Category Archives: Armonk

Zillow kickback problem | Armonk Real Estate

Earlier this month, Zillow Group Z, +0.39%  , the popular online real estate data provider, reported blowout earnings. Revenue rose 32% compared to a year ago, and online visits were up 18%.

But there was a note of caution in its earnings release. In April, the company said, it had received a notice from the Consumer Financial Protection Bureau that questioned whether some of Zillow’s advertising revenues violated regulations against kickbacks.

At issue is the question of how a real estate service provider, like a real-estate agent or lender, gets business from a home buyer. Congress passed the Real Estate Settlement Procedures Act, also known as RESPA, in 1974 to make sure those providers weren’t funneling customers to each other in exchange for kickbacks or other inappropriate rewards.

Real estate market observers say that while Zillow’s broad footprint and accessible data have been a boon for customers, deciding whom to hire for the transaction is often a fraught process that could benefit from more transparency and less of the old handshake-deal approach that has often characterized real estate.

In Zillow’s case, what’s called “co-marketing” works by allowing a real estate agent to share the cost of an ad on the web site with a preferred lender.

Zillow

This practice makes it seem as though those lenders or agents are receiving a seal of approval from each other or from Zillow itself. Many industry participants see the co-marketing process as little more than advertising that may appear like due diligence to a captive and uninformed customer.

There’s broad recognition among consumer advocates – and the CFPB itself – that would-be home buyers don’t shop for mortgages. It’s hard to spend the time required with more than one lender, and there are concerns about checking credit scores too frequently. And many lenders use confusing jargon that makes it hard for consumers to compare one offer to another.

“People do real estate transactions rarely, a couple times in their lifetime, so it’s not like people can gain experience, and it’s hard to shop around because you don’t know what you’re asking for,” said Andrew Pizor, a staff attorney at the National Consumer Law Center.

“It’s opaque and there’s very little competition,” Pizor continued. “It’s a horrible market. As a consumer advocate I have my doubts about the free market, but this is not a free market in terms of supply and demand and transparency. It just puts consumers even more at risk.”

As Pizor puts it, “you only want people to be making a referral for reasons based on the merits of the product or the service: they’re good and you trust them or they have a product you can’t get elsewhere, not because you’re getting referrals.”

The CFPB’s interest dates back to 2015. The agency has requested information several times since then, with the most recent request, a civil investigative demand, coming in April. “We are continuing to cooperate with the CFPB in connection with their most recent request for information,” Zillow’s earnings report noted. “We continue to believe that our acts and practices are lawful and that our co-marketing program allows lenders and agents to comply with RESPA.”

The next step, Zillow added, could be what’s known as an “enforcement action,” which could include “restitution, civil monetary penalties, injunctive relief or other corrective action. We cannot provide assurance that the CFPB will not ultimately commence a legal action against us in this matter, nor are we able to predict the likely outcome of the investigation into this matter.”

A Zillow spokeswoman declined to answer MarketWatch questions on the scale of the co-marketing program. Company management fielded four analyst questions on the CFPB review on its quarterly earnings call and said little except that “it’s a small portion of overall revenue.”

But the prepared remarks for the earnings release noted that customer leads rose 30% compared to a year ago in the first quarter, and “we continue to expect that growth in contacts sent to Premier Agent advertisers will outpace unique user growth.”

In an emailed statement, the spokeswoman wrote, “Zillow offers myriad ways for consumers to comparison shop for lenders and agents. Rather than offer a few service providers, consumers can browse more than a million reviews for agents and lenders, including published, up-to-the-minute mortgage rates being offered and skill sets of particular agents. Zillow Group’s mission is to give consumers lots of information so they can make good choices when choosing agents and lenders for one of the most important transactions of their lives.”

The CFPB also declined to discuss the matter with MarketWatch.

The agency usually only takes actions like the ones against Zillow when it believes its case is “pretty clear-cut,” Pizor told MarketWatch. “I think the CFPB is being generous. I think the law is pretty clear.”

Still, Pizor said, a ruling from the CFPB would help bring clarity to the market – a step many real estate professionals would welcome. The National Association of Realtors has released best practices materials recommendations and industry lawyers are watching carefully.

The CFPB earlier this year fined Prospect Mortgage, a lender, with failing to comply with RESPA. It also fined two real estate brokers and a mortgage servicer, all of whom it said took kickbacks from Prospect.

To many industry participants, it seems clear that the co-marketing arrangement must be very profitable for Zillow. Why else would a new-media company founded to, as it says in its mission statement, “empower” customers with new ways of shopping for and maintaining a home cling to an outdated way of doing business, rather than trying to disrupt it with a newer, better model?

“Nobody is doing referral fees any more. They were done away with. Marketing service agreements are the next wave of that,” said Brian Faux, CEO of Morty, an online mortgage brokerage.

Faux describes Zillow as a “great web site with a lot of data that’s good for consumers,” including data that helps them understand the cost of owning a home.

 

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http://www.marketwatch.com/story/zillow-advertising-under-cfpb-fire-sets-real-estate-industry-on-edge-2017-05-18

U.S. Housing: Going From Good To Great | Armonk Real Estate

Activity levels and selling prices for the domestic real estate market last peaked in 2005, two years after the prior peak of the economic cycle (i.e., GDP) in 2003 (at 4.4%). Thus, by preceding the 2008-09 recession, this most recent national housing bust set a precedent as the first in recorded history in which housing helped lead the economy down.

And when economic activity bottomed in early-’09 (March GDP fell 4.9%), domestic housing remained at stubbornly low levels for a few more years.

Sources: US Dept. of Labor (BLS), National Association of Realtors (NAR), US Bureau of Census.

Note: sales of existing homes account for >90% of all homes sold in the US, up from ~85% pre-crisis.

Even today, more than a decade after the start of housing’s precipitous decline, total US sales volumes (including new homes) remain nearly 30% below peak levels, and over 15% below the 2000-’05 average.

It is a different world post-crisis / housing bust, and residential real estate’s demographic hurdles remain high. For example, baby boomers, many of whom live on fixed income payments, are only beginning to downsize or move into managed care facilities.

The more pervasive demographic challenge to home-ownership rates – now below 64%, vs. more than 69% in 2004 – is posed by ‘echo boomers’, in their 20’s and 30’s. Born in the 80’s and 90’s these younger demo’s that nevertheless still account for the bulk of entry-level home purchases, more often favor renting over buying, a contrast to their parents and grandparents.

Thus, Entry-level home-buying now represents only about one-third of housing activity, down solidly from pre-crisis historical levels averaging 40%. First-time buying has, however, slowly improved from cycle lows in the high 20%’s, and in my opinion has plenty of runway ahead.

Sources: US Dept. of Labor (BLS),

A couple quick observations. The tight relationship between labor force participation and home-ownership, both of which appear to be bottoming or at least steadying. And, more importantly, the nearly six percentage point drop in home-ownership since 2004, and the comparable decline in entry level home purchases from most past averages.

This paucity of first-time purchases, of relatively inexpensive homes, in fact overstates housing’s recent strength and helps underscore the housing industry’s lack of breadth. Case-Shiller, a commonly used barometer of domestic house prices (only), echoes later price charts, and indicates average selling prices (ASP’s) are still below levels more than 10 years ago.

Source: S&P Corelogic Case-Shiller.

It’s About Jobs (Mainly)

The most important driver for housing demand is job growth. Moreover, it’s the absolute number of jobs created, rather than the unemployment rate, that housing most depends.

The 2017 YTD figure is annualized, and based on latest figures: April’s jobs and March’s home sales.

Sources: US Dept. of Labor (BLS), NAR.

Indeed, existing home sales have tracked changes in jobs, but in direction – rather than in magnitude. Since housing peaked in late-2005, the US economy has added roughly 11 million new jobs, yet housing activity remains solidly below past levels, as we’ll talk more about. At some point new jobs will more accurately translate into similar increases in home sales.

Confidence Is Key

Consumer confidence is the next most important driver of home sales, after employment. Multiple cycles of empirical data bear this out.

Consumer sentiment based on annual averages of month-end figures

Sources: University of Michigan, US Dept. of Labor (BLS), NAR

Despite steady improvements in consumer confidence since its 2008 trough, the figure, though still steadily upward trending, remains below it base level (100) just as home sales volumes track below their ‘normalized’ levels.

To paraphrase Jamie Dimon, CEO of JP Morgan Chase, the country’s #2 mortgage originator (after Wells Fargo), consumer confidence is the ‘secret sauce’, to housing.

Interest Rates Matter, Though Less Than Is Assumed

Of course rates matter for housing: a single percentage point decline in mortgage rates buys a 15% more house (over 30 years, ceteris paribus). But, contrary to conventional beliefs, empirical evidence suggests interest rates rank behind consumer confidence in terms of importance for the industry.

Although it’s the third leg of the proverbial stool supporting home sales, (mortgage) rates are the factor that most directly benefit from a Federal Reserve Board that has been decidedly ‘dovish’, pursuing relatively easy monetary policy these past 35 years or so.

Source: NAR

Yet as investors (and borrowers) handicap a potential increase in short-term rates by the central bank in its next (NYSEARCA:JUNE) meeting, we tend to overstate the impact of mortgage rates on housing.

Favorable borrowing rates had a mitigating effect on the housing ‘bust’. The Fed’s move to zero short-term rates, which lasted a full seven-years (Dec. ’08 – Dec. ’15) has thus far had a similarly benign impact on the subsequent recovery.

Their impact (low rates) has been partly muted by a number of factors, mainly mortgage originators’ basic business decisions (i.e., risk / reward), stricter home-lending regulations, the disappearance of independent mortgage brokers (e.g., Washington Mutual, Countrywide, etc.) and the reduced activity among government sponsored mortgage securitizers (e.g, Fannie Mae).

Yet were it not for mortgage rates following 10-year Treasurys to just over 2% with the launch of quantitative easing (late-2008), financial history might have been much different: One can only speculate on the further damage to home prices, mortgages (especially adjustable), securitizations, etc. that would have occurred had the Federal Reserve not stepped in with zero rates and levered its balance sheet by $4 trillion.

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https://seekingalpha.com/article/4070667-u-s-housing-going-good-great

New Home Sales Post Slight Increase | Armonk Real Estate

New home sales contracts expanded by 3.7% in January over a soft December reading, according to estimates from the joint data release of HUD and the Census Bureau. Despite the gain, which places the January pace of sales 5.5% higher than a year ago, the current seasonally adjusted annual rate of 555,000 is slightly below the positive growth trend that has been in place over the last few years.

Inventory growth continued in January. After hovering near 240,000 for most of 2016, inventory increased to 247,000 in October, 256,000 in December and 265,000 in January. The current months’ supply number stands at 5.7, higher than the existing market (3.6) estimate.

Solid builder confidence and ongoing tight inventory conditions suggest continued growth for single-family construction in the months ahead. An open question is pricing, given rising construction prices and increasing interest rates. New homes will need to be competitively priced, even as prices for existing homes continue to grow. For this reason, we continue to expect a broadening of the new home inventory base and slight declines in median new home size.

 

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http://eyeonhousing.org/2017/02/new-home-sales-post-slight-increase/

The Aging Housing Stock | Armonk Real Estate

The American housing stock continues to age, especially since residential construction grew at a modest pace after the Great Recession. The median age of owner-occupied housing increased to 37 years in 2015 from 31 years a decade ago. This housing stock aging trend signals a growing market for remodelers, as older structures normally require additional remodeling and renovations. It also implies a rising demand for new construction over the long run.

As of 2015, more than half of the US owner-occupied housing stock was built before 1980, with around 38% built before 1970. Owner-occupied homes constructed after 2000 make up 19% of the owner-occupied housing stock, and homes built after 2010 account for only 3% of the owner-occupied housing stock.

The share of housing stock built 45 year ago or earlier increased significantly from 32% in 2005 to 38% in 2015. However, the share of new construction built within past 5 years declined to 3% in 2015, compared to 9% in 2005.

According to the 2015 ACS, homeowners with higher family incomes tend to live in the newer residential units. In 2015, the average household income for owner-occupied homes built after 2010 was $ 121,577, which was higher than $86,328 average family income for those living in homes built before 1969. Moreover, younger homeowners are more likely to live in newer homes. Homes built after 2010 are headed by homeowners with a median age of 44 years, compared to homes built prior to 1969 and owned by householders with a median age of 58. It implies a growing market for renovations allowing older homeowners to age in place.

 

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http://eyeonhousing.org/2017/01/the-aging-housing-stock-3/

 

Fight Brewing Over the Mortgage-Interest Tax Deduction | Armonk Real Estate

A tax-reform proposal by House Republicans that would make the mortgage-interest deduction moot for most Americans is starting to set off alarm bells across the housing, lending and real estate industries.

The right to take a deduction for interest paid on your mortgage has always been a political third rail, and the reforms introduced last June would not directly eliminate the write-off.

Instead, the Better Way tax-reform “Blueprint” of Speaker Paul Ryan and his cohorts would make the deduction irrelevant for about 95 percent of homeowners. By “doubling the standard deduction that taxpayers receive…most people would have no need to take the mortgage interest deduction,” according to National Mortgage News.

The specific language in the Better Way says: “This Blueprint will preserve a mortgage interest deduction for homeowners. …For those taxpayers who continue to itemize deductions, no existing mortgage will be affected by any changes in the tax code. Similarly, no changes will affect re-financings of existing mortgages. But just as importantly, because of the other provisions included in the new tax system, far fewer taxpayers will choose to itemize deductions, with the vast majority of taxpayers finding they are better off by taking advantage of the larger, simpler standard deduction instead.”

Before the election, when it did not look as though Republicans would control both houses of Congress and the White House, the future of the Blueprint seemed far from certain, and even given the GOP sweep in Washington, it is nowhere near a done deal.

But National Mortgage News says the National Association of Homebuilders, the Mortgage Bankers Association and the National Association of Realtors (NAR) have all woken up to what they see as an “indirect threat” to the mortgage-interest deduction.

National Mortgage News quoted Lawrence Yun, chief NAR economist, as a warning against any moves that might derail the housing recovery. “Even a discussion of mortgage interest deduction is counterproductive right now,” he said.

A spokesperson for the NAR said Yun was unavailable to expand on that view given that under the Blueprint, most homeowners would still get the same break on their taxes.

But homebuilders, lenders and realtors may have more to worry about than House Republican attempts to neuter the mortgage-interest deduction.

In a CNBC interview on Nov. 30, Steve Mnuchin, Trump’s nominee for Treasury Secretary said in the context of a discussion on tax reform: “…We’ll cap mortgage interest but allow some deductibility.”

CNBC real estate reporter Diana Olick explained later that “The mortgage interest deduction is already capped at loans up to $1 million if you’re married and filing jointly and at $500,000 if you file separately. That said, the median price of a home in the United States is just more than $200,000, so not a lot of people make it to that cap.”

But, she added, the mortgage-interest deduction is seen as a key selling point for the housing industry and therefore is “a hot potato that lawmakers really don’t want to touch.”

 

read more…

http://www.thefiscaltimes.com/2016/12/16/There-s-Big-Fight-Brewing-Over-Mortgage-Interest-Tax-Deduction

Construction Job Openings Continue to Rise | Armonk Real Estate

The count of unfilled jobs in the overall construction sector increased in September, as residential construction employment continued to grow.

According to the BLS Job Openings and Labor Turnover Survey (JOLTS) and NAHB analysis, the number of open construction sector jobs (on a seasonally adjusted basis) grew to 221,000 in September, after establishing a cycle high of 225,000 in July. The July estimate represents the highest monthly count of open, unfilled jobs since February 2007.

The open position rate (job openings as a percent of total employment) for September was 3.2%. On a smoothed twelve-month moving average basis, the open position rate for the construction sector increased to 2.6%, setting a cycle high and surpassing the top twelve-month moving average rate set prior to the recession.

The overall trend for open construction jobs has been increasing since the end of the Great Recession. This is consistent with survey data indicating that access to labor remains a top business challenge for builders.

jolts

The construction sector hiring rate, as measured on a twelve-month moving average basis, fell back to 4.6% in September.

Monthly employment data for October 2016 (the employment count data from the BLS establishment survey are published one month ahead of the JOLTS data) indicate that home builder and remodeler net hiring continued to grow, as sector employment increased by 4,500 after posting a 13,200 gain in September. These gains come after a recent period of hiring weakness, which has reduced the 6-month moving average of jobs gains for residential construction to just under 5,000.

Residential construction employment now stands at 2.618 million, broken down as 737,000 builders and 1.881 million residential specialty trade contractors.

res-construction

Over the last 12 months home builders and remodelers have added 140,000 jobs on a net basis. Since the low point of industry employment following the Great Recession, residential construction has gained 632,000 positions.

 

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http://eyeonhousing.org/2016/11/construction-job-openings-continue-to-rise/

Home price index reaches all-time high | Armonk Real Estate

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index for September blew past the peak set in July 2006, with the national index posting a 5.5% annual gain in September, up from 5.1% last month, S&P reported Tuesday morning. The 10-City Composite posted a 4.3% annual increase, up from 4.2% the previous month. The 20-City Composite reported a year- over-year gain of 5.1%, unchanged from August.

Before seasonal adjustment, the National Index posted a month-over-month gain of 0.4% in September. Both the 10-City Composite and the 20-City Composite posted a 0.1% increase in September. After seasonal adjustment, the National Index recorded a 0.8% month-over-month increase, the 10-City Composite posted a 0.2% month-over-month increase, and the 20-City Composite reported a 0.4% month-over-month increase. 15 of 20 cities reported increases in September before seasonal adjustment; after seasonal adjustment, all 20 cities saw prices rise.


Seattle, Portland, and Denver reported the highest year-over-year gains among the 20 cities over each of the last eight months. In September, Seattle led the way with an 11.0% year-over-year price increase, followed by Portland with 10.9%, and Denver with an 8.7% increase. 12 cities reported greater price increases in the year ending September 2016 versus the year ending August 2016.

“The new peak set by the S&P Case-Shiller CoreLogic National Index will be seen as marking a shift from the housing recovery to the hoped-for start of a new advance,” said David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices. “ While seven of the 20 cities previously reached new post-recession peaks, those that experienced the biggest booms — Miami, Tampa, Phoenix and Las Vegas — remain well below their all-time highs. Other housing indicators are also giving positive signals: sales of existing and new homes are rising and housing starts at an annual rate of 1.3 million units are at a post-recession peak.


Rents Cooled in the Third Quarter | Armonk Real Estate

Record levels of new multi-family construction are meeting demand in the nation’s hottest market, cutting in half the pace of rent increases nationwide and driving down median rents in more markets during the third quarter, according to rental analytics firm Axiometrics.

Nationally, rents rose only 3% for the third quarter of 2016, more than 2 percentage points below the robust 5.2% rent growth of one year ago. This marked the fourth straight quarter in which the annual rent growth rate decreased.  The average effective rent nationwide was $1,289 per unit per month, compared to $1,251 in the third quarter of 2015.

“While the national apartment market is still performing above the long-term average, the moderation from the unsustainable levels of 2014 and 2015 has come, as Axiometrics predicted,” said Jay Denton, Axiometrics Senior Vice President of Analytics. “In particular, rent growth has declined precipitously in markets with the highest rents in the country, such as New York and the San Francisco Bay Area.”

Rent levels declined year over year in the three major markets with the highest rents — San Francisco, New York and San Jose — and increased by less than 2% in the fourth highest rent-growth metro, Oakland. Although Houston isn’t a high-rent market, its -2.8% rent growth in the third quarter also helped weigh down the national rate.  Hartford, Birmingham and Oklahoma City also experienced negative annual rent growth.

Third-Quarter 2016 Rent, Rent Growth in Highest-Priced Markets

Market

Average Effective Rent

Annual Effective Rent Growth

San Francisco

$3,292

-0.5%

New York

$3,036

-0.2%

San Jose

$2,817

-0.8%

Oakland

$2,413

1.8%

 

“Urban cores in general are showing slowing performance,” Denton said. “The market is feeling the effects of the concentrated new supply in these submarkets. Nationwide, however, supply is just keeping up with the demand.”

The slower performance of high-priced markets is somewhat counteracted by robust fundamentals in secondary markets. For example, annual effective rent growth in Sacramento; Riverside, CA; Salt Lake City; Las Vegas; Fort Worth; Tampa-St. Petersburg; and Nashville are among the 10 highest in major markets.

Other Third-Quarter Highlights

•             Effective rents increased 1.2% in the third quarter over the second quarter. The rent-growth rates for the past four quarters have been lower than the previous corresponding quarters.

•             Occupancy was 95.1% in the third quarter, compared to 95.2% in the second quarter and 95.4% in the third quarter of 2015.

 

  • 95.4% in the third quarter of 2015.

Top 25 Markets for Rent Growth and Occupancy

The top 25 Metropolitan Statistical Areas or Metropolitan Divisions — among Axiometrics’ top 50 markets with the most apartments — in various third-quarter 2016 categories:

Top 25 Markets by Annual Effective Rent Growth for 3Q16

MSA/Metropolitan Division

Annual Effective Rent Growth

Sacramento-Roseville-Arden-Arcade, CA

11.9%

Riverside-San Bernardino-Ontario, CA

7.9%

Seattle-Bellevue-Everett, WA

6.7%

Salt Lake City, UT

6.7%

Phoenix-Mesa-Scottsdale, AZ

6.4%

Las Vegas-Henderson-Paradise, NV

5.7%

Fort Worth-Arlington, TX

5.6%

Tampa-St. Petersburg-Clearwater, FL

5.5%

Nashville-Davidson-Murfreesboro-Franklin, TN

5.4%

Atlanta-Sandy Springs-Roswell, GA

5.4%

San Diego-Carlsbad, CA

5.3%

Anaheim-Santa Ana-Irvine, CA

4.9%

Orlando-Kissimmee-Sanford, FL

4.9%

Dallas-Plano-Irving, TX

4.6%

Charleston-North Charleston, SC

4.4%

Memphis, TN-MS-AR

4.3%

Warren-Troy-Farmington Hills, MI

4.2%

Portland-Vancouver-Hillsboro, OR-WA

4.1%

Los Angeles-Long Beach-Glendale, CA

4.0%

Charlotte-Concord-Gastonia, NC-SC

4.0%

Raleigh, NC

3.7%

Minneapolis-St. Paul-Bloomington, MN-WI

3.7%

Indianapolis-Carmel-Anderson, IN

3.5%

Boston-Cambridge-Newton, MA-NH

3.5%

West Palm Beach-Boca Raton-Delray Beach, FL

3.3%

National

3.0%

Top 25 Markets by Quarterly Effective Rent Growth for 3Q16

MSA/Metropolitan Division

Quarterly Effective Rent Growth

Sacramento-Roseville-Arden-Arcade, CA

4.2%

Salt Lake City, UT

3.0%

San Francisco-Redwood City-South San Francisco, CA

2.6%

Boston-Cambridge-Newton, MA-NH

2.5%

Atlanta-Sandy Springs-Roswell, GA

2.4%

San Diego-Carlsbad, CA

2.3%

Seattle-Bellevue-Everett, WA

2.1%

Orlando-Kissimmee-Sanford, FL

2.0%

Warren-Troy-Farmington Hills, MI

2.0%

Charleston-North Charleston, SC

2.0%

Los Angeles-Long Beach-Glendale, CA

1.9%

Raleigh, NC

1.9%

San Antonio-New Braunfels, TX

1.9%

Portland-Vancouver-Hillsboro, OR-WA

1.9%

Riverside-San Bernardino-Ontario, CA

1.8%

Silver Spring-Frederick-Rockville, MD

1.8%

Fort Worth-Arlington, TX

1.7%

Anaheim-Santa Ana-Irvine, CA

1.7%

Denver-Aurora-Lakewood, CO

1.5%

Charlotte-Concord-Gastonia, NC-SC

1.5%

Nashville-Davidson-Murfreesboro-Franklin, TN

1.4%

Dallas-Plano-Irving, TX

1.4%

Tampa-St. Petersburg-Clearwater, FL

1.3%

Memphis, TN-MS-AR

1.2%

Washington-Arlington-Alexandria, DC-VA-MD-WV

1.2%

National

1.2%

 

 

read more…

 

http://www.realestateeconomywatch.com/2016/09/rents-cooled-in-the-third-quarter/

Is now really the time to invest in Real Estate? | Armonk Real Estate

According to a recent survey conducted by Better Homes and Gardens® Real Estate, as many as 89 percent of U.S. investors would strongly consider pursuing real estate as part of a broader investment strategy.

The same study, which was also cited by the National Mortgage Professional’s Magazine, goes on to reveal an even higher percentage of millennial investors — 96% — expressed interest in purchasing real estate for investment purposes. So I thought it would be nice to investigate these claims to find out why this does or does not represent sound strategy.

There are a myriad of reasons to invest in real estate. Likewise, there must be plenty of reasons not to invest. Let’s take a look.

Real Estate Investing: The Pros

  • The timing may be ripe. Given the uncertainty surrounding the upcoming elections, many investment managers are predicting a volatile stock market; this is regardless of who sits in the Oval Office, this January.
  • Hefty Earnings potential. When you reach the level of competence necessary to complete a deal on your own without making mistakes your earnings potential will soar.
  • You call the shots. As a real estate investor, you’re ultimately accountable to you and your checkbook. Of course, you will need to stay on top of your local coding regulations and ordinances. But once you get the hang of it, you really shouldn’t have any problems with ordinances.
  • Nurture your inner builder. Getting into the residential investment business entails lots of renovation work. As such, you can certainly expect to play with your fair share of power tools. Of course, if your favorite pastime is catching re-runs of ‘This Old House’, you probably already love using these tools. Perhaps this explains why so many contractors wind up investing in real estate.
  • A ‘hands on’ investment. Real estate investing is unique in that it’s almost as much a career or a way of life as it is a form of investing. Indeed, the fact that real estate is involves so much sweat equity makes it unique among other investments.

That notwithstanding, the hands-on aspect of buying and rehabbing homes is also why you’ll face less competition from investors than you might expect in stocks or bonds.

Real Estate Investing: The Cons

  • Substantial risk involved. The business side of real estate investing is fraught with risk. Unlike purchasing mutual funds or savings bonds, with real estate you can lose money; this is one of the reasons that seasoned real estate investors caution neophytes never to get too emotional about a property and always be willing to walk away.
  • You could pay dearly for your mistakes. Another thing that’s so different about real estate is that you pay dearly for your errors in this field. For example, if you sign a deal only to realize afterward that the numbers don’t add up – walking away is not always an option.
  • Requires a significant investment. Don’t let the late night infomercials fool you. It takes serious resources to pull off a successful real estate deal from start to finish. Hence, it’s important that you have a plan and stick to it, going into every investment.
  • Demands a well-defined skill set. For anyone used to going into the office every day and ‘punching the clock’, real estate can be a daunting field. Namely, because it requires the investor to become proficient in activities that you may not be accustomed to doing on a daily basis.

So these are the pluses and minuses. As prohibitive as the potential drawbacks might be, real estate still has the potential to offer substantial dividends – both in the form of financial rewards and in the satisfaction that comes from building something with your hands.

Hence, if you’re willing to learn the ropes and put in the effort, you should find your goals very attainable.

Should You Decide to Take the Plunge Know This

  • If you do choose to invest in real estate, don’t go in blind. Prepare a road map first. Determine what it will take to accomplish your goals for each property beforehand; this includes finances, materials, personnel planning, etc. Upon completing your plan be sure to meet with the concerned parties.
  • Always expect the unexpected. When meeting with sellers, buyers or investors be sure to expect the best but plan for the worse. There’s always the potential that the deal may fall through. Doing so will help put all other parties at ease while preventing you from getting too emotionally invested.
  • Find a good CPA and attorney. While you may already be familiar with accounting and various legalities, it helps to have a professional on speed dial in case a problem that you aren’t familiar with crops up.

It’s important to point out that I’m not here to advise you one way or another, as it relates to whether to invest in real estate or not. My job is to bring you the facts and let you decide what to do with them. That said, now that we’ve covered the advantages and disadvantages of real estate investing, what do you think?

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http://www.huffingtonpost.com/entry/is-now-really-the-time-to-invest-in-real-estate_us_57f6477de4b0568704999ef7

Small wall mounted guest bath sinks | Armonk Real Estate

When washroom space is limited, small-profile sinks are essential: Here are ten tiny wall-mounted sinks for the guest bathroom.

Above: Lacava’s 5074 Aquamedia Washbasin in white porcelain measures 10.25 by 19.75 by 7 inches; the wall-mounted version includes a towel bar; $390 at Faucet Farm.

Above: Duravit’s Happy D. Hand Rinse Basin in white porcelain measures about 20 inches wide and 10 inches deep; $180 at Every Faucet.

Above: The wall-mounted Round Ann Sink measures 15.75-inches wide and deep; $79.99 at Ikea.

Above: Kohler’s Taunton Cast-Iron White Wall-Mount Lavatory measures 14 by 16 inches; $337.99 at Plumbers Surplus.

Above: The Scarabeo Thin-Line Ceramic Washbasin measures 11.7 inches square; $350 at eFaucets.

Above: The Whitehaus Wall-Mounted Basin measures approximately 20 by 10 by 5 inches and is available with a chrome towel bar; $258.75 at eFaucets.

Above: Lacava’s Alia Wall Mounted Porcelain Lavatory SInk is 22 inches wide and 11 inches deep; $375 at Lacava.

Above: A space-saving corner sink, the white porcelain Scarabeo Square Wall-Mounted Corner Sinkby Nameeks measures 18.5 inches wide and deep; $486.50 at Every Faucet.

Above: The Duravit Architec Series Hand-Rinse Basin measures a tiny 14 inches; $241.50 through Amazon.

Above: Duravit’s Vero Basins are a modern European classic and are available in several sizes and configurations, including the approximately 10-by-18 inch Vero Handrinse Basin; $296.25 at eFaucets.

 

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