All Forum Posts by: Jimmy H.

Marc,

what BP member was that i'd like to talk to him about Cincy. And yes I think he is spot on. Cincy has seen a decline in population over the last 40 years or so so some housing sits vacant and/or adbandoned. Its a tough situation because there's an oversupply of housing stock but because of this not all of it is rented or even attempted to be rented nor is it all in rentable shape. there are bad areas speckled around cincy but a lot of change is happening and there are a lot of neighborhood in transition. I would research the neighborhood it is in, but in Cincy 15%+ CAP's ar enot uncommon.

This is the exact reason I am looking at markets in the midwest, particularly OH and IN. I think they offer great potential but there is adefinately a reason other investors are avoiding these areas, making CAP's so high.

Once again, I think I would rather invest in such areas than goto TX or others where most investor are focusing their efforts. a bit of a contrarian play in a sense.

this all depends on type of property, size of property, value of properties, risk of those properties, etc. Must take all that into consideration. If I own large apartments I would likely hold each in its own LLC. OTOH you could hold 10 $20k duplexes in the same entity. Depends on your partciular situation.

No matter what you should try to have more than one member to your LLC, maintain it as a seperate entity with seperate bank accounts etc, and keep your properties leveraged as high as they can support so that there is no equity to sue you for.

Marc,

That's my point exactly Indianapolis and many Oh markets are very attractive to me, but for some reason there is a large group on BP with the viewpoint that they would not invest in OH or the so called "rust belt" areas.

I have recently been looking at Fishers. where is the best place to research Indianapolis CF deals online?

We know baby boomers are retiring, they want beach front and golf course locations with little maintenance and ranch style one story living. That is the sterotype at least.

The new wave of "boomers" born between 1977 and 1994 are the future of America, generation Y. They are a much more diverse group. Being born in the middle of generation Y myself, I am interested in investing for the future of my generation.

You can research online what the new demographic will look like over the next 50 years. I want this thread to be a discussion of the type of housing, and specifically LOCATIONS that these individuals will want to live in. The trend is undoubtedly South and West and continues the trend identified by watching the progression of the "mean center of the population", which is somewhere in east Missouri at this point. This trend will likely continue, but where specifically are good areas with good jobs that are well poised for future growth. I would be interested to hear some smaller city ideas and not the typically Austin TX recommendation. Someone mentioned Springfield Missouri in a post i recently read, for example.

Thoughts?

I have been researching different markets around the country. Most will be quick to reccommend TX, AZ, FL, and CA.

As far as cash flow goes I don't see anything in those areas resembling the type of cash achievable in areas around the midwest rust belt (please correct me if i'm wrong). I do not want to completely sacrifice LT appreciation for cash flow, but for me, cash flow is king.

I know people like MikeOH makes his living here but I do not want to have to personally roll around with a .357 to collect rent. I want enough CF to hire property managers in the area and factor that in as a cost.

What do you think about the long term potential and demographics in the area. I tend to be a contrarian and when all of the focus is in TX or elsewhere I think the best deals will be find where most aren't looking. Opinions on the area, and why/ or why not invest there? I have been looking specifically at OH.

PS - A bar of gold will be worth no more than paper money in a doomsday scenario.

If America is SO terrible, please tell me which country you will be moving to that is better off than we are? And if your sticking around to fight the good fight (stockpiling guns and food), I think that is laughable as none of us know how to truly survive off the land anymore or you wouldn't be buying canned food you'd be planting crops - I say good luck to you Mr. Bear Grylls.

And a final conundrum for the armchair economist out there - explain to me why deficits matter?
Treasury auctions are receiving record amount of activity right now, but let's even say that disappeared and the Gov't had to buy and ALL of its own debt at auction - essentially pulling money out of one pocket and putting it in the other. Please tell me why this matters in a "worst case" scenario. Is the gov't going to foreclose on itself? Almost all countries have deficits and owe each other money. In the end - explain to me why deficits matter.

Thought I would revitalize this thread as in the past 6 months th economic outlook has soured again.

I personally find it hard to believe we are on the path to being a "third rate country" in the future because all other countries are facing similar situations. Developing nations are not experiencing exactly the same but have PLENTY of problems of their own (even things as simple as food and water for a billion people - and their own bubble's will bust as well). Will we be the lone dominant superpower we have been, no, but have we reached the apocalypse, no (Unless you believe the Mayans). We will remain a first rate country, but for the first time we will have company in that top tier.

The truth is that good times always come to an end and bad times always come to an end. In the short term the rental market will be great. Although people will move in together to save money, there are still plenty who can't buy a home and will rent (Not to mention our population adding another 100 million over the next 40 - 50 years). Vacancy rates are up of course, but I believe rents should be dropped accordingly (If you can cash flow at more conservative rents then you'll be fine).

I wouldn't expect property values to increase on the trajectory that they did during the bubble, they will increase in a more modest and healthy manner and will increase mostly due to the pressures of inflation which will grow much stronger over the next 2-3 years.

The real estate bubble can be likened to a stock bubble and other bubbles, but real estate as an asset is quite unlike any other asset in that it is a home where people live, it is a limited resource (land), it is part of the American dream (which may be altered now), and it is a nessecity to live (shelter).

Boom and bust is the story of any market, and the bigger the boom - the bigger the bust, and we are experiencing it now; But as the story goes, another boom awaits as in the future. The more fear in the market (even among investors and BP members i sense a lot of fear), the more opportunities you will find in the market. And I for one will be investing aggresively, for if we are entering super apocalyptic depression - everyone is going to be in trouble regardless of whether they invested or not - so i think it is a smart and opportunistic time to invest.

Turn off the news and you may notice that in your own life, things really aren't that bad, unless you've lost your job it really isn't as bad out there as the fear mongerers portray.

Think this way, if we simplified the decision into two choices: to invest and seize "opportunity" or to avoid investment and prepare for the worst of times. If the beliefs of the latter party come true, both parties will be equally "screwed". So why not roll the dice, the more people that watch the news and are scared - the better the opportunities are for me.

Two roads diverge in a (depressed economy), I will take the road less travelled by.

And frankly, the less people who take the road less travelled the better for me in the long run!

I am looking to invest in greater Cincinnati. Some great deals available in areas such as Mt. Auburn and Evanston, among others.

Anyone invested here? from the area?

Looking to network, discuss deals and specific areas of town.

Jon - I knew you'd be quick to answer me on this and you were the guy I was looking for.

Are you talking gross rents or rents per unit? Could be viewed either way?