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This is really a question I'd like to ask other agents but anyone that has an opinion, feel free to add.
Being you have first hand knowledge of what's on the market and obviously prices have been reduced, well now the rates have gone down, are you investing? I moved, bought a house in January, started in real estate in February and since then have not made a lot of money. The market has been tough and I moved to an area that I don't really know anyone, so it's been a slow start. My SO has been paying most of the bills but we both still have some money in the bank. I was thinking if we are going to invest, now's the time except I don't know if I can get a mortgage. We have excellent credit, not a lot of debt, except our current mortgage but on paper not a lot of steady income. My idea is to buy a property (or more) and rent them out until the market changes and flip them. I realize there is a risk of not being able to rent or problems with renters but at least we have money in the bank to fall back on. That's why I was considering 100% financing but not sure if I can get that. My other idea is to wait a little while and look for houses that need a little work, we can do the work ourselves and flip them. Problem with that is we would need to wait until the market starts to change a bit and I don't see that happening anytime soon. There is so much inventory in this area, so I think it would be better to buy and rent, sit on it and sell at a later date.
Is anyone else doing this? What would you suggest?
People who were flippinng houses are part of the current home loan problem IMO. From what I've seen quite a few were subprime loans and now the banks are going to eat them. I wouldn't say investing in real estate is bad at almost anytime but there is a difference between investing and flipping. If you want to invest in a house and rent it, sure probably not a bad thing. If your looking to flip and make a fast buck, unless you are incredibly lucky finding a property, that ship has sailed and won't be back for a while. I would highly doubt you would be able to get financing at this point anyway.
Getting approved for a 100% mortgage on an investment property without being able to verify income will be close to impossible as of today.
Real Estate is very local in nature so only a specialist in your area would be able to help you. Just make sure you find a trustworthy and truthful professional and ask for raw numbers and proof of anything they say so you can judge for yourself.
I know in my market, buying an investment property without it being an AMAZING deal would not be the best move.
Investing in Real Estate is not a bad thing if you have the long term vision, patience and work with a team of professionals that understand your goals. There are several markets that are still doing very well and in the down markets many investors are going to picking those properties up and doing what they do best.
When it comes to investing, it's all about location, location, location. Seriously, though, there is so much inventory right now and not every part of the country is going to recover as quickly as others. In fact, in many parts of the country where jobs are on the decline and population growth is on the decline, housing prices have suffered huge declines. I would expect that many people in those areas will end up just walking away from their homes, and some areas of the country may even become blighted for a while. On the other hand, a shift in population to where the jobs are, or where there's great weather, or something else that's special about a particular city/town, then those areas will recover more quickly and real estate investments in those areas could be lucrative.
I would venture to guess that the tightening of mortgage requirements coupled with the housing downturn will result in a return to people buying only one home, and staying in it for a longer period of time, perhaps fixing it up rather than moving up the housing ladder within 3 - 5 years. People who can afford to will probably invest in a vacation home for a longer duration, too. However I really see the days of investing in real estate as a commodity as over (at least for quite a while) in many parts of the country.
Very good point Gretchen B,it's all about location,location,location.
Buying residential is not a good idea, but buying for investment is great,I have several buyers in the past that are coming out to buy investment.
Some sell their sfr and buy investment,stay in one unit and stay there until the market turns around.
It's the Myrtle Beach area, so location is great. There has been an influx of people moving here over the last couple years and it seems that's going to continue. Where I was thinking of buying is a very popular area and the house prices have been dropping $10,000, $20,000 & $30,000 at a time, due to the large inventory. I realize I would have to sit on it for awhile but hopefully I could get renters, so research would have to be done. I agree and don't think now is the time to flip but I don't want to miss an opportunity to buy low and sell high. Are there any other agents doing this?
The Myrtle Beach area is a place that you could make some money. I'm just south of you in Charleston. The market has slowed for our area and prices are declining. I'm not sure how far they will go. However, for a longer term investment, the coast of South Carolina is one of the areas where people are moving in large numbers.
Not sure where you are, but a person would have to be brain damaged to buy investment property here right now. And there are TONS of vacant rentals.
Well I am somewhere near you, Evey, and there are very good deals for investors.
You can find 2 bedroom 2 bath CB homes in the $75,000 range here.
Your PITI on this would be around $650 and rents in the area for this size go around $750.
The smaller, lower end rentals are in higher demand so it is not too much problem keeping them full.
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Seriously, though, there is so much inventory right now and not every part of the country is going to recover as quickly as others. In fact, in many parts of the country where jobs are on the decline and population growth is on the decline, housing prices have suffered huge declines. I would expect that many people in those areas will end up just walking away from their homes, and some areas of the country may even become blighted for a while. On the other hand, a shift in population to where the jobs are, or where there's great weather, or something else that's special about a particular city/town, then those areas will recover more quickly and real estate investments in those areas could be lucrative.
