Is the housing market in a state of recovery? That is the one billion dollar question that everyone wants an answer to. There are some signs that could point to an improvement in the real estate market, but it may be too early to determine what is really going on.
One of the most obvious ways to gauge what is going on in the real estate market is to watch the current home sales. There are dozens of factors that can help pinpoint exactly what is happening. The amount of time that a home sits on the market is just one way to measure the real estate market. It helps to indicate how quickly houses are selling.
There is another industry sign that a lot of real estate investors are looking at today, and that is the amount of foreclosures that are currently on the market. This is one excellent way to determine if the housing market and the overall economy is going to start improving.
The good news is this. It appears that the amount of foreclosure properties on the market has slowed down, but does this mean that things are going to be getting back to normal anytime soon? It can be hard to tell from just foreclosures.
There were several markets that were hit harder than others with foreclosures. These markets are the ones to watch. Most of these real estate markets are starting to show good signs of improvement. When the real estate markets that were hit the hardest start showing signs of improvement, then it could be a sign that even better things are coming.
There still may be plenty of homes on the market that are just waiting for the foreclosure process to happen. The lack of foreclosures is a really good sign, but real estate investors are not 100% certain that the real estate market is making a turn for the better.
Many homes that should be in foreclosure are currently protected by law. There may be a flood of foreclosure properties suddenly appearing on the market if all of these homes that are being protected end up in the foreclosure process at the same time.
At any given time there could be as many as 5000 homes in one local market. Half of these homes are in some sort of trouble, but there could be even more in the future. It does not look like the housing market is out of the woods quite yet, but there is definitely a light at the end of the tunnel for homeowners and real estate investors.
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May 25th, 2012
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One of the most popular methods of getting some literal foot traffic into a home is by offering a open house. It gives people an open invitation to browse the property. It gives them a chance to try things out before they decide to make a commitment, but do open houses really work, or do they just create more work for the real estate agent and the homeowner?
What would be considered a good conversion rate for an open house? An excellent conversion rate would be upwards of 50%, but open house conversions don’t quite stand up to those numbers. If you are planning an open house, then this article is not meant to burst your bubble, but less than two percent of all open houses convert into a sale that was a direct result of the open house. That is not a very good conversion.
What is the problem?
A lot of people that come to open houses never have any intentions of buying the property. An open house can be a great way to socialize and take advantage of free food and drinks. You may not think that people do this, but they do.
There are plenty of other reasons that open houses never convert. There could be poor communication between the real estate agent and the interested home buyers. People don’t always buy something the very first time that they see it. It may take weeks or months of follow ups to convince them that a purchase is the right choice. Is the real estate agent following up with all of the prospects? It can be difficult to follow up with everyone that attended the open house, but if the real estate agent knows what they are doing, then they should not have any problems following up.
Following up is also much more than a simple phone call, email or thank you. Over 40% of all real estate agents never follow up at all. That is why open houses are not converting as well as they should be. The other 60% will follow up with a simple thank you phone call or email. That is great, and the prospective home buyers will appreciate that, but it is not enough to convert them into a sale. This is where almost 100% of all real estate agents stop, but they need to continue with those follow ups in order to convert a curious home buyer into a sign on the dotted line home buyer.
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May 22nd, 2012
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At one time the real estate market in the United States was the cream of the crop. It has definitely seen its better days, but underneath all of the gloom and doom of the housing market, there are still people buying up properties quickly. Most of these purchases are coming from out of the country. Many American citizens have stayed away from the market. It is proving to be too much of a risk for them, but for some real estate investors that don’t live in the United States, the market looks good. They are taking advantage of the lower than usual prices, and they are snatching up properties left and right.
Which real estate markets in the United States are seeing the most action. Unfortunately the out of country real estate boom is not all over the country. It seems to be taking place in certain areas. What areas are appealing to these foreign home buyers? If you put a map of the United States on a dart board and started throwing darts at it, you may never even hit the hot spots. However, there is one state that sticks out like a sore thumb, literally.
Florida seems to be the state that has the most interest. Out of the top ten cities, Florida contains six of them. What is the attraction in Florida? Could it be the coastlines that surround the state, or could it be that the foreign real estate investors are trying to make a buck or two on Florida’s popular tourist industry.
Recent statistics have shown that Orlando, Florida is the number one tourist destination in the world, but it is not the most popular place for foreign real estate investors to put their money. It comes in number three on the list.
The number one place that foreign real estate investors are sinking their money is the city of Lakeland Florida. This city has seen tremendous growth recently, and it is just a few short miles from Orlando. Real estate prices in Lakeland are much cheaper than they are in Orlando, that could be the reason why it has become a hot spot for foreign investors.
Do these foreign real estate investors have some insider information? Have they found the best place to invest in real estate? If the statistics are right, then it looks like they may have found the best kept real estate investing secret.
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May 19th, 2012
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Just when you thought it was safe to jump back into the real estate market, reports are showing that more than 50% of all real estate markets have seen a dramatic increase in foreclosure filings. This happened during the first three months of 2012. It could just be the final push to get them all filed, but depending on where you are in the real estate market this could be good or bad news to you.
Analysts were certain that the foreclosures had somewhat slowed down, but it appears as if there were quite a few foreclosure properties that were hiding in the shadows.
For people that own the homes that have recently received foreclosure filings, it is not very good news. For savvy real estate investors this is a completely different story. These properties that have recently gone into foreclosure could be great additions to a real estate portfolio. Real estate investors might be able to pick up these properties at auction. The good part for these savvy real estate investors will be the lower price that only a foreclosure auction can bring. Foreclosure home auctions can be a great way to buy some additional properties for a much lower price.
Once the real estate investor adds the property to their portfolio, they may need to also provide a little tender loving care to the property. A lot of homes that have gone through foreclosure are not in the best shape, but being able to purchase these homes at a much lower price still leaves plenty of budget room for some massive improvements. Once the improvements are made, the real estate investor may be able to turn around and sell the property for a sizable profit, but the smarter real estate investor will sit on the property and wait for the market to grow.
In a ten year period the real estate market could easily double or even triple in growth, and with it so will all of the properties. Once the real estate market is at its peak, the real estate investor can sell the property for an even larger profit than if they had chosen to sell it immediately.
While they are waiting for the market o increase, the real estate investors can always rent out the properties and still make a profit. One thing is for certain, these properties will not sit abandoned like they have in the past.
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May 17th, 2012
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If you own one or more properties, and you are thinking about renting these properties, you may need to do some tenant screening. For those of you that are new to the whole rental process, this article will help explain exactly what tenant screening is, and whether or not you should be doing it.
Should I be screening my rental tenants?
This is a rather silly question to be asking yourself. You should most definitely be doing some sort of tenant screening. If you are not, then you are not protecting yourself, or your property. The idea of offering a home for rent is a great idea. It is an even better way to make some truly passive income, but you must protect your investment, and your property is your investment.
There are some people out there, some renters who are looking to take advantage of people that are offering homes for rent. These people are very smart, and they are even sneakier. They know exactly what they are doing, and they are out for nothing more than a free ride. If you are not screening your rental applicants, then you could be allowing one of these modern con artists into your home where they can cause massive damage and at the same time, manage to avoid paying you one red cent.
How can you screen your rental tenants?
The first thing that you should do is get all of the important information before you let them move in. This information will help you determine if your possible renter is nothing more than a scammer trying to take advantage of you.
You should have a solid rental application that covers all of these possible problems. You should at minimum be asking for a name, place of employment, living history, and some personal references. This is where the smarter scammers can pull the wool over your eyes by providing you with false information that will pass all of your screenings.
As a property owner you will be responsible for following up with your rental application and actually checking that everything is what it appears to be. Verifying all of the information on the rental application is as simple as making a phone call and asking a few questions. Don’t be shy. This is your property. You need to make sure that it is protected. If anything seems a little fishy, explore it further, but never ignore it.
Pre-screening your tenants is a must if you are offering your properties for rent.
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May 15th, 2012
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So you are thinking about getting into the rental game. Buying properties and then renting them out can be an excellent way to make a good bit of money, but everything has a dark side, even being a landlord. It may sound like roses on the outside, but there are still plenty of pitfalls that you are going to have to keep your eyes open for.
The very first thing that you are going to need is money. Without any money you can’t possibly purchase any type of property. Properties are not cheap. There is a really good chance that you will not have enough money in your piggy bank to purchase a house, so what do you do? You have to turn to a bank. You will need a loan, which means that you will need financing. It all sounds pretty easy, but if you do not have all of your ducks in a row, no bank will give you the financing that you need to purchase a house.
Getting the financing that you need is much more difficult today than it was just ten years ago. Banks are not approving loans as easy as they used to, but if your credit looks good, and you are earning a pretty good income, then you will not have any problems getting the financing that you need to purchase a rental home.
There are two basic types of loans for rental properties. The first type is called a Non Owner Occupant. This is when you own the house, but don’t actually live on the property. This type of loan is much more difficult to get. The other type of loan is called a Owner Occupant. In this case you will be required to live in the house for a certain amount of time before you can start renting out the property. This time period is usually only 12 months. Living somewhere for 12 months is not that difficult, and if that is what you need to do to get started with rental properties, then by all means, do it.
Being an Owner Occupant will make getting a home loan much easier. You will be able to get much better financing and you will also be able to get a much lower interest rate.
Understanding your financing options will make it much easier to get financed for your rental properties.
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May 13th, 2012
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There are several key signs that always point to a very healthy real estate market. Knowing what these signs are can really help anyone that is interested in what the real estate market has to offer. You could be a first time home buyer, or you could be a seasoned real estate investor. The simple fact is this. Everyone benefits from a prosperous real estate market.
So what are some of these magical signs that point to a healthy or growing real estate market?
The first good sign is less houses on the market. If there are a lot of homes for sale it can quickly flood the market. Everything will then become diluted and worth less. The real estate market is your typical supply and demand market. Both the supply and the demand have to be equal in order for the market to thrive and prosper. When there are too many houses listed, then the market becomes over saturated, and many homes either won’t sell at all, or they will sit on the market for a very long time. Having less homes on the market is a good sign. It means that the demand is keeping up with the supply. People are buying homes.
Another great sign that goes right along with fewer houses on the market is a nice fresh inventory of homes for sale. People and real estate investors get tired of looking at all of the same houses all of the time. When houses sit on the market for months at a time it is not a good sign. A new and fresh homes for sale inventory shows that homes are being sold. This is always good news.
Prices also have a huge affect on the current market. When all of the home prices are too high it can create a saturated market. The prices need to be good to keep the buyers doing what they do best, buying. If the prices on all of the homes are too low, then there may not be enough properties to meet the demand. It all goes back to that supply and demand scenario. When the average list price on homes slowly starts to increase, it means that the housing market is doing better. The average price must rise slowly. If it does rise too fast, then it will force people to stop buying which can lead to a saturated housing market. Everything needs to be perfectly balanced. That is why we see so many housing market fluctuations throughout the years.
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May 11th, 2012
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There are some areas of the country that are seeing much better real estate sales. This is partly due to smaller for sale inventory. A larger inventory of homes for sale can really make it difficult to find a home, and the longer that a home sits on the market, the harder it becomes to sell, and it is not just homes either. Condominiums, apartments, town homes and any other type of property that you can think of all fall into the same real estate market pool. When there are too many choices, the market suffers. When there are fewer choices, the market will grow. Here are a few markets where the for sale inventory has dropped. These may be the best markets to buy a home.
Oakland, California has seen the largest drop in for sale inventory. The homes for sale inventory in Oakland is just under 52% lower. The city of Oakland has a population of just under 400,000 people. That could quickly change when people start seeing how well the housing market is growing there.
There is more than one place in California that saw such a huge drop in for sale inventory. Bakersfield, California has also seen a very dramatic drop in for sale inventory. With a drop of just over 50%, the Bakersfield housing market is looking up.
If you like the idea of nights full of stars and some of the best painted sunrises and sunsets then set your sights on Phoenix, Arizona. The housing market in Phoenix is also showing some great signs of growth. The for sale inventory in this city has dropped 48%. Fewer homes for sale mean that more people are buying, and less people are selling.
As if the two cities in California were not enough, a third city is also showing some great signs of improvement. The for sale inventory has dropped about 45% in the last year, and the average price for homes for sale in Fresno is $159,500.
One of the hottest spots in the United States is also showing massive improvements. This city is not hot from heat because it has the cool waters of the Atlantic ocean on one side. This city is hot because of its popularity. Can you guess which city this is? If you guessed Miami then you are right. The for sale inventory in Miami has dropped around 42% This is making the town of Miami even hotter.
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May 8th, 2012
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The whole concept of buying and selling a home is exactly like match making. It takes a perfect match of buyer and seller to complete the deal. Making this perfect match is the key, and that is where the similarities of match making and real estate are exactly the same. You have to find two like minded people who are interested in the same things. The buyer should have something that the seller wants, and the seller should have something that the buyer wants. When the two meet, there is a match, and there is a successful transaction. This is how real estate transactions should work, but just like dating, it can be very difficult to have a successful match.
In the real estate market, who is the match maker? It can be anyone. It could be the person that is selling the house. It could be the person that is buying the house. It could even be the home inspector. Most of the times the real estate match maker is the real estate agent. That is their job. It is what they do for a living.
If you are buying a home, then you need the best match maker on your side. You need a real estate agent that has been established for quite some time. A seasoned real estate agent should have a huge mailing list of prospective clients. This list is where the match making begins. The real estate agent will know exactly what customers are looking for and they will be able to pair your home with a home buyer. That is how real estate match making should work.
People that are selling their homes are not the only ones that can benefit from a little bit of real estate match making either. If you are selling your home then having a real estate agent on your side can be a huge advantage. The real estate agent will have connections, and it could be as quick as just a few days before your house sells with the help of a real estate agent. Again, this is how real estate match making should work.
With today’s technology real estate match making happens even faster. Web sites are helping people make the match that they deserve. There has never been a better way to pair up a home buyer with someone that is selling a piece of property.
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May 6th, 2012
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There is a child’s story, a nursery rhyme if you will, where a chicken named Chicken Little runs around exclaiming, “The sky is falling! The sky is falling!” This caused plenty of unneeded panic. Today there is a better announcement for chicken little. That chicken should be saying this. “Mortgage rates are falling! Mortgage rates are falling!” It is true, they are falling, and now is a great time to take advantage of these falling rates.
Lower mortgage rates don’t always mean that it is time to purchase a new house. People that currently own property can also benefit from lower mortgage rates. Lower mortgage rates are also an excellent time to lower your existing rates. You can refinance your home and enjoy some significant savings, and the savings can be felt for years to come. Take a closer look at how you can benefit from the lower rates by refinancing your existing mortgage loan.
In the example, let’s say that your mortgage payment is an even $800.00 per month. Let’s say that taking advantage of the lower rates and refinancing allows you to lower your monthly mortgage payment to $600.00. $200.00 a month may not seem like a lot of money at first, but let’s start adding it up. In year you would have saved $2400.00. Now that is starting to sound like some significant savings. Now take that years worth of savings and apply it to rest of your mortgage. Let’s say that you have ten years left on your mortgage. You would have saved $24,000! That $200.00 a month sure does add up over time.
Now is a great time to take full advantage of the lower mortgage rates. If you don’t act now, you may regret it because the falling mortgage rates can easily start to rise again.
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May 4th, 2012
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