Johns Creek Homes and Real Estate

[panda]

Atlanta appreciation between January 2016 - August 2016 remains at 5.6%. Only four MSA cities outperformed Atlanta in terms of appreciation in 2016 which include Seattle, Portland, Denver, and Dallas. Currently Atlanta is just 2.7% below its last peak in July 2007.

Notice that New York is the only city that is in the red in terms of appreciation from January 2016 - August 2016. The California cities are not doing too well either compared to the other major MSAs. San Francisco's 2016 appreciation is 1.6%, Los Angeles at 2.0%, and San Diego at 1.6%

The highest risk areas of a bubble include these MSAs
1. San Francisco (The largest bubble of them all)
2. Boston
3. Denver
4. New York City
5. Minneapolis
6. Los Angeles / Orange County
7. Miami
8. Washington D.C.

Medium Risk Cities
9. San Diego
10. Portland
11. Dallas
12 Seattle

Lower Risk Cities
13. Charlotte
14. Atlanta
15. Tampa
16. Chicago

Lowest Risk Cities
17. Detroit
18. Phoenix
19. Las Vegas
20. Cleveland

 

[panda]

Between 2012 - 2015, you can see that the appreciation between Los Angeles MSA and Atlanta MSA tracked very similar to one another. It is in 2016, the cities' appreciation data are starting to decouple.

 

[irvinehomeowner]

Who would of thought IHO would be considering Johns Creek?

Not to live at... obv.

But my money can live there if it's going to grow at a return rate better than 1%.

 

[hello]

Between 2012 - 2015, you can see that the appreciation between Los Angeles MSA and Atlanta MSA tracked very similar to one another. It is in 2016, the cities' appreciation data are starting to decouple.

So in the past 4 years your yields are as follows below:
S&P had 89% increase value, atlanta homes 54% increase in value and LA homes had 50% increase in value.
Even if you consider tax benefits to owning property, it seems investments in S&P is the winner...

 

[panda]

Well not necessarily as you have leverage, cash flow, amortization and tax benefits with LA and Atlanta real estate, but not with S&P. If we are just counting appreciation with 4 to 1 leverage, LA return would be 8% and Atlanta's return would be 22.4% vs 6.2% for S&P. My gut tells me that 6.2% return on the S&P 500 will be wiped out come December 31st, 2016.

Between 2012 - 2015, you can see that the appreciation between Los Angeles MSA and Atlanta MSA tracked very similar to one another. It is in 2016, the cities' appreciation data are starting to decouple.

So in the past 4 years your yields are as follows below:
S&P had 89% increase value, atlanta homes 54% increase in value and LA homes had 50% increase in value.
Even if you consider tax benefits to owning property, it seems investments in S&P is the winner...

 

[usctrojancpa]

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are. 

 

[panda]

Trojan,
S&P pays peanuts for dividends while with real estate you have cash flow. As a real estate professional you are allowed unlimited losses to offset your earned income. You cannot do that with losses with S&P. Don't get me wrong, there is a place for the stock market in one's portfolio but i like my stock market asset allocation around 20% of my networth. Businesses and real estate investments are controllable, but no one can control the stock market. Small businesses and real estate are my favorite asset classes for building wealth due to the tax advantages are the most favorable for these two asset classes.

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are. 

 

[hello]

Well not necessarily as you have leverage, cash flow, amortization and tax benefits with LA and Atlanta real estate, but not with S&P. If we are just counting appreciation with 4 to 1 leverage, LA return would be 8% and Atlanta's return would be 22.4% vs 6.2% for S&P. My gut tells me that 6.2% return on the S&P 500 will be wiped out come December 31st, 2016.

Between 2012 - 2015, you can see that the appreciation between Los Angeles MSA and Atlanta MSA tracked very similar to one another. It is in 2016, the cities' appreciation data are starting to decouple.

So in the past 4 years your yields are as follows below:
S&P had 89% increase value, atlanta homes 54% increase in value and LA homes had 50% increase in value.
Even if you consider tax benefits to owning property, it seems investments in S&P is the winner...

I was 100% sure you would say "what about leverage and amortization".  Correct me if I am wrong, but when you calculate leverage into this factor, do you re-calculate returns as you pay money into the investment?  Unlike stocks, when you buy real estate with leverage, you are continually paying into this investment (mortgage), thus your costs to return ratios should change with that.

I do agree, if its an investment property with cash flow, that is an obvious factor that should be considered.  It makes sense in Atlanta, but you are not cash flowing well or most likely at ALL in LA. 

 

[hello]

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are.

I was thinking the same thing... however the typical investors never seem to buy stocks on margin, whereas in real estate it is done nearly 100% of the time.

 

[hello]

Trojan,
S&P pays peanuts for dividends while with real estate you have cash flow. As a real estate professional you are allowed unlimited losses to offset your earned income. You cannot do that with losses with S&P. Don't get me wrong, there is a place for the stock market in one's portfolio but i like my stock market asset allocation around 20% of my networth. Businesses and real estate investments are controllable, but no one can control the stock market. Small businesses and real estate are my favorite asset classes for building wealth due to the tax advantages are the most favorable for these two asset classes.

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are. 

Unfortunately many of us are not real estate investors.  I also think people need to consider the carrying costs of real estate as an investment.  Unless a house cash flows, it could be a drain on appreciation.  Again, speaking moreso of LA/OC real estate.  No costs to holding onto a stock for a billion years. 

 

[usctrojancpa]

Trojan,
S&P pays peanuts for dividends while with real estate you have cash flow. As a real estate professional you are allowed unlimited losses to offset your earned income. You cannot do that with losses with S&P. Don't get me wrong, there is a place for the stock market in one's portfolio but i like my stock market asset allocation around 20% of my networth. Businesses and real estate investments are controllable, but no one can control the stock market. Small businesses and real estate are my favorite asset classes for building wealth due to the tax advantages are the most favorable for these two asset classes.

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are. 

It's best to diversify period.  One of the things that I make a good income on is trading VIX options.  As the saying goes, focus on what you know best.  These are also tax favorable in terms of 60% of the gains from buying/selling those VIX options are long-term capital gains even if the trade was only for one minute because they are cash settled options (see Section 1256 contracts).  I'm actually starting an LLC with a client (sort of a hedge fund) where we will both put in the same amount of capital and I obtain 60% of the gains because I'm the one that is actively trading.  If it goes well, I might think about opening a real hedge fund as I've been trading these options for 6+ years now and booking 20-100% gains every year.  That being said, it's not for the faint of heart and should only be for be at-risk capital.

 

[hello]

Trojan,
S&P pays peanuts for dividends while with real estate you have cash flow. As a real estate professional you are allowed unlimited losses to offset your earned income. You cannot do that with losses with S&P. Don't get me wrong, there is a place for the stock market in one's portfolio but i like my stock market asset allocation around 20% of my networth. Businesses and real estate investments are controllable, but no one can control the stock market. Small businesses and real estate are my favorite asset classes for building wealth due to the tax advantages are the most favorable for these two asset classes.

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are. 

It's best to diversify period.  One of the things that I make a good income on is trading VIX options.  As the saying goes, focus on what you know best.  These are also tax favorable in terms of 60% of the gains from buying/selling those VIX options are long-term capital gains even if the trade was only for one minute because they are cash settled options (see Section 1256 contracts).  I'm actually starting an LLC with a client (sort of a hedge fund) where we will both put in the same amount of capital and I obtain 60% of the gains because I'm the one that is actively trading.  If it goes well, I might think about opening a real hedge fund as I've been trading these options for 6+ years now and booking 20-100% gains every year.  That being said, it's not for the faint of heart and should only be for be at-risk capital.

My colleague is a big options trader also.  Does really well also.  Ive been told its not as complicated as most think it to be...

 

[Bullsback]

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are.

I was thinking the same thing... however the typical investors never seem to buy stocks on margin, whereas in real estate it is done nearly 100% of the time.

In real estate, if things hit the fan, you can walk away from the property and all they have recourse to is the actual phyical property (they can't come after other assets, even if you had millions elsewhere).  In a margin account, they have access to your other assets in terms of a make whole, so if you actually lost, you aren't as shielded in a downside scenario as you are with real estate.  That is a really really big deal.  That said, I've never traded on margin so maybe I'm missing a concept and you actually have similar "protection". 

 

[usctrojancpa]

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are.

I was thinking the same thing... however the typical investors never seem to buy stocks on margin, whereas in real estate it is done nearly 100% of the time.

In real estate, if things hit the fan, you can walk away from the property and all they have recourse to is the actual phyical property (they can't come after other assets, even if you had millions elsewhere).  In a margin account, they have access to your other assets in terms of a make whole, so if you actually lost, you aren't as shielded in a downside scenario as you are with real estate.  That is a really really big deal.  That said, I've never traded on margin so maybe I'm missing a concept and you actually have similar "protection". 

That's why using things like stop losses is important.  Another way of limiting exposure is to set up an LLC and trade under the LLC.  You just have to be smart about it and not take stupid risks. 

 

[usctrojancpa]

Trojan,
S&P pays peanuts for dividends while with real estate you have cash flow. As a real estate professional you are allowed unlimited losses to offset your earned income. You cannot do that with losses with S&P. Don't get me wrong, there is a place for the stock market in one's portfolio but i like my stock market asset allocation around 20% of my networth. Businesses and real estate investments are controllable, but no one can control the stock market. Small businesses and real estate are my favorite asset classes for building wealth due to the tax advantages are the most favorable for these two asset classes.

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are. 

It's best to diversify period.  One of the things that I make a good income on is trading VIX options.  As the saying goes, focus on what you know best.  These are also tax favorable in terms of 60% of the gains from buying/selling those VIX options are long-term capital gains even if the trade was only for one minute because they are cash settled options (see Section 1256 contracts).  I'm actually starting an LLC with a client (sort of a hedge fund) where we will both put in the same amount of capital and I obtain 60% of the gains because I'm the one that is actively trading.  If it goes well, I might think about opening a real hedge fund as I've been trading these options for 6+ years now and booking 20-100% gains every year.  That being said, it's not for the faint of heart and should only be for be at-risk capital.

My colleague is a big options trader also.  Does really well also.  Ive been told its not as complicated as most think it to be...

Yeah, I know a guy who has made millions trading options over the past 10 years.  It's not that hard if you do the homework and focus in on trading what you know best and disciplined. 

 

[AW]

Panda, you can also use leverage via a margin account....maybe not 4 to 1 but 2 to 1 and 3 to 1 at rates close to where mortgages are.

I was thinking the same thing... however the typical investors never seem to buy stocks on margin, whereas in real estate it is done nearly 100% of the time.

In real estate, if things hit the fan, you can walk away from the property and all they have recourse to is the actual phyical property (they can't come after other assets, even if you had millions elsewhere).  In a margin account, they have access to your other assets in terms of a make whole, so if you actually lost, you aren't as shielded in a downside scenario as you are with real estate.  That is a really really big deal.  That said, I've never traded on margin so maybe I'm missing a concept and you actually have similar "protection".

I was playing with fake money and simple options concept of hedging calls and puts on the same option, actually did ok.  So I guess that's the protection if you go that route. Many times the contract expires worthless plus the trade cost...

Need to pool in some play money and try it for realz... equity market will see heavy volatility every now and then

 

[panda]

 

[Dresden215]

I was in Atlanta last week and decided to visit Johns Creek. Saw the model home at Adair Manor. I was stunned when I looked out the upper story bedroom window and saw a wooden area and not a neighbor's window! I've been so conditioned in California to only see other homes when I look out the window. Johns Creek is a beautiful town and the home prices are shocking compared to Irvine.

http://www.ashtonwoods.com/atlanta/adair-manor/kendrick-adair-manor

 

[panda]

Dresden,
You should have hit me up while you were out here. I would have showed you a good time

Next time you are in town make sure you check out Fumi in Duluth.

Link:http://www.opentable.com/r/fumi-hibachi-and-sushi-bar-duluth

Panda

I was in Atlanta last week and decided to visit Johns Creek. Saw the model home at Adair Manor. I was stunned when I looked out the upper story bedroom window and saw a wooden area and not a neighbor's window! I've been so conditioned in California to only see other homes when I look out the window. Johns Creek is a beautiful town and the home prices are shocking compared to Irvine.

http://www.ashtonwoods.com/atlanta/adair-manor/kendrick-adair-manor

 

[socal78]

Panda, how are things down south? How are the twins doing? I wonder what grade they're in now.