real estate investing

Forward this e-mail to your friends!  Then they can subscribe directly at the following link:  http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

******************************************************

“Lazy Person’s Way to Pre-Foreclosure Riches”

Since putting this system to work instead of me, I’m

slaving away at the beach with sun screen on my arms,

and my cell phone at my ear for a full, uh, 20 hours

a week.

Life’s not so tough when others willingly do your work.

And the earnings?  Out of this world!  See how I do it

anywhere I want from my iPhone… and it won’t cost you

a cent Tuesday at 3 PM ET, NOON PST:

https://www2.gotomeeting.com/register/241411282

*****************************************************

Now on to our real estate investing educational section…

Home supply rises 4.2%

According to data compiled by ZipRealty, inventory of homes — single-family homes, condominiums and town houses listed on local multiple-listing services — in 27 major metropolitan areas rose 4.2% in February from a month earlier. The inventory in February dropped 19% year-over-year. The figures compiled by ZipRealty may not present the exact level of supply since half of foreclosed homes are not included on multiple-listing services at any given time on account of such homes awaiting repairs or being subject to litigation. Ivy Zelman, chief executive of Zelman & Associates, a research firm, says the average increase in home inventory in February has been 3.4%, over the past 27 years. Analysts say the housing inventory could be much higher than what is reported, and a large supply of unsold homes could hit market recovery. David Moon, president of Moon Capital Management, says the housing inventory data does not account for “properties on which the loans are seriously delinquent and those that already are in the foreclosure process but not for sale. Banks often have houses in their real estate owned portfolios that aren’t yet on the market.” 

Will foreign investment help commercial real estate?

“A wave of commercial real estate loan failures could threaten America’s already-weakened financial system … and… trigger economic damage that could touch the lives of nearly every American,” according to a recent Congressional Oversight Panel report. As troubled loans running into billions of dollars come due in the next few years, the industry is facing the prospect of a huge wave of defaults. A recently proposed legislation seeks to attract foreign investment to the commercial real estate sector to provide the much needed liquidity for the sector. In January, Joseph Crowley, a Democratic congressman, introduced the Real Estate Revitalization Act of 2010 which seeks to eliminate certain taxes that were part of the Foreign Investment Real Estate Property Tax of 1980 (FIRPTA). FIRPTA requires foreign investors to pay as high as a 55% tax on capital gains from the sale of U.S. real estate or shares in real estate investment trusts. Supporters of the bill say that by repealing the tax, the country would attract significant foreign investment. “We’re talking about bringing in foreign investment to be on equal footing if they invest in real estate versus non real estate,” says Jeffrey DeBoer, chief executive of the Real Estate Roundtable, a real estate think tank. Many property owners are now facing debt calls on account of property prices having fallen about 40% from their peak, and the commercial mortgage-backed securities market has dried up. Real estate loans to the extent of $1.4 trillion will come due between 2010 and 2014, and about 50% of those loans are currently “underwater.” If the bill is passed, Real Estate Investment Trusts could benefit significantly.

Bair says consumers did not understand subprime mortgages

Sheila Bair, the chairman of the Federal Deposit Insurance Corp. (FDIC) has said there is “ample evidence that consumers did not understand the consequences of the subprime and nontraditional mortgages that were sold to them.” In a speech to the National Association of Business Economics, Bair has called for greater consumer protection in financial services and said the information flow among the different market participants should significantly improve. “Economists understand a great deal about the effects of asymmetric information, and how it can prevent markets from existing in the first place or from operating efficiently,” Bair said. “In this light, I think there is a strong case to be made that basic consumer protections help markets function better by reducing information gaps between lenders and borrowers.” Commenting on failures of large financial firms, Bair said the typical resolution should not be a bailout using public money, but should be a mechanism which would ensure that shareholders and creditors take the losses.

 Small business optimism slips

According to a survey conducted by the National Federation of Independent Business (NFIB), its index measuring sentiment among small business owners dropped 1.3 points to a reading of 88.0 in February, from January. Incidentally, a value of 90 in the index indicates an expectation of positive growth. The index has remained at 90 for 17 straight months, and below 90 in all but 4 months since January 2008. The survey said small business owners cited weak sales as their biggest concern. The poor outlook on demand is driving small business owners to liquidate inventories and go slow on ordering new stocks. “Something is preventing owners from ‘pulling the trigger,’ said William Dunkelberg, chief economist for NFIB.”Very few owners felt that growth opportunities were solid enough to warrant expansion.” Only about 9% of the respondents said they were hampered by lack of credit. “Credit access is not a major factor holding up economic growth, at least the kind of growth we want,” said Dunkelberg.

Hiring outlook worsens

According to a quarterly survey by Manpower, a consultancy, employers in the U.S. are less willing to hire workers in the coming 3 months than they were 3 months ago. Some 17 million Americans are currently unemployed and the survey results do not indicate any optimism on employment. The survey is based on interviews with 18,000 managers responsible for hiring workers and measures the difference between those who say they will add to their workforce and those who plan cuts. About 73% reported no change in their hiring outlook, matching last quarter’s record. “There is some demand, so (employers) won’t let people go, but not enough confidence to do hiring,” Manpower Chief Executive Jeff Joerres said. According to Joerres, the U.S. economy is caught in a vicious cycle – companies will not add capacity and hire workers until demand improves, while consumers will not buy until unemployment falls and incomes improve. Joerres argued for continued government stimulus until the economic situation improves. “A snail’s pace recovery is (equivalent to) falling back,” Joerres said. “A very slow recovery is dangerous.”

 See you at the top!

 Chris McLaughlin
**************

Copyright Loss Mitigation Institute LLC 2009.

All Rights Reserved.

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches 

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
us and our market…
http://www.shortsalesriches.com/blog

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month
   * Long-time authority on real estate investing
      and rapid reselling of distressed homes.  Owns
      portfolio of nearly 100 high-value, high-profit
     properties
    * Owner of one of Florida’s largest Real Estate firms,
     running 4 different offices, supporting over
     400 agents, uniquely positioning him to help
     thousands of investors make money in the
     biggest market opportunity ever!
    * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building
    * Follow me on Twitter: http://twitter.com/mclaughlinchris
    * Join my Facebook Fan Page: http://www.mclaughlinchris.com
–

Forward this e-mail to your friends!  Then they can subscribe directly at the following link:  http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

******************************************************

The FINAL Short Sale Sensei webinar:

She was one of them.  She attended their office parties.

She’s sat down to dinner beside them.  Socialized and went

to sporting events with them.

 

If there’s a tactic or strategy the bank’s kept hidden from

investors, she knows it.  She’s the Short Sale Sensei. 

 

And she’s ready to spill the beans in a FINAL ENCORE this coming

Saturday, at 3 PM ET, NOON PST, on a fr-ee webinar, right here:

https://www1.gotomeeting.com/register/261917249

******************************************************

Pending home sales drop 7.6%

According to the National Association of Realtors (NAR), its Pending Home Sales Index, a forward-looking indicator based on contracts signed in January, dropped 7.6% to 90.4 from a reading of 97.8 in December, and is 12.3% higher than January 2009 when it was 80.5. NAR said the harsh winter hampered home sales. “January pending sales, though still higher than one year ago, remain much lower than expected given that a large number of potential buyers are eligible for the expanded home buyer tax credit,” said NAR chief economist Lawrence Yun. “Moreover, the abnormally severe and prolonged winter weather, which affected large regions of the US, hampered shopping activity in February.” Analysts say extension of tax credit is doing little to boost pending home sales, and given that the Federal Reserve will end purchase of mortgage backed securities this month, the housing recovery is going to take time. “When you take away all the support from the housing market, the underlying demand for housing is a lot weaker than we thought,” said Mark Vitner, an economist at Wells Fargo Securities. “We clearly pushed some demand forward, and there wasn’t that much demand to pull forward anyway. The housing recovery is going to be very, very slow.” On a regional basis, the pending home sales index dropped 8.7% to 71.3 in the Northeast, dropped 13.2% to 102.9 in the West, dropped 8.9% to 81.2 in the Midwest, and dropped 2.1% to 98.1 in the South.

Construction of multifamily units to rise in 2010

Green Street Advisors, a research firm, says real estate investment trusts are likely to begin construction of multifamily units worth about $1 billion in 2010; this is a significant increase over the $100 million of development starts in 2009. This comes as a bit of surprise since apartment vacancy is at a record high and the unemployment rate is not expected to come down any time soon. Analysts point out that construction cycles of multifamily units run into a few years and companies have to start today and be ready when the market turns around. Companies are betting that limited supply of new units coupled with an improving economy will help the sector in another couple of years. After 2012 until 2015, “apartment REITs may generate the best property net operating income growth that they’ve seen in a very long time, maybe ever,” said Haendel St. Juste, a REIT analyst with Keefe, Bruyette & Woods. While the sector has significant risks, analysts believe things are getting better. “There’s an element of risk,” said Andrew McCulloch, an analyst with Green Street. “But if you were to go back a year, the outlook is much more clear today. Their confidence level in that eventual recovery is much higher.”

Analysts predict better times for commercial mortgage

The commercial mortgage market, which hit the lowest level last year since 2003, is likely to do better in 2010. Analytics firm Trepp, which monitors collateral performance on related commercial mortgage backed securities (CMBS), says the amount of commercial loans at least 30-days delinquent rose to 6.72% in February; this is the smallest increase in six months. In addition, the value of commercial real estate loans that collateralize CMBS increased to 76.7% of the original loan price through January 2010, up from 75.9% in December, according to Debtx, a research firm. Cushman & Wakefield, a commercial real estate (CRE) services provider, has predicted a 30% increase in global CRE investments in 2010. Analysts believe mortgages are the best option now for both high yields and safety, and will attract the attention of investors in 2010. David Hutchings, head of research at Cushman & Wakefield says investors aren’t shying away from the risk in CMBS. “While challenges clearly remain and a double-dip cannot be ruled out, a higher risk appetite among financiers and investors will continue to fire the market,” Hutchings said.

Factory orders rise 1.7%

According to the Commerce Department, new orders for goods manufactured in U.S. factories rose 1.7% in January; this is the ninth rise in the last 10 months. Orders for nondurable goods, including food, paper products, petroleum and coal products, rose by 0.9% in January while orders for durable goods such as computers, cars and machinery, rose by 2.6% in January. Manufacturers have been battered by the financial crisis and the recession hit demand for durable goods in the last couple of years. Orders for heavy machinery fell 9.2% in January after posting a 7.3% increase in December. “The culprit here is turbines,” said Michael Feroli, an economist at JPMorgan Chase. “You smooth it out and things weren’t as robust as they seemed in December, but maybe not as dire as they seemed in January.” The decline in orders for heavy machinery has not dampened economists’ outlook. The declines in orders of heavy equipment “don’t change our opinion that capital spending is recovering,” said Aaron Smith, an economist at Moody’s Economy.com. “There’s always a tendency for the turbines and generator category to be weak in the first month of the quarter and stronger in the last month and that trend is particularly strong for the first part of the year.”

Payrolls fall less than expected in February

The jobless rate remained unchanged at 9.7% in February compared to January. The Labor Department said employers cut 36,000 jobs in February; analysts had expected at least 50,000 jobs to be cut in February. On a sectoral basis, professional and business services added 24,000 jobs in February; manufacturers added 1,000, construction companies eliminated 64,000 jobs, financial sector cut 10,000, and the government cut 18,000 jobs. The Labor Department said it is difficult to measure the impact of winter storms on employment. “Nor do we know how new hiring or separations were affected by the weather. For those reasons, we cannot say how much February’s payroll employment was affected by the severe weather,” said Bureau of Labor Statistics Commissioner Keith Hall. Economists say the less than expected job cuts are an indicator that unemployment is easing. “We are almost there, the point where we are consistently adding jobs,” said Ken Mayland, president of ClearView Economics. “The economy is making incremental but broad-based gains towards improvement.” Since the start of recession, 8.36 million jobs have been lost and unemployment remains the single biggest challenge for President Obama.

Now on to our real estate investing educational section…

Friday File – 15 Minute Resolution

Today’s 15 minute resolution is to learn the basics about using Twitter.  Think you don’t need to set up a Twitter account? Better think again. Despite the somewhat frivolous sounding name, Tweeting is becoming big business as heavy-weight real estate investors like Guy Kawasaki and even the Donald (as in Trump) sign-on.

A few of the most frequently cited reasons for joining Twitter include:

1. Sell products or services…sounds like a good reason for real estate investors to join right there!

2. Stay in immediate contact with a large number of people…ditto!

3. Monitor your reputation in real time. Find out what people are saying and take steps to enhance your professional reputation along the way.

4. SEARCH – Learn to use this powerful tool as soon as possible. Visit http://search.twitter.com/ 

5. ADVANCED TWITTER SEARCH – Serious tools for serious investors. Localize your search by area, specific people, places or other criteria…real time information.

6. Obtain data on your own Tweets with the use of social media analytics like www.objectivemarketer.com.

So, now that you know just a few of the reasons why Twitter is so important, it’s time to put your 15 minute resolution into effect. This week take time to create a Twitter account if you don’t have one (it’s simple…just visit www.twitter.com) or pimp out your Twitter page if you are still making do with a plain vanilla template.

1. Visit www.twitterbackgroundsgallery.com to find an easy to use Twitter template or create your own. Be sure to make your contact information highly visible but keep it simple, clean and concise.

2. Use the url field! Seriously folks, a blue background is bad enough but make the most of all the marketing potential by populating the existing fields.

3. Have it done for you. Not a designer by nature? No need to worry…it’s easy to have a complete Twitter account fully set-up and waiting for you.

See you at the top!

Chris McLaughlin
**************

Copyright Loss Mitigation Institute LLC 2009.

All Rights Reserved.

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches 

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
us and our market…
http://www.shortsalesriches.com/blog

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month
   * Long-time authority on real estate investing
      and rapid reselling of distressed homes.  Owns
      portfolio of nearly 100 high-value, high-profit
     properties
    * Owner of one of Florida’s largest Real Estate firms,
     running 4 different offices, supporting over
     400 agents, uniquely positioning him to help
     thousands of investors make money in the
     biggest market opportunity ever!
    * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building
    * Follow me on Twitter: http://twitter.com/mclaughlinchris
    * Join my Facebook Fan Page: http://www.mclaughlinchris.com
–

Forward this e-mail to your friends!  Then they can subscribe directly at the following link:  http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

******************************************************

We’re not allowed to release her name. Because she used to

work for the enemy.  And she knows all their dirty little

tricks.  Just call her the Short Sale Sensei…

 

This gal used to be well respected by banks.  She processed

nearly 10,000 short sales for lenders too big to name here.

 

She was one of them.  She attended their office parties.

She’s sat down to dinner beside them.  Socialized and went

to sporting events with them.

 

If there’s a tactic or strategy the bank’s kept hidden from

investors, she knows it.

 

And she’s ready to spill the beans in an ENCORE TODAY,

Thursday, at 3 PM ET, NOON PST, on a fr-ee webinar, right here:

 

https://www1.gotomeeting.com/register/815788648

******************************************************

Mortgage applications rise as interest rates fall

According to the Mortgage Bankers Association (MBA), its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, rose 14.6% for the week ended February 26, from the earlier week. The Refinance Index rose 17.2% from the previous week while the seasonally adjusted Purchase Index increased 9.0% from one week earlier. The increase was due to a drop in loan rates — the rate on 30-year fixed-rate mortgages dropped to 4.95%. “Mortgage applications rebounded last week, particularly refis, as rates dropped back below 5 percent,” said Michael Fratantoni, vice president of research and economics at MBA. “Purchase activity remains subdued, with application volumes remaining within the narrow range seen in the last few months.” Analysts say the surge in mortgage applications is not an indication of long-term recovery, given the current levels of foreclosure and unemployment. “We are seeing positive signs of some form of life, but it is not significant and the recuperation period is going to be significant because these are dramatic declines” in housing, said Vickie Lester, president of mortgage servicing at RoundPoint Financial Group.

Home prices rise 5%

Clear Capital, a provider of real estate data, says home prices climbed 5% nationally in February from a year ago. The prices grew 2.3% in January on an annual basis. Among metropolitan areas, Providence, Rhode Island saw the highest rise of 6.1% from the earlier quarter. California had 5 of the 15 highest performing markets. The rise in prices is likely to be sustained as the tax credit deadline approaches in April. “If the increase in demand that preceded the end of the last tax credit is any indication, home prices may dip only slightly into negative territory before getting an added boost before the April tax credit deadline,” said Alex Villacorta, senior statistician at Clear Capital. The firm has expressed optimism despite the likely impact of REOs – properties that go back to the mortgage company after an unsuccessful foreclosure auction – on home prices in the coming months. “Although many markets have seen a slow down in price gains, I’m encouraged that prices have remained positive through the first two months of the year despite all the negative economic news and threat of more REOs hitting the markets,” Villacorta said.

Hovnanian returns to profitability

Hovnanian Enterprises, a real estate development company, posted a profit of $236.2 million for the quarter ended January 31, compared with a year-earlier loss of $178.4 million. The result includes a $5 million write-down on land and other items, compared with $132 million in write-downs a year earlier. This is the first quarterly profit since 2006. Hovnanian operates in 18 states, including California, Arizona and Florida, the worst-hit states. The company’s net contracts, excluding unconsolidated joint ventures, decreased 5% while the average price grew 14%.

The company’s contract backlog as of January 31 was 1,593 homes, down 4%, with a value of $505.4 million. The cancellation rate dropped to 21% from 31%; this was the company’s lowest cancellation rate since the second quarter of 2005. Ara Hovnanian, Chief Executive of Hovnanian, sounded cautiously optimistic about the company’s prospects for the near-term. “We are pleased to see the market for new land deals begin to thaw out a bit and we continue to diligently pursue new land opportunities where we can make normalized returns based on today’s home prices and sales absorption levels,” said Hovnanian. “I’m not trying to brush off concerns in the marketplace. There are risks, and the risks are real.”

Service sector’s best performance since December 2007

The Institute for Supply Management (ISM) said its index tracking the service sector rose to 53.0 in February from a reading of 50.5 in January. This is above the estimate of 51.0 made by economists. A reading above 50 indicates economic expansion while a reading below 50 denotes contraction. The February reading is the highest since December 2007. The services sector accounts for about 70% of America’s economic activity. “We’re starting to see a broadening of the economic recovery,” said Richard DeKaser, chief economist at Woodley Park Research. The data “are encouraging, to say the least.” Dean Maki, chief U.S. economist at Barclays Capital, said: “Spending by consumers and businesses is growing again, though not at the pace prior to the financial crisis. Generating service-sector employment is quite critical to the broader economy.” Unemployment is the biggest concern. Given the current unemployment level, it may take years and not months for the sector to recover in a sustained manner. “Business feels better, there is no question about it,” said Macy’s Chairman and Chief Executive Officer Terry J. Lundgren. “We still have high unemployment, and I still see tight credit on consumers.” Nine industries, including information technology, arts, transportation and retailing, saw growth in February while 8 industries saw a fall in output.

Planned layoffs drop in February

According to a report released by Challenger, Gray & Christmas, a consultancy, planned job cuts announced by U.S. employers dropped 41% to 42,090 in February, from the 71,482 layoffs recorded in the previous month; this presents a 77% drop from 186,350, a year earlier. The report states that job-cut total in February is the smallest since July 2006. Analysts believe it will take some time before hiring starts to grow. John A. Challenger, chief executive officer of Challenger, Gray & Christmas, said: “Employers have shifted away from downsizing and are poised to start adding workers. It may be a couple of more months before hiring begins to surge.” Pharmaceutical companies, with 17,687 announced cuts, and government and non-profit agencies, with 4,628, led all industries in reductions in February. The economy is limping back from its worst downturn since the 1930s, but economists are concerned about the unemployment rate which is expected to average close to 10% this year.

Now on to our real estate investing educational section…

Whole Life Financing For Dummies

Have you been sitting on the sidelines waiting to accumulate cash to start investing in short sales? There are faster, easier and more efficient ways to raise needed funds but one that is gaining a great deal of support is the use of whole life insurance as a finance vehicle for short sale investing.

Whole life insurance is often considered a “bad buy” among traditional investment guru’s including notables such as Dave Ramsey and Suzy Ormon…indeed, for the average American struggling just to get by, any form of life insurance is often viewed as a luxury rather than necessity. However, those with the foresight plus a little time on their hands to crunch the numbers soon realize a whole life policy isn’t always a bad investment…in fact, held long-term it can be the most economically viable option. Beyond the basic death benefit, there are other very real rewards to be gained from a whole life policy including the use of low-cost financing.

Basically it works like this; once a participating whole life policy is purchased and capitalized or funded, the dividends eventually cover the cost of the policy itself. Additional paid in full riders can greatly increase the initial funding of the account to grow the cash balance to a desirable level. At this point, the policy can be borrowed against for any desired purpose…including the purchase of real estate. A contract is established that delineates the “interest rate” to be charged on the loan and the time period in which it is to be repaid.  Meanwhile, the policy continues to receive dividends based upon the complete cash value of the policy essentially creating an exceptionally low cost source of funds. In fact, the policy owner benefits in several ways since the payments (with interest) are paid directly back into the whole life account. Interest can be used as a write-off for the real estate expenses while simultaneously, excess payment amounts paid back into the whole life policy are used to purchase additional paid-in-full premiums thereby increasing the death benefit and available source of future cash value in the account.

Not only does the account continue to grow, pay dividends and collect the full payments back into the account but insurance is considered a protected asset in many states and taxes are deferred until the withdrawals exceed the amount paid into the policy. Because dividends are considered a ‘return of premium’ rather than distribution of profits, they are not subject to typical taxes.

If you own a whole life insurance policy, take time to carefully consider the feasibility of using a policy or cash value loan to dramatically enhance your individual real estate portfolio. By establishing favorable repayment terms and recapturing the interest rates into your own account, it’s possible to act like your own banker while building a strong real estate investment portfolio.

See you at the top!

Chris McLaughlin
**************

Copyright Loss Mitigation Institute LLC 2009.

All Rights Reserved.

http://www.shortsalesriches.com
http://www.shortsalescoach.com
http://www.sixfigurebpo.com
http://www.reomillionaireclub.com
http://www.youtube.com/shortsalesriches 

http://www.smartrealestatenews.com (subscribe to this newsletter)

*************************************************
Finally, a blog for Real Estate professionals
that want up-to-the-minute news, & how it impacts
us and our market…
http://www.shortsalesriches.com/blog

*************************************************

About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month
   * Long-time authority on real estate investing
      and rapid reselling of distressed homes.  Owns
      portfolio of nearly 100 high-value, high-profit
     properties
    * Owner of one of Florida’s largest Real Estate firms,
     running 4 different offices, supporting over
     400 agents, uniquely positioning him to help
     thousands of investors make money in the
     biggest market opportunity ever!
    * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building
    * Follow me on Twitter: http://twitter.com/mclaughlinchris
    * Join my Facebook Fan Page: http://www.mclaughlinchris.com

Forward this e-mail to your friends!  Then they can subscribe directly at the following link:  http://www.smartrealestatenews.com/

*** Follow Chris on Twitter–> http://www.twitter.com/mclaughlinchris

*** Join Chris’ Facebook Fan Page–> http://www.mclaughlinchris.com

******************************************************

We’re not allowed to release her name. Because she used to

work for the enemy.  And she knows all their dirty little

tricks.  Just call her the Short Sale Sensei…

 

This gal used to be well respected by banks.  She processed

nearly 10,000 short sales for lenders too big to name here.

 

She was one of them.  She attended their office parties.

She’s sat down to dinner beside them.  Socialized and went

to sporting events with them.

 

If there’s a tactic or strategy the bank’s kept hidden from

investors, she knows it.

 

And she’s ready to spill the beans in an ENCORE tomorrow,

Thursday, at 3 PM ET, NOON PST, on a fr-ee webinar, right here:

 

https://www1.gotomeeting.com/register/815788648

******************************************************

Number of bank failures this year: 22 and counting

Last week, regulators closed 2 banks, bringing the number of bank failures to 22 so far this year. The banks which were shut down are Carson River Community Bank, based in Nevada, with $51.1 million in assets and $50 million in deposits as of Dec. 31 and Rainier Pacific Bank with $717.8 million in assets and $446.2 million in deposits as of Dec. 31. The Federal Deposit Insurance Corporation (FDIC), which insures up to $250,000 per account at member institutions, will take a hit of over $100 million on account of the 2 failures. FDIC says the number of troubled banks jumped to 702 in the fourth quarter from 552 in the earlier quarter. Nearly one in every three banks reported a loss in the latest quarter. Amid recession and a rise in delinquent loans, the pace of bank failures has been rising, from 25 in 2008, to 140 in 2009, and to 22 in just the first 2 months this year. Banks are likely to incur as much as $300 billion in losses on Commercial property loans in the near-term, according to a recent report by the Congressional Oversight Panel, the watchdog that monitors financial bailout. With the economy not showing any signs of sustained recovery, the FDIC’s insurance fund is expected to take a hit of over $100 billion in the next four years.

Construction spending falls 0.6%

According to the Commerce Department, construction spending in the U.S. fell for a third straight month by 0.6% to $884.13 billion in January; construction spending dropped 1.2% in December. Nonresidential buildings in the private sector dropped 0.9% in January, while state and local government construction dropped 0.7%. Federal construction spending rose 1.9% to a high of $30.68 billion in January, increasing for the fifth straight month. Spending on private home buildings rose 1.3%. While housing starts rose 2.8% in January from December, construction permits, an indicator of future projects, dropped 4.9%. New home construction which rebounded strongly in the third quarter of 2009 seems to have lost some momentum. The economy was pushed into its worst slump since 1930s on account of the housing collapse. “We haven’t really seen much improvement in housing,” said Michael Englund, chief economist at Action Economics. “Residential construction is still weak. On the non-residential side, builders are hesitant to go along on new projects and banks are reluctant to provide the capital.”

Will Simon’s bid for General Growth attract antitrust?

Simon Property Group, a large owner of malls presented last month a $10 billion offer to buy General Growth Properties, another mall operator. Simon has offered to pay $7 billion towards General Growth’s unsecured debt. In addition, Simon would pay $6 per share to General Growth’s shareholders and spin off General Growth’s residential-development division, which Simon values at $3 per share. The deal, if it goes through, would create a single entity which would control about 520 malls in the U.S. While analysts wonder if the bid would invite antitrust concerns, David Simon, the Chief Executive Officer of Simon, said such concerns are unwarranted. “No way. Not even close,” said Simon. “Retail real estate is so diverse. There are so many options for retailers. We’re competing with the Internet. You have Wal-Mart [Stores Inc.], big-box retailers, department stores. I just don’t see it being a big issue. But there’s an education process I think the industry is going to have to go through.” General Growth is not interested in accepting Simon’s bid and has countered Simon’s bid with a plan to receive funding from Brookfield Asset Management Inc., a Canadian property investor.

HARP gets extension for 12 months

The Obama administration introduced the Home Affordable Refinance Program (HARP) last year to help about 4 to 5 million borrowers who have little or no equity in their homes. The program, administered by Fannie Mae and Freddie Mac, refinanced 190,180 mortgages in 2009 with loan-to-value between 80% and 125%. The program which was set to expire June this year has been extended by 12 months. Edward DeMarco, acting director of the Federal Housing Finance Agency, said the program has been extended to June 2011 in order to “support and promote market stability and to encourage lenders and other mortgage market participants to fully adopt the HARP program, including the implementation of the October 2009 expansion of loan-to-value ratios to 125%.” Analysts have been critical of the program and say it has had a limited impact so far. “The overall volume last year was an embarrassingly small amount. I don’t think it will make a big difference” to have the program extended, said Thomas Lawler, a housing consultant.

Bankruptcies drop in the U.S.

BankruptcyData.com says only 5 public companies filed for Chapter 11 or Chapter 7 bankruptcy protection in February, compared to 19 in the same period in 2009. In January, 12 public companies filed for bankruptcy while 11 public companies went under in December. Bankruptcies of large companies — with more than $1 billion in assets — have slowed down. In 2009 about 25% of the companies that filed for bankruptcy had assets over $1 billion while so far this year only 19% percent of the total 16 bankruptcy filings have had more than $1 billion in assets. The improved economic situation and buoyancy in capital markets are helping companies stay afloat. Analysts however warn that the scenario is not entirely rosy and more bankruptcies can be expected. “Last year was like a tsunami, but this next phase will be more like a rising tide; consistent and steady,” said William Snyder, a managing partner with CRG Partners. Analysts feel capital restructuring can help companies only to a limited extent. In the long run, what really matters is operational efficiency. Alan Cohen, chairman of Abacus Advisors, a turnaround and restructuring firm, said: “You can correct a balance sheet by manipulating debt into equity, or reducing debt, but unless the entity focuses on improving operations, they’re going to have a tough time.”

Now on to our real estate investing educational section…

Parkinson’s Law & Short Sales

Cyril Parkinson must have been an astute student of human behavior especially when it came to economic trends and traits; a British Civil service employee, Parkinson originally noted the tendency for bureaucracies to expand over time…an observation sure to be noticed by short sale buyers waiting for approval from big banks. In fact, many of the Parkinson’s observations seem to apply especially well to short sale investments including:

“The demand upon a resource tends to expand to match the supply of the resource”

Think about “easy credit”. Without easy credit and lax lending terms many people would not have bought homes they were unable to afford to begin with; it’s also why modification programs simply won’t work in the majority of situations. Despite decades of government intervention designed to make everyone a homeowner, the ratio of renters versus homeowners tends to remain the same over time. Essentially the current situation can be considered a correction back to the “mean”.

“The amount of time in which one has to perform a task, is the amount of time it will take to complete that said task”

Again, how many last minute approvals have you encountered recently? While procrastination isn’t limited to bankers or brokers, it’s certainly alive and well in today’s economic arena.

So, how can you use Parkinson’s Law to your advantage? It’s simple…

1. Expedite Deadlines…for yourself and others. Rather than wait until the last possible moment, start setting deadlines ahead of time for both yourself and others. This not only reduces stress but tends to put you back in control of sluggish situations and lagging negotiations.

2. Put a “product” back into productivity…rather than outline a “to-do” list, start measuring actual outcomes instead. For example, set a date to have all your social media marketing up and running then clearly define what it should consist of and look like. If you aren’t able to get it done by a specified date, pull in the big guns and have it done for you; remember, the objective is to  achieve a final outcome or goal rather than just “make busy work”.

3. Calculate the value of your time…then hire out others to do at least the bottom 20% of the least profitable errands and chores. By consistently doing this on a regular basis it is possible to increase your personal productivity and hourly time value by well over 20 per annum.

See you at the top!

Chris McLaughlin
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Copyright Loss Mitigation Institute LLC 2009.

All Rights Reserved.

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About the author:

Chris McLaughlin is widely known as America’s top
Real Estate Attorney and Investment Consultant.

    * As the top Florida foreclosure and pre-
      foreclosure expert, he oversees more than
      100 short sale & REO closings each month
   * Long-time authority on real estate investing
      and rapid reselling of distressed homes.  Owns
      portfolio of nearly 100 high-value, high-profit
     properties
    * Owner of one of Florida’s largest Real Estate firms,
     running 4 different offices, supporting over
     400 agents, uniquely positioning him to help
     thousands of investors make money in the
     biggest market opportunity ever!
    * Highly sought-after speaker, consultant, and
      seminar leader for current trends and hot topics
      in Real Estate Investing, Entrepreneurship, and
      Wealth Building
    * Follow me on Twitter: http://twitter.com/mclaughlinchris
    * Join my Facebook Fan Page: http://www.mclaughlinchris.com
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