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RealtyTrac Equity Trust Presentation
 

RealtyTrac Equity Trust Presentation

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Presentation given at the Equity Trust Networking Conference in Orlando, Fla., on Sept. 22, 2013 on leveraging the latest housing market trends to land great real estate deals.

Presentation given at the Equity Trust Networking Conference in Orlando, Fla., on Sept. 22, 2013 on leveraging the latest housing market trends to land great real estate deals.

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  • RealtyTrac started 1996.Track over 100 million properties nationwide.
  • U.S. & State Foreclosure Starts Apr05-May13
  • Add Networking

RealtyTrac Equity Trust Presentation RealtyTrac Equity Trust Presentation Presentation Transcript

  • LEVERAGE THE LATEST HOUSING TRENDS TO LAND THE BEST REAL ESTATE DEALS © 2013 Renwood RealtyTrac LLC WELCOME
  • WHAT WE’LL COVER TODAY • Latest home sales & price trends • Latest foreclosure trends • Trends in property flipping – Best markets for flipping • Trends in single family rentals/institutional investors – Best markets for buying rentals • The problem and opportunity of zombie foreclosures • Leveraging the latest trends – Knowing the markets where you want to invest – Buying short sale, auction, bank owned © 2013 Renwood RealtyTrac LLC
  • REALTYTRAC DATA PRIMER Economic Neighborhood & Local MLS Sales & Loan Valuation & Prop Details Foreclosure © 2013 Renwood RealtyTrac LLC
  • REALTYTRAC DATA PRIMER County-Level Public Documents • Pre-foreclosure, foreclosure auction and REO • Sales & Loan • Valuation and property characteristics MLS • Listing status, price and other info • Property description and more characteristics Publicly available datasets • Neighborhood features, amenities, red flags • Macro housing and economic metrics © 2013 Renwood RealtyTrac LLC
  • LATEST HOME PRICE TRENDS © 2013 Renwood RealtyTrac LLC
  • LATEST HOME PRICE TRENDS © 2013 Renwood RealtyTrac LLC Distressed median prices still flat lining Overall home prices up annually for 17 straight months. UP 23 percent from bottom, still 26 percent below peak.
  • LATEST HOME PRICE TRENDS © 2013 Renwood RealtyTrac LLC Average Annual Pct Change YTD in 2013 is 7 percent for non- distressed properties
  • LATEST HOME PRICE & SALES VOLUME TRENDS © 2013 Renwood RealtyTrac LLC Sales volume increasing but low inventory helping to push prices up
  • STATE LEVEL SALES VOLUME TRENDS © 2013 Renwood RealtyTrac LLC Lack of for-sale inventory may be slowing sales in California and Arizona
  • LATEST HOME PRICE TRENDS – LOCAL MARKETS © 2013 Renwood RealtyTrac LLC Cash buyers increasingly winning out in tight credit market with low inventory of homes for sale
  • LATEST HOME PRICE TRENDS: NATIONWIDE © 2013 Renwood RealtyTrac LLC Seriously underwater means mortgage amount is at least 25 percent higher than estimated market value
  • UNDERWATER DATA BY COUNTY • County-level interactive heat map • http://www.realtytrac.com/Content/news-and-opinion/seriously-underwater- homeowners-county-heat-map-7856 © 2013 Renwood RealtyTrac LLC
  • HOME EQUITY PROFILES FOR MAJOR METROS © 2013 Renwood RealtyTrac LLC • http://public.tableausoftware.com/shared/HTMMWH5ZG?:display_count=yes
  • HOME PRICES BUOYING UNDERWATER INVENTORY 4.5 million homes nationwide would transition from short sales to equity sales with 10 percent increase in home prices; 8.3 million with a 20 percent rise
  • LATEST FORECLOSURE MARKET TRENDS © 2013 Renwood RealtyTrac LLC
  • HOW LONG WILL SHORT SALE SURGE LAST? © 2013 Renwood RealtyTrac LLC August foreclosure starts at lowest level since December 2005
  • LATEST FORECLOSURE TRENDS – LOCAL MARKETS © 2013 Renwood RealtyTrac LLC Classic U-Shaped Recovery
  • LATEST FORECLOSURE MARKET TRENDS – METRO MARKETS © 2013 Renwood RealtyTrac LLC More of a V- shaped recovery but could turn into a W-recovery
  • LATEST FORECLOSURE MARKET TRENDS – METRO MARKETS © 2013 Renwood RealtyTrac LLC Started as U but ending up as a V
  • LATEST FORECLOSURE MARKET TRENDS – METRO MARKETS © 2013 Renwood RealtyTrac LLC Steady plodding
  • LATEST FORECLOSURE MARKET TRENDS – METRO MARKETS © 2013 Renwood RealtyTrac LLC A little less steady plodding
  • LATEST FORECLOSURE MARKET TRENDS – METRO MARKETS © 2013 Renwood RealtyTrac LLC Still flatlining
  • LATEST FORECLOSURE MARKET TRENDS – METRO MARKETS © 2013 Renwood RealtyTrac LLC L-Shaped recovery with clear signs of a U developing
  • LEADING THE RECOVERY © 2013 Renwood RealtyTrac LLC
  • LAGGING THE RECOVERY © 2013 Renwood RealtyTrac LLC
  • LATEST FORECLOSURE MARKET TRENDS © 2013 Renwood RealtyTrac LLC Arizona time to foreclose less than half the national average of 526 days
  • LATEST FORECLOSURE MARKET TRENDS RECAP • Foreclosure activity is well past its peak nationwide • Some state and local markets are lagging in recovery because of lingering foreclosures • States that have enacted more aggressive foreclosure prevention legislation over the past few years are susceptible to a rebound in foreclosure activity • For investors this means there will still be opportunity to find discounted foreclosures going forward in some markets over the next two years. © 2013 Renwood RealtyTrac LLC
  • WHERE FORECLOSURE STARTS & AUCTIONS ARE REBOUNDING © 2013 Renwood RealtyTrac LLC
  • WHERE FORECLOSURE STARTS & AUCTIONS ARE REBOUNDING YoY Pct Increases: • Maryland: 365% • Connecticut: 47% • New York: 36% • New Jersey: 27% • Oregon: 59,200%
  • WHERE FORECLOSURE STARTS & AUCTIONS ARE REBOUNDING © 2013 Renwood RealtyTrac LLC YoY Pct Increases: • Florida: 100% • Arkansas: 71% • Illinois: 65% • Wisconsin: 45% • Washington: 21%
  • LATEST FORECLOSURE MARKET TRENDS © 2013 Renwood RealtyTrac LLC
  • LATEST FORECLOSURE MARKET TRENDS © 2013 Renwood RealtyTrac LLC
  • HOW LONG WILL SHORT SALE SURGE LAST? © 2013 Renwood RealtyTrac LLC
  • WHERE FORECLOSURE STARTS & AUCTIONS ARE REBOUNDING • Why are foreclosure starts and auctions rebounding? – Pent-up foreclosure activity from robo-signing, national mortgage settlement and state legislation/court rulings – Rising prices may be helping to motivate foreclosure • What are implications for real estate investors? – Clock is now ticking on delinquent homeowners – Auctions may be good place to buy in next 6 to 12 months © 2013 Renwood RealtyTrac LLC
  • TRENDS IN PROPERTY FLIPPING © 2013 Renwood RealtyTrac LLC
  • FLIPPING TRENDS U.S. property flips increased 17 percent from a year ago in the second quarter
  • FLIPPING TRENDS © 2013 Renwood RealtyTrac LLC Arizona flips down 35 percent YoY. Gross profit $21K per flip
  • FLIPPING TRENDS © 2013 Renwood RealtyTrac LLC Phoenix flips down 36 percent YoY. Gross profit $26K per flip
  • BEST MARKETS FOR FLIPPING © 2013 Renwood RealtyTrac LLC
  • WHAT YOU BUY MATTERS - FLIPS ©RealtyTrac Inc. 2013, Not for Distribution Metro Numberof2012Flips AvgPurchasePrice AvgFlipPrice GrossProfit GrossReturnPct LasVegas 1,525 $124,849 $246,347 $121,498 97% Atlanta 1,396 $91,873 $102,096 $10,223 11% Riverside-SanBernardino,CA 1,004 $185,429 $210,177 $24,748 13% CapeCoral,FL 802 $98,747 $113,979 $15,232 15% Denver 591 $223,323 $230,417 $7,094 3% Sacramento 496 $198,369 $225,917 $27,548 14% Miami 486 $132,476 $177,256 $44,779 34% Orlando 480 $98,122 $205,727 $107,605 110% Sarasota,FL 356 $116,428 $157,443 $41,014 35% PortSt.Lucie,FL 273 $89,894 $130,380 $40,486 45% Jacksonville,FL 271 $80,249 $119,345 $39,096 49% Seattle 250 $220,018 $231,263 $11,245 5% Flipping data for 3-bedroom single family homes built in 1990 or later
  • WHAT YOU BUY MATTERS - FLIPS ©RealtyTrac Inc. 2013, Not for Distribution Metro Numberof2012Flips AvgPurchase Price AvgFlipPrice GrossProfit GrossReturnPct LosAngeles 981 $247,660 $328,077 $80,417 32% SanFrancisco 273 $251,091 $317,343 $66,252 26% Denver 249 $149,778 $197,265 $47,487 32% Riverside-SanBernardino,CA 201 $102,571 $131,716 $29,145 28% Sacramento 146 $120,761 $146,443 $25,682 21% Miami 132 $88,442 $125,562 $37,121 42% SanDiego 119 $232,261 $310,801 $78,540 34% Seattle 108 $152,905 $203,199 $50,294 33% Cincinnati 107 $46,327 $48,944 $2,616 6% Detroit 102 $57,455 $56,325 ($1,131) -2% Portland 102 $146,713 $199,693 $52,980 36% Atlanta 91 $68,715 $84,178 $15,464 23% Flipping data for 2-bedroom single family homes built 1920 to 1950
  • TRENDS IN SINGLE FAMILY RENTALS/INSTITUTIONAL INVESTORS © 2013 Renwood RealtyTrac LLC
  • RENTAL ROI STILL GOOD IN MANY MARKETS © 2013 Renwood RealtyTrac LLC
  • FLIPPING & INSTITUTIONAL INVESTORS © 2013 Renwood RealtyTrac LLC U.S. institutional investor purchases increased 16 percent from year ago in Q2
  • FLIPPING & INSTITUTIONAL INVESTORS © 2013 Renwood RealtyTrac LLC Phoenix only metro among top 10 with decrease in purchases in 2013
  • HOW SINGLE FAMILY HOMES ARE BEING PURCHASED © 2013 Renwood RealtyTrac LLC
  • TOP 25 HIDDEN GEM SINGLE FAMILY RENTAL MARKETS © 2013 Renwood RealtyTrac LLC
  • TOP SATURATED SINGLE FAMILY RENTAL MARKETS ©RealtyTrac Inc. 2013, Not for Distribution 48 # Metro Area Investor % 1 Atlanta-Sandy Springs-Marietta, GA 24% 2 Charlotte-Gastonia-Concord, NC-SC 20% 3 Macon, GA 18% 4 Memphis, TN-MS-AR 18% 5 Jacksonville, FL 18% 6 Tampa-St. Petersburg-Clearwater, FL 17% 7 Winston-Salem, NC 16% 8 Las Vegas-Paradise, NV 16% 9 Lakeland, FL 16% 10 Orlando-Kissimmee, FL 14% 11 Albuquerque, NM 14% 12 Palm Bay-Melbourne-Titusville, FL 14% 13 Athens-Clarke County, GA 14% 14 Greensboro-High Point, NC 13% 15 Miami-Fort Lauderdale-Pompano Beach, FL 12% 16 Deltona-Daytona Beach-Ormond Beach, FL 12% 17 Phoenix-Mesa-Scottsdale, AZ 12% 18 Montgomery, AL 12% 19 Bakersfield, CA 11% 20 Reno-Sparks, NV 11% 21 Detroit-Warren-Livonia, MI 11% 22 Boise City-Nampa, ID 11% 23 Sarasota-Bradenton-Venice, FL 11% 24 Vallejo-Fairfield, CA 10% 25 Gainesville, GA 10%
  • THE PROBLEM & OPPORTUNITY OF ZOMBIE FORECLOSURES © 2013 Renwood RealtyTrac LLC
  • THE PROBLEM AND OPPORTUNITY OF ZOMBIE FORECLOSURES © 2013 Renwood RealtyTrac LLC Nationwide vacant foreclosures account for one in every five properties in foreclosure
  • THE PROBLEM & OPPORTUNITY OF ZOMBIE FORECLOSURES © 2013 Renwood RealtyTrac LLC
  • THE PROBLEM & OPPORTUNITY OF ZOMBIE FORECLOSURES • The problem – More than 150,000 vacant homes nationwide, 20 percent of all homes in the foreclosure process – Homeowners often don’t realize they still own the property and are responsible for taxes etc. • The opportunity – Homeowners who have exhibited a desire to let go of the property – Lenders who don’t want to foreclose © 2013 Renwood RealtyTrac LLC
  • THE PROBLEM & OPPORTUNITY OF ZOMBIE FORECLOSURES © 2013 Renwood RealtyTrac
  • LEVERAGING HOUSING TRENDS: KNOW YOUR MARKET © 2013 Renwood RealtyTrac LLC Recent default, auction and REO trends Local, state and national foreclosure rates
  • LEVERAGING HOUSING TRENDS: FIND MARKETS WITH REBOUNDING FORECLOSURES © 2013 Renwood RealtyTrac LLC Foreclosure Inventory and Prices Historical Foreclosure Discounts 3. Know your overall market
  • LEVERAGING HOUSING TRENDS: FIND-OFF MARKET HOMES © 2013 Renwood RealtyTrac LLC Find pre-foreclosures and scheduled auctions in your neighborhood
  • LEVERAGING HOUSING TRENDS: CONTACT HOMEOWNERS © 2013 Renwood RealtyTrac LLC Create mailing lists of distressed homeowners in default or scheduled for foreclosure auction
  • LEVERAGING HOUSING TRENDS: TARGET MOTIVATED SELLERS © 2013 Renwood RealtyTrac LLC Identify homeowners who have vacated their homes and get new mailing addresses
  • FIND MOTIVATED SELLERS WITH EQUITY © 2013 Renwood RealtyTrac LLC
  • FIND MARKETS/HOMES WITH GOOD POTENTIAL CAP RATES © 2013 Renwood RealtyTrac LLC • Buy for $20K (possibly less at auction) • Rent for $1000 a month • Est. carrying costs at $500 a month • Cash flow of $500 a month • Cap rate of 30%!
  • FIND MARKETS/HOMES WITH GOOD POTENTIAL CAP RATES © 2013 Renwood RealtyTrac LLC • Buy for $105k (REO) • Rent for $1,284 a month • Est. carrying costs at $514 a month • Cash flow of $770 a month • Cap rate of 9%
  • FIND HOMES/MARKETS WITH GOOD FLIPPING POTENTIAL © 2013 Renwood RealtyTrac LLC • List price $46,500, Est. After-Repair Market Value: $117,088 • Sold back to bank for $23,600, so they are motivated to sell low
  • RESOURCES FOR LEVERAGING THE LATEST HOUSING TRENDS • Real Estate News & Reports (free) • http://www.realtytrac.com/content • Local Stats & Trends (embeddable) • http://www.realtytrac.com/trendcenter/ • Premier subscription (address-level access) • Get 12 months for the price of 5 if you sign up at the Equity University Networking Conference • We’ll throw in this complete presentation and local data spreadsheets behind it absolutely free! • Download data/create lists: http://mega.realtytrac.com © 2013 Renwood RealtyTrac LLC
  • DAREN BLOMQUIST VICE PRESIDENT, REALTYTRAC DAREN.BLOMQUIST@REALTYTRAC.COM © 2013 Renwood RealtyTrac LLC THANK YOU!