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SoCal commercial real estate markets

 This Los Angeles commercial real estate conference seemed bullish on commercial and concerned about residential real estate. Michael Pralle, CEO of GE Real Estate, said in his keynote speech that U.S. market indicators are “mostly favorable,” with business profits and GDP growth expected to remain strong and long-term interest rates and inflation low. “Rents and vacancy rates in most U.S. markets are the best I’ve seen in seven years at GE. There’s a wall of liquidity for real estate transactions “The biggest worry for the U.S. economy is whether or not the housing downturn will lead to a diminution of people’s perception of their wealth,” Pralle said. “How much your…

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“The Assessor’s Office is nothing more than a slush fund”

 Wow! “The Assessor’s Office is nothing more than a slush fund for the politically powerful in the state,” he said. It’s in the power brokers’ interest to have the assessor increase property values so tax revenues go up without a public vote to raise the tax rates, he observed. Residents pay more, but the elected officials look like the good guys touting “no tax increases.” No wonder they ran him out of office.

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Desert gardening tips

 Dang! I wasn’t able to make the garden tours last Sunday or this weekend. (It’s the busiest time of year for Realtors.) The Valley of the Sun Gardeners has a nice little page with tips about desert gardening.

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Who took advantage of who with sub-prime loans?

 The borrower may argue that he didn’t understand what was going on and the loan officer pushed him into a bad loan. The loan officer, however, may argue that the borrower lied on his applications so, of course, the loan was not appropriate for him. I’ve seen different numbers. This blurb says, “About 50 percent of the subprime mortgages were ‘stated income loans,’ with no verification of borrowers’ incomes.” But then again, the loan officer probably accepted the borrower’s obviously bogus stated income to get the deal done. So was it the loan officers and borrowers working together to take advantage of the lenders?

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Yet another doomsday scenario… but Arizona real estate wins in this one!

 Journalists seem to have a biological craving for end-of-the-world, no-way-out stories. This story was simply unstoppable because it also included Baby Boomer bashing. Journalists feel smug and fuzzy just thinking about it. However, this Boston-real-estate-is-doomed article does have one unfortunate side effect. It assumes that real estate in areas like Arizona will do very well. I guess the writer assumed that no one in Arizona would read the article so he wouldn’t get kicked out of the club. And I love this bit. The boomers’ and busters’ influence on the housing market has never been easy to predict. In 1989, economists Greg Mankiw and David Weil, then both at Harvard…

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The keys to investing in residential real estate today

 This was written about investing in Seattle, Washington real estate, but it’s very true for Arizona real estate investing as well. Try to find a property that you can buy at a low enough price, and with low enough mortgage payments, to at least break even with your monthly rent income. That probably means making a fairly big down payment of 10 to 20 percent and shopping very hard to find a decent deal. If possible, try to stay within a 30- to 45-minute drive from your home in order to make it easier to rent and manage the property. However, you may have to go farther out if you…

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