Monthly Archives: February 2008

February 17, 2008 · 12:32 pm

New Zip Code Appreciation (Depreciation) Map for Kansas City Real Estate

Last year I linked to the the Kansas City’s Star’s report on housing appreciation in the Kansas City metro area. By in large there was modest appreciation and some depreciation…but not enough to worry about in most places.

This year’s interactive map shows a different story. Read the entire story here. (NOTE:If the Kansas City Star holds true they will not have this map up indefinitely. Housing Under Microscope So it’s possible the link will lead you to nowhere after a couple weeks. If they do you can purchase a zip code map for Kansas City by clicking Zip Code Map.) Now let’s put the numbers under the microscope and see what we see. Especially for those out-of-staters that read this Kansas City real estate investing blog. You need to have the full story interpreted.

Everyday I get would be real estate investors calling from around the country. Especially California. They are always wanting to flip houses and/or buy the lower priced houses in the city so they can get “good cash flow.”

The houses they like to target are generally located in the following zip codes:

64130 -23.4% -19.6%
64132 -12.8% -12.4%
64134 -14.6% – 9.3%

Next to the zip codes above is the “appreciation” rate for those areas in the last year, followed by the Kansas City Star’s explanation of the appreciation rates for all years dating back to 2003.

Now lets look at the zip codes where I’ve had my last 10 transactions since December:

66204 + 1.4% +11.7% (1 unit)
64083 + 6.0% N/A (3 units)
66106 -10.5% +0.7% (We got a steal on a rehab)
64064 + 6.0% +17.4% (2 units)
Gardner – not listed though I suspect close to Olathe’s 66062 at +7.6% +43.2%

Hey, out-of-state investors. Do you see what I’ve been talking about for the last 3 years?

While much of the country suffers through a housing correction not seen in many’s recent memory here in Kansas City the real estate investor can still find opportunity. Yes, we have areas that are suffering greatly. They are not areas that I’ve endorsed anyway. Successful real estate investing takes study, analysis and local knowledge.

And that is true whether you are investing in real estate around Los Angeles, Sacramento, Washington, DC, New York or right here in ole KC.

6 Comments

Filed under Kansas City neighborhoods, Kansas City Real Estate

February 15, 2008 · 11:20 am

Paul Wenske: Worth Reading In The Kansas City Star

Paul Wenske is a columnist with the Kansas City Star who writes an In Your Corner piece each week. He also can be found in the Business section from time to time. He is constantly addressing the real estate situation here and around the country, among other topics.

I’ve been reading Mr. Wenske’s pieces for over a year now. They are usually pretty well balanced and he uses good old fashioned common sense as his measuring stick. So consider this my endorsement of his efforts.

Click the link above and read some of his article that are still posted. And let me know what you think.

1 Comment

Filed under Worth Reading

February 14, 2008 · 9:29 am

Is The Security Worth The Risk?

Real estate investing takes a little bit of risk. But why do we take that risk? Because we are seeking security.

I thought of this last night at 2:54 am when my three year old came running down the hallway crying. She entered our room and jumped up on the bed and crawled in between her mom and I. Seems she had a bad dream that there were spiders in her room and they were “getting” her. (Hey, she’s three.)

So she risked getting out of the safety of her covers to run down the hall where she knew she would be secure. Secure between her mom and dad she knew nothing would dare touch her there. Every parent knows what I’m talking about.

Do we ever really grow up?

One of the most common situations I face as a real estate investment adviser is when a husband and wife come in to meet for the first time. One or the other will not be 100% on board. And usually the more willing of the participants is looking to me to help convince the spouse.

Sorry, I don’t do marriage counseling. 🙂

But I am more than willing to layout the risk versus reward factors. Is the risk and the additional work you are taking on worth the security you are seeking? Security for a Retirement Worth Having. Only the couple, together, can answer that.

There are ways, of course, to minimize the risks you take when buying your first income property. Find a real estate agent that understands residential real estate investing. Understand the numbers of a neighborhood. (Vacancy rates, rental rates, turn-around times, appreciation rates, etc.) Understand the numbers of the financing choices available. Understand entry and exit strategies. Have ready cash reserves.

Sooner or later everyone needs to decide what they are going to do about their financial future. I commend the the 20-33 year olds who are already moving on their future. But in fairness, that’s a group more ready to embrace risk. It’s the 35-50’s that have earned something, have assets in play and are deciding on whether to risk those assets or not that I’m talking to here.

Evaluate the risk. And decide it it’s worth the security you will have later down the road if all goes well.

Cat Soup

I promise to get back to real estate investing. But this is so darned funny. In fact, their whole website is absolute genius! Vist it at www.smosh.com

Boston Legal: I Believe Tonight’s The Night

I’m about 99% sure tonight is the episode that my friend Doug & I are extras on the set of Boston Legal. I’m told we’re the third scene from the end. It will be a dinner scene in which I’ll be sitting off the right shoulder of Denny Crane (William Shatner…Bill to his friends). 🙂

See diagram for what I remember the scene to look like. Keep in mind we are supposed to be in a restaurant so I’m eating the same salad for almost an hour. But such is the life of us Hollywood stars.

All in all it was a fantastic experience. And if I’m wrong about tonight then we’ll definitely be on next week. I know the election night coverages have put their schedule off a bit.

Here is a photo of Doug Dickerson and I getting our photos taken on the famous balcony. This photo was taken immediately after the shoot so you can see the crew in the background breaking down while a set director hurriedly took our picture.

I sat down expecting a real chair. But they are hard plastic. The scotch glasses are nothing more than cheap plastic. The law books are foam. It’s an amazingly fake world they create. Even the city scape scenes are done with smoke and mirrors. It’s pretty cool.

Editor’s Note: I just received this email from a guy who would know about tonight…

Regarding your episode Tuesday, you two will be seen in the
background of the third to last scene in the show. It will
be in the last act, and the scene comes after the “farewell”
scene between Candace and Scott Bakula (they say goodbye in
the courtroom). Unfortunately, because of the position of
the camera, you pretty much see only the back of your head
as the camera pans across you to Denny. There’s also a
quick cut back to the wide shot halfway through the scene
and we csn see your entire table behind Denny & Shore’s table.
But remember, it’s a quick cut; I did it that way to emphasize
Denny & Alan’s surprise to their “date’s” philandering. Oh
well, at least you got to eat at the table next to the big
cheese’s!

So there you have it! Heck, I’ll take what I can get. It was fun. And we got free pizza!

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Filed under Uncategorized

February 12, 2008 · 7:51 am

Texas 72 Kansas 69

Jackie Chiles “This is the most humiliating yet of my many public embarrassments.”

Obviously Texas was cheating and the refs were turning a blind eye to the madness. 😉

3 Comments

Filed under Kansas City Sports

February 10, 2008 · 8:48 pm

Debt Investment Calculator

debt There is good debt. And bad. Most is bad.

An example of good debt would be proper usage of leverage for your real estate investments.

An example of bad debt would be Friday night on the town on your MasterCard at 21.35% per year because you don’t have enough to pay the card off when the debt comes through. Or the clothes you shouldn’t have purchased. Or the vacation you should have put off, etc.

Rather than investing in real estate or the stock market before it’s time you might want to take a look at the returns paying down your debt can bring you. Bud Harvey, a CPA here in the Kansas City area has a nifty little Debt Investment Calculator on his website. I invite you to go an play around.

4 Comments

Filed under Calculators