Zillow Offers Guidelines: Investing in Real Estate

With all the short sales and foreclosures it makes it an ideal time to buy real estate. I came across an excellent post on Zillow, Investing? 6 Types of Properties to Pursue which offers solid advice on scoping out investment properties.

Leonard Baron says, “Too many people buy fixer-uppers thinking they’ll add value by doing a renovation. Then they get mired in a much more expensive and time consuming property than they ever expected. More money into the property means lower investment returns for you and less wealth-building than you expected.”

Investors get mesmerized by a “cheap price” however price is just one factor in the equation. Location, location, location is still very important, along with the rental demand. What about resale, will the property sale easy in the future?

Our Turnkey Operation was created to help investors purchase prime rental properties. Our rehab team can help with properties that need CPR, (Carpet, Paint, Repair). Once repairs are complete we put it on the market for rent.

Whether you’re a long time investor who wants to add to your existing portfolio, or a newbie venturing into investing in rental properties for the first time, contact me. I am confident you’ll be impressed with how easy we make it to invest in real estate.

Existing Home Sales Leap To 2-Year High

Guest post by Chris Brown

The home resale market put forth another strong data set last week. Home sales prices are higher nationwide and sales volume has moved to a 2-year high.

According to the National Association of REALTORS®, 4.82 million “existing homes” sold on a seasonally-adjusted, annualized basis in August, representing a near 8 percent improvement from the month prior and a nine percent jump from August 2011.

An existing home is a home which has been previously occupied.

Home sales were unevenly split across price tiers, with more than half of all homes selling for less than $250,000. This suggests that the first-time home buyers and real estate investors continue to be active in today’s market as a foundation for growth is built.

According to the Existing Home Sales data :

·        First-time buyers accounted for 31% of all home sales

·        Real estate investors accounted for 18% of all home sales

·        Other, repeat buyers accounted for 51% of all home sales

Also noteworthy is that “distressed homes” accounted for the smallest percentage of overall home sales since the real estate trade group starting tracking such data.

In August, homes in various stages of foreclosures accounted for 12% of all sales and sold at an average discount of 19 percent below market value. Short sale homes accounted for 10% of all sales and sold at an average discount of 13 percent below market value.

Of all the data in the August Existing Home Sales report, though, perhaps most relevant to today’s buyers is the shrinking national housing supply.

At August’s end, there were 2.47 million homes listed for sale nationwide, a three percent increase from the month prior. However, because the pool of available home buyers is increasing more rapidly than the number of homes for sale, housing supplies fell 0.3 months to 6.1 months.

This means that at the current pace of sales, the entire housing supply would be sold by March 2013.

For today’s home buyers, home affordability appears poised to worsen. Mortgage rates and home prices remain low today, but market conditions like these rarely last long. Talk to your real estate agent about what options you have ahead of you. 2012 is coming to a close.

By 2013, the housing recovery may be fully underway. 

Chris Brown, Certified Mortgage Planners 407.367.2974 / Chris@cmpFL.com

Renting a Home After Short Sale or Foreclosure

With all of the short sales and foreclosures taking place borrowers are wondering how to rent with bad credit. Prospective Tenants have their credit pulled as part of the application process. Prior to the real estate anomaly, a low credit score would result in being declined, however, with the over whelming number of people losing their homes in short sales and foreclosures, owners and property managers find themselves making concessions.

In a post How to Rent a Home if You Have Bed Credit, Tamara Holmes reported, “According to a recent survey by Rent.com, 81 percent of property managers have seen a decline in the credit worthiness or credit score of prospective renters, and due to the shift, 43 three percent of landlords reduced their credit policy standards in order to fill vacancies.”

I realize many of the people who have lost their homes are good people who just hit hard times. If a prospective tenant just has a blip on their credit report associated to a distressed sale situation and no derogatory or criminal issues, I go to bat for them with our owners. What prospective tenants need to understand is, owners are the ones that approve or decline. I have to say, most of the people who I have rented to that have come from a distressed sale have turned out to be some of my best tenants.

Prospective tenants should have a letter prepared explaining their situation and expect to pay first and last month’s rent, along with a security deposit, along with having, references you can provide.

We do our very best to help folks coming out of mortgage misery. You can search for rental properties at Rent With Karen

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HomePath Financing Foreclosures

Wow, what a great option for home financing!   Fannie Mae properties listed on their website www.homepath.com are eligible for HomePath mortgages.  HomePath is offered exclusively to borrowers buying homes from Fannie Mae.  There are options for Primary Residences, Second Homes and Investment properties to include Single Family Residences and Condominiums.   Primary residences require a minimum of 3% down payment, with 10% down payment on Second Homes and Investment properties. 

 A few advantages to mention regarding the benefits of HomePath financing are No PMI (private mortgage insurance), No Appraisal, No Condo Questionnaire, and No need to fix repairs to qualify for financing.

Generally, if the borrower does not have 20% down payment, mortgage insurance would be required.  No mortgage insurance can save a borrower thousands of dollars over the life of the loan. For example, if the mortgage insurance is $100 per month, with a minimum of 5 years to keep on the mortgage, that is $6000 over the life of the loan.  With Homepath financing, mortgage insurance would not be required, thus a huge savings to the borrower. 

There can be many issues with a house appraising.  With HomePath, the sales price is used as the property value.  Fannie Mae has determined the price and the lender will accept that value without an appraisal.

Condominiums do not require a review except to verify that the project is not a Condotel.  This would avoid the need for a condo questionnaire to be completed.  The information contained on the condo questionnaire may make a condo ineligible for financing under normal conventional financing.    With HomePath, that would not be an issue.  Another great advantage is that some lenders have no additional LTV limits that would apply to Florida properties. 

A Fannie Mae-owned house or condominium may need repairs but would not be able to be completed prior to purchase. By applying for a HomePath mortgage, which doesn't require a property inspection or appraisal, the borrower would be able to finance the property and make the repairs after closing.  HomePath allows for 6% seller contributions for Primary and Second Homes, and 2% seller contributions for Investment Property. This could allow the borrower to keep more of their closing costs money in their own pocket to complete the repairs needed after closing. 

Happy to answer your questions on HomePath Financing.

Dawn M. Houser Senior Mortgage Banker

Phone:  239-464-9455   / Fax:  866-686-5382  / Email:  Dawn.Houser@aemc.cc

 

 

Investors Provide Rental Properties for Growing Demand

Many of our investors who have properties managed with Showcase Property Management are purchasing short sales and foreclosures and not just expanding their portfolio but meeting the growing demands of the rental market. In many cases the owners are able to remain in their home and pay rent, less than the mortgage payment they could no longer afford to pay.
 
 
Investors located all across the United States receive emails with MLS Property Alerts that have short sales and foreclosures for sale in prime rental markets in Brevard County, FL. Each time a distressed property comes on the market they receive an email notification that provides an MLS report of property details and photos. The KGB sales team assists with obtaining the properties our investors choose to buy.

 

Our turn key team includes qualilty professionals who are quick to provide estimates for property inspections, flooring, window and door replacement, window treatments, pest control, plumbing, electrical work, lawn and landscaping, pool service and a host of other sevices to help transform properties, especially foreclosures that can need extensive work. The investor is made aware of problems and can determine cost to rectify issues. If the property needs extensive work, our rehab team gets it back in tip top shape to be a desirable home we manage and market to rent. We refer to this has our Investor Turnkey Program

If you're an investor who wants to expand you portfolio or you want to get started with obtaining investment properties, just complete the information below:

 

Short Sales Expanding Rental Market

Properties selling short are attracting investors who have time to wait for the slow short sale process to complete. The folks coming out of a short sale need a place to live creating a drastic change in the demand for rentals.

The attraction for investors to buy short sales and foreclosures is the demand for rentals will remain strong for at least the next five years – if not longer.

What Will Happen After the Election

It will be interesting to see what will happen in 2013, after the election, after the next president of the USA makes the inauguration speech. Will the millions of foreclosures behind the scenes make their way back to the market?

The countless number of short sales are impacting real estate on the Space Coast in a number of ways.

For the folks facing foreclosure, there’s good news. Borrowers can stop the foreclosure process by selling their property in a short sale. The National Mortgage Settlement prohibits lenders from doing dual track foreclosures.

A borrower can bounce back from a short sale in a couple of years, verses the severe damage of a foreclosure, which remains on a credit report permanently.

At Showcase Property Management we have become much more accommodating with helping people obtain a rental property after a short sale, after all, it is the cause of the growing rental demand. We analyze credit history and advise owners to to review the hardship when evaluating prospective tenants.

The investors, well their banking on the fact that after the short sale, someone else selling short will need a place to live. They are assured a healthy rental market for quite a few years.

If your someone coming out of a short sale, or an investor looking to expand your portfolio, my team and I can help. Give me a call 321.394-7750

What Happens to Deficiency in a Short Sale

Over the past few years many of our owners at Showcase Property Management have been confronted with selling their property in a short sale. One of the biggest concerns is always the deficiency that results from a short sale. I found this very informative video that reviews various short sale scenarios which addresses deficiency with an investment property.

Walking away from a property and foreclosing is very damaging, a short sale is much easier to recover from, typically about two years. Lenders now prefer to avoid foreclosing and short sales  are now surpassing foreclosures.

If you are an owner struggling with an over whelming mortgage, I invite you to reach out to me for mortgage relief. Learn what’s entailed with selling property short.

Tips to secure your property in a hot rental market

Make preparations to rent property:

Due to short sales and foreclosures there is a high demand for rental properties. I recommend you view the Showcase Rental Application and gather all of the required documents you will need to submit your application, property management companies ask for basically the same information. Application fees which run from $45 to $75 must usually be in the form of a cashier check or money order. Typically personal checks are not accepted, some companies do accept a credit card, most do not.

If you have pets: at Showcase Property Management you will have to provide a recent pet certificate from your vet as well as an additional pet deposit.

Once you are approved: you will be required to provide the security deposit, do this as quickly as possible. The property remains on the market until the security deposit is paid in full. After the deposit is received and the property is removed from the market, the deposit is not refundable. This means  if you DO NOT sign the lease, the money for the security deposit IS NOT refunded.

Discuss making arrangement to turn on utilities when you provide your security deposit.

You will receive keys at the lease signing, if you request to move-in prior to your lease date, rent is pro-rated on a daily basis.  Prior to moving in be sure to take photos and note any issues pertaining to the property so you will not be held responsible.

Please keep in mind agents work on a percentage of the lease amount, they are not compensated until after the lease signing. Agents  work diligently to help you find the ideal place to call home, all they ask in return is your loyalty to work to them until you sign your lease.

You can request a copy of the Showcase Property Management application in the comment area below.

Short Sales and Foreclosures Shift Rental Market

All of the short sales and foreclosures taking place leave people in need of a home to rent, making it a great time for investors to purchase investment properties, not just in Brevard County, FL, but anywhere in the sunshine state. The post The New Growth Business; Becoming a Landlord states, “Investors from Warren Buffett to mega financiers like GTIS Partners to small-time wholesalers are looking to cash in on the U.S. Housing market.”

Typically investors worry about vacancy rate, but the distressed property real estate market has created a huge demand for rental properties which is likely to be in place for the next 10 years. At that time the market will rally back to stability, making it an ideal time to sell, perhaps to the tenants who are renting the property.

Buying investment property still requires expertise of what will be most rentable for the long haul and saleable in the future. There are constants in real estate investing that are timeless, meaning buying property because it’s cheap, doesn’t always provide the greatest rate of return.

The shift in the rental market makes it an ideal time to invest. Drop us a reply below to get a list of the ideal investment properties to purchase in Brevard County, FL.

Why You Should Buy a Rental Property…

I came across this post, Why You Should Buy a Rental Property and when I read, “The best investments we’ve made are the ones no one else would touch.” I can see why David Ackman is hot on the Single Family Home Rental Property.  “They are cheap,” he says.  “They are a buy.” All I have to say is I agree 100%, properties are cheap in many areas of Brevard County as well as the entire state of Florida.

Now is the time for investors to scoop up these properties priced drastically below market value. My long time experience as a property manager not only helps investors determine where to buy for the best rate of return, but I am also able to provide the services of managing properties and help protect their values. By conducting regular inspections, my team and I are able to determine if the property is being maintained and to check for issues tenants may not even realize are problems.

With all of the short sales and foreclosures there is a growing need for rental properties. People coming out of distressed sales need a place to live. Most of these people make excellent tenants, they’re just victims of the economic disaster.

Why should you buy a rental property? Because the time is ripe to buy not one, but maybe two or three rental properties. When the market rallies back to stability selling them should produce a very nice profit.

 

Link to the article:

http://www.noradarealestate.com/blog/why-you-should-buy-a-rental-property/