You are a Chinese immigrant, inherited a million dollars, just moved to Irvine

[The Motor Court Company]

For real estate investing, I am more old school and looking at cash flow. Relying on capital appreciation could be quite risky.

The Motor Court.... there are other emerging markets right now like Austin Texas.... Certain zip codes in Austin have appreciated 20% year over year. Johns Creek is not the only emerging real estate market in town.

I get it, you mean Johns Creek?

To be honest, the only asset class that i see a clear opportunity to make some serious money in the next 5 - 10 years is SFR rentals in emerging real estate markets, and I am not talking about overpriced real estate in Irvine.

 

[usctrojancpa]

The Motor Court.... there are other emerging markets right now like Austin Texas.... YoY there has been double digit appreciation in Austin. Johns Creek is not the only emerging real estate market in town.

I get it, you mean Johns Creek?

To be honest, the only asset class that i see a clear opportunity to make some serious money in the next 5 - 10 years is SFR rentals in emerging real estate markets, and I am not talking about overpriced real estate in Irvine.

I get what you are saying, but the problem is that a lot of people are not comfortable investing in rentals that are not within driving distance (especially first time real estate investors).  Also, property Management fees can also eat away at cash flows when they are at 8-10% of the gross rent.  Not many people can just pack up and move to emerging real estate markets because their jobs, friends, and family are located where they are currently living.  I'm an individual with one of the higher risk tolerances that you'll find on here but even I'm a bit hesitant in buying a residential rental property that I can not easily get to if something pops up (a commercial property would be a whole different story). 

 

[panda]

Yes me too. In my neck of the woods ... it is still much cheaper to own than to rent. I do require atleast a 10% cash on cash return on any invesments i take on. I recommend you pick up a book called " Emerging Real estate markets" from David Lindal. I believe that appreciation can be predicted much easier than the stock market.

For real estate investing, I am more old school and looking at cash flow. Relying on capital appreciation could be quite risky.

The Motor Court.... there are other emerging markets right now like Austin Texas.... Certain zip codes in Austin have appreciated 20% year over year. Johns Creek is not the only emerging real estate market in town.

I get it, you mean Johns Creek?

To be honest, the only asset class that i see a clear opportunity to make some serious money in the next 5 - 10 years is SFR rentals in emerging real estate markets, and I am not talking about overpriced real estate in Irvine.

 

[usctrojancpa]

Yes me too. In my neck of the woods ... it is still much cheaper to own than to rent. I do require atleast a 10% cash on cash return on any invesments i take on. I recommend you pick up a book called " Emerging Real estate markets" from David Lindal. I believe that appreciation can be predicted much easier than the stock market.

For real estate investing, I am more old school and looking at cash flow. Relying on capital appreciation could be quite risky.

The Motor Court.... there are other emerging markets right now like Austin Texas.... Certain zip codes in Austin have appreciated 20% year over year. Johns Creek is not the only emerging real estate market in town.

I get it, you mean Johns Creek?

To be honest, the only asset class that i see a clear opportunity to make some serious money in the next 5 - 10 years is SFR rentals in emerging real estate markets, and I am not talking about overpriced real estate in Irvine.

Your appreciation should be based upon the projected increase in net operating income (NOI) from the home via increasing rental rates.  You should calculate your entry cap rate (net operating income using market factors such as market vacancy, a management fee, and capital reserves) which is effectively your "cash-on-cash" return....NOI/cost of the purchase.  That same cap rate should be used as your exit cap rate along with a future projected NOI when you sell the home in forecasting what your future sales price might be.  That being said, if interest rates rise substantially you will have to adjust the exit cap rate higher.

 

[panda]

Look at these beautiful charts. I am starting to love Agriculture and the Energy sector. Serious fortunes will be made if you have the foresight to invest in agriculture today.

Ticker RJA : Agriculture Sector
Ticker XLE : Energy Sector

 

[usctrojancpa]

Looks like major support around $7 for RJA and $50 for XLE....maybe I'll seel some uncovered puts on both at those levels with another drop. 

 

[panda]

I made this post on October 28th, 2009 on Irvine Housing Blog. In 2009, all the focus was on the crisis was in the U.S. and no one thought twice about Europe. It is going very important to be safe and play defensive in the next 18 months. I would advise to diversify your portfolio into real estate, strong reserves of cash, and precious metals. Having all your cash locked up in a highly leveraged new Irvine home with very little cash reserves outside is asking for serious trouble.

At this time, i would put a time frame of the global crash 1st quarter in of 2013.

 

[jamboreedude]

I made this post on October 28th, 2009 on Irvine Housing Blog. In 2009, all the focus was on the crisis was in the U.S. and no one thought twice about Europe. It is going very important to be safe and play defensive in the next 18 months. I would advise to diversify your portfolio into real estate, strong reserves of cash, and precious metals. Having all your cash locked up in a highly leveraged new Irvine home with very little cash reserves outside is asking for serious trouble.

At this time, i would put a time frame of the global crash 1st quarter in of 2013.

Wouldn't real estate also crash if there was a stock market crash?

What if someone had invested all-cash in an Irvine home, would they be affected badly by the crash?

 

[panda]

Jamboreedude,
The big question is whether deflation or inflation will dominate. I am certain that Bernanke execute Qe3 when the stock market starts to detoriate which will be good for real estate, precious metals, agriculture stocks, etc. If deflation takes place you want to be in the U.S. Dollar. An Irvine Home if 100% paid off will hold its value like gold during a stock market crash. Short term i see deflation and long term i see inflation. If i were predict the Irvine housing market in the next 2-5 years, Irvine homes will become more and more unaffordable in the future as the mortgage rates will slowly start to rise but the prices will stay the same or go down very little. In tier 1 emerging real estate markets like Houston, Austin, Dallas, Atlanta we will see these markets appreciate to rental parity.

Here is the list of the fastest growing metro cities from July 2010 - July 2011.http://www.bizjournals.com/bizjourn...in-population.html?appSession=962952241641008

I made this post on October 28th, 2009 on Irvine Housing Blog. In 2009, all the focus was on the crisis was in the U.S. and no one thought twice about Europe. It is going very important to be safe and play defensive in the next 18 months. I would advise to diversify your portfolio into real estate, strong reserves of cash, and precious metals. Having all your cash locked up in a highly leveraged new Irvine home with very little cash reserves outside is asking for serious trouble.

At this time, i would put a time frame of the global crash 1st quarter in of 2013.

Wouldn't real estate also crash if there was a stock market crash?

What if someone had invested all-cash in an Irvine home, would they be affected badly by the crash?

 

[jamboreedude]

A chinese immigrant would consider an Irvine home or an Arcadia home?

 

[Crispy3]

I think a lot of the Chinese immigrants would first look at the San Gabriel, Arcadia area (if from mainland China) and Rowland Heights, Walnut area (if from Taiwan) and as they get more exposure to western culture they would move to places like South Pasadena, Irvine if they could afford it. I myself was born in Taiwan and came to the states about 25 years ago... I've been looking for my dream home in Irvine for about a year already with little success.

 

[Crispy3]

Baby Panda - I'm sticking to what i know best which is VIX and VXX options and I'm not touching currencies or gold/silver.  50%+ annual returns the past 3 years work for me but I am beginning to mix it up s bit since volatility has risen the past 2 months using strangles, straddles, and call/put spreads as well as going long or short the VXX with covered calls/puts.

I've been burned badly trading VIX and VXX and promised myself never to touch them again been doing well playing option straddles on high volatility stocks such as aapl. I also believe tech has been oversold lately and will most likely recover later this week. I am about to cover a few shorts and switch sides today... I think tomorrow we get some good ECB news and big ben will hint at QE3 on Thurs.

I also think gone are the days of buy and hold (they were gone as of 2008). One has to be nimble to try and make a profit in this market.

 

[irvinehomeowner]

..... IHO.... and where exactly is the DOW today???      Guess what... it is going lower. Mark this post.

I don't think the DOW will break 13k..

I will be shocked if DOW breaks 13k.

Aha... this is where I read that.

No wonder Baby Panda Irvine has been so quiet lately.

Uh... it hit 13k again yesterday.

 

[irvinehomeowner]

Will Baby Irvine not come out until the Dow goes below 13k?

 

[usctrojancpa]

Will Baby Irvine not come out until the Dow goes below 13k?

The powers that be are grinding the market higher and the shorts are getting squeezing.  I'm enjoying it from the sidelines selling VIX calls and pocketing the premiums. 

 

[flipper]

Will Baby Irvine not come out until the Dow goes below 13k?

The powers that be are grinding the market higher and the shorts are getting squeezing.  I'm enjoying it from the sidelines selling VIX calls and pocketing the premiums. 

You will get burned badly if you are selling nake calls instead of spreads as VIX may shoot up 50% in one day.

 

[usctrojancpa]

Will Baby Irvine not come out until the Dow goes below 13k?

The powers that be are grinding the market higher and the shorts are getting squeezing.  I'm enjoying it from the sidelines selling VIX calls and pocketing the premiums. 

You will get burned badly if you are selling nake calls instead of spreads as VIX may shoot up 50% in one day.

I sell mostly way out of the money calls and/or puts for my bigger trades and then do strangles as well as other advanced option startegies while mixing in going long/short VXX shares and options.  In the past 3 years, I've only lost money in 3 months.  I'm currently playing with "house" money as my returns have been over 50% per year for the past 3 years.  I tolerate a good bit of risk but I know how to manage it and use trailing stops to protect myself. 

 

[velbon]

a vxx call spread makes a lot sense now. VXX Oct 12-19 call spread.

Baby Panda - I'm sticking to what i know best which is VIX and VXX options and I'm not touching currencies or gold/silver.  50%+ annual returns the past 3 years work for me but I am beginning to mix it up s bit since volatility has risen the past 2 months using strangles, straddles, and call/put spreads as well as going long or short the VXX with covered calls/puts.

I've been burned badly trading VIX and VXX and promised myself never to touch them again been doing well playing option straddles on high volatility stocks such as aapl. I also believe tech has been oversold lately and will most likely recover later this week. I am about to cover a few shorts and switch sides today... I think tomorrow we get some good ECB news and big ben will hint at QE3 on Thurs.

I also think gone are the days of buy and hold (they were gone as of 2008). One has to be nimble to try and make a profit in this market.

 

[Liar Loan]

I think you guys are nuts to be fighting this trend.  The Dow will almost certainly go above 13k.  I think it will test the '07 high of 14k before crashing again.  Job creation is headed in the right direction as are many other indicators.  Eventually investors will perceive things to be overpriced and start selling, but I don't think that time is now.

Cha-ching!  I hope y'all covered your shorts.  With 1.5 million new jobs added and the commencement of QE-Infinity, shorting the market in 2012 was a very bad idea.

Told ya so.... 

 

[DEBBIE MOHLER]

I guess you should come to the United States screw everybody you can to raise your family If you can live with yourself good for you.Everybody has hard times thats life.