DanLog the ramblings of Daniel Pettit

I hung around after Life Group tonight for some Rock Band. It was the first time I’ve seen it in action. I must say I’m pretty impressed with how far technology has come since the pong of my childhood. I was thinking the other day that in the long run it might be more effective and cheaper to airdrop Wiis to the Middle East. Once they get hooked on bowling they won’t have time or care about jihad. This is an updated idea of mine I had quite a few years ago when the GameBoy had just come out. I figured then an airdrop of these would convert Iranian kids from the brainwashing of the Ayatollahs and turn them into “peaceful, decadent westerners”.

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So yesterday Julie mentioned how a man at the Apt Association had recently bought several houses in OC for $100k, this got me thinking that I should see if there is anything deal good enough for me to get into investment wise. Well did I find a deal! This one particular community in North Santa Ana on the border of Tustin. Very nice “townhouse” type condos. 2 bedroom 2 bath in the mid $50′s yes 50′s I didn’t forget a zero. I see that the association dues while quite higher than I pay, they’re not completely ridiculous. The satellite photo of the neighborhood looks good. There are several homes for sale in the community at bargain basement prices. The ones I’m looking at are either short sales or bank owned. So I wonder what is wrong here? I mean I could literally buy one of these 2 bedrooms on my Costco Amex card, okay I’d have to use both of them. Even at 13% and a ten year payback term, I could finance 100% and rent it out and be in the black by $100-$200 a month. So why hasn’t someone else bought all these up?

I mention this to Julie and she says she’d driveby today on her errands. She called me with the “catch”. The land is leased. The original 30 year lease is up and will be reset to current market value. They have been paying around $40 a month, well the new rate is going to be about $2000 a month. Okay then there is the deal breaker. Even if the condos were free you couldn’t charge enough rent to even cover the land lease. The whole thing is in litigation right now and I’m sure the final lease will not be that high or some offer buy the land might be offered. So there still might be an opportunity here for an investor with steel nerves and deep pockets to nail down an opportunity.

For me I will whistle on by this one. I have found many decent 1 and 2 bedrooms in the $90k – $120k range around South Coast Metro. I think I just might pick up one provided I can get traditional financing ( I wonder if Chase will offer offer me another 2.99% until paid off deal and add a zero to my credit limit?) At these price levels you can get in and be cash flow positive with little or no money down. Something unheard of in the OC market for years.

Another awesome Third Wednesday. I’m really falling behind on me blog’n. Maybe a rainy day or two will help me catch up.

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Justin suggested I take a picture of me eating my cake, so here it is. Conicidentally I ran into Justin today at Spag, he was looking for part-time job as he is between “real” jobs.

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It was quite yummy BTW and I only burned off part of my mustache before I remembered I needed to blow those little torches out.

Driving home in the wee hours of the morning from Steve and James’s. The foggiest I can remember being out in, in a decade or two.