Real Estate Investors
For decades - and especially the last decade - real estate investors seeking income have been advised to allocate a portion of their assets to real estate. After all, real estate offers a relatively high level of income (up to a 15% rental yield in some locations) and - as a hard asset - offers at very least some protection of principal.
In recent years, investors often sought diversification into real estate through real estate investment trusts (REITs), since owning actual properties outright was too expensive for the average retiree or income investor.
Bubble-era housing prices and the low interest rates that fueled them made it more attractive than ever for developers to build condos all around this country, but a recent decline in households' net worth, coupled with tighter lending standards, has made it harder than ever for developers to sell their properties. This bust for lenders has been a boon for savvy investors.
By employing a real estate auction company, savvy real estate investors are able to pick up condominiums in desirable locations like New York, Chicago, and Los Angeles for sometimes less than half of their original asking price.
And the case for buying condo properties now is compelling for many reasons. First, as an income-producing asset, real estate is almost unrivaled, since income can be realized in perpetuity (or until the building collapses) - try getting that yield with a bond!
Second, the prices that many real estate investors are paying through a real estate auction company often augment those yields and account for a good deal of greater downside in the market. Third, as a hard asset, real estate will outperform bonds or cash in an inflationary environment. And fourth, real estate is useful - it can be used as a residence. What high-yielding stock provides walls and central air?
Joking aside, most metropolitan real estate markets have taken huge hits, but there are some signs of stabilizing. The buyers who will make the most money in an inevitable long-term rebound in real estate are those that are willing to stick their necks out early.
Owning a condo offers an alternative to owning a soft-asset REIT for diversification and has the added bonus of being a hard asset that investors can live in or pass on to children, grandchildren, etc, and the ability to buy at auction offers the opportunity to get away with paying prices that - years from now - will seem impossibly low.
Home Ownership Rate
The home ownership rate fell to a level not seen since 1999 in the second quarter, according to a report from the U.S. Census Bureau and the U.S. Department of Commerce. The rate had previously fallen to 2000 levels in the first quarter.
The rate, 66.9 percent, was about 0.2 percentage points lower than the first quarter's rate of 67.1 percent, and about 0.5 percentage points lower than 2009's second-quarter rate, 67.4 percent, the report said. Homeownership peaked in 2004, when it was at 69.2 percent for both the second and fourth quarters.
Rental and homeowner vacancy rates -- 10.6 percent for rentals and 2.5 percent for homeowner housing -- remained essentially flat compared to the first quarter and the second quarter of 2009.
The former is the highest second-quarter vacancy rate since the agency began keeping records in 1956. The second-quarter peak for homeowner vacancy was in 2008, when it was 2.8 percent. The overall vacancy rate nationwide in the second quarter was 14.4 percent.
Regionally, the West and the South saw the biggest quarter-over-quarter declines in the home ownership rate, to 61.4 percent from 62.5 percent in the West, and to 69.1 percent from 70 percent in the South. The Midwest had the highest rate and was the only region to see its rate increase in the past year: to 70.8 percent from 70.5 percent. The rate in the Northeast stayed roughly level at 64.2 percent.
Approximately 85.6 percent of the real estate housing units in the United States in the second quarter 2010 were occupied and 14.4 percent were vacant. Owner-occupied housing units made up 57.3 percent of total housing units, while renter-occupied units made up 28.3 percent of the inventory in the second quarter 2010. Vacant year-round units comprised 11.0 percent of total housing units, while 3.4 percent were for seasonal use. Approximately 3.4 percent of the total units were for rent, 1.5 percent were for sale only, and 0.7 percent were rented or sold but not yet occupied. Vacant units that were held off market comprised 5.4 percent of the total housing stock. Of these units, 1.6 percent were for occasional use only, 0.9 percent were temporarily occupied by usual residence elsewhere (URE), and 2.9 percent were vacant for a variety of other reasons.
For the second quarter 2010, the home ownership rates were highest in the Midwest (70.8 percent) and lowest in the West (61.4 percent). The homeownership rates in the South and West were lower than a year ago, while rates in the Northeast and Midwest were not statistically different from their corresponding second quarter 2009 rates.
For the second quarter 2010, the homeownership rates were highest for those householders ages 65 years and over (80.4 percent) and lowest for the under 35 years of age group (39.0 percent). The rates for householders 35 to 44, 45 to 54, and 55 to 64 years old were lower than their respective rates a year ago, while those householders less than 35 years old and those 65 years and over showed no significant change from their corresponding rates in the second quarter 2009. REO properties were not included in this report.
1963 Mortgage Interest Rates
You've probably heard it countless times in the last year or so: "Mortgage Interest Rates at Historic Lows!"
What does that even mean?
How about this perspective instead: "Buy a home with 1963 mortgage interest rates."
If you weren't around in 1963, or just don't remember it, well, we certainly know an awful lot of things were far cheaper back then, and mortgage interest rates were, too.
How about a 1963 Chevy Impala with a 327 V-8 engine and automatic transmission? Manufacturer's retail price new was $3,725.75.
Or two dozen oranges for just 89 cents? Gasoline for just over 25 cents per gallon? The price of real estate? The list goes on.
It's incredible to think that in 2010, mortgage interest rates are about what they were in 1963....the year President John F. Kennedy was in office and the year Dr. Martin Luther King Jr. delivered his famous "I Have a Dream" speech.
In fact, at 4.42 percent, average, for a 30-year mortgage, as reported by Fannie Mae, rates are actually slightly below what they were in 1963. That's pretty amazing. There's not much available at the same rate as almost 40 years ago, but 1963 mortgage interest rates certainly apply.
Should you buy a condo or house and take advantage of what could be once-in-a-lifetime low rates? It warrants careful consideration. In fact, one of our fellow bloggers just explored the topic in his post entitled "Why Should I Buy Now?"
Personal circumstances vary, of course. Generally speaking, if you don't have a property to sell first, you're in an excellent position to purchase a house, townhome or condo in the current economy because many sellers have lowered prices and/or provided incentives.
If you have a property to sell first, however, it's important to price it correctly and realistically to reflect the current market. Our condo specialist Realtors can assist with this. Be sure the property is up to date, clean, well-staged and with great curb appeal. Real estate sales may be down in the current economy but there are still plenty of properties bought and sold every day. It takes careful strategy to get it done, with the help of one of our professionals.
And if you're wondering where to find these great mortgage rates, we're more than happy to suggest a great resource, Bank of America. Whether you are looking for condo financing or financing for a house, investment property or other real estate, the people we've worked with at Bank of America are ready to talk with you about your needs. Click the link in the previous sentence to get started.
As you shop for the best mortgage plan for your needs, please know that mortgage interest rates available through lenders fluctuate weekly, sometimes daily, but the overall trend for many months now has been for these rates to be historically low. Interested in a 1963 mortage interest rate? Here's your chance!
The Advantages of Los Angeles Real Estate Auctions
The real estate market in California is very well-known around the world, and there is a good reason this is a fact. It's also a well-known fact that each time the market declines and market values drop, it is only a temporary recession, and they rebound in a short amount of time.
Despite the resiliency of the market, however, Los Angeles real estate auctions are an excellent arena for both buyers and sellers.
It helps them negotiate prices that are close to the market value, and most importantly, it expedites the sales process. No lengthy negotiations are required, and no stacks of paperwork face buyers as they're trying to close a deal. In fact, the majority of real estate auctions take less than three months from start to finish.
One of the reasons the Los Angeles real estate market is so resilient is that so much economic commerce going on in that area. People are constantly moving to California for jobs and business opportunities, and naturally, they're going to need a place to live. Often, rather than paying high prices in rent, they would rather invest their money in real estate.
This is why Los Angeles real estate auctions are in such a high demand. The population of southern California is one of the fastest growing populations in the country, and this puts demand pressure on prices and causes prices to go up. The competition auctions foster also tends to drive the prices up.
Therefore, sellers can benefit from auctions in Los Angeles just as much as the buyers. One of the things that is most fortuitous to sellers engaging in transactions that take place at auctions is that the auction house provides advertising for the event.
They pay for advertisements on the radio and television, and they also put ads in various print publications that are tailored toward the real estate industry. This is particularly beneficial because advertisements are quite expensive, and sellers might not have the capital to invest in them while trying to move a certain piece of property.
Because of the growth of the real estate market in California, use of Los Angeles real estate auctions are a growing trend. Federal aid has been directed to California to help it get out of its financial crisis, and thousands of immigrants stream over the border each day that will need to find housing.
They will most likely be looking to purchase real estate at the lower end of the market, so this will create a price floor for the rest of the market, and people at all income levels will benefit.
Auctions offer a quick and easy way for buyers and sellers to complete transactions, but it's important for both of them to be well-informed about the market so that they don't get ripped off or end up losing money by becoming caught up in a bidding frenzy.
In Chicago, Real Estate Auctions can be Helpful
Auctions have many benefits to potential buyers. They can access a large selection of properties up for sale, and can obtain prices that are often lower than the market value.
They also get the opportunity to close a sale in less than one month, which is quite appealing since buying real estate in a conventional method can be a very drawn out procedure that includes lengthy negotiations and lots of paperwork.
In Chicago, real estate auctions also offer many benefits to sellers as well. This is why for all parties involved in the auction process, they are gaining popularity as a method of making real estate transactions in the evolving real estate and economic climate.
Chicago real estate auctions allow sellers to sell a property with maximum efficiency. While this is important, it's also vital to note that they will get a fair price for what they're trying to sell.
Due to the competitive nature of auctions, bidders often try to win the property that they most desire, and get caught up in the excitement at the auction house. This is excellent for sellers since they will want to get the most money possible for their real estate.
Especially in Chicago, it's important to sellers that they're able to move their property without a large time delay. Owners want the best return they can get, but they don't want to waste time with buyers who might be inclined to back out of a deal at the last minute.
The fact that auctions close deals in a short amount of time is perfect for property owners that need to move quickly to take on a new job position, if they've inherited property they don't wish to put to personal use, or if they simply need the extra cash due to the current economic crisis.
It's also expensive to maintain property and pay property tax on it, so if sellers are able to get rid of it quickly, this will save them money overall. They might even be willing to accept a bid that's lower than what they wanted to receive it it means it will save them a few extra months of having to deal with being a property owner.
Although auctions present numerous benefits to sellers, Chicago real estate auctions also are a great marketplace for buyers.
They benefit from quick sales just as much as the sellers; no one wants to deal with the hassle of stacks of paperwork or tedious negotiations. Buyers can also feel confident that the properties have been thoroughly inspected and are ready for them to move into as soon as the sale is closed.
Even if buyers go into the auction with a certain price in mind for a property, however, they cannot bid under a minimum bid rate if it's been assigned by a seller. Therefore, in any case, a fair market value for a piece of property is arranged so that both parties involved in the real estate transaction can benefit from an expedited sale.
Possibilities with Online Real Estate Auctions
Online real estate auctions are excellent ways to find deals on real estate that you might not be able to find in traditional markets.
They make it easy for potential buyers to peruse a list of properties and find out what features they offer, and it's also easy to do comparative analysis online in order to find out more about the market in the area that has piqued your interest.
Although they are simple and efficient, however, it's still important for buyers to stay informed about their decisions and, if possible, for them to go to the auction in person to finalize the transaction that they would like to make.
In the real estate market, online real estate auctions do not function exactly like other online auction sites such as eBay.
It's difficult to make a purchase with confidence if you haven't had time to go see the property in person. Because sales at auctions are final, it's imperative for buyers to feel confident about their decisions.
They'll want to make sure the property has been properly inspected, for instance, and that it has been well-maintained and kept up so that they can move in immediately after the sale is completed. They'll also want to fully investigate the neighborhood if they aren't familiar with the area. It's a good idea to visit the area at different times a day, and to go through it from all different directions in order to find out what it's like and what kind of people live in it.
The advantage of looking into real estate online is that all the listings available are posted on a site that is easy to navigate. Therefore, hours of driving around to locations only to find that they're disappointing or in a less desirable part of time are no longer necessary.
Potential buyers can determine which properties pique their interest from home, and then go out to the actual locations to make sure they still would like to own that property.
All real estate auctions have corresponding websites which include all the properties that will be for sale at a particular auction. By carefully going over these websites, buyers can start the process of making a purchase before they even go to the auction to place a bid.
Online real estate auctions also offer excellent deals that might not be available when trading real estate in a conventional manner. The online market is very popular and a lot of people by real estate in this manner. As a result, competition is quite high. Competition tends to drive prices up, but buyers have the advantage of not paying any more than what they intend to bid when they walk in an auction house.
They also have the advantage of quick sales; real estate transactions can often be very drawn out procedures, but if a real estate websites can expedite some of the preliminary research, then buyers will feel more confident with a fast decision made when they bid and a deal is closed. If buyers are well-informed about the real estate market, online opportunities for research can be quite helpful as they search for the right property to own.
Advantages of Real Estate Auctions
Do you want to find out how to sell a piece of property at a real estate auction? If so, you're in luck; there are numerous ways that real estate auctions can help sellers get the best offer on their piece of property. This is particularly important because auctions can actually help sellers get better prices than conventional methods of real estate transactions.
They are also more efficient, and this helps sellers if they need to move a piece of land due to financial hardships such as property taxes they don't want to pay, or other expenses associated with owning land.
When selling property at real estate auctions, tons of people will be checking out your piece of real estate. They're all at least somewhat interested in it, and they definitely are ready to complete a sale immediately. The process is quite easy, and is over in as little as three months.
In the first month, your property is placed on a list of all properties that are going to be for sale at an auction. The auction house will list the piece of real estate on a website, and then will advertise it to potential buyers in the surrounding area for you, making everyone aware of when the auction is going to take place and where it's going to be held.
During the last month, your piece of real estate will be inspected so that the buyers can move in immediately, and a few open houses will follow the inspection so that buyers can see it in person.
This last month is especially critical, because buyers usually decide whether or not they want to buy a piece of property after they see it for themselves. They will meticulously go through the real estate, so it's important to have all the repairs and maintenance completed before they walk through.
They're aware of the fact that when they purchase your property, they are buying it in the exact same condition it will be in when they see it. This is an advantage to the seller, however, because after the sale takes place, there is no room for complaints from the buyer if they aren't happy with a specific feature of the property.
If the advertising campaign done by a real estate company is effective, a minimum of a couple hundred people will come to make offers on all the properties up for sale at real estate auctions. This marketing isn't possible when someone is trying to sell a piece of property themselves; it would cost too much time or money.
A room full of buyers eager to walk away with a great deal will start making bids, and due to competition, you might receive a higher price for your property than you expected. The excitement involved in the process is also an advantage, but ultimately, auctions are an excellent way to streamline the process of completing a real estate transaction.
Using a Real Estate Auction Company
As the real estate business continues to evolve, an ancient system of trading in the marketplace has come back into vogue and is continuing to expand along with the market. Use of a real estate auction company has become more and more popular, especially due to the economic downturn, and their popularity is still growing even more.
Therefore, it's important to investigate why they have become so appealing and what benefits they can offer to people looking to invest in real estate.
According to the National Auctioneers association, more than $268 billion worth of completed sales started in auction companies. This means that auctions are one of the most accelerated sectors within sales for almost all varieties of property such as residential real estate or agriculture.
Use of a real estate auction company has grown for the past six years straight; however, some people are still misinformed about them and are wary of buying property through use of a company. Nevertheless, using such a company to complete real estate transactions has a number of benefits. The following is a brief overview of some of them.
Usually, sales take less time, and can be completed in thirty to forty five days. This is because there are no long and complicated negotiations; the property is selling at its true market value.
Additionally, properties are sold with no contingencies, and there is no question of whether or not a deal will be completed. The sales approach is highly visible, and advertising campaigns often precede auctions that utilize brochures and brochures.
It also helps that both the buyers and sellers who are engaged in the auction process are ready to complete the deal; they are less likely to spend time deliberating or backing out of a transaction, and the results of the auction are immediate.
The reason why use of a real estate auction company to make real estate transactions has been in practice for such a long time is that it's extremely efficient and effective.
The company is able to foster a mood of excitement among potential buyers of real estate that promotes direct competition; in turn, this means higher prices are more likely than in conventional real estate business deals.
The seller will receive a higher price, and the buyer can be sure that he isn't paying anything beyond market value, or possibly less. Both parties involved in the auction can benefit from this procedure of selling real estate.
The Advantages of Los Angeles Real Estate Auctions
The real estate market in California is very well-known around the world, and there is a good reason this is a fact. It's also a well-known fact that each time the market declines and market values drop, it is only a temporary recession, and they rebound in a short amount of time.
Despite the resiliency of the market, however, Los Angeles real estate auctions are an excellent arena for both buyers and sellers. It helps them negotiate prices that are close to the market value, and most importantly, it expedites the sales process.
No lengthy negotiations are required, and no stacks of paperwork face buyers as they're trying to close a deal. In fact, the majority of real estate auctions take less than three months from start to finish.
One of the reasons the Los Angeles real estate market is so resilient is that so much economic commerce going on in that area. People are constantly moving to California for jobs and business opportunities, and naturally, they're going to need a place to live. Often, rather than paying high prices in rent, they would rather invest their money in real estate.
This is why Los Angeles real estate auctions are in such a high demand. The population of southern California is one of the fastest growing populations in the country, and this puts demand pressure on prices and causes prices to go up. The competition auctions foster also tends to drive the prices up.
Therefore, sellers can benefit from auctions in Los Angeles just as much as the buyers. One of the things that is most fortuitous to sellers engaging in transactions that take place at auctions is that the auction house provides advertising for the event.
They pay for advertisements on the radio and television, and they also put ads in various print publications that are tailored towards the real estate industry.
This is particularly beneficial because advertisements are quite expensive, and sellers might not have the capital to invest in them while trying to move a certain piece of property.
Because of the growth of the real estate market in California, use of Los Angeles real estate auctions are a growing trend. Federal aid has been directed to California to help it get out of its financial crisis, and thousands of immigrants stream over the border each day that will need to find housing.
They will most likely be looking to purchase real estate at the lower end of the market, so this will create a price floor for the rest of the market, and people at all income levels will benefit.
Auctions offer a quick and easy way for buyers and sellers to complete transactions, but it's important for both of them to be well-informed about the market so that they don't get ripped off or end up losing money by becoming caught up in a bidding frenzy.
