All Forum Posts by: Paul De Luca

The low inventory problem has been a chronic one since the Great Recession, and the pandemic only amplified the problem. More sellers decided to wait and see what happens and decided to not list. Combine the lower-than-normal supply of homes because of the pandemic and the dramatically low interest rates, you have buyers feverishly competing for the limited supply of homes in the market which has driven prices up and made things even less affordable for the average buyer.

I think the primary reason there is a nationwide shortage of housing is due to the fact many homebuilders went out of business because of the Great Recession and demand plummeted for housing, leading to less building.

The homeownership rate fell from 67.1% at the start of the decade to a post-recession low of 62.9% during the second quarter of 2016. As a result of this demand environment, multifamily construction was the first sector of the industry to recover to relatively normal conditions, which were achieved in construction terms by 2015. Those that decided to opt out of homeownership obviously became renters.

Consider the following decade-based totals for single-family home construction:

1960s: 9.3 million starts

1970s: 11.4 million starts

1980s: 9.9 million starts

1990s: 11.0 million starts

2000s: 12.3 million starts

2010s: 6.8 million starts

It's a good question though why a lot of sellers are choosing to stay on the sidelines when it appears houses are selling at a premium nationwide. I'm sure the remote nature of work has caused people to value their homes more highly for one. Sellers that are older may be more wary of the coronavirus and don't want to make a move during the uncertainty.

TLDR; Great Recession ---> homebuilders went out of business, economy contracted causing housing to be less affordable,  decrease in demand for housing = under-built markets and less inventory.

Have you talked to a lender about getting pre-approved? They could also give you an idea of what kind of loan terms would be available to you. If you're not able to get financing I would find a partner to split the deal.

From everything I've read, the rule is that you need to occupy the property for a minimum of a year. Although, perhaps as long as it is still considered your primary residence it may be allowed. I would talk to your lender.

While you might think that just anyone can check that box and get FHA financing, it's against the law to submit fraudulent information on your loan application. You could be met with financial and legal issues if you say you'll live in the home, but then you don't follow through on it. @Zack Karp

What Nathan said. You need to be better prepared before pursuing opportunity. I think you need to take a step back and further educate yourself on wholesaling. Try connecting with an active wholesaler or work for them so you can learn the ropes.

Make sure you have a thorough tenant screening process in place once you close on the property. Be present for the inspection and ask questions if you don't understand something.

I believe you can only use the BP calculators for free a few times. Click on the dropdown menu in the upper right corner at your picture and go to "Account Upgrades" to see the differences between the membership levels.

I think non-qm (non-qualified loans) are a good option for self-employed individuals and real estate investors. I too will be running up against the problem of my inability to obtain traditional financing in the near future as an agent. I have not gotten any non-qm loans myself but I have been doing some research on them.

This website has some good information: https://www.bankrate.com/mortg...

Well done! Looking forward to hearing more about the results after closing.

Like Colleen said, the main entrance to the building should lead to two separate interior entrances to each unit in the foyer/common area. If there are not two separate entrances to each unit, ask the listing agent if it is a legal 2-flat or if there is a non-conforming unit/some other situation.

 If the football players have historically lived in the duplex, you may have strong future prospective tenants from them. As long as the property is managed properly, you shouldn't have issues in attracting renters though, athletes or not. You should also consider the seasonality associated with student housing rentals. Most students are going to be on campus from August through May and leave for the summer break. Seems like a great opportunity given the rent and price.

A red flag? Not necessarily, but perhaps unwise. Maybe the landlord only asked for a non-refundable move-in fee. I know that is pretty common in the Chicago market due to strict laws regarding security deposits.