[jficquette]

Europe is one basket case for sure.

John

[jficquette]

So now your kids are obnoxious Ohio State fans? You should have moved to Alabama then you could have become Crimson Tide fans, just like me! LOL

John

[jficquette]

The problem with the tax is that the tax bill will hit all at once when you sell the property while the tax benefit was gained prorata over the years.

Also consider that with $50 Trillion in unfunded SS liabilities the risk is that the tax rates will be higher in 20 years then lower.

John

[jficquette]

I don’t have any experience renting houses so I am not really a good person to follow on this. However, I did build houses once and I passed the CPA exam years ago.

Having said that, consider the $2k in rent. That will be about $18k a year less upkeep. Forget upkeep. Why invest $300k for $18k a year when you can get $15k buying CD’s?

Forget apperication. There will not be any for years. Forget the tax benefit because it reduces your basis in the property and you will pay the tax back when you sell unless you do some tax free exchange deal which I don’t understand enough too explain. The tax free exchange stuff only postpones it anyway. I don’t think you can get out of recapturing the depreciation.

John

[jficquette]

If you were to pay cash for a 300k Condo to rent then consider that you could make $15k a year just taking that money and putting it in CD’s.

If $15k is risk free then lets say $30k is min you should make.

Take the $30k and add property taxes, say $4k per year, upkeep, say $2k per year. That means you would have to get $36k per year in rental income. Consider that you will only have it rented for 9 months per year on average then you will need to rent it for $36k/9 or $4k per month. No way you can rent it for that much. For a condo to pay off then you should only pay about $150k for it.

I didn’t include deperication because that has to be recaptured when you sell it so its just a timing issue. Not a real benefit.

When Real Estate returns to what it was in 2000 then I will get interested.

John

[jficquette]

With $50+ Trillion in unfunded Social Security obligations out there we are all ready serfs.

John

[jficquette]

Barriers to entry in homebuilding are low in Atlanta. All you have to do to build a spec house is buy the lot, take the plans down to the county, get a permit and build.

Because the process is so simple and because land is relatively cheap there are several thousand small builders in the area who all build a few houses. In addition, the large builders are there too.

In short, Atlanta just overbuilt. It does it every 15-20 years or so. It overbuild in the late 1980’s, and once before in the early 70’s.

John

[jficquette]

I grew up in Alabama but lived 15 years in Atlanta where I had built a business and sold it in 1998 and moved here.

After 8 years of during little I decided to go back to Atlanta and concentrate on building another business.

Atlanta is a true boom city. They say 150k people are moving there each year. The area has about 5.5mil people in it.

My business was placing accountants in jobs, staffing firm. And I knew Atlanta has a much better business climate there with all the companies moving in and workers too.

But sometimes all the logical things don’t matter when your heart is not in it so after the year’s lease was up we moved back. I am going to do my business here.

I didn’t have a negative experience other then after living here for 8 years you don’t realize how much of this life out here is taken for granted. It was just a shock going from here back to a big, hot, super busy, southern city.

California has a lot of problems but weather, natural beauty, Ocean, Mountains and good people are not part of them.

John

[jficquette]

I moved here to San Diego in 1998 and left August 2006 to return to Atlanta. I just moved back. I am never leaving again. I don’t care that the cost of living is so high here. It’s worth it.

John

[jficquette]

The land is much cheaper because their is so much of it. Also zoning laws are much simpler and less convoluted. Also they have a lot of small builders.

John

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