Posted on 03/15/2010 11:09:12 AM PDT by Reaganesque
I've been reading in real estate news that first time home buyers are starting to buy homes again. Interest rates are still low, the First Time Home Buyer Tax Credit is still available and houses are affordable but, I'm just curious, how many Freepers are looking to buy their first home? This isn't necessarily a thread to comment on the Obama economy, I'm simply interested in buyer's current attitudes. I'm a real estate investor and I thought I would ask some real people about this.
I would imagine that a lot of military personnel would flip homes or have rental properties for extra income. Is that the case to your knowledge?
10% of 80,000 is 8,000
If it doesn't cash flow, you're not talking investment, you're talking casino bet.
I have to ask about your tag line...”Your uncle is sick but the highway is green?” Say what?! LOL!
>> You’re kidding, right? Price continue to fall and there is no trend to say they won’t continue to fall, but there ar eplenty of trends that say they will. If you are an investor, then you should know that.
That depends on the market (if you’re an investor, you should know that). Generally, prices have stabilized. In some markets, prices continue to plummet, and in others (particularly in the South), prices have risen some.
I was speaking generally. For the record, I wouldn’t invest in Detroit at this moment ... Tennessee, Texas, Georgia, Flordia, etc. have some good buys, though.
SnakeDoc
>> I would not be so sure what remnants of capitalism we will have left once the Democrats’ program is fully in place.
That their current powerplay will likely cost most of them their jobs is reason for hope.
A lesser nation would (as many lesser nations have) invite this debacle with open arms. We may not be on the right track at the moment ... but the general unpopularity of this bill indiciates the American mindset is both correct, and unique in the world. It is that unique mindset which made us what we are, and which will deliver us from what we face.
SnakeDoc
You have FReepmail.
I know one or two with rentals but not many. Military types move around too much to manage rentals.
Thanks for your advice. It sounds reasonable to me. I have returned to college full time and I anticipate graduation next year, at that point I will have to assess my situation. The only down side is that the house is very old and a termite city, so there will be extensive improvemrnt costs afterwards. But hopefully I will be employed full time by them.
OK. Thanks!
It’s not only a classic “model”...I did it myself...sort of.
I lived in 1/2 of a duplex l0 months that was listed for sale/lease at $425K. 2 months before my lease expired, out of the blue, the owner offered me the place for $300K, no bargaining. She owned it outright and offered to finance the thing 15 yrs @ 7% (quite decent at the time, 1995) if I put 10% down. I wrote her a $30K check and starting making payments, shazam, the easiest RE deal of all time. The escrow people were absolutely furious at me because they made almost nothing on the deal.
You don’t by the way have to wait for the owner to kick; at least to start the idea wheels turning. Although, should he sell now he could be subject to a giant capital gain that is in most cases better handled by transferring the stepped-up basis to the heirs.
Still, strategically, you may want to start thinking about laying the groundwork for the deal now. It’s entirely a matter of the relationship you’ve developed with the current owner. *ANY* California RE deal *MUST* go thru termite inspection, even the most “as-is” of “as-is”, which itself is semi-meaningless in CA. Nevertheless, that could be a $4K-$20K affair the heirs will have to deal with off in the future, and it will be real money they have to spend. If you’ve been timely with your rent for a few years and place has some deferred mtce, those are things in your favor. They key is for you to put yourself in the place of the heirs, trying to sell a property which they have no attachment to, but which they will have to pay perhaps $20K-$25K each to sell. (assuming 3 heirs, $50K sales commish, $15K termites, $10K misc selling expenses) Yes, they got the property for free so in one sense it doesn’t “cost” them to pay those fees, (though they will have to advance termites & fixup) but you’re offering to deliver a 5 or 6% coupon to them they cannot ordinarily get.
My suggestion is to spend some time pondering this, I repeat, it is a classic situation than usually can be worked out into a very easy deal to everyone’s benefit without undue effort.
So much the better. It will remain the money machine it is now for them should you construct a deal where they continue to receive payments over a long period of time. Without them having to pay the prop taxes nor do the mtce which, it sounds like they have an unpleasant appointment with in the future. See if you can develop a non-aggressive dialog with the heirs. You’re not necessarily looking to steal the place. But you can avoid conventional financing origination fees and they can avoid a fat RE commish if the fundamental interest is there. If they have cashed out of other properties, they already know there is a challenge to achieve yield on the proceeds.
True. Their kids live out of state but I’m sure I’ll have the opportunity to talk with one of them at some point. My wife and I know that the house is out of code and it would be an inspector’s nightmare. To be honest, the property it sits on is worth more than the house. It is a double lot on the corner of a busy street. One can even demolish it and put in three new houses; but I’m sure it’s crossed the minds of the kids. But I’ll just have to wait and see.
I’d like to, and started looking into it, but don’t have enough of a down payment to qualify for financing.
Google "43 Man Squamish"
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.