The Waller Group Investor Services

Explosive Growth in Texas Investment Buyers

Investors across the globe are purchasing single family rental properties throughout Texas. Texas migration patterns, the strong economy, and lack of financing are driving rents to skyrocket. Rents have increased almost 10% in east Dallas, Uptown and other areas throughout the metroplex. The luxury rental market and the market that previously fell within the range of first time home buyers is now further hollowing out the rental market. The lack of financing available for first time home buyers coupled with distressed sales such as short sales and foreclosures, creates the perfect storm for investor purchases...Another game changer is how residential real estate is now viewed as an asset class by institutional investors and private equity funds. Many funds that have been buying in the sand states, (Florida, Nevada, Arizona and California) are now buying in Texas due to the lack of distressed inventory.
The amount of capital that has been on the sidelines for the last five years in the distressed debt market has created a lot of pent up demand for distressed mortgage debt. A lot of that capital is now being transitioned into the residential single family market. Logan Waller, President of Waller Group Properties and Waller Group Property Management provides services for several hedge funds and many individual investors. “An Australian hedge fund that could purchase anywhere in the world chose to first invest in North Texas. This speaks volumes for our N. Texas Market, we have worked with investors for years since we list properties for most of the major banks and servicers. The difference in the investors over the last year is that they are institutional and high net worth individuals...The investors in years past have been less sophisticated property flippers that were looking for a quick return, usually with unrealistic expectations. They can no longer compete with our institutional investors and high net worth individuals that use our platform of services from acquisition, renovation, accounting, make ready and lease up; providing a true passive investment to the investor. High net worth individuals have the ability to take advantage of the low interest rates through cross collateralizing their assets, allowing them to borrow at almost half the cost of a typical first time home owner.”
 With increasing rents, investors are seeing a 7-14% cash on cash return on their money.  As the stock market becomes more volatile, an income producing investment property that can be purchased for 1/4th of replacement cost is a VERY attractive alternative."


Logan Waller,
Waller Group Properties
214.704.5001
Dallas•Austin•Houston

Homebuyer Interest In Foreclosures Increases In The U.S. #Foreclosures

 

Homebuyer interest in purchasing a foreclosed property more than doubled in the past 2 1/2 years even as the U.S. available inventory shrinks, according to a Realtor.com survey.The share of buyers who say they’re likely to purchase a foreclosed home jumped to almost 65 percent from 25 percent in October 2009,...

 

Homebuyer Interest in Foreclosures Increases in the U.S.

By Prashant Gopal - May 30, 2012 5:00 AM CT

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Homebuyer interest in purchasing a foreclosed property more than doubled in the past 2 1/2 years even as the U.S. available inventory shrinks, according to a Realtor.com survey.
The share of buyers who say they’re likely to purchase a foreclosed home jumped to almost 65 percent from 25 percent in October 2009, according to the telephone poll by Realtor.com, the National Association of Realtors’ website. The survey was conducted this month and the results were released today.
U.S. foreclosure filings fell to a five-year low last month as lenders sought to avoid repossessing properties and a housing recovery showed signs of taking hold, RealtyTrac Inc. reported on May 17. The number of default, auction and seizure notices sent to homeowners dropped 14 percent from a year earlier and was the lowest tally since July 2007.
“Because prices are getting towards the bottom, people see foreclosures as even a greater value because they’re usually priced below market,” Steve Berkowitz, chief executive officer of Campbell, California-based Move Inc. (MOVE), which operates the Realtor.com website, said in a telephone interview.
Home prices in 20 U.S. cities fell in the 12 months ended March at the slowest pace in more than a year. The S&P/Case- Shiller index of property values dropped 2.6 percent from a year earlier following a 3.5 percent decline in February, the group reported yesterday.
Almost 56 percent of respondents in the Realtor.com survey said they are concerned that major lenders will release backlogged foreclosures onto the market and bring down values in their markets.
A “gradually rising foreclosure tide” forecast by Irvine, California-based RealtyTrac after a February settlement by the nation’s biggest mortgage servicers over faulty documentation practices has yet to materialize. Banks have been finding alternatives to seizures, such as approving the sale of distressed properties for less than the amount owed on them.
The Realtor.com survey of 1,004 adults was conducted from May 4 to 6 and has a margin of error of 3 percentage points.
To contact the reporter on this story: Prashant Gopal in New York at pgopal2@bloomberg.net
To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net