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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: fatty who wrote (14202)	10/7/2003 3:27:25 PM
From: Tradelite	Read Replies (1) \| Respond to of 306849

<<I'm only looking for a bottom where if you pay 20% downpayment, the rental income should be able to cover the expenses and the 30 year mortgage>> Let me know if you ever see that bottom. Investors in my area have been looking for that type of scenario for decades. Impossible to ever get positive cash flow here with only 20 percent down. Investors here have always banked on property value appreciation when they eventually sell. Meanwhile, they use the tax breaks inherent in renting out with negative cash flow. I remember having a client who wanted to sell his townhouse with owner financing. He only wanted 20 percent down, to minimize his tax liability. I couldn't talk him out of this--he believed anything he wanted was possible. Every investor who responded to my ads for those financing terms just laughed. Everyone needed to put down much more than 20 percent so negative cash flow could be minimized. The seller eventually bowed to the market and sold on terms people could actually handle.

To: fatty who wrote (14202)	10/7/2003 11:17:13 PM
From: David Jones	Read Replies (1) \| Respond to of 306849

qt....30-40% at the current price level..... One would hope so but even that's not enough. Two doors down just sold. 405k two/two that will not return more than sixteen hundred per month. Less 40% = 243k @ 7% =$1617.00 per plus 1.41 tax 475.86 per for a loss of $500 per month omitting insurance costs. It was bought my an investor group. They run in packs now. "7% estimated for non owner occupied" Last week this one got me interested enough to investigate. Only because the location appealed to me for my own residence. 685k 3/2 with studio "all needs work" could return $1950.00 plus $600.00 studio. Left as is for the most part $2550.00 per for income. Less 40% = 411k @ 7% = $2735.00 per plus 1.37 tax 782.00 per for a loss of around $967.00 omitting insurance. I could make this one work if I can get the price down 50 to 70k. Plow that plus another 30k or better into making repairs fight the zoning to add another unit "$1200.00 more income". And....