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We’re in the homestretch folks- 2007 is coming to an end. We’ve gone from being told that "subprime is contained" to hearing that bailouts will save us.
What do you think? What topics and stories remain untold or "under-told"? We welcome your comments.
Every now and then I get an email from someone who wants to know if now is a good time to invest in short sales. Not only that, L forwards me a couple of the mountain of real estate guru spam a week he receives. These gurus are typically agents who can’t seem to make any money selling real estate themselves, so they make money telling you how to buy it. Most of what the gurus are hyping these days are foreclosures and short sales. [Short sales, for the uninitiated, are sales where the lender agrees to take less than what is owed on a home.]
In what is a rather unusual moment for me, I’m finding myself in agreement with Mark Bosworth, who owns a real estate investment and management firm in Phoenix.
Mark Bosworth is a self-described real estate expert and investor in Phoenix. His "Investor’s Corner" is found in the Arizona Republic every week. I tend to differ with his bullish approach to investing in the current market, but yesterday’s article in the Republic [No link available] made way too much sense not to share. Bosworth outlined what it takes to make money in short sales:
For those of you who are serious about a new job in short sales:
Learn how to convince a seller in a bad situation to walk away from their home for your benefit. Now get a financiallly savvy lender to accept less than they are owed. You must have substantial capital- even if your polished negotiation skills land you an unbelievably discounted price, you still need to write the check. You need to be an expert at project costing, great at major repairs, and have dirt cheap contacts for getting lots of work done fast. Any items you hire out mean less profit. Finally, you have to sell the property FAST for top dollar even in a buyer’s market.
The potential gain is marginal compared to the catastrophic loss if you miss your numbers and find surprises. If you have to discount the sale to avoid the all too common 6-12 month sales times in a buyer’s market, you are sunk.
