Real Estate

[chassis]

Originally Posted by ASAP

dont know about you guys but the RE market in Miami is borderline sham levell... 300k condos in key areas rent for 2k a month... some are sub 800 sq ft. To buy your mortgage payment would include a $500 a month HOA, taxes and upkeep... if you were to rent that for 2k, you are already upside down monthly. As far as buying out of the city, be prepared to deal with monstrous traffic to get from a 30 year old house that looks like a shack for 300-400k... timing is awful right now.

ASAP, what are the annual property taxes on the $300k, 800sf condo in Miami?

[ASAP]

Originally Posted by chassis

ASAP, what are the annual property taxes on the $300k, 800sf condo in Miami?

more or less $3k

[Joekerr]

Originally Posted by Kelse92

Oh yeah, it’s all a sham. Typically like the Property Brothers, the people have already bought their house. The whole “house hunt” part is always staged.
In terms of the construction, I think Chip does actually have a crew that does stuff and he is somewhat handy himself and can do some construction projects if he wanted to, but I’m sure he just has a crew working on it. So they may be more genuine than the property brothers who literally were stand up comics or magicians or something like that before the show.
I will say though, their market prices for the houses are definitely pretty real. Waco TX is pretty inexpensive housing. It’s a cute place but not a hugely desirable place to live. it’s not a city that’s really close to anything unless your business or job is located there. It’s 1.5 hours from Austin or Dallas. However, because of that, a house built in the 90’s with an acre or two of property is totally realistic for sub-300k. But it’s not a place you could pay me to live personally...
The show however has helped the city a TON in terms of tourism.

Thanks - I kind of suspected the house hunt was a sham and wondered about the rest, but nice to hear confirmation. But I have to say, the final product looks really nice, at least I always seem to think so. Can't say the same about the property brothers (its ok).

On a different note - you should share some of the wildest stories you've come across as a realtor. I suspect the wildest stories I could ever expect to hear would come from say a pharma sales rep or a medical equip sales rep...not sure why, I just know a few doctors and I think that anyone doing those sorts of sales to doctors probably have a few wild stories to share, so not sure if the realtor stories could match that, but I always love a good story!

I do have to say with the docs I know, its funny, on the outside if you were to see them professionally, they look and act very serious and professional and seem like upstanding citizens. But you get to know them personally and hang out with them - they are pretty funny and pretty wild. I was on a brewery tour on a bus full of docs, and my neighbour (who is a doc) starts passing out these pills to us before we get on the bus, apparently these help to reduce hangover feelings the next morning. I wasn't taking it until I knew what it was, but I was the only one that asked. Probably the rest of them knew what it was. Then on a different bus ride, one of the docs had weed that he was bringing across the border (before it was legal on either side) when they were going to go down and watch a football game...also very stupid of him, but you get the picture. I always smile thinking of the dichotomy of how I know them vs how other people see them.

But yeah, medical sales rep or pharma sales rep - I'm betting they have stories. I think there is only one member on here that I know of that did pharma sales.

[spazzyfry123]

A year later and a new president-elect. Where's everyone stand on real estate?

We purchased a home in February in a highly desirable neighborhood with the intention of making it right for the next owners in a relatively short period (<5 years). Between closing and real estate costs, we'll come ahead and be better off than if we rented here (wild market in this town). Closed on it pretty much immediately before the covid hype. Extremely speculative at this point given a potentially much different economic climate on the horizon, but I feel $/ft just keeps rising which puts us in a good spot as, effectively, house sitters.

From here, our next move has us more than likely purchasing acreage in a desirable area in the mountains near lakes for my parents to build their forever home on with our primary residence being a cookie-cutter 3/2 suburbia McNormal closer to work needs as a toss up on rent vs buy.

Trying to keep this politics-free, what are your ideas and moves going into 2021 for real estate investments?

[chassis]

Residential real estate is in the early stages of a multi-year strong period.

Single family homes have been underbuilt from the GFC until the 2018-2019 period. Single family home construction should be strong for several years, at least. Pricing on new construction should be firm. Pricing on existing homes should be firm because many people don't want the hassle or don't want to/can't wait for a home to be built.

When I say pricing should be "firm", I am hedging because I think pricing will see moderate to strong increases.

I don't see the economic climate changing because of an election. The economy was strong before the "events" early this year, is currently strong, and will be strong for the foreseeable future. It's because of population growth, accentuated by low interest rates.

Consumer spending never truly softens, it only increases. This is what drives the economy.

[TrevorM3]

hopefully we crash. pick up 1 or 2 more rentals.

[M_Six]

Since we're talking real estate again, here's a question. My neighborhood is mostly 1 acre lots. We're in a township, so there are no setback rules or even any codes to speak of. My neighbor to the south originally bought the lot between his house and the house we bought so he wouldn't have a house right next to his. So there's an acre lot, mostly wooded, between our house and his. He died several years ago, but his wife, who is sadly suffering from Alzheimer's and is in long-term care, is still the owner. At some point, his son will probably sell the property as he lives out of state. I've considered asking him for right of first refusal on the open lot if he's willing to sell it. I don't want a house right next to us either.

So my questions is, how do you value something like that? If I buy the lot, I'd be out the cost of the purchase, plus the yearly real estate taxes (which are high here). I realize there is a intangible benefit here which is hard to quantify (privacy). But are there other considerations I'm missing? We have no plans to sell or move. We've pretty much decided to retire right here, so I'm guessing recouping the cost of the purchase and subsequent taxes will not be a consideration. There is a 1/4 acre or so of grass which abuts to our lawn, so mowing will be more extensive, but otherwise I don't see a big jump in upkeep. Like I said, it's 90% wooded. I'm very roughly guessing a purchase price in the $10k or under range. The lot is build-able (water and elec).

Thoughts?

[MaC-N54-E82]

Originally Posted by M_Six

Since we're talking real estate again, here's a question. My neighborhood is mostly 1 acre lots. We're in a township, so there are no setback rules or even any codes to speak of. My neighbor to the south originally bought the lot between his house and the house we bought so he wouldn't have a house right next to his. So there's an acre lot, mostly wooded, between our house and his. He died several years ago, but his wife, who is sadly suffering from Alzheimer's and is in long-term care, is still the owner. At some point, his son will probably sell the property as he lives out of state. I've considered asking him for right of first refusal on the open lot if he's willing to sell it. I don't want a house right next to us either.

So my questions is, how do you value something like that? If I buy the lot, I'd be out the cost of the purchase, plus the yearly real estate taxes (which are high here). I realize there is a intangible benefit here which is hard to quantify (privacy). But are there other considerations I'm missing? We have no plans to sell or move. We've pretty much decided to retire right here, so I'm guessing recouping the cost of the purchase and subsequent taxes will not be a consideration. There is a 1/4 acre or so of grass which abuts to our lawn, so mowing will be more extensive, but otherwise I don't see a big jump in upkeep. Like I said, it's 90% wooded. I'm very roughly guessing a purchase price in the $10k or under range. The lot is build-able (water and elec).

Thoughts?

For $10K I see zero downside. That seems incredibly inexpensive for a 1 acre buildable lot.

[M_Six]

Originally Posted by MaC-N54-E82

For $10K I see zero downside. That seems incredibly inexpensive for a 1 acre buildable lot.

We're talking east central IL. Many houses here sell for well under $100k. The lot may go as low as $5k. But point taken.

[kscarrol]

For the piece (peace?) of mind I would buy the lot. Even high property taxes on a $10k lot can’t be that high.

[vreihen16]

Originally Posted by M_Six

So my questions is, how do you value something like that?

Did you check the assessed value of the lot with whatever government department handles property taxes? In our town (NY State), it seems to run about 1/3 of the market rate and would be the low-ball offer.

Did you pull "comps" out of Zillow for similar lots in town? Around here, those would be the high-ball offer.

My $0.02 is to deal with the owner while he/she is still alive, if at all possible. Tell them that you wish to honor their intent to keep that lot vacant. Once the owner dies, many estate executors only see dollar signs from liquidating the assets assuming none of the relatives want the house. Even then, the estate might sell the lot out of spite (or as a settlement) if one party wants the house.

Crazy idea #1 - Can the lot be sub-divided into two non-buildable pieces? Buying the half closest to you is your insurance, and keeping the other half is the neighbor's insurance.

Crazy idea #2 - I'm on a town committee here that's re-writing our master plan. A popular thing here is the purchase of development rights (PDR) on vacant land, mostly farms. The owner gets paid for the development rights, but retains ownership and can keep on using (or even sell) the land...as long as it is only used for the current use and not developed. This is mostly used by non-profit land banks and other "green space" groups, but seems to be an option in your case.

Speaking of insurance, my parents had a wooded buffer lot next to their last house. When my mother sold the house, she kept the lot. The cityiot who bought the house installed a monster wood stove to heat the place, with no spark arrestor. Long story short, a spark from the chimney started a small forest fire on my mother's lot in the middle of the night. The local fire department and state forest rangers squashed it in a few hours, with no property damage besides trees. Guess who received the fire-fighting bill from the state...for many time more than the lot was worth? Long story short, don't forget to factor insurance into your purchase!

My favorite crazy idea for protecting a buffer lot came from a local lawyer. His grandmother lived in a house in a popular beach resort town. Her house had a wooded buffer lot, and his aged grandmother used to like sitting by the windows watching the squirrels run around the lot. The vulture relatives were circling grandma trying to force her to sell the lot to a builder. The grandson lawyer stepped in, having the lot declared a state squirrel sanctuary so that it couldn't be built on and grandma could continue to watch the squirrels for the rest of her life.....

[chassis]

Originally Posted by M_Six

Since we're talking real estate again, here's a question. My neighborhood is mostly 1 acre lots. We're in a township, so there are no setback rules or even any codes to speak of. My neighbor to the south originally bought the lot between his house and the house we bought so he wouldn't have a house right next to his. So there's an acre lot, mostly wooded, between our house and his. He died several years ago, but his wife, who is sadly suffering from Alzheimer's and is in long-term care, is still the owner. At some point, his son will probably sell the property as he lives out of state. I've considered asking him for right of first refusal on the open lot if he's willing to sell it. I don't want a house right next to us either.

So my questions is, how do you value something like that? If I buy the lot, I'd be out the cost of the purchase, plus the yearly real estate taxes (which are high here). I realize there is a intangible benefit here which is hard to quantify (privacy). But are there other considerations I'm missing? We have no plans to sell or move. We've pretty much decided to retire right here, so I'm guessing recouping the cost of the purchase and subsequent taxes will not be a consideration. There is a 1/4 acre or so of grass which abuts to our lawn, so mowing will be more extensive, but otherwise I don't see a big jump in upkeep. Like I said, it's 90% wooded. I'm very roughly guessing a purchase price in the $10k or under range. The lot is build-able (water and elec).

Thoughts?

Are you in a subdivision?
What utilities are provided to your home? Natural gas, city water, city sewer?
Do you have an HOA?
Is your title or deed identified as a "detached condominium"?
Do you have any type of relationship with the current owner? Or are you total strangers to one another?

Valuation approaches:
- look online at Zillow or realtor.com or craigslist for 1 acre buildable parcels for sale in a subdivision or neighborhood comparable to yours. The key is "comparable to yours". 1 acre carved out of the center of a corn field with no utilities or access will be valued much differently than a neat and tidy immediately buildable lot with paved streets, sidewalks, street lights and a nature trail nearby.

- look at your local taxing authority's website for their valuation of the land portion of your home+land, and the elderly woman's (neighbor's) home+land. The parcel value you seek to buy will have some relevance to these numbers.

- ask the elderly neighbor/current owner or her estate's trustee or executor, what price they would sell you the land.

[MaC-N54-E82]

Originally Posted by chassis

Are you in a subdivision?
What utilities are provided to your home? Natural gas, city water, city sewer?
Do you have an HOA?
Is your title or deed identified as a "detached condominium"?
Do you have any type of relationship with the current owner? Or are you total strangers to one another?

Valuation approaches:
- look online at Zillow or realtor.com or craigslist for 1 acre buildable parcels for sale in a subdivision or neighborhood comparable to yours. The key is "comparable to yours". 1 acre carved out of the center of a corn field with no utilities or access will be valued much differently than a neat and tidy immediately buildable lot with paved streets, sidewalks, street lights and a nature trail nearby.

- look at your local taxing authority's website for their valuation of the land portion of your home+land, and the elderly woman's (neighbor's) home+land. The parcel value you seek to buy will have some relevance to these numbers.

- ask the elderly neighbor/current owner or her estate's trustee or executor, what price they would sell you the land.

Or just drop the $10K. Seems cheap relative to piece of mind.

[pukicabuki]

A 1-acre level buildable lot is $500k around here. Pay the $10k and never look back.

There is a 5,200 sq/ft lot in some crappy little subdivision not too far from me that is selling for $230k.

[chassis]

@spazzyfry123 Have you stated on this thread that the empty parcel is, in fact, offered for sale? Either publicly or privately through speaking with the owner? Have you posted comparable values on this thread for the parcel? Are you sure $10k is what the average seller would accept for a property like this?

“Dropping $10k and not looking back” is irrelevant if the property is not, or will not be, offered for sale.

[Kelse92]

Originally Posted by chassis

Residential real estate is in the early stages of a multi-year strong period.

Single family homes have been underbuilt from the GFC until the 2018-2019 period. Single family home construction should be strong for several years, at least. Pricing on new construction should be firm. Pricing on existing homes should be firm because many people don't want the hassle or don't want to/can't wait for a home to be built.

When I say pricing should be "firm", I am hedging because I think pricing will see moderate to strong increases.

I don't see the economic climate changing because of an election. The economy was strong before the "events" early this year, is currently strong, and will be strong for the foreseeable future. It's because of population growth, accentuated by low interest rates.

Consumer spending never truly softens, it only increases. This is what drives the economy.

Respectfully, I disagree. And it has nothing to do with the election. I'm seeing a huge backlog of people in default on their notes in the foreclosure space I mainly work in. We used to see on average 400 units on the county pre-foreclosure list here in Dallas and 50-60 of those would get foreclosed on. Lately, due to moratoriums on foreclosures and people that took forbearance those numbers have been closer to 100/mo with 20 or less getting foreclosed on. Short-term its squeezed investment numbers and margins super tight and just as a whole in the retail market here inventory has been down and multiple-offers on houses are everywhere... BUT, there's at least 3000 units in the queue of backlog if not more based on last year's averages.
When I attended the auction last week, my sources in the lending community were saying they think the actual numbers of people in default once the moratoriums and forbearance end may end up in the 10,000+ unit range. There's already agents I know asking in various local RE groups I'm in what to do because their client's forbearance period is ending and the bank is making them pay-up now or do a loan-modification not putting the owed balance on the end of their loan without penalty like many thought would happen.

I do agree that construction has slowed, but building materials are a mess right now and driving up prices like crazy. It's going to squeeze a lot of buyers out of the affordability pool for those and I think single family pre-owned inventory is going to rise.

[spazzyfry123]

Originally Posted by chassis

@spazzyfry123 Have you stated on this thread that the empty parcel is, in fact, offered for sale? Either publicly or privately through speaking with the owner? Have you posted comparable values on this thread for the parcel? Are you sure $10k is what the average seller would accept for a property like this?

“Dropping $10k and not looking back” is irrelevant if the property is not, or will not be, offered for sale.

I think you may have tagged me in error. I believe this was intended for M_Six

[M_Six]

To answer a few questions:

1. I don't know the status of the property. The owner (husband) died maybe 7 or 8 years ago and the house has been empty since then. There is the surviving wife, who is sadly a long time Alzheimer's victim. Their sole surviving son lives in Texas and I have no way to contact him. There are some folks who come around to the property every now and then to do maintenance, so the next time I see them, I'll give them my contact info and see if the son will contact me.

2, My only interest in the property is as a buffer to prevent someone building a house right next to mine. The property is an acre, but only about 1/4 of it is buildable. The rest is a steep, wooded hillside. The buildable part is right next to my house and there are no setbacks here. A house *could* literally be built at the base of the steps leading off my deck. Hence my interest in the property.

3. I'm guessing about the price, but based on the fact that this lot only has a small buildable area, I'd be surprised if it's valued over $10k.

4. I'd considered the added real estate taxes this would encumber, but I hadn't thought about the insurance angle. Thanks for that heads-up. I'll have to look into that.

If the son decides to keep the property as is, I'm fine with that. I have no real need to own the lot beyond the aforementioned privacy factor. I'd just like to have right of first refusal if he decides to sell the property or split off the open lot. If he's willing to sell the open lot but wants a fortune for it, I guess I'll have to take my chances that someone else doesn't plop a house on my doorstep, so to speak.

[NorCalAthlete]

For the real estate agents reading this thread:

Why oh WHY do you guys almost never have any pictures of or info on the garage??!!

Next to a house, your car is usually your next biggest purchase.

[vreihen16]

Originally Posted by NorCalAthlete

Why oh WHY do you guys almost never have any pictures of or info on the garage??!!

You're shopping the wrong web site! This one lists garage spaces first, and then mentions the house...if there is a house on the property at all:

https://www.carproperty.com/

[zx10guy]

Originally Posted by NorCalAthlete

For the real estate agents reading this thread:

Why oh WHY do you guys almost never have any pictures of or info on the garage??!!

Next to a house, your car is usually your next biggest purchase.

LOL. I lucked into how my garage is laid out when I had my home built. Many of my neighbors have been jealous as to how I have been able to put in all the stuff I have: storage cabinet, two roll aways, work bench, slop sink, welder, air compressor, and enough space where I can squeeze in two moderately sized cars and 2 motorcycles. All of this in a 2 car garage. Only thing I wish was better is for a 3 car garage option.

[Run Silent]

Originally Posted by spazzyfry123

We've got a group of smart folks here on the forum, and I was surprised to see there wasn't a real estate discussion (at least not that I found). Who on here has purchased land as an investment? Maybe a future retirement spot? What percentage of your gross income does your primary mortgage account for? How do we feel about the current market and its somewhat-immediate future? Prices in Tallahassee seem to have skyrocketed in the past few years for example - selling for 50% more than they did just a couple years ago in some instances - makes a current buyer uneasy.

I sold my home a few years back in Atlanta and we have been renting while we figure out what we want on a personal and career level as well as where we want to be. We've since relocated to the panhandle of Florida and ramped up the decision to buy as we intend to be here for the next five-ish years. We have been thinking to buy a cheaper home here with little money down and use our cash to invest into a lake property in the North Georgia / Tennessee / North Carolina / South Carolina triangle as a place to vacation and park our cash. No clue if it's smart, but it feels right. Trying to be pragmatic. 401k company match is maxed, about six months worth of expenses stashed in case something hits the fan...ready to put the extra into something more tangible and then start the college fund up for the kids that don't exist.

Not intending this thread to be an "answer ME" thread but more of an open discussion. Certainly welcome any feedback, but what have others done? What has been your recipe? What mistakes have you learned from?

Cheers,
Tyler

I generate a decent % of my income from rental properties. Most are overseas. Let me know if you have any specific questions. I am happy to answer what I can.