Monday, June 4, 2007

Mid-year real estate slump

I haven't been too active the last couple of weeks in my real estate business, since work was completed on my Cheektowaga home. We have been holding open houses every Sunday and I did get the property listed on the MLS through a flat-fee listing service. I've had several calls from sellers wanting me to look at their properties but have not followed up.

So what is going on? Part of it may be burnout from working 7 days a week for 3 months rehabbing the Cheektowaga home. Part may be work related - I just was assigned a new Black Belt project in a process area I am unfamiliar with, that was supposed to take 40% of my time. Of course, the project is taking nearly double that amount of time and I am working at my job longer hours.

The other issue is cash flow. I am really hesitant to take on new properties at the moment because my cash could quickly be eaten up if the Cheektowaga house does not sell. It is costing me about $2k per month just in PITI to hold it and I do not have a lot of margin for price reduction. I was listening to the radio this morning and a staging expert stated that an empty house looked just as bad as a cluttered house, so I may have to spend money to put some furniture in the house.

Most of my calls from sellers right now are from less desireable Buffalo neighborhoods. Property in these areas has a 7 month average time on the market, so I rationalize that it is not worth my time to call these sellers back. I have a fixer upper for sale in Buffalo that is not getting any interest.

I had a home that was in a great suburb that looked like it would be worth buying even if the bank did not accept much of a short sale, but the seller has disappeared and I can't get the necessary paperwork signed to proceed.

One other property I worked on is about to go to auction next week. I nearly had a deal with the bank at ~ $50k when a real estate agent got the seller to put the house on the market for $84k. Of course, no one is interested in the property, and so the seller will get the judgement on their record. Ultimately, the bank will lose as well, so only the Realtor will benefit from this sale.

The last 2 Saturdays I have gone mountain biking and felt detached from real estate. I think that I need to come out of my mid-year slump and get to work again.

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