I received this email as I am signed up to various sites to track realty prices. It’s good for laugh if nothing else.
Real Estate Trends for 2011
The time is now for qualified homebuyers to start looking for their dream home. Low house prices combined with low mortgage rates make 2011 the perfect time to purchase a home.
Really. It’s the perfect time to jump in now and lose 10-20% of you equity by this time next year. Where do I sign up for this deal?
*Buyers get what they want. Experts from the Urban Land Institute predict that homeowners will continue to buy smaller, more energy-efficient houses. Since people are looking at first homes as a ten-year commitment instead of the previous five-year, they are less likely to settle for a property that's less than ideal.
Translation: People are broke so they will by a broken down shack.
And who the hell are the Urban Land Institute? Did they replace the Urban council on made up statistics?
*Sellers, attention to detail and competitive pricing is key. With plenty of houses on the market, homeowners trying to sell their property will have to keep prices competitive. All small repairs should be completed on the home because potential homebuyers will have many houses to choose from in their price range and will be looking at details sometimes overlooked in the past.
Yup, with a shadow inventory that translates into almost a years supply we can look forward to years of broken down homes. So when you are competing with the foreclosure next door, you know the one with the broken windows and missing pipes making sure there isn’t a scuff on your wall is important.
*Qualified buyers come out ahead. Mortgage rates are still low and are expected to remain in the five percent range for the upcoming year. Mortgage lenders have tightened their lending policies, but qualified buyers who have good credit will be able to secure a mortgage at a low percentage rate. Lenders expect that borrowers will have a down payment and have a debt to income ratio that ranges from about 30-45 percent.
This is terrific news. I was worried the Ben was losing control of interest rates. So there are middle class people out there that are not getting raped by inflation and taxes with good scores and the banks are lending again? Sweet.
*Demand for new homes may increase. Forbes predicts that by the end of 2011, there will be a need for new houses because current building trends are not keeping up with population demands. This could eventually lead to a shortage of housing at some point in the future. Buyers interested in purchasing a new home may find prices that are higher than expected if building continues to be slow.
Forbes? Jack Forbes? A good guy but he is mildly retarded. Oh, the magazine? They went full retard a long time ago. Yeah, take investment advice from the guys who didn’t see the bubble in anything.
*Cash is king. Investors who can buy property with cash are at a huge advantage this year. Prices are already low, but sellers may be willing to accept an even lower cash offer to avoid having to deal with lending institutions.
Cash is King. Now there is a pearl of wisdom. Where have I heard that before? “Sellers may be willing to take a lower price for cash,” Really, wow that’s good to know.
The material in this publication is provided for your informational purpose only and is not intended to substitute professional advice. If your property is currently listed with a Real Estate Broker, this publication is not intended as a solicitation.
This material is the same material we send out every couple of months in the hope that someone, anyone will please buy something otherwise we can’t make our own mortgage payments.
Here is a simple rule of thumb for real estate:
1. Take the full price of what you are willing to pay for the house and figure out the mortgage as if it was no money down. Say it’s $1000 a month. Now add taxes, insurance, repairs and water (in some states you cannot charge for water usage as a landlord)
We are now at $1200 per month
2. Now assume you will rent the property for 8 months of the year. Can you get positive cash flow out of that scenario? Will the rent in that neighborhood support the mortgage payments etc?
$1200 x 12= $14,400 / 8= $1800. Can you charge that much in the neighborhood?
3. If the answer is no then you haven’t made an investment. You have bought into a Ponzi inflation scheme in the hope that there is greater fool who will come along and allow you to get your money back.