The Real Estate Resuscitation Leans toward the Rich Man

The new recovery is different in the reality that it is primarily affecting those within higher end areas. This time around, the recovery is prejudiced and leaving everyone else in the dark whilst the wealthy are enjoying this new market uptick.

If we have a glance at the major city regions of the United States and their Real Estate markets, a peculiar pattern starts to emerge. We'll see that large hedge funds and overseas investors or buying up the entire prime Real Estate in those areas. The typical man and woman are still making every effort to pay their rent because they got kicked out of their house several years ago after being foreclosed on.

These large institutional investors and foreign nationals are the driving influence behind our market nowadays. These groups of investors are not intrigued by rejuvenating run down neighborhoods or remodeling homes. They want something in good areas, which will rent quickly to upper middle class or high end users. They're looking for a completely turn key solution to their investing demands where they 'd have to invest little to no effort getting the property up to par.

This leaves the locals stuck several years earlier when the market place was slowly moving along. At this point there is still little if any chance for any form of a recovery for John and Jane Doe, especially the folks living in the ghetto.

So here we are once again with a market that is being artificially inflated with speculators. Foreigners, hedge funds and banks are practically purchasing our country. The new American Dream belongs to the wealthy individuals and groups of people. Albeit this does create a new opportunity for those who are smart enough to see it.

What also appears to be taking place are owners in the ghetto inflating their asking prices to absurd amounts thinking that just because they have a piece of Real Estate in an urban area, that it makes them and their property a hot catch. In most instances, when they see that their depreciated piece of Real Estate in the combat zone won't sell for $200k and sits on the market for 3 years, they'll finally realize that regretfully, the marketplace's appreciation is not favoring their neighborhood.

I feel especially sorry for those who are dealing with foreclosure and are hoping to sell their property the old fashioned way- with a Realtor and are trying to get what they owe on their over leveraged house. The real tragedy there is that these individuals have no idea that there exist companies and folks that are actually willing to come in and negotiate a reduced mortgage on their behalf and consecutively buy their house.

South Florida Real Estate Market Cycles 2014 - 2015

 

In this article we're going to discuss the things that move the market place up down and sideways. We'll also delve into the class structure of the market and why some areas are appreciating a lot more than others.

We've all been through quite a joyride in that last number of years, haven't we? The Real Estate market has gone up, down, left, right and sideways - sometimes in a rapid succession. Now we're beginning to feel some form of a recovery in major metropolitan areas such as San Francisco, Miami, New York and Phoenix. This new market does not seem to be nourished by mortgage backed buyers like it was in 2004 - 2006. This new market looks more like an environment tailored for cash-buyer speculators.

Yes, thats right, I said the 'S' word. The marketplace is being flooded with overseas speculators that are once again causing prices to be driven up for Jane and John Doe. Whats peculiar about this Real Estate market revive is that it is happening primarily in upper-middle class to high-end communities. If you focus on the Real Estate markets of the city, you'll notice that the lower-end districts and ghettos are not experiencing any form of appreciation what-so-ever. As a matter of fact, there are still many abandoned and condemned houses lingering around in those areas.

If we take a trip back about a decade from 2015, you'll see that prices where increasing everywhere. People in the inner city were getting rich, albeit temporarily as they 'd splurge all the money they 'd receive from proceeds of sales on 24's, from selling off their properties. Their clients included a mixture of people getting scammed by home mortgage brokers, international investors, speculators, companies and clueless newbies. Now, just because this has all happened historically does not mean that this same group of people don't still exist, they do, but they still don't have any purchasing power as lending is still pretty tough in this market.

Now, what we've been seeing are a great deal of hedge funds coming into the market place and buying properties. This is probably occurring because they're seeing prices rise as a result of activity from these cash-buyer speculators from Europe, Asia and South America. These hedge funds are more attracted to seeing higher returns in Housing because the stock market has not been treating their capital very nicely in the last couple of years. Wall Street is coming back to the market again but this time around its not through mortgages, equity credit lines and other kinds of loans. Now, Wall Street is pouring their money directly into Real Estate and completely eliminating the consumer.

Eventually things will cool down and wall Street will retreat to the stock market once again. In the mean time there are plenty of opportunities no matter what is happening in the market, you just ought to know what you're undertaking.

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