As you may have seen in the media lately, most of the best-appreciating markets have seen a significant slow-down in the appreciation rate. Even more accurately, I get news from our teams in the field that this is the case. You can see it in some of the fastest appreciating markets like Phoenix, and even in Las Vegas (despite the upwards pull of the inventory-suffocating SB321 which came into effect on 10/1/2013 and is a very strong pull on home prices).
Many other fast-appreciating markets are also leveling off. California markets and even some Florida markets have eased up some in the past couple of months. One obvious reason is seasonal – this is traditionally the slowest period of any year. However the rising interest rates have been keeping some would-be buyers at bay, and the prices themselves, having become higher – have put other buyers off. Some investors are starting to feel that they missed the boat in places like Phoenix due to the 70% gain it displayed in the past two years.
Well even in Phoenix, after a 70% gain in prices and now on a “respite” from appreciation, the prices are not that much above construction costs. Builders are still struggling to beat the prices of existing homes, and the intrinsic value is excellent. The same holds true in Las Vegas. Florida was already an excellent value (recall we discussed the judicial foreclosure process in FL slowing down market absorption of foreclosed homes, thus damping supply shortages somewhat) and now is poised to produce even better deals. It is not hard to buy a FL property in Jacksonville or Orlando/Tampa for substantially less than construction costs.
For investors, there is good news in what is happening. Our limited “window of opportunity” seems to be extending more. It is an excellent time to pounce on attractive Single Family Homes. We will discuss this and lots of other relevant and important new market data at our 1-Day Expo THIS SATURDAY! We invite you to attend (free for you and associates if you mention this blog – just email us at firstname.lastname@example.org). We will also have an OBAMACARE expert to guide us through the maze, and outstanding expert speakers in addition to lenders, and market teams straight from the trenches.
Looking forward to seeing you there!
I encounter many investors still tempted to get some flavor of an adjustable loan when using their available investment loans. There are extremely low-interest rates being offered on many shades of variable interest loans such as 1/1, 5/30 and so on.
Given that there is a virtual consensus among economists that we are headed to a high inflation period, it would not be the wisest move. When inflation is looming the need for fixed rate loans becomes even greater than it usually is. Fixed-rates are still very low, not far from the lowest rates in over 50 years. At this point, and before inflation rears its ugly head, it is definitely the time to lock in a rate forever.
Once you have locked in your 30-year fixed rate loan, inflation actually becomes your ally. It erodes the real monetary value of your loan, which never changes with inflation because it’s, well… FIXED! In a way, the very process of inflation will hasten the real-life pay down of your loan balance.
Many of you are eligible for a lot more investment loans than you might think. We will talk about this in detail, and also share strategies to increase the number of investment loans you can get at our incredible Real Estate 1 Day Expo on Saturday, December 7, 2013, near San Francisco Airport. More details can be found on our website www.icgre.com. We have been producing these events for over 20 years, and we always have the most useful experts to assist you.
This time there will also be a discussion of the new Affordable Care Act (Obamacare) and strategies on what to do, credit enhancement and repair (to be able to get all these loans), and an amazing lawyer battling the banks in court to share his insights and wisdom. In addition, market teams from the most relevant markets in the US will be there. Looking forward to seeing you!