If you can afford to buy a house/condo should you do it to avoid rent?

[maxtower]

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spex, what city are you finding deals in?

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I don't really understand the point of the question. What difference does it make? You can find deals in any city.

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I think he wants to know specifically what city you have found deals in.

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Thanks for the clarification [img]/images/graemlins/ooo.gif[/img]

I wasn't asking him what he wanted to know, I was asking him why he wanted to know it.

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I wasn't trying to call you out or anything. I was just curious. If you don't want to say thats fine.

I live in Phoenix, AZ, and it seems pretty hard to find a decent rental around here because prices are so inflated. Asking prices still have a long way to go to reach bottom.

[spex x]

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Spex, I wasnt trying to disprove you. You are correct in everything you said in this thread. I was just wondering if you think those futures contracts are right ni the sense thta housing prices still have a long way to drop from here.

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Oh, I wouldn't really know. I don't really know anything about future market prices and how they're determined. Like I've said, I only really pay attention to a few markets in my local area. But I don't aniticpate anywhere near the a 20% drop in housing prices in my local community. I think that my community has seen the worst of it already and prices will stay about the same for the next few years. But my market didn't get run up too high over the last few years - I think 7% appreciation over the last 3 years. Most of that was caused by the 10% population growth rate that we have here over the last few years - retirees are starting to trickle in. So a small correction was maybe due here, but I really think that we've seen the worst of it. Retirees are going to flood us for the forseeable future.

Outside of the local community, I can't say.

[spex x]

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I wasn't trying to call you out or anything. I was just curious. If you don't want to say thats fine.

I live in Phoenix, AZ, and it seems pretty hard to find a decent rental around here because prices are so inflated. Asking prices still have a long way to go to reach bottom.

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Asking prices are garbage. In my experience, sellers generally overprice properties about 30-100%. But people buy them, I don't know why. You find good deals through relationships with realtors, other investors, and lenders. The key to finding deals is to find MOTIVATED SELLERS. Another key is being creative in solving that seller's problem so that it works for both of you.

Start networking, that is the best way. Investors give each other business all the time.

[jaydub]

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I wasn't trying to call you out or anything. I was just curious. If you don't want to say thats fine.

I live in Phoenix, AZ, and it seems pretty hard to find a decent rental around here because prices are so inflated. Asking prices still have a long way to go to reach bottom.

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In my experience, sellers generally overprice properties about 30-100%. But people buy them, I don't know why.

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Statements like this are why nobody with any common sense believes you.

The range is ridiculously wide, you represent massive inefficiencies in a market with very public information, and you quite frankly exude a lack of intellect or knowledge while simultaneously dodging questions that press for details.

J

[spex x]

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I wasn't trying to call you out or anything. I was just curious. If you don't want to say thats fine.

I live in Phoenix, AZ, and it seems pretty hard to find a decent rental around here because prices are so inflated. Asking prices still have a long way to go to reach bottom.

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In my experience, sellers generally overprice properties about 30-100%. But people buy them, I don't know why.

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Statements like this are why nobody with any common sense believes you.

The range is ridiculously wide, you represent massive inefficiencies in a market with very public information, and you quite frankly exude a lack of intellect or knowledge while simultaneously dodging questions that press for details.

J

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If anyone with 'common sense' doesnt' believe me, then I guess everyone with 'common sense' probably wouldn't be a successful RE investor. Sellers ask for the most they think that they can get for a property. Most of the time the prices that they ask for are 30%-100% more than I, and most (but not all) RE investors that I'm aware of would pay for that property.

Now just because a seller asks for a price doesn't mean that he'll get it. I was recently negotiating the purchase of a mobile home park and the I got the seller to drop his price from $850,000 to $600,000. At that point the property has sat on the market for 9 months, and now its sat for over 12 months. The problem with his price was that it would've given me a very low cap rate that would not have been acceptable for an investment IMO.

Different investors, though, have different criteria depending on their goals. I buy RE for income. I have very stringent criteria for investment - 10% minimum cap rate and a 25% cash-on-cash return. But lots of people would take a 6% cap rate and a 12% COCR. Thus, according to MY investment criteria, sellers tend to overprice properties by 30%-100%.

[Shoe]

Renting is perfect for me. If I bought a house, just the taxes, insurance, maintenance, and interest would far exceed my current payment. The money I save from not owning I invest in the stock market whose returns far exceed that of owning a home.

Also, don't buy a home solely for the tax deduction. Take that into account, but don't let it be the only reason -- it is not worth spending $3 to save $1.

[Scruffey]

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surprised nobody talked about the advantages of rent control in some cities. If you lease the same place for many years the savings you will see are huge.

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ahnuld,

i'm sorry i haven't heard much about this but i am interested... you're referring to owning a place and renting it out, correct? and i am curious what are your thoughts about owning a condo and renting it out and what cities do you think are good for this??

thanks

[Michael Davis]

Rent control is for the benefit of the renter. There is a set percentage that rent can be raised over a set period of time. It's usually very small, sometimes 0%. The renter then pays the same rent for as long as they live somewhere.

I know a 90-year-old guy in San Francisco who is paying peanuts for his apartment because of this. It's a good enough reason to seek a rent-controlled opportunity.

-Michael