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Old 03-22-2008, 07:22 PM   #21
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Well, history never repeats itself exactly but... I bought a House in San Antonio, Tx for $56 K in 1979, and then promptly decided to go work overseas and rented the house thinking houses only go up. Well forward a few years, got back to the US in 1986 and guess what, market in Texas took a dive in the intervening years and I was under water. What to do, well rent a few more years ( property manager all these years) and guess what? - it took until 2005 before I could sell the house at a profit which I promptly did. I kept track of all my expenses (new roof, driveway, appliances anyone), tax deductions, rent collected, commissions etc. After all said and done, I made about $20 K for over 25 years of worrying about the damn thing. I'm sure some people have made fortunes in real estate but for myself, I've done considerably better without that particular ball and chain (ER'd for 6 years now no thanks to real estate). My 2 cents. YMMV
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Old 03-23-2008, 01:15 AM   #22
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Well, history never repeats itself exactly but... I bought a House in San Antonio, Tx for $56 K in 1979, and then promptly decided to go work overseas and rented the house thinking houses only go up. Well forward a few years, got back to the US in 1986 and guess what, market in Texas took a dive in the intervening years and I was under water. What to do, well rent a few more years ( property manager all these years) and guess what? - it took until 2005 before I could sell the house at a profit which I promptly did. I kept track of all my expenses (new roof, driveway, appliances anyone), tax deductions, rent collected, commissions etc. After all said and done, I made about $20 K for over 25 years of worrying about the damn thing. I'm sure some people have made fortunes in real estate but for myself, I've done considerably better without that particular ball and chain (ER'd for 6 years now no thanks to real estate). My 2 cents. YMMV
As much as I hate the term "timing the market," timing is really important in the real estate cycle. Good for you for keeping track of all your expenses, etc. I don't know if I really want to know after 25 years what the costs add up to. That's a good reference--thank you for sharing.
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Old 03-23-2008, 03:42 AM   #23
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after 20 years of land lording i too woudnt be a landlord again -ever. after taxes, expenses, renovations, aggrevation, stiffed on rent a few times the return stinks, and im talking new york city ( not manhattan though)
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Old 03-23-2008, 09:59 PM   #24
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We're accidental landlords as well but (despite being handy) we don't appreciate the hassle. Our ROE is also below CD rates, despite the recent Fed cuts, and we could do better in a blue-chip dividend stock fund.
?
Return On Equity (ROE)
A measure of a corporation's profitability that reveals how much profit a company generates with the money shareholders have invested.

Calculated as:

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Old 03-24-2008, 09:10 AM   #25
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I too am a landlord and I agree that it is very difficult to make a good return. I like it because I do not have a pension so it's one of the most non-correlated assets to hold verses the equity markets, especially with how globalization has created higher correlation of global markets. If it was me then I think I would wait one more year and then sell it if you don't want to hold a real estate position. That's because I believe the current panic will aleviate a bit by then and you could do much better. I also believe that housing could really tank in the 2010 to 2015 years so you may not want to hold it through that difficult period. If it was a good cash flow property, which is easier with a multi-unit property, then you may want to keep it until full depreciation (27 years).
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Old 03-24-2008, 09:25 AM   #26
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it's a tough decision to sell now but for me in florida, i just don't see it getting better any time soon. sure, sales might pick up eventually and so it might get easier to sell later, but i just don't see prices climbing high enough in any near future to justify holding now.
I agree. We will probably not reach those bubble prices of 2005 again in most areas of the U.S. for 20 to 30 years. That's an awful long time to wait.
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Old 03-24-2008, 10:09 AM   #27
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We will probably not reach those bubble prices of 2005 again in most areas of the U.S. for 20 to 30 years. That's an awful long time to wait.
Last time it took 12 years here (north of Boston 1988 - 1999). Process was expedited by a pretty nasty recession (1991-1993) . Still a long time to wait.
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