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Better times are coming in real estate markets and here’s why

This Guest post by Jeff Lindikoff

I hope you are enjoying the beautiful fall weather. It is certainly my favorite time of the year and good things are on the horizon for Real Estate Investors.

We have been saying for most of this year that with an election year coming up, the government will make a move to stabilize the housing market and reduce the fear that has been driven by the looming number of nationwide foreclosures. The stock market was not up nearly 400 points today just because Europe has found a solution for their financial crisis, there was good news domestically about the US economy as well.

The sale of new homes in September surpassed experts estimates due to low interest rates, low prices, as well as pent up demand for new homes. However, contracts to buy existing homes fell in September according to the National Association of Realtors, and the culprit is confidence. What’s weighing on confidence are still-falling home prices, and what’s pushing those home prices down are foreclosures.

Today, on CNBC.Com, in an article from Realty Check, it was stated: The Obama Administration is pushing a potential plan to auction off foreclosed properties in bulk to investors, specifically the quarter of a million properties currently on the books of Fannie Mae, Freddie Mac, and the FHA. “As demand for single family rental properties rises, so too do potential investor returns.

According to an administration source: ” There is a hope that we ‘ll be able to do a pilot in the near future, perhaps by the end of 2011 or early 2012.”

“Many investors are out there raising billions of dollars to buy these properties,” says Jaret Seiberg of MF Global. “It’s a great idea, and it’s one of the few things that we’ve heard in several years now that can really help housing in a meaningful way. The idea is not just to reduce supply but to reduce the fear that there ‘s going to be this massive flood of foreclosed homes into many markets, and that fear of this foreclosure inventory that’s really keeping prices down,” adds Sieberg.

“The beginning of the of the rentership society is upon us,” says analysts at Morgan Stanley. “Single family rental total returns offer lower volatility and outsized returns Vs. other major asset classes, even when accounting for the housing bubble and subsequent declines.”

This is not surprising news to us as we have been saying for months that the federal agencies will sell off their foreclosures in bulk to investors as the demand for rents are way up. We are already seeing a large number of international investors in the US housing market as they see the prices of our homes to be a steal. When the current administration announces a plan to reduce foreclosures as well as offering incentives such as tax breaks and low interest loans for investors, which will be soon to take advantage of the election year, investors will be coming back to the market and prices will stabilize.

Now is a great time to take advantage of the discounted prices on Investment Real Estate. We are working with fantastic asset managers in Kansas City, Indianapolis, and very soon Memphis. Please visit our website at www.realestateio.com for updates.

Please feel free to call me anytime at 541-537-2042 to discuss Real Estate investing. We have been in this arena for over 20 years and have wonderful contacts all over the United States bringing us fantastic cash flowing properties.

Jeff Lindikoff, Total Property Solutions, LLC, j.lindikoff@gmail.com, 541-537-2042, www.realestateio.com

— Clay (sparkman@lendicom.com, 503-476-2909 or 800-971-1858)

Clay is Vice President of Fairfield Financial, a primary source for private money loans since 1964.  Fairfield works with a broad range of private money investors, in a broker capacity, finding, underwriting, presenting, closing, servicing, and when necessary, assisting in the workout of difficult loans.

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One Response to “Better times are coming in real estate markets and here’s why”

  1. Why would bulk sales of foreclosed properties to investors be less disruptive than just letting them hit the market over time, naturally? What do you think us investors are going to do with them? We’ll keep some, but we’ll dump the rest on the market at wholesale. Oh, wait – I see it already – there’ll be a restriction on resales – no matter, it’ll just delay the inevitable until a year or so later (past election day, of course), when those investors are finally able to unload them. This is a terrible plan. I’m sorry these banks and GSEs made some bad loans and got stuck holding the bag, but it was their own doing, and they need to take their medicine now. Get the government out of the plan, and also, stop bailing them out with my taxes.

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