve even sometimes made a bit of money doing just that, but i don’t think buying a house right now is going against the flow. i think people still want to flow that way. and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .

[an]

[quote=scaredycat]and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .[/quote]
Why would “immediately being underwater” limits your ability to move? Especially when you can rent out such home for a profit each month? Not only can you move, you’ll have someone else pay your mortgage as well as making you income every month. I don’t see your logic.

[an]

[quote=scaredycat]and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .[/quote]
Why would “immediately being underwater” limits your ability to move? Especially when you can rent out such home for a profit each month? Not only can you move, you’ll have someone else pay your mortgage as well as making you income every month. I don’t see your logic.

[an]

[quote=scaredycat]and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .[/quote]
Why would “immediately being underwater” limits your ability to move? Especially when you can rent out such home for a profit each month? Not only can you move, you’ll have someone else pay your mortgage as well as making you income every month. I don’t see your logic.

[an]

[quote=scaredycat]and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .[/quote]
Why would “immediately being underwater” limits your ability to move? Especially when you can rent out such home for a profit each month? Not only can you move, you’ll have someone else pay your mortgage as well as making you income every month. I don’t see your logic.

[an]

[quote=scaredycat]and i think it’s not really about buying at the bottom, it’s about not immediately being underwater because it limits the ability to move. maybe this is the time to buy, maybe this is the “blood on the streets” that signifies the time when the brave step upa dn the fearful step aside. .[/quote]
Why would “immediately being underwater” limits your ability to move? Especially when you can rent out such home for a profit each month? Not only can you move, you’ll have someone else pay your mortgage as well as making you income every month. I don’t see your logic.

[danthedart]

Historically the cost of operating a rental unit is 45%. So in order to rent out a home for a profit each month, 55% of rent needs to cover your mortgage plus taxes.

In otherwords, its very difficult for a SFR to be cash flow positive.

[danthedart]

Historically the cost of operating a rental unit is 45%. So in order to rent out a home for a profit each month, 55% of rent needs to cover your mortgage plus taxes.

In otherwords, its very difficult for a SFR to be cash flow positive.

[danthedart]

Historically the cost of operating a rental unit is 45%. So in order to rent out a home for a profit each month, 55% of rent needs to cover your mortgage plus taxes.

In otherwords, its very difficult for a SFR to be cash flow positive.

[danthedart]

Historically the cost of operating a rental unit is 45%. So in order to rent out a home for a profit each month, 55% of rent needs to cover your mortgage plus taxes.

In otherwords, its very difficult for a SFR to be cash flow positive.

[Author]

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