All Forum Posts by: Joseph M.

@Seth Borman If everyone that owned commercial property that they are renting out has their taxes hiked way up they will raise rents .

Originally posted by @Seth Borman:

Originally posted by @Alex Vidal:

The Prop 10 polls aren’t looking good for the Yes vote. My company’s various business arms have been pumping millions into the No side and it’s working because the Yes votes have no real logical argument other than short term benefits for current renters. If you’re familiar with SF apts it’s a prime example of what happens when you get rent control - crappy buildings/obsolete units and insane market rents that are artificially inflated by rent control.

The thing to watch out for if you own commercial deals (5+ unit apts too), is on the 2020 ballot they’re going to have a vote to separate prop 13 so commercial deals are no longer protected. This bill is very likely to pass since the typical mom and pop owners who own smaller buildings/single family homes will still be protected.

 The split roll won't effect any residential real estate. Even the residential portion of a mixed use building will still fall under current law. Size won't change that.

What the prop will do is kick underutilized parcels onto the market. Vacant land, parking lots, low grade retail, etc will kick loose for residential development.

 Which will accelerate gentrification..ironically.. There are still underutilized parcels in L.A , many of the owners don't have incentive, but if they have a big tax increase they will. 

@Alex Vidal , I've heard about the bills to overturn Prop 13 for commercial properties. This would result in higher consumer prices. It could also put many long time business owners that own their property out of business. Also with NNN leases the tenant pays taxes it could put them out of business.

Either way it puts uncertainty into the economy which isn't a good thing.

@Marisa Rowe Oh nice that is a great deal then. Are you doing your own marketing , direct mail etc to find deals? Or going through wholesalers etc ? Are you able to have your team handle a lot of things locally in Detroit or are you there a lot ?

@Marisa Rowe That seems like a great deal especially if it’s a B neighborhood. Is this in the city of Detroit or a suburb . Don’t know much about Detroit but I’ve heard many say the suburbs are better/safer. You bought it off market for $36k what would the retail or market price be ? Sounds like you are getting great prices on the rehab work too .

Best of luck, would be interesting to hear updates if you'd be willing to share as things progress.

@Scott Martin , thanks , I know construction costs are crazy right now in L.A . I've been looking at some of these new hip looking homes people are building in Indianapolis in Bates Hendricks area and selling retail at like $150 sq ft..their construction costs much be very low to buy the lot or house, build and sell at $150sq ft and still make a profit.

That is interesting about rehabbing the 6unit around Helms bakery. I used to live not too far from Culver City , and was there the other day and it was pretty amazing with the big project near the metro. Ivy Station. I had read it'll be geared towards people that work in DTLA but don't want to live in DTLA. 

Definitely not the sleepy town it was back in the day...

http://www.latimes.com/business/la-fi-ivy-station-...

@Ali Boone , I believe if Prop 10 passes cities would be able to limit what landlords could charge even if a tenant moves out, which would be really bad. I didn't know you owned a duplex in Venice, as I know you focus on out of state investing. I'm sure if you've owned it for even a little whole it has appreciated nicely. 

It seems like almost every multi in L.A is now advertised as a redevelopment type opportunity. Not sure the zoning/land size but would you be able to build condos or townhomes on the land? 

I saw an article recently about rent controlled apartments in Santa Monica getting turned into office space. 

There was a battle of course though 

https://la.curbed.com/2018/10/19/17991202/santa-monica-landmark-building-office-space

@Mark Wood , congrats on getting your first property under contract. What area is it in? always interesting to hear about people buying locally here in L.A. Does the property currently cash flow? 

I'm guessing that it could take time for the local cities to implement Prop 10 if it does pass. Last I heard the No effort had raised a lot of money , but I'm seeing a lot of Yes on 10 ads...I just got one in the mail saying to vote Yes to stand up to "Housing bullies" . They also make it seem like it'll fix the homeless situation , which is a lie of course.

@Casey Rolland  , big increases like that aren't sustainable. 

Yeah there have been quite a few articles recently talking negatively about the housing market. The mainstream media influences people for sure , so if more and more media comes out saying the housing market is bad or about to crash that's going to influence things.

Here is one Wall Street Journal just put out 4 hours ago , also many people just read the headlines. 

Housing Market is Faltering and Strong Economy Offers No Cure

https://www.wsj.com/articles/u-s-existing-home-sal...

One today from Fox Business 

Housing market exhibiting weakness

https://www.foxbusiness.com/economy/housing-market...

One from yesterday

Fannie Mae is 'pessimistic' about the housing market in 2019

https://www.inman.com/2018/10/18/fannie-mae-is-pessimistic-about-the-housing-market-2019/