So I'm in Las Vegas for a shortsale/REO summit...

[Redlinerobert]

From the looks of it, the worst of the foreclosure market is yet to come guys. There are so many homes either in foreclosure or close to it, that many of the banks that we currently deal with can not handle the load so they're using outside sources to help sell and manage these homes.

More details later.

[Mattlures]

what do you recomend? Invest? Sell? Buy? Refy?

what does this news mean?

[J Francho]

REO Speedwagon?  ;D

[Glenn]

That's ok Robert, we're still "gonna keep on lovin' you...."

[Redlinerobert]

The time is ripe to invest.  With prices being where they are at, RE makes a very good long term investment.  You are literally buying at the bottom right now.  One thing that banks and investors are trying to avoid is saturation in the market, so we will see the properties being released in stages.   We currently are selling primarily REO properties and short sale properties, it's been a couple years since we've sold a 'regular' property.  Depending on where you are at though, the market has not been hit as hard as others.  In Monterey County, CA, where my offices are based, we're seeing prices at about 60% less than what they were at during the peak of the market.

Oh and Glenn, I'm staying at 'The compound'.  The house is 95% complete, and at 51,000 sq ft, it's in the top 15 largest homes in the entire country.

[SirSnookalot]

Real estate is ok if you have deep enough pockets to handle the carrying costs over a period of time ( Hoa, property taxes, maintenance,HO insurance, county club dues and required costs like the grille)for an investment property or second home.  It's a good time to buy for your primary residence, providing you don't take a bath on your existing home.

As far as refinance, great idea if you owe less than than what the new appraisal and an 80% lTV is important to avoid PMI, don't forget closing costs.

Personally I always preferred stocks, many have had giant gains over the last year, plus it's liquid and no carrying costs except a buy and sell commission, which you are going to have with real estate too, unless you are your own broker and double dip it.

Just my opinion, to each their own.

[soccplayer07]

I'm on month 5 in my short sale purchase process...not fun. patience is not one of my virtues...

The market where I live (northern VA) is loaded with short sales and foreclosures. Most of the foreclosures are being purchased by investors with cash offers making it very difficult for purchasers using loans. Most properties (less than 500k) are getting multiple offers (10+). It's a very tough process but the prices are outstanding!

[frogtog]

Win me a nice watch while you are out their. ;D things will get better Robert, I promise. 8-)

[J Francho]

The time is ripe to invest.

Amen to that brother!  Its a great time for a guy my age, starting to put things together for later.

[Glenn]

Oh and Glenn, I'm staying at 'The compound'. The house is 95% complete, and at 51,000 sq ft, it's in the top 15 largest homes in the entire country.

Cool man.  Bet it's looking really good now.  Say hi to Eric for me will ya?

[Root beer]

I heard the house next door from me up for auction and starting bid is 1,000.00

I wouldn't mind trying snagged that property for 20 grands and then flipped it for 100 grands later on down the road. The house itself in good shape, it in neighborhood where price range from 90-120 grands. But the economy in this town isn't bringing any new jobs to town, so who knows how long it take to sell it. I know a guy that running small mortgage business and I thought about talking to him about it. Eh, screw it.

Guess I will stick to stocks. ;D

[Redlinerobert]

Looks like 2010 will be the year of the short sale.  Many banks are simply more reluctant to take the property back and sell it as an REO.  I can tell you that our REO inventory has drastically diminished, only to be replaced by more short sales.  The issue is that there is no standardized format for the short sale process.  Each lender/investor has their own manner in dealing with things, which only makes things more difficult as well as time consuming.

My suggestion is that if any of you are looking to purchase, deal with someone that has experience with the short sale process.  The last thing you want is to be the guinnea pig for an agent that has never closed a short sale transaction.  It could mean the differece between getting the deal done and losing.

If you have any  specific questins guys, feel free to pm me.

Glenn, Eric says hello.     If you're coming out for ICAST I may be here, we can stop by so you can see what he's done to the place.

[gobig]

How was the five star summit? I am curious how it was? I am Just a little farther north than you in Vallejo, CA.

I had to learn shortsales. I had no other options. I was to new in the business and REO companies shot me down. They wanted two years experience. Now I have a little bit of everything. But shortsales are an untapped resource and still my bread and butter.

We were one of the worst markets in the country... At one point 92% of our inventory was bank owned, 6% shortsale and 2% normal sales (if you consider probate normal).

Nationwide they are predicting another 6 million foreclosures this year. This ride is far from over in my opinion. I would not be surprised to see prices fall again. Especially on the high end. An asset manager from B of A said they are getting ready to release aprox 60,000 REO's over the next few months. The shadow inventory is huge.

As far as the year of the shortsale... I agree... except its is going to be the years of the shortsale. This is going to last another 3 years minimum in the residential sector without intervention.

There are a ton of things to consider... Is there a such thing as a jobless recovery? Is unemployment going to go on the rise again? not to mention the commercial market is just getting started. How will that effect the economy? Will there be another extension to the tax credit? Will they renew the debt relief act or expand on it? How long until interest rates rise? They cannot remain artificially low forever. When will inflation bear its ugly face? The list goes on...I think we are still on uncertain ground. I wish I had a crystal ball.

Now that I have made it sound like the world will end in 2012... with hardship comes opportunity. First time buyers can actually afford to buy and are given incentive to do so through tax credits and low interest rates. Investors can purchase properties that cash flow and the ones with cash are really making out.

Interesting times.

[Redlinerobert]

Interesting times indeed.  The summit was great.  Saw some old friends and made some new ones.

I dont think we'll start to see a normal market for another 3 years.  Many of the outsourcing companies are retooling to deal with short sales.  There's less of a loss to the lender and the credit for the seller isnt killed.  The difference is that marketing will now be bottome up (client) rather than top down (asset manager).

It's going to be quite the ride for the next few years.

[South FLA]

I am currently in the process of purchasing single family homes and town houses from county auctions at about 40-60% below 2006 values in Palm Beach and Martin County Florida for courthouse auctions.   

I am in with a small group of investors and so far the turn around time is about 60-90 days on market, but I would say a large percentage of properties that are auctioned never meet the banks reserve!!!  It should be very disconcerning knowing that the banks are holding on to these properties...must be killing their balance sheets.  I am with Redline here I believe its at least 3 years in Florida before inventory is reasonable relative to sales, but if you have cash NOW and I repeat NOW NOW NOW is the time to buy.  I have friends of mine that are purchasing primary residences that were out of their ballpark for roughly 1/3 of the price, but financing is hard to come by.

[South FLA]

Real estate is ok if you have deep enough pockets to handle the carrying costs over a period of time ( Hoa, property taxes, maintenance,HO insurance, county club dues and required costs like the grille)for an investment property or second home. It's a good time to buy for your primary residence, providing you don't take a bath on your existing home.

As far as refinance, great idea if you owe less than than what the new appraisal and an 80% lTV is important to avoid PMI, don't forget closing costs.

Personally I always preferred stocks, many have had giant gains over the last year, plus it's liquid and no carrying costs except a buy and sell commission, which you are going to have with real estate too, unless you are your own broker and double dip it.

Just my opinion, to each their own.

I am primarily in securities, but as you stated early if you have the cash the ROI in real estate in the next coming years may surprise you.

[b.Lee]

I take it you aren't doing too shabby for yourself then even in a down real estate market.

[gobig]

In a down market or in a booming market someone is always making money.