jspoto
Posts:218
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| 07/27/2008 11:18 AM |
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| o.k people - here are two hot buys I believe are excellent investments for the long term. One is 877 Island #607 - 2300 sq ft on the 6th floor of Park Loft. Southern Exposure. There is a unit on the 10th floor with the same sq footage asking 3.2mil. If the unit does not sell within a couple of weeks, I would go in with an offer of 650k and start there. I would make the unit a 3bedroom and rent it for min 3500m. The second listing is a bit different opportunity. 366 22nd street is a 3 unit triplex that needs a bit of work still. Rough neighborhood, but rents would be apx 3000m for a sales price of 234k. this unit I bet will sell quickly and over asking price. These are a couple examples of what I would consider "buys" even in this market. |
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jackjack
Posts:155
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| 07/27/2008 11:57 AM |
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Thanks for the info. I appreciate it. I like the fact that you actually explained the reasons why it was a good deal. Your reasons made perfect sense.
I always am on the look for new opportunities - no matter what the market may be - you never know when you will find a diamond in the rough! I wish this forum would have more posts about "hot buys." I am of the mindset that you cannot hoard information - you should share it.
Here is my "hot buy:" 3744/3746 Cherokee, San Diego, CA 92104. This is a duplex in a not so nice area of North Park, but North Park nonetheless. It is a fixer - and a major one at that - but it has lots of potential. It is listed at 310K. Both units are 2 bedrooms (one of the units is 1,000+ square feet), and it is on a big lot. If you could get it down to 250K and you had about 80K cash for fix up costs, I think this would be a good investment. I checked this property out, and you won't have a lot of competition on this one due to the fact that it is such a fix up project. I have not really checked rents in the area but you could probably rent both units for about $1500 a piece. |
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Brian
Posts:2234
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| 07/27/2008 11:57 AM |
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At $699,000 Parkloft #607 would be close to Year 2000 price, just like I predicted.
I think that Year 2000 prices would represent good buys. |
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wilson
Posts:564
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| 07/27/2008 12:16 PM |
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jspoto,
What is the pet policy for dogs in Parkloft? Any limit on dog size? |
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Betty
Posts:147
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| 07/27/2008 12:16 PM |
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Okay let's do the math here: assume that you'll get the Park Lift unit for $ 650,000 and you'll pay $ 150,000 down, your mortgage (6 % for 30 years) is
around $ 3000/month. The HOA fees are ca. $ 750/month and your property taxes are around $ 600/month, that adds up to $ 4, 350/month. This
is before the remodeling cost, I might add. Even if you can rent the unit for $ 3500/month you still have a negative cash flow of $ 850/month and to that
you have to include the remodeling expenses. Not so hot in my book, unless you can put 40 to 50 % down.
The other one is a foreclosure, right? $ 3000/month per unit? In that neighborhood probably not. |
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jspoto
Posts:218
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| 07/27/2008 12:32 PM |
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| betty - I dont think you realize the value of having 2300 sq ft in downtown. At 280 per sq foot it is a bargain. Try building anything today for 280 sq ft and see what you get. The location is unbeatable. I would take a negative on the rents waiting for the market to improve. remember, this is just part of the normal business cycle of ups and downs. yes, we are going down now, but there will be a time when we go back up. Park loft #607 I would love to own in my portfolio. The other one is 3k a month in rents for all 3 units. Thanks JackJack for posting your "hotbuy" I think this is a positive addition to this site if we can post some of the deals that we see value in. |
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jspoto
Posts:218
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| 07/27/2008 12:34 PM |
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| also betty - if Brian thinks that it is a deal at 650k, than it must be! - wilson - I dont know the policy on dogs - I have the CC&R's, but their as thick as the yellow pages. However, I will check for you... |
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Betty
Posts:147
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| 07/27/2008 12:42 PM |
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Good luck then, jspoto!!
Being a home owner in LJ, I wouldn't spend $ 650,000 on a downtown condo.
Then again, my priorities are surely different. |
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wilson
Posts:564
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| 07/27/2008 12:52 PM |
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Just curious: what is 2000 price for something built after 2000? Is it like the sound of one hand clapping?
Jspoto has a good point on value: replacement cost. Where a property costs less than its replacement cost, there is probably value especially if desirable quality/construction/view/location. |
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jspoto
Posts:218
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| 07/27/2008 12:53 PM |
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| maybe if you were not a homeowner in LJ than you would have 650k to spare to buy a downtown condo. I know of some LOTS in LJ that are smaller than 2300 sq ft., so please spare me. |
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jspoto
Posts:218
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| 07/27/2008 1:52 PM |
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| wilson - the policy on dogs is: no more than 2 dogs (none can be dangerous or detrimental to the safety of the occupants of the project, i.e. pit bull) all dogs must be on a leash when on property grounds. if your dog destroys any common areas, than the owner is responsible to fix. There is no restriction on size or weight. hope that helps... |
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Brian
Posts:2234
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| 07/27/2008 2:04 PM |
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I think that a 2300sf unit downtown is nice because it's rare, size wise.
Value wise, I believe that real estate still has a long way to drop. People see the values relative to what prices were just a couple of years ago. So everyone, including those who lost their properties to foreclosure still think prices will bounce back in a V shaped recovery. All the macro indicators point to a long L recovery. Plus there's never been a V recovery before. So if you're going to buy real estate, I believe that you'll have much more to pick from in a couple of years.
Having said that, I think that there are good buys today, relative to the market (I stress the word "relative"). I'm not buying yet because I'm waiting for the pick of the litter. But if you absolutely have to buy to fulfill an ownership need, then be selective and negotiate well. You need to have a 10-year time horizon. 5 years is too short.
You can buy a large SUV now at a great price. But do you even want one? Will those SUVs continue to decline in prices? If you believe that they won't make large SUVs anymore, and you need one to transport your large family, then yeah, go out and buy. I bought an SUV (although I think that prices will drop some more) because I needed one to pull my trailer.
Wilson, by Year 2000 prices, I mean Year 2000 price levels. If you think that original developer price is the floor, then you are still in denial.
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wilson
Posts:564
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| 07/27/2008 4:29 PM |
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jspoto: thanks very much for looking that up for me. That's what i was hoping to hear. I've got a dog on the larger size. Parkloft is high on my list when I'll be ready.
brian: I never indicated that original developer prices is a floor. Judging a unit's price hitting 2000 price levels when it was built after 2000 obviously requires assumptions and is a subjective assessment. I was amused by that and wanted to point it out.
I think the guessing at "year price levels" is ultimatley unproductive. Different segments of the market are moving at different paces. Generally the higher priced/larger properties have not moved as much as the low end. "Year 2000" prices is a yardstick that lumps everything together. To time the market, I think it is much more productive to look for a marker (like NOD/NOT decreasing) as the marker that the market is bottoming. If you find a compelling value before that, pull the trigger by all means. The chances of getting just the perfect property at the perfect price at the perfect time will require you to be very, very lucky in addition to being patient. |
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dans
Posts:2
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| 07/28/2008 9:45 AM |
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jspoto,
I have been trying to buy in PL for a couple of months now but I can find no lender to finance there due to litigation. How did you get in? Thanks, Dan |
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jspoto
Posts:218
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| 07/28/2008 9:48 AM |
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| dans - are you trying to but a owner occupied or investment property ? |
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dans
Posts:2
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| 07/28/2008 10:02 AM |
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jspoto,
can you PM me at danslac@gmail.com |
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Brian
Posts:2234
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| 07/28/2008 1:04 PM |
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Posted By Betty on 07/27/2008 12:42 PM
Good luck then, jspoto!!
Being a home owner in LJ, I wouldn't spend $ 650,000 on a downtown condo.
Then again, my priorities are surely different.
I hear you Betty. You must have bought before 2000.
The problem I see is that people who are jumping at the "values" right now don't have enough hindsight to determine "true" value.
I would stay that IF you must buy, then they are some "values" to be had. If you don't have to buy, then wait.
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chevy
Posts:8
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| 08/03/2008 8:35 AM |
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| Re. Park Loft: what about the litigation that is ongoing? Doesn't this scare anyone? Does anyone have an update on it? |
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Betty
Posts:147
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| 08/03/2008 8:42 AM |
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Well, we established already that it wasn't such a hot buy after all.
Brian, yes I bought before 2000 - I've been buying and selling since 1985 (so far always buying up thanks to the dips in RE). |
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jspoto
Posts:218
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| 08/03/2008 12:08 PM |
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| Betty - who is "we" that established this ? you and your bingo class at the rec center ? I had my agent inquire about making an offer for 650k and they wouldnt even listen. Said they are in counter at 750k....let's see when it goes pending. |
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