Tuesday, May 19, 2015

Home Prices Rising and How You Benefit

In a Wall Street Journal article (front-page) by Laura Kusisto, May 12, 2015 titled "Home Prices Start to Heat Up" we learn that home prices rose year-over-year in 148 out of 174 metro areas in the United States, as measured in the first quarter of 2015. Fifty-one of these metro areas increased by double digits.


There is no doubt that most U.S. markets, including essentially all the markets real estate investors are investing in, are on an upwards trajectory. (If you are not a real estate investor... you may want to take advantage of as many opportunities as you can to learn about this market and determine what might work for you as an investment in your future.) The reasons are many, including low interest rates and loans becoming even easier to obtain over the past year (and this trend continues). Buyers (no doubt) know that the low rates will not be there forever, and feel compelled to jump in. And they are doing just that. A better employment picture also helps.


Needless to say, the phenomenon of price appreciation by itself can create upwards price pressure, as buyers prefer jumping in sooner rather than later, to get a better price. As I have always discussed and predicted, retiring baby boomers are starting to be a major force in some of the sunbelt states as they seek homes for retirement in warmer climates and friendly tax situations.


For the investor, new and seasoned, what is happening now is not strong enough not to invest. Learning how to take advantage of all of this is optimal at this time. It is a reminder that buying with a fixed-rate 30-year loan that never changes with inflation - and I cannot emphasize that enough - is one of the best financial moves one can make for their financial future! The tenant and inflation will bring the loan balance down as the years go by. Home prices AND rent are NOT fixed, only the mortgage payments are (the loan balance is also fixed and in fact is paid a bit off each month, even nominally due to the amortization).


I will discuss this in greater detail as well as many other factors critical to our real estate investing strategies, during our ICG quarterly 1-Day Expo near SFO airport on Saturday May 30, 2015. We will have market teams from the best markets in the U.S. at the Expo with vendors present for one-on-one discussions. Lenders will tell us about the new loans we can get, including new loans for foreign investors and U.S. investors with over 10 homes. We will also have experts on insurance, credit optimization and repair, and overall financial planning. For more detail on these experts, visit us at ICG Real Estate Investments and click on the button about our upcoming event. To register you may email us at info@icgre.com, and mention where you saw this blog, to attend for free with two guests. If you would rather register through Eventbrite, feel free (although ticket price applies).


See you soon; I look forward to learning from our experts right along with you.

Tuesday, May 5, 2015

Financing Now Available for Foreigners And Americans with Over 10 Properties

There are lenders seizing an opportunity by operating outside of the restrictive FNMA guidelines. In the past year we have seen loans improving for foreigners. It started with 50% LTV (loan-to-value) loans and now loans are up to 65% LTV for foreigners. The minimum loan amount is $100,000. Interest rates are not far off from the excellent rates American investors can get – mostly in the five percentile. Sometimes with a long fixed rate period, perhaps just passing the six percentile.

Loans can be fixed for 5, 7 or 10 years (the latter ones touch a bit over 6% but the two former ones are well within 5%+). Americans can now also get 65% LTV loans with similar terms for properties between 10 and 20 (!). As we know, FNMA caps the number at 10, a restrictive barrier not enabling markets to fully engage investors. Will Bill Gates also be limited at 10 residential loans? Apparently yes, according to the FNMA guidelines.

In any case, having the ability to borrow at 65% LTV can enable a good contingent of veteran experienced investors, to continue investing and take advantage of the great rates prevailing in today’s markets. As someone who has seen rates be well in the teens, I can appreciate what it means to borrow on property number 16 at a rate that is a bit above 5%.

I am impressed with these advances. As a result I have invited the lender to speak at our quarterly ICG 1-Day Expo on Saturday May 30th. There will also be solid conventional lenders and loans featured prominently at the event.

In addition there will be experts to teach us critical issues for investors: Scott Gerlis Founder and CEO of SAG Credit Consultants will speak about  credit repair and enhancement and how to maximize everyone’s credit and avoid the pitfalls.  Lucian Ioja, Financial Designer with Integrity Wealth Management, a respected financial planner, will teach us the overall way to look at arranging and optimizing our finances, not just via real estate, to secure a powerful retirement and other goal accomplishment. Joyce Feldman, Founder and CEO of Joyce Feldman Insurance Company (Farmers Insurance) will teach us about how to use insurance correctly as the first and possibly the most important line in protecting our assets, common mistakes and how to avoid them, and a comprehensive look at our protection.

Needless to say, teams from the best markets in the United States will be there to update us on their marketplace, interact with us, and tell us about special deals in their markets. We have been holding these events for about 25 years now and I keep learning a lot during each and every event. Mention this blog post and you can attend free – just email us at info@icgre.com or call 415-927-7504.

Tuesday, April 7, 2015

First Quarter Real Estate 1-Day Expo a Success

Between the experts we brought in to speak in December to those that joined us for the 1-day expo we had on Saturday March 7, 2015, attendees are feeling the momentum of this year being a record breaker for real estate investment. In March we had fantastic speakers. We heard from Tom Anderson, one of the best-known experts on the subject of real estate investing via your IRA account. He taught us about what works and what doesn’t. There are many types of real estate we can purchase via our IRA accounts and the advantages were something you will want to learn more about, if you were not there. We are considering asking Tom and our other speakers to guest blog for us, so look for that.

In concert with Tom, we had invited Roger St. Pierre to tell us about getting loans for buying real estate via our IRA accounts. Roger taught us about special NON-RECOURSE loans and how they can enable us to infuse “safe leverage” into our IRA investing. Wow. Tom, like all of our speakers are always great at really spending the time and energy in what they deliver to educate.

Attorney Brett Lytle gave a spectacular lecture that had everyone at the edge of their seats about asset protection. Brett covered fine points and state-specific details which were of crucial importance to the attendees. Since the first wall of asset protection is good insurance, we are inviting Joyce Feldman, who has great experience insuring real estate investors, to our NEXT 1-Day Expo on Saturday May 30th.  We have various experts under consideration who will be joining Joy.

Getting updates from the market teams was fantastic as always. Things change consistently, and to have them there every quarter to let people know what is going on is critical. I have been producing this event for over 20 years now and I still learn every time.

We had lenders discuss the ever-changing new loan programs for investors. Since loan conditions are rapidly changing these days (getting better), including loans to foreigners, we will have expert lenders at the May 30th expo as well. Just the Q&A sessions and the audience engagement were in themselves incredibly instructive. What a great day!

Looking forward to seeing you on Saturday May 30th. To register please email us at info@icgre.com or call at 415-927-7504. Mention this blog and you can attend for free AND have your guests attend free as well.

Wednesday, March 4, 2015

New Homes Begin to Dominate Investor Purchases

Investors who have been buying older homes from bank foreclosures during the recession, are now realizing some of the benefits of buying new homes built this year, in 2015 direct from developers (or minimally a massive renovation - like new). The lower future incidence of repairs, the warranties, the potential developer giveaways--possible only in new home purchases (a builder can give the buyer a covered patio which may be a $6,000 option, but only costs the builder $2,000 to build) and the modern amenities and floor plans are starting to attract more investors.

Since buying homes is in its core a long term investment, starting with new homes is a great send-off with many extra years of performance available. Getting loans on new homes is usually one of the easiest procedures, and with today’s low rates, locking in a 30-year fixed rate loan on a brand-new home is an excellent “stake in the ground” for anyone’s future. Of course investors should not just blindly buy brand-new homes. The locations have to have the numbers – the right rents for the right prices.

There are some excellent markets providing very good numbers and cash flows in good areas.
For more information, you are invited to attend our quarterly ICG Real Estate 1-Day Expo this Saturday. You will not only meet teams frrm the most relevant markets and see the possibilities for yourself, but there will be expert speakers on important topics such as the new twists in Asset Protection (you must know about this), buying real estate from your Self-Directed IRA, and getting real estate financing for purchases from within your IRA.


There will be information for new investors and established investors on how to move forward powerfully. There will also be lenders to update us as to the ever-improving loan possibilities for investors (domestic and foreign), and lots of great Q&A and networking. The event is near the San Francisco Airport this Saturday, March 7th, from 10AM to 6:30PM. You may also register by emailing us at info@icgre.com or call us at 415-927-7504.

Tuesday, February 10, 2015

FNMA 3% Down Loans Are Back!

FNMA, (for those of you new to this blog, Investopedia.com sites FNMA is the acronym and the stock market symbol for the Federal National Mortgage Association, commonly called “Fannie Mae.” This government-sponsored enterprise provides liquidity for the U.S. mortgage market by guaranteeing and purchasing mortgages, indirectly enabling families to buy or rent homes through access to credit) perhaps in a bid to compete with the 3.5% FHA loans, has reinstituted its 3%-down (97% Loan to Value) loans.

The loans are primarily for new home buyers, with some limited provisions for refinancing of existing FNMA loans. The combination of these new super-low-down loans, coupled with the very low interest rates in the marketplace, AND the new government lowering of Private Mortgage Insurance (PMI) on low-down loans, combine to make buying homes much easier for new buyers.

What does this mean for investors? A lot! Not only is this loan likely to create extra demand and contribute to home price appreciation, but when an investor thinks of selling an investment home, the pool of ready willing and able buyers will have been greatly expanded. Great news for new home owners and real estate investors!

At our next 1-Day ICG Real Estate Expo on March 7th, we will have experts on the newest wrinkles in asset protection, how to use your IRA to buy real estate, and getting loans for IRA-bought real estate. In addition, there will be experts speaking  on the newest loans available (this keeps changing for the better!), as well as an array of experts, market teams, updates, learning and networking. Can’t wait. Call our office at 415-927-7504 or email us at info@icgre.com and mention this blog entry to attend free.
 

Wednesday, January 7, 2015

Price Gains Slowing; Markets May Stabilize

In a Wall Street Journal article from December 31, 2014 by Kathleen Madigan, it is mentioned that overall in the United States (as per the Case-Shiller 20 City Index) prices were up 4.6% from the previous year by the end of October 2014. The pace of growth has slowed from 4.8% in September and 10% in the first quarter. The article goes on to say this could indicate the markets are moving toward stabilization.

Understandably, in Florida there is likely to be more price appreciation, as the state as a whole reflects the recession effect due to the ultra-slow judicial foreclosure periods. All in all, however, it's definitely time to look to the stable markets with great economies and low unemployment. It is time for the classic long term hold of houses, where the tenant pays off the (very low) fixed-rate mortgage while inflation keeps eroding it.

No doubt newer homes will figure more prominently in 2015. The classic investment thesis holds strong in 2015 with an extra HUGE bonus: super low interest rates are still here - but many think they will vanish in the coming years.

Happy New Year!

Below is the article in its entirety for your review:

SLOWING PRICE GAINS SUGGEST STABLER MARKET

By Kathleen Madigan (WSJ)
Updated Dec. 31, 2014 12:41 a.m. ET

Yearly growth in home prices across the U.S. continued to moderate early in the fourth quarter, suggesting the housing market may be settling into a more sustainable recovery.

Prices nationwide increased 4.6% in the year ended in October, according to the Standard & Poor’s/Case-Shiller home-price report released Tuesday. That was down from 4.8% in September and a far cry from the 10%-plus gains in the first quarter. A 20-city measure more closely followed by economists increased 4.5% over the year in October, also down sharply from double-digit gains earlier in the year.

Demand for housing has slowed significantly in recent months despite stronger job growth, a rebound in consumer confidence and falling gasoline prices, which puts more money into consumers’ pockets. Sales of both new and existing homes fell in November. Yet the slowing trend is a positive for the 2015 housing outlook, say economists who follow the industry.

Price appreciation of about 5% is close to a sweet spot where more buyers are able to purchase a home and current owners accumulate housing wealth, but the market avoids a price bubble that could trigger a financial crisis, as happened in 2007.

“It’s a healthier market because first-time buyers feel more comfortable about coming in,” said Bill Banfield, vice president of capital markets at mortgage lender Quicken Loans, adding that the industry needs more first-time buyers to buy smaller homes that allow existing owners to move up into new construction or to an existing house that better suits their needs.

For 2014, however, first-time buyers accounted for only 29% of existing-home sales, according to data from the National Association of Realtors, much less than the historical norm of 40% for sales of primary residences.

Economists at IHS Global Insight agree slower price appreciation is a positive for the housing outlook. “Home appreciation at a reasonable pace makes homeownership an attainable dream,” said Stephanie Karol, a U.S. economist at IHS Global. A repeat of the double-digit growth seen in early 2014 “would risk producing a bubble,” she said.

But just as each real-estate market is local, she pointed out the Case-Shiller price index of 20 cities masks the individual pricing experience going on across the country.

“Prices are rising fastest in cities such as San Francisco where geographic or legal constraints limit new construction,” Ms. Karol said. Cities with fewer zoning laws and more space—such as Charlotte, N.C., and Phoenix—are seeing smaller price gains.

Still, the average home-price gain of about 5% is good, she said, and IHS Global is upbeat about home demand and prices in 2015. The forecasting firm projects home prices, as measured by an index compiled by the Federal Housing Finance Agency, will increase 5% over the course of next year and sales of new and existing homes will average 5.92 million, up from 2014’s current pace of about 5.3 million.

Here is a link to the Wall Street Journal U.S. Housing Market Tracker:
http://graphics.wsj.com/us-housing-market/


Tuesday, December 2, 2014

You Think You Can't Get Loans?




Many investors have almost given up on getting loans to buy investment real estate. It may be that their credit was ruined during the recession. It may be that they own over 10 properties and exceed the FNMA guidelines. Or, it may be that their income is not sufficient or their loan to income ratio doesn't work.

Nowadays, securing a loan from a lender is far more difficult and a lot of very good people get left out in the cold. However, there are alternatives. One such alternative is the Asset-based loan. This is a loan based on your stock portfolio (as a bonus your foreign friends can also get a loan against THEIR stock portfolio in 30 different stock markets worldwide).

At our ICG 1-Day Expo this Saturday, one of our expert speakers will be Mark McKay, who specializes in Asset-based loans.

Take a look at the descriptions of these loans by Mark:

SecureLoan™
Still the best and easiest way to finance your real estate investments.
·         Loan is leveraged against your stock/securities portfolio
·         Lowest interest rates in the nation
·         Not a margin loan and generally several percentage points lower than margin loans
·         Not credit score driven
·         No limit on number of properties owned
·         You maintain ownership of your stock/securities portfolio
·         You continue to receive all the dividends
·         Fast and easy processing – generally 2 or 3 weeks
·         So low doc almost NO DOC
·         Established as a line of credit, you only pay interest on what you use
·         Dual appreciation


Come hear Mark THIS SATURDAY near the San Francisco Airport (details at www.icgre.com/events). Send us an email at info@icgre.com and mention this blog and you and a guest can attend FREE.