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Investors rush into SF Bay Area real estate deals

By curious2   2012 Nov 12, 3:17pm   2,020 views   11 comments   watch (1)   quote      

"Droves of cheap foreclosed homes are drawing serious investor money. From mom-and-pop folks seeking retirement income to Wall Street-backed funds with hundreds of millions to spend, investors buy distressed homes to either fix and flip or, increasingly, to hold and rent out, mainly focusing on the most-affordable areas - those most devastated by the downturn."


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1   ducsingle5313     2012 Nov 12, 4:00pm  ↑ like   ↓ dislike   quote    

After renting this and similar homes out for five to seven years, Praxis will sell, hoping for significant appreciation.

My guess is the price/rent ratio only works in very outlying (less desirable) Bay Area locales. And if these companies are paying cash, it seems like there is a high lost opportunity cost? I wouldn't want to rely on "significant appreciation" over the next 5 to 7 years.

2   bmwman91     2012 Nov 12, 4:16pm  ↑ like (1)   ↓ dislike   quote    

ducsingle5313 says

I wouldn't want to rely on "significant appreciation" over the next 5 to 7 years.

Do not underestimate the lengths that the government (local, state and federal) and the central banking nexus will go to to ensure inflated property values. Our president has openly declared that he will put a floor under housing prices, and the Fed has openly stated that their goal is to create the wealth effect via "home equity" to get consumer spending up again (which is supposed to be a panacea for our unemployment situation).

3   Ceffer   525/525 = 100% civil   2012 Nov 12, 4:42pm  ↑ like   ↓ dislike   quote    

I love newspaper articles that ignore the distinction between advertising (real estate) fantasy/puffery and reality.

Another "get them while they're hot, get rich quick" lure for the suckers, a service for the real estate advertisers disguised as journalism.

4   curious2   537/537 = 100% civil   2012 Nov 12, 4:50pm  ↑ like   ↓ dislike   quote    

Ceffer says

a service for the real estate advertisers disguised as journalism.

I liked the headline about "rushing," i.e. not taking the time to think things through. The investors are presumably looking for an inflation hedge, the investment companies are making money providing one, but no one knows where prices will go.

5   37108605     2012 Nov 13, 12:04am  ↑ like (2)   ↓ dislike (1)   quote    

There is an adage that goes,


6   37108605     2012 Nov 13, 12:04am  ↑ like (3)   ↓ dislike (1)   quote    

And with that stated,

a fool and their money are soon parted!

7   coriacci1     2012 Nov 13, 12:23am  ↑ like (2)   ↓ dislike   quote    

sfgate, real estate shills from the getgo. a never ending story.

8   edvard2     2012 Nov 13, 1:14am  ↑ like (1)   ↓ dislike   quote    

This whole thing was written like an ad.

9   thomaswong.1986     2012 Nov 13, 2:22am  ↑ like   ↓ dislike   quote    

When it comes from SF..there usually is a self interest behind it.

10   BobMSN     2012 Nov 13, 3:11am  ↑ like   ↓ dislike   quote    

When someone tried to convince the public that a stock is booming, he is ready to unload.

11   REpro     2012 Nov 13, 5:27am  ↑ like   ↓ dislike   quote    

It looks to me like a typical Wall Street game. Wipe from the market low priced inventory, created greed, lift prices, and spread more greed, then when profit rich 25-35%, big players will dump 1000’s of homes back on market living unaware last time buyers with losses.
By the way, stock market appear to me like is ready for another sharp decline.

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