Do RE Investors have enough NEWS?
- Thread starter selansa
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Selansa:Too much news can simply muddy the waters.
The information you need, in order is:
1) What are your investment goals?
2) Proper Education: I can symbolize this in 2 documents: (1) Property Goldmine Scorecard, (2) Property Analyzer form. More to it than that, but that is the essence.
3) What is my current financial situation, and how does my financial situation "jive" with #1 and #2 (particularly #1).
4) Personality type; can you properly assess risk and handle good times and bad times with an even keel? Maybe this should be #1
Lots/many/majority of REIN members are interested in the news (me included).
BUT, how much the news affects us depends on all the factors above and whether they bought fundamentally strong properties with cash flow (or not) and how well managed the properties are.
And other REIN members are definitely looking at buying right now, because depressed prices means (1) more choices in properties without potential buyers going nuts (2) ergo better pricing (3) ergo more positive cash flow immediately (4) ergo more room for better equity appreciation in the future. I think the old truism applies; "you make your profits on the purchase!"
Bottom line is that there are opportunities and sophisticated investors don`t sit on the sidelines just because of a challenging world, national, provincial, or local economic issues that get constantly reported on in the news. They focus, specialize, and dig down to find hidden gems.
Hope that helps,
Smitty
The information you need, in order is:
1) What are your investment goals?
2) Proper Education: I can symbolize this in 2 documents: (1) Property Goldmine Scorecard, (2) Property Analyzer form. More to it than that, but that is the essence.
3) What is my current financial situation, and how does my financial situation "jive" with #1 and #2 (particularly #1).
4) Personality type; can you properly assess risk and handle good times and bad times with an even keel? Maybe this should be #1
Lots/many/majority of REIN members are interested in the news (me included).
BUT, how much the news affects us depends on all the factors above and whether they bought fundamentally strong properties with cash flow (or not) and how well managed the properties are.
And other REIN members are definitely looking at buying right now, because depressed prices means (1) more choices in properties without potential buyers going nuts (2) ergo better pricing (3) ergo more positive cash flow immediately (4) ergo more room for better equity appreciation in the future. I think the old truism applies; "you make your profits on the purchase!"
Bottom line is that there are opportunities and sophisticated investors don`t sit on the sidelines just because of a challenging world, national, provincial, or local economic issues that get constantly reported on in the news. They focus, specialize, and dig down to find hidden gems.
Hope that helps,
Smitty
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It`s a Good question Selansa!
Keep in mind that even when exposed to the same information/situation, different people respond differently. Therefore, the bottom line decision to buy or not to buy depends mainly on the personality of the person and also on his/her skills, experience and knowledge.
Therefore, do not expect one answer. Also, understanding the above, remember it is NOT a "good idea to buy now" NOR a "bad one" because saying that is like saying blue is better than green. Just having more skills, for example, is a good thing but since a buying decision is also a function of personality we can not objectively say it is good to buy. interesting, eh
Regards,
Neil
Keep in mind that even when exposed to the same information/situation, different people respond differently. Therefore, the bottom line decision to buy or not to buy depends mainly on the personality of the person and also on his/her skills, experience and knowledge.
Therefore, do not expect one answer. Also, understanding the above, remember it is NOT a "good idea to buy now" NOR a "bad one" because saying that is like saying blue is better than green. Just having more skills, for example, is a good thing but since a buying decision is also a function of personality we can not objectively say it is good to buy. interesting, eh
Regards,
Neil
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Any time is a good time to buy real estate ! More news is better than less news !
Any real estate is good real estate AT THE RIGHT PRICE.
The only questions are: where to buy, what kind of asset class to buy, how big an asset to buy, what to pay for it, how to manage it, is it in line with your short-, medium- or long-term goals, who is managing it impeccably, what kind of financing can you get ?
Any real estate is good real estate AT THE RIGHT PRICE.
The only questions are: where to buy, what kind of asset class to buy, how big an asset to buy, what to pay for it, how to manage it, is it in line with your short-, medium- or long-term goals, who is managing it impeccably, what kind of financing can you get ?
Some real estate investors are true veterans who have spent many years in the business and can make fairly quick assessments if a deal is a deal.
For the less experienced, its a process of gathering info and then using this info to make a decision based on facts/fundamentals.
Iv`e read so many posts where members say I`m buying! in such a way like they are out there on the road with a briefcase and buying a different property almost daily. If you read Don`d book Real Estate Investing in Canada, he talks about the 4 seasons. One of the seasons is where its time to sell.
I like the way he describes it by breaking it down by seasons, but how do you know what season it is? For some, this recession suggests we should have sold a year ago, and now many people have missed the boat. What if you were a senior who`s plan was to sell when they reached a certain age and then enjoy their retirement. Selling now would be horrible for them. Others will say, why would you sell? If your property is producing positive cash flow, etc...then why would you sell? So it comes down to your plan...do you want to buy and hold for 1 year, 5 years, or more? Are you banking on the idea that your purchase will appreciate in value by 20% in 5 years and want to sell then? Do you want to buy property that you will hold onto for many years...like over 10 years or more...
The seasons do play a part. It took a while for me to understand why most agressive investors who post here keep commenting on buying... I rarely see anyone say they are selling.
I personally want to buy properties with the intention of holding. I don`t based my decision to buy on a property appreciating by a certain % in a given amount of time....there is no guarantee this will happen. My intention is to buy a property that I WILL keep.
This way, if the property does appreciate, thats a bonus IMO.
The truth is...when times are tough, you MAY need to reduce your rents. Iv`e seen members make that comment more than once...so if that`s the case, then you should be prepared for the bad times. Overleveraging could end up hurting.
In other words, my preference is to buy a property without over leveraging, to minimize my and the banks risk. That means that I can`t buy as many properties as I`d like to, as fast as I want to. But that`s ok, because the ones I do have don`t not pose a big risk to me.
I don`t have deep pockets and if I were to play it risky, I only have myself to blame.
Besides, its like everyone says, wealth in real estate is achieved long term, not short term.
For the less experienced, its a process of gathering info and then using this info to make a decision based on facts/fundamentals.
Iv`e read so many posts where members say I`m buying! in such a way like they are out there on the road with a briefcase and buying a different property almost daily. If you read Don`d book Real Estate Investing in Canada, he talks about the 4 seasons. One of the seasons is where its time to sell.
I like the way he describes it by breaking it down by seasons, but how do you know what season it is? For some, this recession suggests we should have sold a year ago, and now many people have missed the boat. What if you were a senior who`s plan was to sell when they reached a certain age and then enjoy their retirement. Selling now would be horrible for them. Others will say, why would you sell? If your property is producing positive cash flow, etc...then why would you sell? So it comes down to your plan...do you want to buy and hold for 1 year, 5 years, or more? Are you banking on the idea that your purchase will appreciate in value by 20% in 5 years and want to sell then? Do you want to buy property that you will hold onto for many years...like over 10 years or more...
The seasons do play a part. It took a while for me to understand why most agressive investors who post here keep commenting on buying... I rarely see anyone say they are selling.
I personally want to buy properties with the intention of holding. I don`t based my decision to buy on a property appreciating by a certain % in a given amount of time....there is no guarantee this will happen. My intention is to buy a property that I WILL keep.
This way, if the property does appreciate, thats a bonus IMO.
The truth is...when times are tough, you MAY need to reduce your rents. Iv`e seen members make that comment more than once...so if that`s the case, then you should be prepared for the bad times. Overleveraging could end up hurting.
In other words, my preference is to buy a property without over leveraging, to minimize my and the banks risk. That means that I can`t buy as many properties as I`d like to, as fast as I want to. But that`s ok, because the ones I do have don`t not pose a big risk to me.
I don`t have deep pockets and if I were to play it risky, I only have myself to blame.
Besides, its like everyone says, wealth in real estate is achieved long term, not short term.
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Thomas, I don`t think "Any time is a good time to buy real estate" for everyone. For us yes, NOT FOR EVERYONE. If you read my response above, it also truly depends on the personality of the individual.
There is no doubt buying for the "right" price is the right thing to do for you, me and many investors here. However, millions of people in the world who currently do not invest in real estate would get a heart attack if they had to buy, manage or own properties. Yes, even positive cash flow ones. There is a reason why billions of people do NOT invest in real estate beside understanding fundamentals, property analysis and numbers. One of the main reasons is their personality does not fit. It`s Great you and others explain why the fundamentals are there, providing objective analysis, etc. highly appreciated by investors. It`s the portion that is related to the personality of the individual that in my opinion we should save our energy and not try to change. Cheers.
There is no doubt buying for the "right" price is the right thing to do for you, me and many investors here. However, millions of people in the world who currently do not invest in real estate would get a heart attack if they had to buy, manage or own properties. Yes, even positive cash flow ones. There is a reason why billions of people do NOT invest in real estate beside understanding fundamentals, property analysis and numbers. One of the main reasons is their personality does not fit. It`s Great you and others explain why the fundamentals are there, providing objective analysis, etc. highly appreciated by investors. It`s the portion that is related to the personality of the individual that in my opinion we should save our energy and not try to change. Cheers.
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QUOTE (investmart @ Jan 14 2009, 06:16 PM) Thomas, I don`t think "Any time is a good time to buy real estate" for everyone. For us yes, NOT FOR EVERYONE. If you read my response above, it also truly depends on the personality of the individual.
There is no doubt buying for the "right" price is the right thing to do for you, me and many investors here. However, millions of people in the world who currently do not invest in real estate would get a heart attack if they had to buy, manage or own properties. Yes, even positive cash flow ones. There is a reason why billions of people do NOT invest in real estate beside understanding fundamentals, property analysis and numbers. One of the main reasons is their personality does not fit. It`s Great you and others explain why the fundamentals are there, providing objective analysis, etc. highly appreciated by investors. It`s the portion that is related to the personality of the individual that in my opinion we should save our energy and not try to change. Cheers.
I grew up in Europe .. some houses/buildings are 400+ years old .. I was in Rome this May .. some buildings are over 2000 years old !!
People come and go .. civilizations rise and fall .. recessions is followed by growth .. when is NOT a good time to buy real estate ?
The ONLY issue to me as they relate to real estate is price .. so $400,000 ? $45,000 ? $3200 ? and yes, sometimes even $1 is overpriced .. but if I owned contaminated raw land in a crappy neigbourhood and gave you a million $s for it .. perhaps then it is the right price ..
Owning and managing are two different issues also !
The owner does not have to manager .. he can hire someone. That is a personal preference.
Of course, certain individuals should not own real estate (but do), similar to the fact that some folks should be in jail (but are not), should not be parents (but are), should not be a CEO of a public company (but are) or should not drive a car (but do) .. so let`s differentiate people skills from monetary issues from locations, prices and classes of real estate.
There is no doubt buying for the "right" price is the right thing to do for you, me and many investors here. However, millions of people in the world who currently do not invest in real estate would get a heart attack if they had to buy, manage or own properties. Yes, even positive cash flow ones. There is a reason why billions of people do NOT invest in real estate beside understanding fundamentals, property analysis and numbers. One of the main reasons is their personality does not fit. It`s Great you and others explain why the fundamentals are there, providing objective analysis, etc. highly appreciated by investors. It`s the portion that is related to the personality of the individual that in my opinion we should save our energy and not try to change. Cheers.
I grew up in Europe .. some houses/buildings are 400+ years old .. I was in Rome this May .. some buildings are over 2000 years old !!
People come and go .. civilizations rise and fall .. recessions is followed by growth .. when is NOT a good time to buy real estate ?
The ONLY issue to me as they relate to real estate is price .. so $400,000 ? $45,000 ? $3200 ? and yes, sometimes even $1 is overpriced .. but if I owned contaminated raw land in a crappy neigbourhood and gave you a million $s for it .. perhaps then it is the right price ..
Owning and managing are two different issues also !
The owner does not have to manager .. he can hire someone. That is a personal preference.
Of course, certain individuals should not own real estate (but do), similar to the fact that some folks should be in jail (but are not), should not be parents (but are), should not be a CEO of a public company (but are) or should not drive a car (but do) .. so let`s differentiate people skills from monetary issues from locations, prices and classes of real estate.
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QUOTE (thomasbeyer2000 @ Jan 14 2009, 12:55 PM) Any time is a good time to buy real estate ! More news is better than less news !
Any real est.
Well, I guess thats where a persons risk tolerance comes to bare. I stopped buying in mid 2006 since I did not like the Reral Estate climate. I don`t feel comfortable in skyrockiting prices. I also don`t buy in a downtrend. I like to see prices level off.These are some of my rules for controlling risk. Agree or disagree , when my conditions come about I will pull the triger and buy. The thing is I know when I will buy I don`t really need a whack of daily headlines.
Any real est.
Well, I guess thats where a persons risk tolerance comes to bare. I stopped buying in mid 2006 since I did not like the Reral Estate climate. I don`t feel comfortable in skyrockiting prices. I also don`t buy in a downtrend. I like to see prices level off.These are some of my rules for controlling risk. Agree or disagree , when my conditions come about I will pull the triger and buy. The thing is I know when I will buy I don`t really need a whack of daily headlines.
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QUOTE (mcgregok @ Jan 14 2009, 08:02 PM) Well, I guess thats where a persons risk tolerance comes to bare. I stopped buying in mid 2006 since I did not like the Reral Estate climate. I don`t feel comfortable in skyrockiting prices. I also don`t buy in a downtrend.
Why not ? At the right price, of course.
So if prices were $400,000, and have fallen to $350,000 and will likely fall to $300,000 .. but you can buy for $225,000 and cash-flow it .. why not buy then ?
Price is the overall adjudicator for issues like: crappy neighborhood, crappy city, up or down market, bad economy, caved in roof, missing boiler, no windows, drugs sold next door ... of course some neighborhoods are very rough and scare the living daylights out of me .. but would I buy a house for $1 in a certain city .. why not ?
Of course, given that $s are usually scarce, and you have 5 choices for a location then maybe (only maybe though) you should buy in the best location with the best upside .. but buying in West-Vancouver for $1,400,000 is not necessarily better than buying 10 houses in East-Vancouver for $140,000 each as they could each be potentially sold after some rehab for $300,000 for a $1,200,000 profit whereas the West-Van house will not yield that kind of upside in 3 months !
Why not ? At the right price, of course.
So if prices were $400,000, and have fallen to $350,000 and will likely fall to $300,000 .. but you can buy for $225,000 and cash-flow it .. why not buy then ?
Price is the overall adjudicator for issues like: crappy neighborhood, crappy city, up or down market, bad economy, caved in roof, missing boiler, no windows, drugs sold next door ... of course some neighborhoods are very rough and scare the living daylights out of me .. but would I buy a house for $1 in a certain city .. why not ?
Of course, given that $s are usually scarce, and you have 5 choices for a location then maybe (only maybe though) you should buy in the best location with the best upside .. but buying in West-Vancouver for $1,400,000 is not necessarily better than buying 10 houses in East-Vancouver for $140,000 each as they could each be potentially sold after some rehab for $300,000 for a $1,200,000 profit whereas the West-Van house will not yield that kind of upside in 3 months !
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QUOTE (thomasbeyer2000 @ Jan 14 2009, 08:37 PM) Why not ? At the right price, of course.
So if prices were $400,000, and have fallen to $350,000 and will likely fall to $300,000 .. but you can buy for $225,000 and cash-flow it .. why not buy then ?
Price is the overall adjudicator for issues like: crappy neighborhood, crappy city, up or down market, bad economy, caved in roof, missing boiler, no windows, drugs sold next door ... of course some neighborhoods are very rough and scare the living daylights out of me .. but would I buy a house for $1 in a certain city .. why not ?
Of course, given that $s are usually scarce, and you have 5 choices for a location then maybe (only maybe though) you should buy in the best location with the best upside .. but buying in West-Vancouver for $1,400,000 is not necessarily better than buying 10 houses in East-Vancouver for $140,000 each as they could each be potentially sold after some rehab for $300,000 for a $1,200,000 profit whereas the West-Van house will not yield that kind of upside in 3 months !
Radical cheap: $1,000 homes
In places like Detroit and Cleveland, banks are unloading rundown homes for next to nothing. And they`re tremendous bargains, even after factoring in renovation costs.
http://tinyurl.com/9k9vkn
So if prices were $400,000, and have fallen to $350,000 and will likely fall to $300,000 .. but you can buy for $225,000 and cash-flow it .. why not buy then ?
Price is the overall adjudicator for issues like: crappy neighborhood, crappy city, up or down market, bad economy, caved in roof, missing boiler, no windows, drugs sold next door ... of course some neighborhoods are very rough and scare the living daylights out of me .. but would I buy a house for $1 in a certain city .. why not ?
Of course, given that $s are usually scarce, and you have 5 choices for a location then maybe (only maybe though) you should buy in the best location with the best upside .. but buying in West-Vancouver for $1,400,000 is not necessarily better than buying 10 houses in East-Vancouver for $140,000 each as they could each be potentially sold after some rehab for $300,000 for a $1,200,000 profit whereas the West-Van house will not yield that kind of upside in 3 months !
Radical cheap: $1,000 homes
In places like Detroit and Cleveland, banks are unloading rundown homes for next to nothing. And they`re tremendous bargains, even after factoring in renovation costs.
http://tinyurl.com/9k9vkn
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QUOTE (wealthyboomer @ Jan 14 2009, 09:18 PM) Radical cheap: $1,000 homes
In places like Detroit and Cleveland, banks are unloading rundown homes for next to nothing. And they`re tremendous bargains, even after factoring in renovation costs.
http://tinyurl.com/9k9vkn
indeed .. but when factoring in vacancies, pain of owning, management fees, foreclosures nearby and destruction potential $1000 might be too expensive !! I am not saying it is .. it might !
In places like Detroit and Cleveland, banks are unloading rundown homes for next to nothing. And they`re tremendous bargains, even after factoring in renovation costs.
http://tinyurl.com/9k9vkn
indeed .. but when factoring in vacancies, pain of owning, management fees, foreclosures nearby and destruction potential $1000 might be too expensive !! I am not saying it is .. it might !
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Hi Wealthy boomer, common sense: what do you think is the vacancy rate in an area where you can buy a home for $1,000?
buy a gun and show me the tenants that prefer paying say $500 rent a month than buying the place for $1000
Weird situation eh, why in the world are there tenants in such a place? well I know there are but..scary. cheers.
buy a gun and show me the tenants that prefer paying say $500 rent a month than buying the place for $1000
Weird situation eh, why in the world are there tenants in such a place? well I know there are but..scary. cheers.
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QUOTE (thomasbeyer2000 @ Jan 14 2009, 09:37 PM) .
So if prices were $400,000, and have fallen to $350,000 and will likely fall to $300,000 .. but you can buy for $225,000 and cash-flow it .. why not buy then ?
This type of buying is to adhoc for me. My criteria is stricked. I use the cookie cutter approach. This is why I don`t need the day to day news hype.
So if prices were $400,000, and have fallen to $350,000 and will likely fall to $300,000 .. but you can buy for $225,000 and cash-flow it .. why not buy then ?
This type of buying is to adhoc for me. My criteria is stricked. I use the cookie cutter approach. This is why I don`t need the day to day news hype.
I have a question Thomas, is it realistic to be able to get a property at almost half price. I don`t know, because I can`t even find a realtor who would be interested in putting in those types of offers. We are considering a property listed at 379,900, now my question is, where would you start the offering in todays market place without offending the realtor or the seller. For those who are putting 20 -30 offers on various properties, my guess is they must be lo ball offers, and if so, where do you start with these offers?
So if prices started at 429,900 and dropped within 3 months to 379,900, what kind of offer would you be looking to put in?
Any comments would be appreciated
So if prices started at 429,900 and dropped within 3 months to 379,900, what kind of offer would you be looking to put in?
Any comments would be appreciated
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QUOTE (Sarnia @ Jan 16 2009, 09:59 PM) I have a question Thomas, is it realistic to be able to get a property at almost half price. I don`t know, because I can`t even find a realtor who would be interested in putting in those types of offers. We are considering a property listed at 379,900, now my question is, where would you start the offering in todays market place without offending the realtor or the seller. For those who are putting 20 -30 offers on various properties, my guess is they must be lo ball offers, and if so, where do you start with these offers?
So if prices started at 429,900 and dropped within 3 months to 379,900, what kind of offer would you be looking to put in?
Any comments would be appreciated
If your buying a investment property you put offers in that give you the cash flow you need.
So if prices started at 429,900 and dropped within 3 months to 379,900, what kind of offer would you be looking to put in?
Any comments would be appreciated
If your buying a investment property you put offers in that give you the cash flow you need.