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Real Estate News – Quick Stats for the Week of 8/31/09
Real Estate News Overview:
- New home sales rose 10% in July.
- Median sales prices of new houses sold in July was $210,000.
- In the Northeast, July’s sales rate rose 32.4% compared with June
- The South was up 16.2% compared with June
- The West was up 1% compared with June
- The Midwest’s sales rate fell 7.6% compared with June.
- The average rate for a 30-year fixed mortgage was 5.14%, up from 5.12% a week earlier.
- The average rate on a 15-year fixed-rate mortgage rose to 4.58%, from 4.56% last week.
- Rates on five-year, adjustable-rate mortgages averaged 4.67%, down from 4.57% a week earlier.
- Rates on one-year, adjustable-rate mortgages were unchanged at 4.69%.
Real Estate Investor Coach Response:
That’s all the news that I’ve got for you on this beautiful Monday morning (in Lexington, KY). Not a whole lot of explanation, just some cold hard stats to start off your week. I think it is important to at least keep a pulse on what is happening with real estate around the country and I hope this quick blog post helps you do that.
Go make some money investing in real estate!
To your Real Estate Investing Success,
Brian Evans
Real Estate News – Mortgage Problems Rise with Unemployment
Real Estate News Overview:
Homeowners continue to struggle with their mortgage payment as unemployment remains an unresolved issue in the U.S. 13% of people who own a home are behind on payments.
The outset of this mortgage debacle started as a result of the subprime loans, however the shocking statistics are that of the conventional 30 year fixed mortgage homeowners being in default as a result of rising unemployment. One in three new foreclosures between April and June was from a prime, fixed-rate loan, up from one in five a year earlier.
Real Estate Investor Coach Response:
I do my best to keep these weekly news blog posts as fresh and relevant to you as possible, however sometimes the news just repeats itself. Clearly the bottom of the market has yet to be found, however as a real estate investor, I must reiterate that I could care less what the market is doing, because I know how to make money in good times and bad. With high interest rates and low. In a recession and out. With high unemployment and low. With a liberal President and a conservative…
So why am I telling you all this, to brag? No. I am telling you this to hopefully give you something to aspire to if you are new in the business of real estate investing. If you are ready to kick your business into overdrive then perhaps it is time to get a coach (me) to keep you fatten your wallet. Check out my coaching programs at http://www.RealEstateInvestorCoach.com/Coaching
To be frank, the only time I review the news is to write you (my readers) this weekly blog post. The only news I watch throughout the week is ESPN news! Now that is news everyone should watch. And unfortunately I just found out that in the little league world series, KY (my home state) got killed on Sunday by Texas. I tell you what those young boys sure do eat their wheaties.
Sorry, I get sidetracked with two topics. Baseball and Real Estate Investing. Putting the two topics together with me kicks my ADD into overdrive!
To your Real Estate Investing Success,
Brian Evans
Real Estate News – 1 in 4 homes have lowered their prices.
Real Estate News Overview:
One in 4 US homes for sale on August 1st had their prices marked down at least once since being listed on the open market.
Watch this short video about today’s Real Estate Investing News:
Real Estate Investor Coach Response:
To think that 25% of the listed homes on the market lowered their price is very powerful information. What are you doing about it? This is a great opportunity to request seller financing, or subject to transactions. This is still very much a buyers market, and it probably won’t be for much longer. I do believe that there is still probably a year before the market begins to show any signs of a turn around. Remember real estate investing is all about the MATH! You need to be making lots and lots of offers on properties. If you are not making offers, then you are not buying properties. These properties that are lowering their prices are perfect homes to make offers on.
To find out more about what is happening in your local area I highly recommend checking out the site: www.Trulia.com
To your Real Estate Investing Success,
Brian Evans
Real Estate News – 23 Percent of Short Sale Offers Actually Close
Real Estate News Overview:
Just 23% of short-sale offers that homeowners receive from potential buyers actually close, according to a February study of 1,300 real estate agents by Campbell Communications.
Short sales once were extremely rare. But now, with unemployment climbing and home values down, more homeowners are pursuing short sales when they can’t afford their mortgage. About 11% of all sales transactions in June are such short sales, according to the NAR.
Uncompleted short sales that go to foreclosure are costlier for lenders and homeowners. For lenders, a short sale may save as much as 30% of the expense incurred by going to foreclosure.
Real Estate Investor Coach Response:
These are all very interesting facts about short sales. It is no doubt that shorts sales take a long time, and that the majority of the attempts fail. So why is this? There are multiple reasons, but lenders lack the internal staffing, expertise and systems to process these short sales in a timely fashion. They can also be very complex, especially if they involve home-equity lines of credit or other second liens held by different lenders, who also must agree to take less than the amount they’re owed from a home’s sale. But most importantly, the people who are attempting them, don’t have a clue, and aren’t prepared for the process.
Listen, if you want to make money in short sales then there is no better system out there then my Foreclosure Gold Rush System There is no better teacher out there then me. This may sound cocky or arrogant to some, but the fact of the matter is this…not only do I teach real estate, but I continue to buy and sell real estate every single day. I built my business around short sales, and am more than qualified to teach others how to do the same.
If you want to finally learn how to make big checks in real estate then you need to learn about my coaching programs . They’ll change your income and your life!
To your Real Estate Investing Success,
Brian Evans
Real Estate News – First House Prices Gain in Three Years
Real Estate News Overview:
Home prices rose 0.5% in May from April, according to the Standard & Poor’s/Case-Shiller home price index, which measures changes in the value of residential real estate in 20 cities.
After 16 consecutive months of record year-over-year price declines, beginning in October 2007 and ending in January 2009, the home price index has now shown four consecutive months of smaller annual declines.
Real Estate Investor Coach Response:
Yes, It’s true my fellow real estate investors, it looks like house prices are beginning to rise on a national scale. Please don’t take me as a pessimist, but rather a realist as we look deeper into the statistics. First of all, these statistics are only taken from 20 major cities across the United States and the numbers are averaged together. So, just because the average of these numbers shows a slight increase, it doesn’t mean that people can expect to see year over year appreciation again. Only time will tell what the future holds for the real estate market in our country. Ultimately, this is a good sign and step in the right direction.
What it really comes down to in my opinion in regards to the longevity and sustainability of the housing market are 4 primary things: (1) Consumer Confidence (2) Unemployment (3) Interest Rates and (4) Inflation. Of these three I believe Interest Rates will be the ultimate factor that can directly affect that other 3. It is frightening to know and see the way the government prints money these days and you can mark my words that eventually it will come back to bite and all of us will be effected as a result. Hopefully the government economists know something that I don’t in regards to keeping these 4 items in check.
Until next time, keep the cash flow coming in with creative investing!
To your Real Estate Investing Success,
Brian Evans
Real Estate News – Home Sales Rise but Home Prices Decline
Real Estate News Overview:
The total number of home sales increased for the third consecutive month and was a 3.6% increase from last month.
On the flip side, the average overall home price has continued to decline. Currently the median home price across the country is $181,800. This is 15.4% less than this time last year.
Real Estate Investor Coach Response:
Quite interesting information if you ask me so what does it really mean and how can we as real estate investors leverage this knowledge to grow our business?
First of all, in regards to the economy, the fact that people are buying properties is a good thing. The “herd” (my new term for the conventional wisdom people of the country) is beginning to regain their confidence and take action on real estate again. The assistance from the government and the lower interest rates from the Fed, I believe played a strong role in this new upswing, and that is a good thing (golf clap for the government and the fed)!
In regards to the flip side of this news, the stats show that home prices were clearly inflated on a national scale and the market is simply correcting itself. Ironically, the economics classes that I took in college are starting to flash in my head as I write this article. I guess some of what I learned in college has some truth to it…markets will eventually correct themselves and get back to equilibrium, until outside forces (like the media, the government, the Fed, the banks, etc) shake things up again.
Just like everything else, the real estate market fluctuates, the stock market fluctuates, there are booms and busts, and eventually everything come back to equilibrium and then the process of ups and downs repeats. History becomes reality and reality becomes history.
So, again….what should you as a real estate investor learn from this? You should learn how to make money in good times and bad. If you don’t already, make sure that you have the knowledge to invest in real estate in multiple different ways. You need to be a transaction engineer, not an all your eggs in one basket investor. The knowledge that you can and should possess as a real estate investor will carry with you from here on out. Make sure that you are implementing your knowledge and skills every day to make as much money as you possibly can.
Until next time my friends….
To your Real Estate Investing Success,
Brian Evans
Real Estate News – Modifications are Slow, Short Sales are Go
Real Estate News Overview:
Under the current administrations Modification plans, homeowners who are eligible for assistance are offered new mortgage terms, and if they agree, they enter a three-month trial phase to determine if they can keep up their reduced payments. If they stay current, the modification becomes permanent.
About 160,000 modifications are now in either the trial or the permanent stage. The rest - 165,000 - are in the offer stage. There are no numbers yet on how many modifications have successfully passed the trial phase.
Real Estate Investor Coach Response:
Back to reality my fellow readers. Loan modifications are a very optimistic approach to things, however the reality of it all is this…. Processing is slow and requires large overhead, and you can’t modify peoples loans if they don’t have a job and income to support the modification efforts.
As a real estate investor, your job is to make money based on the deals that you have to work with. Continue marketing to distressed homeowners and only do business with those that want to do business with you. Sure, some of the homeowners that you market to that are facing foreclosure will want to do a loan modification, but more than likely they will not qualify for one. If they do, good for them. If they don’t then just make sure that you are the one that they think to call when they have no other options.
Forget loan mods, and focus on short sales. The waiting time is similar yet the payouts are so much greater with short sales.
To your Real Estate Investing Success,
Brian Evans
Real Estate News – Some Quick Stats for the Week
Real Estate News Overview:
Take a look at some quick stats:
Mortgage rates dropped slightly this past week averaging about 5.32% below last weeks 5.6%.
The average rate on a 15-year fixed-rate mortgage fell to 4.77%, down from 4.87% last week.
Rates on five-year, adjustable-rate mortgages averaged 4.88%, down from 4.99% last week. Rates on one-year, adjustable-rate mortgages rose slightly to 4.94% from 4.93%.
Real Estate Investor Coach Response:
To put this into perspective, at this time last year, 30-year mortgage rates where 6.35%.
Clearly now is a better time to buy than last year for the average homeowner. With low rates and discounted properties, the combination couldn’t get much better.
As for the real estate investor…. my best advice to you is don’t fall into the trap of thinking that you have to use your own money or credit to buy and sell real estate because YOU DON’T. Not only is it a trap, but it is a bad habit. Think of it like quick sand. Investing with this mindset slowly pulls you down and sucks you in until eventually your credit it tapped, your cash flow is strapped and appreciation is your only prayer for recovery. This is not the formula for success in the game of real estate investing.
Go back and review some of my previous blog posts to learn the correct ways to make money in real estate.
To your Real Estate Investing Success,
Brian Evans
Real Estate News – Should Distressed Borrowers be Allowed to Refinance?
Real Estate News Overview:
A NEW refinancing program is now available for Homeowners that are facing foreclosure and owe 5%-25% more then what their house is worth. The government is attempting to reduce the continual rate of foreclosures by implementing refinance assistance through Fannie Mae and Freddie Mac.
Real Estate Investor Coach Response:
OK, this one confuses me a little bit… People who aren’t making their mortgage payments are going to be allowed/or considered for a refinance on their loan. I’m not a gambling man, but I would wager a guess that a good majority of the people who are allowed to refinance with this program will default again within 2 years or less.
I don’t mean to sound cruel here, but I firmly believe that at some point enough is enough and the government needs to step back and let the people of our nation deal with the consequences of their own actions. Unless a distressed borrower is a military person, elderly, or suffered from an undeniable financial hardship then this new refinancing program is not something that I agree with in regards to the spending of our tax dollars.
In my opinion, it would make more sense to allow this refinancing option for someone who is current on their payments but owes 5%-25% more then what their home is worth. These people are the ones who will keep making the payments. Why not reward the people still in good standing busting their butts to make their mortgage payment each month even though they owe more than what their home is worth?
The government should REQUIRE that borrowers take responsibility for their actions without pointing fingers and allow the defaulted loans to take their course. These homes will be foreclosed on and or purchased by investors (like us) and then resold at current market prices, hence correcting market prices the right way. Does it hurt when you rip of the band-aid quickly? Yes, for a moment but then the pain turns into relief and the wound heals naturally. Allowing most distressed borrowers to refinance is a waste of government money, time, and resources and merely puts a band-aid on the real problem and prolongs the true healing process.
Agree or disagree with me? Let others know by posting your comments below.
To your Real Estate Investing Success,
Brian Evans
Real Estate News – From $8k to $15k Tax Credit?
Real Estate News Overview:
The current tax credit is scheduled to expire in the fall however, now lawmakers and business are calling for an extension and an expansion from $8k to $15k.
In addition to this increase, the lawmaker request is also attempting to provide this incentive to anyone who buys a house, not just first time home buyers.
Buyers do not have to repay the tax credit if they occupy the home for three years or more.
Real Estate Investor Coach Response:
With the current government budget deficit a major concern to critics and myself included, I may be one to agree that this tax incentive expansion and extension would be a good “jump start” to the housing problem. Frankly, this is a pretty good incentive for anyone even considering purchasing a personal home. Clearly the original $8k incentive didn’t provide the “jump start” the government was hoping for so perhaps $15k will. Only time will tell.
Go back and review a previous blog on how some real estate investors are making money from this tax credit opportunity.
To your Real Estate Investing Success,
Brian Evans
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