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this article about consolidation in housing market deserves a separate thread
Poast new message in this thread
Date: February 28th, 2021 11:33 AM Author: Black temple a lot of it we knew was happening, but it covers a lot of the mechanics about who and how and why
https://americanaffairsjournal.org/2021/02/wall-streets-rental-gambit/
biggest shock for me was the lowish yields. They bought a place for $208k that they also did some refurbishment in, and the asking rental price when it was finished was only $1575
considering expenses and all that, seems like not a great return
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Date: February 28th, 2021 11:40 AM Author: Cream newt Assuming 65% NOI margin it’s a 5.91% cap. With rent growth and big compression from rolling these up that’s fine. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022660) |
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Date: February 28th, 2021 11:50 AM Author: motley ivory sanctuary How did you come up with 7.15 (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022702) |
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Date: February 28th, 2021 11:56 AM Author: Cream newt I fucked it up. Edited above (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022729) |
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Date: February 28th, 2021 12:05 PM Author: motley ivory sanctuary That seems like a pretty mediocre return. And you ignored renovation costs plus all the fixed costs these companies have (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022767) |
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Date: February 28th, 2021 12:40 PM Author: balding abode karate Rental housing has been yielding a return of ~4% since 2005ish. It's been a shit investment v. stocks for over 15 years now. It only made sense relative to bonds. This is why there is a shortage of entry level housing in the first place. Its not where you want to put your money. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022919) |
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Date: February 28th, 2021 12:41 PM Author: lemon address Leverage leverage leverage leverage leverage leverage leverage leverage leverage (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022920) |
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Date: February 28th, 2021 12:43 PM Author: motley ivory sanctuary The leverage actually doesn’t help much unless the property appreciates.
All of the rent returns go to interest whoopdeedoo |
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Date: February 28th, 2021 12:46 PM Author: lemon address You clearly don't know what you're talking about. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022942) |
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Date: February 28th, 2021 12:46 PM Author: motley ivory sanctuary Yes I do (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022944) |
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Date: February 28th, 2021 12:47 PM Author: lemon address If the property value merely keeps up with inflation, and your income merely covers all your expenses and nothing more, if you are leveraged, you are going to make a great return.
In reality, in the past 10 years, property values have gone up a fuckload, and these people have made an absolute f****** killing |
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Date: February 28th, 2021 12:48 PM Author: motley ivory sanctuary I mean sure if you have 5% down but then your income won’t actually cover your high interest and other expenses (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022953) |
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Date: February 28th, 2021 12:51 PM Author: lemon address How the numbers play out exactly depends a lot on the market. But generally speaking what these investors will do, is get a 10-year interest only loan, with very low monthly payments, and with something like 20% down. They will be cash flowing well because of the interest only payments and also getting back all of the appreciation. And in the past 10 years or so, they've been refinancing these every 2 to 5 years. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022962) |
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Date: February 28th, 2021 12:54 PM Author: motley ivory sanctuary Doesn’t sound that profitable. Interest will still be fairly high.
Would love to see a calculation showing otherwise. But my guess is best case you are getting 8% when all I said and done.
It’s done well recently because housing prices have gone up so much. Dumb to think that’s definite in the future. |
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Date: February 28th, 2021 12:55 PM Author: lemon address I'm telling you, with 100% certainty, that this is how sophisticated real estate investors do it, at least in big cities. this isn't a discussion, I'm telling you exactly how the most sophisticated people who make the most amount of money do this. if you can't figure out the numbers, that's your problem. But this is how it is done, and, at least in the recent past, it has been extremely extremely extremely profitable. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022985) |
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Date: February 28th, 2021 12:55 PM Author: motley ivory sanctuary I’m not arguing that that’s not how they do it.
I’m saying it’s just not any better than the stock market unless it’s a big company (relatively) with tons of efficiencies,
It’s a stupid investment for an xo poaster.
And yes it’s been extremely profitable recently. But 10-15 years ago they all went bankrupt. |
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Date: February 28th, 2021 12:58 PM Author: balding abode karate TCR. You cant assume values will keep appreciating. I fully understand the play on leverage but the reality is rents havent tracked up with purchase price appreciation. When the rent roll returns 4-5% -- that's a shit investment. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022994) |
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Date: February 28th, 2021 1:00 PM Author: lemon address I feel like I'm talking to retards. I'm now understanding why the Jews think the goyim are so damn stupid. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023004) |
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Date: February 28th, 2021 12:59 PM Author: lemon address Not true at all. I own two rental condos that I've made an absolute killing on using this strategy, but the only exception being that I don't have interest only loans on them. And even if rents go down so I'm not cash flowing at all, and as long as the value keeps up with inflation, because I'm leveraged I will make way better returns than the stock market. as of now I've made insanely better returns than the stock market. Not even close, and that's with the stock market booming over the same time period (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022999) |
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Date: February 28th, 2021 1:02 PM Author: motley ivory sanctuary You won’t admit it here but you’ve only made a killing because the value has gone up dramatically.
No one investing now should plan on that.
People like you lost it all in 2008 |
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Date: February 28th, 2021 1:05 PM Author: lemon address It's true that the outrageous returns I've got him are only because the value boomed. However even if the value merely keeps up with inflation, as long as you're not cash flow negative, you will make a good if not great return.
The basic math is simple.
If you are covering your costs with your cash flow, and you are leveraged, with let's call it 20% down, your return will be 5x whatever the inflation is.
And in reality, it's probably safe to assume, that even if housing values don't keep booming, they will at least keep up with inflation. That might not be true in our country. But it's a pretty safe bet in good areas. |
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Date: February 28th, 2021 1:08 PM Author: motley ivory sanctuary What you don’t factor is that if housing prices dropped by 10% you’d lose 50% of your investment.
Retarded not to take that into account.
Leverage is great until you have to go bankrupt |
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Date: February 28th, 2021 1:09 PM Author: balding abode karate TCR (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023033) |
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Date: February 28th, 2021 1:05 PM Author: balding abode karate Guy who doesnt understand that when rents yield a 4% ROI his property cant possibly continue to appreciate. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023018) |
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Date: February 28th, 2021 12:50 PM Author: balding abode karate My understanding from having a bunch of uncles in this business is that most developers investing in single family are not even going to banks -- too much risk. The mom and pop developer who does lets say ~6 units a year is mostly doing it out of pocket. If he needs to pay any interest at all his margins are so thin as to not make it worth it at all. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022960) |
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Date: February 28th, 2021 12:51 PM Author: lemon address I can't speak for Are country prole real estate investing. But sophisticated big city heavy hitting Jew real estate investing is a play that is all about the leverage. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022966) |
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Date: February 28th, 2021 1:00 PM Author: balding abode karate And now that Manhattan prices are off double digits good luck to those bros. If they werent at least geographically diversified with projects in Brooklyn/Queens LJL at them. MFH real estate is now basically in shotgun in mouth territory (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023006) |
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Date: February 28th, 2021 1:10 PM Author: motley ivory sanctuary I wonder if this idiot knows how often all these real estate dudes end up bankrupt (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023040) |
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Date: February 28th, 2021 2:14 PM Author: balding abode karate Guy who thinks the average real estate investor can get out of granting personal guarantees the way a billionaire like Donald Trump can. LJL. Duders with $10 or $20 million in this game dont get to pull a Trump. If they file their lives are OVER. There are different rules for mere millionaires v. billionaires. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023290) |
Date: February 28th, 2021 11:37 AM Author: Irradiated Turdskin Masturbator #.YDZVI8HxjbA.twitter is there to help track you. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022649) |
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Date: February 28th, 2021 11:38 AM Author: Black temple edited (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022653) |
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Date: February 28th, 2021 11:58 AM Author: Aphrodisiac incel sad (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022739) |
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Date: February 28th, 2021 12:01 PM Author: Marvelous Seedy Location Wagecucks reminder: when some hooknose begins talking about how xo is so crazy for thinking that the idea that the stock market is reflective of economic improvements is 100% bullshit (http://xoxohth.com/thread.php?thread_id=4775203&mc=28&forum_id=2#42014309), this is the sort of "growth" they're talking about thats actually going on (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022751) |
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Date: February 28th, 2021 12:06 PM Author: motley ivory sanctuary Those 2 things aren’t really linked (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022776) |
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Date: February 28th, 2021 12:03 PM Author: topaz den (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022757) |
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Date: February 28th, 2021 12:07 PM Author: naked bbw no ownership, no retirement, eat the bugs, consume the interracial porn (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022777) |
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Date: February 28th, 2021 12:09 PM Author: Marvelous Seedy Location Wagecucks (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022782) |
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Date: February 28th, 2021 12:54 PM Author: Odious headpube (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022982) |
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Date: February 28th, 2021 3:36 PM Author: Black temple (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023652) |
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Date: February 28th, 2021 12:07 PM Author: Twisted Talented State Pozpig We knew about this like 2 years ago, this article was nothing special. Sincerely, hth (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022778) |
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Date: February 28th, 2021 12:08 PM Author: motley ivory sanctuary Will be interesting in a few years when these shoddy built homes require real renovations.
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Date: February 28th, 2021 3:39 PM Author: Black temple I don’t think Wall Street has any issue with being slumlords (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023686) |
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Date: February 28th, 2021 12:39 PM Author: topaz den what i have not seen discussed here or in the article is that now that wall st has made a bet on the profitability of rent homes, wall st lobbyists will likely pay congress to do whatever is needed to suppress the building of new homes...thus putting a lid on supply... (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022913) |
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Date: February 28th, 2021 12:44 PM Author: Excitant library prole This is not necessarily a bad thing. We should protect our wilderness and make cost of living as high as possible to disincentivize mass migration to our former nation. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022934) |
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Date: February 28th, 2021 12:45 PM Author: motley ivory sanctuary Nah construction is way too important to the economy (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022937) |
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Date: February 28th, 2021 12:58 PM Author: Vigorous Heaven They don't even need to do that, it's mostly local councils and they can easily rile up all sorts of retard activists to block new construction. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022992) |
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Date: February 28th, 2021 1:07 PM Author: topaz den (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023026) |
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Date: February 28th, 2021 3:40 PM Author: Black temple (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023693) |
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Date: February 28th, 2021 12:49 PM Author: Bearded french chef the middle class is never coming back. (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022955) |
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Date: February 28th, 2021 12:57 PM Author: exhilarant spruce shrine cr (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42022989) |
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Date: February 28th, 2021 2:09 PM Author: wonderful lavender forum kitty cat (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023275) |
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Date: February 28th, 2021 3:40 PM Author: Black temple we all knew this but now we see a major part of making that happen (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42023695) |
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Date: February 28th, 2021 5:36 PM Author: Black temple sent the article to my brother. he said he’s recently got an unsolicited offer for a crazy high price from Berkshire Hathaway Realty Lmao
average house in a nondescript suburb. 3 of his neighbors sold recently for all cash but he’s not sure to whom |
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Date: March 1st, 2021 8:58 AM Author: Bonkers institution I did make its own thread but no one responded :( (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42027252) |
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Date: March 1st, 2021 10:51 AM Author: Black temple you lack gravitas it would seem (http://www.autoadmit.com/thread.php?thread_id=4776469&forum_id=2#42027717) |