Opportunities in the wake of Harvey

FleeceJohnson's picture
Rank: Monkey | 64

Where will the dispossessed migrate to? What will this mean for real estate in the Houston area? Will surrounding markets, Austin, Dallas, NO gain? Opportunities to buy? Looking to start a general discussion.

EDIT: Sorry to anyone I offended; this was a poorly timed and worded question.

Region: 
United States - South

Comments (41)

Aug 28, 2017

bump

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Aug 28, 2017

The shitty timing of this question and your blase attitudes towards people going through some pretty rough shit aside, I think areas of Houston that avoided the worst of the flooding are much more likely to see growth than Austin or Dallas. Doubt you see any long term changes. Houston is the fourth largest city in the US with a strong economy; there won't be a Katrina-level exodus like you saw in New Orleans.

People are hurting there; try not to be a fucking asshole.

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Aug 28, 2017

What he said.

If misery loves company, what does success love?

Aug 28, 2017

When would be a good time to ask this question? Years down the line when capital is no longer needed? As callous as looking for opportunity in others misfortune is, attempting to make a dollar through investment in the rebuilding is far more beneficial to the people of Houston than feigning concern for people you have never met. The hurricane happened; I cant change that, but I am trying to help in my own way, regardless of how it may benefit me. Anyway, you can spend your time admonishing strangers and conjuring up crocodile tears, but it isnt helping anyone.

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Aug 28, 2017

A good time would be when the eye of a hurricane isn't over 6.6+ mm people. You trying to buy buildings in Houston is not an "investment in the rebuilding", and it has literally zero benefit to the people affected by the storm; an attempt to claim otherwise is pretty disingenuous. The way you phrased your question is makes you sound like a war profiteer. I get where your head is at, but asking a question like "how can I help these people" seems slightly more appropriate than "how can I make a buck off this hurricane". You can do what you like though; hope it works out.

As for me feigning concern... I have family there, dozens of friends, we own or manage 10+ properties there, and work with dozens of people there on a daily basis. This affects my family, friends, colleagues, and their families.

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Aug 30, 2017
Count_Chocula:

The shitty timing of this question and your blase attitudes towards people going through some pretty rough shit aside**, I think areas of Houston that avoided the worst of the flooding are much more likely to see growth than Austin or Dallas. Doubt you see any long term changes. Houston is the fourth largest city in the US with a strong economy**; there won't be a Katrina-level exodus like you saw in New Orleans.

People are hurting there; try not to be a fucking asshole.

Anything to back this up? Recent job growth in Houston was abysmal.

https://www.bisnow.com/houston/news/multifamily/ho...
*"One of the largest multifamily REITs in the U.S. is seeing rents drop to levels not seen since the last recession in Houston thanks to a double-whammy of lackluster job growth and a bunch of new apartments.

The Houston market -- where Camden owns and operates about 25 properties -- is expected to see historic property rent declines of up to 4% this year, said Camden president Keith Oden during a conference call with investment analysts this week. Giving Camden's various markets a letter grade, Oden ranked Houston a "D" as 10,000 new units continue to make the area a renters' market in light of lackluster new jobs. Still, there was a bright spot with incoming deliveries. "It does represent a 50% reduction from the 2016 deliveries," Oden said. Houston's performance is among the historic lows for the REIT over the past 24 years, with Oden adding that those same-store rent hits typically occurred during recessionary periods of 2003 and 2010.
*

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Aug 30, 2017

Can't argue with the supply story and anemic rent and job growth. Would I be buying deals there now, maybe in the rights pocket, but generally no. My point was that long term I see Houston as being fine as its economy continues to diversify, and I don't see the storm as having any impact on that. Still projected to be the third largest city in the country relatively soon, despite short term headwinds. Hope that makes sense.

Aug 28, 2017

"5 minutes after the Challenger blew up, he's on the phone shorting NASA stock!"

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Aug 29, 2017

Reminds me of the d-bags who shorted the market within minutes the planes flew into WTC. However, that was much worse.

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Aug 29, 2017

What about forum favorite, Bobby Axelrod?!?! While this is an un-savory aspect of finance, I am not convinced it's unethical.

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Aug 30, 2017
hiit:

What about forum favorite, Bobby Axelrod?!?! While this is an un-savory aspect of finance, I am not convinced it's unethical.

You realize that's a TV show, right?

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Aug 29, 2017

If I ground lease to McDonald's, am I an obesity profiteer? Or does that not count because it's on such a long time span

Aug 29, 2017

Just playing devil's advocate: people CHOOSE to eat at mcdonalds. nobody chooses to have a hurricane wipe out their home.

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Aug 29, 2017

Last I checked, folks have the choice where to live in the US, which includes areas that are prone to natural disasters and areas that aren't.

I'm not arguing that losing your home or lives of friends and family to a hurricane or any natural disaster for that matter isn't awful. My sympathies go out to the people who got caught up in this.

But if you're trying to draw a moral distinction between profiting off of others' short term misfortunes versus long term misfortunes, you'll have to do better than that.

How do you feel about tobacco stocks? Alcohol? How about insurance? Sure, insurance provides a safety net for people who get hit with unlucky events, but providers are still profiting from the fact that these misfortunes occur - maybe they should price policies to be a wash and just provide it as a social service?

Aug 29, 2017

Are you all serious about this ethical bullshit? Kinda dumb to consider that "somebody out there is hurt" unless you have some reputational risks imo. Ethics is by no means objective, fair or rational

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Dec 15, 2017

.

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Aug 29, 2017

I'd love to hear an actual answer to this question.

"There's no reason to be the richest man in the cemetery. You can't do business from there." - Colonel Sanders

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Dec 15, 2017

One monkey's opinion: it's tempting to assume that oil prices will spike with this forced reduction in production, but this potential gain in prices is mitigated by the closure of a lot of the refineries in the area (read: buyers of crude). So putting the two together, it feels like we'll have a decline in both supply and demand, and likely an overall negative effect for the sector.

Dec 15, 2017

Products are going to be up across the country as not only a lot of refining capacity is shut in but also because many pipeline such as Explorer and Magellan South have put a pause on operations. Colonial might have issues as well. This will send pretty large shocks through the markets.

Crude will most likely stay lower as well. Like the other guy said, this is bearish for crude itself due to the lack of refiners buying crude and despite some production being shut-in there has been much more refining capacity shut-in.

The real trade here isn't flat crude or products though. The crack spread and basis spreads are the place to focus the attention. Idiosyncratic shocks like this open up very wide spreads between products (crude and RBOB or crude and HO for example) and locations (Gulf coast and New York, Gulf Coast and Chicago, etc). Trading them as prices converge looks to be a potential trading opp.

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Dec 15, 2017

Agree 100%. One word - Colonial pipeline

Dec 15, 2017

Supply and Demand for CL down until operations of refineries / drills resume, but product demand will stay constant with less supply; expect to see an increase in gas(oline) and other refined product prices over the next couple months until Texas returns to normal (not sure where inventories are at).

Aug 29, 2017

Kind of F'ed up what you're looking to do, but why don't you look at flood maps and elevation maps? You could probably get a pretty clear picture of which parts of town are least susceptible to flooding.

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Aug 29, 2017

There is a reason the town grew and migrated West, and not East. http://en-us.topographic-map.com/places/Houston-14...
However, there are still pockets of areas in the NW that have flooded significantly.

To adress OP's question, I don't think people will leave Houston because of this so unless you are in the rehab construction business there's not much out of this for you.

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Aug 30, 2017

A buddy of mine in West Texas was bouncing around the idea of taking leftover oilfield doghouses from man camps and setting them up on land he has in Houston, but I am not sure if they would be approved by FEMA or how the whole process with FEMA works. I am sure other things will present themselves in the upcoming weeks.

Aug 30, 2017
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Aug 31, 2017
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