kelly Logsdon Rush_one 001 rvsd 8x10_web sizeRemember Kelly Logsdon Rush? Teacher of the Year and my very first Real Estate teacher? Kelly is back with a somewhat regular little segment here on CandysDirt.com called “Ask The Teach”. I know a thing or two about real estate, but Kelly knows about five trillion things, so much, in fact, that she teaches RE at Champion School of Real Estate. So I asked if she would be our go-to, all-knowing Real Estate Oz. This week’s question comes from Brad Boswell at Supreme Lending. It’s aimed at the real estate professional, because Kelly teaches a whole class in investment real estate. In fact, she recently helped me remodel an investment property. She’s a great go-to source for questions on RE investments, tenant & landlord issues, managers, HOAs, commission splits, dual agency, consumer rights, you name it, you can Ask The Teach!

Question:  As a guest speaker in your Real Estate Finance Class, I’ve heard you mention many times that it’s a good idea for Realtors to work with Investors as part of their clientele.  What are the advantages of working with investors?                  

Great question Brad! But before answering, may I ask a question? How many Realtors do you know that would give up one-quarter of their income today without a whimper?   None…right? Well that is exactly how much business realtors are losing month after month, year in and year out if they ignore the investor client. According to the 2013 NAR Investment and Vacation Home Buyers Survey, 24 percent of all residential properties sold in the US were purchased by investors and 49 percent of those investors paid cash for the property… sweet! Today, the average buyer of a primary residence will live in the property 9 years before selling compared to 6 years in 2007.  Successful investors tend to buy and sell multiple properties over the course of a year and most often work with the same real estate professional on every one of those deals. The agent has the opportunity to earn commissions on both sides… the buy side and the sell side of the transaction or the buy side and the lease side. JUST DO THE MATH! The money is a great motivation, but there are other advantages of working with investors. One huge perk I personally appreciate is developing ongoing relationships with the investors. It’s also exciting and challenging collaborating on the property’s redesign, upgrades, choice of materials, color schemes and all the other necessary pieces of the of crazy puzzle we call the rehab process. It’s a great feeling of accomplishment to help the client achieve their rehab objectives and their profit goals for the project. So who are these Investors?  Well, you might be surprised. According to the Survey here are the characteristics of the investor client:

  • Your investor’s median age is 45.
  • Your investor’s median annual income is $85,700.
  • Your investor’s property is approximately 21 miles from their primary resident.

Wait there’s more:

  • 48% are two earner households.
  • 47% are likely to buy another investment property in the next two years.
  • 58% purchased detached single-family properties.
  • 29% of the properties were 1,000-1,500 square feet.
  • 47% purchased their property through a real estate agent.

Rule #1 if you want to work with investors: Understand the investor mindset!!! And understand that this is a significant chunk of the real estate consumer audience. What does that tell consumers? This is your buying competing!  PS: Brad, the student’s just love the class when you are a guest speaker.

Lance Armstrong Lake Austin

We knew 2013 was a banner year for Dallas Realtors as our market pulled itself up by its bootstraps and posted post-recession growth that amazed even the most seasoned brokers. But according to research from the Real Estate Center at Texas A&M University, the market posted year-over-year numbers that showed Texas flexing its economic muscles like never before.

Numbers are up across most demographics, with condo sales, luxury sales, and investment properties getting snatched up at record paces.

“The Texas real estate market showed strength in sales volume and price all year long and the fourth quarter was no exception,” said Texas Association of Realtors chairman Dan Hatfield. “We’ve now seen year-over-year increases in both sales volume and price every quarter for more than two years. This makes it clear – demand for Texas homes is strong and enduring.”

We agree, as the Texas tech industry continues to boom in Austin, pushing up prices and demand reminiscent of the Bay Area’s unfettered growth. High salaries and limited inventories — the statewide numbers show a precipitous drop to a 3.6-month supply of homes (6.5 is recommended for balance between supply and demand) — have resulted in huge price increases. But, as Candy pointed out, not all growth is good for everyone. As prices increase, housing affordability decreases, pushing out lower wage earners.

But Austin’s growth isn’t isolated, as every metropolitan area in Texas posted sales volume and price increases in the fourth quarter of 2013. According to the report, 60,998 single-family homes were sold in the state during the fourth quarter — 6.78 percent more than fourth quarter 2012. Median home prices increased 8.48 percent from fourth quarter 2012 to $172,600, and the average home price was a whopping $226,216 — up 8.88 percent from Q4 2012.

Real Estate Center economist Jim Gaines Ph.D. explained: “One thing that is notable about the price increases seen in the fourth quarter is that they are relatively consistent across the state. Those increases are being seen in markets of every size, not just in the largest Texas markets, so that indicates broad-based appreciation for Texas real estate.”

“Demand for Texas homes in 2014 should continue, but it’s possible that a shortage of inventory could inhibit sales volumes,” Gaines added. “The steady price increases we’ve seen recently should help alleviate that, enticing more sellers into the market, but buyers should continue to expect to compete for desirable properties.”

Interesting outlook for 2014. What do you think? Will the growth price-wise lure more sellers to the market?

sb10065161a-004

First-time homebuyers are finding it harder and harder to get into their dream home.

The National Association of Realtors said that first-time homebuyers make up only 28 percent of the national housing market in a Jan. 28 new story, the lowest number since the organization started measuring the demographic in 2008. According to the NAR, first-time homebuyers typically make up about 40 percent of the market, but several factors are keeping them from purchasing a home, including higher competition for lower priced properties, which are being swept up by investors at increasingly high rates.

Cash purchases accounted for 42.1 percent of all U.S. home sales in December, up from 38.1 percent in November, and up from 18 percent a year prior, according to RealtyTrac.

Tight credit is also preventing younger home buyers from qualifying for a mortgage to buy a home, as mortgage lenders require higher down payments. FHA loans, which many first-time home buyers turn to for the low downpayment requirements, have seen their market share decrease recently after an increase in premiums and fees this year made them less attractive to some.

However, Fannie Mae and Freddie Mac are lending more to first-time buyers, according to a report from Inside Mortgage Finance. The share of financing for first-time home buyers by the mortgage giants reached 19.5 percent in December, up from 14.1 percent a year prior.

Dallas agents have noticed this trend, too. Keller Williams Urban agent Britt Lopez says that in 2012 and 2013, first-time homebuyers made a huge impact on the market, coming off the fence to buy properties in the $300K to $400K range. In those two years, first-timers made up about 60 percent of her client base.

“I believe that the improvement in our basic economy here in Dallas has been the catalyst for the influx of ready, willing, and able buyers into the market,” Lopez added. “I also think that the interest rates and mortgage requirements play a huge part in the buying temperature. Potential buyers pay very close attention to the media regarding mortgage statistics and real estate prices. If a threat of rising rates and prices looks imminent then they will rush to buy now.”

On the other hand, some buyers have been squirrelling away, renting to save up for a down payment, waiting for the perfect time and perfect house to make the perfect investment. While planning is a great asset, sometimes buyers have missed out on deals by waiting too long.

“I believe that there are many buyers who have been ready for a while with their credit and down payment money, waiting for the most opportune time to buy. They watch and wait and pounce as soon as the right property comes available,” Lopez said. “The shortage of property has caused multiple offers to be much more common with many first-time buyers having to try for several homes before they get one.”

Kathy Murray has found that many first-time buyers have saved up for a considerable down payment — a must now that zero-down financing is more rare than a black rhino. Murray says she sees many first-time buyers with at least 20 percent down, but hasn’t closed on a first-time deal yet for 2014.

With new mortgage qualifications and increasing rates, it’s likely we’ll see fewer first-time buyers for the remainder of 2014. What do you think?

5915 Anita Front

Stonewall Terrace is a fantastic neighborhood. The homes are adorable, there are restaurants and shops everywhere, there are tons of pedestrians and cyclists, nearby mass transit, and there’s easy access to North Central Expressway. But what really makes Stonewall Terrace a fantastic family neighborhood is its namesake elementary campus, Stonewall Jackson Elementary.

5915 Anita LivingThis neighborhood has pulled the school up by its bootstraps thanks to a super supportive early childhood PTA that has kept the trains running on time. That’s one of the reasons that this neighborhood, which is near the exceptionally popular M Streets, has skyrocketed as of late. But if you think you can’t find a deal in Stonewall Terrace, think again.

5915 Anita Dining

This adorable cottage at 5915 Anita St. is listed by Dallas City Center Realtor Patricia McCrite for $379,500. With almost 2,000 square feet, you’d be surprised at the size of this home from the curb. It is so adorable, isn’t it? But it’s truly spacious and still private feeling, thanks to the updates this home has received.

5915 Anita Kitchen

With beautiful built-ins and a lovely formal living and dining area, you could hold intimate get-togethers in this home. The kitchen is a bit modest, but there’s still room for a breakfast nook, so it’s not too terribly small. If you’re ambitious, you could expand the kitchen into the formal dining room and open the entire area up.

5915 Anita Master Bed 5915 Anita Master Bath

There’s a den, and the master suite features a living area, too. With three bedrooms and two baths, there’s plenty of room for a family. And with the hardwood floors, tons of great built-ins, this home will have room to grow.

5915 Anita Den

The backyard features a huge deck and separate fenced-in area, perfect for a family with a couple of pooches. What do you think of this home?

5915 Anita Deck 5915 Anita  Backyard

Gawker Hip AmericaGawker asks, “What is your city’s Williamsburg? What’s its hippest—or formerly hippest—or sometimes just youngest—neighborhood, the one with the art galleries and the boutiques and the lines for brunch? (And what, for that matter, is its Bushwick, or “Next Williamsburg”?) If you don’t know off the top of your head, don’t worry. We do, thanks to the collective knowledge of Gawker readers.”

Williamsburg is a cool Brooklyn neighborhood connected to the lower East Side of Manhattan by the Williamsburg Bridge that has moved from tenements to townhomes. The ‘hood has seen tremendous growth in the last ten years, far surpassing the image bestowed upon it from a book most of us read as children,  A Tree Grows in Brooklyn, about a young girl growing up in the tenements of Williamsburg. Recall the movie Serpico, starring Al Pacino? This, too, happened in Williamsburg. The area then became a hip mixture of Hispanics, gays, bikers, hippies and pot dealers — poor arty kids — until the last few years when the rich arty kids moved in.

But hey, urban gentrification happens.

So using their mapping etc. prowess, the Gawker folks asked and mapped out the next Williamsburgs in other U.S. cities. Oak Cliff is the current Williamsburg, Deep Ellum the Bushwick i.e. “poor arty kids” hood.

Oak Cliff 4 Deep Ellum 1
Deep Ellum 3 West Dallas 1
East Dallas 3
Bishop Arts 1
Denton 1
Expo Park

Oak Cliff, East Dallas, Bishop Arts, Denton and Expo Park, yes. Glad to see West Dallas in there, too! Great lines for brunch, great restaurants. But where is the Dallas Design District? I think it’s our Bushwick. It has a gritty past — I recall real estate developer Jim Lake showing me the bullets he found in the walls of buildings he bought and cleaned up.

Lake is a developer who first began investing in DD props in the 1990’s – his father helped pioneer Design District development, and Allan Knight was his first tenant. He found the bullets when he bought a dilapidated building off Irving Boulevard that had once housed young Korean girls in prostitution servitude AND their luggage.

In 2006 he told me the area was changing before our eyes. And guess what, it has. Jim Lake Companies helped rezone the district back in 2005 to allow residential use, and shortly after built Trinity Loft, which was up and almost fully leased by 2007. You can see the case study on the Lofts here:

Even the New York Times has taken notice of The Design District — see anything about Deep Ellum? 

Five years ago, you’d have been hard-pressed to find a cocktail-craving 30-something headed to a haute bar in Dallas’s design district, a once-industrial enclave centrally situated close to the Main Street district, near downtown. But now the design district is attracting new retailers, deep-pocketed developers and plenty of shoppers, thanks to a slew of buzz-worthy restaurants, chic stores and daring art galleries opening alongside brand-new apartments and lofts.

Agree or disagree?

 

 

 

Drew Philp Detroit by Garrett McLean

Author Drew Philp in his Poletown home he purchased for $500

Photo: BuzzFeed/Garrett Maclean

Candy and I have been discussing this very interesting long-form story from BuzzFeed about a man who bought a home in Detroit’s Poletown neighborhood for $500 when he was 23 years old. Since then, protesters, investors, and CEOs have bought up property throughout Detroit’s devastated neighborhoods, demolishing buildings and shrinking the city’s footprint.

Drew Philp‘s story is a gripping one if you are interested in reclaiming urban neighborhoods, overcoming a history of civic corruption, and reinvesting in cities wrought by economic peril. I know several people in the southern reaches of North Oak Cliff who have purchased homes knowing that it could be years before their neighborhood transitions into a marketable one and a profitable investment. Did that deter them? Heck no.

Still, Philp’s perspective on broadening gentrification is an interesting one. His account, which takes us through the first couple of years of living in a once-abandoned home that was so full of trash it took him a month to clear the first floor, to now. Here’s a telling excerpt:

Dan Gilbert, the owner of Quicken Loans, has moved more than 7,600 employees downtown. He also just sent a notice to one of my ex-girlfriends, explaining he has purchased the apartment building she’s lived in for the last 16 years and his future plans don’t include her. The city is talking of disinvesting in entire neighborhoods such as mine — literally letting the neighborhood go to seed and removing city services, shrinking the city in what some have termed as “white-sizing”; upstarts backed with foundation money are talking about transforming an entire neighborhood into an 2,475-acre urban farm. The state just approved a $350 million subsidized giveaway for a hockey stadium with a suburban fan base that’s going to tear down another portion of the city and push more people out. Of course, the divide between the gentrifying Detroit downtown and the bankrupt Detroit that is the rest of the city mirrors what is happening in a lot of this country.

These changes are making me feel a bit threatened and defensive. Instead of a lone weird white kid buying a house in Detroit, now I’m part of a movement. I shop at the Whole Foods, knowing every step into that store is a step away from a brand-new city that could be. And if someone tries to break into my house again I will not hesitate to defend myself and someday my family. Some days I feel caught in a tide I cannot row against, but these are the realities. Maybe I’m feeling a bit like the good people of Detroit must have felt to be counted amongst the citizens of “Murder City.”

But there’s another Detroit, too, of which I am but a small part. It’s been happening quietly and for some time, between transplants and natives, black and white and Latino, city and country — tiny acts of kindness repeated thousands of times over, little gardens and lots of space, long meetings and mowing grass that isn’t yours. It’s baling hay.

It’s the Detroit that’s saving itself. The Detroit that’s building something brand-new out of the cinders of consumerism and racism and escape.

Read the whole thing and then tell us: Does the modern Detroit really reflect how our nation is changing? And how do we turn the tide, as Philp suggests we do?

 

Drew Philp Detroit by Garrett McLean

Author Drew Philp in his Poletown home he purchased for $500

Photo: BuzzFeed/Garrett Maclean

Candy and I have been discussing this very interesting long-form story from BuzzFeed about a man who bought a home in Detroit’s Poletown neighborhood for $500 when he was 23 years old. Since then, protesters, investors, and CEOs have bought up property throughout Detroit’s devastated neighborhoods, demolishing buildings and shrinking the city’s footprint.

Drew Philp‘s story is a gripping one if you are interested in reclaiming urban neighborhoods, overcoming a history of civic corruption, and reinvesting in cities wrought by economic peril. I know several people in the southern reaches of North Oak Cliff who have purchased homes knowing that it could be years before their neighborhood transitions into a marketable one and a profitable investment. Did that deter them? Heck no.

Still, Philp’s perspective on broadening gentrification is an interesting one. His account, which takes us through the first couple of years of living in a once-abandoned home that was so full of trash it took him a month to clear the first floor, to now. Here’s a telling excerpt:

Dan Gilbert, the owner of Quicken Loans, has moved more than 7,600 employees downtown. He also just sent a notice to one of my ex-girlfriends, explaining he has purchased the apartment building she’s lived in for the last 16 years and his future plans don’t include her. The city is talking of disinvesting in entire neighborhoods such as mine — literally letting the neighborhood go to seed and removing city services, shrinking the city in what some have termed as “white-sizing”; upstarts backed with foundation money are talking about transforming an entire neighborhood into an 2,475-acre urban farm. The state just approved a $350 million subsidized giveaway for a hockey stadium with a suburban fan base that’s going to tear down another portion of the city and push more people out. Of course, the divide between the gentrifying Detroit downtown and the bankrupt Detroit that is the rest of the city mirrors what is happening in a lot of this country.

These changes are making me feel a bit threatened and defensive. Instead of a lone weird white kid buying a house in Detroit, now I’m part of a movement. I shop at the Whole Foods, knowing every step into that store is a step away from a brand-new city that could be. And if someone tries to break into my house again I will not hesitate to defend myself and someday my family. Some days I feel caught in a tide I cannot row against, but these are the realities. Maybe I’m feeling a bit like the good people of Detroit must have felt to be counted amongst the citizens of “Murder City.”

But there’s another Detroit, too, of which I am but a small part. It’s been happening quietly and for some time, between transplants and natives, black and white and Latino, city and country — tiny acts of kindness repeated thousands of times over, little gardens and lots of space, long meetings and mowing grass that isn’t yours. It’s baling hay.

It’s the Detroit that’s saving itself. The Detroit that’s building something brand-new out of the cinders of consumerism and racism and escape.

Read the whole thing and then tell us: Does the modern Detroit really reflect how our nation is changing? And how do we turn the tide, as Philp suggests we do?

 

2213 Stanley Ave Front

Let’s talk Tarrant County, folks, specifically Cowtown. Fort Worth, which is rated as a growth market and prime for investment by Trulia and Local Market Monitor, has some outstanding deals that are sure to make any homeowner happy.

Take this Tudor, for instance. It’s in the sought-after Berkeley Place neighborhood just east of Forest Park and South University Drive. Close to the Fort Worth Zoo and with great access to downtown Fort Worth, this neighborhood has a treasure trove of fabulous architecture at some outstanding prices.

2213 Stanley Ave Living Dining

At 2213 Stanley Avenue you’ll find a beautiful 1926 Tudor with three bedrooms, two baths, and a garage apartment for listed by Brants Realtors for $349,500. The garage apartment, which is a one-bedroom, one-bath unit with an open floorplan, could be a source of income should the neighborhood zoning allow it. You could definitely fit a Texas Christian University student in there comfortably.

2213 Stanley Ave Breakfast

In fact, this is one of those outstanding homes that you could buy as an investment while your child attends college nearby. Once they’ve graduated, spiff the place up to perfection (that means updating the kitchen countertops, the hall bath, and the powder room) and sell it for some real dough. Your child could live there rent-free, and you could lease it to two or three of her Greek sisters or brothers, or band members, or whatever — you get the drift. With that income, you could make a profit or perhaps break even in the meantime!

2213 Stanley Ave Music room 2213 Stanley Ave Master 2213 Stanley Ave Hall bath

With 1,880 square feet of living space, you won’t be hurting for room, either. The master bedroom, has a separate entrance, which is a plus, privacy-wise. There’s also a dual carport, which definitely helps with off-street parking, and there’s a laundry and storage area below the garage apartment.

2213 Stanley Ave Backyard 2213 Stanley Ave Garage Apt

The backyard features a lovely elevated deck, too, as well as a spacious lawn and privacy fence. The apartment’s square footage isn’t included in the total, and wasn’t available in the listing. The unit, pictured above, seems big enough for a student, for sure. And there is enough charm and care to make this a comfortable spot for anyone who purchases this place, including tons of new windows and beautiful original hardwood floors.

What do you think?