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Real Estate Investors - Red Alert
How's the real estate marketing doing? Is the huge jump in home prices that is evident in some areas symptoms of a value bubble? Good questions, yes?
Two things to keep in mind when surveying the market:
1. All real estate is local, 2. Real estate is cyclical.
Here in Arizona some residential areas have seen as much as a 30% jump in value in the last 8 to 12 months. The word about increasing Arizona home values has spread across the country. We recently sold a home to an out of state buyer who never looked at the property. His agent is just buying homes, because the buyer is sure prices will continue to escalate.
In the case of another of our houses a buyer offered $2,000 above our asking price on the day we posted a for sale sign on the property. We were asking more than we expected to get!
At the same time we received a telephone call from a relative living in California. He was very excited because his brother-in-law was sure he would get rich by buying a couple of Arizona homes. Should her do the same, he asked?
Such events have all the earmarks of a price bubble... if only in Arizona. On the other hand...
On a recent trip to Buffalo, New York, the local newspaper ran a story explaining that home sales were up. In the same article it revealed that the median price of a home had dropped. In other words, people are hurrying to buy homes that are dropping value. There's more...
Mortgage Banker's Association data shows that adjustable-rate and interest-only mortgages accounted for nearly two-thirds of mortgage originations in the second half of last year.
Loans of that type help push up housing prices, because they carry lower initial monthly payments, enabling borrowers to purchase more expensive homes. Basic economics... if more people can buy homes there is more demand... More demand means higher prices.
The rise of interest-only loans, coupled with acceptable higher debt levels for borrowers and tightened bankruptcy laws will probably soon lead to an increase in foreclosures.
If you are buying a home with an interest only loan and the value of that home drops... it is very easy for the borrower to just walk away from the payments. After all, they've built no equity in the property.
Both the Clinton and Bush administrations have pushed a policy of low interest rates and easy mortgage loan qualifying. If every voter has a home they are happy and will vote for the party in power seems to be the limit of political thought.
The truth may be that the government is setting people up for failure and financial pain. Far to many people are buying homes they really can't afford. When interest rates rise... as they surely will... all those adjustable rate loans will act like debt-traps. Interest rates will go up while wages remain stagnate. The result? More foreclosures and financial ruin for many.
There are international forces at work that will not continue to support our government's wild spending habits by buying its low interest bonds. Interest rates must rise. sooner or later?
Bubble or normal cycle... it makes little difference. If you are an investor consider selling some of your properties to raise cash for the awesome opportunities ahead. You know, buy low - sell high.
In our opinion, there is still profit opportunity if you buy at least 30% below current market value... with owner financing.
Prepare now for the coming wave of preforeclosure opportunity. We recommend the guide to preforeclosure profits you will find here http://digbig.com/4dmff
About The Author: Mark Walters is an investor-entrepreneur helping other investors from his Web pages at http://www.Lease-Option-Sub2.com
Lake Property in Danbury
A lakeside vacation or second home can be a quiet and relaxing place to escape to, or simply a good investment in your financial future. Whether you enjoy the outdoor activities and recreation provided by one of Connecticut's beautiful lakes, or you just want a place to get away from it all, there is a lakeside home for you in Danbury.
Small Town Stone House with a Long History
As a native Midwesterner, the first thing I noticed when moving to the Delaware Valley was the enormous number of fieldstone houses. Frankly, I'd never seen such a thing.
Selling Your Own Home: 10 More Tips
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Buy to Let Property Investment
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Unravelling The Real Estate Buying Process in Canada
If you're a foreign national thinking about investing in the real estate market in Canada here's a run down of the typical buying process you should expect to encounter together with a general explanation of mortgages available to assist with the purchase.First things first though, you have to find your ideal property of course!But let's assume you've done that with the help of a good estate agent and you're ready to move forward with an offer.
Lock In Big Profits By Offering Rent To Own Deals
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Dont Buy Ugly Houses!
Ugly houses can be great investments, but we don't buy them. We understand that there are lots of valid ways to make money investing in real estate.
Home Owner Association Restrictions - Read Before Buying
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Real Estate Investing with Bad Credit!
By being creative, you can play the game of real estate investing by using what is called Option's investing.This is just one technique of the Option's strategy of investing but can be a power tool in your investors toolbox to help you control more real estate and build wealth.
How to Achieve Financial Freedom with Your Home
The secret disclosed on how you too could achieve financial freedom through property (and tell the pension companies just where to stick their measly, worthless 'pensions') Geoff Morris is a self-made property millionaire who made it in less than 18 months even with a hectic 'day job'. He has written a series of articles to help people like you achieve the same levels of success - as long as you are willing to 'Go For It!'Many people these days are getting more and more concerned as they approach retirement age.
Buying a Newly-Built Home? Ten Benefits of Using a Real Estate Professional
It might not seem necessary to involve a real estate professional in a transaction where a buyer can deal directly with a builder. However, by using a real estate professional, you have someone to protect your interests and guide you along the right path.
Just Give Me Eleven Reasons to Buy in Dubai
Buying overseas property is not always for the fainthearted but we think Dubai is an exception to this. Here are eleven reasons to buy in Dubai:1.
Real Estate Development Feasibility Study (Income) - $1.2 Billion Developer Tells You How To Do One
There are two sides to a feasibility study and in an earlier article I discussed the cost side of the format and:Now Let's Discuss The Income SideWithout the Sales Income, All You've Done Is Spend Money, And Anyone Can Do That.So that we are clear in what I am going to define for you, let me say that there are two forms of Income.
Property for Sale in Piemonte Italy is Attracting British Interest
The Region has four distinct seasons but in general possesses a Mediterranean feel strongly influenced by the proximity of the Mediterranean Sea. Winters are short and cold (the snow and mountains providing spectacular scenery for the region's ski resorts).
Selling Houses: Design Psychology and Interior Colors
Interior colors are vitally important to selling your home quickly, and for more money. But you must always take your target market and selling season into account, using Design Psychology techniques, when choosing the colors for the inside of your home.
Stopping Home Foreclosure with Bankruptcy
Bankruptcy Will Stop Your Sale - At Least For Now For $395, you can stop your sale- at least that is what the ads say. You are about to find out how bankruptcy can be good or very damaging.
Planning for Real Estate with Estate Planning
One of the most important considerations you will need to make in regards to your real estate holdings and your estate includes tax planning. If not handled properly, your estate could end up getting hit with significant losses due to taxes after your demise.
5 Hot Tips for Successful Real Estate Investment
The last downturn of the global stock market saw millions of 'every day' investors having their fingers badly burned. Overnight life savings were eaten away, retirement funds went into decline and the economic forecast for all of us who had any money invested in stocks and shares was gloomy to say the very least.
How Can Real Estate Investors Profit From The Internet?
The Internet is a powerful marketing tool, but just how can a real estate investor make the best use of Web pages?We've spent some time experimenting with Web sites and we've found a couple of ways that they can be useful.First.
How to Eliminate Risk in Real Estate Investment
Avoid 12 Common Mistakes Made by Novice Investors and Ensure High Rates of Return!Real estate investment has provided many investors with positive cash flow, tax benefits and satisfaction of making an impact in others lives. Like any investment however, real estate has intricate nuances and market trends that when ignored can cause an investor tremendous heart ache.
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