Congratulations, real estate investors! You’re having a noticably positive impact on the housing recovery and are even being acknowledged in the press. According to the San Francisco Chronicle, the Bay Area local market is seeing bidding wars and multiple offers with ever increasing frequency. What’s the cause?
An analysis by MDA DataQuick suggests the change in fortunes is due largely to the flipping of short sale properties by real estate investors like you!
Furthermore, investors have been increasing their participation in public foreclosure auctions and thus helping to keep REO inventories below catastrophic levels.
***BUT*** the good folks at the San Francisco Chronicle – who have consistently demonstrated themselves to be quite clueless about the way business and the economy really work – suggest that this activity by real estate investors is a BAD thing. Why? A quiet form of class envy: According to this writer, short sale investors are shutting out first-time real estate buyers.
Buyers like Luis Jiminez (who pooled money with family members to buy a rehab as a short sale and then sold it after evaluating eight prospective offers) and all other real estate investors like Jiminez or, “even worse”, those with “ready money” who might not need to garner resources by scraping and pinching, are pushing first-time homebuyers out of the market.
That’s right. Apparently investors like you — in all varieties and with all types of funding sources — have “elbowed out” some first time homebuyers.
Of course, when the reporter in question interviewed realtors dealing with the properties, he got answers indicating investors have “restored the health of neighborhood blocks that had become partly vacant and forlorn.” However, that benefit was not even close to the focus of the article. Instead, the focus was squarely on how you investors are taking too much of the action in the real estate recovery.
Why would anyone trust the general press about anything related to business and investment?
The piece went on to predict that banks would start “rationing” their REOs and to discuss how much real estate investors hate short sales, so obviously, this is not an informed reporter. However, the problem is that people like this guy are covering the market, and they are potentially driving new investors right back out of the market for fear of doing a “bad” thing.
Real estate investors will be the body of businesspeople that bring the real estate market back, and I’m starting to think that they’re going to need a PR resource in addition to funding.
Your comments are welcomed below – thank you for reading http://realestate.BryanEllis.com!