On today’s show we are talking about a twist on a strategy that we have been using for close to a decade. If you have been listening to this podcast for a while, you will have heard me talking about the buy on the line, move the line strategy.
This approach is an exceptionally good way of creating value in the market. What we mean by this strategy is to exploit the many dividing lines that emerge in real estate sub markets where on on side of the line there is a hot expensive neighbourhood and on the other side is an economically depressed area. Often these lines are arbitrary. They exist for no particularly good reason.
If you redevelop on the wrong side of the line, then guess what? The line has moved and is now on the other side of your property. Because there are no comparable properties on the poor side of the line, you will get a valuation similar to the hot neighborhood next door.
Today I want to revise the description to include one very specific special case.
If the line is a municipal boundary and the city is a growing city, you might want to consider property that is just outside the municipal boundary. If the city has a history of annexing land and growing its boundary, this can also be another opportunity to create tremendous value.
Host: Victor Menasce