As a real estate broker, many times the conversation turns to general questions about the real estate business.
Because I am in the business, people want to ask for my opinion and advice.
Here are some of the most recent frequently asked questions that have been posed. The answers are mixed with opinion and fact.
Q: Is the market in our area changing?
A: Yes, the foot traffic has increased and we are starting to see buyers return to the market.
We have more properties in escrow than we have had in many, many months.
Most buyers are looking for a bargain. Some buyers are sensing that we may have reached the bottom of the market and have urgency to buy in the event prices start to rise.
Q: Where do you see the real estate market headed?
A: Either up or down. The supposed experts did not predict this market fall, so it is difficult to predict the future of the market.
I wish I had a crystal ball, but I don’t. One thing certain is that all real estate is local, so each market should be evaluated on its own characteristics.
Q: Would you buy real estate today as an investment?
A: Definitely. While I don’t know in the short term if prices will rise or fall, a long-term hold seems favorable at these price levels.
Mario Gabelli, a financial guru, has made a fortune by analyzing asset values of companies and buying those whose stock was priced well below asset value. If you look at today’s real estate prices, a lot of properties can be purchased well below replacement cost and with a positive rental income. Seems like a good long-term value if you can buy below replacement cost and have positive cash flow in the interim.
Q: If you were going to buy a home today, would you buy a foreclosure, bank owned, short sale, or a non-distressed property?
A: The answer to this is the same answer an attorney usually gives you — it depends.
I almost would never buy a foreclosure. It is far too risky because in almost all cases you are buying without inspection.
In addition, many foreclosed properties sell for less once they have been repossessed by the lender.
As far as bank owned, short sale, or a non-distressed property, they all have to be evaluated on a case-by-case basis. Because of the competitive nature of the real estate market, non-distressed properties may be a greater value than a bank owned or short sale property.
Ray Pugel is a designated broker for Coldwell Banker Bishop Realty. Contact him at (928) 474-2216.