I just had it happen again today.  Property has been on the market for 75 days.  I checked with the listing agent last night, no offers.  We wrote up an offer and I sent it in around noon today.  He writes me back at 2pm and says he now has 2 more offers.  What!?!#@%

This has happened to my customers more times than I can count.  Many of them think that there is some sort of conspiracy going on.  Maybe the listing agent calls all his customers/friends and tells them about our offer.  Maybe there are a bunch of lurkers out there that find out there is an offer coming in and pounce on it.  Kinda like waiting till the last minute on an eBay auction to put in your bid.

While it may be easier to use these conspiracy theories as an excuse/reason that we are now in multiple offers, I doubt that this the case.  I have seen this happen with dozens of different listing agents on dozens of different houses at all price points.  I can’t believe that all of them are calling their friends when they receive our offer.  Frankly, many REO agents are so busy you never even hear from them, just their assistants.

Here is my alternative theory:  I suspect that we are not alone in our search and that the same event (price change, new property on market, new month, solar flares, eclipse, etc) that triggered us to look at and then write an offer on a property happened to others.  Think about it.  The above property had been on the market 75 days.  Why didn’t we look at it and make an offer at 50 days?  Reason:  It was too high priced.  Why not at 60 days?  Reason:  there were other/better deals out there.

While this will sound a little coarse, I think you could look at it like the home buyer (whether investors or owner occupants) travel much like pack animals.  A heard of zebras all walk in the same direction to the watering hole that is 10 miles away, not really knowing who is leading or which exact direction to walk, but they get there at the same time.

Well, this is just my $0.02.  You can take it or leave it.

As we all know, in certain areas, vandalism of vacant houses is almost expected.  When I am touring some neighborhoods, I am almost surprised when the copper water lines have NOT been stolen.  I saw a house in North Minneapolis a couple years ago that had something that looked like steel plates over the windows.  I should have taken a picture, but I was amazed at the security of it.

This is not an advertisement for this company, but I recently received an email for a company that will secure your property using these lightweight metal panels over the doors and windows.  Their website says that there is no nails or screws used to secure the panels.  I am guessing they must open the window/door and then use a bar across the inside to basically clamp the panel to the opening?

I have no idea what this costs (it appears you lease the panels and pay for install), but what a cool idea.  In fact, I was thinking that the homeowners down in hurricane and tornado country should own a set of these they could install in an house or so.  No more plywood (or better, no unsecured houses).

**Update:  See the below comment from EG, who tried these locks.  In retrospect, I was wrong on this article.  Paying more for locks is the smart thing to do, because I have found that the front doors on my rentals take a lot of abuse.  A cheap lock is going to just result in many services calls.**

So even after being an investor for this many years, I still learn something occasionally.  It can either happen because the world has changed or maybe my view of the world has changed.  This is a small one, but it was definitely a Homer Simpson “Duh” moment with the traditional slapping of the forehead.

As I bought all my rental properties years ago, I made a point of changing all the lock sets. I standardized on a Quickset deadbolt and then I would always remove the locking knob (so that no one could lock themselves out-requiring me to come over with a key).  I bought the locks from a little locksmith in NE Minneapolis on Central. They were very helpful and as I was a newbie landlord, I had not been in the trenches very long.  I had all the locks keyed with a master figuring that it would be easier to open and change them out if all I needed was one key.  Unfortunately, this locks and the master key system cost me about $55 per deadbolt.  To me this seemed like the right way to do it.

Yesterday I was working on a new listing and realized my inventory of lock boxes was at zero.  I had heard of REO agents getting cheap lock boxes on-line for 50% the price that you pay at Home Depot.  I found the site and while I found the cheap lock boxes, I had that paradigm, “DUH” moment.  Here are deadbolts that I see on every foreclosure home that I go into.  They cost $3.

I could have purchased 14 of these for every one of those expensive deadbolts.  Frankly, I have paid more than $3 for just new keys in the past!  This paradigm shift could have allowed me to have boxes of locks with keys and very easily (and less expensively) changed them out simply.  I always try to run my rentals better than most landlords, but here is a situation where I was wasting money.

I guess the moral of the story is to stick your head up occasionally, look around and see if there is a better/cheaper/faster way to manage your properties.

Oh boy!  Great statistic if you are an investor (more cheap house coming).  Not good if you are a retail seller or you flip houses.  CNNMoney.com reports that there were 2.1 million homes that are very seriously delinquent or in the REO bank’s inventory, but have not been released to the market.  They are just sitting waiting for the right time.

Add that to the existing inventory and we have 6.3 million homes for sale, or 23 months worth of inventory.  As a comparison, a normal inventory is 6-7 months worth (we saw 3-5 months in 2002-2005).  With all that inventory coming, experts are predicting that home prices are expected to dip another 8% before they start to clime (unfortunately, they didn’t say when the 8% decline would end).

Read more of the article here.

For a while now I have been using our own title company when my customers are purchasing foreclosed properties.  This is all despite the contracts “requiring” that we use their title company, which is against the law.  Here is a great email that Charity at Trademark sent out:

Associates,

In the last couple of weeks it has been brought to my attention that the title companies representing the banks have taken it a step further now. They are not just trying to fairly compete for the buyers business they are actually calling the selling agent and using scare tactics on them.

Most recently, the title company called a Selling agent telling her that the Buyer HAS NO CHOICE and must use them to close because the contract was written that way.  PLEASE do not allow these title companies to bully you or your buyers into closing with them, THIS IS AGAINST MINNESOTA LAW!

Another instance, the same title company as above called the Selling agent and told him the Buyers would end up paying $900 more to close with Trademark than with them. NOT TRUE!  We offer special pricing for buyers of bank owned properties.

Last week a very reputable title company who has now started representing banks sent us multiple emails stating the Bank won’t send the deed back unless the Buyer uses this title company. Again, THIS IS AGAINST MINNESOTA LAW!

Please, don’t be fooled by the latest tactics, if in doubt CALL A TRADEMARK CLOSER!

According to the Metropolitan Foreclosure Report by RealtyTrac, Inc, the Twin Cities real estate market saw an increase of new foreclosures filings by 22%.  This is a 2% decline actually from the last quarter of 2009.

Before you investors start salivating….Keep in mind that even though a foreclosure filing happens on a property, several things can happen.  The owner can pay the past due amount and fix the problem.  They can sell it in a short sale.  If neither of those happen, we need to wait 6 months for the end of the redemption period for the properties to hit the market.

The staggering numbers from the report show that one in every 162 houses in the Twin Cities (only .62%) has at least one foreclosure filing in the database.  This is slightly lower than the .72% national average.  The Twin Cities ranked 80th on the list of large cities (over 200k people) in number of foreclosures.  Of the top 10 cities with the worst foreclosure rates (like cities in California, Florida, Arizona), eight of them reported improvement in foreclosure filings over last year.