Bobby J
Beach Fanatic
It really is a good read. I wish I would have been directed in this area at a young age. Being a landlord can be tough but not really to bad if that is all you do.
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Priced right REOs are moving fast
- Thread starter 30ashopper
- Start date
It really is a good read. I wish I would have been directed in this area at a young age. Being a landlord can be tough but not really to bad if that is all you do.
SHELLY
SoWal Insider
seems so boring..... Have you not ever had dreams of being the greeter at Walmart?
I'm doing just fine....but I think those jobs are now filled with former passengers of the RE gravy train.
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SHELLY
SoWal Insider
This is what the Book "Rich Dad, poor Dad" is about. Your primary home is a liability. But the author buys other homes with cash for rental income. All monies made are used to establish more rental properties until the income passes your job and you can move into financial freedom! The American dream!
...and we all know how that story ended for quite a few of his "followers." :roll:
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SHELLY
SoWal Insider
In too many cases, the 'wad' was produced from HELOCing one's primary residence out the whazoo, then HELOCing the 2nd property to purchase the 3rd property and on and on...but that boat has already sailed. :roll:
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Busta Hustle
Beach Fanatic
uh, ya mean "short sailed" ?
Bobby J
Beach Fanatic
rapunzel
Beach Fanatic
Serious buyers love this market?
Well, I guess that depends on how risk adverse they are. I know that my tolerance for risk was pretty much wiped out by Katrina. I look at Shelly's list and think "certain we'll live there for five years?" Well, unless there's a horrible hurricane and all the patients move away, or a pandemic makes tourism verboten, or an asteroid crashes into the Yucatan and causes a big tidal wave and all the homes are swept away along with the hospital.
I have made up a list of houses I love, I researched sales in their areas and and I compared those with other "comps" as I see them (which is really what matters when you're looking for a home) -- houses that I like equally well that sold recently in and around SoWal -- when real comps weren't available. I made a list of what I was willing to pay, and then looked to see if the houses were mortgaged up way beyond what I thought was reasonable TO ME. I was left with four houses. As examples, one is listed at $899K, and I LOVE it and think it's a fair buy at $580K, based on recent sales + a bonus of $130K for better view. Another is listed at $595K, and I think a good price on it would be $315K, with no bonus because it's only two bedrooms and if someone were to abandon a child in a basket on our doorstep it would no longer fit every need.
So, big spreads. If that makes me not serious, then so be it. I still plan to try, but if a rental comes along I won't make the mistake of asking for 24 hours to throw out an offer on the most favorite house again. I'm funny like that when it comes to having shelter.
Well, I guess that depends on how risk adverse they are. I know that my tolerance for risk was pretty much wiped out by Katrina. I look at Shelly's list and think "certain we'll live there for five years?" Well, unless there's a horrible hurricane and all the patients move away, or a pandemic makes tourism verboten, or an asteroid crashes into the Yucatan and causes a big tidal wave and all the homes are swept away along with the hospital.
I have made up a list of houses I love, I researched sales in their areas and and I compared those with other "comps" as I see them (which is really what matters when you're looking for a home) -- houses that I like equally well that sold recently in and around SoWal -- when real comps weren't available. I made a list of what I was willing to pay, and then looked to see if the houses were mortgaged up way beyond what I thought was reasonable TO ME. I was left with four houses. As examples, one is listed at $899K, and I LOVE it and think it's a fair buy at $580K, based on recent sales + a bonus of $130K for better view. Another is listed at $595K, and I think a good price on it would be $315K, with no bonus because it's only two bedrooms and if someone were to abandon a child in a basket on our doorstep it would no longer fit every need.
So, big spreads. If that makes me not serious, then so be it. I still plan to try, but if a rental comes along I won't make the mistake of asking for 24 hours to throw out an offer on the most favorite house again. I'm funny like that when it comes to having shelter.
scooterbug44
SoWal Expert
IMO serious buyers like this market better than the one a year or two ago because some much needed price reality is appearing, but are frustrated by the short sales and banks.
I would focus much more on what you are willing and able to pay for the home you want and come up with a fair price that way. It's a residence and fulfills a basic need for shelter, it's not a gold brick!
Assessments, comps, and prices are all over the place and I don't feel that I should have to pay more because the seller was greedy and leveraged themselves into a debt much larger than the property is worth with multiple loans and interest only payments.
Think of it as real estate consignment shopping - just because someone once paid inflated retail doesn't mean you have to!
I would focus much more on what you are willing and able to pay for the home you want and come up with a fair price that way. It's a residence and fulfills a basic need for shelter, it's not a gold brick!
Assessments, comps, and prices are all over the place and I don't feel that I should have to pay more because the seller was greedy and leveraged themselves into a debt much larger than the property is worth with multiple loans and interest only payments.
Think of it as real estate consignment shopping - just because someone once paid inflated retail doesn't mean you have to!
30ashopper
SoWal Insider
I see spreads like that all over the place rapunzel, so you are not alone. I'm also a believer in Shelly's list so I won't be buying unless these prices come down. The foreclosures I am seeing are going for the lower rates, so it will be interesting to see what happens over the next year or so.
One suggestion I will throw out is that as buyers who do not want to throw money away, we need to be patient. This market is moving very slowly, a majority of owners here were not subprime, they have these variable rate arms. A majority of which have not reset yet. When these home loans do reset, a solid percentage of the owners do go into distress and ultimately sell short or go into foreclosure. It's just not going to happen over night. Nobody in their right mind wants to show up at a home sale with a 300K loan check ready to hand over. I can understand why a lot of these folks are holding on, dropping prices slowly and hoping for the best. I'd be doing the same thing in their shoes.
things are about to get worse
I had thought I might act on a Watercolor short sale and got a pre-approval letter from bank of america, who I have always used. This was in early May and was quoted 7.5% with 0 points for 30 years and 20% down on a Jumbo. Turns out it was so tied up in the foreclosure process that not even the lender could get the process moving. So I have found another property I am interested in and got a new pre-approval letter this week. I was informed that Panama City-Destin area is now classified by BOA as a declining value market and that the rate is now 8.5% with 0 points for a 30 year JUMBO and it requires 25% down. My credit score was 748, so this is as prime as it gets. This has happened this month and has not had an effect on the housing prices, but finding a buyer may have just gotten alot harder if noone can qualify or afford a mortgage.
I had thought I might act on a Watercolor short sale and got a pre-approval letter from bank of america, who I have always used. This was in early May and was quoted 7.5% with 0 points for 30 years and 20% down on a Jumbo. Turns out it was so tied up in the foreclosure process that not even the lender could get the process moving. So I have found another property I am interested in and got a new pre-approval letter this week. I was informed that Panama City-Destin area is now classified by BOA as a declining value market and that the rate is now 8.5% with 0 points for a 30 year JUMBO and it requires 25% down. My credit score was 748, so this is as prime as it gets. This has happened this month and has not had an effect on the housing prices, but finding a buyer may have just gotten alot harder if noone can qualify or afford a mortgage.