Comments on: Ask Us: Why The Fuss About Noe Valley?

By: zanon

zanon — Wed, 03 Jun 2009 21:36:11 +0000

FLUJ: Cool.

ANON: Lots of variables there. They bought it for less in the past, so could be cash flow positive at a lower amount. I like looking at rent/buy breakevens, because when it’s about the same to rent as to buy, you *know* you’ve hit the bottom. This is actually the case in East Bay.

If you buy multi-family properties you can find stuff that’s cash flow positive, but nothing like that exists in my area (PA), and I don’t know if anything like that exists in the nice parts of SF.

SPARKY: All my estimates are on 20% down, current rates.

By: sparky

sparky — Wed, 03 Jun 2009 21:20:36 +0000

My full amortized is about $3200 on a house that cost $800K. It depends how much they put down on the place, what their rate is, and how long they have lived there.

By: anon

anon — Wed, 03 Jun 2009 19:45:50 +0000

Fluj, why can’t you advise them if they should should rent or sell? Say if a “family” member was the owner, what would you tell them?

Lets take a wild guess and assume the purchase price was north of $700k. $3,000 rent will not make it cash positive. Is this correct math?

[Editor's Note: Sorry, your comment was held in spam...no idea why.]

By: fluj

fluj — Wed, 03 Jun 2009 19:11:11 +0000

anon,

I’m talking about two different properties here.

zanon,

They’re angling for more than 3000, and it’s looking pretty good. I’ll let you know what happened once it’s a wrap.

By: anon

anon — Wed, 03 Jun 2009 18:54:25 +0000

I’m so confused – You went to see the property… then – oh wow! It turns out to be your listing? OK – weird. Why didn’t you jsut say it was your listing in the first comment?

By: zanon

zanon — Wed, 03 Jun 2009 18:47:26 +0000

FLUJ: Cash flow positive at $3K/mo would have the property valued at about $500K. Is that right?

By: lily

lily — Wed, 03 Jun 2009 18:23:47 +0000

I can’t speak to whether the pricepoint is real or not, not knowing anything about the property or price, but it sounds like you are a good agent in that you are looking out for your clients’ best interest instead of yours.

By: fluj

fluj — Wed, 03 Jun 2009 17:10:07 +0000

The reason the property is still listed is because the pricepoint is real. There’s no smoke and mirrors. All of the offers have been 6 or 7 % under asking. The sellers have moved away for two years, for school. But they are getting all sorts of rental interest for $3000+/month. And that would be cash flow positive in the sellers’ absence. Why should the sellers take a hit on their downpayment when they can rent for cash flow positive in their absence? I can’t advise them to do that. Despite the fact that they don’t wish to be absentee landlords.

By: lily

lily — Wed, 03 Jun 2009 04:20:59 +0000

Fluj,
if you have listing that is getting offers then why is it still listed? I’m confused if things are only down a few percent then the offers should be reflecting that.

By: fluj

fluj — Tue, 02 Jun 2009 21:02:58 +0000

I went to see the 30th street property today, and …. I misspoke. It’s not underpriced. It’s a cool property but not for everyone. The bedrooms are on three different floors, the kids’ room has the big view, the lower floor is more like an enormous office than a bedroom, the lower master has has wide open windows facing the backyard. All in all I liked it. But the photos do it a world of good.