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You can't miss with this real estate (if you can afford it)

Almost three months ago, I posted about nine "special" real estate markets. These markets are, in my opinion, somewhat impervious to the fluctuations of the real estate markets where us mere mortals live. Basically, the affordability factor doesn't apply here. These markets are so desireable that the wealthy will just pay cash to live there.

Here are my choices:

The Absolutely Best: The Big Apple; Midtown Manhattan. Is New York beautiful? Well, that truly is in the eye of the beholder. I don't think it is any natural wonder but it is a wonder of man's doing. Manhattan is the epicenter of the world. Does it fluctuate? Sure, a bit because the Wall Street factor is such a huge influence here. Make no mistake about it...young people should live in Manhattan...old people should live in Manhattan...EVERYONE should live there once in their life. Midtown Manhattan real estate will always be a good bet over a five year period.

The Old Guard: These are known for two things: Natural beauty and proximity to a big city while retaining a small village feel. "Old Money" towns are what you might think of when you think of these markets. They are mature, built out, and very pricey. I believe you will always make money if you buy and hold for 5-7 years in these towns. Listed, in no particular order:

READ THE LIST AT www.MortgageRatesReport.com

Posted by Brian Brady- America's VA Home Loan Broker on 11/30/2006 02:11 AM

Comments (43)

real estate, mortgage

Originally posted at: America's #1 Mortgage Broker: You can't miss with this real estate (if you can afford it)

43 Comments on You can't miss with this real estate (if you can afford it)

NOV

2006

A very enjoyable post, Brian. Bainbridge is definitely one of the old guard areas. It's amazing what people will pay for that Zip code!

A great read Brian. I'm in awe at your knowledge of so many markets.

Naples - My daughter has always loved a little cottage (about 1,000 sf) in Downtown Naples. When she grew up she wanted to live in it. I think it last transferred for 1.4M.

Great Job Brian! I would personally steer clear of the condotels if you are looking for a big fat return really soon. Thanks for the disclaimer! Your estimates on how long it may take to turn it around seem quite accurate. We have some major incoming transportation issues and that is the reason why hotel owners are making such generous offers :giggle: to allow people to earn a piece of Vegas.

I could blog on this a lil' later :)

THANK YOU! I have been saying this about Naples/Marco Island for months! I am going to add this to my printed materials for buyers..

Great post Brian. You know I have never been to NY. Just seems way to crowded for me. Hey, where's Poinciana, Fl on your list?

Keith:

Here's the disclaimer I should have put up: While I have visited all of these cities, I haven't visited them all in the past five years. Much of this information is macreconomic theory and not market specific. This is my opinion, based on macroeconomic data compiled by industry specific groups and opinions given me by local real estate professionals.

Investing in a property in a city in this group because "Brady said so" would be naive. This is absolutely my opinion based on the volumes of articles I've read and the many conversaions I've had with other economics geeks.

So what does that mean? Colleen, Renee, Chris, and Rich? Will your market be the one I screwed up about? Let's hope not! Could Poincana become the next "destination resort town"? If it does, I promise I'll be one of the first to find out; I have "on-the-ground" intel there...right BB?

I think that it is going to be very negative cash flow and ROI for the condotel investors for so long. Hotels connected to casinos can lower their nightly rates substantially and hedge on casino, shop, restaurant volume to make up cash flow. I would never recommend financing one of these units but a cash only purchase. During a slow month a casino-hotel could lower nightly rates to $30-40 bucks a night and after they take their 50% this could barely cover association dues.

You prompted me to blog this am about this!

Please comment on financing if can structure these kind of deals :)

Please put that post my economics group, Renee.

This is the exact information I needed for Vegas. What I should have said was that a "condo" on the Strip is perfect to own as opposed to a condotel.

The point I was trying to make was that Vegas luxury condos on the Strip will never be "an affordability risk" as they will be in high demand from the rich and famous for years to come.

Renee has corrected my "very grave miscalculation". I stand by my "call" that the Strip is the right place to be but will amend the "property type"

Great post Brian. I'm looking forward to a very busy January.

Last night I had dinner with a client that moved to Miami last year, bought a great condo in SOBE (that they are keeping) but got relocated back to NYC. The weather was really nice so we ate outside on the upper west side. He kept saying the people are better looking in Miami. They are all beautiful.

What about The Hamptons? Suffolk county east end of Long Island

Mitchell:

I really considered the Hamptons but I've been reading how they are much more prone to the Wall Street swings than Manhattan. The fact that so many of those homes are second homes leads me to belive that they are getting hammered to the tune of 20% now, and will probably skyrocket 35% in the next two years if the Wall Streeet bonus boom persists.

If there is a particular town (Montauk?) that you now is impervious to wild swings, I'd appreciate your pointing it out. I'll do the research and comment.

As a side not, I have no doubt that you read "Manhattan is the epicenter of the world" One of my favorite lines from a New Yorker was from a bartender at McSorleys. He said "Hey! Face it. When you leave Manhattan...you're campin' out"

Brady, I'll take Newport. About 10 years ago I saw shack and I do mean a shake on the beach front for $1 million and it had just a few feet around the perimeter for land. But oh what a beautiful area. "If wishes were horses than beggars would ride."

Great for CA!

Brian,

I'm impressed at your knowledge of so many markets.

Great take on the market; I did appreciate the list you provided on The Old Guards.

Although I am about 90 miles outside of NYC there is a town or two trying to develop the feel of say Greenwich CT.

Great read. I would add Potomac, Maryland. Old money, new money, foreigh money. Lots of oil money, banking money, entertainers money, investor bankers money (wall street money), SEO money, the monied politicians that don't live in Northern Virginia.

The zip code is worth from $25,000 to $100,000 depending on location.

Thanks, Lenn. I knew there was one or two in MontCo, MD but didn't have time to research that area. Is that where Congerssional CC is? I thought that area was Potomac Falls.MD

I'll take Manhattan anyday; and second choice would be Alexandria. Potomac isn't right on the water (sorry Lenn!). Now sometime in my life I might be able to afford Alexandria too - Manhattan? Only vicariously through Mitchell lol. Alexandria has everything you could possibly want. The water, the close proximity to DC jobs, the Metro, gorgeous housing, food, a great music venue called The Birchmere which everyone should enjoy once in their life, raw oysters, crabs (oh yeah, I already said food). I think you did a great job on your list. Oh Brian, Alexandria also has great local shopping :-)

Wonderful post Brian. I agree with you on most! Is the activeRain team going to be buying in South Beach in ten years?....

Brain

Manhattan is the epicenter of the world" I love it. It has more credibility coming from you.

You could be right about the Hamptons and Wall Street. I don't know the market out there that well. East Hampton has an airport and the last few years it's filled with private leer jets coming and going many from California like Steven Speilberg. It's not just rich New Yorkers any more. It's called the prettiest town in North America.

Carole, Potomac is on the water The Potomac River. It is really nice. I have a cousin in Potomac. I like Alexandria also. I went to school in DC years ago. I had a professor in Old Town. He invited his students to his house after a few drinks he gave us the questions to our final. As far as Manhattan I can find you a needle in a haystack.

LOL Hi Mitchell; I knew someone was going to say Potomac was on the water. I lived in the DC area for 19 years. It's on the water, but most of Potomac housing is not waterfront. You are still 'car bound.' I think? Besides, Alexandria is more of a real city than Potomac. (Don't let my two Potomac friends read this lol)

Cool story about your professor. A drink and a final question? I would be able to afford the hole in the needle.

You're not a car person Carole? Manhattan is for you.

Professor Lawrence Laurent. He wrote on the black board the first day of class "Neither a Scrooge or a Patsy Be". I met him through business years later and we had a great business relationship because I was one of his students.

Read my most recent blog about rainmaking around the world in real estate. You'll understand the method to my madness by publishing this blog.

I had three of my buddies on the Street read this blog today and they actually called me, the avowed expert, to ask if they should buy in Midtown ;I haven't been to Manhattan in 7 years. Mitchell, is web 2.0 powerful, or what?

Brian,

2.0 is awesome

I got a call from the NY Post yesterday they read my blog and I might be in Sunday's paper. Midtown on the west side is hot "Hells Kitchen"

Whodathunkit? Makes sense, though. The Enterprise is right there, too.

Mitchell, ( HI Brian lol) when you say The NY Post read your blog, which blog are you talking about? AR or an outside blog? If you don't mind me asking.

Carole, Activerain about wall street bonuses, he asked me about the market if I think prices will go up what kind of apartments wall street types buy, if I have buyers from wall street. If I've sold trophy apartments. I was showing an apartment he called my cell.

That is truly amazing and I'm happy for you. I know you had Mr. Craigslist (yes?) commenting on your blog? I forgot to ask which blog it was. That is awesome.

DEC

2006

Carole, (Hope you don't mind the backlink Brian)

No Brokers Fee or bait and Switch

Brian won't mind he's one of the good guys, Mitchell! Thanks, I knew I had read this post! I'm smiling again! And actually, the reason I asked you about where the POST had found you (which blog) is my curiosity about how we get found out on AR

You and Brian give me hope! I'm going to do my blogging calendar (suggested in Realty Blogging) to theme my posts better. You guys are both very good at that. I'm still all over the map. Like my brain. : -)

Are you two staying up all night too? LOL I have water in my basement. SO not much sleeping going on here!

No prob. Mitch. I like backlinks; it makes for a more interesting comment blog. I'm up at night but it's 11 here

Excellent content. I'm actually glad that I'm not near one of the mentioned areas. I like affordable housing.

Good point, Chris. In many ways it is a high stakes poker game and they are tough markets to own if you are leveraged...one hiccup and your sunk.

I have decided after much scientific research that Hawaii is the absolute best market.

When the work day ends I am sitting in Hawaii. The is a good enough reason. Aloha to all who have to shovel snow to day. I am going to take a dip in the warm ocean.

Randy: I don't know too much about Hawaii. I'd appreciate your best pick for a market on the islands that is resilient.

DEC

2006

Nice blog on the great markets. I do have one comment on the Las Vegas Strip. I agree that you need to be in long term with the current Vegas market. I know several LO's locally that have helped with a couple condo projects on the strip and they are telling me that business is slow. But slow is relative if your talking 2020 as a date to hold the property. It's going to keep growing in Vegas, so if your a long term investor the water is still HOT!!!

DEC

2006

Great post lot's of info na dthe hyper links keep yopu involved in the reading and the break away. Nice real nice. Branson has spung up and is well developed. I have been here over thirty years and have loved every minute of it. I do hate to see the huge highrise buildings come I think we have a unique skyline and that just takes it away. Who am I to stand in the way of progress.

FEB

2007

Excellent read. Congrats on being picked up by a major paper. I have 18 years in the Branson vicinity. It's growth continues to surprise, but due to that growth, the overflow is coming into my nearby market on Table Rock Lake - Shell Knob.

Ozarks Joan

FEB

2007

Hi Brian,

Just wondering your thoughts on Bend, Oregon. Seems like we are generating alot ot interest here. It certainly is a beautiful place to call home. I too am in awe of your knowledge of the various cities...how wonderful to have been able to enjoy so many different places.

FEB

2007

Brian-I missed this.. but it does explain our market in Manhattan Beach.. we are close to downtown Los Angeles and the west side..We retain the small community flavor with excellent schools and have a terrific beach location..

Kelli: I don't know anything about Bend other than what I read. What I read is excellent.

Kaye: The whole MB, HB, RB. RPV area obviously fits the "model" I discuss. If I lived in LA, I'd live there.

Brian: If you live in LA these are the cities. This is an interesting concept that makes a great deal of sense. I think I feel a blog coming on...

JUL

2007

Brian,

Not only is your knowledge impressve but so is your vision.

I'm in the process of writing a book on a "Boomer's Guide to Retirement - Retire in 10 Years Even If You Don't Have a Dime Now!" and one of the chapters is entitled "The Five Resort Plan." The premise is that you buy homes in fashionable resort areas and put them on the weekly rental market. By the time 10 years have gone by, you should have great equity positions in each of the properties plus really good gash flow.

Many of my target areas are on your list, starting with Palm Springs.

I'm enjoying reading your posts.

Bill Roberts

JUL

2007

Thank you very much for sharing, I think you forgot Hawaii...while many places have seen dropping prices, we just got the median for June and it was a Record High...I don't know anywhere else that can say they just had a record high last month!

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