House flipping

Here is a little bit of information for the people out there that may still be interested in flipping houses. You know how you see those shows on HGTV or TLC or whatever and people buy a real shithole, thrown some new flooring down and some paint up on the walls and sell for like a $30,000 profit in a month... well those days would appear to be gone for the most part. The housing market would appear to have finally corrected itself a bit. Earning 50% equity in less than a year is a thing of the past. At least until the government lowers prime interest rate to 2% again.... (hint: it probably will never happen again) I'm not saying there isn't money to be made in real estate... because there is quite a bit, but you will see people have to do it the old fashioned way... long term investments, probably have to rent the properties out for a while to cover your mortgage payments and sell down the road for a profit at the typical 5-10% value gain per year.. you will of course have to make constant improvements and upgrades over the years in order to move that value up and improve your equity. It is doubtful you will ever see people becoming millionaires over night in real estate again. It was just a lucky circumstance for a lot of people, and the quick increases in value drove more and more people to buy like crazy... increasing the values even more. It is the same as the stock market... eventually it gets to the point where nobody can really afford to make that investment anymore and the market is forced to correct... the problem is in real estate, you can't create stock splits to lower the prices to create more trading... someone has to lose their shirt for that to happen with real estate.

Some of you may already know that I am going for a job interview in southern california at the end of this week. There is almost no way I will take this job. I told them they would basically have to double my pay to get me to come... the reason being that the real estate market is about 3X what it is here. That is absurd... There is no way a 1000 Sq. ft. house should ever be over 300K. So that right away is reason for the housing market to HAVE to correct.. why would a company set up shop in California?? you have to pay more for your office space for one.. you are forced to pay your employees more (or else they all have rent apartments even when making upwards of 50K a year). So why the hell would you start a company out there.. You will see this negatively affect that area. This is why you see so many places opening up in the southeast, like Raleigh... Companies are getting huge tax breaks to open up shop here, their costs are down by doing it anyway because real estate and cost of living are right at the USA average and it's not a total shithole like Wisconsin or Nebraska so you can actually attract people to come work for you.