Ho-ly shit.  

"BigBlock440" (440-4bbl) 04/11/2018 at 12:53 • Filed to: None

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I knew west coast housing prices were nuts, but this is probably the best example I’ve seen. And people are saying in the comments that it’s a good deal.

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BrianGriffin thinks “reliable” is just a state of mind > BigBlock440 04/11/2018 at 13:05

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Stuff costs what stuff costs in the real estate market, unfortunately. Who knows, in twenty years that shack may be worth $5M

TheBloody, Oppositelock lives on in our shitposts. > BigBlock440 04/11/2018 at 13:07

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Really you’re paying for the land.

boredalways > BigBlock440 04/11/2018 at 13:08

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Yes, it’s a very good deal. Honestly, paying asking price would be “lowballing”. It will sell for more.

Glad I got the fuck out of there back in 2006. Would have been around 350-400K back then.

BigBlock440 > BrianGriffin thinks “reliable” is just a state of mind 04/11/2018 at 13:10

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I wonder how much that shack is actually worth. I guess the difference in permits or taxes or whatever, but not really caring about left coast real estate, I don’t know how much that number is. On this side of the country, it wouldn’t be all that much, but some people in the comments are talking like it’s a huge difference.

Sampsonite24-Earth's Least Likeliest Hero > BigBlock440 04/11/2018 at 13:16

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the shack isnt worth that much but the land is

Rusty Vandura - www.tinyurl.com/keepoppo > BigBlock440 04/11/2018 at 13:25

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You pay for the weather and they throw in a house as a bonus. It’s a fact of life in these parts. They’re buying a parcel of land.

BigBlock440 > TheBloody, Oppositelock lives on in our shitposts. 04/11/2018 at 13:30

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Which isn’t all that impressive either

Rusty Vandura - www.tinyurl.com/keepoppo > BigBlock440 04/11/2018 at 13:32

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I bet there are some pockets in Pittsburgh that are pretty pricey. But weather and salt on the roads...

My house was $160k when I bought it 21 years ago. Today, the same unimproved home would fetch half a million dollars. Fortunately, because Prop 13, I’m not taxed based upon what the family pays next door. Today, I would never be able to settle here. There’s a house two doors down from me — exact same plan as my house — built circa 1950, 900 sq ft, 2BR/1BA, one-car garage that’s up for rent. Landlord is listing at $2,700/mo. They won’t get that much, but it’ll probably get $2,000/mo. Thank you Facebook, Google, Apple, Oracle, Tesla , and others that I cannot think of.

CalzoneGolem > TheBloody, Oppositelock lives on in our shitposts. 04/11/2018 at 13:34

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Nah you’re also paying for the pre-existing structure that you can “renovate” instead of getting permits for a new construction.

victor > BigBlock440 04/11/2018 at 13:38

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Granted my house is in Mountain View, but it’s a 3bed/2bath 1400 sq ft home on a 6000 sq ft lot, and it has been remodeled in the last 5-6 years. The market transaction value is approx. $2.5M depending on shape. When we bought it, it was less than 1/2 that. In 2001, it was worth $600K. In the mid 90s, it was $300K.

Thank Google for that.

BLCKSTRM > BigBlock440 04/11/2018 at 13:43

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It’s a good deal because the fire took care of a lot of the demo expense.

BigBlock440 > Rusty Vandura - www.tinyurl.com/keepoppo 04/11/2018 at 13:50

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I meant the cost difference in permitting between existing “structure” to renovate vs build new wouldn’t be that much different. But I’d be surprised if anywhere in Pittsburgh even came within 10% of this.

Edit: yup, just did a search on realtor.com for Pittsburgh, Anything even approaching 3/4 million is 6+ bedroom, 3k+ square foot, and look maintained in the pictures. NYC is probably crazy too, but that’s a bit more built up than what it looks like in those pictures.

Rusty Vandura - www.tinyurl.com/keepoppo > BigBlock440 04/11/2018 at 14:02

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I’d think NYC would be in a category by itself. They do a trick around here where they tear down the entire house except for maybe part of one wall where the electrical is attached and call that not a teardown. I’d be curious to see if that $800k shell gets raised or not. People have so much money to spend on a house that it’s silly. Normal people can’t compete because someone comes along with cash and offers tens of thousands over asking price. But I don’t know where we’d move because it’s pretty okay here, not least, because no snow and no salt.

E92M3 > Rusty Vandura - www.tinyurl.com/keepoppo 04/11/2018 at 15:46

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$2000 rent on a $500k home? That’s a terrible ROI.

Rusty Vandura - www.tinyurl.com/keepoppo > E92M3 04/11/2018 at 17:06

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Wouldn’t that depend in large part on how heavily leveraged you were on the property?

E92M3 > Rusty Vandura - www.tinyurl.com/keepoppo 04/11/2018 at 17:56

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Not really, if you put the minimum down payment down, your cash flow each month would be negative.

It just doesn’t make sense to have rentals out there. They must be chasing speculation only. Renters help cover the mortgage, and hope to make your money in appreciation.

Just for a comparison 250k houses here rent for $1800 a month.

Rusty Vandura - www.tinyurl.com/keepoppo > E92M3 04/11/2018 at 21:54

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You sound like you know more about this sort of thing than I do, but at $2,000/mo, in simple terms, $500,000 would earn you 4.8% annually, if I do the arithmetic correctly. Not a huge ROI. 6% at $2500/mo.

So what’s the point of owning extra houses then, anyhow? (I’m a crappy businessman, anyhow; I own that fact.)

E92M3 > Rusty Vandura - www.tinyurl.com/keepoppo 04/12/2018 at 00:27

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Just a quick rule of thumb, most real estate investors will not even consider a house that the gross monthly rent isn’t at least equal to 1% of the houses current value. Every $100k in value should equal $1000 in rent (before expenses).

The one good thing about rental property is you get to write off the depreciation over 27.5 years. The house is an asset used to generate revenue just like a piece of heavy equipment is to a grading company. So most years that will get you real close to negating the taxable income of the property. Even with that benefit it just doesn’t make sense cash flow wise, unless you want to gamble that the house will appreciate in value rapidly and can wait to take your gain. Which btw you’ll have to pay taxes on the appreciation when you sell the house (unless you immediately use the money to rollover/purchase more properties). Most financial advisors say to never buy a house based on speculation of appreciation. Any number of unforseen things could happen to cause an economic downturn, and “while past performance can be nice look at for trends, it does not guarantee the future”.

pip bip - choose Corrour > BigBlock440 04/12/2018 at 07:17

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cheaper than Melbourne