When Warren Buffett said:
"If indeed there's been a bubble, and it's pricked at some point, the net effect on Berkshire might well be positive because the company's financial strength would allow it to buy real-estate-related businesses at bargain prices"
The little guy thought:
"Man, I should sock away as much cash as I can to buy distressed properties a few years from now".
If foreclosures are this bad today, just think how bad they'll be in 2008. Soon you'll see all the "get rich in real estate!" TV ads replaced with "make money on foreclosures!"
Rising interest rates and a cooling housing market are whetting the appetite of real-estate bargain hunters and fueling interest in Web sites that list homes in, or near, foreclosure.Economists expect delinquencies and foreclosures to increase from today's historically low levels.
Nationwide, the percentage of home loans on which payments were past due fell to 4.41 percent on a seasonally adjusted basis in the first quarter, after rising to 4.70 percent in the fourth quarter of 2005, according to the Mortgage Bankers Association.
A variety of Web sites have sprung up to cater to home buyers and investors looking to purchase properties in or nearing foreclosure. They include RealtyTrac.com, which ranked seventh among real-estate Web sites in terms of unique visitors in May, according to comScore Media Metrix, a unit of comScore Networks Inc. Foreclosure.com, another popular offering, not only runs its own Web site, but also says it supplies data to more than 200 other Web sites
July 06, 2006
Getting ready for the wave of distressed property and foreclosures
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18 comments:
Some of those greedy sellers, who are turning down low offers may end up in this situation of they don't get realistic about pricing their homes.
Hey, the font on that foreclosure sign is pretty slick 1920's art style.
Who knew homedebtors had such talent the the Depression?
It will be a long wait. People wont just walk away from the pie in the sky that easy. There is no pain in the economy right now, lots of jobs, trilions of trickle down dollars, and a feeling of can't do wrong in the air. We are in the middle period where the stupid money must get flushed out.
Big money doesn't buy houses. Big money makes money by lending for interest. They want to trick everyone into catching their falling knife. Well, they won't buy houses because after all the foreclosures they will already own more than they can handle. Don't be stupid and buy a house, houses have already had all the juice sucked out of them by the FBs. I sure get tired of all the lies.
What will all of these future home foreclosures mean for rental home prices (per month rent) in the future? I assume that due to demand rents will likely increase substantially?
I have been watching foreclosure.com since Dec 05, zeroing in on the five counties surrounding me and down south to include Baltimore City.Foreclosure rates have gone consistantly down in numbers, week to week, month to month. People will do anything to
keep from losing their home. Its going to be slow going. Like previous anon said "It will be a long wait."
Long wait my dimpled butt. Go to Indianapolis or Detroit and get your fill right now. This is going to be a lulu of a crash. Those FBs won't be able to hold on through the winter of '06-'07, much less until the end of the decade. What are you smoking, carpet scraps?
socal is still hot,utah seattle , maui no gloom and doom. sgftop lying.
If housing inventory increases why would you think that rents would also increase??
Rents will decrease as more and more landlords compete for quality tenants.
duh
They are building condos all over the place, I don't think rents are going up in the face of a supply glut.
Who in the hell would want to buy foreclosures now, at this stage of the game. The real money will be made in foreclosures near the end of the cycle.
I think it's a fools game to be even thinking about it at this stage of the game. Everyone should be figuring out where they want to live while we ride this thing down.
Question: Do you live in an area that's a little marginal, or, was marginal before the big boom. I suggest that you move somewhere else fast. Some of these area are time bombs whaiting to happen.
In SoCal, I can think of a few areas I don't want to be living at the market crashes.
Foreclosed properties don't necessarily mean higher rents. . .
An important figure to watch is "household formations". . .during the dotcom meltdown in the Bay Area - Sofa Surfing (sleeping on friends sofas) was popular, and for the first time in San Francisco history (since WWII) the vacancy rate went way up, and landlords had to lower rent. I suspect that people will move in with in-laws, friends, or double up to pay the mortgage. This will put more rentals and re-sales on the market.
Foreclosures absolutely mean lower rents. If, as an investor, your cost basis is lower than the competition, you going to make your life easier and rent for less because you can.
I've been through this before - Just watch.
From a former REO Marketing Analyst for the RTC at HomeFed Bank in San Diego
"bspays said...
Long wait my dimpled butt. Go to Indianapolis or Detroit and get your fill right now. This is going to be a lulu of a crash. Those FBs won't be able to hold on through the winter of '06-'07, much less until the end of the decade. What are you smoking, carpet scraps?"
I agree about Indy and especially Detroit. But I am only following the foreclosures in my surrounding area. We are all going to take a hit, in one way or another. Some areas will go down first, and fast! Others will play catch-up going down the spiral.
We all will eventually lose when this country hits bottom!
But where does the home owner who was foreclosed on live? I would guess that they don't go right out and buy another home... They rent. It would seem like a 1:1 swap, one more rental on the market and one more renter.
I asked my grandfather who was 17 when the great depression hit about how it all unfolded. I always wondered where everyone went when they losted there house. The bank came to their ranch and said we can't take it because of all the other properties that couldn't make their payments so just take care of it. Also most family members that had left the farm came home. They lived on a garden and animals they raised. Hard to do from a condo or small lot with a trophy house on it. He also said it hit overnight, one day everyone was out on the town spending money and the next day there was just no MONEY.
"Long wait my dimpled butt. Go to Indianapolis or Detroit and get your fill right now."
I wonder if there is a demographic side to this thing? Maybe some folks who didn't make a bunch of money but wanted to live like their favorite rap star borrowed the money to pay for the life.
What Happened to Forclosures in the 80's when interest rates were really high? did they spike up?
adam
ablondon2001@yahoo.com
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