Spring Buying Season

[donaldduckmoore]

sdnerd, I totally agree with your points.

DWCAP, you are asking a very interesting question that I wanted to ask for a long time.

SDR, sdr, rustico and others, what kind of sellers are there to list their houses? Are they desparate? Moving out of state or other reasons?

[gn]

gn, can you elaborate this "the rental supply is artificially low"? People want to hold on to their rental properties because they want to jack up the rent? Don't get it?

There are many houses financed by exotic mortgages (ARMs). The owners of these houses are likely to be foreclosed by the lenders. Eventually, most of these houses will be taken back by the lenders & put on the market.

Many of the buyers of the REOs are investors who buy because the rental incomes is higher than the cost of ownership. All of this effectively increases the rental supply.

[gn]

gn, can you elaborate this "the rental supply is artificially low"? People want to hold on to their rental properties because they want to jack up the rent? Don't get it?

There are many houses financed by exotic mortgages (ARMs). The owners of these houses are likely to be foreclosed by the lenders. Eventually, most of these houses will be taken back by the lenders & put on the market.

Many of the buyers of the REOs are investors who buy because the rental incomes is higher than the cost of ownership. All of this effectively increases the rental supply.

[gn]

gn, can you elaborate this "the rental supply is artificially low"? People want to hold on to their rental properties because they want to jack up the rent? Don't get it?

There are many houses financed by exotic mortgages (ARMs). The owners of these houses are likely to be foreclosed by the lenders. Eventually, most of these houses will be taken back by the lenders & put on the market.

Many of the buyers of the REOs are investors who buy because the rental incomes is higher than the cost of ownership. All of this effectively increases the rental supply.

[gn]

gn, can you elaborate this "the rental supply is artificially low"? People want to hold on to their rental properties because they want to jack up the rent? Don't get it?

There are many houses financed by exotic mortgages (ARMs). The owners of these houses are likely to be foreclosed by the lenders. Eventually, most of these houses will be taken back by the lenders & put on the market.

Many of the buyers of the REOs are investors who buy because the rental incomes is higher than the cost of ownership. All of this effectively increases the rental supply.

[gn]

gn, can you elaborate this "the rental supply is artificially low"? People want to hold on to their rental properties because they want to jack up the rent? Don't get it?

There are many houses financed by exotic mortgages (ARMs). The owners of these houses are likely to be foreclosed by the lenders. Eventually, most of these houses will be taken back by the lenders & put on the market.

Many of the buyers of the REOs are investors who buy because the rental incomes is higher than the cost of ownership. All of this effectively increases the rental supply.

[(former)FormerSanDiegan]

Who, as an investor, would put 20% down for an investment property?

Historically (prior to early 2000’s), investment property required at least 20% down. In fact often it was 25% or 30% down payment required.

Also, to get the best terms (lower rates, no PMI) requires at least 20% down. Better loan terms means better cash flow.
Most real long-term, buy-and-hold investors put at least 20% down. Those who put down less would likely include flippers and speculators.

[(former)FormerSanDiegan]

Who, as an investor, would put 20% down for an investment property?

Historically (prior to early 2000’s), investment property required at least 20% down. In fact often it was 25% or 30% down payment required.

Also, to get the best terms (lower rates, no PMI) requires at least 20% down. Better loan terms means better cash flow.
Most real long-term, buy-and-hold investors put at least 20% down. Those who put down less would likely include flippers and speculators.

[(former)FormerSanDiegan]

Who, as an investor, would put 20% down for an investment property?

Historically (prior to early 2000’s), investment property required at least 20% down. In fact often it was 25% or 30% down payment required.

Also, to get the best terms (lower rates, no PMI) requires at least 20% down. Better loan terms means better cash flow.
Most real long-term, buy-and-hold investors put at least 20% down. Those who put down less would likely include flippers and speculators.

[(former)FormerSanDiegan]

Who, as an investor, would put 20% down for an investment property?

Historically (prior to early 2000’s), investment property required at least 20% down. In fact often it was 25% or 30% down payment required.

Also, to get the best terms (lower rates, no PMI) requires at least 20% down. Better loan terms means better cash flow.
Most real long-term, buy-and-hold investors put at least 20% down. Those who put down less would likely include flippers and speculators.

[(former)FormerSanDiegan]

Who, as an investor, would put 20% down for an investment property?

Historically (prior to early 2000’s), investment property required at least 20% down. In fact often it was 25% or 30% down payment required.

Also, to get the best terms (lower rates, no PMI) requires at least 20% down. Better loan terms means better cash flow.
Most real long-term, buy-and-hold investors put at least 20% down. Those who put down less would likely include flippers and speculators.

[donaldduckmoore]

Thanks FormerSD, I learnt more.

gn, so you mean high forclosure activity artificially suppresses the rental supply in MM now? You tend to assume that MM is a big rental market. I am not sure if MM is a big rental market or area in san diego but when you look at the back issues of san diego readers and even in craigslist, MM always and most of the time does not have a lot of rental properties to rent, unlike La Jolla and UTC. I have been keeping track of the readers since 2000 because I kept looking for rental since 1998 but I didn’t see a lot of listings in MM. That tells me that if MM is a big rental market, then it must have its advantages to attract renters so that listings are not many. Or it may not be a big rental market. Next, you assume that people who buy REOs are investors. How can you tell and why. I am living in a house that I purchased as an REO property. In contrast, I think most of the REO buyers will live in the house. They buy now because they were suppressed back then by high price so that they could not afford to buy and they now saved enough and the price has gone down so that they buy. At least that is my case. I do not think that there are as many investors now as there were 2 years ago. It is because first, a lot of the flippers are gone because of the bust. Second, as formerSD mentioned, they need to put more downpayment and the interest rate would be higher. Third, lenders are more stringent these days to loan money to investors.

[donaldduckmoore]

Thanks FormerSD, I learnt more.

gn, so you mean high forclosure activity artificially suppresses the rental supply in MM now? You tend to assume that MM is a big rental market. I am not sure if MM is a big rental market or area in san diego but when you look at the back issues of san diego readers and even in craigslist, MM always and most of the time does not have a lot of rental properties to rent, unlike La Jolla and UTC. I have been keeping track of the readers since 2000 because I kept looking for rental since 1998 but I didn’t see a lot of listings in MM. That tells me that if MM is a big rental market, then it must have its advantages to attract renters so that listings are not many. Or it may not be a big rental market. Next, you assume that people who buy REOs are investors. How can you tell and why. I am living in a house that I purchased as an REO property. In contrast, I think most of the REO buyers will live in the house. They buy now because they were suppressed back then by high price so that they could not afford to buy and they now saved enough and the price has gone down so that they buy. At least that is my case. I do not think that there are as many investors now as there were 2 years ago. It is because first, a lot of the flippers are gone because of the bust. Second, as formerSD mentioned, they need to put more downpayment and the interest rate would be higher. Third, lenders are more stringent these days to loan money to investors.

[donaldduckmoore]

Thanks FormerSD, I learnt more.

gn, so you mean high forclosure activity artificially suppresses the rental supply in MM now? You tend to assume that MM is a big rental market. I am not sure if MM is a big rental market or area in san diego but when you look at the back issues of san diego readers and even in craigslist, MM always and most of the time does not have a lot of rental properties to rent, unlike La Jolla and UTC. I have been keeping track of the readers since 2000 because I kept looking for rental since 1998 but I didn’t see a lot of listings in MM. That tells me that if MM is a big rental market, then it must have its advantages to attract renters so that listings are not many. Or it may not be a big rental market. Next, you assume that people who buy REOs are investors. How can you tell and why. I am living in a house that I purchased as an REO property. In contrast, I think most of the REO buyers will live in the house. They buy now because they were suppressed back then by high price so that they could not afford to buy and they now saved enough and the price has gone down so that they buy. At least that is my case. I do not think that there are as many investors now as there were 2 years ago. It is because first, a lot of the flippers are gone because of the bust. Second, as formerSD mentioned, they need to put more downpayment and the interest rate would be higher. Third, lenders are more stringent these days to loan money to investors.

[donaldduckmoore]

Thanks FormerSD, I learnt more.

gn, so you mean high forclosure activity artificially suppresses the rental supply in MM now? You tend to assume that MM is a big rental market. I am not sure if MM is a big rental market or area in san diego but when you look at the back issues of san diego readers and even in craigslist, MM always and most of the time does not have a lot of rental properties to rent, unlike La Jolla and UTC. I have been keeping track of the readers since 2000 because I kept looking for rental since 1998 but I didn’t see a lot of listings in MM. That tells me that if MM is a big rental market, then it must have its advantages to attract renters so that listings are not many. Or it may not be a big rental market. Next, you assume that people who buy REOs are investors. How can you tell and why. I am living in a house that I purchased as an REO property. In contrast, I think most of the REO buyers will live in the house. They buy now because they were suppressed back then by high price so that they could not afford to buy and they now saved enough and the price has gone down so that they buy. At least that is my case. I do not think that there are as many investors now as there were 2 years ago. It is because first, a lot of the flippers are gone because of the bust. Second, as formerSD mentioned, they need to put more downpayment and the interest rate would be higher. Third, lenders are more stringent these days to loan money to investors.

[Author]

Posts