IP201 Seminar: Everything you wanted to know about financing investment properties, but were afraid to ask

Don’t let the news reports fool you.  Banks have money to lend.  Rob Bonahoom, a mortgage banker who specializes in investment property financing, with 15 years of experience, will explain what options are out there for buying investment properties.  Whether you are looking at a single family home that needs renovation for a rental, a 50 unit apartment complex, a home in the suburb that you want to flip, your first rental or your 20th property, Rob has a financing option for you.  Come and ask your questions in a non-threatening environment with no sales pressure.

This seminar will be held in Bloomington at 6:30, August 14.  Register for the seminar by filling out this quick registration form or call 612-281-5419 for more information.

Got Financing?

Buying investment properties requires having relationships with many professionals:  Realtor, Attorney, Property Manager, and Mortgage person.  I have found that ultimately, the one person on your team that will make or break your success (for the most part) will be your mortgage person.  They are the link (or the roadblock) to getting you one or 10 properties.

I have been working with Rob Bonahoom for many years now.  He is one of the few mortgage brokers in the area that specializes in working with investors.  In fact, he has 15 years of experience doing just that.  Rob and I were talking today and I don’t think many people know that Rob has access to just about any type of financing that you need including:  rehab loans, Fannie Mae, small loans (less than $50k), commercial loans (to your LLC or for larger properties), and portfolio loans (where his bank loans you the money, not some other entity out in the secondary market).

Here is just an example of his rehab loan program, which my customers have used probably 100+ times:

• They offer 100% financing of the purchase price and renovation costs
• Close as quick as 2 weeks
• Be your own general contractor
• Their philosophy-save your cash to optimize your purchase power
• Fixed rate conventional end loan as soon as 30 days after renovation is completed

So before you go anywhere else, give Rob a call, 651-485-3710, and see what he can do.

Edina Realty & Realtor.com

By Errol Samuelson, President Realtor.com

Last fall, Edina Realty announced it would stop displaying a portion of its listings on third-party real estate web sites.  As of next week, we will no longer display Edina Realty listings on Realtor.com with one exception – we will continue to display listings for Edina Realty agents that have a direct advertising relationship with Realtor.com.

As a result, most Edina Realty listings will no longer be displayed on Realtor.com, MSN Real Estate, AOL Real estate, or our award-winning and market leading mobile apps for the iPhone, iPad, Android and Windows Phone 7.  Similarly, Edina Realty listings will not appear on the soon-to-be launched Realtor.com video-on-demand TV channel.

Our position

Do I think Edina Realty has made the best choice?
No.
Our audience complements the audience that Edina Realty reaches through its own website.  Moreover, Edina Realty agents and home sellers will miss out on exposure to our national audience of more than 20 million monthly unique users (including 282,500 potential buyers from the local markets served by Edina Realty – users that spent an average of 14 minutes on our site in April looking at local properties).  The Realtor.com Network has the largest consumer audience in Edina’s marketplace, an audience that will no longer be reached by Edina Realty.

Last November, when Edina Realty announced their plans, we identified four main concerns.  None of these apply to Realtor.com:

1.)     Edina Realty expressed frustration that third party aggregator sites were building audience using their inventory and then allowing For Sale by Owners to advertise to this audience.  Realtor.com does not allow FSBO listings.

2.)     Edina Realty raised the concern that third part aggregators do not accurately update their listings and data.  Realtor.com listings are sourced directly from the MLS and are updated every 15 minutes to 24 hours every day directly by our MLS partners.

3.)     Edina Realty was concerned that competing brokers’ and agents’ photos and branding were appearing on their listings.  This is a practice Realtor.com does not engage in.

4.)     Edina Realty did not wish to see any lead generation products on their listings.  Realtor.com provides brokers with choice on how their inventory will be presented and the Edina listings were configured so that no lead generation products appeared on their listing.

I believe we’ve been a good partner and have added value that will be missed by Edina Realty agents, their sellers, and, in time, the company itself.

Would I prefer to continue our relationship with Edina Realty?

Of course. Helping agents and brokers reach a broad and diverse consumer audience is why we’re in business at Realtor.com.  And frankly, not displaying these listings means we now offer a reduced user experience to buyers and sellers in the affected markets.  It also now means Edina Realty agents who want their listings on Realtor.com can only do this via paid advertising and not through our free basic listing products.

However, these things said, I want to be absolutely clear: we respect Edina Realty’s decision.

We’re not going to play games with their agents, or try to compromise their standing with consumers in their market.

In the months following their announcement last fall, executives at Edina Realty shared some of their strategy with us.  And while I leave it to them to articulate it fully, I understand it is based in large part on a desire to channel as many consumers as possible through their own website.

I don’t believe this is the best strategy.  I believe that consumers are using a variety of mediums to learn about real estate and that restricting information to a single channel will not modify consumer behavior.  Having said that, I also believe brokers should only display listings on sites that respect their rights.  But this doesn’t mean pulling listings from all sites.  There are sites with significant audience, including Realtor.com, MSN, and AOL, which meet this standard.  The key is for brokers to work with partners who deliver a large consumer audience and respect their intellectual property rights.

Onward

There has been a lot of conversation and a measure of controversy over the past year about listing syndication.  In addition to operating the Realtor.com Network in a way that respects broker rights and concerns, we’ve made significant investments in tools to help brokers manage syndication.  Our ListHub division provides the industry’s largest syndication platform and now is the standard at more than 400 MLSs.  Last month ListHub upgraded its system to enable brokers define business rules (e.g., “no resyndication”  “remove expired/sold listings in a timely manner” and so on) and only syndicates listings to sites that honor these rules.  This free product is being used by more than 43,000 brokers around the country.  We are committed to leading the way by operating our sites in an industry-friendly manner, and help brokers manage, rather than pull away from syndication.

As someone who has been in this business for nearly twenty years, I try to keep it all in perspective. Debates, disagreements, and even episodes like this where I’d prefer to see a different outcome have always served to concentrate my energies on delivering value to our customers.

Today, all of us at Realtor.com share that focus.

Where Have You Been?

I got a call from a friend and former client last week.  He asked:  ”Where have you been?  We haven’t heard from you in months”.  Well, he was right.  It has been almost 6 months since I posted on my blog and almost 9 months since I sent a newsletter out.  I decided it was time to update him and now everyone else.

Many of you know that I was originally in Information Technology before I came into real estate.  My last position was Sr. Director of IT for Caribou Coffee.  During that time I had purchased a large number (28) of rental units which required a fair amount of time and I had burned out on corporate politics.  I wanted a change and decided real estate was going to be it.  Thankfully, God gave me the ability to succeed in both technology and real estate.  That was 6 years ago.

Last summer I made the decision to take somewhat of a sabbatical from real estate.  I wasn’t quitting, but I just wasn’t going to pursue a large number of new clients.  I suppose it was like the Jerry McGuire movie that I wanted to focus more on just a few clients that I enjoyed working with.

At the same time, I found an opportunity to do consulting for a start-up software company in St. Paul.  I thought it would be fun as I had never worked in such a small company (only 12 people).  Could this be the next Google?  The pay was terrible, but they offered a truckload of stock options.  I was in.  Unfortunately, once I was an insider, each week I watched the CFO sweat to make payroll and pay bills.  I could see why the pay was terrible!  Eventually, sales weren’t there and we parted ways after about 6 months.

That short, but very eye-opening experience introduced me to many IT professionals and it lead me to a new IT consulting gig, which I start this week, at US Bank.  Pay is better, work is super interesting, and it is about 4 months long contract.  After that, who knows.

During this same time, I took the opportunity to spend more time with my wife’s business, Mama’s Happy.  In January, we purchased a 120 year old barn for her store which will eventually become our home, too.  I have been having fun renovating and designing our living space.  Throw in a trip to Dominican Republic for my wife’s 40th birthday party, coaching my son’s baseball, attending countless other sporting events with my 3 kids, and generally slowing down to smell the roses; I don’t know where the time went!

With all that said, I still consider myself full-time in real estate.  I love helping both buyers and sellers.  If you have any needs, questions or thoughts, just call or email.

Free Investment Property Seminar

Have you been watching your neighbors and friends taking advantage of these low housing price and interest rates to invest in real estate?  Are you finally ready to get started, but have no idea where to begin?  Start by attending our free investment property seminar.  We will give you some answers to your most frequently asked questions about how to buy, what to buy, and how to finance it.

Best of all, there is no hidden fees, tapes to buy, books for sale, or anything else.  Just information!

These 1 hour seminars are held in Bloomington at 6:30 in a casual atmosphere.  Register for the seminar by filling out this quick registration form or call 612-281-5419 for more information.

Foreclosure Rates Stay Steady, but Serious Delinquencies Decline

We have not seen the bottom of this foreclosure market yet.  This is especially true in the winter season and an uncertain political climate.  While there is a bright note that the FHA has once again waived the Anti-Flipping rule to allow people to rehab homes and sell them quickly there are other gloomy stats.

CoreLogic’s Home Price Index shows a 4th straight month of housing price declines for November.  Prices fell 1.4% from October and are down 4.3% year over year.  Most of this decline is being driven by dropping prices on distressed properties (foreclosures and short sales), but if you remove them from the equation, retail homes still fell 0.6% in November.  Year over year, retail prices are up only slightly (which is actually decent news).

On the foreclosure front, serious delinquencies (mortgages that are more than 90 days past due or actually in foreclosure), declined to 9.3% in December.  This is down from a high of 10.4% in December 2009.  Foreclosures have stayed steady at 5.5% for 3 quarters ending June 2011.

In my opinion, we are seeing the market trying to figure out what to do.  I am not sure there are any other homes that can go into foreclosure in masse.  While we will see a steady stream, I think the flood is over.