2012 is set to be a year of many changes, including many new trends that continue to evolve in the world of real estate investing. So what can we expect in the new year and how can real estate investors stay ahead?
government programs
It is very likely that we will see one or two new rounds of government initiatives before the 2012 presidential election. However, as with the last few, they are unlikely to directly help many homeowners and, if anything, will further restrict more conventional home loans instead of relaxing them. Perhaps the only exception is the FHA’s extension of the waiver of the 90-day rule. These investors can easily continue to sell homes to new buyers who can use low down payment financing right away.
Inventory
Inventory levels should continue to decline, despite a final liquidation of the remaining foreclosures in progress at this time. Banks will continue their strategies to keep home prices rising and a continued rally will balance new listings. However, in many parts of the country, real estate investors will find a shortage of REOs and short sales continue. This will mean the need to work with major bulk REO buyers to source a significant number of wholesale properties, which means forging new contacts and partnerships is now critical.
Growth
The current improvements in the US housing market are likely to continue and expand exponentially. Home ownership will continue to rise gradually and the newfound confidence of US buyers should offset any slowdown in demand from foreign investors who are also seeing their own home markets recovering. As far as hot spots go, coastal resort areas and cities with the best job markets should produce the highest returns. Among the best options for 2012 are New York, Miami, San Francisco, San Jose and Washington.
mortgage loans
Since conventional mortgages are still hard to come by, especially for higher priced properties, we will likely see more growth in the lower price ranges. As real estate investors become more aware of the availability of transactional financing and focus their marketing more on attracting buyers, transactional lenders will likely be among the biggest winners of the new year.
Marketing
Marketing will experience some of the biggest changes for real estate investors throughout 2012. Investors shouldn’t just sit around planning budgets and dates for next year’s marketing, but focus on developing more permission-based and mobile marketing initiatives, as well as local searches. Trying to catch up with the new trends next year will mean an uphill battle. The time to start developing is now so that the large number of cash rich buyers at tax time can collect.
