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April 10, 2012 at 7:14 PM in reply to: Where is the inventory, where is the inventory, where is the inventory… #741423
an
ParticipantAlcoa released great earning and up >5% in AH. Will that and possibly other great earnings be enough to drive up the market through this earning season? We’ll have to wait and see I guess.
April 10, 2012 at 3:35 PM in reply to: Where is the inventory, where is the inventory, where is the inventory… #741398ParticipantBG, how do you have a FICO score that’s higher than the max of 850?
April 9, 2012 at 11:20 AM in reply to: Where is the inventory, where is the inventory, where is the inventory… #741300ParticipantWhere’s the spring inventory?
Participant[quote=flu]I think one could probably get a loan for a rental for this at 4.5%, maybe I’m wrong. Or you could end up putting 30% down. Half jokingly…since your interest rate in a savings or CD is effective 1% or lower, it doesn’t really matter in this environment,because you aren’t really going to be losing much of your principal “doing something else”… Well, maybe if you gamble in the stock market, you might have a chance for decent returns. But then if you were going to do that, you would be defeating the purpose of investing in a rental property versus higher risk class of investment.
But one thing to consider. The fact that rent does end up being more or at least break even in CV tells me why people are looking to buy. Either as a rental (with the expectation that things will cash flow in the future), or as a primary (because things already seem to pencil out as better than rent).
So unfortunately, I think at least in the short term there will be a floor on prices of attached homes in CV. I don’t see a 3/3 falling $400k or lower anything soon.[/quote]
Maybe you can get rental for 4.5%, but I’m just going by what aimloan say, and even them are saying you need a few grand in closing cost for 5%. Maybe because it’s a condo. Who knows, but 4.5% seems optimistic based on my guestimate.Although you might not be able to park your money in CD and get better return. That doesn’t mean CV condo/townhouses are a great investment either. If you want good investment in this general area, I think SFR in MM will get you MUCH better return. They’re going for mid to high $300k for a turn key place for high $200k for a fixer. Based on craigslist, the rent are also around $200k. You have no HOA or MR. So, the ROI is better.
You won’t get any objection from me that rent parity does put a floor on prices. Unless interest rate goes up, then price will go down. But I don’t think CV is cheap enough that investors are flocking to it and put that strong of a floor in.
Participantflu, the $425k-450k would be more likely than $400k. The 4%, like you said is not likely for an investment property. It’s more likely to be at least 5% for a no cost loan. So, assuming 5% and $450k, the P&I is $1932. If you add in HOA, Tax, MR, and insurance (~$750) and you have a total cost of around $2700. So, it’s not likely to be cash flowing positive, unless you can get 4% loan AND $400k price. Which, I think is unlikely.
Participant[quote=flu]I’m still waiting for the flood of bank owned homes to come on the market.[/quote]
I’m waiting for the flood as well. Maybe now that you just bought, the flood will finally come. Maybe we’ll see 2/2 condos in MM for $120k after all.April 2, 2012 at 8:04 PM in reply to: Mira Mesa – 7510 Bannister Ln – 10%+ loss in less than one year #741033Participant[quote=Wah-Wah]wow… this makes the OP’s Bannister house seems like a great deal for the new owner but we all know “pending” means nothing unless it sold :)[/quote]
Just closed for $399k (asking price). So the flipper made a decent profit.Participant[quote=pri_dk]Try “building wealth” in a place that has no taxes and see which environment is more favorable.
Of course not all taxes are a good idea, but the idea that “more government is always bad” or “more taxes are always bad” is silly.
The Constitution was written with the purpose of creating a government with the power to tax. Some people were arguing “more government is bad” back then too.[/quote]
Isn’t that a little bit of a hyperbole? No one, AFAIK, is advocating no taxes. The counter of your first sentence would be, try “building wealth” in a place that has 100% taxes and see which environment is more favorable. I’m sure you’re not advocating that either, but it’s just as useless of an argument.Also, AFAIK, no one is saying “more government is always bad” or “more taxes are always bad”. Yes, it’s silly as you say. But then, to flip that around, it’s just just as silly saying “less taxes are always bad” and “less government is always bad”.
Participant[quote=sdrealtor]Just ran some preliminary numbers. Looks like inventory is starting to fall even faster.[/quote]
It’s already the end of March and inventory is actually decreasing. Spring will be very interesting to watch. For MM, where there are 23k households and a population of 74k, there are currently only 95 SFR and 60 condos for sale. That includes contingent listings.Participant[quote=bearishgurl]It seems that members of your spouse’s family sold or left their longtime “city” houses and moved out into the sprawl when newer development became available. Therefore, they must have gotten caught up in millenium-boom buying (since that’s when the majority of these tracts were built) and are underwater now.
You’re right, AN. If you can’t beat them, join them. I guess being able to buy cheap rental houses now lessens the sting of an unwise purchase on one’s residence years ago :=]
For your spouse’s relatives’ sake, I hope all the “shadow inventory” around Fresno is able to be absorbed in the coming years (gets transferred to stronger hands).[/quote]
What “city” houses are you talking about? I did say they’ve lived there for well over 20 years. I don’t know about all of them, but the one that I do know, the answer is no, they’re not underwater, even when they bought in the bubble years (not at the peak).What do you mean if you can’t beat them? Beat what? Who are them? What sting are you referring to?
FYI, I think some of them would be ecstatic if the “shadow inventory” drive prices down even further. Lower prices = more and better cash flow rental for them.
Participant[quote=bearishgurl]So what do you think of the outgrowth of Fresno and surrounds, AN? Does it appear “sustainable” to you? Has any of your spouse’s relatives commented on how the (surrounding) distressed properties affect their own values and/or on the displacement of all the families who have lost their homes?[/quote]
I have no problem with it and neither does my family members. They actually loved it, since they get to buy new big houses. Yes, seem perfectly sustainable to me. There’s vast amount of empty land there, flat and perfectly build-able. I think it’s a waste that it’s sitting there, unused. No, they don’t comment on the surrounding distress. If you ask them, of course they’ll say they’re not happy that they “lost” value in their house. But they all bought houses well within their means, so they’re going on with their lives. They have no plan in moving, so the paper lost will be a paper gain, but it doesn’t really matter to most (if not all) of them, since they have no plan on moving for a very very long time. Those who have the cash are loving the current distressed market. They can pick up rental property at $70k and rent it out for $1k/month. They’re building a nice little portfolio for themselves. Those “displaced” family end up renting in the same area, so they’re only displaced if you consider it as not owning. But they still have a similar roof over their head. They’re just renting that roof instead of owning it.Participant[quote=bearishgurl]Of course they didn’t, AN. And I will admit that there were enough jobs in those small cities to employ their original (year 2000) populations. But you should SEE what’s built around them now! You would be SHOCKED!!
It’s evident to me here that there are not a lot of Piggs that are as well-road-traveled as I am. I can safely say I’ve traveled nearly all hwys, large and small in this entire state, some multiple times and some dozens of times.
CA is slowly losing its prized agricultural “foodbasket” to “Big Development.” This vast area is THE prime provider of food and commodities to nearly the entire country, ESP for food that cannot be grown elsewhere.
The San Joaquin Valley wasn’t meant to turn into a mcmansion megalopolis. The population and job centers to support this type of housing never existed there. It’s absolutely horrific driving through these recently-built far-flung tracts in inland counties which were and are extremely hard-hit by distressed properties primarily resulting from sub-prime lending of recent years.
You would have to see it to believe it. It’s a dirty shame – CA’s darkest secret that never should have happened.[/quote]
No, I wouldn’t be shocked. My wife grew up in Fresno and her entire extended family live there for over 20 years. So, I’m sure I know as much if not more about the San Joaquin Valley than you do. So, you might think you know about a place by driving through it, I know the place because I have family members who grew up there and are still living there. I go visit them several times a year. So yes, I’ve seen it as it changes over the last 10+ years.Participant[quote=bearishgurl]AN, if you go to the bottom of the second article, its information is derived from this piece:
http://money.cnn.com/2011/09/23/news/economy/poverty_suburbs/index.htm?iid=HP_Highlight
Click on the link above and look at CA. You will notice it is referring to exurbs and *new* “suburbs” which sprung from longtime farmland.
It’s not referring to communities such as Mira Mesa, which is actually “urban” (or “1st-tier suburban”). YOU and your “Gen-Y friends” are close to major job centers. The (CA) communities the CNN article is referring to sprung up in the last decade out of well-known agricultural areas.
These are CA’s future ghost towns, IMHO.
A property costing $400K in MM would cost only $150K – $200K in the outskirts of Stockton (for a comparable property). This is where the “poor” from both in-state and out-of-state are flocking to. They can’t fit a family of five into a 1 br condo in MM for $1200 month.[/quote]
According to Wikipedia, Fresno, Modesto, Bakersfield and Stockton are not suburb. They’re all small cities. Areas like Mira Mesa, Clairemont Mesa, Carmel Valley, etc. are suburbs. So, your definition of urban is not what average people would considered as urban.FYI, Fresno, Bakersfield, etc. did not “sprung up” in the last decade. They’ve been there for many many years. I can bet you Fresno is not going to be a ghost town.
Participant[quote=bearishgurl]I saw these two articles recently in my “First Tuesday” subscription which both suggest that far-flung suburbs and exurbs will be the “last choice” of the biggest immediate-future homebuyer-group (Gen Y).
http://firsttuesdayjournal.com/suburban-demographics-refute-city-growth/
http://firsttuesdayjournal.com/poverty-hits-home-with-suburban-poor/
The first article touches on and the second one discusses in depth the premise that these suburbs/exurbs are sought after by the poor due to lower prices to rent/buy in. In this case, affordability trumps desirability….[/quote]
I wonder how many of these people even know and hang out with Gen Y. I know MANY Gen Y, and all of them say that once they have kids, they’re moving to the burbs. even ones who are current living in downtown and Hillcrest. I ask them why, and they said school and safety. They don’t want their kids to be able walk by a bar on their way to school. It would be cool to walk by a bar on your way to work, but not cool when you kids walk by one on the way to school. These are very educated Gen Y’er who put school quality a very high priority. -
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