All Forum Posts by: Joseph M.

@David S. , what should the allowed number of units be? I'm sure many people might think owning more than the property one lives in is greedy.  "Why do you need more? Can't you just be happy with one house?"

What are reasonable needs? Facebook recently approved $10 million a year in security for Mark Zuckerberg and his family.  $10 million is more than generations of families make in their lifetime. But in his world it's a 'reasonable need'. 

Maybe someone wants to have 4 kids and send them all to whatever college they want to go to . 

Maybe someone wants to make millions so they can travel wherever they want , eat whatever they want. Maybe one wants to do it so they can donate it all. I think it just can get messy when we try to define what is a reasonable limit of wealth one is to have. Everyone's dreams and goals are different so who are we to judge? 

Also should flipping be limited too? You can only flip X homes per year?

Median home price in L.A County is now $615,000 . In the city it's closer to $1 million now . In San Franciso $1.6 million but all these areas get multipe offers at these prices. Demand is still high despite the high  prices and the fact these prices are much higher than the U.S median home price. 

It'll be a downturn when we start seeing days on market increasing significantly and prices actually going down. Right now sales are down because inventory is low...but prices are rising. 

Regarding biggerpockets crowd and other investors unloading at the same time, not sure why that would happen. As long as investors bought properties that cash flow and had fixed mortgages there isn't a reason to be forced to sell at a certain time. Demand for rentals went up the last housing crash and rents didn't really decline at least in most markets. 

In regards to Chinese investors I know that a lot of the big investors have pulled out of some deals due to pressure from the Chinese government .  There was a big hotel project in Beverly Hills and Wanda Group backed out of it. This is a lot different though than the types of properties most on BP are buying and investing in. 

As far as renters not being able to afford rent of course it'll vary a lot by market too. California in general especially SoCal and the SF Bay area is very expensive, which is why many are moving to other places like Texas , Arizona,etc..but they are getting replaced by higher income people. 

One thing for sure though things don't go up up up forever and appreciation of 10%+ a year isn't sustainable.

I don't like the idea of government restricting how many units one can own. Everyone (or every bureaucrat ) will have a different idea of what is the 'limit' of properties one individual or entity can own.

I agree with what some other posters said that even if given the opportunity a lot of people don't want to own rentals or invest in real estate. I think it's easy to forget sometimes when on a site like BP that not everyone is interested in real estate. Most people view real estate as a big headache and/or risky. The mainstream media and financial publications usually say investing in stocks is the better option.

If it were the case that one big corporation or a handful of companies owned all the property in America, then I think it would be a different situation. If invitation homes owns 84,000 houses it's still a very small percentage of all the single family homes in America. I'm sure that if one is in an area that they are investing in heavily or were investing in heavily it would make things tougher for mom and pop investors , but I haven't heard anything like this at least recently. 

I know a lot of local investors actually have benefited from selling properties to these big funds/hedge funds. Since they are so big they can accept lower returns as they are buying in bulk. 

If the number of homes one can own as rentals is restricted, should the number of properties one can flip also be restricted?

Originally posted by @Daryl Winters:

I love Chicago, South side, you could get something decent and build a bit of equity for $200k, especially if you buy distressed for 100k and put 100k into it #upgrade. On the otherhand, you can barely get lunch in the west loop for the same price.

 Yeah Chicago is interesting like that. Very cheap properties, but also really expensive ones. In L.A the "base" is like $400k or so now even in rougher neighborhoods. 

In the example of buying a distressed place for $100,000 and putting in $100k renovation what would the property be worth after?

Originally posted by @Sam Shueh:

35% of a studio here.

 Renting out space in your studio apartment. House hacking Silicon Valley style. 

@Drew Sing , thanks for the detailed and informative post, really interesting. 

Look forward to reading more of your posts on the forum!

I don’t think there are too many people that see a house on HGTV and then want to move to that neighborhood. Also by the time the show films there and is aired they’ve probably been flipping in that area a while .

@Ron Gallagher In L.A a rundown fixer will be over 400,000 in a high crime area . Even small condos in rough areas are over $200,000 Median home price In la county is now $615,000 https://la.curbed.com/2018/7/24/17608186/los-angeles-median-home-price-june-core-logic

@Jamil Rivera The BiggerPockets podcast is excellent . I like the “Best Real Estate Investing Advice Ever “ podcast with Joe Fairless too he has a lot of great guests and asks great questions. Real estate guys podcast is good . It’s a bit different format and they have have a lot of ads but its interesting as they often focus on the overall economy.

@Amanda Hillard That is interesting you are building 4plexes. What does it cost you to build them per square foot ?