While the rest of the nation mourns the difficulties of the real estate market, we can, as smart investors look at this time as a great opportunity to buy discounted properties and promote great interest in the apartment market to our potential private investors. We know that this is a bad time for many right now, but one of the best ways we can help this economy back to it’s feet is by infusing private capital into the real estate market and stimulating faith back into real estate as an investment vehicle. Without a doubt now is the time to invest in real estate! My mother always liked a good sale and American property is on sale! So here goes the top ten reasons why this is an awesome time to invest in multi-family apartments…
- Passive investors still do not have faith in the stock market, they no longer believe that while they sleep their money will make 12% like they did when I started buying real estate in 2006. This leaves real estate as one of the best possible places to invest in, especially cash flowing apartment complexes.
- If you are raising private money you control the investment, thus people will want to be involved in that controlled investment. If they trust you, if you give them a great return they will want to invest with you. Investors have less options right now so you are in a position to facilitate their investment needs, you are offering a great opportunity.
- Although there is still financing available, sellers think that financing is very tough so they are far more likely to be more flexible with special terms to compensate and make sure the deal gets closed. You are far more likely than ever to receive seller financing, seller seconds and cash back at closing for repairs. (Of course you need to ask for these terms).
- Local banks, credit unions, insurance companies and hedge funds are still taking on commercial loans. Multi family apartment complexes are getting the best loans available as they are considered the strongest sector of the market.
- Banks need to loan money in order to stay in business so those banks who are not lending right at this moment will soon be lending and the first area they will open up loans to will be cash flowing income producing properties that people need to live in. (Retail, office and development loans are the loans that are still harder to come by.)
- Because there is a national scare of large proportion many sellers are convinced that they have to get out of their properties for lack of understanding the true picture. Let’s help them out!
- There are many owners of property who are hurt in other areas of the markets because of their divesting, so they will be forced to sell their income producing properties to keep other parts of their business alive.
- Creative financing is going to be a real winning strategy moving forward. Combining different strategies with loan assumptions or first mortgages will be a winning combination. Banks are some of the most motivated sellers out there and are willing to be creative. Especially right now as we near the end of the year and they want to get those bad assets or “REO’s” off their books.
- There is a large amount of foreclosures in the market place and deals are everywhere even in markets that were originally over priced and previously difficult to get into.
- This is the first time ever some of us can finally find deals in our own back yard!!!! Value plays abound, look for ways to create more value in a property by decreasing expenses, and increasing income.
The stock market is still full of uncertainty for the passive private investor, so income producing real estate is really attractive to that investor. Remember Stocks can go to zero with no income, real estate multi-family has income and never goes to zero. Those that are prudent now will make a fortune in the future. You should feel fortunate that you recognize this time as a great time to invest in real estate.
Yes this is a tough time for the country, but this is Millionaire-Maker time for us, it is easy to get trapped into feeling nervous about the market, because bad news about foreclosures and real estate and the state of lending is everywhere, but take a moment and think about what we have just talked about. Think for yourself, if you were a bank or a private investor where would you put your money when people can no longer buy homes for themselves? APARTMENTS OF COURSE!
All the best!
Your Mentor – Sue Nelson
Sue a mom of three, starting as a struggling art teacher in a CT local high school. Sue Nelson began investing in real estate to provide a better life and security for her and her family. She realized she had a lot of catching up to do and was attracted to the big profits that could be realized quickly in commercial real estate. Sue quickly discovered and created little used techniques that allowed her to take control over many commercial properties. Today she and her partners own over 1500 commercial units and now one of the worlds leading experts on Commercial Real Estate. Sue Nelson is a regular guest speaker at CT REIA. Go here for the current list of upcoming real estate investing seminars in Connecticut.