All Forum Posts by: James Park

I am a big demographics guy and the numbers / data is what speaks to me. Below are the numbers for population growth from 2010 - 2014. For large metro cities with a population greater than 2M, I believe Pittsburgh and Cleveland are at risk from a population inflow stand point. Cleveland has a net outflow of 13,642 with the metro population of 2.3M.

I think inventory of their perspective markets - supply and demand is what everyone should be looking to forecast where their housing market is moving. I live and invest in the Atlanta market and we have seen 327,595 net population inflow between 2010 - 2014. Back in Sept 07 right before the crash, the inventory levels in metro Atlanta was 138,442 and today that inventory sits at 41,383 as we are currently very close back to the 2007 levels. Information tells me that the builders cannot build fast enough to accommodate the demand of housing. In the Atlanta market, I do not see a bubble yet until I see the inventory levels back up to the 130k - 140k range.

For those of you BP investors who at the $100k passive income level after expenses. What type of property class did you start out with and end up with to reach this level. I am also interested to know how many of you started out with Single Family Home investments and exchanged to a different property type to reach the $100k passive income level. For those of you who care to share,  what is your yield on your real estate equity vs the $100k passive income. 

For example, if you own 10 single family homes free and clear valued at $1,388,888 and your net passive income is $100,000 your yeild is 7.2%.

Question to those in the $100k passive income club: 

I started out with single family home / Townhome investments and ended up with the following property type: 

A)  Multi-family / Apartments
B)  I started out with Single Family Homes and still own Single Family Homes that currently nets me $100k passive income.

C) Commercial Investment : Office / Retail / Industrial etc. I have started out investing in Single Family Homes and have exchanged all of my single family homes for commercial investment properties that generates $100k in passive income

D) I no longer buy and hold. I have sold off all of my single family home investment properties and now hold only notes that yield me $100k passive income a year.

E) Other..... Self Storage etc.

For a long time, I envisioned my end game to own 10 Single Family Homes in "A" neighborhoods and eventually own them free and clear and retire off of the passive income.

Lately, I have been thinking about what is next after Single Family rentals. I don't think I want own any commercial investments as the commercial sector is heavily influenced by the ups and down of the economy unless I can get a retail strip for a steal and use it for the purposes of housing my own business, leasing out the other units. I see a few commercial buildings (office / retail) sitting empty for 4 years now within 30 minutes radius from where I live. 

The viable option that seems more promising for my investment goals after single family is to either build an apartment complex or build a strip 4-6 townhomes for the purposes of renting. I am leaning towards this path, rather than the commercial when I am ready to graduate from single family homes. I am not really interested in multi-family (duplexes, triplexes, etc. ) as these properties tend to attract lower quality tenants and also located in less desirable neighborhoods in my neck of the woods.

Question.

Anybody here actually building apartment complexes and townhomes for the purposes of holding them as investments? What type of capital is needed to be developing at this scale for an individual investor?  

Thanks,

James

I also think Personal Capital is awesome for tracking your net worth. I have had a spreadsheet since I graduated from college and tracked my net worth on a weekly basis every Monday at 7pm. I would have to login into 12+ accounts. With Personal Capital, there is just one login for all your mortgage, bank accounts, brokerage accounts etc.

Today, I use both the traditional spreadsheet method paralleled with Personal Captial.

These are the three things I try to track on regular basis in my life.

1) Networth

2) Life Goals : Business, Family, Personal etc.

3) Weight / Fat % content 

@Vincent Crane,

I don't know about the other markets, but here in Atlanta, I don't think we will ever reach that 2012 (1996 levels) again.

In terms of the stock market 2016 is a significant year as 75 million baby boomers will turn 70 and will be forced to pull money out of their pension plans. This why i think 2016 will be a very very important year for the markets. IF and WHEN there is a full blown blood in Wall Street (... and we not there yet), you need to have your powder dry and be ready for this incredible opportunity as an investor when the whole world will be on SALE.

@Vincent Crane,

I see that you are from Atlanta. Back in 2012, only 3 years ago, homes in Atlanta were trading at 1996 levels. It was a no brainer for me back then that I must buy as many new homes I can afford in the best schools zones in the wealthiest county in Georgia. I will hold onto these investments forever into retirement.

IF and WHEN the DOW Jones or S&P crashes down to 1996 -1997 levels, that would be approximately 6800 on the DOW and 750 on the S&P.

I know that many of you will think this is silly, ridiculous, and impossible, but I hope that you and I are smart enough to inject some serious capital into the S&P IF and WHEN this happens. You will then be able to close your eyes and enjoy capital appreciation for the next 18 years.