Greg Traub

Sure I can comment on that statement.

The things mentioned are true and they are bad for the market. However it's the same stuff we've been hearing for the past 2 years now. ARM's resetting, and lenders staying away from subprime....Lenders haven't touched "subprime" in years, ARM's have been re-setting for years and will continue to. With the exception of the fact that like broker dave said, all these lenders are actively starting to modify every loan that looks like it could be in risk...turning those ARMS into fixed rates owners can afford.

Will prices keep heading south for the next few months, YES and no. The only two factors you have to look at to see where prices are being pushed are supply (number of homes for sale) and Demand (number of people buying). In the bigger picture, talking about the Orange and Seminole County area's together there are still 10-14K more homes on the market than there would be in a stable market. And there are a bit over 1300 people buying every month, you can do the math from there.

It's my opinion that he past 12 months was probably the worst part of the price drops. Banks were slowly having to foreclose and got more and more cash strapped, dropping their REO homes prices quicker and quicker to raise capital they desperately needed. Bringing the whole market down with them. Now they are getting bailed out, and actively trying to stave off foreclosures they could have avoided, you actually aren't seeing banks accept offer for .60 on the dollar....maybe from peak prices, but those prices are irrelevant anyway, they are looking for as close to TODAY"S price as possible and now have some breathing room to wait for them. Nonetheless Prices are still being pressured downward due to high inventory. On the smaller picture, locally, there are area's with a very good balance of inventory and demand. Particularly area's that weren't overbuilt during the boom, with great schools, and prices already inline with incomes. Many right here in Orlando, that I don't see further price declines likely at all.

On the bright side, the demand part of the equation is coming back pretty well. Sept of 07 barely 900 homes sold, Sept 08 up to 1300+, Oct 07 - 1090 homes sold, oct 08, even with ALL the news coming out about a bad economy, stock prices PLUMMETING and bailouts Galore, buyers were still up to 1199 sold. There is a pent up demand out there, once something breaks in buyers minds the sales numbers will grow and the inventory will be eaten up quickly. When that happens who knows. What I do know that is a TON of the inventory out there is "bad", bad condition and/or bad location. Those properties will be the last to go.

So if you were looking for a place to call home for the next 5+ years, NOW is the time to buy. Not because you will make a ton of money when the market snaps back (I don't think a "snap" will happen anyway), but because you actually have the choices out there right now, and usually some time to think over the choice, to pick your HOME. Whether it be the perfectly manicured, upgraded, and upkept house you can move right into, or the run down foreclosure at a great price you can put some elbow grease into.....You have choices.

(though on the run down house end, you have even more the luxury of waiting for the one in the best location)

Plus prices in some area's have gotten so low, investors can actually cashflow rental properties they can buy with a decent amount of $ down. Once real investors start picking off the low lying fruit you'll see a solid bottom in prices. And that's already starting to happen. I've read several articles of "vulture funds" coming together to start buying rental properties. People aren't making money in stocks or bonds anymore, some will go back to owning Real Estate.

You may see prices drop another few % over the next 2 years, but in my opinion, from what I see in the market the drops probably won't be big enough to worry about, and won't be so severe you won't make up the appreciation over the next 3-4 years. Just don't buy more than you can afford!

Anyway, that's my biased "Rosed colored glasses" view of things. If Unemployment hits 15% or the banks start failing again, all bets are off. Nothing is 100% a sure thing. Just telling it the way I see it. - Fri Nov 14 2008, 16:12

The Sanctuary was just built at an un-opportune time, meaning the developer sold them all at the peak of the market to many investors or people that were stretching themselves in the first place. With the market downturn/crash alot of those owners are now up-side-down and are trying to sell for one reason or another without luck. As a result there are many foreclosures and short-sales going on. This kind of activity does tend to scare some people.

It is still a very nice community (I personally like Live Oak a little better though), good schools, low crime, new construction. It was just one of those communities hit a little harder than others. I personally think it would be a great time to buy in there because as soon as all those foreclosures have worked their way through the market (which they certainly will at the prices they are approaching), the neighborhood will come back, and you would have bought while the prices where still depressed below fair market value because of the current conditions.

I've seen alot of interest in The Sanctuary and Live Oak in just the past few months and many of those foreclosures/short sales are selling relatively quickly, a few with multiple offers. I'm sure there will be deals to be found around Oviedo for the next 6 months or so, but I'd certainly be kicking myself if I missed a good foreclosure deal and no more where coming on the market in the area I liked.

Just my two cents. - Tue Jun 24 2008, 06:41

Here's a straight foward answer for you. Yes it's better for you to sell now rather than a year from now.

It may be EASIER to sell your home later, but in 12 months it's also going to be worth less. I said it last year to my sellers and I think it will still be true this year. With the current number of homes available for sale now, plus the number of homes actually being sold, plus the number of foreclosures on top of that that will continue to put hard pressure on prices downward, this will create a near certainty that prices will be lower next year....specifically talking about 32825, some area's are doing better. It may only be 5%-10% lower next year but all signs/statistics point to continued price declines in that area for at least the next year.

So you can either sell it now and compete with all those other homes out there (foreclosures, short sales, and the like) and sell for today's prices; Or sell next year when there will be fewer homes out there (let's hope) and fewer foreclosures to compete with.....but sell for next year's prices, which can be much less than this years. - Mon Nov 3 2008, 18:44

150K or less for a SFH in a decent rental area is tough, but can be found. Flips I think are still too risky in this market unless you find an amazing deal.
To answer your other questions.
1) Yes, but it depends on many factors of which I'm sure you know
2) I don't know enough about markets in other area's of FL to give you an accurate answer on that. Do I think Orlando is a good place to invest for the goals you stated, yes.
3) I actualy prefer east orlando for rental purposes...it just depends on where your located. There is a huge University in East Orlando that is keeping rental prices solid in the area's the students like. Waterford Lakes, Cypress Springs, some parts of Southern Oviedo, and the 32817 and 32826 zip code have a pretty low vacancy rate. But I also view foreclosures as a moderately good thing for rental investors, those foreclosures aren't going to be on the rental market at least until they sell. I have seen many many renters moving at all times of the year now just because the home they have been renting finally foreclosed and the banks kicked them out.

When investing, it all depends on the specific house in the specific area and the specific deal. What kind of experience do you have in property investing so far? - Sat Oct 11 2008, 09:55

Did you have him sign a satisfaction of lien? Do you have any proof it was paid in full? Have you simply asked him to sign any of these or is he refusing to do anything? He may have just never gotten around to satisfying the lien in public records.

If he's causing a problem you will most likely have to hire an attorney as this would be a legal issue. If his lien was file after the first mortgage holder that is foreclosing, he will most likely be wiped out anyway. - Sat Oct 11 2008, 09:24

Well Al, What does your agent say it's worth in such condition? Was it under priced at 495? overpriced, or priced right? What do the comps say, and what are your other options available in the neighborhood?

I think I was able to find the listing for the home you mentioned, and it clearly states "the listing price has been approved by the bank". This is a good sign in that the short sale process has progressed somewhat well so far, but may not be a good sign if we find out it's not worth 495K with all the damage. This would be where an experienced agent (in short sales) would be best able to help you negotiate the price below what the bank has already "approved"

Just a few of the things I would have to find out if it where me would be how long ago the bank had their BPO or appraisal done, what the condition of the property was in at that time, what the other offer on the table was (if possible), Which banks are involved in the short sale, etc, etc, etc..... You could expect at least a 2-4 week wait for a response from the bank assuming you put together a strong offer package (not just including the purchase offer but supporting documention for why the offer is what it is).
Since the property already has an accepted offer on it already though...you may just be plain out of luck. If the current offer is higher than yours will be the bank will accept that offer no matter how strongly you justify your price. If the current buyer doesn't know about the condition or just plain gets tired of waiting (which happens ALOT) they will drop out and you may become #1.

In short...it all depends. We'd need to spend way more time and gather way more information to render any kind of informed opinion on this particular case. - Tue Oct 7 2008, 07:52