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May 31

RECORD HIGH ASKING PRICES hit the market

By Carole Ellis | News

Homeowners are feeling good. Really good. In fact, homeowners looking to sell this summer are feeling so good about their home values that they are setting records when it comes to just how expensive they think their properties should be. According to May data from realtor.com, the past three months show higher asking prices on homes than the website has ever posted before. (N.B. Realtor.com started collecting such data in 2013.)

“The spring real estate market is coming in strong, just as we expected,” said Realtor.com chief economist Jonathan Snow. He noted that the median list price in May of $250,000 is nine percent higher than a year ago, and added, “Pent-up demand and low mortgage rates are driving consumers into the market with urgency.” Thanks to limited supply in many markets, however, that urgency is just making sellers feel even better about demanding exactly what they feel their home is worth.

If you’re hoping to take advantage of these skyrocketing values, however, you should probably act fast. Smoke warned that while homes are currently moving off market after about two months (65 days, three fewer than in April), rising inventory levels in many markets are likely to cool things down – or at least level them off – in the coming months. At present, inventories are increasing (they were up four percent in May over month prior) but are still lower (also four percent) than they were a year ago.

Do you think that the time has come to list if you’re going to?

Thank you for reading the Bryan Ellis Investing Letter!

Your comments and questions are welcomed below.

May 30

TOP 3 TOWNS for real estate investors

By Carole Ellis | News

If you’re a real estate investor who likes to be where the action is, then you’ll want to check out our list of hottest cities for real estate investing activity for 2016. According to analysts, the things that make a city prime for fast flips and great profit margins this year will include good urban planning, a strong jobs market, solid inventory, and affordability. At this point in time, these three cities still meet these criteria but are also booming with real estate investor activity.

Denver

Thanks to booming new developments, despite being one of the hottest markets out there right now Denver still has somewhat affordable housing in addition to being full of opportunities for investors to fix and flip as well as rent, since the area boasts a thriving millennial population that may not want to buy even when the option is there. The Mile High City is known for having great transportation as well, with light rail and highway projects connecting area suburbs and housing booming along those lines well outside of the city limits.

Portland

At present, Portland is still the least expensive large city on the West Coast, but if it keeps up its recent astronomical growth it could overtake some of California’s metro areas in the next year or two. Thanks to large employers like NIKE, Inc. and Intel Corp. and plenty of new construction, Portland’s growth seems assured in 2016. However, some analysts say that the city is entering a bubble, so be sure that your investing strategies here involve a quick turnaround and easy exit strategies.

Austin

It’s easy to peg Austin, Texas, as the third city on this list thanks to a huge tech-jobs market and growing start-up market as well. Residents can choose to rent or own thanks to a good and growing inventory of investor-owned properties as well as new developments, and the city’s reputation as a “west-coast city” off the coast is drawing new residents daily, particularly those who would like to live in the Golden State but simply cannot afford to do so.

Lesson Learned

Affordability, clear pathways of growth, and options are key to investing in “hot”  investor markets.

Point to Ponder

Would you get involved in any of these cities at this point in their growth, or do you prefer to act earlier in the timeline?

Thank you for reading REI Today!

Your comments and questions are welcomed below.

May 25

ZILLOW’S GUIDE to the presidential election

By Carole Ellis | News

It was only a matter of time before Zillow got in on the presidential race action, and everyone’s favorite online listing giant recently came out with a new poll asking experts how the November presidential election would affect their expectations for both the housing market and the national economy. While the poll is somewhat outdated at this point (don’t worry, there’s another one coming out in June) since at the time that the research was conducted, there was still a republican primary in effect, it’s still very interesting and useful to see how analysts say the election will affect their sentiments about housing and the economy.

For starters, the researchers said that both Donald Trump (now the presumptive republican nominee) and Bernie Sanders (still locked in a doomed-but-heated battle with democrat candidate Hilary Clinton) would “set back the housing recovery.” However, they tagged Clinton and republican Ohio governor John Kasich, who has since suspended his campaign, as preferable, but did not give out ringing endorsements. Hilary received a “neutral” rating on the economy, and Kasich did get all “positives” on economy, home values, and housing finance reform, but the panel declined to say much about these ratings other than that they felt Kasich and Clinton were more “centrist” and therefore more predictable than Trump and Sanders.

This brings to point a very important aspect of surveying any panel of economists: they like predictability. After all, how can you make economic predictions if you have factors (like Trump and Sanders) that are not obeying the conventional (or in Sanders’ case, even discernible) rules? You can’t, and that’s bad for predictions, not necessarily bad for housing or the economy. Just bear it in mind.

Also sign up for our Trump Tracker at www.rei.today/trumptracker! This is NOT political propaganda or a Trump rallying newsletter. It’s what he’s doing, the truth about what he’s saying, and why it should matter to YOUR investing business and how it affects your bottom line. Period. Stay informed on the race that has more to do with real estate investors and their success than any other presidential race in history with REI Today’s Trump Tracker at www.rei.today/trumptracker. You’ll know more than anyone else following the race, and you’ll be the first to be warned if things are about to get seriously hairy (hahahaha).

Thank you for reading REI Today!

Your comments and questions are welcomed below.

May 24

Trump says HE WOULD SELL to fund campaign

By Carole Ellis | News

Sign up for REI Today’s Trump Tracker at www.rei.today/TRUMPTRACKER! This is NOT political propaganda or a Trump rallying newsletter. It’s what he’s doing, the truth about what he’s saying, and why it should matter to YOUR investing business and how it affects your bottom line. Period. Stay informed on the race that has more to do with real estate investors and their success than any other presidential race in history with REI Today’s Trump Tracker at www.rei.today/trumptracker. You’ll know more than anyone else following the race, and you’ll be the first to be warned if things are about to get seriously hairy (hahahaha).

According to a recent interview on “Fox and Friends Weekend,” Donald Trump would consider selling a marquis property in order to raise the millions of dollars he needs to compete with the Clinton money machine in this year’s presidential race rather than get in bed with GOP “mega-donors.” Trump divulged this information in an interview wherein he speculated that GOP mega-donors don’t want to support him because he has made it clear he won’t allow their views to influence his policies. “These are people who won’t have access to the White House,” he said, adding, “I don’t want people telling me what to do.”

Trump suggested that he would far prefer to sell a building, which, could net him hundreds of millions if he sells off a marquis property like Trump Tower in New York City, even if he opted to sell at a discount in order to get fast cash. “I have the option,” he said, noting that he believes he could finance a billion-dollar presidential run on his own if he sold off the right real estate. Trump’s Big Apple real estate portfolio alone is presently valued in excess of $2 billion, although Forbes Magazine estimated recently that he would have to sell off more than one property if he wanted to finance fast, since according to Forbes Trump Tower in New York would go for about $630 million if Trump were motivated.

He also hasn’t scared off all the big donors, either. Despite Trump’s vows that he would not take policy advice from donors and some public “tiffs” with multibillionaire and long-time GOP donor Sheldon Adleson, Adelson recently said he would probably commit about $100 million to helping Trump win the presidency, although he’ll likely make those donations largely through SuperPACs and nonprofit organizations. In 2012, Adelson and his wife gave about $150 million to Mitt Romney and other GOP campaigns at various levels of government.

Sign up for the Trump Tracker at www.rei.today/TrumpTracker, and thank you for reading REI Today!

Your comments and questions are welcomed below.

May 24

3 FASTEST GROWING CITIES and how to make money there

By Carole Ellis | News

Certain cities are experiencing massive growth lately, and it shows no signs of stopping in the immediate future. However, as is the case with many episodes of fast growth, sometimes exponential improvement in an area can cause analysts to start warning that trouble could be on the horizon. Thanks to the U.S. Census, we’ve got information not just on the cities that are growing faster than everywhere else in the country, but we’ve got the details on what’s making that happen as well. Check out the list below and let us know what you think:

  1. Ankeny, Iowa
    Ankeny is a suburb of Des Moines and grew by 6.5 percent between July 2014 and July 2015. It is unique because it is the only one in the top 15 outside of the South or West.
  2. New Braunfels, Texas
    New Branfels is second to the the top among five Texas cities in the top 11 fastest-growing cities, and is just part of a much larger trend in the state of Texas. While many warn that the Texas economy’s dependence on oil could create a serious problem in the coming years, the state’s recent divergence into the IT industry and the traditional two-year lag on oil-related slowdowns could insulate the New Braunfels economy and probably will.

1.Georgetown, Texas
Georgetown’s big growth is likely related to its proximity to Austin, Texas, where technology, big oil, and major industry combine to create a hotbed of ingenuity and economic growth. Georgetown grew 7.8 percent between July 2014 and July 2015 and is likely to continue to climb over 2016.

Lesson Learned:

Knowing why cities are growing can help you decide whether or not you want to invest there.

Point to Ponder:

Would you invest in a city based on its growth in the past 12 months?

Thank you for reading REI Today!

Your comments and questions are welcomed below.

May 24

homebuyers: “we DON’T CARE about low interest anymore”

By Carole Ellis | News

Over the past few weeks, every new day has brought a new study indicating that buyers are not reacting quite as they should to fluctuations in interest rates. In fact, just a few weeks ago, mortgage applications barely budged despite interest rates hovering near three-year lows, and then when rates rose, applications declined but not nearly as much as many analysts expected. The reason could be that homebuyers just don’t care as much about interest rates as they used to, especially when they also have to consider generally higher prices in most desirable markets and additional affordability factors like higher insurance premiums and heavier closing costs and other regulatory factors.

Furthermore, buyers may just be getting immune to interest rate changes, since a lot of the “doom and gloom” predictions that interest rates would rise, price buyers out of the market, and lead to another housing crash remain largely unfounded. In fact, the Fed has predicted so many times that it would raise rates, then failed to do so, that when it actually did bump them up a measly 0.25 percent at the end of 2015, most buyers didn’t even react. Their response was validated when the Fed immediately went back to threatening to raise rates, then failing to do so, and even speculating about negative interest rates.

“Even though it’s a sellers’ market nationally, homeowners often have to make a leap of faith to list their homes because there may not be a more desirable home to move to,” explained Redfin chief economist Nela Richardson. She noted that many buyers are finding themselves in the uncomfortable position of having to take what they can get, while sellers are simply unwilling to list in the first place. The result is that interest rates are not engaging the market the way that they once would have.

Lesson Learned:

It’s very important to understand what motivates your target market and adjust your marketing and sales strategies to appeal to their actual desires and concerns.

Point to Ponder:

Will interest rates ever be a big motivator again?

Thank you for reading REI Today!

Your comments and questions are welcomed below.

May 24

The FIRST FULLY SOLAR community

By Carole Ellis | News

If you always wanted to live in a fully solar, massively health-conscious community but felt that nowhere was the right fit for you, then Babcock Ranch in Fort Myers, Florida could be the answer. The development, which ultimately will house nearly 20,000 homes, a downtown area, a wellness center, a café, restaurants, and outdoor outfitter shop as well as nearly 9,000 acres of green space and nature trails, is the brainchild of developer Syd Kitson, who purchased 18,000 acres for the development back in 2006. In 2009, the project stalled, but Kitson now predicts that the first-phase opening will happen in early 2017.

Phase 1 of the development will not only offer single-family and multifamily living options, but most of the nature trails, a large portion of mixed-use development, local entertainment options and, perhaps most importantly, fully sustainable solar power via Florida Power and Light’s Babcock Ranch Solar Energy Center. “Babcock Ranch will exemplify what it means to be a town of the future,” Kitson said recently, adding that his development will offer residents “a highly unique balance of the most technologically advanced infrastructure and amenities with ready access to a rich natural environment and a true sense of community.”

The initial development reveal took place on Earth Day (April 22) 2016, and Kitson has made great time with the development. He broke ground on the solar facility in October 2015 and began work on the actual housing development later the same year. Kitson dubbed his designers, architects, and planners “Town Makers,” observing that the group as a whole believes “life is too short and the earth is too precious for mediocrity.”

Point to Ponder

At this point in time, Babcock Ranch sounds like paradise. Do you think it will actually live up to Kitson’s vision?

Thank you for reading REI Today!

Your comments and questions are welcomed below.

May 20

could your website GET YOU SUED under the DISABILITIES ACT?

By Carole Ellis | News

You probably know that most commercial buildings must meet certain structural requirements so that they are handicapped-accessible in order to avoid lawsuits and penalties under the Americans with Disabilities Act. But did you know that your website could actually be in violation of this act as well? The U.S. Department of Justice recently issued regulations concerning website accessibility and required, among other things, that website content “accommodate people with vision, hearing, or other impairments.”

While the DOJ has yet to publish clear rules on the manner in which you must accommodate these individuals, plenty of entities are eagerly piling onto the regulations bandwagon in order to “help” you make sure your website is compliant. However, at this point in time, the DOJ has not even ruled on which websites will and will not be required to adjust their accessibility levels, although they have determined that brokers may be responsible for their agents’ websites as well as their own, and owners of shopping centers may be responsible for tenants’ websites as well as their own.

Generally speaking, bringing your website into line could, in the future, mean that you must provide closed-captioning on videos and explain graphical information in texts. Creating a “closed website” that only allows members or association use may enable you to avoid these adjustments, should you wish to do so, but that is unclear at this time as well.

Is your website compliant with the ADA today?

Thank you for reading REI Today!

Your comments and questions are welcomed below.

May 20

the no-new-building remodel that can TRIPLE YOUR MONEY

By Carole Ellis | News

If you know that your property would benefit from some more outdoor living space but you just don’t have anywhere to put it, then before you give up, look up. The new “must-have” remodel for 2016 could be just waiting “up on the roof” for you in your home, and it could come with a pretty substantial payoff in terms of adding value to your property (and minimizing time on market) as well. According to John Burns Real Estate Consulting, not only are more and more homeowners expanding their square footage by adding rooftop decks to their homes, but builders report that buyers are far more likely to pay a premium for a structure that has such a deck, particularly in high-demand areas like California where there is not a lot of indoor or outdoor space except in the most opulent of neighborhoods.

In fact, according to one developer, the $50,000 addition of a 150-to-300-square-foot deck could add as much as $150,000 to a home’s value. “Given the views [in the area] it’s criminal not to have one,” he said. Buyers appear to agree, with about 75 percent of local homeowners opting to add rooftop decks to their modest (albeit quite expensive) homes in a development nestled against the San Jacinto mountains.

Historically, rooftop decks have represented a headache not worth having for homeowners since conventional wisdom warns that a flat roof is more susceptible to leaks. However, thanks to modern construction developments and far superior sealing-for-your-ceiling options to just a few years ago, this amenity is in demand and can put a property that would normally sell for less because exterior properties blocked its view in hot demand. Many developers say that most homeowners still will opt for a more conventional backyard deck if it’s an option, but if living space is densely packed, rooftop decks quickly become the rage.

Lesson Learned:

Don’t overlook a great value addition just because the location is not obvious. Be a problem-solver!

Point to Ponder:

Do you think a rooftop deck is worth the investment from a professional standpoint? How about a personal one?

Thank you for reading REI Today!

Your comments and questions are welcomed below.

 

May 17

TRUMP’S REAL ESTATE REPERCUSSIONS begin as owners dump properties

By Carole Ellis | News

Donald Trump has always been an outspoken sort of guy, but when he was known mainly for being rich and the star of multiple reality television competitions, the residents of his many buildings didn’t seem to mind so much what he was up to on the airwaves. These days, however, thanks to the Donald’s presidential run as the presumptive republican candidate, at least one resident of a luxurious apartment development called Trump Palace is calling it quits, and he’s willing to take a loss on his property to do so fast. Keith Olbermann, a sports and news commentator, has lived in Trump Palace since 2007, when he purchased his three-bedroom, 2.5-bathroom apartment for $4.2 million. He’s listed it for $3.9 million, about a seven percent loss.

Trump is, not surprisingly, taking Olbermann’s exit from the building – and his public statements that Trump basically forced him to do it because the republican candidate is so embarrassing and disgusting to him – with his characteristic aggressive style. Olbermann wrote in a recent op-ed piece in the Washington Post that he can’t “see, hear, or say [Trump’s] name any longer without spitting” and added, “Frankly, I’m running out of Trump spit.” Trump responded, “Keith is a failed broadcaster and the people in the building couldn’t stand him. He has been fired from so many jobs and now he is in limbo.” Trump speculated that Olbermann is attempting to spin the sale of his apartment into publicity to keep himself relevant, and added, “When people find out he is leaving Trump Palace, prices will probably go up.”

Point to Ponder

Do you think that Trump’s willingness to say just about anything will serve him well in the presidential race? Do you think he’ll have a real estate career after 2016?

Thank you for reading REI Today!

Your comments and questions are welcomed below.