Investor Report: The Basic Principles in Gulfport-Biloxi, Mississippi

There are no sure bets in real estate investing. Everybody knows that, but there are some basic principles that almost always work well.

For example, when most of the market is down or flat, look for counter-cyclical local "niche" markets that are at the very early stages of significant economic and population growth, and where land prices are relatively low.

One such area right now that's beginning to attract serious attention is Gulfport-Biloxi, Mississippi.

You may recall that it popped up out of nowhere in the latest quarterly federal home price survey numbers because average values there in the past year jumped by 6 percent, while much of the country was looking at negative numbers.

Well, it turns out there's something significant going in the Gulfport-Biloxi area two years after Hurricane Katrina -- namely economic growth powered by federal and state "Gulf Zone" investment and tax incentives, a major rebound in the casino industry, plus employment expansions at nearby military and NASA space research facilities.

Governor Haley Barbour says there's a need for at least 100,000 new, moderate cost houses in the area right now -- and as many as 300,000 over the next three to five years. And the good news for investors is that, despite the fact that the area now supports the second largest casino industry in the U.S. -- it's bigger than Atlantic City and second only to Vegas -- real estate is still cheap.

For example, you can buy a new 3 bedroom, 2 bath, 1,350 square feet home on a small lot in Bayside Park for $125,000, according to Michael Eadie of Gulfstream Realty and Development. As rentals aimed at the growing local workforce -- or even families finally getting out of their FEMA trailers -- Eadie says properties like these turn positive cash flows, qualify for special federal tax breaks, and have excellent long-term capital appreciation potentials.

Again, nothing is guaranteed in real estate. But the rebounding Mississippi Gulf Coast is definitely worth a close look.

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source: realtytimes.com

FTC Loses A Round In MLS Witch Hunt

A Detroit-area MLS's decision to stand and fight the FTC has paid off big time.

The Federal Trade Commission filed a complaint last year against RealComp II, Ltd, claiming the broker-owned MLS promoted anti-competitive policies with regard to the posting of MLS listings to the public.

Seems RealComp only wanted to publish listings provided by brokers that employ other brokers, not listings in which the seller would represent himself or refuse to pay cooperating brokers.

This little trick is designed to get buyers to contact the seller directly, and skip paying their broker. Realcomp didn't prevent these MLS-only brokers from joining the MLS, only from putting their listings on MLS public marketplace feeds like Realtor.com.

Since the MLS was designed to facilitate cooperation between brokers on both sides of the transaction, it's understandable that some brokers wouldn't like MLS-only brokers sneaking FSBOs into their public listings feeds.

Chief Administrative Judge (ALJ) Stephen J. McGuire dismissed the FTC's complaint on the basis that the FTC didn't prove its case.

While he agreed that "Complaint Counsel 'has made a prima facie showing as to the anticompetitive nature of the alleged restraints,' the ALJ ruled that with "respect to Realcomp's Search Function Policy," the "Complaint Counsel had not shown that the nature of the alleged restraint was anticompetitive or unduly hindered consumer choice."

In other words, no competitors were hurt and no consumers were hurt. Next case.

But before anyone breaks out the champagne, here's a little footnote. When McGuire has ruled against the FTC before, he's been overturned. Why? The next step is an appeal.

The FTC can actually review its own case and make its own ruling.

Is this a great country or what?

But the David-Goliath battle isn't over yet. The FTC also filed against other MLSs and associations. Five have "settled" with the FTC, but any MLSs remaining should stand and fight.

Hear that, NAR?

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source: realtytimes.com

Interest Rate Update

Today's Interest Rates from Realty Times are based on a 30 year amortization rate, with good credit and no origination fees.

Rates are currently the same -- with no major economic news today to report, mortgage rates are stable.

6.125% 0 Points
Stable

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source: realtytimes.com

Real Estate Marketing Strategies: How You Can Survive and Thrive This Holiday Season!

Do you go through the same slump every year? It begins somewhere in November. Your business slacks and you realize that your income is going to come way down at the very time when you want to be spending and buying. You get sad and then you get scared and before you know it, you're in a full blown depression. Somehow the thought, "Desperation doesn't sell" finds a way into your already crowded brain. How can you turn this around, or better yet, nip it in the bud? Here is a way to survive, even thrive this Holiday Season:

Think outside the box:

Here's an example:

It's Tuesday afternoon and I'm giving a coaching session to one of my clients, Sandy. I ask her how she is doing and she admits to not only being nervous about money but being downright panicked. Her fear was real. She wasn't even sure how she was going to cover her rent in January.

Sandy is a new real estate agent and had planned to have some escrows to get her through the holidays which never materialized. When I questioned her on marketing strategies she said, "I really think I'm doing everything I can do."

The voice of fear:

When we dialogued with the nervous, scared part of her, we found out some useful information. Basically this was a very practical part of her. It wanted bottom line results. Nothing vague would do. It said loud and clear, "Show me the money!"

Now Sandy had something valuable to work with -- the only solution to calming down her fear was to manifest money and do it quickly.

She looked at me, stumped. "I'm using every real estate strategy that I know and I'm getting desperate." So I asked her what other skills, talents and abilities she had. "Well, I used to do waitressing in the past." So I asked her about doing that temporarily to get her through the slump. "Oh, I can't possibility do that, because everyone in my town would see me and think I was a failure in real estate." When I suggested that she find work out of her immediate vicinity she remembered she had some restaurant connections in a nearby city.

Transforming fear into action:

Her mood lightened and the worried expression changed to a smile. "Yeah, maybe I can do that but how do I keep from feeling like I've failed at my major career?" So I asked her, "How many actors and actresses do you think waited tables in Hollywood before becoming famous?" We put our heads together and figured more than 80 percent.

So I said, "What if they looked at their waiter or waitress job and labeled themselves as failures because they had to do so called menial work to survive?" Sandy carefully considered what I said and decided that she would adopt the same attitude. Further she decided that this meant she really was successful because she was committed to success. She was willing to do whatever it took to succeed in her chosen career.

Look for immediate feedback:

When our session ended, Sandy was looking quite pleased with herself and I knew she was on the right track. What I wasn't expecting was immediate feedback. She called me about 10 minutes after the session, and very excitedly told me, "I did it, I called my restaurant connections and I already have 3 jobs at 3 parties. They all sound like a blast! The last one is a masquerade party and I'm really looking forward to it."

She proved my point, you can always turn fear into action. Furthermore, if you focus on what gives you joy, you'll find a way to get paid for what you love to do.

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source: realtytimes.com

New IRS Website Section Provides Information for Those Facing Foreclosure

The IRS wants to help you. Really. Well, maybe not you, yourself, exactly; but anyone who knows or thinks they may be facing foreclosure. And that is a fair amount of people.

On September 17, the Internal Revenue Service added a new section to its website. In addition to explaining the potential tax consequences of mortgage workouts and foreclosures, the section also informs taxpayers of "special relief provisions [that] can often reduce or eliminate the tax bite for financially strapped borrowers who lose their homes."

According to the IRS news release, "The new section of IRS.gov includes a variety of information, including a worksheet designed to help borrowers determine whether any of the foreclosure-related relief provisions apply to them. For those taxpayers who find they owe additional tax, it also includes a form they can use to request a payment agreement with the IRS. In some cases eligible taxpayers may qualify to settle their tax debt for less than the full amount due using an offer-in-compromise." It kind of sounds like one of those real estate ads that names a selling price, but adds that "seller is flexible."

The presence of this addition to the IRS website is certainly a good thing, and one hopes that it will receive more notice than it has so far. It is well known that an outbreak of foreclosures is among the chief unhappy consequences of the irrational lending policies of the past few years. What is less known, especially among those who are being foreclosed upon, is that there may also be negative tax consequences to the homeowner. As the IRS site states it, "Under the tax law, if the debt wiped out through the foreclosure exceeds the value of the property, the difference is normally taxable income."

The emphasis needs to be on "normally." It is not always the case that debt relief is taxable; and this is something that the IRS site takes pains to point out. In doing so, the section addresses not only those who didn't know about the possible tax consequences of debt relief, but also it provides important information for those who might have mistakenly believed that a foreclosure would result in tax obligations for them.

The section discusses different situations when cancellation of debt does not result in taxable income. An important situation is when the debt is in the form of a non-recourse loan. "A non-recourse loan is a loan for which the lender's only remedy in case of default is to repossess the property being financed or used as collateral. That is, the lender cannot pursue you personally in case of default. Forgiveness of a non-recourse loan resulting from foreclosure does not result in cancellation of debt income."

That's the good news. Unfortunately, there still may be other tax consequences when a non-recourse loan is wiped out as a result of foreclosure. That will depend on the particular situation.

A particularly helpful aspect of the new website section is that it includes worksheets and examples. Moreover, it provides links to other IRS publications that also offer worksheets and examples. There is also a link to the form 1099-C, which is the form used for reporting debt cancellation. This is the form from which the IRS gets its information, and taxpayers who receive one need to know that they should verify its accuracy.

It has certainly not been the point of this discussion to summarize the information that is now available on the IRS website. Rather, it has been to make readers aware that this information is available, and that it is something that should be seen by anyone who is facing or contemplating foreclosure.

Real Estate Designers offers totally innovative solutions for your software development, Internet programming, real estate web design and hosting needs. Our service includes domain name registration and real estate web design. Real Estate Designers provides the complete solution including design, application development and marketing.

source: realtytimes.com