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Forcing Inflation...Buy signal?

By
Real Estate Broker/Owner with Sherwood Property Investments

Today are the Mid-term elections.  Debates, finger-pointing, even rants abound.  The results could be pivotal for our nation.

And the next day, Ben Bernanke and cohorts announce their new unabashed money printing, trying to fuel inflation again...better than the kind of 20-year deflation Japan has been experiencing they think, most certainly. 

What does inflation do?  It makes everything cost more tomorrow than it does today.

The results...folks have a new urgency to spend now rather than pay more later.  Freezers get stocked. Cars get bought.  Folks stop wondering about the housing market and they just buy...before interest rates go up, before the cost of housing goes up.  Jobs are created. 

And, on the downside, stuff costs more.  Folks on fixed income get hurt.  Even folks on low income get hurt.  Inflation is kind of like a equal opportunity tax.  Everyone pays it, it just hurts some more than others.

What to do about it?  It seems pretty assured that interest rates are going to start to climb soon.  That means even if the cost to buy housing remains the same, the cost to own is going to go up.  Rents may increase, as costs for taxes, insurance, water, heat and - yes - interest go up.  Might be a good idea to stop stalling and just buy

Of course, that is the main idea.  It is widely believed that the housing collapse fueled the current  economic problems.  And in part at least it did.  (Of course, you can go back and play the blame game, but who needs that right now?  What we need is to regain economic health!  Once elections are over, hopefully we can unite to do just that!)  And perhaps a housing recovery will help the entire economy.

What about the 'Shadow Inventory'?  A good time to talk about shadows at Halloween, isn't it? 

Yes, it is there.  BUT, funds are climbing all over it, recognizing the opportunity.  Foreign investors can't believe the deals they can get right now. Domestic investors are glomming it up.  New homeowners, sometimes tentatively, are buying.  But they are scared.  DON'T Miss Out! 

I know I am getting involved in Bulk REO's and Non-Performing Notes now.  What an opportunity...not just for profits, but

-to help bank liquidity by getting rid of toxic assets

-to transform neighborhoods by moving vacant and decrepid homes into hands of local investors who can redevelop housing for local folks

-to provide jobs for contractors, realtors, appraisers, hardware stores, fabricators of housing rehab materials

-to give folks a viable place to invest besides 1% interest in Money Markets and CD's to invest, with security and upside potential

To learn more about Bulk REO's, please go to www.SherwoodAcquisitions.com and register.  We are getting product daily.  Let us know what works for you, and we will do our real estate match-work.

Comments (4)

Nor Yeretsian
Envoy Capitol Realty Inc. - Toronto, ON
Envoy Capitol Realty Inc., Brokerage Toronto

Thanks Annie for the interesting article.

Cheers

Nor Yeretsian

Nov 01, 2010 05:32 PM
P.J. Virgilio Jr., Realtor 408-568-6578 Selling homes in the Greater San Jose area and South through San Martin, Gilroy
Keller Williams Realty Silicon Valley - Gilroy, CA
San Juan Bautista and Hollister as well!

Annie,

My feelings exactly.... spot on!

Nov 01, 2010 05:36 PM
John Puplava
ABC Home Inspections,L.L.C. - Prescott, AZ
ABC Home Inspections,L.L.C.

Annie---What you have to say was very interesting here. I'm going to wonder about Shadow inventory. Because I really want know how much their is?

Nov 01, 2010 05:41 PM
Larry Lawfer
YourStories Realty Group - Newton, MA
"I listen for a living." It's all about you.

Annie, you were on a roll with this blog, you need to follow up.  I spoke with a senior level BOA person who said there is very little shadow inventory.  The name was created by the media, but the banks feel as though they should move slowly rather than glut any neighborhood with too much inventory at a time.  You are right it is a mess.  I would love to hear your 2011 take on this.

Jan 14, 2011 12:45 AM