A recent report on CNNMoney talked about being an opportune time to grab bargains, and how real estate investors (they titles the article vultures) were hard at work grabbing up properties.
Across the world, commercial and residential real estate is distressed, and drawing in bargain hunters. This is good for foreclosure or under valued properties, and bad for upscale neighbors in highly exclusive neighborhoods who need strong comparables to sell against.
There is an estimated $90 billion in commercial real estate in the U.S. alone that is "distressed", according to a New York based real estate research firm Real Capital Analytics. These are properties that have been foreclosed on, or whose owners are in default on their loans or in bankruptcy. "On top of those properties, there is hundreds of billions more in debt coming due in the next few years," says Peter Slatin, editorial director at Real Capital. "Some REITs are getting prepared for that."
In Tour 18, and other exclusive Flower Mound neighborhoods, it's important to always sell at the highest possible value, in order to get a strong ROI and keep real estate strong. It's been increasingly hard at times though, when houses lapse into foreclosure.
Sometimes it is due to a divorce, other times loss of a job, other times, not planning well or saving for a rainy day.
My wife wrote a blog entry recently on her blog www.escapesuburbia.wordpress.com, called Chasing Oakleys, in which she referred to a story someone told her about nearly losing their life in pursuit of a pair of Oakley sunglasses. He'd been riding his bike in traffic, the Oakleys fell of, and he struggled to save them without thinking of the consequence. He didn't care if he got smashed by a car. He slid across the pavement, arm outstretched, and he said the only thought in his mind at the time was his brand new sunglasses.
How many times have we chased the Oakleys, only to come up empty handed? The blog entry was funny, but also a metaphor for the lives we lead. How many times do we fund ourselves ignoring the risk, and chasing after something we shouldn't?
The entire Real estate industry may be just an example of that. The way the housing market allowed the loads they allowed, the way homeowners were lured into loans or perhaps by their own making chose a situation that wasn't going to be good long term. A lot of risky decisions were made, from taking out several mortgages to bad loads with bad consequences. Today, there's finally a silver lining. CNN may call them vultures, but I call them investors.
Homes are selling.
House values are strong, particulary in my market, the luxury home area.
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