I've heard enough about how home sales are "inching" up, considering how many of them dropped by feet or yards within the past five years. There are still too many areas where current home prices continue to represent losses of five or even six figures for those who bought them years ago and still could not sell for a profit or even a break even.
Instead of waiting on home sales statistics to make some people believe the real estate market has rebounded, your time should be spent on checking local business news.
Here is another example, this time from Austin Texas. It seems a local investor partnership has just purchased the Vista Lago Apartments, located in the Lady Bird Lake area. This partnership immediately announced plans to renovate and then re-open the property, which currently contains 102 units.
I'm sure you are wanting to ask me what this information has to do with the local home sale market in Austin, or anywhere else for that matter. And I'm here to tell you it COULD have a lot to do with it.
Since most of you do not live or work in this area, here is why this answer could relate to your situation, whether you are a property owner or a real estate professional.
For the near future, the renovation of a 100+ unit apartment building will mean a lot of construction and contractor projects and jobs. In some cases, people prefer to move close to where jobs are or will be in order to save on commuting and be available as needed.
Upon completion of the renovation, this partnership will either sell the "new" building and get out or they will look to rent or sell the "new" units themselves. Either way, the owner of Vista Lago will be advertising for new residents for this area, and most likely at market value or higher for rentals in this "new" building.
If I was a home owner in that area, I would immediately spring into action. I would do my homework and research what apartment rents currently are for that area, especially the more upscale apartments or units. Once I come up with a number, I would compare it with my current mortgage and monthly costs. Next, compare that number with what your home has to offer, and see if or how it compares to what a new rental unit would fetch.
Keep in mind it might not be a direct comparison. (I'm making up these numbers for the sake of example, so please don't quote me.) Suppose you would expect a 2-bedroom unit to rent for $950 per month, but your 3-bedroom home with a garage and a private pool costs you $1,100 per month on your mortgage and other costs. I would contend you have something to offer.
Using that comparison, you could offer a "rent to buy" of your home, and be able to promote how "for only $150 per month additional, you get an additional full bedroom, additional enclosed parking, and your own pool to use when you want". Add in the "And you won't hear neighbors through the walls, be awakened by upstairs neighbors' footsteps......." and other selling points.
If I was a realty agent in that same area, I'd be doing this comparison with homes currently on the market (in an effort to attract buyers for buyer commissions) as well as for past clients who live in the area and might want to jump on such an opportunity.
There has to have been enough potential for that immediate area to attract an investment partnership into renovating a 102 unit building in order to profit from it. The sooner you can pounce on that potential, especially before the Vista Lago opportunity becomes available, the more chances you have to generate sales because of it.
You could have "rent to buy" options, which Vista Lago may not even be offering. You could have outright sale opportunities, perhaps being able to offer a potential renter the opportunity to buy for the same general amount.
Even if you don't live in Austin or in this area, the idea is there for you. The Vista Lago complex is certainly not the only large apartment complex to be purchased for renovation. The concept is to track down upcoming residential construction and renovation and see what you can provide to potential buyers or renters in comparison.
That would be far more productive than waiting for home sales statistics to inch your way.
Places in Time III
4 days ago