Investors getting rich again off the little people... Again!
Back in 2006 I had a client who needed to buy a home. He was a new father to be, and he and his wife lived in an old apartment downtown where the air conditioning didn't work, and it just wasn't meant to raise a family. He made a decent income ( an arquitect ) and his wife who worked was still looking for a better job. We looked for a few weeks and found a few options. Back then, you still had to be quick while thinking of an offer because by the time that they made up their mind, and I put it in writing the home would be under contract. Finally, we found a home with most of what they needed. It only had one bathroom...
The people selling the home had bought it circa 2000 and were walking away with over $50,000. My buyer, I will call him Ed, was so bitter about having to pay so much for a home where the sellers were making so much of what he considered his pocket. It was just not fair that life would be so unfair to him. Ed was in his 30's and had had that good job for years. I asked him why he hadn't bought a home earlier in life, as he would have been able to afford it. He said, he was waiting for the right time. He needed a home now because at this point he thought prices would continue to go even higher. I remember at the closing table Ed was so angry and bitter that some one else was making so much money of off him. Well, he had missed the boat, and if he had bought earlier before 2004-2003 he would be selling with a profit and moving on to a better home than what he could afford at that time. He thougth Investors were getting rich off the little people .... Again!.
He is a perfect example of today's would be buyers who are still waiting for prices to come even lower. Even if they drop a little more and they stay stagnant for a few years, interest rates won't be coming down any lower, as the banks are borrowing money pretty much for free from the government to lend it to the consumer. Lower rates mean that the government will be paying the banks, so that they can lend money to the public. I am no economist, but I don't see that happening. I dread to think what that would be like.
What I see now are the few and brave selling or holding on to their first home to move up closer in to their dream homes. Wise Investors getting rich off the little people are buying rentals left and right with the plan of holding for the long term for the right time to sell. They did not buy when the wanna be investors, and wanna get rich quick schemes were hot. They are buying now, when the regular people and the rest of the population are afraid to make a move. Who do I see building like crazy? Apartment buildings communities. Renters, now will fill the pockets of the already rich (investors) who know that the populate can't buy any longer or are afraid to buy.
If you are a first time home buyer and can afford to buy, are ready to move up or you always wanted to become a landlord this is the time to take that risk. Millionaires didn't get rich by doing what every body else is doing. They see an opportunity and jump in before some body else takes it. There are many ways to invest in real estate. If you want to find out, what options are out there CONTACT ME. Don't be like Ed and miss the boat again.
And what is Ed doing these days? He has a few kids and is still waiting for that great opportunity. (still only one bathroom)
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Investors are getting rich off the little people.... Again was first published on Hampton Roads Real Estate Voice Copyright © 2010 By Tere Rottink, All Rights Reserved.