Justin Douglass

Today I was speaking with a guy from my neighborhood and he was telling me about when he purchased alot of buildings 10 or 15 years ago or more. He used to buy them at 25 or 30k and a few years later sell them for 80 or 100k. Then there was the one that got away, a building offered at 90k and at the time the numbers did not work. Think of that?!!? Even in todays market , the kind of buildings he was buying would cost at least 250k, maybe 300 or more. Ive heard stories like this numerous times, and Ive seen some of the sales prices in doing my research for clients, seeing property prices go from under 50k to 250 and up in the past 20 years. Even as far back as the 70's, there were single family homes being sold for 25,000. Ive heard people doing that in california, in florida, all over. I have to ask myself though, how can that continue? Inflation cant be that much over the next 20 years. Are buildings I will buy for 250 or 300, be worth 500k 20 years from now? Is there a cap to what the prices could be? In some of these states where home prices or multi family prices are 1 million or more, at one time were those properties being bought for 50k? Id love to hear some of your experiences...and guesses on the future of appreciation and if there will be a realistic limit to where "average prices" go?

I just was thinking and decided I should share my thoughts. I would say maybe just very disapointed that some major banks are losing their shirt and if you watch the news, your first thought mite be to feel bad for them. Then I realize in my own professional dealings with the banks and the short sales ive done. The way the banks have treated me and my clients, they almost deserve to be out of business. I have never ever been as frustrated, when as im talking to a representative from any number of banks, its like talking to a wall. You have to ask the exact right question if you want to get an answer. They dont volunteer anything and basically act like they just want to collect the mortgage payment and be done with you. Now I guess I should be more specific about this. Its not really all the short sales, but just the ones where the people had a variable rate and cannot afford the new payment. Ive heard multiple people tell me they offered to pay the bank the full amount of the loan, as long as the bank gave them an affordable rate. Ive actually heard people talk to their banks about this, and then the bank gives up a huge list of stipulations and says, " maybe ifyou pay us this much, we will consider giving you a better rate." Why wouldnt they just change the rate and say "ok, pay us now". If the borrower doesnt pay, then does it really matter if the rate is 6% or 12% ? It only matters to the investors the bank sold the loan. I have heard of some cases where people did get offered a better rate up front, but i wasnt involved so i dont know all the details. I would hope at least some of these lenders still use common sense in their business practices. Instead of getting the full loan amount over time and keeping the borrower in the home, the banks decide to let it go to foreclosure. Or at least they make the borrowers decision a little easier. ( not to make payments ) I dont understand why a bank wouldnt want, say , $300,000 thats owed on a home, at the same interest rate the first 5 years was paid at?? Instead, they end up selling it for $200,000 or even less! Im not a genuis but I would guess that after losing 100k plus on every single loan, is not in the best interest in our country or economy. And im using this example in a relatively small market meaning alot of homes under 300k. I can just imagine what the real numbers are in bigger more expensive markets. Its all Greed to me. Does anyone else share my opinion?