All, Real Estate

The Hot Market

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Part 1

You have probably heard that the real estate market is hot. I set up my first showing for buyers at 1648 Gardenstone Drive in Worthington. It went on the market Monday, we set up the showing Tuesday, we received notification Wednesday before the showing that there were 60 showings scheduled for Thursday, so be respectful to the sellers’ home. Sure enough, it was practically a revolving door of buyer groups at the house.

The home is listed for $199,900. It is certainly a difficult market for buyers, but there is a reason for that. Interest rates are still low and the economy is good.

“It is always a good time to buy a house that you want to live in.”

Part 2

We looked at a house today, Tuesday, that went on the market yesterday, Monday. I arrived at the house, checked my e-mail while waiting for my buyers to arrive and I had a new e-mail saying the house had already gone into contract. Disappointing. We weren’t alone either. There was another group arriving also who didn’t know yet that the house was in contract.

Part 3

A house went on the market Thursday before Easter for $225K. I looked at it with buyers Saturday. They liked it so we put in an offer over asking price on Sunday, Easter Day. They had 9 total offers and accepted one at around $237K with the buyer willing to pay cash over appraisal if necessary.

All, Real Estate, Ventures Quarterly

Real Estate Office

Next week, renovations will be complete on apartment A3 of 695 Riverview Drive. I will live there from 1 May until I find a great deal on a house. Until then, it will serve as an office from which I plan to find this great deal on a house.

I am seeking people who want to work out of this office doing real estate in the listed fields. The fields do not compete with each other. Rather, each one strengthens the others. This can be part-time or full-time and you will use the skills and experience you already have to succeed.

Payment will be negotiated on a deal-by-deal basis, beneficial to all parties. There are industry standards from which to start negotiations.

I provide the place to work and gather.

1. Choose the Right Market Location

Right now, Columbus is the market that I know. Therefore it is the right market for me.

2. Wholesaling

We need sources of good deals on properties.

A real estate agent cannot ethically or legally broker a deal with a large profit without work like with typical wholesaling. However, I can seek a good deal on a property to live in, which is what I intend to do to start out.

3. Real Estate Agent

I am an agent now with Signature Real Estate. That doesn’t stop others from working in this office.

4. Retailing

This includes renovating and selling great deals. (flipping)

5. Landlording

We can’t legally manage properties for pay without a broker, but you can get support in managing your own.

6. Lease-Option, Rent-to-Own

One of the more creative segments. It has its place. (Linden?)

7. Be the Bank, Invest

All deals need funding, and the guy with the money deserves to be paid. Non-performing loans coming soon.

Ready
to
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All, Real Estate

Olentangy Schools Re-Districting

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At the link there is a pdf to the map of the new 2018-2019 boundaries as well as the zones that were moved.

http://www.olentangy.k12.oh.us/domain/50

Southern Delaware County has been growing rapidly for many years. Olentangy High School was opened in 1953, Liberty in 2003, and Orange in 2008. Olentangy Berlin, the fourth high school, is expected to be completed in the summer of 2018 and open for the 2018-2019 school year.

There has been much talk about the re-districting that will take place. That decision was finalized this March 2017 and the results directly from the Olentangy Local School District are available at the link above. It includes information about the elementary schools, middle schools and high schools.

All, English Lessons

English Lesson 4

Quadcopters and Sia, Advanced Difficulty

This is a fun video. Even better, you can turn on subtitles and see what he is saying. Even better, you can print the transcript and read along what he is saying!

 

TED Talks are a great source of English language.

This is a popular song with good lyrics! There is one error in the video. She says “Come on. Come on.” She does not say, “Come one. Come One.” “Come one” doesn’t make sense.

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Nate’s Numbers Hub January 2017

Markets

$2,269 = S&P 500 close 10 Jan 2017 (Yahoo Finance)

28.09 = S&P 500 P/E Ratio on 10 Jan 2017 based on previous 10 years of earnings, AKA “Shiller Ratio,” “CAPE Ratio,” or “PE 10.” (www.multpl.com)

$29.8 trillion = total US market capitalization = $20.2 trillion NYSE + $9.6 trillion NASDAQ

$18.9 trillion = US annual GNP estimate (www.BEA.gov, GDP and the National Income and Product Account (NIPA) Historical Tables, Table 1.7.5)

131.2% = “Buffett Indicator” current as of 10 Jan 2017. This number is a variation* on [Total Market Capitalization] / GNP**.

(The calculation is explained here. Numerator obtained from Federal Reserve Bank of St. Louis, current value obtained by extrapolating with the Wilshire 5000 Index. The denominator is obtained from the BEA’s GNP from above. Calculations and chart in this Excel spreadsheet).

*Instead of using actual market cap value, I used “Nonfinancial corporate business; corporate equities; liability, Level” from the Federal Reserve Bank of St. Louis because the data is available since 1945. That number is only reported quarterly, so the Wilshire 5000 index is used to extrapolate to find the current value.

**The GDP is used by some reports instead of GNP, but Buffett uses the GNP. GDP and GNP are very similar, within about 1% of each other, and don’t fluctuate like total market cap does.

I have to pick an economist. My pick is John P. Hussman. He posts straightforward charts showing strong correlation between current indicators and future results. He uses the S&P 500 to measure performance and he has consistently posted weekly since 2003. All of his posts are available for quick reference: Hussman Funds Weekly Market Comment.

241 = current Consumer Price Index. This number is adjusted so that it averages 100 from 1982-1984. For the first year this number was calculated, 1913, the value was 9.9 (BLS)

1/2-3/4 = target range for the federal funds rate. (www.federalreserve.gov, 14 Dec 2016 FOMC Statement, and bankrate.com)

“Yield Curve” at stockcharts.com

6.93 = Chinese Yuan Renminbi for 1 US dollar (x-rates.com)

My Market Tools, Long-Term to Specific

  1. Buffett Indicator from above
  2. My economist pick: John P. Hussman, referenced above.
  3. Investor’s Business Daily Big Picture
  4. CANSLIM checklist for picking individual stocks

Energy

All energy data here is in petajoules = 1 quadrillion joules = “1-with-fifteen-zeros” joules, which can quickly be converted to other units of energy for comparison:

1 petajoule =

  • 163,456 barrels of oil, energy from (BOE)
  • 277.8 gigawatt-hours = 277,800,000 kilowatt-hours
  • 0.02388 million tonnes of oil equivalents (MTOE)
  • 0.0009478 quadrillion British Thermal Units (BTU)
  • 0.0009202 trillion cubic feet of natural gas, energy from (based on 1,030 BTU / cubic foot, IEA website)

395,000 petajoules = 2014 global energy consumption estimate (International Energy Agency, Key World Statistics 2016)

102,704 petajoules = 2015 US energy consumption estimate, 26.0% of global total (US Energy Information Administration Annual Energy Review, Table 1.1)

See also the US energy flow graph, Section 1.0, for a visualization of energy use.

9,911,000 petajoules = energy contained in the 1,620 billion barrels of proved world petroleum reserves (US Energy Information Administration), using the above conversion as an estimate of the energy equivalent.

7,153,000 petajoules = energy contained in the 6,582 trillion cubic feet of proved world natural gas reserves (US Energy Information Administration). This is probably a very rough estimate because of variance in the energy contained in different natural gas.

$50.82 / barrel = current price of WTI crude oil (US EIA) = $8,307,000 / petajoule of energy

$3.41 / million BTU = Henry Hub spot price of energy from natural gas (US EIA) = $3,232,000 / petajoule from natural gas

8.307 / 3.232 = 2.6: oil energy currently costs 3.4 times as much as natural gas energy.

Commodities

$1,188 = price of one ounce of gold (goldprice.org)

$16.74 = price of one ounce of silver (goldprice.org)

1,188 / 16.74 = 71, current gold-silver ratio, historical range of 14 – 100 since 1975 (goldprice.org charts)

Jobs

324 million = total US population (US Census Bureau Population Clock)

251 million = US civilian noninstitutional population

59.0% = employment-population ratio, which is the percentage of civilian noninstitutional population who are employed. Total employed is 148 million people. This is 45.7% of the total population.

5.3% = “unemployment rate” the most-often-reported percentage that excludes people who are not seeking employment, whether receiving unemployment benefits, welfare, or otherwise.

Click here for historical employment numbers. For more detail in easy-to-read charts, see “Charting the Labor Market.” The data is also broken down regionally and by state.

(US Department of Labor, Bureau of Labor Statistics Current Population Survey, November 2015)

All

Movie Review: The Big Short

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I just watched the movie The Big Short. It portrays itself as exposing the truth. It exposes the truth about the actions at the very top of the “housing crisis” problem, but it fails to really drive home the scope of the problem. Yes, people at the banks were apathetic, irresponsible, and crooked, and their actions ultimately resulted in taxpayers footing the bill. However, it portrays the other participants in the problem as victims, and I believe this is an injustice.

One statement in the movie in particular clearly emphasizes my point and I want to bring it up because it is so pervasive in our language. They quote a statistic about people being evicted from homes they lived in that banks bought for them by saying, “X million people lost their homes.” No. Those X million people never owned homes in the first place. The first people to be evicted in such a situation are those who took low-money-down, teaser-rate mortgages. That means they never paid a dime for “their” home. That’s the nature of such loans. The bank took a huge chance trying to give them something they never earned in the first place. They were irresponsible and undisciplined enough to take it and not pay. Maybe you could say they were naive enough to take it. Maybe even the loan sharks practically forced it on them. Regardless, they were part of the problem and nothing was taken from them that they actually earned. X million other people weren’t greedy enough to fall for such obvious gimmick loans, remained living right where they were, and happily waited out the crisis watching it on network TV over a new digital antenna.

Is the problem behind us? No. I don’t know what the next “crisis” is, but I know how to survive it. Avoid the following irresponsible, undisciplined decisions: cable TV (yes, that’s right, you will not know what to do with your spare time, see suggestions below), car loans (yes, save up then drive a used car), smoking pot (it makes you dumb and lazy I’ve seen it personally), credit card debt (pay it off by all means necessary especially by quitting the other items on this list), excessive alcohol (quit entirely if you have to).

I’m going to add to the list: ridiculously expensive but worthless college degrees. Students are the latest fad hapless debtor voters  for the government to victimize and force taxpayers to bail out. Oh, but certainly education is important! Getting drunk and high for 4 years and talking about your feelings is not an education, even if you pay $35K per year to do it.

Do: read. Information is out there.

Do: exercise. Bad health is expensive.

Of note, they show a guy with a family in the movie who is evicted even though he paid his rent because the owner defaulted. That is truly unfortunate. However, I personally work hard to ensure that those who pay their rent, as is reflected by their credit score, have a safe and stable place to live and pay their rent on time!

All, Ventures Quarterly

Ventures Update January 2017

Columbus, Ohio Occupation

It is time for me to get a job. My credit card monthly balance is now roughly equal to my checking account balance. I need income.

Uber Driver

I have driven for Uber about 5 different occasions now over the last 2 weeks here in Columbus. The bad news is, you can be online for hours at a time sometimes without getting a single trip. The good news is, it is great fun, you talk to a lot of different people, during peak times there are plenty of trips to be had, and you can know exactly when those peak times are, they’re obvious. The peak times I’ve identified are 1. weekend nights when the bars close, 2. after sporting events like after Ohio State football and Blue Jackets hockey games.

I have averaged only about $10/hour so far, but a lot of the online hours that Uber counts include sitting at my house waiting and not getting a call. I made $75 in the 3 hours after midnight on New Year’s Day. Last night, I made $20 in the 1 hour following the Columbus Blue Jackets hockey game by making 4 Uber trips from the Arena District.

I would now not say, “I drive for Uber,” but rather, “I use the Uber app to get paid to drive people home from specific local events.”

Handyman

I helped my uncle build his shed!

 

Real Estate Agent

I signed up for the real estate course at Hondros Business College. I am scheduled to finish the course on 18 February.

I also joined the Central Ohio Real Estate Entrepreneurs, COREE, yesterday. It’s a really great group of about 320 members.

Business Consultant

I am seeking to help lawyers implement accounting software and take a directed look at the business side of their practice in order to more effectively self-manage and consciously make business decisions.

695 Riverview Drive

Still running smoothly and fully occupied. We are saving money for a remodel in a few years depending on the market and situation. In October, I replaced the steps.

Mike was the first tenant on the steps. He’s giving them a quick inspection.

Kineomen

Kineomen is a holding company based in North Carolina. The president of Kineomen is also the CFO of Simple Kneads, the bread company . Kineomen holds a stake in Simple Kneads and owns 707 Brookgreen Terrace in Graham, North Carolina.

707 Brookgreen Terrace, Graham, NC

I lived at “The Terrace” for about 6 weeks in October and November doing upgrade work. It was like camping indoors. I really enjoyed it and I am now looking to do the same thing in Columbus, Ohio. Removing the vines from the side was one day out of many projects.

“The Terrace”

Simple Kneads Gluten-Free Bread

Continuing to build the brand and expand sales. Exciting advancements each month.

Vino de Coco

I still plan on going there in person as soon as possible.

The Stock Market

I’m still out of the stock market.

All

America’s Energy Infrastructure

Dear Mr. Trump,

I was a US Marine from 2007 to 2015. I flew CH-53E helicopters in the Marine Corps and completed two tours to Afghanistan. I completed my service as a Captain. I graduated from Ohio State with an electrical engineering degree in 2006. I am a civilian now, and I am happy that I will be starting a business in Columbus, Ohio in your de-regulated America.

I am a life-time Republican and I still find myself cheering for Republicans like I cheer for Cleveland sports teams. I just do. It’s in my blood. I especially relished your victory because of the brash exposure of phony politicians, and insidious media bias. Unlike a cheering fan, however, I no longer align with Republicans on every issue.

I read your two-page 100-day action plan as well as The Art of the Deal. I agree with almost everything on the action plan and I am encouraged that it will be executed by the competent team that you are assembling.

The one item that sticks out like a sore thumb, however, is your energy policy. Putting Americans to work producing $50 trillion worth of domestic energy from reserves like shale, oil, natural gas, and “clean” coal would be like spending millions of dollars to refurbish the brick façade of the Commodore Hotel. It is uninspiring, unimaginitive, and small-thinking. This stated initiative is especially disappointing because of the contrast with what could be. A state-of-the-art energy infrastructure that favors renewable sources and efficiency is the modern-day equivalent of having the world’s tallest building, which as I’m sure you are painfully aware, we no longer possess.

We could build the world’s tallest building, but we don’t because it is not worth doing. Creating an energy infrastructure in America that wins in measures like efficiency, per-capita consumption, and reduced reliance on limited natural resources, especially foreign sources, is worth doing. Energy acquisition and production is not just an environmental issue. It is an important economic, national defense, and national security issue. We spend trillions, and commit forces around the world to secure trade routes to attain energy from countries with whom we would otherwise rather not deal at all. Energy is an issue that every country in the world faces, and it is not going away.

This would require challenging the very American voters who elected you as president. Some of the policies would be controversial and potentially unpopular. However, to your credit in my opinion, this has never stopped you. Leading the world with the truly best energy infrastructure would require cultural buy-in at the most basic level. Such a cultural shift would have to be led by an independent initiator with a grass-roots following and credibility on the issue. Politicians quoting scientists telling us that melting ice and arguably-measurable increases in storm intensity will never assign the imporance that it deserves. The various other reasons to undertake these projects are more directly visible and more important anyway.

This would require innovation. I hardly have to say that America is great and always has been because of our ability to innovate. We are up to it if anybody is up to it.

This would be difficult. We fought a civil war to save the union and end the evils of slavery—difficult, but the right thing to do. We were the deciding factor in both world wars—difficult, but the right thing to do. President Kennedy challenged America in 1961 to reach the moon by the end of the decade—difficult, but we got there first, and on time. Opening the floodgates to easy energy would be predictable, boring, and easy. All three of those things are un-Trump and un-American.

We need new energy infrastructure projects, but we shouldn’t be dusting off the old brick façades from 1970. Our infrastructure is already big. It should be innovative, efficient, shiny, and new. It should win in every category and by every measure. It can and should be built by competent American private businesses with leaders like yourself, incentivized by natural market forces. We can. It is worth doing, and it is the right thing to do.

Nathan Ruffing

Produce. Persist. Own. Succeed. Fail. Care. Do. Learn. Win.