More Fuel For the Fire

As most real estate agents do, I look at listings every day. I'm always eyeing potential deals for my clients. In doing so, I've noticed recently that there are many that either expire (i.e. the listing time limit runs out and thus the listing agent looses the right to sell the property as per the listing contract) or they are withdrawn explicitly by the seller. Either way the property goes off the market.

In times past, agents would simply resign up their client and maybe make a few improvements to the property, do some snazzy advertising or even once in a great while lower the price to some catch-all price (say $599K) and they masses would converge and some brave sole would step up to the plate and buy the darned property. Then everyone would say: "What an idot. That property isn't worth all that money"

Ahh, sellers don't have it so good. OR DO THEY? Because, I'm the kind of a guy that wants to know why and how things work (even markets, I just can't get that engineer midset out of my head), I ventured to call some the the loosing agents. "What's up with that property?" I ask. "When's it comming back on the market?". And the new answer? nope, its not: "next week at a lower price", its more like this: "The owner rented it out and is not going to sell [sigh]". So for all of those people who are waiting for the onslaught of bank forclosures on the brave soles I mentioned above who held their noses and bought the properties that the masses thought were overpriced, well keep waiting.

You see this is more evidence that rents are going up. Many of those who have bought in these headdy days gone by now, are doing just fine. As interest rates are easing back down, I think that a good deal of those people on the edge can refinance and raise their rents and keep it in the black for the next 10 years.

I guess the lesson to be learned, is keep a cool head about you. Don't panic, if your gonna sell, sell for a good reason. Otherwise, keep growing that portfolio of properties. Prices have certainly cooled off in the last year, and as rents continue to rise, and interest rates increases settle down a bit, I see some good opportunities for those with the mind to take advantage.

One more 2 cent opinion from Mike