All Forum Posts by: Aaron Norris

On March 2, BBVA announced 100% financing for consumers in low to moderate income areas. They are also willing to help out with up to $4,500. While I haven't seen the program's full details, I'm certain they will have heavy qualifying guidelines (hopefully). 

I'm 38 this month and attending the wedding of my best friend, also 38, this weekend. He's never owned but lives in Los Angeles where even low-income inventory in his area starts in the mid $300,000s. A down payment is a HUGE hurdle for he and his fiance. They are both very responsible and would make great homeowners, it's the down payment in their market that has them stuck.

I posted this on Facebook and got lots of feedback on the NOW generation spending too much money on non-asset-backed items and experiences. Will a program like this, for "responsible" and "qualified" buyers, make a huge dent in your business in 2015? 

Keep in mind, even during the downturn, the VA no-down program was the TOP performing portfolio. Thoughts? I'm optimistic but also a little frightened.

Hi @Ryan Cauzza I guess my biggest concern for you would be jumping all in right away with $1 million in rentals if you haven't had experience handing that many. Plan on using a property management company?  

There are a few areas that will cash flow including some areas around Temecula like San Jacinto and Murrieta. They have some great newer inventory. I have my favorite rental there. There's always the High Dessert, Inland Empire and Palm Dale/Lancaster. Again, just concerned with the stress of putting it all to work so quickly if you haven't decided where you're going and the team you're putting together. I work full time and find more than 2 houses going at the same time a little difficult to manage. That's just me. 

Thanks @Joshua Dorkin - It's very difficult to share in a small post all of his thoughts from a 7 hour day and a 290 page book with 400 charts! And, to be fair for those that attended live to support our work (which we appreciate), I'll keep it brief. 

The conclusions drawn will mean different things depending on where an investor is at in their investing career (starting vs. approaching retirement) and by area (coastal vs inland, by product type and size). 

We're not expecting a decline in prices overall. Government manipulation could hurt or improve the market. The obviously taken a markedly different stance on housing with the new HUD Director.

We're asked our investors to consider re-positioning themselves as investors and not speculators. Take a good look at what you own and decide if the market did go down, is it sustainable. Some markets are already past the peak and in speculation territory. Some areas still have a long way to go in California and homes are still less than rent and well below replacement cost.   

I sure would love to see you get into a property to live in? Is there any way to get your client to buy a multi-unit and live in one of the units so at least your client's overhead is fixed? 

@Manch Hon , good observation. We don't always agree with our guests on that radio show but it doesn't mean we don't check out their work and respect the research. Some of our larger author/economic guests have a more national and global perspective. We all know real estate is very local. 

I will say one think about demographics. I do agree that they will eventually jump off the fence. However, as I approach 40, I still have a number of friends, particularly in the Socal area that are just now getting married, starting a family, and just now considering home ownership. They've watched the entire downturn and the attitude has been very "meh" because they seem more attached to their freedom of movement and ability to pick up and go, even out of state on a moment's notice.  They are still young, starting to get into interesting career positions, and not committed to much. Most live in Socal or NYC. They've already been priced out of coastal markets. I just had  a friend move to Las Vegas for that very reason. 

I don't think I'm a good example because I lived in New York for so long in 100 square feet. I actually don't want a big house. I have no great desire to move up, at least at the moment. When I do, I can't imagine I'm going to ever want a McMansion.

That being said, I'll be watching to see how demographics plays into longer-term trends locally and nationally. Will we have a huge gap in the move-up market in the next decade? Particularly in coastal regions? Is Gen X and Y more interested in urban and walkable communities than past generations? Have we gotten so used to smaller housing or living with parents that we don't mind smaller houses? Will the new emphasis on green and sustainability (not to mention higher utility costs) mean the death of McMansions?  

There are a few newer communities and I am going to be watching carefully here in the Riverside area. KB is building right now by an area that borders Grand Terrace. At least one of the tracts is marketed as a multi-generational home and I can't wait to see how they perform this Spring. The area has room for 1,500 homes. God I love this stuff. #nerdalert

You can find our show on iTunes by searching for The Norris Group or you can stream, download or read the show on our archives. Yes, some people rather read the radio show! Both interviews with Harry Dent are up.

http://www.thenorrisgroup.com/blog/category/radio/

Tell your friend to take it to one of the clubs. San Diego has three great clubs.  The biggest tends to be SDCIA. They can get up and talk about deals. Bill Tan is the owner of the club and one heck of a nice guy.

Thank for the plug Mike! Actually, our last three radio shows are pretty interesting because it talks a little more about a global perspective. Guests are Eric Janszen with iTulip and Harry Dent. Mr. Dent, is always a big interest in our network, at least out here in California it seems. He goes into what he thinks about China. Yikes!  His expertise is in demographics which always adds a very interesting layer. I just started listening to the second show which will get more into his predictions. We're on iTunes. 

Depends on what they are doing. Some coastal regions will pay handsomely for major makeovers and square footage additions. Not so much in inland areas. It only takes on bad speculation and buying too high to wipe you out. I'm staying conservative on numbers unless it's a long-term hold that I am getting financed. 

I'm actually rushing to edit the book and get it to print by Friday. I think Dad was actually surprised a little by his findings. This book is around 270 pages this time which is larger than usual. We explore a little more on demographics and do chat a little about monitoring the big hedge funds and when they plan on selling. For those that just planned to create the REIT and hold long term, they don't care. But for those that expected a year like 2013 to continue, well, what's their game plan now. I hear rumors of people who invested with some of these funds and they are not coming close to performing as they originally believed (at least from the cash flow perspective). Back to editing!