On today’s show, we are talking about buying in a fringe area. Today’s show is cautionary tale. As you know, I’m a proponent of the buy on the line, move the line strategy. That line exists in nearly every city in North America. On one side of the line is a hot neighborhood. There are expensive properties, desirable amenities like coffee shops and art galleries. On the other side of that line, you’re in the hood. You’re in an area where people on social assistance reside. The property values between these two areas can vary dramatically, even though they’re only a short distance apart.
This strategy is based on the notion that you can redevelop just on the wrong side of the line. When you do, now the line is on the other side of your property. Which means you can go do it again and again and again. You can literally move the line. But for a line to move, the line needs to be arbitrary. If the line is a school district, or a municipal boundary or a railway line, that boundary is going to be a lot more difficult to move.
If you go too deep into the hood, then you will probably fail. You won’t get people to bridge the gap to the hot neighbourhood.
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Host: Victor Menasce
email: podcast@victorjm.com
