@J. Martin I understand that housing prices usually bottom after the unemployment rate peaks, sometimes even several years after. The thing is, a good friend of mine is on the West Oakland planning commission and he's shown me development plans already approved by the city. I'm sure you know just how big these development plans are... Here is a rendering by China Harbor Engineering Co. of the 8-12 story development which will surround West Oakland BART station.
This is only one of the very large developments set to happen under the West Oakland Specific Plan. There is another development near the abandoned train station on Wood Street, which is already in the construction phase, and even more on San Pablo & West Grand, as well as on 26th & Mandela Parkway. The WOSP also details "transit improvements which are to include enhanced AC Transit bus service, a street car service (stoked about this one) and other approaches, with direct links to planned pedestrian-and bicycle networks, the Mandela Parkway/West Grand Avenue employment and business center, the shopping and other existing amenities at the Oakland/Emeryville city limit line, downtown Oakland BART stations, and Jack London Square."
Below you can get a general idea about where these developments will take place, and how the land use is expected to change from the first "Existing Land Use" map to the "Land Use Overlay" map.
West Oakland has a mere population of 36,223. As seen in the table below, WOSP estimates to create 15,220 jobs within West Oakland alone at buildout (year 2035). Not only that, but the population is expected to grow in response to the Plan by 30.7%, and all these changes will happen incrementally over the next 19 years. How can the unemployment rate not continue to drop and housing prices not continue to rise? I'm sure they will fluctuate, but surely it can't be a bad idea to invest now?
The issue with waiting to invest, in my opinion, that homes are being flipped left and right. A "beautifully remodeled" property selling at market value leaves little room for forced appreciation or cash flow, and soon almost every home in West Oakland will be beautifully remodeled. My friend, Bruce, began investing in West Oakland at the tender age of 18. He is now 50-something years old, owns 40+ cash flow producing properties which he flipped himself, and even he finds it difficult to buy great deals in the area today, as an all cash buyer. The competition for good deals right now is very high, and the available inventory of investment properties is growing smaller. I don't think it will get any easier to invest here in the near or distant future.
West Oakland is definitely a volatile market, but I think it's volatility will decline and West Oakland will become more stable and predictable. Like you said, "the short story is that history says the best time to buy is when unemployment peaks and starts to improve, rather than when unemployment is running down near historic lows." I also believe that although now may not be the absolute best time to invest (8 years ago would have been prime), it is still a good and maybe even great time to invest.
Being a young and rather naive real estate lover and hopefully soon investor, I feel it's nearing my time to take the plunge and take my experiences for what they are: learning experiences! Don't you think? There are no losses when we persist and continue to adapt, and I would hate to wait for the "perfect moment" when I could get my feet wet and learn the waters. :)
Here is the link to the West Oakland Specific Plan Project Description PDF, where I pulled the charts and data from.
http://www2.oaklandnet.com/oakca1/groups/ceda/docu...
What do you think? Would you still recommend waiting, and until when?
@J. Martin
