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Old 05-26-2013, 09:31 AM
 
Location: Just south of Denver since 1989
11,485 posts, read 31,078,908 times
Reputation: 8109

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Buying a property, or not; is a personal choice. Anyone who has studied the market in the metro area, can see opportunity. The investors are still at the foreclosure sales, and still buying houses here. That tells me there is money to be made.

I saw the inventory decline start in October of 2011. People and the press are just starting to notice.

I never saw a bubble here. I saw appreciation pretty much flat line across the metro area for ten years.

Lots that have sat for two years on the market, are now closing.

Building permits are up, for lot development & tenant finishes.

Interest rates are artificially low. Housing prices are not tied to affordability.

I think everyone who wants to own a property, should have that chance. But it's their risk and their reward.
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Old 05-26-2013, 09:53 AM
Status: "Looking forward to President Harris" (set 23 days ago)
 
Location: Berkeley, Denver, CO USA
15,628 posts, read 23,512,030 times
Reputation: 26873
Default Skydog makes a good point. Some more.

1. Case-Shiller data for "Denver" are really for the "Denver-Aurora-Lakewood, CO Metropolitan Statistical Area" which is commonly abbreviated as "Denver-Aurora". This MSA is "the following ten counties of the State of Colorado: the City and County of Denver, Arapahoe County, Jefferson County, Adams County, Douglas County, the City and County of Broomfield, Elbert County, Park County, Clear Creek County, and Gilpin County."

2. Homebuilders Association (HBA) of Metro Denver says "the counties of Adams, Arapahoe, Boulder, Broomfield, Denver, Douglas, Elbert and Jefferson, as well as all of the municipalities in each county." So, NOT, Park, Clear Creek and Gilpin counties.

3. Metrolist, Inc. serves five Realtor associations: Aurora Association of Realtors, Denver Metro Association of Realtors, Douglas/Elbert Realtor Association, Mountain Metro Association of Realtors, and South Metro Denver Realtor Association.

4. Another point is that POSTAL addresses and MUNICIPALITY addresses are only vaguely related. Just ask anyone about "Englewood". Or those people who live just north of me in unincorporated Adams County with a Denver postal address.
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Old 05-26-2013, 11:43 AM
 
Location: South Bend, IN
257 posts, read 556,105 times
Reputation: 67
Quote:
Originally Posted by SkyDog77 View Post
The Metro Area encompasses the city AND all of the suburbs outside the city....

...The first two articles you posted made mention of the same statistic that approximately 20% of homeowners in The Metro Area owe more than their house is worth...

So again, did I miss some mention of the market in the actual city?
If 20% of homeowners in the Metro Area owe more than what their house is worth, and by your own words, the metro area INCLUDES the city... then... yes apparently even though you re-read things, you still missed things.

As I said these are just a few examples of the data, not the only ones. So again, yes especially if you are an investor, you've been missing some data for a while now. This isn't just an occurrence out there, it's nationally in many sectors.

Quote:
Originally Posted by SkyDog77 View Post
I too am a real estate investor and I find this market incredibly challenging, but that doesn't mean that I am out. I buy for the long term. As for my personal residence, I don't look at this as an investment. It's somewhere to live. I plan to stay in my house for the next 20 years. If I overpay by $50,000 do you think that will really matter in 20 years? I don't.
Well, good for you and your facts you choose to deem relevant. If you are not pausing your individual buys in an inflated market... as an investor... and don't mind overpaying by 50 grand for a house... Cheers! Good luck to you!
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Old 05-26-2013, 04:00 PM
 
Location: 0.83 Atmospheres
10,753 posts, read 8,643,849 times
Reputation: 11074
Quote:
Originally Posted by new_to_town View Post
If 20% of homeowners in the Metro Area owe more than what their house is worth, and by your own words, the metro area INCLUDES the city... then... yes apparently even though you re-read things, you still missed things.

As I said these are just a few examples of the data, not the only ones. So again, yes especially if you are an investor, you've been missing some data for a while now. This isn't just an occurrence out there, it's nationally in many sectors.



Well, good for you and your facts you choose to deem relevant. If you are not pausing your individual buys in an inflated market... as an investor... and don't mind overpaying by 50 grand for a house... Cheers! Good luck to you!

A couple things here I take exception with:

1. Just because Denver is part of the metro area does not mean that because there is a 20% underwater rate in the metro area, there is a 20% underwater rate in Denver. This is a completely flawed argument from a logical perspective. The Denver Metro area has a population of 2,600,000. Denver is approximately 600,000 of that or roughly 23%.

If you think that the market conditions in Adams County, Arapahoe County, Jefferson County and Douglas County are the same as they are in Denver County, you really have not done your homework at all. Every suburb is different just like every neighborhood is different. Wash Park and Green Valley Ranch do not have the same real estate situation, but if I average these two neighborhoods together it might appear that Wash Park was not a favorable place to own, especially if I weighted Wash Park at only 23%. How does that make any sense?


2. You keep saying that these are just some of many examples. If you have an example that shows the number of underwater homeowners in Denver County, why don't you post it? That's all I would like to see. If I'm wrong, I'm a big boy and will admit it.

3. What is your investment strategy? Are you counting on an equity increase to make your money back? I know some people who try to go that route, but that is a very tough game to play. I look at capitalization rates. Since I buy and hold, equity is of very little concern to me and if I do end up getting an equity increase because of market appreciation, it is just gravy. I never count on it.

4. Here is the story of the house that I "overpaid $50,000" for in 2007. I paid $650,000 for it with plans to scrape and build there later. I think it probably should have sold for $600,000, but it was not on the market and is an unusually large lot for the neighborhood. I moved renters in and got it paid down to the point where I could scrape it last year and build. The final project value is in the neighborhood of $1,350,000 and I will have about $400K in equity when construction is wrapped up. But guess what? I don't care because it is my home, not an investment. Investments return cash. That's why cap rates are more important than equity if you aren't trying to flip properties. I plan to stay in this home for at least 20 years. Had I passed because of $50K, I would be kicking myself today. On a side note, a builder offered me $675 last fall before I tore it down so I guess I didn't really overpay that much.

Last edited by SkyDog77; 05-26-2013 at 04:24 PM..
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Old 05-26-2013, 04:48 PM
 
Location: South Bend, IN
257 posts, read 556,105 times
Reputation: 67
You're a buy and hold investor who doesn't care about equity? Hmm. Like I said... cheers - good luck!
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Old 05-26-2013, 04:53 PM
 
Location: 0.83 Atmospheres
10,753 posts, read 8,643,849 times
Reputation: 11074
Quote:
Originally Posted by new_to_town View Post
You're a buy and hold investor who doesn't care about equity? Hmm. Like I said... cheers - good luck!
If I buy a piece of property for $100,000 and I make $10,000 a year in rent, I am getting a 10% return on my cash. If the market value of the building drops to $90,000 and I am still getting my $10,000 a year what do I care? I'm not planning to sell the building. I care about rental income, not equity.

My investment strategy aside, I'm still looking for that data on the Denver housing market showing the amount of borrower who are upside down.

Last edited by SkyDog77; 05-26-2013 at 05:10 PM..
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Old 05-26-2013, 08:23 PM
 
Location: South Bend, IN
257 posts, read 556,105 times
Reputation: 67
Quote:
Originally Posted by SkyDog77 View Post
If I buy a piece of property for $100,000 and I make $10,000 a year in rent, I am getting a 10% return on my cash. If the market value of the building drops to $90,000 and I am still getting my $10,000 a year what do I care? I'm not planning to sell the building. I care about rental income, not equity.

My investment strategy aside, I'm still looking for that data on the Denver housing market showing the amount of borrower who are upside down.
Yes, I know about cap rates as you had asked in your original unedited post. I have been a successful real estate investor for 15 years. Post what you posted here in any investors forum and see what they say about your strategy. I don't need to.

And you keep asking for "more" evidence. Who cares what you want over what I've already posted? Google it yourself. I have nothing to "prove" to you. Call city records if you're so concerned. But an investor would already know this... right?
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Old 05-26-2013, 08:41 PM
 
Location: 0.83 Atmospheres
10,753 posts, read 8,643,849 times
Reputation: 11074
Why are you so getting personal? Must have struck a nerve. I have worked with people like you. They go on the attack whenever they are challenged. You must be a lot of fun to be around.

Last edited by SkyDog77; 05-26-2013 at 08:51 PM..
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Old 05-26-2013, 08:50 PM
 
Location: South Bend, IN
257 posts, read 556,105 times
Reputation: 67
As you wrote in your original unedited post to me:

"Let's cap this discussion:

I made the assertion that very few people living within the city limits of Denver are underwater on their homes.

You disagreed with me and posted data about the entire metro area (And Grand Rapids, Michigan for some reason)

I responded that Denver makes up a small percentage of the metro area and that just because something is happening in Adams County does not mean it is also the case in Denver County.

You went personal because you can't prove something that simply isn't true.

Sound about right?

P.S. I do just fine. An investing forum is the last place I would turn for advice on my strategy. I look at my rent checks."

I haven't gone personal with anything, please read your own posts. I presented the data as I have researched it for the past year or so with my contacts there as I have been considering a move and investments there. You are the one that keeps repeatedly asserting for me to prove (again) a data point that for you happens to be SO important for whatever reason. I'll say it again, believe what you want to believe, it truly doesn't matter to me.

I have tried to end this discussion, several times now. So, I will say it yet again: "Cheers, and Good luck to you."
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Old 05-26-2013, 09:31 PM
 
Location: 0.83 Atmospheres
10,753 posts, read 8,643,849 times
Reputation: 11074
Riiiight.

I can't believe I let myself get drawn in to this.
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