Indeed...even seeing REO's drop to ~$.50 after a few price drops because they've been sitting around too long. Some still a little too high though, unless you're buying to keep as a homeowner...in which case it can be just getting a nice deal. (also in the NE) Definitely depends on your area....I've seen wholesalers killing it in the mid-sized citites because of how depressed many have become getting properties for an easy $/30-$.40 on the dollar range. I'm looking at a REO later today that's sitting around $.50 after dropping 3 times in the past 3 months....just came across my desk though. Of course I'll offer lower to start, but the description claims only some TLC/cosmetic work needed. If so, even at $.50 it's a good deal that feasibly could be turned @ a small profit. Regular properties though that the "average" homeowner is trying to sell STILL are priced well above "assessment value." Good luck maybe getting it to go in 4-6 months time!
===================== Agreed; less than that in Detroit. Real estate really depends on the location Real estate is not like Citigroup stock , where ever you sell/buy the stock, its the same; a 210 or 2100 sq foot house is not like that at all.
I own a lot of multi-family stuff (all buildings contain 5 or more units) in suburban philadelphia, and I can assure you that demand for apartments is strong as are the rents. Single family housing may be a different story, but multi-family is doing very well.
IMHO, toughest part of this whole nut here is the timing (like most things). We all know its cheap(er) and that properties can be picked up for $.50 or so. However, when's the best time to buy, as whatever you buy you are going to be owning for the next 5 years at a minimum in all probablility. Anecdotally, first wave of dumb money came in in Jan 2007 where they bought at a 10-15% discount off peak. Second wave of money is now coming in and purchasing bank owned and foreclosed properties at good discounts. However, those purchases imply cash burn, which is going to reduce future purchasing support (once you have bought, that's it, even if you need to pass on sweeter deals). New admin's actions seem to indicate that they expect things to be poor through 2010 at least. So why the hurry to buy? Personally, I'm waiting for tax sales which take a while to filter through the market. There and absolute foreclosure auctions seem to be where the opportunity is. I say wait until these 2nd wave deals are done. Then the time to purchase may be after June of this year through next year. Anyone want to refute my thesis and tell me why I should buy NOW?
I am not going to be using MY cash to buy. The rate you can get right now might not be the same rate you can get in 2010. Depending on the type of property you are buying this could have a big effect on if you should purchase.
50c on the dollar based on what? The previous sale price/value? Someone bought Nasdaq at 5000. Someone also bought Nasdaq at 2500. Someone will buy Nasdaq at 800 too! And before I forget: between here and there will be some currency "manipulation" Nasdaq 1800 becomes the old Nasdaq 1200. Let the re-inflation begin! 50c on the dollar means nothing unless you are prepared to own that house 'til death do you part. Seeing previous highs in RE is nothing but a dream. Conventional thinking spear-catching at it's finest. Once unthinkable, now unstoppable obama-lama
both... $.50 on "assessed value." $.50 on the lowest, or relatively lowest comps in the area. Of course #2 is where you want to be...the lower the better! Others though are way too high with the mortgage that is on it...so better to wait and let the bank put it on the market. But with multi's, bottom line is it needs to cash flow and cash flow well through renting...singles, low enough with rehabs that it's cheap enough to turn.