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How Interest Rates Affect Real Estate, The Age of Inflation

Friday, July 19, 2013 | 0 Comments

How Interest Rates Affect Real Estate, The Age of Inflation

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us

Interest Rate Surge Ready To Crash Real Estate Market?

Wednesday, June 26, 2013 | 0 Comments

Pretty Compelling title. Some investors believe it. Here are my thoughts in three simple words: “It won’t happen.”

First let me stress again that the current real estate market, like pretty much every market out there is totally manipulated. It is not a real recovery. When a central bank reduces rates to historic lows and buys mortgage backed securities at the tune of $85 Billion of a month, you create bubbles. Not to mention a government running deficits at roughly 10% of GPD. These actions create boom and bust cycles that have become typical in America since the creation of the Federal Reserve in 1913.

So in the last month the 10 year Treasury has gone up close to one point. Historically, and under normal free market principles, rate increases are bad for real estate values. However, we are not living in normal free markets. For those who have watched my past commentary and documentary we are living through a major market pump and dump. See here and here for more on this.

In short we are at the end of the road for multiple bubbles which include the stock market, bonds, the U.S. dollar, student loans, Pension funds, and the real estate market. Whew, that’s a lot of bubbles. The Federal Reserve knows this as does the major banks that own the private for profit central bank. Because of this the Federal Reserve has two options. Continue to pump the market with cheap money or taper and watch the bursting of bubbles begin.

Check out this video for more on this topic

House of Cards: Real Estate’s Big Secret

For more on prospering in the real estate market during these economic times check out:
www.resourcefulrealestateacademy.com

Fabian Calvo: Housing Market Rife With Risks And Opportunities

Friday, June 14, 2013 | 0 Comments

Check out my interview with Phil Hall of MortgageOrb.com where I discuss the role of The Federal Reserve, large financial institutions, government agencies and the media in the housing market and my forecast for the housing market and the U.S. economy in the near-future.
Fabian Calvo: Housing Market Rife With Risks And Opportunities

Real Estate Bubble 2013-2016

Monday, May 13, 2013 | 0 Comments

Real Estate Bubble 2013-2016

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us

Quantitative Easing and the Real Estate Market

Tuesday, April 30, 2013 | 0 Comments

What does Quantitative Easing have to do with Real Estate Markets? EVERYTHING!

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us

The One Thing

Thursday, April 18, 2013 | 0 Comments

What’s the one thing that all investors need to know regardless of what asset class you invest in, real estate, stocks, gold,etc?

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us

BUSTED! 7 Myths About Real Estate Investing

Friday, April 5, 2013 | 0 Comments

Fabian Calvo busts 7 myths about real estate investing.

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us

The 21st Century Pump and Dump

Tuesday, March 5, 2013 | 0 Comments

We usually think of pump and dump scams when we think of penny stocks, or I guess stocks in general. I remember a few years ago The National Inflation Association came under heat from precious metals expert and investor Peter Schiff over what he claimed was the pumping up and later dumping of penny stocks. The way a pump and dump works is pretty simple. Investors pick a stock and buy it at a very inexpensive price. Later using a variety of methods like a PR campaign, or advising their newsletter subscribers or investors to buy the stock telling while them it is the next Apple Computers or Google, they pump the price up. So the first guys in buy very low, they then use media and influence to have others start buying, and once they create a huge story around the stock and pump the price up they dump, meaning they sell. The last people who buy in are the ones that get crushed. Although this seems like a scam more related to stocks, it is my personal opinion and theory that it is happening right now in the U.S. real estate market.

Just think about my description about what a pump and dump really is. Doesn’t it sound all too familiar to what happened in the housing boom and then bust just about 5 years ago? And although it sounds similar to a pump and dump the last housing bubble I think was more organic in nature. What I mean is that the last housing bubble was caused because of government policies, Federal Reserve policies, and lastly big bank policies. These three players created the boom, and then created the bust. Of course the punch drunk investors and first time home buyers, and everyone else who used their real estate like an ATM, was to blame for the bust as well. At the end of the day it does come down to personal responsibility, doesn’t it?

I think the real estate market today has all the signs of a pump and dump. And this isn’t just a stock; this is the entire U.S. housing market! Sound crazy? Well some of our so called government leaders and some of the ego maniacs over the Federal Reserve and big banks are more than willing to move forward with a pump and dump of this scale. This is Enron, only a TRILLION times worse.

So why do I think there is a pump and dump underway? Well, let me present my theory. For starters we have multibillion dollar financial institutions and investors that usually have not been real estate investors jumping into the market in a BIG way. Take for example John Paulson, who runs one of the largest hedge funds in the world. Not only did he move almost half of his position into gold, over the last year he has purchased over 25,000 single family residential lots in California and Colorado. Warren Buffet is another very well connected investor who last August revealed he is investing big into the U.S. real estate market. News of this was blaring all over the media and was used as a sign that the housing market was now healing. But wait, what about the trillions still out there in toxic debt? Forget about it. IT’S HEALING! Blackstone group is another big firm that in the last year has purchased over two billion dollars’ worth of residential homes in markets like Tampa and Atlanta. These are just a few of the firms that come to mind. As someone who is an active investor in many metro markets across the country, I can tell you that the BIG money is pouring into real estate.

Now, what does all this money have in common, or at least most of it? Well, many of the players that run these firms have deep connections at the big banks and Federal Reserve. Perhaps they know what you and I already know which is that the Federal Reserve CANNOT raise interest in this climate. If it does that, the housing market would suffer as would the overall economy. After all, this is an economy that is fueled by cheap money and credit, the tell-tale signs of an end road scenario. So big money investors with contacts at the FED that haven’t historically been real estate investors are getting into the market big time. That alone doesn’t really send my spider sense into overload but it doesn’t just end there.

The Federal Reserve is doing everything they can to raise home prices. Not only are they keeping interest rates artificially low, they are also buying over forty billion dollars’ worth of mortgage backed securities. Between you and me, I think the number is MUCH larger and the FED is likely buying MBS from European banks as well who have yet to recapitalize their banks. Bernanke already revealed in past congressional testimony that he was helping bail out European banks. To think it is still not underway is simply not dealing with reality. Remember, this is the same guy who promised, and claimed under oath before congress, that he would never monetize the debt. Liar, Liar pants on fire. The FED is clearly pulling out all the stops to create another housing bubble as is the Federal Government. Last year they purchased over 95% of all newly originated loans. In addition, FHA in the last year has started up the low down payment loans, and in my opinion they will likely really kick start no money down loans after the midterm elections.

However, before the FEDs pour gas on the fire and really create another housing boom, they need the help from two more players. Big banks and the media. Big banks are clearly suppressing inventory from the market. Again, as someone who is on the front lines of this market I have seen firsthand big banks holding back inventory and even suspending foreclosures. Because U.S. banks still have trillions of dollars in toxic loans on their books, they need to do everything they can to raise the price of real estate. If they had to mark to market their assets today many more banks would go bankrupt. Technically these Zombie banks are already bankrupt. However, because of the cheap lines of credit and bailouts from the FED’s they are able to remain open for business.

The last culprit is the media. No longer the watchdog, they have become the lapdog of the establishment. Promoting whatever lies and propaganda the government or big banks tell them. Case in point is the so called housing recovery. Are asset prices going up? Yes. Are foreclosures going down somewhat? Yes. However what they fail to tell you is that the main driver of this is the manipulation at the hands of the big banks, the Federal Reserve, and the big money financial institutions. I have yet to hear someone on T.V. or radio, except for me that is, inform the public that in many major metro markets 50% to 70% of all sales are from cash investors. Many of them big financial institutions. So the media is doing their job to promote real estate and prop up prices that helps the overall pump and dump.

So to recap, we have the Federal Reserve propping up prices and providing a life line to big banks so they don’t go broke. We have the big money investors pouring money into these markets. We have the federal government starting up the low equity down payment loans. And lastly we have the media promoting the “Real Estate Revival”.

In my opinion this is a HUGE pump and dump rather than the free market dictating the rise and fall of asset prices as well how the capital flows into the market. What all these institutions know is the following. Buy all the real estate you can now, hold the real estate for about 36 to 48 months while banks and the feds starting handing out no money down loans like candy and the novice investors that do not understand the drivers of real estate start playing Donald Trump again. Once prices are pumped to levels that resemble 2006-2007 these big players will start to dump homes and properties onto the unsuspecting shoe shine boy. Pretty brilliant plan, isn’t it? I mean Dr. Evil couldn’t come up with this. Not only will this allow these players to make a boat load of money it will also allow U.S. banks to sell their toxic debt into a market that is appreciating in price meaning the hit to their balance sheet will be minimal. In fact it will probably result in a profit.

What can the average investor do? I often tell my coaching clients and regular clients that knowing these circumstances means I have changed my time horizons. The investor that tells you they are holding long term usually doesn’t understand the business cycle or financial markets. I suggest you hold for a short time frame, 12 to 36, maybe 48 months. Getting in and out of deals is best and that is exactly what my firm does almost daily. This pump and dump will be HUGE and it also spells a HUGE opportunity for the educated investor.

If you are interested in learning more about the real estate markets and how you can tap into what I call the trillion dollar opportunity check out www.resourcefulrealestateacademy.com

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us

The Important Question On Real Estate Investing

Monday, February 25, 2013 | 0 Comments

Last night I lay awake recalling the time I first started investing in real estate years ago. It led me to a very important question anyone interested in this industry should ask, “How can someone make money investing in real estate from anywhere in the world?”
There is an easy, simple rule. With it in front of him, not even a child could go wrong. Just ask yourself one question. If your answer is “NO,” you are on the wrong track, and you will never make much progress, until you get off it and on the right track.
If your answer is “YES,” then you are walking in the right direction and you have only to keep it up to attain any goal you set in this industry.
That question and a few others are the basis of the lessons learned in my new course “The Resourceful Real Estate Academy.” If you are looking for a road map to guide you through the process of making money from anywhere in the world in most real estate markets in the world then order today at www.resourcefulrealestateacademy.com

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us

United States on Sale?

Monday, February 25, 2013 | 0 Comments

Foreign investor demand of U.S. real estate is on fire for many reasons. One of the first is the weakness of the U.S. dollar. Foreign buyers are able to invest in US real estate that will produce high yields as well as make money on the currency trade. These two factors can produce a double whammy effect of great returns. Since 2006 property values in America have declined in many markets around 70%. Because of the manipulation tactics of the Federal Reserve, Bernanke’s QE to infinity, to big banks suppressing inventory, real estate prices are starting to rebound. These are some of the reasons foreign capital is making its way to America.

International buyers accounted for $82.5 billion, or 8.9%, of the $928 billion spent on residential real estate in the 12-month period that ended in March 2012 according to a survey released by the National Association of Realtors last year. That was up 24% from $66.4 billion in the previous-year period.

The survey showed that about 55% of all international buyers came from five countries: Canada, China, Mexico, India and the United Kingdom. Additionally, five states accounted for around 55% of all sales to international buyers: Florida, California, Texas, Arizona, and New York. The survey found that 62% of international buyers paid in cash. In fact, in some markets cash buyers account for up to 50% of all sales and in some Florida markets over 70% of sales are cash investors. Real first time home buyers are having a tough time competing with these cash investors and many times lose out when their contract contains a financing contingency.

In addition to the buyers from the countries mentioned above, if we see problems begin to flare up again in Europe, which we will, many wealthy Europeans will start moving their money to America in an attempt to protect their wealth. Unfortunately for them they will likely soon find out that the politicians in America are just as crazy and stupid as the ones in Europe.

Another force driving the market and buying everything from oil fields to hotels are Chinese investors. Chinese investors accounted for $7.4 billion of sales in the 12 months ending in March 2012, up 24% from the previous 12 months, according to the National Association of Realtors. Buyers from China and Hong Kong also spent $1.71 billion on commercial property in the U.S. in 2011, more than quadruple their investment in 2008, says Real Capital Analytics.

All this foreign money presents a HUGE opportunity for investors. My company The Note House has made it a priority to make sure we are the point of contact for as many of these foreign buyers as possible. Many of them are looking for value, and the majority has educated themselves about the markets they seek to invest in. If you become that point of contact that can present deals to these investors you will be highly coveted among this group.

One caution I would stress to all foreign buyers and really all current investors. I am forecasting that prices will continue to increase over the next 24 to 48 months perhaps even longer. Market manipulation can create a joy and exuberance that leads to bad investment decisions like we had during the last boom years. Here is what the big money investors don’t want you to know about. Wall Street investors and hedge funds are buying billions of dollars worth of properties right now and waiting for inflation to increase prices. They also know that the U.S. government is starting “no money down” loans again for many buyers and will likely increase these programs which will fuel high purchases prices. Once all these factors take hold, the big money investors will sell into this market and the shoe shine boy who is buying his first rental property or home will likely get stuck holding the bag. The bottom line is that you should always know what drives a market. Look for changes in those driving factors and plan accordingly. There is tremendous opportunity and money to be in made real estate right now, you just have to know what you are doing.

The Note House LLC is a premiere nationally recognized purchaser of commercial and residential mortgage notes and REOs. Dedicated to simplifying the process of complex real estate transactions, The Note House team relies on in-depth market research and its combined experiences to ensure that each transaction is streamlined resulting in a win-win for all parties involved. For more information, visit: www.thenotehouse.us