The real estate blog.

Real estate investors have a problem in that the general market is geared squarely toward the needs of the standard homebuyer; us investors often feel like square pegs trying to fit into round holes.

The relationship between investors and real estate agents is a weird one. I have a long-term relationship with an agent that’s based primarily on loyalty and trust; I know she’ll take care of me and get the details taken care of, and she knows I’ll be back. I don’t get a lot of useful advice and she never brings me a deal, but she helps make sure I get the work done. So, generally speaking, when I’m buying a property or looking for a tenant I’ll often work with her.

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So… you’ve done your time in the city…the big smoke as we Aussie’s call it, and you’re looking for the next step. Well, one of the biggest catch phrases around, along with the one of the most popular Australian real estate investment moves these days is the “sea change”.

The term “Sea Change” came about a few years back, giving a bankable “tag” to the thousands of people that each week move to coastal towns along the perimeter of this beautiful land. While it mainly refers to the older generation, younger investors are flocking to the beaches, east and west, north and south.

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Home Staging – the MUST HAVE marketing tool for your property

By Sveta Melchuk

MSN Encarta dictionary defines Home Staging as the act of “beautifying a home for sale: cleaning, repairing and updating the decor and furnishings of an older home to make it more attractive when shown to potential buyers.”

The concept dates from 1970s, when a California Realtor and decorator noticed that the properties she took the time to «stage» sold faster and for more money than the average. Today, it’s an important marketing/merchandising tool in the USA (and spreading to Canada from the West) for the Realtors and the home owners alike and it’s especially important in a slow market, where you need every advantage over your competition. TV shows, such as Designed to Sell and Flip that House demonstrate that a bit of effort and a small investment can transform a property and make a BIG difference at sale time!
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If your property is fresh in the market, an open house can be very important. You never know whom in your neighbourhood is looking to buy a home like yours.
There has been some instances where the actual buyer came from a Open House visit. Although this isn’t always the case.

In fact, most visitors who come to open houses rarely buy the house. A lot of them don’t even know the price of your home when they stop by to visit; they probably just followed an “Open House” sign, got curious and came in. It will be the agent’s job to quickly screen the visitors and to identify them as “Potential buyers” or “Lookers”. (Your listing agent should know how to do that)

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I’ve avoided blogging about this deal for fear of jinxing myself, but I’m close to completing a 1031 exchange that I initiated earlier in the year to comply with a New Year’s Resolution that I’d made to sell a high-end loft and trade it for a multi-family property w/ better income potential. �What is a 1031 Exchange?But now w/ all the work done and a closing set for Friday I think it’s safe to mention. �I learn something with every deal that I do. �Here’s a couple of challenges that popped up on this one. No�comps:�I’m buying an updated four-unit complex in the trendy Montrose section of Houston. �There basically are two types of properties that you find in the comps: teardowns and new construction. �The building that I’m buying was originally built in the ‘30s, but has been updated with new wood floors, central air conditioning, a raised outdoor deck, and a number of amenities that make it a rare building. �Which means: there’s nothing to compare it to.�Which in turn means: you have to trust your numbers because there’s really not much of a “market”.� Time pressures:�The sale side of the 1031 was triggered by my selling the property to the tenant who I was renting to. �This was fortuitous in that I avoided vacancy, sales commissions, and all of the other hassles and expenses that are associated w/ marketing a property, but it also happened a bit quicker than I had expected – which meant that �I needed to be expeditious in my search in order to identify a replacement property within the IRS mandated 45 day window.�But nothing like a deadline to keep you from getting paralyzed by the analysis.� Challenging negotiation:�The goal of a negotiation is to efficiently reach a wise agreement in an ethical way. �This is easies when there is some alignment of the goals of the two parties and they negotiate directly.�Well in this case the “alignment” part was potentially there.�But the other elements weren’t.�First: both the sellers and I were using agents – that in itself injects two additional degrees of separation into the negotiation, which makes effective communication more difficult.�Add to this the fact that the seller was not a single individual; the property was owned by a group of three physicians who had teamed up on the investment, and who, based on their disjointed and confusing responses, had conflicting agendas.�Messy.�Once I get this deal tied up I’ll write about how some of the Getting to Yes principles helped keep the deal from stalling.�

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The baton passes to EquityScout.com for this week’s Carnival of Real Estate Investing.�

The real estate investing muse must not have been in full swing this week and the carnival didn’t get a lot of submissions.� We’ve been having some beautiful spring weather here in Houston, so if other areas are getting a taste of this as well then perhaps it’s getting some bloggers away from the keyboard.� Not a bad thing, in my book.�

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I was meme tagged by Pat Kitano of Transparent RE.com. A meme [mem ] is described by the American Cultural Dictionary as “A unit of cultural information, such as a cultural practice or idea, that is transmitted verbally or by repeated action from one mind to another .”

Huh?� Well consider it sort of a virtual party game.� And this particular meme has instructions: tell five things about yourself that readers might not know, and pass the infection along by tagging five other Bloggers.�

Ok - I know that rule #1 of blogging is to keep it short - 250 words max.� But rules are made to be broken.� Here’s some thoughts on a whitepaper we’re working on here at EquityScout.com.� Skip this one if you’re looking for a short read…

For years Real Estate professionals are heard cries that the sky is falling – that the impending bursting of the real estate bubble along with advances in technology would soon make the profession obsolete.� But it’s been easy enough to disregard these predictions as alarmist exaggeration while the market zoomed along in the longest bull market in recent history.�

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As a native Oregonian, I have definitely seen big changes in the demograhics of people who live here and who ultimately end up buying homes here. I know… I’m not living in S. California where the demographic changes have been much more prevalent… but Oregon has seen its share of demographic changes in recent years.

Coming from the lending industry a little ways back (last year:)… I saw first hand the growth of home buying by minorities. In my neck of the woods, hispanics are an ever growing population and they have been buying homes at record paces.

So… why haven’t most mortgage brokers seen these changes and adapted to the market to capture more business from these minority buyers? Well… some have… and some haven’t.

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Us as real estate investors really need to get back to the basics and see real estate investing for what it is… and more importantly… WHAT IT IS NOT.

I was recently reading the RealEstateJournal and found a great article written by David Crook. This article isn’t the same ol’ “doom and gloom”… the real estate world is falling… type article. It is more of an article to help new real estate investors get grounded and to see what real estate investing is… and what it isn’t.

After reading the article I began to think… (I know, sometimes I get myself in trouble when I think

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