I’m currently raising two teenagers. And I’m currently managing six tenants. The behavior patterns, by in large, are very similar. I’m constantly tested. I constantly have to examine the underlying motivations to the current actions. I have to have set rules and then enforce them.
Are you worried about whether you could own and manage real estate investment property? Well, if you have raised, or are raising, teenagers then you can manage rental property. Trust me.
Filed under Property Management
There is a lot I do not know. Physics, for one. Macro-economics is another. (I am one of the few real estate bloggers that will tell you that, I’ll bet.) But I do know my checkbook. I know the hurt I see families going through with their struggling in this economy. I know real estate agents and mortgage officers around the country that have disappeared and I have no idea where they are or how they are doing.
I know Kansas City is suffering but not nearly to the extent of so many other cities and their economies. And I know that the whole Freddie/Fannie thing is causing indecision with people that really should not be indecisive at this moment.
I know, and I truly believe this, that fortunes in the next real estate market are being made now.
This post is not put out for the marginal buyers of real estate investment property. In this economy if you do not have proper reserves and a proper down payment you need to conserve liquid assets until you do. Do not gamble on appreciation or quick re-sales.
This post is addressed to those of you I’ve spoken with in the last 30-60 days sitting on the sidelines with heavy assets. You know who you are. $80,000 to invest. $100,000 to invest. $120,000 to invest. Plus reserves in retirement accounts and great equity in your primary homes. You should be in this real estate market.
To some of you I’ve mathematically shown you how you will benefit. Even IF Kansas City suffered a 10% down fall over the next year or two you would still come out ahead, way ahead, in any 8-10 year scenario. And I cannot think of a time ever that Kansas City has suffered that kind of decline. And I really don’t imagine it happening now in the areas I would invest in real estate in Kansas City. Market fundamentals should tell you the same thing.
Filed under Personal Real Estate Opinions
US Government takes over mortgage giants
Fannie, Freddie: The biggest losers
What rescue means for mortgage rates
Let me just say that tomorrows riches are being made today. No. I’m not kidding. If you have cash, healthy credit and the smarts to buy on proper fundamentals now is the time to move.
Filed under Worth Reading
“Residential real estate conditions weakened or remained soft in all Districts, except Kansas City, which reported a modest increase in sales since the last report.”
The quote from above comes from Money & Markets. It’s worth the read.
The positive is KC gets an “atta boy.” The bad news is the rest of the author’s opinion. As always, I believe a glass half full can also be viewd as half empty. So you decide.
Filed under Kansas City Real Estate, Worth Reading
There has been quite a discussion over at BawldGuy as to the shape and direction of the economy. Jeff maintains that the recovery is starting or at least poised to. At least one experienced real estate investor and one investment banker disagree thinking we are at least one to two years away. Both point to evidence supporting their suppositions. Both sides making excellent points. (Make sure to read the comments!)
I’m not here to sit in judgement. But does it remind you a little of the upcoming elections? So much of the way you behave has to do with the way you see the world.
Getting back to the BawldGuy discussion the thing that seemed to be relatively ignored by the Bears of the argument (not saying they are Bears…merely that their arguments are Bearish) is that you can still buy real estate investment property that makes sense with 10% down or 20% down. But you absolutely have to work your numbers backwards.
“However, even at 50 percent off, he could not find anything that would pencil out when he worked backwards from what tenants could afford to pay.”
Obviously, if you work your numbers from either 10% or 20% down (heck, 50% down) and after your taxes, insurance, property management, reserves, repairs, etc. the numbers do not reflect what a tenant will be willing to pay for that rental property then you are not buying on proper fundamentals.
If you do buy on proper fundamentals then whether the economy has a short burst of appreciation, a long term stagnation or even a short term deflation you are going to be okay. Because that property will pay for itself in good times and bad.
This doesn’t have to be rocket science, people. We all agree that over the long term real estate is a fantastic investment. So why are we arguing over 6-24 months?
The Answer: Because from where I sit, in Kansas City, we’ve been relatively insulated. Yes, we’ve experienced a slow down in all areas of real estate like everyone else. But deflation in the neighborhood of 50%? Thank God, no. If we had, maybe I’d sound more Bearish. 🙂
Filed under Misc. Real Estate, Personal Real Estate Opinions
I went out with my wife today to preview three investment properties that showed promise. Well, they showed promise on paper from the viewpoint of the MLS. But then, this is why real estate agents will never become obsolete. Seeing on a computer screen and seeing in person are two completely different things.
When you are looking for your next real estate investment you must know the criteria that you looking to fulfill so that when you see it you can buy it. And when you don’t see it you can move on. Knowing my own criteria and that of many of my clients I was able to scratch off two of the properties with just a cursory glance. The third shows promise.
Examples of criteria include;
Think of criteria as your map. The houses I looked at in Olathe that were for sale were okay houses. They matched the city, price range…heck, they matched all of the above…but two of them did not meet the floor plans I like. No flow. Choppy. (Is that really a word?) 
When you are looking at your next investment property you have to put yourself in the shoes of the type of tenant you want. What will they pay extra for? What will they shy away from?
It’s your money. Think before spending.
Filed under Real Estate Investing
Labor Day.
You know. The day we celebrate the American work ethic by taking the day off.
Does this make any sense to anyone? 🙂
Filed under Uncategorized
BBQ Capital | Kansas City Real Estate Investing 