Flat news at the USD Residential Real Estate Conference

We attended this years 12th Annual Residential Real Estate Conference at the University of San Diego and here is a quick summary of the event.

For both California and San Diego, the forecasts for 2012 are predicting only a slight decrease in the number of distressed homes and flat prices due to

  • Low consumer confidence
  • Tough credit qualifications 
  • Lack of hiring by employers. 

We are not yet at a long term equilibrium in home ownership rates and many more “strategic” defaults are in the pipeline for the banks & a higher % of distressed inventory is selling as short sales vs. REO. This strategy is helping banks minimize their losses and are processing the short sales in half the time.

 

At GII We can attest to all of this through our deals. It appears that not only will our single-family renovate and sell strategy fit the market conditions in 2012 it may be time to start buying and holding more properties.

 

Highlights from Fannie Mae chief economist Doug Duncan, PhD:

 

  • New housing starts at long term rate for household formation by 2015
  • 20% of us home values are underwater
  • 0% growth in small business hiring in 2012
  • 1.6% growth in US GDP in 2012
  • Gdp is at prerecession levels but employment has not recovered and will remain at same level through 2012
  • 75% of americans think economy is headed in wrong direction
  • Reaching levels of historical % of ownership and rental properties
  • Long term home ownership level expected to be 65%

Highlights from USD Assistant Professor Ryan Ratcliff, PhD:

 

  • 12% unemployment rate in CA
  • SD nonfarm unemployment increased 7% and has only declined 3%
  • CA average resale home price down 5% year over year
  • SD resale prices have only declined slightly year over year
  • $100-300k is the price range of most distressed sales in 2011 in San Diego
  • Best CA employment gains were in high tech and business services, worst sectors were manufacturing and construction.

Highlights from USD Associate Professor Alan Gin, PhD:

 

  • Best SD employment gains were in health care services, admin. and support services, real estate and hospitality (theme parks)
  • SD gained 24k jobs in 2011
  • SD unemployment rate dipped just below 10%
  • Gin’s local consumer confidence indicator is down 2% in SD
  • Job growth in SD expected to be 15-20k in 2012
  • 5k home and multifamily units authorized in 2011 – up from 3k in 2009 and 3.5k in 2010
  • 2.5k of the 5k in 2011 were multifamily (comprised mostly from a couple big projects – this is up 128% from last year

Burnham-Moores Center Presentation Slides

Presentations from the 12th Annual Residential Real Estate Conference,
December 13, 2011:

 

 

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GABHART INVESTMENTS COMPLETES MULTI-PROPERTY FUND AND RETURNS 24% ANNUALIZED TO INVESTORS

For Immediate Release

SAN DIEGO, Release Date – Gabhart Investments Inc. sold the last property in its first micro fund, Gabhart Real Estate Opportunity Fund Series 1, LLC. The fund was invested in the purchase, rehabilitation and sale of multiple single-family homes over a 13-month period.

The homes were located throughout San Diego County with resale prices ranging from $250,000 to $500,000. All of the properties were bank-owned or short sale purchases with rehabilitation costs ranging from $30,000 to $100,000.

 

Gabhart Investments is currently managing three active funds focused entirely on 1-4 unit residential properties. “Our strategy with the funds is to minimize risk for our investors by purchasing multiple properties in each fund located in different sub-markets throughout Southern California. Investors benefit from an average of profits from several projects and they are also insulated from a lapse in one sub-market”, says Curtis Gabhart, CEO.

 

The investor partners in Fund 1 achieved a 22% to 26% (24% average) annual internal rate of return on their capital depending on their investment date. One of the many unique features of the fund is that as each property sells, investors receive a portion of their capital allocated to that project along with estimated profits. “This structure is attractive to our investor partners as it provides short-term cash flow and allows them to reinvest back into another fund or invest elsewhere,” says Nick Walsh, investment manager.

 

Gabhart Investments is currently partnering with multiple investors in their Series 5 fund. “We’re interested in working with partners that understand our current business plan and share our longer-term goal of expanding into new markets and investments. For example, we are in the process of creating a new fund to invest in first trust deeds within our niche market to provide investors with monthly cash flow and an alternative to our equity partnerships,” says Gabhart.

About Gabhart Investments Inc.
Gabhart Investments Inc., headquartered in San Diego, Calif., is a real estate investment and advisory firm specializing in the fundraising of micro funds for the investments of distressed single & multi-family residences in Southern California. www.gabhartinvestments.com

 

 

 

***The information within this site does not constitute an offer to sell or a solicitation of an offer to buy any securities. Financial results are un-audited company estimates only and are not necessarily indicative of future results which may vary substantially from those set forth herein.

 

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Transitioning to Commercial Real Estate

Transitioning to Commercial Real Estate

 

This year I have been invited to present a  morning and afternoon class for the San Diego Association of Realtor s annual real estate expo.

SDAR is hosting it so there is no cost (sdar charged $45 for this class when I taught in their offices last year) but I will be up-selling ginzu knives and snuggies

What do you get the dad who has everything for Christmas? A superman Snuggie

What do you get the dad who has everything for Christmas? A superman Snuggie

at the end of the presentation. Nothing like having snuggies for the whole family as long as yours is of Superman!

 

Just kidding. Any of you who have been to these courses know I don’t sell anything except……. the fact I am a buyer and that providing you with tools I have learned and used you’ll consider calling Gabhart Investments when you have a great property for sale.

Ok here is the sch-peel

In this class you will learn if the highly lucrative, highly competitive business of commercial real estate brokerage is right for you. This business niche is not for everyone, so attend this class and find out if you are up to the challenge.

Commercial Real Estate Course topics

  • What is commercial real estate?

  • Market outlook

  • How long will it be before I make money?

  • What are the risks?

  • Do I need experience in commercial real estate?

  • How to leverage your existing client base to turbo charge your success

  • Choosing the right company to work for

  • Additional resources to get more information on commercial real estate

  • Here is what we are not covering

  • How to analyze a property (I will talk about what you may want to know/learn and where to get that information)

  • This is a good intro if you are thinking about making a time or money investment into the commercial side of things.

It’s not for everyone so don’t expect a bunch of ra ra sis boom ba that anyone can get rich doing it. I will give you a no nonsense run down of the business as I have experienced it.

I will say that if there is a way to get into Real Estate with little or no money (not little or no time) then commercial real estate may be a great avenue. This is what allowed me to transition from doing Real Estate as a hobby to a career that has been very rewarding (and challenging – NO GET RICH QUICK GRASS HOPPAH)

 

I will say

Real Estate gives me flexible hours (not short hours but time availability to do things like see my kids plays at school during the day etc.)

And work from my H2Office while not in my physical office. Check out this awesome set up.

Real Estate gives you the flexibility to work from anywhere!

Real Estate gives you the flexibility to work from anywhere! My second home office...

 

 

 

 

 

 

 

 

 

This Friday at the Town & Country Resort in San Diego
http://www.sdarexpo.com/html/exhibitorOpp/Breakout.html
10:00 a.m. – 11:15 a.m & 2:45 p.m. – 4:00 p.m

 

Also don’t forget to follow our real estate adventures by going to our individual property websites…….

For the most updated information & news on real estate & Gabhart Investments go to our facebook & twitter pages

ps. click here to like us on facebook

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That San Diego is so hot right now!

That San Diego is so hot right now!

University of Nevada may have beat Boise State’s football team, but noone is laughing about either town’s real estate market. Meanwhile, San Diego is on the move and getting recognition as one of the healthiest residential markets in the country. Mortgage interest rates and home prices are starting to rise, so we’re likely to see more buyers enter the market that want a quality turn-key home with appreciation potential. 

For the most updated information & news on real estate & Gabhart Investments go to our facebook & twitter pages

ps. click here to like us on facebook

 & Here to follow us on twitter