patrick.net

gabbar says

Collapse, if and when it occurs, will happen because it will be what they want. There will come a point when people will say f u to mortgage payments.

That happened a lot in 2007 to 2012. A lot of owners stopped paying and refused to move out of the homes.

porkchopexpress says

This is awesome, man. I'm inspired by your story. I've only ever ...

Real estate is not for everyone. Find what your wife likes to do and have her pursue that. Then it’d be a hobby making money activity.

What I’ve learned is that, not taking risk is also making a bet. You don’t get to live your full potential. You have no safety net, your wife is not working, so it’s harder to take on risk.

I’ve always been a dreamer. I’ve been witnessing each dream came true at a time. It’s fulfilling. At this point, getting to a 9-figure net worth seems achievable and a 10-figure net worth is doable although we’re nowhere near there. It’s simply crazy to think about it for a guy who came to this country at the age of 16 without speaking the language. 😂

ad says

gabbar says

Collapse, if and when it occurs, will happen because it will be what they want. There will come a point when people will say f u to mortgage payments.

That happened a lot in 2007 to 2012. A lot of owners stopped paying and refused to move out of the homes.

I don’t know about other markets, but it was a mistake to walk away from their homes in MY market, the SF Bay Area. I was buying condos at $150-$160k each. These were going for $400-$450k at the peak of the market. Now, they’re selling for $600-$650k each. Rents went from $1.2k/mo then to $2.4k-$2.7k/mo now.

The same with SFH where value dropped from $750-$800k to $450k, and now they’re worth $1.4-$1.5M. SFH in working class neighborhoods dropped from $650k to $250k. Now, they’re going for $800-$850k. each.

4plexes dropped from $1.2-$1.25M to $800-$825k. They’re now $1.9-$2M each. 🤯

We’re all making bets. Some are more lucky than others. Not making bet is also making a bet. 😅

Soon correction be over. Folks gets inflation adjusted increase in wages.
Purchase power will overcome higher interes rates and housing market will go back on track.
Only persist inflation can hold it.

REpro says

Soon correction be over. Folks gets inflation adjusted increase in wages.
Purchase power will overcome higher interes rates and housing market will go back on track.
Only persist inflation can hold it.

Yeah I saw VA disability is going up about 8.7%, and I believe Social Security is also. True, as pensioners are going to have more buying power in 2023 if inflation continues to trend down.

12 month CPI is around 7.7% now, down from its recent peak of 9.1% around July 2022.

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ad says

Yeah I saw VA disability is going up about 8.7%, and I believe Social Security is also. True, as pensioners are going to have more buying power in 2023 if inflation continues to trend down.

True, that may affect the cost of lower end cars, but people relying on pensions are not in the market for high priced homes.

Any predictions for the 2023 spring market?

In Santa Cruz, things are in an intermediate stage. Houses coming on the market at seller demand excess prices, not selling, inventory increasing and occasional break throughs of price drops for those who actually want or need to sell. They aren't always stating price reductions.

One house we walk by that has been on market for a while now had hundreds of thousands drop, but never stated it on the listing. Irrational price and equity fantasy exuberance seems to be slowly chipping away. It'll be interesting to see how things sort out by Feb. 2023.

GNL says

Any predictions for the 2023 spring market?

usually goes up in spring.

FortwayeAsFuckJoeBiden says

GNL says

Any predictions for the 2023 spring market?

usually goes up in spring.

I will assume that you are referring to the month's supply for next spring...

https://sfstandard.com/business/empty-offices-are-dragging-down-san-francisco-home-prices/

ad says

A lot of owners stopped paying and refused to move out of the homes.

American people are just too nice. They should say f u to the whole real estate+bankers cartel every fucking day. Let the fuckers do what they want.

For anyone who thinks it’s not possible, this 19 year old kid is doing it in his Midwest market in the current market conditions. He’s inspired by people, who have been there, done that, and took action. His goal is 250 units. 19 years old and bought a 4-plex.

@Eman

Did you start out like this? If so, how did you manage rent collection and maintenance?

Eman says

For anyone who thinks it’s not possible, this 19 year old kid is doing it in his Midwest market in the current market conditions. He’s inspired by people, who have been there, done that, and took action. His goal is 250 units. 19 years old and bought a 4-plex.

Slum lord and lipstick on a pig. I feel for the people that end up renting those units. Gotta learn somehow I guess.

Those decks are half rotted as well. No pavement for parking? That for sure is ghetto special. I hope he doesn't hit his goal because that's 250 miserable tenants with what I'm looking at. Just being honest

This is how they corrupt the young'uns. Free money for exploiting your fellow (to be honest, a mouth-breathing section-8 renter) human. Just like cops who only see the worst of humanity, they eventually see their "customers" as subhuman trash

"Through a combination of bank and private debt." Let me translate - "with mom and dad giving me money for the down payment and then cosigning the mortgage."

stereotomy says

This is how they corrupt the young'uns. Free money for exploiting your fellow (to be honest, a mouth-breathing section-8 renter) human. Just like cops who only see the worst of humanity, they eventually see their "customers" as subhuman trash

We never had an issue with section 8 tenants. I think that's a huge misnomer about them. They're on the streets if they don't keep their voucher. Some of the best tenants we had. On their best behavior. We had to keep the units ABOVE building code for Section 8 versus market rate tenants, so not slum lords. We weren't in NIMBY land though. They're the ones that bitch about section 8 the most and have no clue about it.

WookieMan says

We never had an issue with section 8 tenants. I think that's a huge misnomer about them. They're on the streets if they don't keep their voucher. Some of the best tenants we had. On their best behavior.

Around here and in Oklahoma, I could tell the Section 8 houses in a neighborhood by the unkempt lawns, broken tricycles lying about, etc. When I had rental property in VA, I was approached several times to do Section 8. I refused, since my rentals were all single-family homes in nice workers/jr management type areas. I did not want to insert a welfare household next door to hard working people paying off a mortgage.

How about a strategy of buying enough rentals in a nice neighborhood and rent to section 8. Then once you've pulled the values down enough, buy a shit more houses and then end all section 8 rentals and bring the neighborhood values back?

GNL says

Eman

Did you start out like this? If so, how did you manage rent collection and maintenance?

No, I started out buying REO’s, but got wise quickly and learned how to buy properties at the courthouse steps for pennies on the dollar. Then rehab, rent it out, refinance, rinse and repeat. My dad is a GC so it’s a walk in the park.

One of Patneters, with an open-mind, joined me on this venture, and we bought 6 properties together. All financed under his name. I didn’t have a job so bank wouldn’t lend to me. They’ve gained over $2M in equity and cash-flowed over $4k/month, not including principal pay down, etc… Each of us invested $150k in these 6 properties. He didn’t want to stick around to refinance and get the cash out of these properties. Retired at 40 and moved to Brazil with a young Brazilian wife. Patrick, mell and a few other Patneters know and met him in person.

When he retired in 2013 and moved to Brazil, I was approached by a smart and wealthy individual who sold his startup company and has retired since 2000 at the age of 30. He was introduced to me through an acquaintance. I showed him what I did. He said it’s not “scalable” and wanted something that can scale. That was when we got into apartment investing. He chose the San Jose State University market as it’s “recession proof”. We also explored the Fresno State University and Easy Bay University markets, but decided to stay “local” and expand in this market. With his net worth, financing was a walk in the park as banks lend money to people who don’t need money. The rest is history.

HeadSet says

"Through a combination of bank and private debt." Let me translate - "with mom and dad giving me money for the down payment and then cosigning the mortgage."

I don’t see anything wrong with this. Parents would love to help their kids out when they’re starting out….at least in my culture. I made this offer to all nieces and nephews on both sides of the family. Come to us if they ever need money for their ideas.

Eman says

HeadSet says

"Through a combination of bank and private debt." Let me translate - "with mom and dad giving me money for the down payment and then cosigning the mortgage."

I don’t see anything wrong with this. Parents would love to help their kids out when they’re starting out….at least in my culture. I made this offer to all nieces and nephews on both sides of the family. Come to us if they ever need money for their ideas.

That ain't the point, spread your silver spoons all you like. Just do not have the kids claiming they are self-made individuals and investment geniuses.

HeadSet says

Eman says

HeadSet says

"Through a combination of bank and private debt." Let me translate - "with mom and dad giving me money for the down payment and then cosigning the mortgage."

I don’t see anything wrong with this. Parents would love to help their kids out when they’re starting out….at least in my culture. I made this offer to all nieces and nephews on both sides of the family. Come to us if they ever need money for their ideas.

That ain't the point, spread your silver spoons all you like. Just do not have the kids claiming they are self-made individuals and investment geniuses.

I guess we don’t share the same point of view. If a kid is unmotivated, he’ll burn all of the money his parents give to him or his inheritance.

To get started, he can either borrow money from an investor for a down payment, who will likely want a big cut of the equity, and borrow a hard money loan with high interest rate and pay points. Borrowing from acquaintances, or parents, provides a little more buffer and some safety net. I don’t see anything wrong with that.

At the end of the day, we don’t know how he financed the deal. It was all an assumption. I’d rather give the kid the benefits of the doubt than the naysayers.

Got to have a positive attitude. That + hard work can conquer any goal.

Why Blackstone's $69B Property Fund Is Signaling Pain Ahead For Real Estate

https://www.fa-mag.com/news/why-blackstone-s--69b-property-fund-is-signaling-pain-ahead-for-real-estate-70916.html

DD214 says

Why Blackstone's $69B Property Fund Is Signaling Pain Ahead For Real Estate

Blackstone is at $82 and is down 42% from its all time and 52 week high. Looks like it has more room to drop to early 2020 levels which is around $62 a share.

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ad says

Blackstone is at $82 and is down 42% from its all time and 52 week high.

Is that all? Sheesh.

B.A.C.A.H. says

Blackstone is at $82 and is down 42% from its all time and 52 week high.

Is that all? Sheesh.

I checked MSN Finance, and Wall Street analysts forecast $100 in 12 months for Blackstone. Analysts hype the price of stocks like Blackstone.

I would not be surprised if Blackstone reaches $60 (i.e., early 2020 price levels) which would mean the stock drops 58% from its all time high and 52 week high.

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Eman says

My dad is a GC so it’s a walk in the park.

Don't let out any trade secrets! Making more sense now. So, I'm assuming you're partnering with him on the flips.

ad says

I checked MSN Finance, and Wall Street analysts forecast $100 in 12 months for Blackstone. Analysts hype the price of stocks like Blackstone.

I would not be surprised if Blackstone reaches $60 (i.e., early 2020 price levels) which would mean the stock drops 58% from its all time high and 52 week high.

Hmmm. You may be right about the $60.

Considering that the prices (values?) of stuff are set in the marketplace, I wonder in a world with choices who'd pay $60 or even one dollar to invest in something that limits redemptions.

It's not like they're the only real estate hedge fund in the world.

EBGuy says

Eman says

My dad is a GC so it’s a walk in the park.

Don't let out any trade secrets! Making more sense now. So, I'm assuming you're partnering with him on the flips.

@EBGuy, actually no. I have a flip partner. A young 31-year old hustler. He handles all the deal sourcing and rehabs. I’m mainly an equity investor. I only get involved in the initial design and relayout of the flip. Then I have the final say on accepting the offers. I think he owns 12 rentals now, all by himself. They’re all in the East Bay.

I also have a multifamily partner where we handle a lot of our repairs and maintenance stuff. We have a full-time handyman who handles all the small stuff. For big rehabs, we use his GC. I don’t want to get my family involved in these things.

@EBGuy, my dad did help to rehab 3 out of 6 units I co-own with pkennedy at cost. The other 3, pkennedy and I rehabbed ourselves. My dad rehabbed all my personal units.

What I’ve learned is that once a unit is fully rehabbed, it’s less hassle and the turnover time is much quicker. I send in my handyman to handle the cleaning, paint touch-ups, minor repairs and swap out new door lock, and voila, they’re done within 2-4 days.

@EBGuy and @Patrick,

pkennedy will be in town next week for a few days, 12/12 - 12/15. Let us know if you guys want to meet up on 12/13 or 12/14. I’m unemployed so my schedule is flexible.