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Tuesdays Tip #4

Stay the heck out of Sacramento, California. Wow.

I thought we were in bad shape here in Indianapolis when our foreclosure rates placed us #1 in the country, but even then we weren’t experiencing anything like that of what the poor home owners of Sacramento are suffering right now. Their home prices were severely inflated, like everywhere else in California, and now their values have dropped 4.3% from one year ago. That means at an average sales price of $362,660, Sacramento home owners lost about $16k of their equity in the past year.

So, here’s my idea: avoid investing money in an area where prices are inflated, values are decreasing and positive cash flow isn’t anywhere in sight.

Tuesday’s Tip: Avoid “sucky” markets.

Posted by Derek Guyer on 02/27/2007 06:15 AM

Comments (7)

tuesdays tip, indianapolis, investments, real estate, california, cash flow, equity, tip, short sales, sacramento real estate, sacramento

This post has been included in California Information

7 Comments on Tuesdays Tip #4

FEB

2007

I wasn't aware of what is happening in Sacramento--California really has some problems right now. But of course, that's nothing new, is it? The saying goes--"What goes up must go down."

Hey Dereck.. i read a similar piece on California and even a spot in Colordado (i think). it was late last night.

I like your tip. funny :)

Derek, it seems that your area of expertise is in Indianapolis. It's best to stick with your own area and let the CA folks discuss CA...just an opinion.

Gena, Diane and Nick, thanks for stopping by my blog. It's a shame to see what has happened and is happening out there. We've been through it here and people said some of the same things about Indianapolis as I am saying now about Sacramento. Gena, I'm sorry if you're offended by my joke/tip, but in reality my expertise has nothing to do with how bad it is. 1 in 5 homes is terrible and that doesn't make for good investments in an inflated market. I guess that's my opinion.

Derek, of course you are welcome to your opinion. I however, would never dream of expounding on a Real Estate market and area that I was not acquainted with and did not have first hand knowledge about.

FEB

2007

Gena, thanks again for commenting. I can appreciate your thoughts, but still disagree. The numbers are evidence of how serious the problem is and my expertise of a given market doesn't change that fact. It has fallen apart out there and in many other areas and the reports have made that obvious. My opinions or expounding on it won't change it. It is what it is.

MAR

2007

GREAT ADVICE

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