

I’ve been blogging about the housing bubble since September of 2006. During the initial months, I was receiving 50 to 60 hits a day. Now in a few short months, we are reaching an audience of thousands a day. Suddenly 90% of articles in the mainstream media are negative about the housing bubble. We have folks making chump change being able to find access to millions of dollars in credit simply because they have a pulse and are able to fog the mirror on their leased Lexus. Even though I’ve featured over 24 homes in Real Homes of Genius, I still get people in the delusional state thinking that there is no housing bubble. “Dr. Housing Bubble, you cherry pick homes and what does that prove?” they say in a condescending manner. Aside from the fact that the median value of homes is outrageously priced in every county in Southern California (and the median is derived from an aggregate of homes) I’m simply making the story more tangible for the readers who still have doubts.

To quell these doubts, I spent a few hours picking two homes in each of 5 major counties in Southern California to highlight the magnitude of this bubble. After all, If I’m able to find 10 homes in Wonderland in a few hours how many more out there exist? Today we have a special Real Homes of Genius, today we salute you Southern California with our Real Homes of Genius Award.

Riverside County

#10 – Riverside

Price: $209,000

Sqaure Feet: 768

Median Rent in Area: $700

Our first home takes us to Riverside proper. This beautiful 3 bedroom mansion is a fixer-upper and a handy man special. Once you dump $100,000 in renovations, you can expect a whopping rental income of $700 a month even though your monthly payment will run somewhere in the neighborhood of $2,000. Talk about cash flow! Initially this home was priced at $295,000 but so many people were stopping by, they decided to knock off nearly $100,000 because it was too fantastic. Maybe in a few more months, they’ll bring it down by another $100,000.

#9 – Perris

Price: $234,900

Square Feet: 850

Median Rent in Area: $695

Why live in Paris France when you can live in Perris California ! This is how the rich and famous live. This wonderful 850 square foot home is inspired by the architectural genius of Da Vinci and you can tell by looking at the picture above. This home is designed to entertain that pesky and picky buyer out there who wants everything but is on a $300,000 or less budget. The so called champagne taste with a beer income. Even though your monthly payment will range from $2,100 you will be able to rent it out for a whopping $695. No wonder why Donald Trump is so rich. Real estate investing is easy. Where do we sign up?

San Bernadino County

#8 – Fontana

Price: $273,900

Square Feet: 728

Median Rent in Area: $725

Our next home takes us to Fontana in the heart of San Bernardino County . This place is bank owned and the upkeep is impeccable as you can tell from the picture above. The lawn hasn’t been mowed in ages but hey, we are talking Southern California here and money grows on trees (and lawns for that matter). This 728 square foot beauty is banked owned and ready for you to invest in. Even though the bank is holding onto appraisals from 2005 and is desperately hoping yesteryear will come again, we are crossing our fingers for the Easter Bunny to arrive. This place will carry a monthly nut of about $2,500 but you’ll be raking in the cold hard green at $725 a month. Another cash flow property for you! We’re quickly on our way to becoming real estate moguls…

#7 – Victorville

Price: $190,000

Square Feet: 860

Media Rent in Area: $550

Alert! This place is so hot we had to get James Bond to take a snap shot of this place via telescopic camera. This gorgeous 860 square foot home is amazing in one of the hottest (literally) areas of Southern California . As you can see from the picture, you may have a lot of vacant land (desert) next to you but hey, this is for potential growth here! Think big! Don’t let the neg-head housing bears bring you down to reality. It is much funner in made up world, trust me. Even though you’ll pay $1,500 a month in taxes and fees, you can rent it out for $550 a month. The bank will love you with your maximum cash flow strategies.

San Diego County

#6 – Chula Vista

Price: $295,000 – $350,000

Square Feet: N/A

Median Rent in Area: $818

Here we see a wonderful pricing tactic found only in high priced metro areas, the range. We give you a range that is open to a 20% negotiation value and you give us an offer. The seller of this place tells us that this place is “not for the faint of heart” because this magnificent lawn will knock your socks off and maybe give you a coronary explosion. By the look of this place and the lot, we can speculate that it is 800+ square feet. Your monthly nut will be from $2,400 to $2,700, we’ll give you a range as well, and you will cash flow with $818 a month in rent. Going down South makes a whole lot of sense eh?

#5 – National City

Price: $299,900

Square Feet: 432

Median Rent in Area: $820

If you’re the patriotic sort, what better place to live than National City ? We have this wonderful sprawling 432 square foot palace at $299,900. Like the car ads you see for $9,999.99, this place is designed to attract the sub-$300,000 buyers. When we look at the median rent in the area we see that a place like this with $50,000 in renovations will go for $820 a month. Maybe I should write a book like Robert Kiyosaki because with all these positive cash-flow properties, 24 hours in a day simply isn’t enough!

Orange County

#4 – Anaheim

Price: $459,900

Square Feet: 850

Median Rent in Area: $995

Home of Disneyland and Mickey Mouse. Also home to interesting depth of field photography. This gorgeous half-a-million dollar home rests beautifully on 850 square feet. Even though your mortgage will run you $3,500 a month, you can rent this place out for $995. Go out and refinance your home equity and put a down payment on this place now! This investment opportunity will not last.

#3 – Santa Ana

Price: $435,000

Square Feet: 910

Median Rent in Area: $945

All these fantastic deals are making me itchy to call my mortgage broker! I’m sure you’re getting juiced up to purchase each of these homes. This next beauty is nestled in Santa Ana . At 910 square feet it is one of the larger homes we are featuring. When we analyze the income of folks in the area, they are pulling in slightly below $50,000 per year for family income. The monthly payment on this place will be around $3,500 so that’ll eat up about 90% of their net income. Who cares about debt ratios when you can use leverage to make it happen! Time to act since this place is not only in SoCal, but in the OC.

Los Angeles County

#2 – Huntington Park

Price: $359,000

Square Feet: 669

Median Rent in Area: $950

There is no other place like Huntington Park . Easily confused with Huntington Beach , this area in Los Angeles has a lot of potential. I’ve featured a couple of places in a previous Real Homes of Genius in this area, but this 669 square foot dream home is for the ages. Even though you’ll be paying about $2,800 a month in carrying costs, you will be able to recoup that by renting this place out for $950 a month. Business is good my friends!

#1 – Compton

Price: $279,000

Square Feet: 639

Median Rent in Area: $800

Our final home brings us to Compton California . Above we have a wonderful 639 square foot home for $279,000. This magnificent place is under $300,000, in Southern California , and therefore you should buy it. Philosophy and logic will prove this out in any theorem. This place is a must for any savvy real estate investor. Yes, your carrying cost will be about $2,300 a month but you’ll be renting it out for $800. I see many light bulbs turning on and all you potential investors are making a beeline to your agents office. This one won’t last folks!

Conclusion

Archimedes of Syracuse, the mathematician and engineer from Southern Italy figured if you could give him enough leverage, he alone could move the entire world. I know with enough credit leverage, you’ll find a way to purchase all the above properties. And the exciting thing is that you’ll find enough hungry brokers willing to finance you on all these properties. All you need to do is try. If you don’t try, you are guaranteed to fail but if you make a serious and wholehearted attempt, you will succeed beyond your wildest dreams. Yes the numbers don’t work out exactly to your advantage but finance and real estate evaluation is for sissy pansies who have no guts to take a risk in real estate. Even though I invest out of state in properties that cash-flow positively, maybe I’m missing something with the negative cash-flow game here in my home town. It is time to take advantage of this spectacular time in history. From the Southern tip of Chula Vista , to the desert city of Victorville , to the OC, and finally coming back to Compton California we have plenty of deals to go around.

Today we Salute you Southern California with the Real Homes of Genius Award.