43 Urban Village Live + Work New Construction written by: Frank Vigliotti, Realtor®, Global Sales…
Investors Have Intentions to Purchase More South Florida Real Estate
In spite of the lack of housing inventory and increasing property prices, 65% of active real estate investors intend on purchasing the same amount of homes over the next 12 months as they in the previous 12 months. This statement is based on information released from Memphis Invest and ORC International which was established in 1938. To give you an idea of how reliable the ORC international is, they’ve lead the CNN polls since 2007.
Upcoming Activity in the Real Estate Market
This study also noted that 39% of active real estate investors have intentions to buy more homes throughout the next 12 months and 26% have intentions to purchase about the same amount of properties as they did over the last 12 months. These 2 collections of investors combined are equivalent to about 4.5 million investors. Out of all of the active real estate agents surveyed, only 30% of them have intentions to purchase fewer homes over the next 12 months than they did over the prior 12 months. Based on data released from the National Association of Realtors, real estate investors purchased 1.23 million homes in 2011. This is a 64% growth compared to the 749,000 homes purchased by investors in 2010.
Who Are These Real Estate Investors?
7 million individuals which is about 3% of the American adult population recognize themselves as real estate investors. On top of that, 9% of all American adults are currently in possession of an investment property but have no intentions of purchasing any more. According to this survey, 1 out of 8 Americans or 28.1 million people recognize themselves as residential real estate investors or are in possession of residential investment properties.
Massive amounts of short sales and foreclosures are making their way into the real estate market and rent prices are persistently rising in most areas. These factors help to create a beneficial setting for the 28.1 million residential real estate investors in the United States. This large group of American investors is roughly equivalent to the amount of individuals in America who own Roth IRA’s (28.5 million) or the overall amount of money market fund shareholders. (29 million) In other words, this group of investors has noteworthy buying power.
On average, property restoration comes out to about $7,500 per home which means that real estate investors are spending about $9.2 billion annually to restore properties damaged by foreclosure situations. This overall expense is roughly 400% more than what the federal Neighborhood Stabilization Program spends annually.
This survey helps to actually identify the amount of money that investors are putting into these properties to help rebuild the struggling housing market. These investors are essentially improving their local economies by contributing billions of dollars with local plumbing companies, flooring companies, electricians, and contractors in throughout these renovations.
Encouraging Real Estate Investment
This study indicated that lower interest rates and the elimination of financing access limits could offer inducements to investors. 70% of those surveyed believe that lower interest rates would cause active real estate investors to be more eager to invest in more properties. 54% of survey respondents indicated that there should be more tax incentives for money spent investment properties. 46% of those surveyed indicated that some of the restrictions enforced by lenders should be removed regarding the amount of capital they’d lend to investors. 44% of respondents agree that rules on section 1031 Exchanges should be simplified. Surprisingly, only 30% indicated that they would purchase more properties if securities laws regarding the pooling of capital by investors for home purchases were modified
Fort Lauderdale Real Estate News | Investors Buying Real Estate in South Florida
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