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Started By
Message
How are people investing in real estate right now?
Posted on 1/6/26 at 11:48 am
Posted on 1/6/26 at 11:48 am
Relatively high rates, price of homes and mortgages far exceeding any rental income, vacancy risks, etc.
Tl;dr wondering if I should move some of my savings as a DP to another house. Looking at places with lower property tax and high rental (Boston area comes to mind) but seems like these days, stock market is just too hot
Tl;dr wondering if I should move some of my savings as a DP to another house. Looking at places with lower property tax and high rental (Boston area comes to mind) but seems like these days, stock market is just too hot
12
Posted on 1/6/26 at 11:49 am to fareplay
Well, some of them pay cash.
Posted on 1/6/26 at 11:51 am to GeauxTigers123
Is that even a smart move? 500k+ parked into an asset generating 3k monthly?
Posted on 1/6/26 at 11:56 am to fareplay
Not me...I am finished and I say this as a Broker.
Posted on 1/6/26 at 11:59 am to SalE
How do you view the future? I have a rental in Boston area right now and I’m debating adding more or just leaving entirely.
Posted on 1/6/26 at 12:42 pm to fareplay
same as always foreplay.
landlord friendly states, make sure RTV meets requirements, PCF standards after calculating expenses, etc.
Just sold 4 of mine this past year. Appreciation was way better than expected. Took profits and ran.
not only have prices gone up for acquisitions, but so have costs of maintenance, rent ready expenses, etc. interest rates(traditional and private lenders) turned many off also if they did not buy cash.
landlord friendly states, make sure RTV meets requirements, PCF standards after calculating expenses, etc.
Just sold 4 of mine this past year. Appreciation was way better than expected. Took profits and ran.
not only have prices gone up for acquisitions, but so have costs of maintenance, rent ready expenses, etc. interest rates(traditional and private lenders) turned many off also if they did not buy cash.
Posted on 1/6/26 at 1:01 pm to fareplay
quote:
Is that even a smart move? 500k+ parked into an asset generating 3k monthly?
that is garbage RTV and should not be used as a rental anyway.
Posted on 1/6/26 at 1:28 pm to fareplay
What are a few funds that would be good to invest in? I’m not looking for anything flashy that will be boom and bust. Something rather conservative that might have a good dividend.
Posted on 1/6/26 at 2:02 pm to fareplay
In my part of the world (greater Tampa Bay Area); the residential property market is in the tank. Houses aren’t selling and average 6 months or more on the market and usually with significant price cuts before selling.
Commercial isn’t any better. Residential rents are going down slightly as more apartments/condos and housing options have become available.
Single family home prices remain stubbornly high. Even those which are bank owned or in distress. I keep saying the prices have to undergo a significant correction; and I still believe that they will; but it hasn’t happened.
I have a friend who’s made a nice living off buying homes and renting them out. He picked them all up pre-pandemic and is handy enough to do most repairs and maintenance himself. The last I chatted with him he says there’s no way he’d be getting into buying rentals right now. He’s religious about using the 1% rule and says the Midwest/Rust Belt is about the only place where those opportunities still exist.
Commercial isn’t any better. Residential rents are going down slightly as more apartments/condos and housing options have become available.
Single family home prices remain stubbornly high. Even those which are bank owned or in distress. I keep saying the prices have to undergo a significant correction; and I still believe that they will; but it hasn’t happened.
I have a friend who’s made a nice living off buying homes and renting them out. He picked them all up pre-pandemic and is handy enough to do most repairs and maintenance himself. The last I chatted with him he says there’s no way he’d be getting into buying rentals right now. He’s religious about using the 1% rule and says the Midwest/Rust Belt is about the only place where those opportunities still exist.
Posted on 1/6/26 at 2:34 pm to wiltznucs
Great Housing Reset is upon us.
Posted on 1/6/26 at 2:36 pm to wiltznucs
quote:
He’s religious about using the 1% rule and says the Midwest/Rust Belt is about the only place where those opportunities still exist.
I believe that. In the DFW metro a 500k house will rent for like $2,800.
Now a lot of the landlord bought those house at $250k. So they are doing fine.
Posted on 1/6/26 at 2:45 pm to fareplay
Your statements are not true for all markets. There is still good cash flow where I live because rent has been increasing with costs. Vacancy rates are less than 5%. Rates are considered high because we were spoiled with an extended period of unusually low rates. My first mortgage was 12%, so it's all relative. Prices are at the high end. We look to be entering a period where we see a small pullback on prices. In my experience, these are typically short lived.
Real estate is broader than just rentals. I do mostly new residential construction these days because I am trying to retire. These are short-term projects vs long term rentals. We are in a down cycle ( for me that is a buyers market), so I am mostly buying land/lots right now and only have a couple of starts as far as building new houses. I know of a couple of investors that are killing it in commercial construction. And the biggest paydays are for those doing land development. Taking a piece of land and turning it into a subdivision of building lots is very lucrative.
Real estate is mostly local. Your experience might be quite different.
Real estate is broader than just rentals. I do mostly new residential construction these days because I am trying to retire. These are short-term projects vs long term rentals. We are in a down cycle ( for me that is a buyers market), so I am mostly buying land/lots right now and only have a couple of starts as far as building new houses. I know of a couple of investors that are killing it in commercial construction. And the biggest paydays are for those doing land development. Taking a piece of land and turning it into a subdivision of building lots is very lucrative.
Real estate is mostly local. Your experience might be quite different.
Posted on 1/6/26 at 2:45 pm to ronricks
quote:hopefully not accompanied by a bailout. Which is what probably will happen
Great Housing Reset is upon us.
Posted on 1/6/26 at 3:06 pm to wiltznucs
quote:
In my part of the world (greater Tampa Bay Area); the residential property market is in the tank.
And will be until exorbitantly high property taxes, flood and homeowners insurance get more affordable.
Posted on 1/6/26 at 3:13 pm to Paul Allen
none of those things are going to happen, that’s fantasy. Cost of acquisition however will come down
Posted on 1/6/26 at 3:21 pm to Paul Allen
quote:
And will be until exorbitantly high property taxes, flood and homeowners insurance get more affordable.
Not to mention skyrocketing utility rates. The Tampa Bay Area got three hikes last year and has approved another rate hike in the coming months. We now pay the highest rates in the country once adjusted for average household earnings.
I know a lot of people who want to leave; but, are sort of trapped. The job market here is rough. Even if they do find a job elsewhere; they know they’ll probably take a haircut if they sell their home right now. Plus they’ll likely be tied to a higher interest rate when looking for their next place. A whole lot of people who arrived in the past five years or so to live their Florida dream have come to the realization that it’s actually a nightmare.
This post was edited on 1/6/26 at 3:24 pm
Posted on 1/6/26 at 4:22 pm to fareplay
REITS. No property tax, no maintenance costs, quality ones with yields of 4-10ish%, currently trading at low values, and the share prices should skyrocket once interest rates get low enough that people move out of money market funds and treasuries & chase buy REITs for the dividends.
This post was edited on 1/6/26 at 4:24 pm
Posted on 1/6/26 at 6:56 pm to SaintsTiger
that is an excellent observation
There are plenty of ways to invest in real estate without buying and renting a house
There are plenty of ways to invest in real estate without buying and renting a house
Posted on 1/6/26 at 7:50 pm to SaintsTiger
quote:
REITS
I got out of mine last year. Gave three years to MORT and VNQ. Lost money or broke even. Might jump back in later. MORT is a Mortgage based REIT. I figured with increasing rates it would offer some potential upside. A paltry 2.2% return and fees of 0.4% last year.
I’m a Vanguard guy; so did VNQ as well. Much better fees as you’d expect with Vanguard; but, still returned only 3% last year.
I know there’s other more specialized REITS out there that probably outperformed these.
I’d of done better simply letting the money sit in a Money Market account or buying 10 year Treasuries.
Once the housing and RE market gets rolling again I’ll consider them again. In the meantime; hard pass. I’ll let MO (Altria) keep pumping me 8% for dividend plays.
Posted on 1/6/26 at 9:15 pm to fareplay
quote:
Relatively high rates, price of homes and mortgages far exceeding any rental income, vacancy risks, etc. Tl;dr wondering if I should move some of my savings as a DP to another house. Looking at places with lower property tax and high rental (Boston area comes to mind) but seems like these days, stock market is just too hot
It’s a horrible idea.
You should definitely do it.
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