Yes, I know.. I will be fortunate if more than 20% of the people that see the topic headline actually clicks to read this article.  But hear me out.  In conjunction with our business in Mississippi and Florida, I have diversified my business plan back to my home state of New Jersey, specifically the New York City metro markets, both urban and suburbs. 

For the most part, a lot of New Jersey Real Estate maintained decent values thus far.  Of course, being the neighbor to NYC, the financial hub of the world spurns job growth.  Yes and no, depending on the industry.  Unless you have a lot of experience on Wall Street, don’t expect to come into investment banking.  Many other sectors are very strong, especially healthcare and education. 

In January 2005 a 2 family home in Clifton, NJ, a nice suburban town 11 miles west of New York City sold for $489,000 and had rental income of $2,400 total.  In fact, over 150 2 family homes were purchased in the same area for round about the same price.  Today we are picking them up for under $300,000 from banks and short sales.  Rental income on this same building is $2,600, and the potential for growth in Clifton, due to it’s possible high school expansion and proximity to the city, public transportation, and corporate headquarter locations, Clifton may be a nice area to buy multi-family. 

For homeowners, My most recent client is a 28 year old school teacher.  She lived with her parents since college and has been on a salary for over 5 years of $42,000 which escalated to $49,000.  She has saved quite a bit of money and is ready to but a “deal.”  Instead of going for a condo or single family home, she was adament about buying one of these 2 family homes.  We just contracted for a semi-updated 2 family home in a great neighborhood for $280,000.  Tenant is paying on one side $1,250 per month in a 2 bedroom 2 bath unit with finished attic.  The downstairs unit, a 2 bedroom 1 bath and finished basement is vacant, perfect for my client to live in.  Using FHA financing which requires 3% down payment, her total monthly payment including taxes/insurance came to $2,040.  My client now owns a 2 family home in a great area and less than 5 minutes to her job for $790 per month, approximately one week of pay from teaching. 

The reason I told my story on the teacher is that right now is an unprecedented time with low interest rates and very low housing prices.  It’s the best buyers market we will likely ever see.  People like my school teacher are in the driver seat to start their foundation in building wealth thru real estate, even if she doesn’t seem to think that way.  She just wants a home and worry about the future value later.  I think she will be surprised in 10 years when she will be 38 and have enough money saved and equity gained to have available investment options that I will try to get her to look at.

We are pleased to announce that starting in the last few months of 2008, we will be launching one of the most sophisticated and innovative real estate clubs in New Jersey.  Based out of Hoboken, the heart of the Gold Coast, we will focus on local real estate news, developments, market conditions, etc.  We will also be focusing on local and out of state investment opportunity for the novice or seasoned investor.

Our monthly meetings will be held at different locations, announced a month in advance.  We will have one keynote speaker who will provide information and tips on how to handle different aspects in the real estate industry.  Whether it be credit repair, Hoboken real estate, financing techniques, or anything else, you are promised to learn something new at every meeting we hold.

Our goal is to raise the bar in real estate education and promote good business practices to help every member continue their path to financial freedom.  Real Estate is the catalyst to wealth.  As a group, we can share our experiences and learn from your to create the strongest minds in the business. 

Leverage is key.  With your attendance and as a member of our group, we can expose and uncover deals that not one single individual can do on their own. 

Our first meeting will likely take place in November, 2008 at a location TBD.  You don’t want to miss out!

 CLICK HERE for our official website

A chart showing Freddie Mac stock values.

We all know that Fannie Mae and Freddie Mac are in some big trouble.  A loss in stock value by over 45% in less than a year is quite a sign that things are not that good for the mortgage giants, let alone this is the lowest they have been in 17 years.  To let those of you who don’t know who these entities are, Fannie and Freddie own or back over $5 trillion of mortgage loans.  Since only last summer, Fannie/Freddie lost a combined $12 billion.

Fannie Mae and Freddie Mac are virtually the only source for banks and home lenders to make their loans through.  Their ability to do so is critical to our housing market and for the sake of the U.S economy.  Some analysts say that if Fannie/Freddie took after Bear Stearns and crumbled, we would witness a housing crisis far worse than what we are seeing today.

I, however, am an optimist and I think no matter how bad it gets, Fannie and Freddie will be able to raise enough capital to stay afloat and the boost from the Fed will greatly help.  Unfortunately, it was Fannie/Freddie that is indirectly responsible for the subprime mess.  Allowing lenders to write their own guidelines, package and sell should have been thought out a little more.

CLICK HERE for our official website 

Many of you probably don’t realize that “The Golden Coast” is in…..New Jersey??  The Golden Coast consists of primarily 2 counties.  Hudson and Union County.  Most of the area borders the Hudson River and if Mickey Mantle were alive today I would say it is close enough to midtown Manhattan for him to throw a baseball at.  You can travel by PATH, NJ Transit, Bus, cab, and ferry to New York City.  Hoboken for instance is our primary market.  Many real estate professionals go into buyer acquisitions with a blind eye.  This is no walk in the park rural subdivision.  We’re talking New Jersey people.  Most of the new development that is reshaping the landscape in the area is built by purchasing real estate, destroying what is on it and building new.  You cannot get a sense of the market in condos by looking at what is next door.  You have to dig in the planning and zoning department.

On the southside of Hoboken, which is my favorite, you will find some of the country’s most unique area.  Bars, clubs, cafe’s, salons, and whatever else you could possibly need is right at your fingertips with pristine views of the Manhattan skyline, the most popular skyline in the world.  I love to look at new development out there but you have to be careful.  There is a lot to look at.  Particularly there is a condo building about a mile northwest of River St.  It offers beautiful views and phenomenal natural light.  I recently visited the building and casually spoke to residents.  I asked them if they were aware of the 19 story building that is breaking ground in the next couple of months. 

The location where this 19 story building is going will block all of the nice views on the eastern part of the building and block a lot of the natural sunlight. 

So when you are shopping in Hoboken, be sure you are with an agent that understands the market and knows the area.  Also it is important that they know what the future development options are. 

CLICK HERE for our official website 

Charlotte, North Carolina offers a variety of positive economic factors which make it one of our favorable real estate investment market.  Some recent statistics and accolades are as follows.

• Cost of living is 3% below the National Average.

• Median household income is 11.8% above the National Average.

• Real estate in Charlotte is 8.6% undervalued compared to national average.

• Ranked second in the nation for Economic Strength.

• Charlotte was ranked fifth in the nation as one of the Best Housing Markets.

• Ranked first in the nation for having the Most Educated Workforce.

  More than 80,000 people moved to the Charlotte area in 2006 alone.

• In May 2008, ranked as #1 place to live by Market-Watch.

I think I proved a point.  In Charlotte, the average sales price of a newer home is $119 per square foot.  Currently, we are able to achieve preconstruction pricing for approximately $100 per square foot which includes land acquisition. 

With Kannapolis only 15 miles away and with its plans for the state of the art $700 million BioTech Campus completed, there will plenty of opportunity for relocaters to find their new niche in today’s society.  While Mecklenburg County is one of the strongest in the Carolina’s, we anticipate strong growth for forseeable future.  Contact us for more info.

CLICK HERE for our official website 

Many speculators believe that the bottom is here and are convinced that prices are at the lowest level that they will decline to.  I have heard numerous media advertisements stating that the bottom is here and only a fool wouldn’t buy at this time.  They use the cliche, “Good investors make money in bad markets.”

Although we have seen a huge drop in values, I am wondering if, in fact, we are at the bottom.  One of my leading concerns is Fannie Mae and Freddie Mac.  Shares of the 2 mortgage giants plunged 60% just this year, according to CNN Money.  As long as Fannie and Freddie continue to raise capital, we should be ok, but the cost of raising money is getting expensive.  So I bring you some good news and bad news, with the bad news first.  The bad news is that if Fannie/Freddie cannot insure or purchase mortgages any longer, this will without question much further cripple the credit industry, far worse than what we have already seen.  The good news is that currently they are raising capital at a decent level and a government bailout is nowhere in sight, YET. 

With that said, let’s assume the worse.. Fannie/Freddie go out of business or at least come close.  This would constrict the credit markets and loans would be tougher to get than they are today, which would have an adverse affect on the housing market.  Values would slide even further than they have and what we have seen in the recent year will seem like a small hiccup in the industry.  On the flip side, as long as the two stay in business and can maintain their level of business, the housing crisis should have some hope of a sooner rather than later rebound.

CLICK HERE for our official website 

After a long awaited 7 months of “red tape” issues, the MDA is finally winding down on the first round. 

Gary Swoope of the MDA has been quoted as saying that he believes the programs following phases will come together much more rapidly.

The Mississippi Small Rental Assistance Program is a unique incentive, funded by $262 million to allow landlords of affordable rental property a massive rental subsidy on property that has a very fair “Average Market Rent” requirement that HUD has designated.

We have assisted over 30 applicants in the first round of this program and are happy to announce that those who have waited for the second round patiently shouldn’t be waiting much longer.

For a free consultation on the logistics of the program, please feel free to contact us direct. Although we have always made it a point in saying that the SRAP is NOT the only advantage in Mississippi rental property, we are finally pleased that it is in fact progressing.  Read the official media coverage here

As the Florida real estate market is just about as sellable as a deadly disease, seasoned investors are taking advantage of the massive amount of foreclosures, also known as REO’s that are so abundant.  While banks are desperate to get some capital and cash flow moving again, they are deeply discounting the notes owned by homeowners to about 30% of the purchase prices, some even better!  Some may think that you can pick up these REO’s and wholesale them or flip them for a quick profit……..Not so fast.  Unless you purchase a portfolio and achieve an even larger discount which is typically a bulk purchase bonus, your chances of wholesaling are slim at this point.  As more and more people move to FL, realtors will continue to steer them to the foreclosures offered by approved brokers on the MLS.  You may think that realtors will go for the higher dollar.  Sometimes yes, but as of today, realtors are starving, literally.  Even they are the victims of the market and are experiencing their own financial pain.  So, by offering a lower price, they can assure themselves that even if the potential buyer shops around, the selected realtor knows that they are within market with the demand from the buyer, hoping to get the buyer to contract. 

Investors with holding power are going to be the ones to succeed.  In fact, you don’t even need a whole lot of money.  Just good credit, a small down payment, and the patience to see the market turn around.  One thing I am convinced by is that SW Florida will be the first to rebound, moreso than Ocala, Miami, Ft. Lauderdale, etc….Whether you realize it or not, we are in a bad enough economy to justify the word “recession.”  Unemployment rates are climbing and employers know that they can pay less for people out of a job with the same experience.  My opinion is that income will remain historically lower than the recent years.  Home prices will need to remain affordable for years to come and the term “affordable housing” has never been so necessary.  SW Florida has waterfront property, beaches, islands, entertainment and everything else that Miami has without its glamour.  People relocating to Florida, including the baby boomers will continue to take advantage of what SW Florida has to offer, and its affordability which is back in full action where it needs to be.  That said, our economy will become stronger due to lower prices, lower rental rates, and cheaper seasonal values, this bringing in additional surges of tourists. 

As far as missing the boat, we have yet another adjustable rate boom coming up later this year and into early 2009.  You think you are missing the boat due to foreclosures being bought by numerous investors?  I don’t think so.  The opportunity will be here for the next year or so for you to start investing in the market.  We are in a sagging economy largely due to oil prices and the housing market.  Again, patience is needed, and if you can give yourself that, your are destined to succeed.

To sum it up, I have recently purchased a brand new never lived in home in Cape Coral, FL for $115,000.  It’s a 4 bed 2 bath home and over 2000 sq. ft. of living space.  I haven’t even closed on it and a property manager has a lease in place already for me at $1,000 per month.  I put 10% down which on this price is not bad, I pay all of my operating expenses and I am breaking even.  If I can do that for 5 years, I will be in good shape.  Imagine if I buy 10 of them and the market turns around by that time?  Golden opportunities are among us.  With insurance rates coming down this year, I expect next year to take in a positive cash flow on this property, and with the market seeing more and more purchases every day, I think the turnaround will be quicker than most.  The chance is here, the choice is yours.  We have a portfolio of REO’s from a well known bank, and we are also notified of their upcoming REO’s and status of foreclosure.  We can assist in working with you on expanding your portfolio with these doom and gloom, yet lucrative times. 

Go Zone & SRAP Duplexes:  $240,000 Land Included

We are currently constructing duplexes in Ocean Springs, a city just east of biloxi.  Our subdivision is south of Highway 90 and NOT in any floodzone.  We have engineered our duplexes to comply with SRAP requirements.  We offer the most competetive price in by far the BEST area of Ocean Springs.  Take a visit to see for yourself.  Visit us HERE to see our floorplans and renderings of the most unique duplex you will see.  We have recently introduced our townhouse style duplex ideal for the SRAP and any other investment objective you have.  We are certain that this will increase the maximum values and give you great options when you choose to sell in the future. 

Duplexes are engineered structurally to meet condo conversion standards so if  you choose to condo convert and sell each unit separately, this is a likely possibility for you.  Please don’t hesitate to contact us for information.

CLICK HERE for our official website 

It is my opinion that the Advisory Base Flood Elevation issued by FEMA is going to be adopted by the end of this year.  My opinion is supported by the link below.  I have gone back and forth with someone regarding the urgency of ABFE and the non-issue part in regards to the insurance effects.  It is also my opinion that there is a direct reason why the Mississippi Development Authority requires strict compliance with the ABFE for any state or government sponsored assistance programs.  See SRAP.  That reason is still unknown, however, it leads me to believe that due to the fact nothing is in writing in regards to homes under the ABFE being grandfathered into the flood policies, the MDA is simply being proactive in requiring this IN THE EVENT that this may or may not happen. 

Sure there are marketers out there pitching the Small Rental Assistance Program, and yes, some were misled by their builders that their homes were good for the program.  Here we are today and there are a lot of investors upset because they are now learning that their homes may not or will likely not qualify for the SRAP due to its slab elevation above sea level not to the standards of the ABFE. 

Say what you want about the likely adoption, insurance issues or non-issues, but my model and concept will never change until something or someone proves me wrong.  I am not doing rocket science here, nor do I think I am the only builder to have this belief.  This is my concept and we will stick to it.  Our new slab built homes will be landfilled with dozens of loads of dirt and with our 95% plus on the compaction rating, we will be to the minimal height of the ABFE.  We will also be meeting the full Wind-Resistive rating offering a substantial savings on your insurance.

It is not unusual for builders with reasons to disagree with me and back their own concepts in terms of sea level elevation…..Yeah…I can accept that. 

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