Boomer’s Blog

I’ve been hearing a lot of buzz about the future of the markets from real estate gurus, zealots and cynics. And with all the insanity we’ve seen on Wall Street over the past several months, it’s no wonder why everyone’s talking. But since a lot of folks I’m hearing from seem to need some help separating fact from myth when it comes to talking seriously about the future of U.S. real estate markets, I thought I would share my thoughts with the community on this Blog.

The Best Moneymaking Facts Often Hide in Myth
Let’s say a ship is in the ocean and is absolutely loaded with gold. And it hits an iceberg and sinks all the way to the ocean’s floor. Does that gold disappear? Of course not. It’s resting at the bottom of the ocean. So the trick is to get to the gold without drowning.

To get you started on your search for real estate gold, lets try a little exercise to distinguish the difference between Fact and Myth in today’s changing real estate game.

Are These Statements of Fact or Myth?
Evaluate these widely circulating statements. I’ll give you my opinion, but at the end of the day, what you believe could make — or break — your future in this business.

• Statement: This is one of the Worst times Ever for Real Estate Investors.
• Myth: This is one of the best times ever for real estate investors. We’re currently in what’s called a net zero gain. Money, in this case $1 trillion has not been lost, it’s just changing hands.  The trick is figuring out how to get in on that.
• Statement: Real estate investors are buying properties in every part of the United States for .45 cents on the dollar.
• Fact: REI are able to buy properties at these prices – and lower – especially if you’re working in some of our California markets right now.
• Statement: You need cash and credit to buy real estate in today’s changing markets.
• Myth: That is absolutely a myth. You don’t need any cash or credit to buy in today’s down-turning markets.

Get the Lowdown on Separating Fact From Myth
The reality is, there are some red-hot  strategies right now that’ll turn your spreadsheets green — and your competitors green with envy.

At GaryBoomershine.com & SalesTeamLive, we’re always busy working to deliver -– directly to your desktop — the latest strategies to emerge from the best and the brightest minds in the business.

We’ve got the latest tips and tools that are sure to fill your ship with gold. But we also offer solutions such as SalesTeamLive’s Done-for-You Marketing that specifically are designed to keep you from hitting that iceberg!

See for Yourself: We Set the Standard for Beating the Competition and Boosting Your Profits

• Take this week’s online multi-media extravaganza with Ken Wade for example: Wednesday night at 9:00 p.m. EST, we’ll we blowing the lid off of the secret cycles that rule the U.S. real estate markets. (For more info, check out my my review in the resources section of GaryBoomershine.com.)
• Coming soon, we’ve got Larry Goins on tap, waiting to tell you his best-kept secrets for making tons of cash in real estate.

We Give you the Facts, so You Can Leave the Myths Behind
These special events are absolutely free and are available on a first-come, first-served basis to folks who join GaryBoomershine.com. All you have to do to make sure you can participate is register ASAP using the yellow fields on the right side of this page, or on the bottom right-hand side of the main page at GaryBoomershine.com.

We’ll send you all the details you need to participate in the money-making events that’ll give the edge you need to build your future on facts instead of myths. Join us in your search for Real Estate Gold!

Claim Your VIP Pass to Moneymaking Real Estate News, Marketing, Strategies & Tips
At GaryBoomershine.com, our focus is on delivering the the most timely real estate news, resources, tools and systems that build stronger real estate investment decisions and boost your bottom line.

Sign up either here or on the main page at GaryBoomershine.com and you’ll get the best this industry has to offer in real estate news, real estate marketing, real estate training systems, and all the creative real estate ideas that drive success in this business. Members also get exclusive access to compelling multimedia content and jaw-dropping discounts!

Don’t miss out on this opportunity to Make Tons of Cash in Real Estate! Join GaryBoomershine.com today and race ahead of the pack!

While home ownership rose as the housing bubble inflated, the foreclosure epidemic and distress on Wall Street are forcing droves of Americas into the inhospitable arms of the nation’s shrinking home rental markets.

Reports Show Growing Demand for Rental Housing
According to two recent studies, the latest trend to hit the U.S. housing market is the search for affordable rental units. Real estate entrepreneurs who engage in the landlord game these days can anticipate bargains on rental housing and enjoy steady cash flow from their investments as markets stabilize and home prices limp towards a steady recovery.

While investing in rental properties is an excellent way to buy and hold properties and ensure cash flow, it is important to carefully research the full range of important decisions you’ll confront as a landlord. Among these considerations is the critical decision of where you’ll invest, going rates for rents and whether local economies support those prices. But first, here’s a little background on the facts to get you started.

Have Your Cake and Eat it Too …
In recent years, despite the emphasis on homeownership, renter households have grown to comprise more than one-third of the households in the United States. With a growing number of households currently vying for affordable  rental housing, real estate entrepreneurs should consider this investment strategy for generating immediate cash flow and building long-term wealth.

Investors, Renters Hit by Mortgage Meltdown
It is important to note however, that this strategy does carry some risks and that many investors have been burned by bad financing decisions and by miscalculating market values. The National Low Income Housing Coalition cites March data in estimating that at least 38 percent of foreclosures involve rental properties, and this has affeced more than 168,000 households. According to the same report, roughly half of the recent foreclosures in Nevada, Illinois, and New York involved rental properties.

America’s Rental Housing- The Key to a Balanced National Policy, a  report on rental housing market dynamics from Harvard University’s Joint Center for Housing Studies shows in detail how The mortgage meltdown has permeated U.S. home rental markets.

Surge in Demand for Rental Housing Escalates

Rising costs of living, mounting debt and the credit crunch are road blocks to a growing number of  renters searching for affordable housing. In today’s rental markets, competition is fierce for low-cost rentals and the threat of sudden eviction imperils droves of renters who are unwittingly living in distressed properties.

To make matters worse for renters, high foreclosure rates are adding to the number of rentals held off the market because of bad paper log jams in American financial institutions. Current and aspiring landlords can learn a great deal about tenants and emerging market opportunities by casting a gaze on the facts contained in this report.

Mortgage Crisis Impact on Rental Markets

• In 2004, some 240,000 subprime home mortgages were seriously delinquent or entering foreclosure, by 2007, that number rose to 750,000.
• Over 12 percent of all subprime loans were delinquent by the end of 2007, compared to 1.7 percent of prime loans.
• Serious mortgage delinquencies and foreclosures have been rising in Ohio, Michigan and Indiana for more than a decade.
• In 2007, nearly 20 percent of all foreclosures were on loans made to non-resident owners.
• While the weak home buying market is expanding the supply of higher-priced rentals, most renters can’t afford them and the market has limited ability to absorb the current excess supply.
• After averaging just 0.7 percent annual growth from 2003 to 2006, the number of renter households jumped by nearly 3 percent, or one million, in 2007.
• Between 2003 and 2005, nearly 2 million homeowners became renters.
• The mean debt of renters in the lowest income quartile surged 62 percent from $3,200 in 1995 to $5,200 in 2004.

Rental Production and Supply

• In 2007, completions of multifamily units for rent fell to 169,000 units—just two-thirds of the 2002 figure and only one-third of the 1986 record high.
• From 1996 through 2005, 1.2 million of the 3.2 million rentals completed were in structures with 20 or more units, and another million were in buildings with 5–19 units.
• Meanwhile, completions of rentals in structures with two to four apartments totaled only about 200,000, while site-built and manufactured single-family homes added another 733, 000 to the market.
• The median rent for newly built apartments in buildings with five or more units stood at a record high of $1,057 in 2006—well above the $766 median gross rent for all units and up more than 30 percent from mid-1990s levels. As a result, only 20,000 new unfurnished apartments renting for less than $750 were completed in 2006, despite being the types of units in greatest demand.
• The combination of record-low interest rates, rising occupancy rates, and attractive yields helped to lift sales and prices of apartment complexes starting in 2003. Hefty increases in net operating income brought in even more investors, with property prices advancing 50 percent from 2003 to 2007.
• The number of units in large multifamily properties that were converted from rentals to condos rose from a few thousand in 2003 to 235,000 in 2005—more than the total new multifamily rental completions in that year. However, conversions fell to only 60,000 units in 2006 and had virtually disappeared by 2007.

Rental Affordability

• The national median gross rent rose 2.7 percent in real terms from 2001 to 2006 while the median renter income fell by 8.4 percent.
• Nearly half of all renters paid more than 30 percent of their incomes for housing in 2006, and about a quarter spent more than 50 percent. Full-time employment is no guarantee that a household can afford rental housing. In 2006, 42.6 percent of all working families did not earn enough afford an appropriately sized housing unit.
• Seniors and others unable to work who have basic Supplemental Security Income (SSI) are especially likely to face high housing-cost burdens. Nearly 2.5 million senior renters (53 percent) pay more than 30 percent of their incomes for rent, while 1.4 million pay more than 50 percent.
• From 1995 to 2005, nearly 2.2 million (or 6 percent) of all rental units were demolished or otherwise permanently removed from the inventory, including 1.4 million units with inflation-adjusted rents of $600 or less in 1995. Loss rates of single-family and small multifamily rentals are more than three times those of units in large multifamily buildings.
• Between 1995 and 2005, two rental units were permanently removed from the inventory for every three units built. Inventory losses were highest in the Northeast, where two rental units were lost for every one built.

Research and Recommendations
To learn more about renter and market demographics in your target area, the National Low Income Housing Coalition has written “Out of Reach” a report that provides a side-by-side detailed comparison of wages and rents in counties, cities and nonmetropolitan areas throughout the United States.

For each jurisdiction, the report’s database calculates the amount of money a household must earn in order to afford a rental unit at a range of sizes  at each area’s Fair Market Rent (FMR), based on the affordability standard of paying approximately 30 percent of household income for housing. It also provides quick access to U.S. Department of Housing and Urban Development (HUD’s) data on fair market rent in these jurisdictions.

Though these reports are excellent research tools, it is important to consider the wide spectrum of responsibilities that come with being a landlord.

Though landlording is an enduring investment strategy, and can be a great way to buy and hold properties, it is not an effortless endeavor. In this arena, it’s critical that investors carefully consider costs, markets, local landlord tenant laws and potential administrative burdens associated with being a landlord. Based on experience, I also recommend that anyone considering becoming a landlord should look into the advantages of finding and hiring a good management company to minimize your potential headaches as a landlord.

Where else can you learn how to find and flip distressed real estate using just your laptop and cell phone but on GaryBoomershine.com? If you missed my dynamic conversation with Virtual Wholesaling pioneer Cris Chico last week, we’re offering you a second chance to learn what the experts already know about this innovative strategy to generate awesome returns on your real estate investment (ROI) dollars today.

Now Available by Popular Demand
If you’ve joined the GaryBoomershine.com community by signing up up for my “What’s Working & What’s New” monthly and special reports, or if you’re a SalesTeamLive member, chances are good that you’re among the hundreds of real estate entrepreneurs who listened in awe last week as Cris told his his story and revealed the secrets behind how he made his real estate fortune. Using his own system, Chris went from having his sports car reposessed, to flipping 116 properties and making more than $1.4 million in profits in just two years.

Because I’ve heard from so many folks who were unable to listen in on our live Internet broadcast last week, I’m posting the call online for those of you who missed out on this awesome opportunity to learn how to make real money in virtual real estate wholesaling using just your laptop and a cell phone.

Emerging Opportunities to Cash in on Distressed Real Estate
Wholesaling is one of the hottest investment options today for real estate investors seeking to crack the code on generating fast cash while investors in other sectors are loosing their shirts. With wholesale real estate deals, investors place a property under contract and then assign the deal to another buyer who closes in the investor’s place. Because real estate investors usually never put any money down or close on the property, risks are minimized and profits are immediate.

Cris’ Virtual Wholesaling system takes the wholesaling process to the next level by leveraging technology to laser-target wholesale investment properties in any market real estate entrepreneurs choose to penetrate. (Read my full review: “Virtual Wholesaling with Cris Chico.”)

With user-friendly advances in technology that are built into Cris’ virtual wholesaling system, the power to hone in on the best neighborhoods is far superior than the “no pain, no gain” techniques that were popular in the past. Using Cris’ system, investors can laser-target areas and build lists based on the best possible case scenario for virtually any market. Cris’ system teaches investors how to prosper and make tons of cash in the current housing crisis. If you can use email, you can use Cris’ innovative system for fast, no-money-down profits in your REI business.

Tap new Markets and Boost your Bottom Line
Though the real estate bubble may have burst in your locale, there are a lot of U.S. real estate markets that are not currently suffering because they weren’t affected by the boom. Since their prices never rose when the market was jumping, they’re not dropping now that market conditions are changing.

Cris can teach you how to profit from these market uncertainties. He also is extending killer special offers to members of the GaryBoomershine.com community and SalesTeamLive members, respectively, that are packed with awesome incentives including a ticket to the upcoming Virtual Investing Seminar in New Orleans slated for June 26-29. By following the links above, you can check out the details and read the awesome client testimonials while you’re listening to the call.

Invigorate your REI Business: Join us Today!
If you haven’t yet joined our thriving on-line community, and are interested in in learning more about how you can cash in on the latest news and developments that drive our industry, please sign in now using the yellow fields at the right side of my GaryBoomershine.com home page. Like always, I pledge to never share your contact info with anyone or inundate you with useless messages. Of course, you’re welcome to listen to the call, even if you don’t want to join us in building a strong community and sustainable future in creative real estate investing. Sometimes we all need a little nudge in the right direction! Let this be yours.