All indicators point to a current bottoming process!
Why RIGHT NOW Is Deal Time in Real Estate By Dr. Steve Sjuggerud
U.S. home prices are down 70% in terms of gold.
Everything else on the planet is up: gold, stocks, bonds, emerging markets, commodities you name it. But home prices are down... And I'm buying. Here's why:
U.S. homes are more affordable than ever. Right here, right now.
You can get truly "stupid" deals right now. I'm not sure how long they'll last.
I'll show you affordability first. Then we'll quickly get to the "stupid" deals...
People buy homes based on their mortgage payments. They ask, "How much can I afford per month?" So housing "affordability" is a matter of three things: 1) home price, 2) mortgage rate, and 3) family income.
Home prices have crashed, and mortgage rates are at record lows. But family incomes have held up... So falling home prices plus ultra-low mortgage rates mean homes are more affordable than ever. Take a look...
Homes Have Never Been More Affordable
The last time home prices were even close to this affordable was the early 1970s. And you can see, home prices nationwide soared from those cheap levels. But affordability has NEVER been as great as it is right this minute!
Sure it feels bad out there in real estate. But that's the feeling you need to get some truly "stupid" deals...
Let's use the last big bubble as our guide... the dot-com bubble of 2000. Take a look at the chart. The story is simple...
Bubble, Bust, Bounce... Then Grind
After the Nasdaq Bust, the biggest gains were made in the Bounce... from October 2002 to January 2004. In just 15 months, the Nasdaq nearly doubled.
Much bigger gains are possible in real estate.
You can make bigger gains because, unlike the stock market, you CAN find absolutely stupid deals in real estate. All real estate is local... and each piece of property is unique. That's not true for, say, shares of Apple. And you would never have the chance to buy shares of Apple way below the market price. But the seller of a unique property may be desperate and ready to sell at a huge discount.
Right now, the same sequence is happening in real estate as in the dot-com days: Bubble, Bust, Bounce, and then the Grind.
We're Seeing the Same Thing in Real Estate
I believe we're in the end of the Bust and the beginning of the Bounce. This is where the deals will happen. Finding a deal now will be your only legitimate shot at making triple-digit gains in residential real estate over the next few years.
But you have to do it right. You're not going to make triple-digit profits buying at market price and selling at market price. You must buy WAY BELOW market price.
I expect the real estate Bounce will be meek. So you CANNOT count on price appreciation to make you your money. Instead, you have to buy at the first red star cheap, cheap, cheap and sell at the next red star which is STILL below market price.
Personally, I have made lots of offers... I was on the courthouse steps just yesterday to bid on a property. I've bought some property at ridiculous prices, so I can personally attest that there are extraordinary opportunities out there.
Look, homes are more affordable than ever. But it feels bad out there. This creates your opportunity. It's deal time in real estate. Get started!
Isn't it great to be able to bring a little sunshine into someone's life?
Going back over the past 3 years I noticed that the 30 year mortgage rates were stuck in the 5.5% to 6.5% range - considered by the experts to very inviting... and seem to have bottomed out between 4.75 and 5% during April and May of 2009, climbed a bit during the summer and fall and locally are now back down around 4.625% to 4.75% for a 30 year mortgage with no points!!!
If you wish to check out the rates in the Beaufort/Hilton Head area, please call Mike Platt, mortgage loan officer with South Carolina Bank & Trust at 843-342-1958 (direct line). Not only has he managed to supply our clients with the lowest rates around, he somehow manages to get those loans closed in today's difficult lending environment!
The Fed has pushed mortgage rates still lower by beginning to pump money into mortgage-backed securities. But keep an eye on Treasury yields as any increase from these ultra-low levels could counteract some of the Fed's efforts, and mortgage rates could begin to rise once again as they are starting to do now!
Despite high inventories and declining home prices, the Federal Housing Finance Agency (FHFA) announced that the conforming loan limit will remain $417,000 for 2009 for most areas in the U.S. but specified higher limits in certain cities and counties. The conforming loan limit is the maximum size of loans that Fannie Mae and Freddie Mac can purchase in 2009.
Translated simply, a jumbo mortgage loan amount for 2009 will be a mortgage that exceeds $417,000 in the Beaufort County region.
With todays tighter lending standards, please bear in mind the following:
With a purchase price of $521,250 and a 20% down payment, the loan amount would be $417,000 and within conforming loan limits.
With a purchase price of $463,333 and a 10% down payment, the loan amount would be $417,000 and within conforming loan limits.
Rates for these non-Jumbo loans are still extremely low, and coupled with reduced asking prices, this could be a great time for you to buy.
If you are planning the purchase of a coastal property, keep the figures mentioned above in mind... it could save you a considerable amount in monthly payments!
Housing in the U.S. is now more affordable than it has been since the early '70s.
There is one thing that we have learned in our many years in the real estate business - there are a lot of factors to consider other than "a hot price", "a buyer's market", or "a great mortgage rate".
We ran across this very well written article that gives prospective puchasers 10 very important questions to answer before leaping into what might appear to be a "hot deal". Just click on the link above to take you to the article... we know that you will enjoy this valuable information!
Do you have a property for sale on Fripp or Harbor Island? This housing slump has been protracted, and some would-be sellers are getting anxious! Our market continues to exert downward pressure on prices, but if you know how to handle the situation in a buyers market you can still manage to bring about a sale and accomplish your objectives. Click on the link below for assistance on how to realize your goals in todays real estate market.
Seller's Gems of Wisdom for Today's Real Estate Market. Did you know that investment real estate can be held in your Self Directed IRA as another form of tax-sheltered retirement investment? If you are contemplating investing in real estate, we have added an Investor's Corner. page containing many hints and other useful information to help you succeed in your endeavors. We include this material because we have found through experience that investing in coastal vacation properties is very different than investing in normal residential rental properties.
Beaufort County real estate is broken up into two main areas - the Beaufort area north of the Broad River, and the Hilton Head Island/Bluffton area to the South.
We specialize in properties on Fripp Island and Harbor Island, which are Barrier Islands located a few miles east of Beaufort. We supply you with links to all available MLS listed properties from our Fripp and Harbor Island home pages. You can search for other properties in the Beaufort area by searching the Beaufort Area MLS System.
For more information on your selected properties, or to make arrangements to view them, please Contact us.
Remember:Fripp Island and Harbor Island are private, guard-gated communities closed to the general public, as are many of the "plantaion communities" through-out Beaufort County.
Please let us make the proper arrangements to enable you to visit the properties of your choice!
Buyer/Seller Tips: Read through helpful tips of information on buying or selling your home!
Rick & Kerry Friesen - your Fripp Island & Harbor Island area Specialists Year-Round Fripp Island Residents since 1998 Providing over 50 years of friendly, professional marketing & sales experience. Is a real estate purchase in your future? We provide buyer representation!
Rick & Kerry Friesen are the owners and Rick is the Broker in Charge of Fripp Virtual Realty, Inc. 1551, Ste. 202, Sea Island Parkway St. Helena Island, SC 29920
Residence: 352 Blue Gill Road Fripp Island, SC 29920 Primary: 843-838-7194 Rick (Cell): (843) 597-5356 Kerry (Cell): (843) 575-0719
The information given on this website is supplied by third parties, most of them considered to be reliable. But it is the readers responsibility to verify all information prior to taking any actions relating thereto.
RICK & KERRY FRIESEN: Rick: 843-597-5356 - Kerry : 843-575-0719
