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spdrun
Participant(1) Yep, NJ is judicial. Process takes 3-4 years on average vs 1-2 years in CA, which why it’s where CA was two years ago.
(2) Some of the houses/condos are in decent school districts, others are not. Upset (aka reserve) prices run the gamut from decent to crappy. 90% of the stuff went back to the bank to become REOs.
(3) Older isn’t necessarily considered bad on this coast.
(4) The irony of the thing is that I’m actually seeing BETTER deals on rental property in the “good” towns in NJ. Yeah, you’ll pay at least $300k for a duplex, but you can rent it at 8% cap to decent tenants, and no rent control in the wealthier towns either. I’m not even talking about foreclosures, just people who buy and sell organically at what they consider to be a fair price.Participant“The NAR was the main lobby behind the ouster of DeMarco. With so many “would-be sellers” living “free” while waiting months for a (dicey) SS approval or to be foreclosed upon (with both possibly occurring simultaneously or in-tandem), they’re not listing because they are underwater …. hundreds of thousands of them grossly so.”
Even if a loan gets modified, they’d still be underwater. As far as I know, even after a mod, people can’t sell at the new loan amount — they need to basically do a short sale. This would just make more people sit tight, not less.
In other news, I was at the Morris County (NJ) sheriff’s auction this week. 25 homes went under the hammer with few bidders; a few months ago it was maybe four or five per week. *BANG* *BANG* Going once … SOLD! Should be some interesting grist for the mill as the REOs get offered through the fall and winter of 2013.
Good thing is that:
(a) the stooge may not be confirmed, and this will take a few months
(b) changing FNMA’s charter will take time as well
(c) hopefully I’ll have enough rental property not to give a fuck by the time the bums get a free pass.ParticipantAre you planning to sell in the next year? If not, who gives a damn? Excess energy usage from incandescent globe lights is minimal since (a) the bathroom can generally use extra heat and (b) bathroom lights aren’t on all that much.
If you’re not selling, wait and see what the style of the week will be when you do sell.
ParticipantMake a dozen offers and hope one sticks? Sort of the real-estate equivalent of spam. Eventually, you’ll find SOMEONE interested in teh c1aLi5 and v1a6ra that you’re peddling.
Other than that, ain’t over till it’s over. Everything seems to be moving at a glacial pace — fortunately, the bank’s deadline for closing is two months out. (Though I hope to do much sooner.)
California’s system of doing most things by mail is also very different from NJ/NY, where you have a closing day involving a bunch of dudes and attorneys sitting around a table, signing shite, and where they give you the HOA docs FOR FREE upon offer acceptance, rather than having to pay the management $300 to wait 5 days, then make a few clicks and e-mail them.
April 27, 2013 at 5:09 PM in reply to: Short sale update: entered investor approval stage. Time table? #761699ParticipantBy “investor”, I meant the bank buying the loan as opposed to the servicer. Not the current “owner/renter” of the property.
Anyway, I was approved a few days ago 🙂
ParticipantD/k – I prefer a roll of bills “wiseguy” style.
ParticipantHow so?
Other than rent being about 2x psf that of San Diego(*) (I have that problem basically licked at this point), it’s not materially more expensive unless you SEEK OUT expensive activities. e.g. Want to get ripped off? Go to a famous nightclub with the rest of the tourists and bridge/tunnel crowd.
Plenty of free stuff to do as well, much more than 99% of other US cities.
(*) – you can rent a 450 sf 1-br in a nice part of NYC for $1800/mo, or you can rent an 900 sf 2-br in a nice part of San Diego for about the same price.
ParticipantEarnest deposit has to be received (mailing it) since they only had a fax of a check before. Probably will be cashed on Mon or Tues, therefore. Regardless, I have a bank letter agreeing to the sale, close by mid-June, but I’ll attempt to do so by early May.
I’m not sure if I agree with your analysis of prices:
(a) inventory is very low. This situation may not remain as more sales come online, and also as banks “learn” to deal with the Homeowners’ Bill of Rights and move forward with foreclosures. This is a VERY unusual situation, and I doubt it will last for a long time. This isn’t a bubble. This is a Mexican standoff. The small amount of foreclosures and shorts are basically going by random bizarro lottery. Everything else is just being bid up by people in a frenzy, and it behooves me to exploit that.
(b) if the economy improves, prices in my area (NYC and NJ) will also spike. Right now, they’re close to bottom. I could just take a quick gain, pay tax, put what remains into a market that’s where SD was two years ago. No shame in that. And ultimately, I’m a die-hard New Yorker at heart. (*)
(c) I’m not convinced the economy will actually improve in the next year, beyond the level that it already has. Employment/participation numbers are nasty nationally. PMI is dropping. Hell, we may be in the paradoxical situation of a stock/specific RE market bubble while coming into a recession.
(d) Not sure if I want to hold a non-owner-occupied condo where I’m too far away to be on the board long-term. Too much risk of assessments, rises in common charges. Ultimately, the goal might be to do a few flips and end up with a mixed-use building in a very specific upper-middle-class town in NJ. Property taxes there are similar to San Diego (1.2-1.3% of assessment per annum) and are discouraged from rising by new laws. Cap rates are right bang at 8%.(*) – always love coming into LaGuardia in evening — tour of the city from 10,000 ft never gets old. Last time I came back from SD, I came back to a rockin’ impromptu street party outside the 125th St. train station and an amazing jazzman playing. Totally random, and you don’t get that sort of randomness in SD. Maybe in SF or parts of LA — most people in SD would probably see this as “ghetto” though.
ParticipantDon’t some banks have the right to put a 90-day anti-flip clause in the deed? (Not that I’ve seen anything like that in what I signed thus far.)
ParticipantOr sit on it for the waiting period, then put it on the market. With the way the market rocketed up (and my local market hasn’t so far), this might be a decent option.
ParticipantI’m not cut out to be a full-time 8-6’er, so that’s what I HAVE to do to survive, pretty much.
ParticipantBasically, the advice is:
“Wait until you’re an old fart who can no longer enjoy much to have income from property, instead of horse-trading your way to $50-100k/yr extra by the time you’re 35 or 40.”While I love my work, I have no interest in HAVING to work long-term for basic necessities.
ParticipantAlso, keep in mind, his cap rate is actually determined by what he paid when he bought it, not what he thinks he can get for it today.
No: it’s determined by current value, since there’s such a thing as opportunity cost. Assuming all-cash for the sake of the argument. You bought a house for $150k that’s capping at 8% based on $150k right now, but is actually worth $300k at this point. Income: $12k.
Sell for $300k, buy something else for $280k (less $20k for expenses incurred in the deal). The new one caps out at 8%. Income: $22k.
Look at INCOME POTENTIAL, not cap rate based on sale price 15 years ago!
Participant“Slum” in this case means a working-class/industrial area of one of the wealthier and better-run small cities in NJ. I mean literally working-class, not welfare class. There’s a bakery that sells bread to many of the local groceries, a bunch of small shops, an old-school Italian restaurant, an auto repair place, a plumbing and electrical supplier and jobber. Many of the employees of the same live locally, within a few blocks. Ironically, there are no vacant shops in that area and haven’t been in years, unlike the main (considered nicer?) downtown drag that has eight or nine storefronts sitting vacant at any one time and bad turnover.
Think “older part of Chula-Vista” rather than “Watts or South Central.” Walking distance to very good schools, fast trains to NYC, the whole 9 years.
That area: 8% cap rate, no problem finding great tenants. Basically, if I’m smart about it, a building like that would pay my rent in Manhattan.
Manhattan: 4% cap rate (or owner equivalent rent) -
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