All Forum Posts by: Cheryl C.

Hi Rich. These are not balloons, but will adjust. I was around in the early 80's as well. This bank will be around. In fact, they were all over the news being interviewed (about their strength) back in 09 when others were going under. Many of my properties are paid off and others close to it. I'm sitting on plenty of cash should the need arise to pay these off. The payments I am making on these put them on about an 8yr am schedule. No worries here even if vacancy rates shot up (doubtful).

Rich, I'll jump in here while you are waiting to hear from Michael.. I, too, have too many properties for conventional investor financing. I use a small local bank and get "commercial" loans. 5.75% with 1/2 pt, fixed for 5 yrs and then adjusts. I'll have to look at the notes to see the adjustment terms. I wish I could get the 30yr money, but this is far better than any hard money I've heard of. I'm blitzing these off, while sticking with the 30yr AM on my "good" refi's obtained in 2003 or 2004 in the mid-lower 5's. An added bonus is there is no application or appraisal because I've had a long-term (25yr) relationship with this bank. They can close in a week.

I agree that real estate is local. Some areas will recover faster than others. Although my region was whacked pretty good, the outlying (exurbs) took it on the chin. Certain close-in areas were hardly hit. I agree that it will be years before we see some decent appreciation but, again, this will vary.

As to the foreign buyer's, they represented 7% of sale in 2010 but according to "Splash" the numbers are swelling. I've recently seen 2 purchases in a small development in SW FL. One Aussie and one from Argentina. Granted this is a tiny sample but overall 18% of all agents (nationwide) reported a sale to a foreign person.

Our current Market reminds me of the 90's, although this is much worse. I follow inventory and the Virginia suburbs are maintaining at about one-third of peak. Our unemployment in Northern Virginia is in the mid 4's. Lending will loosen in a few years.

Rich,

I'm up here in the Northern Virginia/DC area and follow the regional housing blogs. I believe people truly want to buy but are afraid that prices might fall or they will lose their job. I think we have a group of 25-35yr olds that will buy when unemployment eases up and the horrific stories of their friends buying at peak fade. We are well off peak pricing and affordability levels are at decades lows. Our vacancy rate is 3.5% (half the National average) and rents are up 8%YOY. I'm happy to have them rent for ten years, but they will buy eventually. Remember, marriage and kids are delayed from earlier generations. Once those kids come, they will be buying. Just my opinion.

Here it's called an Allonge (alonge?). Just a modification that should be recorded. Best to have a real estate lawyer draft it.

I agree with Michael. This too shall pass. Memories are short and the American Dream will be back. Meanwhile LL's will make alot of $$$.

Sharad,

You are missing working your but off trying to manage 8 low end properties vs one decent property.

I put a few examples up on the "when buying rentals is cashflow your only consideration" thread.

Sharad,

That doesn't confuse me and I never pay market. I believe that you need to make money going in or it's not the right deal. I know my target areas inside and out. I know what the future development will be. I know as best I can where appreciation will be best. It is no guarantee, but a very educated guess. I'm willing to be break-even at the outset (the tenants will eventually buy the place for me) if I believe there is significant upside. I know that many/most of you don't agree, but it works for me.

ex. I'd been looking on and off for a number of years for large waterfront acreage close to my home. In early 2005 (a very hot market) such a property was listed. I had it UC within 2 days with a 90 day feasibility. I had to show cash (875K). We sold a long term rental for 855K and 1031'd into it. We ended up with a mortgage of 375K and a little old stone house that rents for $1,450. The place was worth 2mil and still is (based on a recent CMA). I believe it will be 3mil in 10yrs. Do I care about 1K/month neg. (double using 50%) or making a couple million? Which do you think?

mine is re nw (it does include some of my husbands cre)