Wednesday, January 25, 2006

Florida, Colorado, Utah Foreclosures Up

National Real Estate Foreclosures Up in 2005
Florida, Colorado, Utah post highest foreclosure rates

Reprinted from Inman News
Monday, January 23, 2006


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National real estate foreclosures increased in every quarter of 2005, according to an industry report released today.


RealtyTrac, which provides an online marketplace for foreclosure properties, today released year-end data showing that 846,982 properties nationwide entered some stage of foreclosure in 2005, and there was a 25 percent increase in the number of new foreclosures from the first quarter to the fourth quarter.

"Overall, U.S. foreclosure numbers climbed steadily over the course of the year, with more new foreclosures reported in every quarter," said James J. Saccacio, CEO of RealtyTrac. "This trend appears to be moving the real estate foreclosure market back to its historic levels."

Saccacio noted that the number of 2005 foreclosures needed to be kept in context. "Even with almost 850,000 properties entering some stage of foreclosure across the country over the course of the year, this represents less than 1 percent of all U.S. households. And the increase in U.S. foreclosures from Q3 to Q4 was just below 5 percent."


Report highlights included:

Despite a 29 percent decrease in new foreclosures from the first quarter to the fourth quarter, Florida documented the nation's highest foreclosure rate and accounted for more than 14 percent of the nation's new foreclosures in 2005. The state reported 121,843 properties entering some stage of foreclosure -- 1.67 percent of the state's households.

New foreclosures in Colorado decreased 4 percent from the first quarter to the fourth quarter, but the state's annual foreclosure rate ranked second highest nationwide thanks to consistently high foreclosure numbers throughout the year. A total of 29,630 Colorado properties entered some stage of foreclosure in 2005 -- 1.62 percent of the state's households.

1.5 percent of Utah households entered some stage of foreclosure in 2005, the nation's third-highest annual foreclosure rate. The state reported 11,536 properties entering some stage of foreclosure during the year, but new foreclosures dropped 27 percent from the first quarter to the fourth quarter.

New foreclosures in Texas increased 54 percent from the first quarter to the fourth quarter, and the state documented the nation's fourth highest annual foreclosure rate. A total of 115,643 Texas properties entered some stage of foreclosure in 2005 -- 1.44 percent of the state's households and more than 13 percent of the nation's new foreclosures in 2005.

Other states with foreclosure rates ranking among the 10 highest nationwide were Georgia, Arizona, Indiana, New Jersey, Ohio and Tennessee. All of these state documented annual foreclosure rates of at least 1 percent of total households and reported new foreclosures increasing from the first quarter to the fourth quarter

Although their foreclosure rates ranked below the nation's 10 highest, California, Illinois, New York and Michigan were among the 10 states reporting the most new foreclosures in 2005. California reported 61,563 properties entering some stage of foreclosure, and new foreclosures increased 16 percent from the first quarter to the fourth quarter. Illinois reported 46,723 properties entering some stage of foreclosure, and new foreclosures decreased 14 percent from the first quarter to the fourth quarter. New York reported 37,068 properties entering some stage of foreclosure, and the state reported more than twice as many new foreclosures in the fourth quarter as in the first quarter.


"Over the past few years, we've seen historically low mortgage rates, consistently escalating home prices and steady, strong employment," Saccacio said. "This has translated into relatively low levels of foreclosure properties -- particularly bank-owned properties. With interest rates rising and an apparent slowing of property valuations in most markets, we'll be watching closely to see if there's a material effect on the number of foreclosures in 2006."

The RealtyTrac 2005 U.S. Foreclosure Market Report provides the total number of homes entering some stage of foreclosure nationwide and by state for each quarter of 2005. The report includes properties in all three phases of foreclosure: pre-foreclosures – notice of default (NOD) and lis pendens (LIS); foreclosures – notice of trustee sale and notice of foreclosure sale (NTS and NFS); and real estate owned, or REO properties (that have been re-purchased by a bank).

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For more information on foreclosure investment opportunities visit:
http://bobdiamond.com

Tuesday, January 17, 2006

Foreclosure Market Update

South Drives Foreclosure Spike
24,124 foreclosures started in December
January 13, 2006 release by Foreclosure.com

As new foreclosures rose during December, the inventory jumped by the highest amount since March 2005. Foreclosure.com announced Wednesday that 24,124 U.S. residential properties joined the foreclosure list last month, 8 percent more than in November.

The total number of foreclosed homes available for sale shot up 13% from the prior month to 91,905 in December, the Boca Raton, Fla.-based company reported.

Both the inventory and the newly-listed increases were the highest month-to-month boost since last March, according to the announcement. "The relative stability of U.S. foreclosure inventory ended in December," said company President and CEO Brad Geisen in the statement. "With lending institutions closing their books at the end of the year, it is somewhat common for the foreclosure inventory to rise."

And while it is "premature to predict that December's inventory indicates a foreclosure crisis," the rise, "which is higher than in recent years, should be closely monitored as 2006 begins," he added.

Inventory will very likely remain high in the early months, if waning investor confidence in the housing market, high interest rates and a weakening sellers market persist, Geisen said.

The South, which includes Florida, Georgia, North Carolina and Texas, led the country with a 9 percent increase in inventory and a 17.4 upturn in new foreclosures, Foreclosure.com spokeswoman Tristam Wallace said in an e-mailed statement. The Midwest showed the second highest percentage increases, followed by the Northeast and the West, according to the announcement.

Texas had the highest foreclosure inventory -- 11,458 -- followed by Ohio's 8419 and Michigan's 7,955 properties. They also had the largest amount of new foreclosures in the month, 2,997, 2380 and 2064, respectively, the announcement said.

"Regardless of what happens in the first quarter, the current foreclosure inventory represents a very strong buyers market for investors and individuals," Geisen concluded.

For Free Information on buying and selling properties in Foreclosure visit: http://bobdiamond.com

Tuesday, January 10, 2006

Anatomy of a Deal ~ How to Analyze a Deal in Thirty Seconds

Anatomy of a Deal
From the Down and Dirty to the Nitty-Gritty and
How to Analyze a Deal in Thirty Seconds


Many students get “stuck” somehow when they leave a seminar or finish a home study course. They are unable to go out and make their first deal. I think it is mostly fear – fear that they do not know enough, fear of losing money, and fear of change – even if that change is success. Stories of how others overcome their fear and how deals are actually done can help you work through some of those fears.

How would you like to sit in the co-pilot seat as my partner and I make our way through our newest deal – acquisition, purchase, and rehab of a twelve-unit apartment building? One where we can make hundreds of thousands of dollars in one year?

In this series I am going to take you with me – step by step, as I analyze the deal, locate financing, insurance, work out issues with my partner, and close on the deal. We’ll then go on through emptying out the apartments, renovating them and refilling them with new tenants at a higher rental rate.

In today’s blog I am going to tell you how I got started and how I generated the lead. In subsequent newsletters I will take you through all the details – A to Z as I work my way through the deal.

So sit back, get a cup of coffee, and enjoy the ride.

Time to Get Started finding the deal

I am just wrapping up my renovation on my new primary residence. I like to do no more than one or two deals at a time so I have time to spend with my family, law practice, and students. After all, why be an entrepreneur if I cannot make time for the people in my life and the things I want to do other than work? I make margins of $60,000 - $90,000 in each flip, so it does not take many deals to keep me happy each year.

I do not do large mailing campaigns, telemarketing, billboards or radio advertising. Those things are expensive and time consuming. I find my deals by networking through the people I know and meet. Networking is effective and inexpensive marketing.

I started my networking about a month before my current project will be finished. I have been telling everyone I know that I am looking for a new property to renovate. I have told my neighbors, all the workers at my site, my general contractor, and fellow investors.

I received a call from Neal my general contractor today. He heard about a twelve-unit apartment building down the street from my house. It is being offered at $750,000 and just came on the market. He wanted to know if I wanted to look at it with him as something to do together.

First I have to decide whether to leave the office to look at this deal. My time is valuable and I try not to waste it. So how do I do an initial screening in less than 30 seconds? The answer is my 1% rule©.

I know rents in the neighborhood are $1,100 or so for a two-bedroom apartment in this area. The units rent easily and it is easy to find responsible tenants. I know those facts because I already have rental properties in this neighborhood. The potential rents for all twelve units in the building are approximately $13,100 per month (exact figure will depend on the breakdown of units by number of bedrooms).

Using my 1% rule©, I figure if my monthly rents are 1% of my purchase price I will break even on the building. The resulting figure is also a good approximation of the “retail” price of the property. In this instance the retail price of the building with good tenants at full market rent will be approximately $1,310,000.

I do not pay retail for properties. You shouldn’t either. For a rental property you want at least 20% off retail so you have an equity cushion and good positive cash flow.
Using my 1% rule© the “retail” price for the building of $1,310,000 and a “Bob Diamond” price of $1,048,000 (the 1% rule less 20%).

Since the asking price for this building is $750,000, and the potential retail value is $1,310,000 there is potentially $560,000 in equity in the building. I am definitely interested in the building! Time to go out and see the building!

In my next installment I’ll tell you about the inspection of the building and how we calculated our offer.

Until then…
Awesome Investing!
Bob Diamond
http://bobdiamond.com

Want to know more?

Do you want to make hundreds of thousands of dollars in cash and equity in properties? Do you want to learn from an attorney and ACTIVE investor who will give you all the details and “real” information you need to succeed?
If so, I really am your guy.
Find out more at:
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About Me

Philadelphia, PA, United States
Bob Diamond is a practicing real estate attorney, real estate developer, and published author of three books on foreclosure investing. You may be familiar with Bob from his appearances on FOX, NBC, or CNBC or on his real estate radio show. Inside the investor world, Bob is known as the ‘guru’s guru’ and teaches advanced real estate investing techniques including buying discounted liens, notes and judgments, buying out of bankruptcy, short sales, taking under and subject to, straight equity purchases, multi-units and even condo conversions.