Housing cracks: Median OC price drops to 690k (Long Beach, Irvine: 2015, rental)

[leastprime]

Originally Posted by Electrician4you

You serious with this piker crap? Why would I sell a rentals that are cash flowing? Why would I in any way risk the great, very passive income that is nothing but money in the bank. For what?

So I can buy a rental where I gotta throw money at it to keep it going. No thank you. Buying a rental where you're having to support it is the worse investment you can make. Hell at least break even. Equity will do,absolutely nothing for you unless you refi. Better hope those rates are lower in 6-12 months.

How much experience does your son have managing properties?

He's learning. We are learning from him

This Redmond condo will only be rented for 9-12 months. Wife will then move up to Redmond. The rental situation is temporary. We did not buy this for a rental nor for investment but a place to live in. We can cover the shortfall by turning on an annuity that I had planned to satisfy IRA's Required Minimum Distribution for calendar 2017.

[Electrician4you]

Originally Posted by GSR13

Lol, when the housing market crashes, you know those rentals will bring in less cash, right? Funny how otherwise sane and intelligent professional property can be so delusional about their own assets. 1+1=3 with these people. SAD!

Even a 5 year old will tell you to sell at the top of the market. But keep that Hamster spinning, man..Lolzlozlol

What's sad is you are yammering like you know what you're talking about yet are absolutely clueless about my finances or the financial status of my properties. I had absolutely no problem with rents when the market crashed last time or even the time before. Where do you think all those people that got foreclosed on go? Tenants didn't go anywhere. Delusional? Hardly. There is absolutely NO reason for me to sell. The cash flow and the advantages of owning rental properties far outweighs the sale.

Originally Posted by leastprime

He's learning. We are learning from him

This Redmond condo will only be rented for 9-12 months. Wife will then move up to Redmond. The rental situation is temporary. We did not buy this for a rental nor for investment but a place to live in. We can cover the shortfall by turning on an annuity that I had planned to satisfy IRA's Required Minimum Distribution for calendar 2017.

Well that's not what it sounded like. You said eventually you will be moving in it. Eventually could be 12 months it could be 20 years. I don't know when eventually is for you.
You can carry the shortfall as long as you want. It's generally a bad idea to buy a investment property (which is what I thought you were buying) where you have to carry it monthly.

[expatCA]

Originally Posted by GSR13

Lol, when the housing market crashes, you know those rentals will bring in less cash, right? Funny how otherwise sane and intelligent professional property can be so delusional about their own assets. 1+1=3 with these people. SAD!

Even a 5 year old will tell you to sell at the top of the market. But keep that Hamster spinning, man..Lolzlozlol

Nope, as more foreclosures because of a crash, means more people looking to rent since they lost their ability to pay for their home. The demand for rentals does not go down, it goes up.

[leastprime]

Sorry for my earlier interruption. I fat fingered unto OC.
I really should be on the CD's RE forums. The Rentals subforum is downright scary .

[Joe Van Fossen]

Originally Posted by GSR13

Lol, when the housing market crashes, you know those rentals will bring in less cash, right? Funny how otherwise sane and intelligent professional property can be so delusional about their own assets. 1+1=3 with these people. SAD!

Even a 5 year old will tell you to sell at the top of the market. But keep that Hamster spinning, man..Lolzlozlol

I met a landlord a few years ago while helping a tenant into a rental in Irvine. This guy owned four 3-bedroom condos in a Woodbury development that he bought in the 70s for around $40K each. He was retired and at the time he was leasing these units out for $2350/mo. Now they're going for about $2800/mo. That's a passive gross income of $134,400/yr, in retirement. That's on an initial investment of $160K ($627K adjusted for inflation). There have probably been half a dozen or more "top of the markets" since he bought them.

[expatCA]

Originally Posted by Joe Van Fossen

I met a landlord a few years ago while helping a tenant into a rental in Irvine. This guy owned four 3-bedroom condos in a Woodbury development that he bought in the 70s for around $40K each. He was retired and at the time he was leasing these units out for $2350/mo. Now they're going for about $2800/mo. That's a passive gross income of $134,400/yr, in retirement. That's on an initial investment of $160K ($627K adjusted for inflation). There have probably been half a dozen or more "top of the markets" since he bought them.

Wise man for sure in buying and renting the units out.

[expatCA]

Originally Posted by TracerOW

Is that right? I never lowered my rent once between 2005 and now. But thanks for the tip, buddy. How many units do you currently own?

Many hope a crash will make it more affordable for them. How did that work in the last crash?

[CaliRestoration]

Originally Posted by TracerOW

Is that right? I never lowered my rent once between 2005 and now. But thanks for the tip, buddy. How many units do you currently own?

If you own rentals in SoCal, there are some universal truths.

You have dozens of tenant applications whenever anything goes on market.

It's been this way since I've owned rentals in SoCal (since 2012).

I've never ever had to lower rent (in fact I've raised rents 3-5% across all my rentals every year since 2012).

[Teckeeee]

Do people really believe there will be a crash like 08? Don't think so the underwriting recs are so much more difficult now. The only real crash I see is in the auto loan market since they have done similar to what housing did in 08 fast and loose with loans, but not the housing market this time.

I am praying for a 10% drop but I don't see until the Fed starts increasing rates, which Canada did the other day, but there is no real sign from the Fed that they plan on greatly increasing rates which would crack the housing market.

[Teckeeee]

Originally Posted by Joe Van Fossen

I met a landlord a few years ago while helping a tenant into a rental in Irvine. This guy owned four 3-bedroom condos in a Woodbury development that he bought in the 70s for around $40K each. He was retired and at the time he was leasing these units out for $2350/mo. Now they're going for about $2800/mo. That's a passive gross income of $134,400/yr, in retirement. That's on an initial investment of $160K ($627K adjusted for inflation). There have probably been half a dozen or more "top of the markets" since he bought them.

Good for that guy very smart. A family friend did similar and in retirement she is the Millionaire Next Door, except she drives a slightly used Audi not a Chevy. Her business partner died so she had to liquidate all of the properties because he was the true brains of the real estate investment, she just invested 50% with him.

I wonder if at the time 40k was perceived as $$$ or good value for those condos in the 70's? I mention that because a friend, his grandmother bought ocean front property in the 60's in Balboa/Newport Beach for 60k now that house, which the family trust still owns, is worth 2.5 million. He asked his grandma and she told him at the time people thought she was crazy to spend 60k for a vacation property........she is laughing to the bank now.