Real Estate Investors: Do You See The Opportunities?
Can you believe we are mid-way through 2011!?! For the past 3-5 years, real estate investors across the country have been battling the the deflationary effects (not seen since the Great Depression) on the housing markets. Sure speculators were wiped out; however, lots of conservative (everyday hard working) American’s whom either hold a rental or rehab a home to re-sell whether part or full-time either lost everything or have had to buckle-down at a never foreseen level for our generations. The ball of momentum is changing -it’s up to you as to whether your going to go with it.
The last 60-90 days have been an absolute whirlwind for me -as it’s been the busiest I’ve been in years. Part of this -reflects a new business; however, my phone is ringing more than ever with the discussions of a “Real-Deal”. I’m not talking about the homes for sale @$40-50k (dime a dozen) that used to sell for @$100k. Sure -we might agree that it’ll be worth $100k in 10-15 years -again. How does that make us a living (or lock in a gain) today? That’s right -it doesn’t. You need to have the ability to buy that house for $15, 20, or 30k. At those prices, one has the ability to sell the property now (under 60 days) for a profit and/or to rent it out and make a sizable cash-flow. As a hard-money lender or landlord (with liquidity), those are the deals that I’m interested in. Sure -if you can obtain owner-financing (check out some of my financing articles), then one can pay a higher price with the ability to offset it in the terms let alone capture control of the real estate.
There is a constriction in supply of both distressed and quality rehabbed homes for the retail home-buyer. We are still seeing the lagging effects of the ‘robo-signing’ and thus, foreclosures and reo’s have stalled. Hang on -they’ll be back (and it might just be this fall/winter). We are also seeing less & less good quality rehabs for the home buyer. Either rehabbers are going out of business or their operations are getting bogged down in bloated inventory from shoddy rehabs or poor locations. This is opportunity! I have witnessed more wholesaling activity in the last 90 days then the prior 9 months. For the past 2-3 years, I have advocated that wholesalers were getting squeezed the most in the world of real estate. They are now in demand -again. Those who can find and pass along good value will see success.
Now -these maybe short-term blips as I’m discussing fresh data that is short in duration. I have espoused (in earlier articles this year) that I believe 2011 will be tough and filled with panic. You can see how that storm could play out to be frightful going into the winter months. Ignor the static. Be conservative with your numbers. Look around -others are having success. While the numbers out this past month for Jobs were abysmal, don’t worry -they will come. Look for the needs and fill it.