Dealing with California foreclosures by sticking with California's real estate market in the face of, until recently, increasing foreclosure rates will take a very strong investor who comes to the game with strong financial backing and a lot of patience. It wasn't always the case that an investor needed to be this way out in California, because (prior to the real estate bust) any people played the game with little or no financial backing to speak of.
Why this is so has mainly to do with a string of unrealistic expectations and a fair amount of irrational exuberance, especially out in California real estate markets. Many people basically looked at home buying as an investment instrument rather than an actual home and got into the buying and selling of real estate with little capital and with ridiculously lax lending backing them up.
This sort of phenomenon -- which many real estate industry experts refer to as flipping -- went on with surprising vigor out in the Golden State, to name just one region. Of course, no housing boom has ever lasted forever without being accompanied by a subsequent housing bust. The current rate of California foreclosures is prime evidence of this axiom, though many didn't really believe it would ever happen.
Now, with nationwide foreclosure numbers at well over 300,000 in a month -- and with California along with several other states contribute in nearly 60% to that number -- many weak investors, and more than a few home owners, have been forced out of the market. In most cases this was involuntarily, which is another explanation for why CA foreclosures have become a common sight in the Golden State.
Whether or not any investor has the fortitude to stick with California real estate depends on that investor's tolerance for risk, for one. Patience and tolerance or not characteristics that many investors in the old California real estate market possessed in large degree. But, long-term prospects for an eventual rebound look strong, meaning the patient investor could make something of even the California market over time.
It doesn't look as if short-term prospects, at least at present, are going to improve for the next few years even out in California, which has some of the most desirable properties in the country. Just a few years back, an investor in property in California could make a 30% profit in a single year, which is exceptional but which is also clearly unsustainable over the long run.
Today? Any investor hoping to get into the market at its bottom and take advantage of all those CA foreclosures with the realistic in expecting, at most, a 3% rate of return over 36 months, though that promises to improve as California gets control of its housing markets and its budgetary problems. Though that rate is an average or generalized figure, it's still probably reliable over the short-term.
Some experts feel that this deep correction was necessary for California on at least a macro scale. The rate of California foreclosures has made investors realize that there are times when they "buy and hold" strategy makes more sense than a flipper-like strategy, which can be after mental to any real estate market. Investors in California properties, therefore, should go into it with good finances and equally good amounts of patience. - 31862
Why this is so has mainly to do with a string of unrealistic expectations and a fair amount of irrational exuberance, especially out in California real estate markets. Many people basically looked at home buying as an investment instrument rather than an actual home and got into the buying and selling of real estate with little capital and with ridiculously lax lending backing them up.
This sort of phenomenon -- which many real estate industry experts refer to as flipping -- went on with surprising vigor out in the Golden State, to name just one region. Of course, no housing boom has ever lasted forever without being accompanied by a subsequent housing bust. The current rate of California foreclosures is prime evidence of this axiom, though many didn't really believe it would ever happen.
Now, with nationwide foreclosure numbers at well over 300,000 in a month -- and with California along with several other states contribute in nearly 60% to that number -- many weak investors, and more than a few home owners, have been forced out of the market. In most cases this was involuntarily, which is another explanation for why CA foreclosures have become a common sight in the Golden State.
Whether or not any investor has the fortitude to stick with California real estate depends on that investor's tolerance for risk, for one. Patience and tolerance or not characteristics that many investors in the old California real estate market possessed in large degree. But, long-term prospects for an eventual rebound look strong, meaning the patient investor could make something of even the California market over time.
It doesn't look as if short-term prospects, at least at present, are going to improve for the next few years even out in California, which has some of the most desirable properties in the country. Just a few years back, an investor in property in California could make a 30% profit in a single year, which is exceptional but which is also clearly unsustainable over the long run.
Today? Any investor hoping to get into the market at its bottom and take advantage of all those CA foreclosures with the realistic in expecting, at most, a 3% rate of return over 36 months, though that promises to improve as California gets control of its housing markets and its budgetary problems. Though that rate is an average or generalized figure, it's still probably reliable over the short-term.
Some experts feel that this deep correction was necessary for California on at least a macro scale. The rate of California foreclosures has made investors realize that there are times when they "buy and hold" strategy makes more sense than a flipper-like strategy, which can be after mental to any real estate market. Investors in California properties, therefore, should go into it with good finances and equally good amounts of patience. - 31862
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Dealing with CA foreclosures by staying in California real estate, even though foreclosures have increased immensely over the last 18 months, will require an investor to have a strong financial portfolio. We've got the ultimate inside information on ca foreclosure properties.
