October 2009

Short Sale Relief: Fact or Fiction?

by Peter Giardini | October 6, 2009

A couple of weeks ago I posted an article that included a chart that showed that there are still a boat load (over a million) Adjustable Rate Mortgages that will reset between now and 2011. You can re-read that article here.

Many experts believe the Fed Rate will hold steady through most of 2010 and therefore, the number of mortgage resets may not see huge jumps. Many of these mortgages are tied to properties that are upside down, meaning the property value is less than the mortgage, and that will be the primary reason for increased defaults — or it will at least make these properties prime candidates for short sales.

Real estate investors can attest to how hard it has been to get lenders to let go of their inventory, and if you specialize in short sales, you know that at times, waiting for a short sale response from a lender is a lot like watching grass grow.

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Real Estate Market

Maryland and Virginia Real Estate Markets Show Promise

by Brendan O'Brien | October 5, 2009

Welcome to Virginia. Stay a while. Stay FOREVER Last week, I started looking into the Washington, DC Metropolitan Statistical Area (MSA), which consists of the District of Columbia, Northern Virginia and parts of Maryland. Given the growth in the federal budget over the last few years, I wasn’t surprised to see that the DC MSA was “the most educated and affluent metropolitan area in the United States,” according to Wikipedia.

The District of Columbia itself has made great strides in recent years, including greatly reducing the rate of violent crime. You may recall that it was known as America’s murder capital during the crack-filled 1990s. However, the city’s unemployment rate is actually fairly high, at 11.1%.

Maryland and Virginia, on the other hand, are very prosperous. Both are among the most economically successful states in the country.

Maryland’s Doing Pretty Well…

Maryland, DC’s (mostly) northeastern neighbor, has seen fairly consistent population increases and has a well-below-average unemployment rate of 7.2%. It actually has the highest median household income of any state, although this can be deceiving – the cost of living is also very high there. (The second highest median household income is in New Jersey, which is not currently an economic paradise.)

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Foreclosures

Top 20 tips for making offers on Freddie Mac/Home Steps REO properties

by Winston Westbrook | October 5, 2009

In today’s challenging real estate market where 30 offers on homes out here in Victorville, CA is the norm, (and I’m sure the same applies all over the United States) we need every little bit of information to help our offers stand out from the crowd.

I have made countless offers on REO properties including Freddie Mac deals, and these tips reflect my experience in dealing with them. These are the things that Freddie Mac always counters with and always wants flat out.

When making an offer to purchase a Freddie Mac or Home Steps owned property you should try and follow these guidelines to help your offer stand out from the crowd and help you save a day or two in negotiations with them.

The Top 20 Tips for Making offers on Freddie Mac, Home steps or FHLMC Properties

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Real Estate Investing

What is a Real Estate Syndication: The Basics

by Kyle Koller | October 4, 2009

In today’s society, the possibility of becoming wealthy exists but remains a lofty aspiration for most. While many have come to understand that real estate is one of the most effective mechanisms by which one can attain wealth, many would-be real estate investors are held back for one reason or another. If only there was a way such an investor could more easily cross the bridge into the wonderful world of real estate…

Bridging the gap

One viable option is to participate in a syndication. A syndication is simply a group of like minded investors that pool their resources together in order to participate in investments larger than they otherwise would have been able to alone. These resources may include liquid capital, expertise, project management, and a variety of other valuable things. Similarly, syndications come in a variety of flavors. Let’s look at reasons one might want to participate in a syndication before discussing the various types of syndications and common pitfalls to avoid.

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Real Estate Marketing

How Online Classified Ad Syndication Can Help You Sell Your Properties Faster!

by J. Lamar Ferren | October 3, 2009

In this blog post, I want to tell you about 3 powerful websites that can post your property listing ads all over the net on autopilot for FREE.

I don’t know about you, but I hate manually posting ads because it takes up too much of my time. I’m always look for ways to make my business marketing easier so I can concentrate on putting more deals together. Although my assistant has taken a lot of this weight off of my shoulders (which is something you may want to consider getting, if you haven’t), I still feel that online ad syndication sites are top notch.

Automation is something I thrive for!

So, what is Online Ad Syndication

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Real Estate

Bar Stool Economics

by Tom Koziol | October 2, 2009

You may have already seen this particular economics propoundment but, then, maybe you haven’t. It is making the round of the Internet. I decided to use it because it hammers the real estate debacle square on the jaw.

For whatever reason, the government decided to beat up the tenth man leaving the rest of us with what appears to be only one way to go. Of course, your interpretation may not parallel mine. So be it.

Start—

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the
way we pay our taxes, it would go something like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that’s what they decided to do.

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Commercial Real Estate

Developing Real Estate: How to Price Land for Profit

by Craig Grella | October 2, 2009

Pricing land for development can be a daunting task for the untrained investor. As a niche subset of both residential and commercial real estate, using comparables for land can be as dangerous to a developer as it is mysterious, sometimes causing the failure of what was certain to be a fantastic development.

However, for the savvy investor, there is one universally accepted land valuation method used by development professionals, corporations, and appraisers alike; the Land Residual Method. By using this method you will be able to determine the current and future value of any piece of land, whether its use be residential or commercial. You will also be able to price land, such that any development you propose will have built in profit. With some practice, you will be able to employ the land residual method in just a few moments, summing up the value of almost any property just on sight.

The land residual method has a fancy sounding name, but to use it all you need is an understanding of some simple math. The land residual method is a calculation that takes the highest and best use of a particular piece of property and subtracts out the total cost of development to arrive at the residual value: the land value. Once you have the numbers it’s that easy. “How do you get the numbers?” You ask. It takes some research, but even a novice investor can figure it out relatively quickly.

For the sake of this article I’ll be speaking to residential single family development or single family lot land. Rest assured, commercial development uses the same principles, though the calculations are a little more in depth.

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Real Estate Technology

Four-Eyes for Twitter

by Justin McClelland | October 1, 2009

As a real estate investor or professional, you should know by now that Social Media is here to stay. You don’t absolutely need to implement Social Media to be successful in this business, but why start a fire by rubbing two sticks when you can use a matchbook and can of gasoline?

Social Media for Real Estate

I’m going to cover just one of the many ways that you can use Social Media to bolster your Real Estate business. And I’ll focus on…

Twitter is a great micro-blogging network that allows you to interact with people of all types. I personally think of Twitter as a large party gathering where there are a plethora of conversations occurring at once and your welcome to butt in and join or you may just sit back, sip your patron, and take it all in while observing closely.

However you look at it, Twitter can be utilized as a great asset for your business. But I wouldn’t encourage you to just blast your listings, open houses, etcetera. If you do that, nobody will care. Instead I would encourage you to engage in the Twitter community and contribute to it. When you start contributing, you’ll be surprised what you get in return. As not only will the leads eventually come, but you will also gain a substantial amount of insight as you stay abreast of real-time tweets.

Tweet vs. Time

To be effective at utilizing Twitter and any other Social Media platforms, you will need to dedicate time to make it worth your while. Since there is no set-and-forget solution to Social Media, there is no getting around this fact.

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Real Estate Wholesaling

How to Close REO Wholesale Deals (Part 4 of 5): Using an LLC

by Stephani Davis | October 1, 2009

Today’s article is part four in a five part series, where I will be shedding light on the various methods available to close REO wholesale deals and get around the “No-Assignment” clause that most banks include in their addenda.

In weeks 1-3 I have discussed using simultaneous closings, quitclaim deeds, and double closings to get your REO wholesale deals to the closing table.

This week, I will be talking about using an LLC to wholesale your REO properties to your end buyer.

Using an LLC to Wholesale

If you decide to use this method to close your REO wholesale deals, you will be making your offer to the bank in the name of an LLC, creating the LLC if/when the bank accepts your offer, and then selling your membership/ownership in the LLC to your end buyer in exchange for your wholesale fee. When using this strategy, you are not selling the actual property to your end buyer, but rather the LLC which owns the contract to purchase the property.

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Commentary

Attention Real Estate Investors: “Youth Magnet Cities” Are Pulling You In!!!

by Charles Feldman | October 1, 2009

Attention real estate investors: Want to know where the markets of tomorrow are? (And, who wouldn’t considering how terrible the markets of today are for the most part!)

Okay then….listen up: Follow the 20 something crowd!

Seems urban planners consider some cities to be “youth-magnet cities”-and these tend to change from one generation to the next.

The Wall Street Journal put together a panel of experts to come up with a list of the next youth-magnet towns and here is what they came up with:

Believe it or not, Washington, DC ranked number one!!!

If you guessed this might have something to do with Mr. Obama, you’d be right. Apparently, the experts feels that many 20 somethings will flock to D.C. because they think Obama is soooooooooooooooooo awesome, chill, cool, whatever—and also figure that there may actually be some jobs in government since there don’t seem to be many in the private sector.

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