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Archives for October 2008

Fed Slashes Key Interest Rate to 1 Percent

October 29, 2008 by Marco Santarelli

In an effort to revive the economy the Federal Reserve cut the federal funds rate today but a half-point (0.5%). This lowers the rate to 1 percent – the lowest rate since 2003-2004. The last time the federal funds rate was lower than 1 percent was during the Eisenhower administration in 1958.

Today’s interest rate cut was the second half-point cut this month. The last one on October 8, 2008 was in a coordinated move with foreign central banks.

This year’s economic weakness has created huge declines in the price of oil and other commodities. While many economists believe the country is in a recession, they also believe the recent rate cuts and other aggressive actions by the Fed will help prevent a prolonged downturn and help unfreeze the credit markets.

If these aggressive moves by the federal government are successful in thawing the credit markets, it will be great news for real estate investors who are having difficulty financing their real estate investments.

Filed Under: Economy, Financing Tagged With: Economy, Mortgage Loans, Real Estate Economics, Real Estate Finance, Real Estate Financing, Real Estate Investing, Real Estate Markets

National Real Estate Market Analysis

October 15, 2008 by Marco Santarelli

eppraisal.com released their National Market Analysis Report for the three months ending August 2008. Of the 188 market areas tracked across the U.S., 43.6 percent show a decline in median home values, which is up from 32.4 percent from the previous three months. This ends the upward trend from the last three reports where the number of markets showing an increase in median home values was on the rise.

Most markets in the report are showing signs of leveling out or increasing values, with California being an exception. California again tops the bottom of the list with 27 of the 28 markets tracked by eppraisal.com showing declining median home values. Chico, CA is the only market that is showing signs of rebounding (see figure below). For this report Chico, CA, saw an increase of 1.70 percent to a median sales price of $245,000.

Six California markets saw double digit declines: Madera down 10 percent, Bakersfield down 10.7 percent, Riverside-San Bernardino down 11.1 percent, Modesto down 11.3 percent, Salinas down 14.3 percent, and Merced down 11.5 percent.

Markets in North Carolina, South Carolina, Ohio, and Oregon continue to gain in value and continue to show signs of a changing market. For example, the Raleigh-Cary, NC, Florence, SC, and the Dayton, OH, markets all saw median home value increases of over five percent. Raleigh-Cary, NC, increased by 8.1 percent to $200,000, Florence, SC, increased by 8.7 percent to $106,000, and Dayton, OH, increased by 10.6 percent to $110,000.

Texas continues to hold on to the postitive trend while Florida starts to dip back into negative waters. In the last report 11 of the 20 areas tracked in Florida by eppraisal.com showed positive increases in median values. This month the number of Florida markets showing increases in home values is down to six: Fort Walton Beach-Destin up 9.7 percent to $203,000, Palm Coast up 8 percent to $175,000, Panama City up 6.7 percent to $176,000, Palm Bay-Melbourne up 5.7 percent to $156,000, West Palm-Boca Raton up 5.6 percent to $285,000 and Jacksonville up 1.7 percent to $183,900. Texas shows the opposite with seven of the 11 areas tracked by eppraisal.com showing increases in median values. At the top of the list sits McAllen-Edinburg with an increase of 7 percent to $115,875, Waco with an increase of 6 percent to 119,621, and Midland with an increase of 4 percent to $172,500.

See the complete list »

Filed Under: Economy, Real Estate Investing Tagged With: Housing Market, Real Estate Economics, Real Estate Investing, Real Estate Market

Riding Out the Real Estate Market Crash

October 13, 2008 by Marco Santarelli

Riding Out the Real Estate Market CrashReal estate has been regarded as one of the safest investments for quite some time.  However, despite the relative safety of real estate investments, there is always the possibility that the real estate market can fall just like any other investment.

Over the long term, real estate remains relatively safe simply due to the fact that the population of the world continues to increase while land is a limited resource.  When there is an occasional downturn in the real estate market, it is important to recognize certain strategies which can be used in order to keep a real estate investment from becoming a complete loss.

The first thought many people have when they realize the market has turned down is to attempt to sell the property as quickly as possible before the market gets worse.  In reality, most investors have found that it is often better if they can hold onto the property and ride out the market downturn.  While it is possible the market might dip lower before it rebounds, historically real estate markets always come back.

[Read more…]

Filed Under: Economy, Real Estate Investing, Real Estate Investments Tagged With: Housing Market, Real Estate Economics, Real Estate Investing, Real Estate Market

The Future of the Housing Market

October 8, 2008 by Marco Santarelli

The Future of the Housing MarketIn some of the worst housing markets in the country, deflation has reached double-digit proportions.  While housing woes have spread around the country, California appears to be poised to rank among the worse.  One of the primary reasons for this is the fact that in the last few quarters California has experienced the largest rate of deflating home prices.  In fact, home prices in California have fallen to levels that have been unprecedented.

Miami, Florida has also proven to be a difficult market at the moment.  The weak mortgage market and record high rates of foreclosures have led to declining home values as well.  In fact, Miami has been among the worst home markets in the country for two years running. The condo boom in Miami just a few years ago has further fueled the problems that have now spiraled into a massive real estate bust.

[Read more…]

Filed Under: Economy, Financing, Foreclosures, Real Estate Investing Tagged With: Housing Market, Real Estate Economics, Real Estate Investing, Real Estate Market

The Perfect Storm to Buy Real Estate

October 6, 2008 by Marco Santarelli

This may be the most amazing buyer’s market in decades!

Think about it.  Interest rates are at historic lows.  Housing inventories are at 20-year highs.  Nationally, housing prices have dropped 16.3% since last year.  Sellers of every kinds (home owners, investors, builders, and developers) are motivated to sell their property to liquidate or stay liquid in these tough economic times.

I’m sure most of you have heard these stats before:  Only 2% of retirees will be financially independent by age 65, while the other 98% rely on family, the government or a job to get by financially.

If you want to make a fortune in real estate, and I’m talking about millions of dollars, then now is the time to buy!  Forget about the uncertainties of the stock market and worrying about a recession.  Now is the time to position yourself for real wealth simply by buying real estate in growth markets around the country.

If you’re not sure how to get started then call me.  I will help point you in the right direction.

Filed Under: Real Estate Investing Tagged With: Investment Properties, Investment Property, Real Estate Investing, Real Estate Investment

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