More Evidence of the Housing Recovery
How do stock market pro’s know the housing market is recovering? They look at stocks like Sherwin Williams (SHW) because share prices of companies that offer housing-related goods and services are “on a tear.”
According to Jeff Clark who writes the “Market Notes” for Dr. Steve Sjuggerud’s Daily Wealth blog:
“As today’s chart shows, there’s a safer way to bet on the housing boom… Sherwin Williams (SHW) is one of the world’s largest paint and coating producers. The stock is in a “slow and steady” uptrend. Its share price has more than doubled in the last 12 months. And it just reached a new all-time high.”
As the housing market is recovering, some investors are buying real property and some investors are buying housing-related stocks. It’s all good.
Smokers suck!
I don’t know why a landlord would put up with smokers.
Smokers cause huge damage to property and they stink the place up and scare away nice tenants.
I just got an apartment back that reeked. It took a full paint job and a ton of chemicals to finally make the apartment livable. We lost a couple weeks rent because we had to shut the apartment up and bomb it with anti-smoke concoctions, clean every square inch, and then air it out.
By the way, the lady that lived in that apartment, who repeatedly lied when we tried to find out who the smoker was after numerous complaints and notices, wanted her deposit back!
Luckily, we were able to save the carpet.
We have a little complex in escrow at the time of this writing, that is full of smokers. It’s nasty. We have a big job ahead of us. But we’ll be able to raise rents significantly just by getting rid of the smokers and the stench.
That’s what real estate agents call upside potential!
Professionalism
I ran into an old friend a few nights ago. His name is David Read and he’s the real estate broker that sold my son, Josh his first home. It was a view condo. Josh was 20 years old and I was a single mom going to school.
Dave treated us like we were special.
Josh made a bundle of money off of that first home. He lived in it for a couple of years, then he rented it out for a couple of years, then he renovated it and moved back in, then he sold it for a $65,000.00 profit.
It’s doubtful that Josh could have “saved” $65,000.00 in the same time period. Plus when you factor in the tax benefits and the benefits of having his tenants pay his mortgage down, Josh figures that he pretty much lived in the condo for free for the years that he lived there.
The experience also made Josh a believer, so I was able to recruit him as my real estate investment partner and that has worked out pretty good too!
Dave got Josh off to a great start in life, by helping him buy that first home. And it wasn’t easy, because Josh was a 20 year old punk kid :), he was a commissioned salesman at Lifestyles 2000 Fitness at the time, and Dave had to work hard to find Josh that first loan.
Here’s what I learned from Dave’s professionalism and kindness:
1. Show up at the close (or go over the HUDs in detail beforehand so your clients know what to expect when they sit down to sign hundreds of pages).
2. Make your clients feel special.
3. Solve problems.
Not necessarily in that order.
Fannie Mae Expands Investor Financing Options
Hey real estate investors…have you ever wondered when your bailout would come along? Well this may help out:
“Fannie Mae recently announced expansion of it’s Homepath Mortgage product that provides home buyers and investors financing for the purchase of Fannie Mae-owned properties.
The new product will allow eligible individual and LLC borrowers to finance up to 20 properties using the Homepath Mortgage. NAR has long called for expansion of financing opportunities for investors as a way to increase the absorbtion of REO properties. Fannie Mae will offer flexible lending terms and will not require appraisals of the properties.
Visit Homepath.com for more information on the program and participating lenders.”
Thanks to the National Association of Realtors for this heads-up and for their smart advocacy.
How to Add an Extra $1 Million to Your Retirement Plan
If you would like to add an extra $1 Million to your retirement plan, start today. Buy one investment property: a house, a duplex, a 4-plex, etc. Just start. Start with one. Next year add another one. Add another one on year three.
If you’re crazy like me, keep adding.
(I acquired 92 units because I have the greatest ever handymen, and I didn’t want them to find a new client. I wanted to keep them busy. They just kept renovating themselves out of a job as we added each new property…until we had/have almost no service requests. True story. My Mom finally asked me, “How many units are enough?” I told her I never thought of it like that, I was just trying to keep Allen and Andy busy!)
The more units you acquire, the easier it gets. You develop an “economy of scale” and your great helpers (handymen, landscapers, janitorial crew, bookkeeper, etc.) start to run like a watch. I know you don’t believe me about this, yet. But eventually you will. (You can always hire the management out if you don’t find the game as exciting as I do.)
Interest rates are at an all time low. Get out there, take a risk and add just one unit to your assets this year. Then rinse and repeat next year.
Read the full CNN Money article here.
Happy investing, and happy retirement!
“U.S. Housing is the Next Gold”
Dr. Steve Sjuggerud says that real assets are better than gold now. As real estate investors, we already know that. But now the cat is out of the bag! Read his blog post to get the scoop.
More Good News for Landlords
This great new info-graphic from our friends at The KCM Blog shows visually that landlords are getting special again.
100% of markets tracked saw an increase in rents this quarter.
As landlords, we go through periods where we don’t feel very special (the recent recessionary years come to mind).
And then we have periods when we feel very special…when rents are rising and units fill fast (and banks lend us money)!
I signed leases with highest-ever rents on 6 different properties in the past month – both homes and apartments.
There were feeding-frenzies with multiple applicants on each of those properties. The feeding-frenzies repeated even though I made pretty big rent increases on all the homes and apartments that turned over.
Several times I had to take the ads down within 24-48 hours of posting to get the phone to quit ringing.
I figured the rents must be too low.
Each time the feeding-frenzie happened, I re-researched the market and raised the rents again.
This is a great problem 🙂
Are we at the bottom yet?
Read this interesting Barrons article from a real estate investor’s point of view. Investors want to buy at the bottom and hold for the rocket ride. We all suffer from that delicious fantasy. We all have sad stories of buying too late and selling too soon. But fantasy is “imagination unrestricted by reality.” So, rub your eyes and pay close attention to all the recovery indicators in the real estate market.
The Donald Loves Real Estate
Donald TrumpThe bottom line is I love real estate. I like it because I think you are going to have massive inflation at some point, and to me real estate is a much better hedge against inflation than gold, which you can't touch.