Monthly Archives: March 2007

March 23, 2007 · 1:46 pm

Kansas Jayhawks Move On To Elite 8 & Some Real Estate Thoughts

I’m trying to keep my mind on real estate today. But I have to be honest and let you know it keeps going back to last night’s game and forward to tomorrow’s game against UCLA. Don’t worry, however. I had a closing today. Showed a couple places. Writing an offer tonight. So I haven’t stopped working. Just have Jayhawks on the brain!

Kansas City real estate seems to be getting quite a bit of attention from around the country. I have probably had 11-13 inquiries this week by phone and email asking about our market, what places rent for, where is the best place to own? Owning rental property to help fund your retirement is a great idea. And Kansas City is one of the few metropolitan areas around the country where investment property is still “affordable”.

And don’t forget…there are 4 Benefits to owning income property in Olathe, Kansas City, Overland Park, etc.

Cash Flow Before Taxes
Principal Reduction
Depreciation
Appreciation

I spotted some great condos in Lawrence, Kansas yesterday. Priced at $73,000 they are converted apartments with new mechanicals and vinyl siding. Two bedrooms and one bath located a few minutes from the campus of the University of Kansas. Rents should be $550-$600/month. Priced at $73,000. Email me for more info.

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Filed under 4 Benefits of Real Estate Investing, Kansas City Sports

March 22, 2007 · 1:17 pm

Olathe, Kansas – Poised for Housing Growth

There are many reasons to consider Olathe, Kansas as a place to live or invest. Quality housing. A school district that is second to none. Ample dining opportunities as well as shopping. Good road network. Safe communities.

If you are looking at Olathe as an investor an article in yesterday’s Kansas City Star had this to say;

The growth boom in Olathe is not expected to slow anytime soon, city planners have predicted. So much so, that according to their estimates, they expected Olathe’s current population of roughly 120,000 to grow to 325,000 by the year 2050.

Wishful thinking? Not by City Planner Bryan Dyer’s numbers.

“We might be off by a person or two,” he joked when discussing the numbers with members of the Olathe Planning Commission recently. “We know there is a strong interest out here, and as long as we keep roads and city services growing the population will continue to follow that trend.”

Dyer, who leads the city’s Long Range Planning Division, said he also expects the city to grow from its current 60 square miles to more than 90 square miles in the next 50 years.

Seems to me that is very good news for the rental property owner as well as the “regular” home owner.

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Filed under Kansas City neighborhoods, Real Estate Investing

March 21, 2007 · 7:40 am

MAREI of Kansas City

On the evening of April 10, 2007 I have been asked to be a guest speaker at the Mid-America Association of Real Estate Investors (MAREI) meeting. Kim Tucker has asked me to speak on the advantages of Buy & Hold real estate. My favorite subject. Especially with today’s current state of affairs in the real estate market.

By following the link above you can find out the details and even plan some time on your calendar to come on out and listen. It is my hope to make it worth your time and money.

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Filed under Real Estate Investing

March 20, 2007 · 7:58 am

Family Given a New House And Other Housing News

Thank you Extreme Makeover for the house you gave to a family in need. This Kansas City Star article will warm the heart.

The housing market had some mixed news today, as reported in the Washington Post. In short, new starts were up, but permits were down. Folks, this is a natural correction, a needed one, that everyone will survive. You keep hearing that investors have lost money. I would argue that. Speculators have lost money. Investors will hold their properties taking advantage of all the new renters coming back into the market. Then, in a year, or two, or three when the market is hot again, they will sell. (Hopefully using the 1031 exchange where applicable.)

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Filed under Kansas City Real Estate

March 19, 2007 · 9:37 pm

Stock Market vs. Real Estate Investing

I have discussed before the 4 benefits of owning residential investment property. And today I had a little fun with a stock broker from Kansas City that was, well gloating I think would be the term, on the fall of real estate as an investment vehicle.

Really?

I know I shouldn’t do these things, but I decided to have a little fun with him. Here is some simple math;

$100,000 invested in the stock market returning 10% a year (his number) will give you a $10,000 increase in your portfolio after one year. Not too bad, actually.

$100,000 invested in real estate, however, should net you around the $20,000 in the same period of time. Is that better? Let me explain.

Take the $100,000 cash and purchase $400,000 worth of real estate (4 $100,000 houses, 1 $400,000 apartment…really doesn’t matter) with a historical appreciation rate of 5%. That leads to a $20,000 increase in property value after one year.

Now you may want to say what if houses don’t appreciate 5% this year? Good question. But if you are holding for 6-8 years, does it matter for any one year what appreciation is? Remember, historical appreciation in Kansas City is 5% on average. Some years have been 10%-12%. Other years, like last year, were -2% to +3%. Heck, my zip code was 6.6% last year.

“Wait. We’re not done here yet,” I told him. “Remember, real estate yields four benefits; cash flow before taxes, principal reduction, depreciation and appreciation. We’ve only discussed one of the benefits!”

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Filed under 4 Benefits of Real Estate Investing, Real Estate Investing

March 19, 2007 · 7:31 am

Investment Real Estate Profitability

You MUST know your numbers when you are going to purchase investment real estate here in Kansas City. Or anywhere, for that matter. Here in Kansas City, I feel like I’m alone in this proclamation. And as I look around the country, I find very few professional real estate agents who truly work with and understand the purchase and management of rental property.

If you have some time, I would urge you to bounce around to a few of the real estate links you will find on the right hand column of this blog. One is Bawld Guy Talking. He is an investment real estate agent out in the San Diego area. His blogs are always worth reading.

Last week I added Indiana’s own Land Chasers. He has some good posts over there.

Yesterday, I added Equity Scout. It is another blog certainly worth your time if you are involved with, or thinking about investment real estate. I believe it is authored by Christopher Smith and he has another blog. And here is a link to that blog and an extremely relevant article.

Kansas City is a great real estate market for the investor. And it never hurts to get opinions from other professionals, especially if it takes you just a moment of your time.

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Filed under Kansas City Real Estate, Real Estate Investing

March 17, 2007 · 11:02 am

Collecting Rent in Kansas City…or Anywhere

Listen, most of us don’t want to admit it but money makes us make silly or bad decisions at times. And KMBC news reports that a terrible decision was made today by both a landlord and tenant in Kansas City.

No details were given other than the tenants were moving out. I can only assume rent was still owed and the landlord wanted it. But reasons are not what is important here. What is important is that one man has lost his life. Another is in the hospital and facing capital murder charges.

Don’t get yourself in this position. Hire an attorney, a property manager, whatever. Just don’t risk your life or freedom for one, two or three month’s rent. The trade isn’t worth it.

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Filed under Property Management