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HLS
ParticipantBeing an absentee property owner definitely isn’t for everyone.
I suggest using a professional property manager who knows the laws and regulations, rather than a friend, relative or similar, which can only lead to major headaches.
However, I have heard about pro’s being terrible and even going broke.Having a PM is just like having an employee. Many people aren’t comfortable with this. Of course there can be headaches. Yes, it costs money.
It is hard to pick a perfect time to get in to the perfect area. Many people chase performance, just like buying last years best mutual fund.
I had a call recently about an area in Texas that they were interested in and I asked her why “that area”..
She had read an article in a magazine about THAT being the place to be…. that was sooo last year.
It’s like the people who get stock advice from Jim Cramer.
(Beyond me, but plenty of people just cannot think on their own, relying on “analysts comments” to buy and sell stocks)Another caller a few days ago told me that he bought two houses in Texas a year ago, had a terrible property manager, couldn’t rent the houses, was losing money, and they were worth less than he had paid.
As far as areas, I believe that there are literally hundreds that make sense for people with a long term horizon and realistic expectations.
If anyone is serious about out of area property ownership, below are a few ideas.
One of my “crazy” suggestions would to be within an hour of an airport that Southwest Airlines services.
I’m comfortable that they have invested a fair amount of time and money investigating before opening a station in a market. OR another similar large retailer.I know one area that wanted a Home Depot for years, but HD wouldn’t open in their market until they reached 50,000+,
and they were in the high 40,000…..
Once they reached a solid 50,000, HD opened and then Lowe’s did too, right down the street. They now have two huge Walmarts in the area too.NEW markets for Costco, Sam’s Club, Wal Marts, etc is like getting free top notch market analysis.
Of course it’s nice to know sooner rather than later. Conversations with a local commercial property agent can yield lots of information. Ask pointed questions about what you want to know, and listen to the answers. It’s a wealth of information.Another great spot is a local coffee shop with old timers who are the regulars. You don’t need to be a genius to walk in to the joint and see who they are. They KNOW what’s going on around town.
I wouldn’t be looking for information at the local tavern or from the young well dressed guy/gal who is driving a BMW.
(I’m probably looking for a guy that drives an OLD beat up truck)I’d say that you need to visit and see the area. It’s not hard to see growth, even if you’ve never been there before.
Many areas just have a good feel to them, while some areas are just depressing. Like looking for your first house, the more you see, the more you will know what you like and what you don’t.A guy recently told me that he has made hundreds of thousands of dollars owning homes out of state that he has never seen. I suppose it’s possible, but not something that I would recommend.
Middle of nowhere might offer a cheap property on 10 acres, but with a local population of 300, it can be hard to find tenants. If the area isn’t growing, you might be able to make money, but it’s going to be a struggle.
I’ve recently looked at parts of Utah and Ohio that are just dead, very little happening there. Other parts look very interesting, and not always “in town”.
Newer suburb areas often offer strong growth potential.A great website for loads of details on ANY city, large or small is http://www.city-data.com
ParticipantBeing an absentee property owner definitely isn’t for everyone.
I suggest using a professional property manager who knows the laws and regulations, rather than a friend, relative or similar, which can only lead to major headaches.
However, I have heard about pro’s being terrible and even going broke.Having a PM is just like having an employee. Many people aren’t comfortable with this. Of course there can be headaches. Yes, it costs money.
It is hard to pick a perfect time to get in to the perfect area. Many people chase performance, just like buying last years best mutual fund.
I had a call recently about an area in Texas that they were interested in and I asked her why “that area”..
She had read an article in a magazine about THAT being the place to be…. that was sooo last year.
It’s like the people who get stock advice from Jim Cramer.
(Beyond me, but plenty of people just cannot think on their own, relying on “analysts comments” to buy and sell stocks)Another caller a few days ago told me that he bought two houses in Texas a year ago, had a terrible property manager, couldn’t rent the houses, was losing money, and they were worth less than he had paid.
As far as areas, I believe that there are literally hundreds that make sense for people with a long term horizon and realistic expectations.
If anyone is serious about out of area property ownership, below are a few ideas.
One of my “crazy” suggestions would to be within an hour of an airport that Southwest Airlines services.
I’m comfortable that they have invested a fair amount of time and money investigating before opening a station in a market. OR another similar large retailer.I know one area that wanted a Home Depot for years, but HD wouldn’t open in their market until they reached 50,000+,
and they were in the high 40,000…..
Once they reached a solid 50,000, HD opened and then Lowe’s did too, right down the street. They now have two huge Walmarts in the area too.NEW markets for Costco, Sam’s Club, Wal Marts, etc is like getting free top notch market analysis.
Of course it’s nice to know sooner rather than later. Conversations with a local commercial property agent can yield lots of information. Ask pointed questions about what you want to know, and listen to the answers. It’s a wealth of information.Another great spot is a local coffee shop with old timers who are the regulars. You don’t need to be a genius to walk in to the joint and see who they are. They KNOW what’s going on around town.
I wouldn’t be looking for information at the local tavern or from the young well dressed guy/gal who is driving a BMW.
(I’m probably looking for a guy that drives an OLD beat up truck)I’d say that you need to visit and see the area. It’s not hard to see growth, even if you’ve never been there before.
Many areas just have a good feel to them, while some areas are just depressing. Like looking for your first house, the more you see, the more you will know what you like and what you don’t.A guy recently told me that he has made hundreds of thousands of dollars owning homes out of state that he has never seen. I suppose it’s possible, but not something that I would recommend.
Middle of nowhere might offer a cheap property on 10 acres, but with a local population of 300, it can be hard to find tenants. If the area isn’t growing, you might be able to make money, but it’s going to be a struggle.
I’ve recently looked at parts of Utah and Ohio that are just dead, very little happening there. Other parts look very interesting, and not always “in town”.
Newer suburb areas often offer strong growth potential.A great website for loads of details on ANY city, large or small is http://www.city-data.com
ParticipantMy money would be on rental property in slow and steady growth areas around the country that have never seen a boom.
You cannot expect crazy appreciation in these markets, but you can buy rental property that will cash flow nicely and provide depreciation at a much greater benefit than So Cal due to the dwelling value (vs the land)
With 25% down payment, a 5% appreciation rate offers a 20% (gross)return on investment, even if it’s a break even on cash flow.
There are many parts of the country that offer affordable units.
There is always a risk, but I’d be happier in rentals than in stocks for the long term.The stock market is nothing more than gambling and a legalized pyramid scheme, with winners and losers.
ParticipantMy money would be on rental property in slow and steady growth areas around the country that have never seen a boom.
You cannot expect crazy appreciation in these markets, but you can buy rental property that will cash flow nicely and provide depreciation at a much greater benefit than So Cal due to the dwelling value (vs the land)
With 25% down payment, a 5% appreciation rate offers a 20% (gross)return on investment, even if it’s a break even on cash flow.
There are many parts of the country that offer affordable units.
There is always a risk, but I’d be happier in rentals than in stocks for the long term.The stock market is nothing more than gambling and a legalized pyramid scheme, with winners and losers.
ParticipantRegarding REFI’s of MLS listed,,,
I don’t know of any lender that will approve a loan while listed on MLS.
If dealing with a “Rate & Term” refi, (no cash out) it might be possible to get an approval or exception depending on LTV and the strength of a borrower, as soon as it is off MLS.
If wanting a “cash out” refi, it can be 6 to 12 months off of MLS for a loan approval.
The obvious reason is someone who says heck I can’t sell it, let me get some cash out and the lender can have it..
Guidelines are constantly changing, but the above hasn’t changed much.
ParticipantRegarding REFI’s of MLS listed,,,
I don’t know of any lender that will approve a loan while listed on MLS.
If dealing with a “Rate & Term” refi, (no cash out) it might be possible to get an approval or exception depending on LTV and the strength of a borrower, as soon as it is off MLS.
If wanting a “cash out” refi, it can be 6 to 12 months off of MLS for a loan approval.
The obvious reason is someone who says heck I can’t sell it, let me get some cash out and the lender can have it..
Guidelines are constantly changing, but the above hasn’t changed much.
ParticipantIN DEBT WE TRUST
Emmy Award winner Danny Schechter’s ‘In Debt We Trust’ explores the relationship between Congress and the credit complex and how it is having an enormously negative impact on the country’s financial health.ParticipantNIC,,,
Find out how long the guy gets and just sell and move before his parole date. Nothing to worry about. !!Life in San Diego is a risk…
Even people in La Jolla have faults…But never forget..the weather is ALWAYS good, and EVERYONE wants to live here…
I wouldn’t worry about anybody coming back for anything.
The drugs will affect their brain and they will have forgotten where they lived.ParticipantJust make sure that nothing is hidden that somebody would want to come back for, even after 10 or 20 years in the pen !!
ParticipantCheck every drain and behind every wall outlet too ;-0
ParticipantI don’t think that there are many institutions that hold these loans. They were sliced and diced into CDO, MBS and sold off on Wall Street to anyone and fund managers that were looking for higher returns.
Is addition rates aren’t 3%. A prime borrower might have been 4-5%, a sub could be 6-8%.. Still not that bad of a return.
There is very little cash value to these today, so they just don’t value them. It’s better to keep it hush hush and get interest payments, with the true lack of value buried.
There are pension managers, life insurance companies, hedge fund managers, city and county treasurers that sre very concerned these days. Some will be out of a job as soon as their losses are exposed.
A bank money market account that is NOT FDIC insured could also have exposure. You own “shares”
Nobody really knows how much is out there, but it will make Enron look like child’s play.
Some of the losses will be buried forever and never get exposed.
The Wall Street folks already took their cut off the top.
Participant…but if it did happen, it’s a huge windfall to the borrower.
AND the sad thing is that we here realize that, but many of the clueless that have these loans are expecting/hoping to get bailed out, like they are entitled to be saved…
It’s a disgrace, but not a surprise.
With all the chopped up tranches, an investor that was expecting a higher return will be told you can get less OR you can get nothing.
It’s a way to keep the borrower in debt for an overinflated stucco box, which will still decline in value.
People will still owe 50% more than the property is worth.
October 5, 2007 at 12:03 PM in reply to: Mortgage Bonds 200-day Moving Avg? Can someone pls explain. #87067ParticipantIf you don’t have a rate already locked, the 30 YR fixed conforming market moved against you today.
I’m curious, exactly how are you shopping mortgage rates ?
What type of loan are you looking for ?
Qualifying depends on your credit scores, loan amount, down payment, employment situation, reserves, credit history, monthly debts, financial reserves, etc.
Also whether you are going to pay to buy the rate down and how long you plan to be in the loan.
ParticipantCW liquid rate was 5.40% a few months ago, it’s gone up.
IF you have faith in FDIC, it doesn’t matter who makes you nervous.
There is a benefit to an institution regarding their reserves level that they get from a 12 month CD, which is why 12 month pays higher than anything longer.
They are still paying 5.65% on accounts with $250K+
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