There’s always something to howl about.

Re-Entering the Real World of Real Estate Brokerage

As many of you know, I stopped doin’ business in my local market, San Diego, at the end of 2003. Since then I’ve done two transactions here, both as listing agent — both gettin’ the sellers Outa Dodge, so to speak. I haven’t bothered to market here cuz, well cuz I thought the prices were gonna keep falling, which they did, big time. Since I avoid short sales and REO’s like the plague, that pretty much ensured I’d not be doin’ any San Diego business. How dumb is it to buy income property in San Diego even now? You can see an example — where I present my answer to those whose only reason for holding on to the crappola they call income property there, is “I gotta be able to drive by my investment properties”. For the record, that example uses the lowest priced duplex in the neighborhood, and I used high projected rents.

My response to local real estate investors when they’ve called or emailed objecting to my stance, is to ask them, “Well now, how’s that whole ‘drivin’ by’ thing been workin’ our for ya lately?” The ongoing market correction, and there’s more to come IMHO, has reduced well located duplexes that sold in late 2005 in the neighborhood of $550-600,000 to hoping to find a buyer while now asking $300-400,000.

And their numbers still suck like a turbo-charged Dyson.

In spite of these empirical facts of life, I’m makin’ my official return to the San Diego investment market next week. Office is set up, except for the internet connection which will go hot by Wednesday. Yet it didn’t feel real ’till I picked up my new cards and letterhead this afternoon. Haven’t had either for many years. There’s literally been no need. Everything I’ve done since 2004 has been out of California, and everything sans referrals since July of 2006 has come from my 2.0 efforts.

It’s a good thing, cuz I had no other choice, unless it was to return to selling local homes to owner users, something I’ve happily abstained from doing since Carter’s second year in office. Man, just writing that puts a smile on my face.

Most have been surprised when I’ve told them my income should increase manifold almost immediately. This is especially true when they learn I will refuse to represent buyers in the acquisition of SD investment property — as in, get somebody else, I won’t be a party to it. Still, my income should rise by somewhere in the neighborhood of 5-10 times.

The reason is simple, in that pretty much all my local clients will be selling for the expressed purpose of movin’ their equities out of California. This means I’m back in the saddle again doin’ normal type business. See, when real estate investors make a move to improve their status quo, it almost always means they’re selling and buying — and buying more than they sold — 2-5 times as much. I’ve been shut out of this by San Diego’s horrific numbers. Since those numbers are now merely shamefully inferior, it’s likely local agents will bring their buyers to the table. There are more than enough agents/brokers and local investors who think I’m all wet about investing there. That works — as those buyers won’t be callin’ me when reality hits the fan.

The best part comes when the smoke clears on these transactions — the clients will be immensely better off. More cash flow, more tax shelter, and the ability to increase that superior cash flow 2-6 times in a surprisingly short time span. That doesn’t even account for the relatively rapid increase in their equity to value ratio. For me it’s like introducing filet mignon to someone who thinks a really top notch cheeseburger is the best they could hope for.

It’s what makes my work fun — significantly improving someone’s retirement, and/or movin’ up their retirement date. You can’t put a price on that feeling.

If you’re an agent/broker doin’ business in San Diego on the home sellin’ side, gimme a holler. I’ll show ya how to get listings you never knew were on your menu. No kiddin’.

So I’m all giddy with anticipation, not to mention I’ll now be able to resurrect my ‘local agent’ card on Fridays at HappyHour. Just don’t tell them how I feel about the local investment market, OK? They get a little touchy for some reason.