I Can't Seem To Make The Numbers Work On Any Rental Property
Earlier, I posted a question asking the typical expenses on rental property for repairs, improvements, vacancy, management fees, etc. The range seems to be between 25-30% to be safe. I ran the 25-30% figure on many properties I am currently evaluating, and even some properties I have evaluated over the past few months. There does not seem to be much if any room for profit. After paying the mortgage, taxes insurance and putting aside 25-30% of gross rental income for repairs, improvements, vacancy, management fees, etc., many of the properties would loose money, and some would just make around $100 a month. This $100 month is for a 3-unit property. That is just $33 a unit, and many times the profit could be just $30 or even $20 a unit. Am I missing something, or is everyone just buying rental property and not really making any money now, and hoping (speculating) on making money 10 years from now due to increased rents or appreciation (a game I think is about over). Please give me your thoughts. Thanks.
The trick is in the buy. Get the right price and you can turn a decent cash flow.
Example: I am picking up a place next week for $18.5K which will turn $600/month rent. Minimal work required (I got lucky on this one). I would normally expect about 4K of work on something like this one.
As a general rule of thumb, the higher the real estate prices are both compared to national averages and local averages, the worse you area is for cashflow on rentals. Prices for rentals vary far more widely than rents do. I was reading recently that there are some areas of the US where a negative cashflow is typical. I imagine NY city would fall into that category but I don't know that for a fact. You might have to either try to find a rehab to build equity into or try the rougher parts of town. Some people invest in other states but that has its own difficulties.
Quote:
On 2004-02-28 19:53, davmille wrote:
As a general rule of thumb, the higher the real estate prices are both compared to national averages and local averages, the worse you area is for cashflow on rentals. Prices for rentals vary far more widely than rents do. I was reading recently that there are some areas of the US where a negative cashflow is typical. I imagine NY city would fall into that category but I don't know that for a fact. You might have to either try to find a rehab to build equity into or try the rougher parts of town. Some people invest in other states but that has its own difficulties.
Los Angeles is the same way so that's why i dont buy there. There are some great areas in the US that bring in cash flow relative to rents even with zero down.
I think most of CA is like that.......I live on the outskirts of the BayArea and know I can not buy rentals here without having a negative cash flow situation...I have been driving farther North and buying properties that if I work hard at can have a small positive cash flow and will at least break even...I am hoping in time that as the properties continue to appreciate in value that I will be able to see monthly income greater than what I am seeing now.........it just seems to be a waiting game and of couse being able to jump on anyting that comes along that makes sense because if you blink it will be gone.......and the 1% rule....well if I am lucky on my buy it might work but most of the time it is more like a 1.3%-1.7%..........
Let the numbers and your common sense do the talking if they don't work they don't work. Remember this is somthing thats going to be with you for thirty years (mortgage).
Wait let people know what you want to do the right deal will come along. Remember this is a long term comitment you don't want to be struggling right out of the box you will end up quitting before you even get started. Let it make sense to you if your already dreaming about it bring yourself back to realality by running the numbers.
ED
Try out of state. I did just that a couple of years ago, found a great management company, did my due diligence as far as the past maintenance history, etc. I would recommend multi-units where you can offset a vacancy with 2 or 3 tennants--all on one mortgage. After all expenses for a 3-unit, I cash flow more than $400 (I had to put 25% down on $111k). That market is not so good right now so I am looking in another state now. Steve
Stapler:
In California, most investors I know are
purchasing properties anywhere from
65% of market value to 80% of market value for rental purposes depending on the area with an average cash flow per mos of $200-$300. This does not include repairs.
Another friend of mine has been buying up a storm using interest only loans with huge monthly cash flows. He has purchased 10 million dollar duplexes in the past 2 years. With California appreciating like it has the past 2-3 years, guess how much he has made
on appreciation? 10 million at 20-30%
appreciation plus the positive cash flow
is definitely some food for thought.
Best Riches,
Jeffrey Adam
[addsig]
I have done 35 deals myself over the last 15 years and I think you are right on the money. You don't make money when you first buy the property. It is only through , you hope appreciation of rents and property values while your P+I remain constant, that you make money.
In my opinion, most of the other stories are BS.
buy low as low as you can, work real hard to get good tenants, sell high
I think there are plenty of people on this site, myself included, that believe and practice the philosophy--"make your money when you buy a property". Translation--buy properties (sf, multis, mh, etc) that you know are under fmv. They are out there. You just have to look. It might take a while but I'd rather spend lots of hours looking for such a property than spending lots of hours worrying about a property that is sucking my bank account dry.
PD
I think the problem is that you are in NYC[ Edited by dave41082 on Date 04/22/2005 ]
i've evaluated alot of multi unit properties in the LA area recently, most of them in the south bay.
The prices are high, but so are the rents.
In some areas, home prices are going up almost 40% per year and alot of people are seeing an amazing amount of profit, albeit on paper.
THat's why it doesn't hurt to offer people 60-70% of their asking price. I haven't done a deal yet, but i've come close. There are people out there who have seen so much increase in value that they won't lose even if they knock off that much of their price.
I guess my calculations are different then most of the posters on this site. I believe in the traditional rule of 10% of value should be the annual rental income. But I use another one.
On invested capital (downpayment, actual for real your money in) I look for a return of about 14%. I love 25% but in a time when you have to draw lines between what a property will sell for and what its true value is, based on yields.
I except the lower figure.
Of course there are many games you can play to compensate..
For example: I built a 14 unit condo development in mid Hollywood back in 1983. When I designed it. I made it possible for these two story units to break into an up and down unit. thus increasing the amount of units to 28. Each with its own exterior entrance. Yes I put in enough parking which is semi sub.
Now if you bought that structure based on 14 units and imediately utilized it as 28, Yip! Of course you are giving up 14 two bedroom two bath units for 28 one bedroom 1 bath units. But remember the bottom part is the one with the fireplace and the larger kitchen. When you convert the uppers you put in an efficiency stove and frig and sink for kitchen. You get a bonus for the lower unit and the upper you charge in response to the market. When rents started to follow the upper rise in dwelling cost, you did well. You are responsive to the market and of course your yield is higher and higher. Naturaly you also charge for the parking.
Our purpose in design and in structure as a condo was to give convertability in case of up market or down market.
It has performed as designed. I wish I still owned it. You should see the smile on the buyer who bought it about six years ago. He calls me Boychick. I deserve it, one of my dumber moves. It is really annoying when you design an income structure to ride in two directions. The market goes up, it does what it is suposed to do and you have sold it to someone else. Of course the development as a condo was also in case of run a way up swing, you could sell the units as Condos and really clean up if you could afford the income taxes.
Ah well it educated all of my children. Lets see now, it does make them more interesting to talk to hmmm expensive deal for a little conversation.
Cry cry Lucius
<IMG
SRC="images/forum/smilies/icon_cool.gif"> <IMG SRC="images/forum/smilies/icon_cool.gif"> <IMG SRC="images/forum/smilies/icon_cool.gif"> <IMG SRC="images/forum/smilies/icon_cool.gif"> [ Edited by Lufos on Date 02/29/2004 ]
Every market has it's swings. It's can be really tough to cash flow them when they're on the top of their swings...especially if you're paying FMV.
Competitive markets also add a twist. NYC is perhaps one of the most competetive in the US (so I hear). Not that you can't make money there, but you may be up against savy investors with reasorces. Look for the deals that aren't publicly available to others.
What are the areas like that you're looking at? DISTRESSED AREAS will ALWAYS cashflow better than ritzy areas. In my neck of the woods, FMV properties in nice areas barely cashflow with 25% down. Find a deal on the wrong side of the tracks and you'll find cashflowing properties.
Make sure you're finding properties well below FMV. For example, run your numbers on a property.....and then drop the price by 25%. Does it cash flow then?
My theory is that every deal you do should make you more (not less) capable of completing more transactions in the near future. You can't accomplish that when you're using lots of your own money...especially when there's a negative cash flow.
Lastly....25-30% may not be realistic for NYC. That's what I count on here in Utah. I happen to know that NY has much higher rates of taxes and insurance, not to mention parts and labor. I'd guess it would be more like 30-40%....sorry to add to your pessimism.
This may seem like an extreme idea to you, but if your situation allows, and you really want to do this for a living, you might consider moving to an area that would be more promising. Not that you would have to move to the midwest or some other distant place. I would guess that upstate PA, or NY, or some other not too distant area would work much better than NY,NY.
Quote:
On 2004-02-28 19:07, stapler wrote:
Earlier, I posted a question asking the typical expenses on rental property for repairs, improvements, vacancy, management fees, etc. The range seems to be between 25-30% to be safe. I ran the 25-30% figure on many properties I am currently evaluating, and even some properties I have evaluated over the past few months. There does not seem to be much if any room for profit. After paying the mortgage, taxes insurance and putting aside 25-30% of gross rental income for repairs, improvements, vacancy, management fees, etc., many of the properties would loose money, and some would just make around $100 a month. This $100 month is for a 3-unit property. That is just $33 a unit, and many times the profit could be just $30 or even $20 a unit. Am I missing something, or is everyone just buying rental property and not really making any money now, and hoping (speculating) on making money 10 years from now due to increased rents or appreciation (a game I think is about over). Please give me your thoughts. Thanks.
Three things.
1. You are not missing something in the marco sense. Property normally does not provide much in the way of cash flow. Sometimes it is possible but that is not the major reason for buying. Stick with your assumptions as to costs.
2. Assume no appreciation. Then what you have is a forced savings program where someone else makes the contributions but you are the one who gets to make withdrawals. I am talking about an amortized mortgage so over time the unit is paid off.
3. If you get appreciation then great. It normally happens. Not something to bet on in the short term but it has been known to happen. If you look back 10-15 years you know what I mean. If you hold for 10-15 years you should see something similar (broadly speaking).
As the others notes, you can definitely work a bit harder to make sure you only buy under market deals. If you have an income from a job you might also see some tax benefits (using the US gov. as a silent partner). Figure that in 5 years rents might have risen so the margins will get better.
John
As mentioned previously, the area is the driving factor. Having worked in the Atlanta, Chicago and Pittsburgh markets I can tell you that Pittsburgh provides me with the best cashflow. While Chicago gives me the best appreciation. This is generally speaking, of course.
Quote:
On 2004-02-28 21:25, BMan wrote:
I think most of CA is like that.......I live on the outskirts of the BayArea and know I can not buy rentals here without having a negative cash flow situation...I have been driving farther North and buying properties that if I work hard at can have a small positive cash flow and will at least break even...I am hoping in time that as the properties continue to appreciate in value that I will be able to see monthly income greater than what I am seeing now.........it just seems to be a waiting game and of couse being able to jump on anyting that comes along that makes sense because if you blink it will be gone.......and the 1% rule....well if I am lucky on my buy it might work but most of the time it is more like a 1.3%-1.7%.......... <IMG SRC="images/forum/smilies/icon_eek.gif">
I see people who buy ares in very very bad hoods and pay gangs to "protect" their appartments. They are making a kiling but some of us are not going to do that. I have another question. How does one get a property below market with no cash down? I know there are hard money lenders, so they can lend 100% if it is 65% LTV but the interest is high and I have good credit. And I've been told by a broker for commercial loans they expect a seasoning for 3 years. I cant believe that. otherwise I do the hard money if i could turn around and refi it out. Or i do a line a credit perhaps. How does one work these properties. Ask owner to carry part of it? I am still wrapping my mind around the creative financing process.
Quote:
On 2004-02-28 22:32, reagan wrote:
Try out of state. I did just that a couple of years ago, found a great management company, did my due diligence as far as the past maintenance history, etc. I would recommend multi-units where you can offset a vacancy with 2 or 3 tennants--all on one mortgage. After all expenses for a 3-unit, I cash flow more than $400 (I had to put 25% down on $111k). That market is not so good right now so I am looking in another state now. Steve
Out of state is the way to go. If you live in a quirky state with hyper inflated prices, and very little housing stock, then you're not going to get good deals. Most areas in CA have rent control as well.
I think you may get your chance to pick up real estate at a more reasonable price in the near future.
http://www.bcaresearch.com/public/highlights.asp?pre=PRE-20040305.GIF
SInce I am new to RE investing - I will ask this question based on this message string.... What about the financing? I know that Washington Mutual has a 1 month option arm product currently at around 3% interest - (the index is the MTA and it is currently at 1.657 plus the margin) Doing research the index has not been about 4% in about 9 years.
With such a product (which is also assumable) couldn't a person cash flow a higher priced property if that's the market we happen to be in?
tmpringle301,
Interesting idea. However, I wonder if anyone would dare to build up a substantial portfolio of properties without knowing what their mortgage payments will be in the future?
i look for properties that may not provide excellent cash flow today,but when financed on 15 yr basis break even or maybe even slight negative. manage myself find good renters and keep filled. adjust rents annually. 4-6 yrs later can take equity or leverage for other acquitions.30 year finance has created little equity and appreciation if any is same.kinda like small piece of candy vs the whole www.box.run the numbers
I live in the midwest and I'm in the same boat. Rents are low and the costs are HIGH! I have not found THE property yet... so check every market before physically moving to a new area.
Clearly you would have to be comfortable with the worst case scenario - on this loan the life cap is 8.95% which is not great - but STILL not horrible considering alternative financing sources. Your payment can only go up 7.5% per year and yes there can be neg am.
I have this loan on both my primary residence and shore property and I absolutely love it. If you find your payments and rates start to creep up your protected against payment shock, you've enjoyed a low rate and positive cash flow for a while, and you can sell it with an assumable loan to another investor.
Again, I am just starting out but am a firm believer in using the mortgage to make the deal work.
tmpringle301,
That does sound like it might work well for some people. I personally buy my properties with the intention of holding them indefinately. My own preference in loans has changed recently since it looks like there will be softness in housing prices(rents also?) in the near future. I have gone to 30 yr financing, and then I automatically add enough to principle each month to turn them into 15 and 20 yr loans. That way I can always stop the additional principal payments and have the extra cashflow if conditions warrant. You can't play the game unless you can stay in the game is my motto.
So if I want to make a decent cashflow, I probably shouldn't refinance for cashout?
Sorry to jump in out of the blue, but I'm buying someproperties and at the purchase price and repairs cost, I could pull some pretty good money every month, but i thought if i refinanced and pulled some money out, i could move on to other things as well. If a house is worth 75k, I buy it at 39k plus 7 k repairs, should I finance just what I have to? Or should I try to pull some money out? I'd like to pull out some cash and still make a decent cashflow.
JB
So you have the numbers to answer me, rent $650, taxes 700/yr, insur. (500/yr ?) and management is 10%.
[addsig]
I have ten units in Columbus, Ohio. The appreciation here is not as good as it is on the east coast, but I have seen the values of these propeties appreciate at an extremely healthy rate. The rents, however, have not kept pace.
A duplex I purchased in 1993 for $96,000 rented for a total of $1100 in 93. The property is now worth $220,000 but the total rent has only gone up to $1700.
Certainly, there is some point at which it makes more sense to sell the property and keep the appreciation than it does to keep it. I worry that the appreciation may end if the interest rates rise substantially.
How do you determine the point at which you would sell a property?
[addsig]
Wow, you received quite a few informed responses. For what it's worth, I feel your pain. You're in NYC, I'm in Boston, someone from DC posted- we are all in the Northeast corridor. Acquire and hold properties in this part of the country seldom meet the conventional wisdom with regard to investment returns. (and you can forget about this wholesale buying at 70% of value that you read about in other posts.)
You received some very solid advice so I will only add unmentioned ideas or specifics.
1) Put more down: Some of my investors who want nothing but to have their money in RE put up to 50% down in order to better the return.
2) Consider other areas: You New Yorkers have driven up prices everywhere! (Coastal Maine, Western MA, 60% of CT, etc. etc.). Perhaps there are a few areas that have been forgotten about. Shelter Island has got high returns on summer rentals. I don't know if the #'s work. Perhaps worth a look. I did something (long term) in western MA recently. I'm surronded by New Yorkers there and happy with the property's performance. Lastly, I hear Park Slope and Cobble Hill still have opportunity. Good Luck!
Just to get in on the conversation here I'm gonna add my $.02. Other investors mentioned that you make money when you buy, and I've got to voice my opinion and agree with that. If you're buying at 70 or 80 cents on the dollar it's hard for me to imagine that you could not make it work. You're getting such a discount to FMV and there are many more options available to you. I'm currently working on acquiring one such property (short sale from bank). I believe the key is to find your classic motivated seller and buy right. It'll eliminate most of your headaches if you bought properly.
Ryan J. Schnabel
Hear, hear! This is another fantastic, well-informed post. I am in NY and we have looked at about a dozen markets in the PA, NJ, NY, CT, MA, and RI areas.
Some thoughts:
Rental real estate is a long term wealth building tool, not an income tool. To some degree, today's buyers are using it as a 401k replacement based on the assumption of higher yield, lower volatility, and diversification away from financial asset return patterns (increasingly very correlated...you can't just invest in Scudder Intl Fund to get away from SP500 risk...this also explains hedge fund popularity). There is also the drive towards the tangible since Sept 11....in particular the NYC psyche was affected a lot more than other cities...I was across the street when the planes hit...I see it in friends and colleagues every week.
You can get some higher current income with lower LTVs; even then, historically, in these markets total long-run returns decompose ~75/25 in favor of appreciation. I wouldn't count on that at this time; prices are pretty high. A better short term income tool would be development, but that is very risky, very capital intensive, often requires extreme local market knowledge (esp today) a team of RE professionals, etc and not something I would want to do at this stage of these markets lifecycle right now (I stopped all such activity myself last year)
You can think of this area if RE investing as having debt type returns (with equity upside, so really a convertible bond but let's keep it simple). Today's rental deals are basically zero coupon bonds with an imputed yield due to equity accretion (as your tenants pay down the mortgage) but essentially no current income. Zeros have also been a popular retirement tool in the financial services community...this is the non-financial equivalent. On another level, people are trying to match asset and liability duration like a pension fund would. This kind of REI has a long established history as retirement planning
Prices are also being driven up by price insensitive 1031 buyers (in the commercial area, ever seen the full pg ads in the NE RE Journal, etc..."Our buyer MUST deploy ___million in 90 days...looking for triple net" etc) and non 1031 buyers who are simply trading up appreciated assets. When we sold first trade up homes in upscale communities...didn't really matter whether the home was $1.4m, $1.5m, etc b/c buyers were trading out of homes for $900k they paid $550k for 3 years earlier and certainly had the DI ratios to handle larger notes
Everyone in the principal wealth generating centers (NYC, Boston, etc) drove prices up in their own back yard years ago and now are probably in your back yard yield shopping (e.g.) in Boston South Shore ~1998+, Worcester ~1999+, now Springfield ~2002+. New Yorkers are combing the streets of Waterbury and Hartford CT as we speak...and so on. I can tell you with authority some are being sold real krap, whether they only know enough to be dangerous, everyone knows they are in from Boston, NY, etc. I've also seen a return of the sight unseen bid. Just very dangerous stuff.
Cheap debt alone has inflated prices (called a financing premium) probably 15-20+% depending on the market. Lending terms have gotten much, much looser over the past 10 years. How many 90, 95, 100 LTV NOO investor loans back then? Loans subject to improved value that FHA 203b helped get going, etc. Easy terms, low rates, deadly combo. Right now everyone is gorging themselves before the party ends on the expectation of post-election year rise in interest rates and Kerry in the WH.
BTW, go with 30 yr debt for the optionality; set a prepmt plan to amortize to your need (15 yrs, 25...etc). Never lock yourself in to going short. Not with 40 yr lows on these rates.
Expense ratios are highly variable...talk to investors and brokers in the local markets. I wish investor groups and landlord associations would systematically collect this info in various markets...like an anonymous survey that participants get the results of. Institutions do it - and I have all the ULI multi-family & REIT data, etc...but it wont help much unless you own big buildings. You have to be mindful of what is truly fixed and what is truly variable. Suppose you had a duplex rented out to two different people and one side pd $2,000/mo and the other $3,000. Which costs would really scale with rent? At 30%, will unit A be expected to have 600/mo expenses and unit B 900? probably not Some markets like Northern NJ, the rents are so high, the fixed nature of things like taxes and insurance yield 20-25% ratios even on older properties. Bridgeport, CT has the highest tax rate in the US. 25% there won't even cover basics like taxes, insurance and sewer (the rents are lower, too). Western MA easily shows 35-45% cost ratios in those old Victorians ("three deckers" you guys call them). I bid on a 40 unit property that had a 52% ratio (yes, unbelievable, I was given really good and verifiable numbers!)
The rules don't apply here. If you ask for 3 years of 1040Es for a 2-4 family, they either don't know what that is, think you are with the IRS, or just refuse b/c there is a deli line of people lining up to buy the property. BTW, 1040Es on small 2-4 unit properties are almost always a complete work of fiction and won't tell you much they are so far from reality. Ideally you should be in a position of local market knowledge that you could tell them what it should have been. For larger commercial properties, absolutely get them and take them with a grain of salt. For you, exp are deflated and income inflated prob 90+% of time; for tax man, reverse is true 99.44% of the time. Contingencies to vacate certain or all tenants as a condition of closing? In general, forget it. In places with rent control (northern NJ) watch out.
So you want yield/be a LL with high LTVs and have the best of all worlds...it can be done...but it is not easy. Rather than just saying it's not easy, I'll suggest a few ways it could probably work in these markets based on having found enough deals with likely stabilized double digit cap rates - and I welcome and encourage suggestions/findings of others as this is by no means meant to be exhaustive
1. Rooming houses...if it's legit with the local building/health dept (often they are approved to X people and they are stuffed with 1.6x to boost rent rolls in advance of an impending sale) these can be huge generators of cash flow. Collecting rent week to week? Evictions? Transients? The rep that they are the home to a fair share of runaways and prostitutes. Won't comment. It is management intensive; your neighbors will likely hate you if that's a clue. In a tough neighborhood, it will attract dealing since there is no red flag for residents/neighbors like 'hey they dont live here' or 'that's a lot of foot traffic for one house' etc. Structurally, it works b/c you are simply maximizing residential density. Think of it like a Millers Analogy Test Single-family : Multi-family as Multi-family : Rooming house or the difference between compounding monthly and continuously
2. People on Various forms of State Aid. These are liberal, wealthy states with lots of social programs. A. Mentally or physically handicapped that are learning/re-learning life skills as an adult; states pay boosted rents for them since they have few other options and your facility will redefine the ADA standard by the time they're done with inspections/retrofitting if needed (ever seen an ADA labelled tape measure) Buy exisitng or build greefield...don't convert. You can't imagine the cost. B. Displaced/near-homeless people that tend to have very short stays...the states often pay very, very well for rooming for these people...monthly rates that can border on 30 days of nighly hotel rates. Vacancies and lack of dependable income will be a way of life since this has huge variability. Insurance companies looking to place people short-term with P&C losses. C. Section 8. I won't get into it here since there are books, forums, gurus, etc that cover this topic. You'll get above market rent in many areas 9watch out for Section 8 drying up though) partially as an inducement to get LL to take them. Beware!Lots of people are of late pricing their property on the basis of having filled it with above market Sec 8 rent or presumed Sec 8 rent. More speculation. Many are sold by rehabbers with extreme (read, lifelong in the community) local market knowledge, and know enough to sit down with one of the housing authorities and get the right person to boost the rent 10-20+% (Sec 8 rent is negotiable anyway, but this is real boosting). Trust me, I have talked to a number of rehabbers and the environment they see now makes them drool until they're thirsty. They need bibs. They are giddy.
3. Get tough. If you go into some tougher areas of the larger cities (NOT NYC or Boston) you can get double digit going in cap rates. But you will have to think about over time what's a going in cap rate and whats a stabilized cap rate. If property values fall, and you are at 95+ LTV, you had better have lots of reserves or lock everything up in standalone non-recourse LLCs, b/c when the bank runs a portfolio valuation on you in 3 years, you will have a sizable negative net worth if you have bought a few of these and they won't loan you a pencil sharpener (vicious this thing capitalism b/c credit tightening, higher interest rates, falling property values and rents etc are all too often correlated if not simultaneous).
4. Tralier parks/MH. Yes, they aren't just in KS. There are plenty right here...they are relatively small and your local communities have often buried them behind the aluminum recycling plant, but they are there. Big cap rates, mgt intensive, ugly, ugly debt. Wont cash flow as much as they first look, but there are REITs devoted to this and most people overlook the opportunity.
Well, it's 5:55 AM and I'm going to bed. Hope that helped
[ Edited by dealjunky on Date 04/03/2004 ][ Edited by dealjunky on Date 04/03/2004 ]
I have been a landlord in CT for 9yrs. My properties net $800 or better cash flow. I have 3unit buildings.
However, lately the NY crowd has come in and pushed prices up past the point where I can continue to make the above cashflow on the retail market. I have just contracted for 2 more 3 unit blds bought directly by owners who are older and sick of landlording.
I can no longer look in the MLS and find a decent property so I have begun a marketing campaign of "we buy houses" and sending postcards. My former traditional method of using an agent to buy property has become unprofitable.
I am presently waiting for the sky to fall because the method of purchasing based on appreciation is speculation and I don't invest this way.