TOM CRONE'S Quick Information on Investment / Income Property Action August, 2006

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Some people make money in the stock market regardless of the DOW numbers, it seems. In reality, the "regardless" is the inaccurate word. With regard to the numbers, they buy or sell accordingly, and pick stocks that accommodate that strategy. The same is true in real estate.

The people who make money in real estate do the same thing. Here's a thought on the current market. Just a thought …

If it's a seller's market, prices are higher than they might be. If it is a buyer's market, sellers are lowering prices and are more desperate to sell. It often becomes a buyer's market when, as now, interest rates are up. When interest rates are up, and if a seller is desperate to sell, alternative financing for investment purposes (i.e. cash flow, equity gain, etc.) are more sensible and more likely. Alternative financing includes all sorts of seller financing. Carry-backs and contracts for deed are examples. Sometimes, sellers do partial seller financing.

If fewer people are buying houses, and if the starter home is more difficult to finance for the lower income or credit challenged people, then what must they do? Rent. Rent, or sleep in the park. If rentals are up, then the risk of rental property ownership goes down.

That’s if for now.

Tom Crone
The opinions expressed in this newsletter are solely those of Tom Crone and others being quoted and do not necessarily reflect the opinions of Coldwell Banker Burnet or its affiliates.