All Forum Posts by: Shawn Clark

This seems to be a widely held mantra here.  If you buy in a high appreciation market, you're not investing, you are speculating.  That's not something I have ever heard here in Hawaii.  Probably because it's not true!  Hahahaha.  If you know anything about Hawaii, you know to buy as much real estate as you responsibly can.  This has been true since the late 1800s.  But what does history know?  I've been investing since 2002!   ;)

A closer look at Hawaii.  In 1950 the median price of a single family home was $12k.  The median price is now $760k.  So in 67 years Honolulu has averaged just over 6% appreciation per year.  I would image areas like Los Angeles and San Francisco would show similar data.

During the recent recession, most areas in Honolulu dropped around 15%.  Cumulative!  These seem to be pretty solid figures.  In 67 years annual average appreciation of 6%, and only a 15% cumulative drop during the worst financial crisis of our time.  Is 67 years not a large enough data set to have confidence replace speculation?

If 67 years of sales history can't be relied upon, then neither can rent history.  If calculating future appreciation is speculative, then so would calculating future rents, or any rents for that matter.  That's ridiculous.

In other words, just because we've seen something happen for 67 years, doesn't mean it will happen again?  Wow!  Then why even invest?  I mean speculate.   :)

(This is not about appreciation vs. cash flow.  Both are great.  This is about using data to make educated investments and to help dispel poor advice.)

This should be a sticky thread for bright-eyed hopeful landlords wanting to wade into lower end waters!   Not that everyone here has lower end assets, but a lot of the problems outlined (jail, eviction, damage, hoarders, bedbugs/roaches/pests are lower end-esque LOL    @Mindy Jensen  maybe this would a good sticky on the LL forums?  It's not all roses and cashing checks and new folks need to know that.

I too have had more turnovers than I wanted some months.  5 at a time now and then. I knock out the ones left in good shape first and get them re-rented ASAP to help with the 5, 8yr, 10yr ones that need deeper improvement.    I think @Jerry W. has my record beat right now with 3 reno's and another 3-4 turns going on with a full time job and life trying to happen all at once.

Landlording is the only business I know where the harder you work and the more you spend, the less you make. Do that in any other business and it improves your NOI. We are making the most and are happiest when required to do the least. Full and humming along, we are gold!

Thanks everyone for contributing and sharing on this thread.  BP is the only place I know of where others that have faced these same things can empathize, come together, educate and be there for one another.  In real life, very few understand or relate to us on this level!

Hi @Shawn Clark
Are your rental properties in Middle River?
Asking because I own two there.

I googled the unemployment history of US, and here is the chart... Out of the past 65 years, maybe 10 saw unemployment at around 4%....All other 55 years were higher.... If you are buying RE in today's enviroment when unemployment is 4% and interest rate is 4%, you are buying yourself trouble, in my opinion....

As a matter of fact, RE in the Bay Area is slowing down already, in my observation... My favorite example - Redwood City listing prices is now 15% ish lower than what properties have been selling at in the last 6 months... Big signal to me...

Jumping into Real Estate Investing (gotta start one day, right?) and all of the properties that I am interested in are always under contract.  The realtors that are out there, just send partial responses and NEVER follow up to even say "what else are you looking for?".  This is frustrating being a former realtor and I always pride myself on building my database with leads. I would like to start working with wholesalers to possibly get a jump on homes that will not hit the market. I looked on Craigslist, but nothing. I am in the Northen NJ area. Does anyone have any suggestions?

I appreciate all comments.

Aqil Dharamsey

In the last few months I have had bed bugs, roach infestation, tenant eviction, washer/dryer combo broken, and a mold problem in my building in Phoenix.

Every time I thought the worst was over another issue popped up. Fortunately my other properties made up the difference, but I still haven't made money in months there.