Again, how it relate to your original assertion (see the quote)? I wasn’t talking about price forecast.
Someone who bought has to peak now has to ride it through the entire decline phase to recover the principal. That is why you want to not invest in a market where the principal is at risk.
Just by sheer inflation rent will catch up to make your rental in BA cash flow positive. Assuming 1) no rent control and 2) fixed rate mortgage. Anyone seen any counter example?
Because I got a very stiff challenge when I first said these things. Probably only you were are little appreciative of the idea probably because of your Austin experience. That is why I said fortune-telling business. But, at the end looks like it turned out to be a dumb joke. Sorry.
Plenty. If you bother to research into past data. Anyhoo, the initial recovery from 2009-2011 is not due inflation, is recovering from the undershoot and then by fundamentals (desirability of BARE due to prosperity of tech companies). From 2017 to 2018, it overshoot. Remember inflation is low 
and the house price appreciates way faster than inflation. If it is only inflation, I dare say, positive cashflow can’t be achieved.
Long term average BA housing appreciation is about 6%. I remember @manch did some research on this subject.
Post-war 6-8%, some neighborhoods a little lower, some neighborhoods a little higher.
6% is not just inflation. It reflects the increasing desirability of SV.
Anyhoo, we are talking about rental yield when talking about cash flow.
Construction is continuing in Tahoe. My tenants have all paid rent except for a couple that will pay by the 10th. Next month who knows? The ones that were laid off are still waiting for their unemployment checks. Those should keep them going for a few months.
The rubber will hit the road by June. If the quarantine continues then through summer then we will have a 1930s style depression and Trump will go down like Hoover to be the worst president. It’s the economy stupid, as he well knows. But this virus controls everything.
2 Likes
Reopening the economy will be gradual. Don’t expect things to snap back to normal on any one given date. It’s more likely some shops will be allowed to open before others, maybe at reduced capacity and reduced hours. China is supposedly open for business now but still people worry about contracting the virus. Even open shops don’t have many customers.
My guess is that Bay Area may start to very gradually reopen after Memorial Day?
1 Like
I hope sooner. we are definitely header for an extended U or L shaped recovery if this stretched into the summer.
The silver lining is that we got knocked down by an external event. The internals of the economy was humming along just fine right before that. Remember we hit decades low unemployment in February? Now it seems like ancient history.
1 Like
Just skimmed through–noticed the discussion on people cancelling contracts. I’m not sure if anyone discussed what the mortgage companies are doing, but my neighbors were trying to refinance and said all the companies backed out on them. I wonder how many of the people backing out of contracts are due to this.
I don’t think Bay Area residential construction is deemed as essential now.
Here in Santa Cruz, I had an inspection 2 weeks ago. Back then, residential construction was “essential”, and so were inspections.
Called today to schedule the next - all inspections are on hold, until at least May.
The only work we’re permitted to do is work to secure the site (= install doors and windows).
Residential construction is no longer essential in Santa Cruz either unless there is a life/ safety issue.
1 Like
Fuck the inspections Take pictures and sue the bastards. Housing is a essential industry. Politics drive these idiots at city hall. Keep working
2 Likes
This is the black swan event that we all have been worried about. I have been planning for it for ten years. But when it hits it’s even scarier than imagined. All we can do is pray that the country gets back to work by June 1, or the economy and society will collapse.
This headline is from a year ago.
1 Like
A month after it started, which means two weeks from now, there will be very little appetite remaining for the shutdown. I think we are over the peak COVID issue. The peak is behind. People, even those who were demanding a shut down just a week or two ago, cannot be remain locked for a long period of time. I have a feeling corona-virus will stop being headline within a week or two. It is no longer a useful political issue or a medical emergency. If you survived this far, you will be OK.
Here you go;
As the San Francisco shelter-in-place order has been extended and in accordance with state law, the new property tax deadline is May 4, 2020 (the first business day after the shelter-in-place order is lifted). Taxpayers who are unable to pay by this date for reasons related to COVID-19 should submit a request for a penalty waiver request online. Please note that penalty waiver requests will not accepted until after the property tax deadline.
.
.
1 Like