Our airport blvd property is under contract with three backup offers. Whew! That feels good. In a land of new ventures and old, it is good to be moving again on ye old box that bends. It's been too long, amigo.
We are starting to see signs of a thinning herd. What we mean by that is that for a while the local market in our neck of the woods was so hot that it was hard to find a deal. We are now seeing an upswing in auction properties and less movement in the local community. We are not sure if this is due to a seasonal slow down, early signs of a recessional slowing in the overall economy, or the fact that a lot of people play this game and some make money. For months (years?) we have been thinking, and possibly saying, whining, complaining, that the deals we're seeing were going for too much. Which is a nice way to say that we were or are too stupid to pay, for example, $115,000 on a property that would have an ARV of $145,000, and in need of approximately $15,000 to $20,000 in work. Ten grand in profit is great. However, banking on expenses staying within budget, failing to take into account insurance, taxes, city and utility expenses, and a realtor fee -if not marketing the property on one's own -seems extremely foolish and overly restrictive. Like 99.9% of all coach airline seats. These numbers might make sense for rentals, but even there, the value of the rehab (compared to the cost or dollars invested) may produce a marginal cap rate instead of an extraordinary one.
At any rate, we are now seeing more deals. However, we are being extremely judicious about what we jump into. And oh yeah. There is that project that never ends -Main Avenue. This is the project that never ends. Yes it goes on and on my friend. We were just people who started working it, not knowing what it was, and we keep working it forever just because... it is the project that never ends. This is the project that never ends...
Actually, Daylight may be around the corner. Now that we found out that our historical window sizes are not the normal off-the-rack sizes that are all custom sizes. "Hey? That was fun. And cheap, too." However, the silver lining in these clouds is that while this project has drug on and on and on and on and on and on and on and on, we have watched the very-bad-never-live-there-in-a-million-years-neighborhood catch up to the old Box Bend vision. There are now some $500,000 and $600,000 projects that have sold not far from us. So... to wrap up the Main briefing, it would have been more economically efficient for us to sell this project a year or more ago, but, we have witnessed a potentially 10% or greater increase in our potential price; from $390,000-$410,000 to the $430,000 -$460,000 estimated range. That is, if we can finish this pig before the summer is over. That's a big 'IF." We have also discussed renting it, and still are debating that move. If we do not need the cash, we may do so, but...
We want to build up our cash reserves. No matter if the recessional forces of all cycles are two years away, or four years away, as sure as Main is having trouble with Lift-Off, those economic currents of slowdown and forces will present themselves again. And when they do, everything will be on sale. Every thing. It will be a time of make or break. We are betting on make -meaning that the discounts in real estate, stock, and other assets will be considerable and fortunes will be made. Legacies will be created. The caveat is that one will need either the cash, or access to cash. Access to cash will be hard to obtain. Just our guess, but the flush and eager sources that are out there now will suddenly become miserly and detail oriented. Of course, building up the cash reserves is no easy feat either. For us, right now, today, the biggest fiscal events on our calendar are taxes (we have an extension) and a Box Bend family member attending college at a not-so-cheap school in a place we like to call, "The City." We also like to call it, "The Big Dirty Apple." Resources are burned at an incredible rate in The City. Good news is that they can also be produced at astonishing rates.
Anywho, it is time to fly. Time to lift off on Airport, use those funds for other things. Other obligations. Others. And time to wrap up Main. We have put new ground controls in place in order to help our contractor fly those friendly skies without incident... or bird strike. Enough with the weak metaphors. But, really... Time to fly.
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