Homes my clients rented

Homes my clients rented

Friday, February 27, 2009

Home prices are so low it may cost less to buy than to rent?

As if it were that simple- In a recent story in the Miami Herald the over simplified notion was again examined and as you can imagine the results makes an even stronger case for renting in a uncertain market. Duhhh. Here's some excerpts from the original article By MONICA HATCHER:

The case for holding off:

There is the risk that home values will keep falling -- especially for condos, analysts have said. The economy may also deteriorate further, threatening job security, and making the thought of taking on a home mortgage even more daunting.

Rents are also declining.

By holding off, renters can avoid paying homeowner and condo association fees that have spiked in many communities because of delinquencies and foreclosures.

Actual property appreciation could be years away.

Lending restrictions could loosen and down-payment requirements ease, tying up less cash in future purchases.

Still Hunter, a vice president of investment in the Fort Lauderdale office of Marcus & Millichap, a real-estate services firm, attributed falling rental prices to a booming shadow market of condos and homes being rented by investor/owners as well as renters rooming together to save money and a decline in foreign workers -- typically renters -- who have headed home as jobs dry up here.


Hunter said his firm's rental outlook for 2009 shows average rents (for one- to three-bedroom apartments) declining in Broward County by 2.6 percent to $1,094 and in Miami-Dade by 1.3 percent to $1,109.

''From my perspective, it makes sense to rent right now, while rents continue to decline and home prices continue to decline. We're not at the bottom,'' Hunter said.

Still, Hunter said, home prices have adjusted so much, it might make sense to jump into the market.

''It's a tough question to answer,'' he said.


Even when prices hit bottom, it doesn't mean they will bounce back up, said Alan Ojeda, chief executive of the Rilea Group, a Miami-based developer of large-scale rental properties. That makes the horizon for profit even longer and means that a buyer in the current market should be committed to a home for several years.

Ojeda, who said he is trying to fill up One Broadway, a new luxury rental tower in Miami's Brickell area, takes it a step further, saying that unless a renter believes a home's price will appreciate in the next three years, he or she would be better off remaining a renter.

''It's the same theory you use when you decide whether to buy or lease a car. What you are looking for is to use a car. If there's no appreciation in a home, wouldn't you prefer to use a home, since after three years you would have spent more money on real estate taxes and the mortgage. What would your gain have been?'' Ojeda asked.

Still, there are signals the blood-letting in the real estate market may be starting to slow. Sales were up significantly in December, the last time figures from the Florida Association of Realtors were available, and that made a dent -- albeit small -- in the number of homes for sale.

Hardin said it was hard to imagine values would continue to fall at the same rate at which they have since the market peaked. Prices are likely to continue falling, but it'll be by smaller percentages, he said.

Unless renters wholeheartedly believe prices will rise over the next several years, they may want to stay put, he said. Aside from the past seven years or so, real estate has always been seen as a long-term investment, Hardin said, so buying low today and selling in 10 years could be lucrative.

Either way, there's little downside in delaying the decision.


Romanello acknowledged there would be little difference in buying now vs. later. She said that among her clients who had decided to wait, the worst that happened was they lost several great opportunities.

'I don't think there is any urgency to buying because I don't think in six months' time prices are going to be up 10 percent,'' Romanello said.

Thursday, February 12, 2009

Rental Market Can't Escape Pain

The housing downturn is finally bringing pain to apartment owners.

In recent years, sky-high home prices followed by a wave of foreclosures helped fill rental apartments and buoyed the real-estate investment trusts that own them. But earnings out Friday morning from Apartment Investment & Management Co., the largest publicly traded U.S. apartment owner, could show that rental apartments can no longer escape housing woes.

Already, the credit crunch has triggered write-downs as REITs freeze new developments. Last week, Aimco said it would take an $107 million charge related to falling land values in California, becoming one of several apartment REITs to take a write-down. The Denver-based REIT also said it would pay 71% of its fourth-quarter dividend in stock to conserve cash. Two apartment REITs have pared their dividends.

The housing bust has shattered the psyche of would-be buyers. But home prices are down so far in some markets that it is now cheaper to buy than to rent, though tighter credit has sidelined buyers. Meanwhile, job losses are highest among the age cohort most likely to rent, 20- to 34-year-olds.

Congress is considering a raft of goodies for potential home buyers, including a $15,000 tax credit and federally subsidized 4% mortgage rates. And an effort to allow bankruptcy judges to write down mortgages for struggling homeowners could keep would-be tenants from becoming renters.

—Nick Timiraos--- WSJ.com

Thursday, January 22, 2009

Real estate developer Trammell Crow, who founded the Wyndham Hotel Co. and helped sculpt the Dallas skyline, died yesterday at his family farm in eastern Texas. He was 94.

Crow built his first commercial real estate project in 1948. He also founded Trammell Crow Co., a property manager and brokerage sold in 2006 to CB Richard Ellis Group Inc. in a transaction valued at $2.2 billion.

``The world will remember Mr. Crow as a legendary real estate developer and businessman because of his unparalleled vision and passion for success,'' Jim Carreker, a former chief executive officer of Trammell Crow Co. and Wyndham Hotels, said in a statement e-mailed Monday from Crow Holdings LLC.