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Ann Arbor Area July Real Estate Housing Statistics

by Group One Realty Team - Real Estate One
HOUSING MARKET HOLDS STEADY

The housing market will hold close to present levels in the months ahead, according to Lawrence Yun, the National Association of REALTORS® senior economist. "Existing-Home sales should be relatively stable over the next few months, holding in a modest range, with some pent-up demand growing from buyers who’ve been on the sidelines," he said.

"Mortgage disruptions will hold back sales over the short term, but long-term fundamentals are favorable. A modest up turn is projected for existing-home sales toward the end of the year, with broader improvement to include the new-home market by the middle of 2008."

The Ann Arbor Area Board of REALTORS® July Housing Statistics demonstrate the economic outlook of Lawrence Yun’s projections. When compared with July 2006, median residential and condominium sales prices are on the rise. New listings show a decline of 13 percent, while pending sales increased 21 percent and average list and sale prices increased by $2,730 and $3,970 respectively.

How to Figure Out Income Property Return Numbers

by Group One Realty Team - Real Estate One

I have to say, one of the smartest investments I have ever made has been to buy residential and commercial income property.  The earlier you buy it the better.  If you are not in a position to buy property on your own, I would suggest that you get together with family or friends and form a sub-chapter S corporation or LLC to purchase larger properties using your combined credit and purchasing power. Shares, estate planning or future transfers can more easily be accomplished without having to either cash out or divest of your investment property using these company investment shells.. 

So how does one get started finding and then selecting the best property available?  I have a rental worksheet that I have used for many years to help me reduce the prospective investment property to "bottom line" numbers.  This really helps in determining which is the best property for you.  I would suggest you download the form and make several copies of it.  Use the sheet while you are in the field looking at the subject property.  Fill it out as you walk through the property, asking questions, noting how many meters are present, who pays the utilities, and confirm what the current rental rates are for the different units.  If you have questions about terms like net operating income (NOI), internal rate of return (IRR), cap rate, gross Rent multiplier (GRM), sinking funds, vacancy factors, etc. please do not hesitate to contact me .  I also converted this rental worksheet to a excel file file as well should you want to use this medium later on.

So how do you get a list of the better properties?  Just click here to search for property and I can always help you find selections that have more potential for income and equity increase.  I most often find when doing a property search that whenever you can make a change in the subject's usage, you stand to increase your equity more that others without that option.  As an example, I once purchased a 4 unit apartment building that was made up of two bedroom units having their own private laundry rooms.  I converted the laundry rooms to bedrooms and was able to offer three bedroom units for rent at a greater monthly rental rate.  I spent about $3,000. to make the conversion and increased the buildings annual income $4,800. (100/mth extra x 12 mths x 4 units).   Using a 10% cap rate, my $3000 investment increased the value of the property $48,000 (4800. x 10%) and provided an equity increase of $45,000 ($48,000 less $3,000) so a good  management adjustment planned as part of the original property investment.  The numbers before this plan were only average which is why we have two sets of numbers on the property field sheet referenced above.  Contact me for more details because it is a Great Time to Buy!

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Tom Stachler
Real Estate One, Group One Realty Team
555 Briarwood Circle
Ann Arbor MI 48108
Direct: (734) 996-0000
Fax: (734) 661-0102