All Forum Posts by: William Coet

@Jay Hinrichs Yes that’s true, most if not all of what I saw out there was slab on grade, we hardly do any of that out here. And I agree, I don’t think it’s a bad option, we just would need to change our current building philosophy to make it happen. I would be curious what costs come in at, though I know everything varies by area. I’m constantly trying to figure out ways to provide more affordable housing options out here...I hope it’s still possible.

my first one is looking like about 80 bucks a foot.. keep in mind permits are next to nothing compared to our area . and these are not up graded they are builder grade all the way.. starter houses that sell for 210 to 230k a copy.

I assume so, but I have to ask. Is 80/foot materials only? Also are you doing these with your own crew, hiring local contractors, or a blend? Thanks Jay!

0 Votes

@Christopher Smith Charlie Munger agrees with you on BABA:
https://www.barrons.com/articl...

0 Votes

@Christopher Smith Alibaba just took a big hit from the gov. Do you have thoughts on its future?

0 Votes

I'm considering starting a construction business as an owner/manager (not a laborer). Possibly specializing in something like drywall.

1. How can skilled laborers be found?

2. How can skilled laborers be kept?

0 Votes

Originally posted by @Jay Hinrichs:

Originally posted by @Greg Dickerson:

Originally posted by @Mayer M.:

Hey!

So how is everyone handling the increased development costs, particularly the dramatic increase in lumber prices?

I have started to see people put projects on hold hoping that material costs come down, but will they? And if so, will it be enough to make a dent?

Personally, I believe lumber costs will continue to rise especially once inflation begins to set in.

I am slated to begin a new construction multi family project and the lumber costs are about $200k more than they would’ve been a year ago. The way I see it is since everything is already lined up and ready to go there’s no sense in pausing with the hope I can build for cheaper in a year.

What are your thoughts?

Lumber prices will come down when demand eases as interest rates rise. Many builders and developers are tabling projects due to cost. The decision to move forward is all about the numbers. Rates are still low so it may be a wash compared to lower prices when rates were higher. If you are in a position to wait that may be the best bet for you. If the deal still works then go for it.

I had a sit down with our appliance provider ( ferguson) last week.. refrigeration is very tough we can no longer order ANY as a builder.. he said the big MF projects are scrambling he had a container of apartment refers go missing cant rent with no refer.. LOL.. also for high end Wolf sub zero is 6 to 9 months out right now.. so i have two high ends going on for me and one to sell and I have to order my wolf and sub zero now.. or go shopping on craigslist :) seems like in our little world of SFR so far the pass through has worked but when you have a project of 250 units new build started 3 years ago at one budget number and the lumber was going to be X and its now triple of X but the rents have not gone up or in some A class at least on the East side of PDX it has gone down.. proforma's are going to suffer.

Thanks Jay for the specific insight. Any idea if material prices will return to pre-pandemic levels?

0 Votes

@Christopher Smith

You're warning about patience is a good one. Warren Buffett had this to say about it:
"The stock market is a device for transferring money from the impatient to the patient."

I've scanned some of the Chinese stocks and may consider placing a small amount into them. Is VIPS the one you are referring to that dropped dramatically at the end of March?

0 Votes

@Christopher Smith Excellent post. I know you are familiar with compounding interest, but I thought I would share an example of the amazing effect of interest rate on returns. These are three hypothetical examples at 5%, 10%, and 20% APR for 30 years with an annual contribution. In the examples below the only variable that changes is the %APR.

Initial investment=250k, Annual Contribution 100k, APR 5%, 30 year total - $8,056,564

Initial investment=250k, Annual Contribution 100k, APR 10%, 30 year total - $22,456,693

Initial investment=250k, Annual Contribution 100k, APR 20%, 30 year total - $201,169,866

Historically, there have been extended periods of 10 years or more of low or no returns in the stock market. Therefore the only way to achieve high yield has been careful stock selection or investing heavily at dips. Considering we are not in a dip, I am forced to either 1. wait for a dip, or 2. make careful stock selections. This is why I am on the lookout for good stocks that can ideally return 20% or more.

0 Votes

@Christopher Smith Are you familiar with the website "Tip Ranks"? It is a website that congregates multiple analysts' ratings and price targets for various stocks. Do you have any thoughts/opinions on this site?

0 Votes

All Forum Posts by: William Coet

William Coet has started 207 posts and replied 570 times.

Post: Top 5 best multi family markets

Post: how do you switch back to the old format this facebook look sucks

Post: How are you dealing with increased costs to build?

Post: Real Estate or Stocks. Same ROI, Which is Better For Taxes?

Post: Real Estate or Stocks. Same ROI, Which is Better For Taxes?

Post: How to Find Skilled Construction Employees

Post: How are you dealing with increased costs to build?

Post: Real Estate or Stocks. Same ROI, Which is Better For Taxes?

Post: Real Estate or Stocks. Same ROI, Which is Better For Taxes?

Post: Real Estate or Stocks. Same ROI, Which is Better For Taxes?