Those with an Eye Can Hunt for Opportunities in this Foreclosure Scenario

March 16th, 2009 | Tags: Foreclosure Market

The foreclosure crisis is showing up many unintended outcomes. Those with an eye can hunt for opportunities in this foreclosures scenario. This statement can be vouchsafed by the fact that the realtors themselves are investing in residential houses that are selling at half the price asked for few months previously.

Bruce Mulhearn of California Realty in Cerritos frankly admitted in an interview that he and some of his colleagues have invested in one such place cited above. The incentive is that these units can be rented out at rates that will cover the mortgage and all related expenses. Something would also be left over.

It has been over 30 yeas that talk about cash flow from that kind of units in the Long Beach Area had been making the rounds. The surprising thing is that in these localities and in the Inland Valley there are multiple buyers hanging around for lucrative deals.

Most of the sellers are bank repossessed or short sales – and hence there are tears behind it. But for others it is opportunity gained. It allows for purchase of units backed by FHA conditions – traditional loan with modest down payment and for those who will reside the interest rate is lower than 6%.

Mulhearn explains that unnoticed in the federal budget is a measure that will take from the rich and give that amount to those with modest income by allowing deduction on residential mortgages for couples with income exceeding $250,000. This is the best way of income distribution. It is expected that by juggling around over $3 billion in extra federal taxes would pop out straight from the housing market.

Realtor Dick Gaylor of Long Beach is a renowned person among his peers. Last year he was the president of the National Association of Realtors. He agrees fully with the measures. His group is initiating a forceful campaign to protect the current mortgage deduction rules.

It may be argued that the renters do not avail of any deduction. But one has to agree that in the throes of a critical recession, in spite of there being opportunities beckoning it is not prudent to worsen the housing situation and its problems.

The realtors have been one of the worst affected groups in the housing crisis. But today they are trying to make the worst of what has happened and looking forward to the future by hunting for opportunities hidden in the darkness.