If You Don't Own, You Are Owned
The median home price in Bakersfield, California has nearly tripled in the last four years. Compared to hell, Bakersfield has a lot going for it.
This week, Business Week is asking How Toxic is Your Mortgage? If you've been a homeowner since before there were three prime-time television shows about flipping real estate, you could probably be forgiven if you didn't notice that over 35% of mortgage originations in San Jose last year were so-called payment-option ARMs.
As you might expect, there's a lot of talk about real estate at work. A number of folks are invested in real estate both here in California and in states far and wide. That got me thinking about Dallas, a city I understand pretty well. Is there an opportunity there I'm missing?
Quiz time: How much does a 3500 sq.ft. McMansion rent for in Richardson, TX?
Answer: $1750. At least, that's what the MLS listing says they are asking. Please feel free to verify. It won't take you long to find this one, it's one the most expensive rental listings in Richardson.
This house is probably worth somewhere in the neighborhood of $350,000. The property taxes probably run about $7,000/year (This is Texas folks; there's no state income tax) I can't find any scenario under which this makes a good investment, unless you were under the impression that Texas real estate ever appreciates; It doesn't. Here's my analysis:
If the owner of this house isn't an out-of-state investor, he's most likely an upside-down borrower who thought renting the property out would be easier than a short sale.
This week, Business Week is asking How Toxic is Your Mortgage? If you've been a homeowner since before there were three prime-time television shows about flipping real estate, you could probably be forgiven if you didn't notice that over 35% of mortgage originations in San Jose last year were so-called payment-option ARMs.
As you might expect, there's a lot of talk about real estate at work. A number of folks are invested in real estate both here in California and in states far and wide. That got me thinking about Dallas, a city I understand pretty well. Is there an opportunity there I'm missing?
Quiz time: How much does a 3500 sq.ft. McMansion rent for in Richardson, TX?
Answer: $1750. At least, that's what the MLS listing says they are asking. Please feel free to verify. It won't take you long to find this one, it's one the most expensive rental listings in Richardson.
This house is probably worth somewhere in the neighborhood of $350,000. The property taxes probably run about $7,000/year (This is Texas folks; there's no state income tax) I can't find any scenario under which this makes a good investment, unless you were under the impression that Texas real estate ever appreciates; It doesn't. Here's my analysis:
If the owner of this house isn't an out-of-state investor, he's most likely an upside-down borrower who thought renting the property out would be easier than a short sale.