Tour de France and Real Estate!

Well today is stage 11 of the Tour de France and it looks like Lance Armstrong is Living Strong!  Armstrong is currently in thrid place 8 seconds behind the leader.  Historically, this is where he has been when he won the past tours.  Of course nothing is guaranteed and there are the 4 toughest stages coming up in the next few days, but Lance Armstrong is Lance Armstrong.

Why do I mention Lance Armstrong with real estate?  Well, he is one of those rare atheletes who does things for the long term.  He looks at things with a larger goal in mind.  He is not here to just win a time trial or a stage, he looks at the entire race.  Real estate and real estate investment, has much in common.  In recent years investors have treated real estate as a quick short term way to make millions.  Many have succeeded and made a lot of money, but also many have stretched beyond their capabilities and lost millions.

Think about the Tour de France, in order to suceed, you must know your strengths.  Lance Armstrong knows his weakness is the time trials; there are more powerful riders who excell at the time trials.  Armstrong is built for the long haul weighing less than 170 pounds.  The time trial riders usually weigh more and have more muscle mass.

In real estate, you may have $100,000 to invest in real estate, but if you cannot keep the payments going until your investment matures, you will lose in the longterm.  You must project at least 10 years ahead to see where you money should go.

People ask me, “Mike, when should I buy?”.  There are two answers: 

1. You should buy when you have the resources to make the payments for the longterm.

2. The payments should be less than 30% of your monthly income.

Simply put, live within your means and buy in an area that will generally appreciate when other areas decline.  Even more simply put, buy in www.NorthwoodPointeIrvine.com .   This last sentence says it all!  Trust me, I have been working in this area for 10 years now and have seen some amazing returns on investments in this secluded quiet family enclave.

Come visit me this weekend at my open house at 22 Blue Spruce and we can discuss the market and some amazing investment opportunities.  Also, go to www.MichaelDunn.com  and click on MLS search,  Irvine and then NW and the year 1995 and newere and you will be pleasantly amazed at the wonderful inventory of homes.

Mike

Posted: July 15th, 2009 under Hot Tips, Real Estate News.
Comments: none

Google searches and Real Estate!

Usually I search for the top Google searches to steer traffic to my blog, but the past two weeks have been the most negative I have seen in a while.  Death, extra marital affairs, airplane crashes.

Every morning when I check the CNN news updates, the top 5 out of ten lines are all grossly negative.  The old adage, “no news, is good news” holds true.  Speaking of no news, here is some “no news” for you:

The quiet neighborhood of Northwood Pointe in Irvine, California, is doing something that no other neighborhood in Orange County or in the United States, is doing.  The prices for homes under $1.3M, are beginning to rise again.  For the first time in 2 years, the last sale was higher than the one before.  Not sure if this means we have hit bottom, but it is a good sign that perhaps we are close; at least in the $1M and under price range.  The jumbo price range, homes that exceed the $729,000 loan amount when putting down 25%, are still floundering.  It shows the lack of available cash to most people.

I see the high end homes hitting bottom in December of this year.

If you have not visit Irvine, California, I suggets you do.  It is the most brilliantly designed “town” I have seen.  Easy access to major freeways, from anywhere.  It has more trees that some rainforests.  The streets are cleaner than a Mircrosoft computer chip lab.  I have yet to see any graffiti. 

In short, this is the place to live.  Yes, I understand when you say: “But Mike, the prices are so high compared to other areas.  How can we afford to buy?”  Good question.  Irvine has something for everyone.  You can buy a one bedroom condo for less than $200,000 (In Austin , Texas this buys you a 4 bedrooms, 2,500 square feet house).  Seven years ago I bought a one bedroom condo for $150,000 and 2 years later sold it for $310,000.  That same house in Austin went from $150,000 to $200,000 in the same time period.  The appreciation rate here is much higher than anywhere on Earth.

So my point is, invest here because it will always go up and if it goes down, it does not go down as much as other places.

Please feel free to join me at one of my upcoming open houses and we can discuss the real estate market.  In the meantime, feel free to go to http://www.michaeldunn.com/real_estate/searchMLS.asp and see the homes I spoke of.

Enjoy your day.

Mike

Posted: July 5th, 2009 under Hot Tips, Real Estate News.
Comments: none