Low Supply, High Demand = Big Opportunity
Taking advantage of the changing Real Estate Market is what I do best. Right now, in Michigan, Florida, California and a few other high REO hot spots, the market has hit a sudden bottom. Not only has it bottomed, its actually getting a little crazy and moving back up! Homeowners and Investors are paying 20-25% more for properties than they were a month ago. I’m mildly shocked.
Here are the 4 reasons why I believe this is happening.
1. Money is easy and cheap if you can get govt financing. FHA mortgages are fairly easy to get with a 580 credit score and full time job being the core reqs. This means more buyers. 2. The Clean REO’s are all gone. Due to the freeze on foreclosures, there is nothing on the market that was matching prices buyers saw even a month ago. 3. Its springtime and believe buyers psychologically are sick of the all crap they here about concerning the economy. 4. Buyers realize there is an inventory shortage and are starting to panic, creating a sense of urgency to buy now.
So, what am I doing about it? Well, I’m going on a buying frenzy. I’m making offers on everything that’s distressed! Everything! I’m also staying very short. My goal is to have an inventory of 20-30 rehabs in place by June 1 and have all of them sold by Sept 1. I am also following my formula of 60% LTV less repairs. Roll up your sleeves, its time to adapt and make more cash!
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Bob,
I’m new to the REI game–so new, in fact, that I haven’t closed my first deal yet. I listened to your webcast on REItips.com, and got some great ideas.
I’m located in San Jose, California, the Santa Clara County seat and “capitol of Silicon Valley.” Last month (August, 2009) 41% of the sales here in Santa Clara County were overbids.
Although I’ve been focusing my efforts on the Atlanta market, I saw a distressed REO locally (two blocks from some of my wife’s relatives) that I intend to try the 60% approach to. I’ll keep you posted.
Thanks for all your help.
Daryl
Daryl | Sep 26, 2009 | Reply