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Strategies & Market Trends : Real Estate home/investment

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To: jjs_ynot who wrote (10)	9/26/1998 4:41:00 AM
From: David Jones	Read Replies (3) of 73

dave s There's easier money in papering property than building, safer too. I'm just burned and burned-out on buying bare land. I'm not licensed and for the life of me I can't tell you why not other than I'm lazy. I find my strength in knowing just my little piece of the would here. Now rehabs I suppose you mean Section 8 housing? Now it's late and I just woke up from the easy chair but doesn't HUD offer loans under K203 loans. Well I believe it's k203. Any way there interesting loans in that there is a strict auditing system and you need a facilitator to get through one. Plus you have to sale or rent to a HUD qualified buyer. But all in all interesting packages. Probably more suited to the builder\investor then a strict investor. I believe my next risk investment is going to be in the higher crime areas. Oakland Calif to be exact. There's an inner city called Emeryville and fifteen years ago it was mostly industrial but the city council got it's $hit together and allowed some different zoning and today it's a high dollar community. Converted warehouses into live/work spaces really is what started it all. It's the city PIXR is now building it's new campus in. If you'd seen it years ago you wouldn't believe it today. There's the same potential in other areas of Oakland and Alameda sense they closed the Navel station. But the crime , racial mix can lead to poor school districts. So you have to cater to a select buyer. It just interests me. But for the next 2-5 years I'm sticking to the subs. I'm sitting pretty much in an area immune to inflation but I've never seen a deflation cycle!? Next spring will tell more as to just where were headed. Maybe we'll get one more good summer regardless of the stock market. There is the problem of selling into a high market and having to enter a 1031 and turn around a buy into that same high market. But like what I'm doing now is selling the papered bare land and moving into older rentals. When you think about it so much depends on luck and having cash ready. I usually wont touch a piece of land unless it has some potential other than it's current income profile. Be it zoning, room for additional floor space/remodel or contingent to something interesting. Enough of that, what is going to happen next year? Those in the know claim next year will be good over all. Mostly basing it on interest rates and low unemployment. It sound reasonable until I set back and really think on it. If rents continue here as they are then it's expected by 2010 to triple. But wages have been static compared to cost of living the past ten years. Where are people going to get the money to pay such rents if not through inflation? Or is my market here even comparable to yours there? This is what makes me think the inner cities may be the way to go. 1% vacancy rates here and just 20 minutes west 17%. With square footage here at 150 per foot existing and there at half that or less. Outer area property here is being built with commutes running into 2 hours or more. And buying this property IMO is not smart because they continue to build right next to you at the same cost making existing property static in equity. And yet people are willing to commute because of low costs, perceived safety and positive environment for schools and the like. Well enough prattle, getting off the soap box. FWIW=0.00 Davej

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