Problems with outside investors? (Dallas, Rowlett: for sale, foreclosures, rental homes)

[bdlee73]

Currently I live in Boise and one of the reasons I'm looking at moving to Dallas is that our housing market was ruined by outside "investors" who bought up many of the new homes. Without using a "toxic" mortage, buying a home in Boise now would be a challenge. I've heard of some investor activity in Texas, more specifically around the hill country, but what about Dallas? If we buy in the area, I don't want to be caught up in inflated prices caused by speculation that could go bust (1980s all over again?) I've heard that forclosures are up in the area and that's a little scary. Thanks for any observations you can provide.

[momof2dfw]

Few. We had the old savings & loan scandal back in the day and the banks around here are pretty harsh on some things. There is some guy right now that is in trouble in Frisco. Some townhomes he bought under someone elses name and they resale them for a highly inflated price to another person telling them they will sell before the ink even dries on the contract. Got caught and now in trouble (it was in the Dallas Morning News recently, dallas news.com). We also had some morons going around trying to buy peoples good credit to buy homes to "lease" to sell to people that had bad credit. So the "broker" would come to you w/ a great credit score for you to buy this property and he has a buyer lined up but they have a bad credit history so you will be toting the note basically. Sure. NOT!!! Since our market does not see the HUGE gains that are very drastic like other states it is not really a big investor area. Even for rentals. Some have tried to do that but everyone that I know that has and has had rental homes wants out and are selling them when they become empty. The cities have put some pretty tight code enforcement on rental properties. Like where I live the owner/landlord must file the property w/ the city. The city then has the right to come at anytime and inspect the property and they will schedule an appointment to inspect the interior of the property.

As for the amount of foreclosures. If you look closely at the homes that are foreclosed on you can see that you will have a few sprinkled around that are in areas that a good property sells. Then you will have areas that have a heavy concentration of foreclosures. I'll tell you one neighborhood right off and it has had this problem for several years, Waterview in Rowlett. It is supposed to be "IT" but it is a dump (well, next to one). So what if they have some big nice waterpark for the residents, the place is awful. Too many people trying to live WAY beyond their means, lots of foreclosures and homes sitting (new homes) rotting for sale for years. Usually new or newer subdivisions that tend to attract those that want more square footage no matter the quality of the home. Like the other day I looked at some properties online that another poster thought were "luxury" and very cheap and affordable new homes in Dallas. Sure, they are "cheap" but there are WAY TOO MANY for sale in the neighborhoods they were looking at that it gave off a huge red flag. I pulled up some of the streets on the county tax office and sure enough a lot of them were owned by the bank - foreclosure.

So if you find a place or area you like drive around the neighborhoods and see how many are for sale. Get the street names and look them up to see if an overwhelming majority of them are foreclosures (different than a relo but it is pretty easy to tell as the foreclosure usually has "bank" or "mtg" in the owners name). Are there a lot on the market that have been on the market for a VERY long time or are they selling pretty quick. Ask your realtor for comps in the area and this will let you know what homes in the area have sold and for how much and how long they were on the market. Like I said, good homes, in a good area, priced right will sell. I know in my area that is totally the case. Some have sat that are priced at what I believe is way too low while others have sold for top dollar per sq foot.