The Tides of Change in Our Real Estate Market
Posted: August 21st, 2007
Category: real estate news
Many years ago an Irishman named Sean Lemass coined the phrase “a rising tide lifts all boats”. This phrase is often used to describe the effect on the economy when it is stimulated by using tax cuts, low interest rates, and by creating policies that generally spur the growth of that economy. There are many sectors that make up the overall economy in the and it is infrequent that all of them are rising or falling at the same time. These sectors are closely monitored by governmental agencies to maintain a certain level of stabilization and by independent companies and individuals to ascertain how to profit from the movement of these sectors.
If we accept that a rising tide lifts all boats, it is easily assumable that a falling tide would ground some boats. When a grounded boat is observed by onlookers, many individuals would say that boat should have never been moored there in the first place. Other individuals would look at a grounded boat and determine a way to profit from the situation. The current residential inventory in the Atlanta area has some grounded “boats”, meaning distressed properties in it and other properties that are quickly heading for a distressed status. The term distressed properties does not only apply to properties that are in a state of ill repair but also applies to properties where the owners have maintained the properties but currently find themselves in bad financial waters.
There are more properties for sale in the Atlanta market now than there have been at previous points this year. Some sellers are trying to get out of houses that they can no longer comfortably afford, while others are trying to capture some profit from the growth in value of their property over the last several years. There are also numerous residential builders in the Atlanta area that are carrying more inventory than they are comfortable with. They’re potential profits are decreasing daily because of the overall cost of maintaining the expenses related to their inventory and they are making deals today that they would not have considered earlier this year. The market is becoming increasingly more fertile with deals for savvy investors in real estate.
Investors of residential property have the ability to make higher profits on their capital in times when the inventory of properties is at a high level. They realize that some of the properties will be sold at distressed levels and sift through the inventory to find the deals with the best rate of return. Many of these investors turn to the local real estate professionals to help them gather a list of potential properties to look at and to help determine the value of an individual property based on today’s market. Many real estate professionals accumulate contacts with bankers, mortgage agents, and attorneys, and in doing so often obtain knowledge of distressed properties prior to the general public. When these contacts have a property that is distressed or is becoming distressed, they will reach out to the real estate professionals to determine if they know of an investor that is capable of quickly making a purchase on a distressed property. In many cases the agents have a limited amount of time to review the potential property and to determine if they have an investor who would be interested.
To obtain information on distressed properties in your area, contact a local full service real estate professional and provided them with a list of the prerequisite criteria that you require to invest in real estate. The agent will conduct research based on your criteria and will contact you with a list of potential properties. This service is conducted without a fee attached so you have nothing to lose other than the chance of making a great investment.
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