Well, I came up with an idea yesterday for creating a new niche in the Hemet - San Jacinto Real Estate marketplace - one that I believe no one is targeting. You can read the general outline of this untapped market at the article I published, called - 2010 - Creating a New Niche in the Hemet - San Jacinto Valley, CA Real Estate Marketplace.
Well, this has been consuming brain cells in the back of my brain and with some simple playing around this morning - I have figured out how to identify those who fall into this market...and it was very simple, too.
In my MLS we have access to ReaList - this is a Title product supplied to the MLS, free to the members, that gives us access to basic property information. Well, ReaList has a feature I've used a handful of times, and almost forgot about - I can search for properties that meet my defined criteria - sort of like an MLS search.
So, I plugged in the criteria of homes that were purchased prior to the end of 2003. I started with a 20 year search and had the max 1,000 results returned. Well I tried several more times until I got down to a 5 year spread which returned 958 records.
I exported this data to an Excel Spreadsheet and started manipulating the information of San Jacinto Homeowners who bought their home pre-bubble, when real estate only increased in value at a ‘normal rate' of 3% to 5% per year. (seems strange, doesn't it?).
I ended up adding a couple of columns to the report and did a couple of basic calculations that showed the cash difference between the first mortgage and the assessed value - which in California is typically the purchase price plus 2% per year, compounded. For my early planning stages, I can assume this is close to the amount of cash the San Jacinto, CA homeowner put down on the purchase of the home when they initially bought it. I then divided this amount into the assessed value for a percentage and this gave me an idea of what percentage in equity they have.
INTERESTING OBSERVATIONS OF THE 958
- 165 of These Homes Do Not Have a Mortgage (17.22%)
- 51 of These Homes Have 50% or Better Equity in Their Homes (5.32%)
- 36 of These Homes have between 40% & 49% Equity in Their Homes - My Bottom line criteria to pursue (3.75%)
- 279 of These Homes Have NEGATIVE EQUITY - Based on Assessed Value (29.12%)
- 427 of These Homes Appear to Have Less than 40% Equity - Based on Assessed Value (44.57%)
- 123 of These Homes Have a Second Mortgage (12.4%) of Which ONLY 4 fall into my 40% and Above Criteria (0.04%)
So I have some more searching and my number crunching to do. I plan on going back 20 years total and checking out both Hemet and San Jacinto real estate that will hopefully give me a data base of 1,000 home owners that I can show how they have equity and why now may be the best time for them to ever move up - it's all about moving up in a down market.
2010 is going to be a GREAT YEAR!
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