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How To Really Figure Out How Strong Your Real Estate Market Is

by blogger1
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on Tuesday, 02 April 2024
BestTransactionFunding

If you are trying to make sense of the current real estate market and get a better handle on the type of offers you should be making and advertising, you are not alone.


There is a lot of confusion over the state of the economy. Some claim it’s red hot. Others feel we are already in a deep recession.


The claims of many major news outlets, real estate brokerages, and what others in the business are predicting may not line up with each other or your experiences.


Even the Fed seems to change their mind about the economy and their plan to fix it every day.  So, how are real estate investors to make sense of the direction of the market, how much they should be bidding for homes, and what they can expect to flip houses for?


Consider these alternatives to headlines or all the questionable claims and data out there…


Ask Your Local Pawn Shop

Pawn shop operators have a great pulse on the market. They know if people are buying and paying back loans fast, or whether they are losing their stuff, and are having to bring in family heirlooms and their personal valuables for whatever few dollars they can get.


Go To The Gym

For one, you’ll see how many people are still paying for their gym memberships. You’ll also overhear whether others are buying, selling, investing, refinancing, or moving, and get a real feel for the local market.


Talk To The Cops

The Sheriff’s office handles evictions. They’ll know if there is a surge in squatting incidents, homelessness, and evictions. Which also indicates how healthy landlords’ finances are.


Check Out Old MLS Listings

How many aged MLS listings are there? Are days on market growing? What percentage of home sellers are making price cuts? Are agents offering bonuses for fast sales or offering to cut their commissions?


Run Some Ads

Put up an ad for a house for sale. Are you swamped with immediate full priced offers? Or are you only getting occasional low ball offers and questions from buyers that don’t follow through?


Get On Tinder

Financial distress causes a huge amount of relationship stress. Money is the number one reason couples seem to end up arguing. Divorces also drive distressed listings and rental demand. So, is your local Tinder pool swarming with new dating profiles? Or is it shrinking as couples get together and move in together?

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Real Estate Flips To A Buyers’ Market

by blogger1
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on Wednesday, 01 June 2022
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Few saw the change coming this fast. Yet, in just a matter of weeks it appears that the North American real estate market has substantially shifted in favor of buyers.


This is great news for real estate wholesalers. It also means that those who are still stuck holding properties need to move them very fast.


Home Sellers Are Slashing Prices

We’ve fast gone from incredible bidding wars, with even big investment firms proudly paying 50% over market value for properties, to sellers almost competing just as fiercely in slashing their asking prices.


In Boise, Idaho 40% of home sellers have recently reduced their prices. Followed by around 30% in New Orleans, and Cape Coral.


Home Values Are Coming Down

Of course, in turn, sales prices and home values are coming down along with that. Some cities are already reportedly seeing them down 10% to 15%. For example, in Kalamazoo, MI.


Similar trends have been reported in Canada, where the market has also flipped, and recently hot markets like Waterloo are down by 8.5% as of April. With economists expecting them to drop by 20%.


It is true that these are reductions from very lofty highs. If the Fed can manage a soft landing it could just mean a slowing of growth, without an absolute crash.


Though JP Morgan Chase’s CEO just warned that we are facing an imminent financial hurricane.


What It Means For Real Estate Investors

Those still holding rehabs and speculative flips need to exit them fast. Or they face being caught underwater, with dead weight that is dragging them down.


Of course, most experienced investors have been waiting for this moment. They’ve been waiting for asset prices to come down, and the numbers make sense again.


It’s time to get bidding, and scaling. Just at the right figures, which price in the drop. Then wholesale them fast enough not to get caught with any further declines.


Obviously, this is best done by filling pre-orders from other investors who have cash and are ready to buy them immediately once they are under contract.


While capital markets have been flush, and business and mortgage lenders eager to put money to work out there, rising rates, and fear of a contraction could change that.


This makes leveraging transactional funding for quick in and out deals, with low risk an even more appealing option as we look ahead.

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