Property Manager · Passaic, NJ · Member since 2008 · 369 posts · 83 votes
I called the local realtor I've been working with for the past few motnhs on 2 homes that interested me. She told me they're newly listed and already pending. She said the real estate this past week is flying off the shelves in Central Florida. Somehow I find this very hard to believe.
Selling or accepting an offer is the easy part. Trying to find a lender that will actually fund a loan is almost impossible currently. Changes just recently include
1. No more 90% investor loans
2. Lenders not doing more than 4 loans to any one investor.
These are big changes.
Selling or accepting an offer is the easy part. Trying to find a lender that will actually fund a loan is almost impossible currently. Changes just recently include
1. No more 90% investor loans
2. Lenders not doing more than 4 loans to any one investor.
These are big changes.
This is true for traditional Fannie/Freddie loans, but not necessarily the case for portfolio lenders, rehab loans, or hard money.
Do your research...if you have decent credit, income and/or cash reserves, you can find loans...
Here in Las Vegas REOs are seeing multiple offers as well. Those trying to sell retail are generally unable to compete with all of the REO properties available. The banks have slashed the prices so much that they are generally be sold for more than the asking price because of the multiple offers.
Ditto here in Denver! Most REO properties, especially in the lower price ranges have 5 to 10 offers on them and go to "highest and best" status - and are under contract for over asking price - within days!
Our primarly lender "cut us off" about 6 months ago. We have great credit (750+ for each of the 4 Sub S shareholders) and PERFECT payment history. They are simply not doing investor loans for SFD or multis with 4 units or less (we invest almost exclusively in this size multi). Now, I guess if we were to bring 30% or 40% of contract price to the table, they may reconsider based on our history.
The silver lining, if there is one, is we jumped on this right away and about 5 months ago went to two other banks with a full investor's packet, including: financial statements, tax returns, LTV or each property and entire portfolio, and portfolio holdings with current rents and cash flow per unit. Both of those banks will play ball with us. They will only do 80% LTV of contract price or appraisal (whichever is less) by the letter of their policies, but on our last deal (4 months ago) the one did 80% LTV of appraised value, which came in significantly higher than contract price, giving us about $20k cash out for remodeling expenses.
It is certainly a touch-and-go market with the well-established players who have good credit and a clean history still able to do deals.
I hope you all are not using your personal credit to get these deals done. Get your own Real Estate Investing Company, get your company establish..(2years) get the tradeslines complete then go for the business line of credit.. start small, then work your way up....buy house less than $60,000, turn them into section 8s, Wholesale to other investors..There are some many families who need houses and the govt will pay the rent...too many people relying on the traditional banking system...Still need to have your personal credit in check 680 and above...I knew this one landlord from NYC, who had like 25 apartment buildings and each building had thier own LLC..now that's the way to go..
There are bidding wars here (in Tampa), when REOs come on the market at a good price.
If the numbers are good, the deals are gone within a day or two. Investors are still buying, but they are buying cheap, cheap, cheap.
Steph
Getting in to a bidding war over an investment property sounds like a losing battle from the get-go. I'd expect that every bid you make is just hacking at your profits, you know? At some point, the deal might start to look somewhat unappealing, wouldn't it?
There are bidding wars for REOs where I'm at. It's just so strange to me to see people buying rentals that won't cash flow, or buying flippers that remain on the market for months.
Multiple offers on the cheapest REOs in my market also. We're seeing a mix of investors and owner-occupied buyers. It's amazing how many deals my buyers are losing to all-cash buyers. There's a lot of money out there buying deals now.
Not that much quality inventory in Milwaukee and the prices are still not where they need to be to make these deals work. People are buying, but I do not see how they are getting cash flow. I think they are speculating, which is too risky for me. I have not purchased anything recently because I cant get the numbers to work on the property I am interested in.
Give numbers on the types of properties that you are looking for in Milwaukee area. Also, include zip codes. I know that I sent you three that were in low or low rent as you call them. I do not want people to risk lives, but look at it from this perspective. You are sitting on the side line waiting for the right opportunity. Create the right opportunity. The reason I say that even if you do not want to go into less desireable areas, hire a property manager and you are local so you can go and check up on them by doing a pass every now and then. Some one is buying properties in those areas where you say no. All I am saying is look at the other side of the coin.
Now I usually charge for this INFO, but I am going to give it to you for free. Why not market to vacant and abandoned properties in areas where you feel like you want to be. Meaning people that own houses out right free and clear. I am sure there are many in the Milwaukee area because it is a older city with many older houses.
Are you looking for that perfect situation or one that you can turn into that perfect situation.