If
anything has changed in the Charlotte market since the early June installment
of this newsletter, it has been a further tightening of inventories and
increased competition for better values. Twice this week I noted
properties with good upside potential as they entered the market, and passed
them along to clients whom I thought they might interest. In both cases,
these properties were under contract within less than 24 hours of having been
offered for sale. We won’t know the contract prices until they close, but
it is probably a fair bet that both properties went under contract above the
listing prices— perhaps significantly above. Otherwise, why would the
sellers have accepted offers so quickly? Good values still present
themselves in this market. Getting them under contract is just a bit more
difficult. Serious investors need to be prepared to act quickly and
aggressively. Offers need to be based on solid analysis of the
data—lowball offers are probably a waste of time; and reasonable ceilings for
offers need to be established from the data. Then a decision needs to be
made on whether a quick, aggressive offer is more reasonably calculated to get
the property under contract than the old expectation that there will be time
for offer and counteroffer. Properties initially offered at prices that
allow for good upside are almost certain to receive multiple offers in this
climate anyway. So going in “strong” is probably the better play, as long
as the buyer is confident that an accepted offer will leave sufficient room for
an acceptable return on investment. This takes some knowledge, solid
analysis and a level of sophistication that often escapes less seasoned real
estate investors.
Having
said there, the following are summaries of 18 suggested properties in this
edition of the newsletter. As you know, I try to suggest properties to an
array of investors with a variety of strategies. What works for one may
not meet the goals of another. The link at the bottom of the page will
take you to full MLS reports for each of the properties in the summary below.
#1
– MLS 3160096 – This is a 3BR/2BA with 2,575 sq.ft. of HLA in Denver
(28037). It is a Fannie Mae REO, listed at $184,900, with a tax value of
$222,133. (Reminder: as the market continues to recover, the buyer is
well advised to focus less on tax value as an estimate of market value.
Market values in many areas of metro Charlotte have recovered well beyond tax
values. A review of recent comparable sales is the best way to estimate
market value or ARV- “after rehab value.”)
#2
– 3179459 – 3BR/2.5BA HUD home (HUD liquidates FHA foreclosures, for those of
you who do not know this. HUD also usually offers a property exclusively
to owner-occupants for the first 15 days on the market. Thereafter, it is
available for investor offers.) This one has 21 days on the market, is
located in SE Charlotte (28227), has 1,555 sq.ft. of HLA and is listed at
$102,000.
#3
– 3186503 – Large 5BR/5BA home with 5,754 sq.ft. of HLA located in a very
desirable area of south Charlotte (assigned to sought-after Providence High
School). This REO is listed at $387,900 and has a tax value of $515,900.
#4
– 3171588 – 4BR/3.5BA Harrisburg REO being offered through “auction” liquidator
HUBZU. (Be aware that HUBZU usually charges a 4.5% buyer premium, in
addition to the purchase price). This one has 3,258 sq.ft. of HLA and is
listed in the MLS at $324,900, with a tax value of $384,350. Starting
“bid” is probably well below listing price. (I can’t call it a “bid” or
an “auction” with a straight face—it is usually just offer and counteroffer
because the seller sets a “reserve” below which it won’t sell the home anyway;
but HUBZU can still be a source of good values from time to time.)
#5
– 3145920 – 6BR/4BA home with 4,318 sq.ft. of HLA on a 1.05 acre golf course
lot in Statesville. This one is an estate sale and is listed at $300,000,
with a tax value of $362,140.
#6
– 3158790 – 3/2.5 with 3,468 sq.ft. of HLA (and 2,048 sq,ft of unheated area in
a walk-out basement) on 1.16 acre in Statesville. This REO is priced at
$229,900, with a tax value of $281,580.
#7
– 3166062 – 3/2 in a very hot area for investors near Uptown, light rail,
etc.—Madison Park. This one is also on a decent-sized .29 acre lot (at
some point in the future, the owner might decide to demolish the existing
structure a build a custom home on the lot, as property values in this are
continue to rise). This one is not a distress sale, but it is in rough
condition. It has 1,565 sq.ft. of HLA and is priced at $223,900 after 73
days on the market.
#8
– 3186194 – This is a 3/2 in another hot area just south of Madison Park.
This one is a 1,247 sq.ft. home, listed at $192,400. One of the good things
about this home and #7 above is both have 2 full baths as currently
configured. They may need cosmetic updating, but there is no need to
convert a ½ bath to a full bath, as is often the case in these older areas.
#9
– 3160364 – 3/2 with 1,406 sq.ft. of HLA on .41 acre in Harrisburg. This
REO has been reduced to $179,900, with a tax value of $186,340.
Harrisburg is generally a desirable area because schools perform well and it is
located conveniently near Charlotte.
#10
– 3189998 – 4BR/2.5BA home built in 2007 with 3,086 sq.ft. of HLA in SE
Charlotte (28215). This is not a distress sale, but it is vacant.
It might make a decent “base hit” under a rent-and-hold strategy, if bought
right. It is listed at $165,000 with a tax value of $166,100.
#11
– 3185404 – 4BR/2.5BA HUD home with 1,912 sq.ft. of HLA, built in 2005 (again,
relatively new, so anticipated rehab costs would probably be minimal).
This one is located in NE Charlotte (28213), it has 16 days on the market at
the date of this publication, so it is available to investors. Listing
price is $160,000.
#12
– 3186711 – 3BR/2.5BA built in 2009 in Concord. This one is not a
distress sale, but it has been reduced after only 13 DOM to $160,000,
indicating the sellers are probably motivated. It has 1,987 sq.ft. of HLA
and a tax value of $154,750.
#13
– 3187923 – 4BR/3.5BA VA foreclosure with 2,541 sq.ft. of HLA in north
Charlotte (28214), priced at $150,900 with a tax value of $161,500.
#14
– 3190730 – 4BR/2.5BA Fannie Mae REO with 2,268 sq.ft. of HLA in zip code 28213
(University area), priced at $148,900.
#15
– 3189272 – 4BR/2BA REO with 2,360 sq.ft. of HLA in Kannapolis. This
modular home is on 1 acre and is priced at $139,900 with a tax value of $155,735.
#16
– 3185941 – 3/2.5 REO built in 2003 with 2,077 sq.ft. of HLA located in N.
Charlotte (28214). This one is also being liquidated through HUBZU.
The listing price is in the MLS is $132,500 and tax value is $131,100.
#17
– 3188195 – 3/2.5 HUD home in 28215 (Kingstree subdivision) with 1,813 sq.ft.
of HLA and 8 DOM on the date of this publication. It is offered at
$115,000, with a tax value of $118,400.
#18
– 3189140 – 3/2 REO with 1,441 sq.ft. of HLA in N. Charlotte (28269), listed at
$86,900 with a tax value of $123,900.
A
link to Full MLS Reports, including photos, for all of these properties appears
below:
Click the following link to view the Residential:
http://matrix.carolinamls.com/DE.asp?k=331377XSXZH&p=DE-26554922-481
As
always, if you have any questions or comments, please do not hesitate to
contact me.
Eric J. Dorer, B.S., J.D.
Broker/Realtor
Eric J. Dorer Real Estate
2740 Oxborough Drive
Matthews, NC 28105
Tel: (980)875-0950
e-fax (877)362-0917
email: ejdorer@gmail.com
web site: www.EricDorerRealEstate.com
