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thanks Engelo
great summary
the only comment that does not make sense to me (based on Aussi real estate) is that in class A property where the majority is owner occupier i would have thought that increased demand and therefore rental income as the renter would have limited supply to choose from?Hi Guys
can someone please explain what a c class property is?
or is there a link that explains the difference between a b and cthanks
Jay
thanks great answer
Market is far more complicated than any market in Australia.
The Market here in relative terms is much easier to read and way more logical.
And we have an undersupply of housing to make the economics 101 supply and demand equation a good back up
I know a lot of people here that have overpaid and made mistakes but still end up on the right end of the deal as they get good stable rents and hang on for a couple of years and the market catches up.
think i will stay in my own backyard where the risk level is pretty low
thanks for all your great posts
thanks again
so what i am really trying to understand is how has the atlanta market gone over the last 12 months
is that market still moving and has there been any capital growth in the last 12 months?
Jay,
great summary thanks
one question please: the houses in Atlanta that you bought for 40k and sold to hedge fund for 60-70k what is their value today?
thanks
thanks for your comments Freckle. I appreciate your time to answer the question. I did not really understand the taper term so for others that may also not be familiar with this term see below Federal Reserve officials really don’t like the word “tapering” — one of the most popular buzzwords in the markets these days.
AFP/Getty Images
The Federal Reserve building in Washington.The Merriam-Webster dictionary defines the verb to taper as “to become progressively smaller toward one end.”
Stock and bond market investors and many television commentators regularly use tapering as shorthand for the Fed gradually reducing its monthly bond purchases.
The hangup for Fed officials is the word “tapering” suggests a slow, steady and predictable reduction from the current level of $85 billion a month at a succession of Fed meetings, say to $65 billion per month, then to $45 billion and so on. And that’s not necessarily what Fed officials envision.
Because Fed officials are uncertain about the economic outlook and the pros and cons of their own program, they might reduce their bond purchases once and then do nothing for a while. Or they might cut their bond buying once and then later increase it if the economy falters. Or they might indeed reduce their purchases in a series of steps if warranted by economic developments — but they don’t want the markets to think that’s a set plan. It is, as Fed officials like to say, “data dependent.”
That’s why the Fed’s most senior officials avoid the word. Fed Chairman Ben Bernanke never uttered the word “taper” in his March press conference; nor did he use it in more than two hours of congressional testimony last month. Instead, he said then, “in the next few meetings, we could take a step down in our pace of purchases.”
New York Fed president William Dudley also has been avoiding the word. Instead, he’s talked about wanting to “reduce the pace at which we are adding accommodation through asset purchases.”
Nevertheless, analysts can’t stop talking about tapering.
“Before today’s number our call for a first tapering was on a knife-edge between September and December,” J.P. Morgan economist Michael Feroli said in a note to clients Friday morning;
“No Tapering (Yet) by the Fed,” IHS Global Insight economist Nariman Behravesh said;
“Liquidity bulls gashed by Fed tapering fears,” said Bank of America investment strategist Michael Hartnett.
To be fair, the analysts became attached to the word taper after it was used a few times by the Fed itself.
The term showed up twice in minutes to the Fed’s March policy meeting. It showed up once in the April minutes, though then it was only associated with Fed dissenter Esther George, president of the Kansas City Fed, who wanted to end the bond-buying program then.
The Fed has fought rhetorical battles with investors in the past and lost. Officials disliked the obscure term “quantitative easing,” often used in the markets to describe their bond buying program. Instead officials tried an equally obscure term, long-term asset purchases, to describe it. But the market has stuck with quantitative easing, or QE.
It will likely lose the battle over the term “tapering.” But don’t expect to hear the term cross Mr. Bernanke’s lips.
HI Freckle, what are your thoughts on the A$ v US$ ? The admission from the US that they need to continue with the stimulus did not seem to have a major effect, i would have thought it would have put the A$ back at 97 odd?
Jay,
i think it would be good if you also listed the pitfalls of this type of purchasing
eg: potential liabilities on the title
owners trashing the place when they find out they have to move
existing tenants being unwilling to pay rent etc
thanks
WI
could you please let me know if you had help selecting the properties you bought
is there anyone you would recommendif the answer to this is somewhere else on this forum could you provide the link
thankyou in advance
Hi Jay,
what is your view on the Portland realestate market?
what sort of returns would you expect in portland?
how many years away before any capital growth returns?
thanks
