One of the huge advantages of a team is the incredible blend of skills, knowledge and experience each member brings to the team and our clients. One area of expertise that more and more clients need from their real estate agent concerns real estate as an investment.

We are fortunate that Craig has experience as a financial advisor and has a personal love of the stock market to fuel his continued interest. We recently received an inquiry about whether the time is right and ripe for investing in real estate versus the stock market. Here is Craig’s response:

Thanks for your inquiry and we would be happy to help you evaluate the market to determine if now or later is a good time for you to get into the real estate market as an investor.  As an investor myself in both securities and real estate, I appreciate the process of evaluating what type of investments make the most sense at any particular point of time.  Then, the challenge is to do enough homework to determine what specific investments to add to one’s portfolio and last but not least come up with the criteria to determine the right time to actually pull the trigger to buy and then subsequently to sell.  In my own investments I have applied both a technical analysis and a fundamental analysis to this process.  I won’t bore you with all the details, but suffice it to say that there are a lot of variables in this process and no crystal ball.  So, sometimes it’s a matter of either developing a system you set up to make the buy & sell decision, or taking all the data into consideration and going with a gut feel.  In my case I have used both. 

At the current time in the real estate market there are a number of variables that indicate that this is a good time to buy properties.  First, we had several years of phenomenal growth in real estate followed by the last couple of years of heavy declines.  The question is whether this decline (pullback) is sufficient, or is there more to come.  But here’s the kicker from my view point, if you look at the heavy decline in home prices, it appears that the rate of decline is slowing or even bottoming in certain locations.  Plus, interest rates are still at a relatively all time low.  So, even if the market does continue to gradually decline a bit more, the chances for a significant drop from here is getting lower.  Conversely, the chances for interest rate hikes are increasing as the market begins to turn around.  So even if prices continue to decline a bit, if interest rates increase it basically cancels out the net profit you would realize from waiting.  I believe that now is a good time to buy based on these factors.

There are still a lot of foreclosure properties (REO’s, short sales, pre-foreclosures) on the market applying pressure, but as this inventory is reduced prices will get back to a fair market value based on supply and demand.  In our area (Danville, Alamo and the 680 corridor from Pleasanton to Walnut Creek) it continues to be a highly attractive area to live in, with a localized economy that remains strong.  However, even in some of the outlying areas such as Brentwood which has seen a 33% drop in median home prices compared to our 10-14% drop, we are seeing more buying activity and even multiple offers on properties that are priced right.

There are currently 3,692 properties on the East Bay MLS system that reference REO’s, Short Sales and pre-foreclosures.  When I look in the 680 corridor from Martinez to the north and Pleasanton/Livermore to the south, there are currently 401 listings referencing REO’s, Short Sales and pre-foreclosures.

If are interested in investment properties, REOs, or foreclosures, contact Craig – (925) 984–4910