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

To: John Vosilla who wrote (282938)	10/13/2010 12:39:36 AM
From: koan	Read Replies (1) \| Respond to of 306849

Exactly what I tell my investors. They are buying multi family units with low fixed rate interest rates. And going foreward that is going to be worth a fortune. Over last 6/7 years I have sold half the multi plexes in our area. 60 agents or so. For a while "the realtors and appraisers were $100,000 low on 4 plexes. I got three from different people who didn't need to sell and we raised the price $100,000. Now they sell above that. But it was replacement value that convinced me like you say below. Land, site prep, building and interest rates. Interest rates being huge. New 4 plexes have not been built in my town in 30 years. Too costly. And I realized rents had to rise a lot before any replacement could begin. Average 4,000 sq ft 4 plexes are now about $525,000 to $550,000. Town has 30,000 people, limited vacant land, and is very rich, from mining, tourism, fishing and government. No place to expand and people flowing in as we have jobs. <<And keeping rates so low till 2015? The cash flow and IRR's over a decade are mind boggling controlling property in low priced areas with 4% fixed rate mortgages. Nirvana for creative investors... Part of what is going on in corporate America these days too... I imagine hard assets generating excellent cash flow and locked in low fixed rates will be a big winner no matter what.>>