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Easy 1% Valuation

By REpro following x   2012 Feb 5, 1:51pm 2,261 views   6 comments   watch   nsfw   quote     share    


Many house buying calculator, less or more complicated, look for a point where buying a house have financial sense.
There is other easy way: Consider typical house/condo, typical in size, age, and condition for any given neighborhood in US.( It’s not working only for areas were people run away/flock in big number or places where money are not an object.) Tenants by choosing place and accepting price made most of research work for you.
The simplest, oldest, no-brain, minimum risk, highest return, blind shot, healthiest, regardless on current inflation, regardless of current loan rate, state of politics, unemployment, supply/demand, media brain wash, f* me twice Sunday, is: Buy when Monthly Rent of the place you going to buy, represents about 1% or more of Purchase Price.
Examples for random places in US:
http://www.zillow.com/homedetails/13879-44th-Pl-N-West-Palm-Beach-FL-33411/46495821_zpid/
http://www.zillow.com/homedetails/3445-Stratford-Rd-NE-APT-1807-Atlanta-GA-30326/82618873_zpid/
http://www.zillow.com/homedetails/1827-E-Ellis-St-Phoenix-AZ-85042/60314239_zpid/
http://www.zillow.com/homedetails/2-W-Main-St-206-Boston-MA-02126/2133565495_zpid/
http://www.zillow.com/homedetails/121-Myer-St-UNIT-102-Hackensack-NJ-07601/2130385271_zpid/
http://www.zillow.com/homedetails/3862-S-Lake-Park-Ave-UNIT-3N-Chicago-IL-60653/89968645_zpid/
http://www.zillow.com/homedetails/3562-Marlborough-Ave-UNIT-14-San-Diego-CA-92105/72149573_zpid/
http://www.zillow.com/homedetails/2824-NW-Kennedy-Ct-Portland-OR-97229/2146636392_zpid/
http://www.zillow.com/homedetails/935-Spring-Valley-Plz-Richardson-TX-75080/67959642_zpid/

1   Bigsby   ignore (10)   2012 Feb 5, 1:59pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

So current $500-550k houses that rent in Monterey for $2200-2500 are only ripe for purchase when their valuation drops to $220-250k? I don't think so.

2   REpro   ignore (0)   2012 Feb 5, 2:28pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

REpro says

It’s not working only for areas were people run away/flock in big number or places where money are not an object

Bigsby says

So current $500-550k houses that rent in Monterey for $2200-2500 are only ripe for purchase when their valuation drops to $220-250k?

Pretty close to your area: http://www.zillow.com/homedetails/451-Dela-Vina-Ave-APT-205-Monterey-CA-93940/19343256_zpid/

3   TPB   ignore (3)   2012 Feb 5, 2:51pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

That first house is a hell of a deal, for 1.15 acres of land.

Though it is way the hell out there in the middle of nowhere.

4   Bigsby   ignore (10)   2012 Feb 5, 3:23pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

REpro says

REpro says

It’s not working only for areas were people run away/flock in big number or places where money are not an object

Bigsby says

So current $500-550k houses that rent in Monterey for $2200-2500 are only ripe for purchase when their valuation drops to $220-250k?

Pretty close to your area: http://www.zillow.com/homedetails/451-Dela-Vina-Ave-APT-205-Monterey-CA-93940/19343256_zpid/

The idea that buying should only be done when rent is 1%+ of price is complete drivel and isn't demonstrated because you find a crappy apt that fulfills your criteria and where the rent is too high relative to price.
And anybody who rents that for $1600+ is a complete moron by the way.

5   REpro   ignore (0)   2012 Feb 5, 4:01pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Bigsby says

And anybody who rents that for $1600+ is a complete moron by the way

Buy for an investment and rent to morons then.

6   Bigsby   ignore (10)   2012 Feb 5, 4:19pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

It's obviously a very good buy if it actually rented for the Zillow estimate. That's a very big if right there. Monterey is expensive, but not that expensive.
All of which is irrelevant to your 1% idea.


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