All Forum Posts by: Will M.

I’ve never bought a townhome but a new home build in Las Vegas probably requires you to finish the backyard within 1 year for about $10k, and includes Sid/lids of about $20k (this was $160/mo for 20 or 30 years on DR Horton new builds up by Aliante.) But 1 or both of these may not apply to townhomes. 

Also check with Hoa to make sure rentals are allowed, I would bet only 30+ days if any are allowed. Find out if the number or percent are capped.  If it’s an in demand neighborhood with waiting lists they usually go with homeowners first. Don’t be surprised about property taxes either. I own several homes worth north of $500k but hv]ave owned them long enough the rate caps have kept me in the $2,400-$2,800 range. I was quoted $7,200 for the $600k new home. 

@Will M. I have rentals in 3 states and watch markets in 1 other. I've noticed a general trend of slowing recently all over, most heavily in California. IMO that's not scary at all. 1. Lending restrictions became VERY (ridiculously) tight in 06 and beyond and have not loosened to pre-06 levels. Banks are GENERALLY lending to people who can actually afford it with solid products. 2. The affordability index is solid. This is a ratio between the median income of an area compared to the median home price. If 20% or less of an areas population can afford to buy a house then you're headed for trouble. In my area of CA for the past 6 months prices have stayed the same or gone down a little but median income has risen. That's an excellent sign. That's what a housing market should behave like. 2006 was not normal. And it extended for so long because there was too much market manipulation. Right now the economy is humming, job movement is high which causes wages at all levels to rise, job creation numbers and gdp are at healthy levels. 3. Construction drives the market and you can't spit anywhere in this country without hitting two new developments. If you're ever not too sure about a market, look at what the big dog builders are doing. They hire swarms of analysts whose entire life is studying trends and markets. 4. You're in Vegas...you are the closest pit stop to the largest market in America (So Cal). CA restrictions and taxes are strangling businesses. NV has some of the loosest restrictions and friendliest taxes. Your CA transplant job market and net migration is high and will continue to be so. 5. Get in the game or you'll be in the nursing home wishing you had!

As the stock market took another hit today, I'm definitely not slowing down on buying real estate. Where should I put my money? In my mattress? I have extra cash right now, and I sure do not want to add it to my brokerage account right now. I'm closing on another duplex here in December. Buy and hold rentals is all I do in real estate at the moment. I'm now looking for a value add/deferred maintenance 8-16 plex. Seems like the prudent thing to do right now. Even if my equity remains at zero for a few years, the cash flowing properties with tenant paying your mortgage, and the tax benefits, will be better than what the rest of my portfolio has done this year. 

Originally posted by @Will M.:

Originally posted by @Dave G.:

I have the funding and am ready to pull the trigger, but have not bought anything in 2018 yet. Having a hard time finding deals where the #s work. 

I'm will go against the grain with most folks and say you can time the market to some degree. I'm not a young person and have seen multiple real estate cycles over the past 40 years. As @Russell Brazil pointed out, if you're in certain parts of the country the cycles are more extreme and can be (admittedly imprecisely) played. My wife and I saw the lunacy in 2004-2006 and sat on the sidelines. We started buying in 2009 with acquisitions nearly ever year since.

Our we in 2008 again? I don't think so for many reasons already pointed out in this thread. Labor supply constraints in the trades is also a big limiting factor to the overbuilding 10 years ago that contributed to the collapse. 

So I am still bullish, but will only buy when the numbers work. 

 Thanks Dave. As this is my first RE investment, I want to maximize my cash flow. If waiting a year means I can save 10-15%, that would be worth it. But as many have pointed out, no one has a crystal ball.

 The housing collapse from a decade ago had a 12% drop nationally. The worst economic crisis of our lives. Expecting a future 10-15% drop in the near future isnt really something you should plan for.

1) look up wherever they file foreclosure/NOD/NOS notices on your county websites/local newspapers

2) Call the owner

Adrienne - 

YES! Have you seen the sales charts for Vegas this past month? We went from 2,600 sales in September to LESS THAN 500 IN OCTOBER! I looked up the 10 year history, and that has not happened in at least the last 10 years. I understand this season gets slow but there is DEFINITELY a market correction taking place right now. Between the price resistance we were already seeing the and interest rates going up for a 4th time this year, the demand for housing has dipped far under the supply. Call your seller and encourage a price reduction. There have been more than 1,200 in the past 7 days. 2 months ago, that number was single digits. 

@Will M. I sell real estate in Las Vegas and while we are seeing a little bit of a slow down these last couple of months in the over 300k price point, I don't think we are at the top of the market and we are still lower than 2006 prices. So many projects are projected for completion in 2020 including the Raiders stadium and now rumors of an MLB stadium where Rio is...I think it will be at least 2 or 3 years before the market stabilizes. https://www.reviewjournal.com/business/casinos-gaming/6-major-projects-could-reshape-las-vegas-strip-skyline-by-2020/

I am still buying like crazy regardless. Just becareful when u buy. I typically paying 70% or less of what a property is worth when I buy. And I don't think this time will drop more than 30%. I will be fine even if the market corrected tomorrow . And I am flipping the low end property. So worse case I can still rent it out for a decent cash flow

I have more than doubled the number of units this year and will try to do the same next year.  If you are in an area with favorable demographic trends (% moving in vs % leaving) and barriers to additional capacity (I am in the greater Portland metro market) combined with very cheap debt if you can get it, and the plan is a non transactional purchase (i.e. buy and hold) then I think that in 10 years I will be looking back wish I had bought more even if there is a rollercoaster in the middle.  The question you ask has been asked probably ever since the bottom of 2008 correction and every year since.  Buy smart, do not over leverage, spend the time looking for deals that do work even if they require more effort.   Rents in a lot of markets went UP as prices went down, and if you are after the rents and do not plan to sell then who cares what the "value" is.