The inventory of bank owned and short sale houses has been dramatically reduced in the last six months. But prices have continued to fall. There is competition now for great deals even in owner occupied homes as the bargains are too tempting to pass up. Low ballers are not having success as they are getting out bid. There are still great values to be found in Bend for investors looking for high quality, low priced rentals. A few examples: A built in 2006 three bedroom 2.5 bath home close to the Old Mill district, 1765 SF built in 2006, bank owned and nice for $139,900. A very nice townhome 1495 SF, three bedroom, 2.5 baths, north west location, sold new in 2007 for $279K now selling for $131,500 bank owned. This unit is clean and with several nice options. Nice area with front lawn maintenance done by the HOA. I am working with a property management company who has tenants looking for these type rentals at $950 to $1000 a month. The property manager will place quality tenants for ¼ to 1/2 of a month’s rent. You manage the property yourself afterward. With 25% down these properties can be financed at 5.25% (quoted from lenders I know) and will cash flow in the black from the first day rented. These should have a good potential to appreciate dramatically with any market recovery. With the depreciation write off included the ROI on the initial investment can be 10 to 15% depending on your tax bracket. You can see that with a market recovery a home bought at $131K and appreciating to $175K in two to three years is not unrealistic. That would be a 135% appreciation on your initial down payment and you would not have to feed it money in the mean time. If you are looking to roll cash from other investments or have money parked waiting for good opportunities now may be the time to broadening your investment portfolio into some rental homes. It is difficult to determine whether we have finally seen the bottom of this market but not difficult to see these are some great deals on Bend single family residences. Market activity is picking up even though spring is still a few days off. I prefer these SFR rentals to multi units because the potential price of the house in the future is not determined by the rents as there are first time buyers and other market segments that these homes are ideal for. If you are interested in seeing what some of these homes look like email me back and I will send you a MLS link to see for yourself or I can show them at your convenience. It is said that the money is made in real estate when you buy, not when you sell. These homes might be just that opportunity for you. |