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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: LLCF who wrote (6222)	7/23/2001 9:49:04 PM
From: CharlieChina	Read Replies (1) \| Respond to of 74559

well, if a useless bag of purple and blue rocks in Canada sell for half price..is that a deal? Buyer beware ....

To: LLCF who wrote (6222)	7/23/2001 10:52:00 PM
From: TobagoJack	Read Replies (1) \| Respond to of 74559

Hi DAK, Wife Canadian, and I actually looked at the Canadian real estate market, and have decided to wait for bargains when available in Hawaii ... I need warm ocean. On real estate as an asset class ... the yields in North America, Japan and Hong Kong appear to aggregate between 3.5-6.5%, depending on location/class. Outlook (to me) seems to be for immediate gradual or sharp deflation, and then later, gradual or sharp inflation, via capital value or exchange rate movement, and thus requiring a higher yield, say 10%, leverage-able via debt to yield 13-15%. Issue for offshore buyer/foreign private buyer is leverage obtainable, paperwork, hassle factor, and potential deflation of rent (sticky) and/or value (less sticky). I had owned an 88-unit (yup, lucky number and all, with pool, community center, etc) complex in Sacramento area from 1991 to 1998. Purchased at 20% below replacement value, sank to 40% below replacement value, recovered, then sold. Summing up the net net f*cking net of paperwork, repairs, evictions, legal fees, taxes upon sale, etc, the whole effort generated enough cash flow to equal a few months of (then) Intel put option sales on the equity market, provided inexpensive housing to many single parent families (>60% of residents). My result was not impressive for the effort. I now have Hong Kong factory/office/warehouse space immediately outside of old HK airport, on the ocean front, bought for less than US$ 125/sqf at height of Asian Financial Crisis, rented out as a concrete shell for storage to two paying customers storing high value electronics and so there are no delays on rent, no paperwork, no troubles. The neighborhood is pretty demolished now, and building of 300,000 new city has started based on government master redevlopment plan (subway to exit right across the street) and private enterprise. I do not know anything, except that if California communism didn't work, try Hong Kong capitalism, but all in moderate quantity :0) I really do prefer paper assets, even for real estate. Pick up phone, and can run away ... to metals if necessary. Scared convoluted, after three generations of wandering the world. Chugs, Jay