The Flip Board

Crye-Leike Realtors is the nation’s fourth largest real estate firm. It has 1,100 agents in the Memphis, TN area with its largest offices in Memphis and Nashville. Today, Crye-Leike announced its sales numbers across the eight states the company operates within. 

$4.2 Billion in sales from 25,871 property closings. This is for the one year period, 2007-2008.  Grant it, this is about 26 percent down from the previous year. But the point is, one company closed over twenty-five thousand pieces of real estate, both residential and commercial.  Do you think you can buy, sell or rent 20 to 50?  I think you can. I believe in you.

Professional property managers are experts in the field acquiring and keeping paying tenants for real estate investors. They are knowledgeable about the local rental market, vacancy levels, and rental price trends. But most of all, the property manager you use for your real estate business should excel in leasing and managing rental property.

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HSBC has done well to style itself the great subprime survivor. But the world’s biggest bank is less special than it thinks. True, its shares have outperformed almost every banking index around. And its core tier one capital ratio – 7.8 per cent at the end of September, towards the top of its target range – is on the high side, versus western peers.

But as HSBC has three-quarters of its loan book in the benighted US and UK, that target may be a moving one. A note to third-quarter accounts shows that the carrying value of US consumer loans was $111bn, but that the market value was $34bn lower. Fine: these are banking assets, not held for trading, so the group does not have to account for them at fair value. But if you were to tot up HSBC’s subprime losses taken so far through its P&L, then add the reported fair-value deficits not recognised on balance sheet, the sum would be almost $70bn – higher than Merrill, Citi or UBS, and second only to Wachovia. An accounting confection, of course, but it does throw a light on the scale of HSBC’s exposure to US subprime and the potential for further impairments.

- Lex - www.TheFlipBoard.com

I just read an article earlier today that really puts into perspective exactly what the mortgage collapse was all about. Check it out here.

The mess has gotten so complicated and convoluted that it has affected banks, savings & loans and other such institutions worldwide. As we move forward and keep our eyes focused on better days ahead, let us not forget the behaviors that led us into this mess in the first place. For if we forget our past, we are doomed to repeat it.

-Richard - www.TheFlipBoard.com

A market analyst from Wachovia Bank said yesterday that he feels real estate is about to hit the bottom. I agree and disagree at the same time. Yes, some specific niches of real estate may bottom out, but some still have a good way to go.

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2008 is now history.  2009 promises to bring us all new challenges and opportunities for excitement.

From all of us here at The Flip Board…

Hypo Real Estate, a German commercial property lender has been rescued for a second time by the German government two months ago. The company will also slash more than 40 percent of its workforce and pull back from some business areas to keep from completely going under.

Staff numbers would fall from 1,800 to 1,000 in the next three years, HRE announced this last weekend. Strangely enough, some two-thirds of the jobs being lost are outside of Germany. At the same time, the Munich-based corporation warned that business conditions had declined in the current quarter and “significant extra burdens” were expected in its fourth-quarter results. It was also terminating the contracts of Markus Fell, Finance Chief, and Frank Lamby, responsible for all commercial real estate operations.

HRE attracted global attention in October, at the height of the financial market crisis, when it received a €50bn ($70bn) funding package, orchestrated by Berlin, after a €35bn lifeline proved inadequate. This is the same predicament large US banks find themselves in.

HRE had run into difficulties after failing to obtain sufficient short-term, unsecured financing to support its public sector lending arm. The company has been among the German financial institutions hardest hit by the financial turmoil because of its reliance on wholesale funding markets.

For the uninitiated, a real estate broker is one (or a firm) who acts as mediator between sellers and buyers of real estate.  They also market and put together deals.  Hmm… If you are a good RE Broker, then chances are you are very affleunt and handle very exclusive accounts.

Or, you are a newbie who is trying to break into the real estate market by not actually purchasing any real estate.

It sounds to me that brokers do nothing outside of what an experienced RE investor can do on their own. So, why do we have brokers? When real estate companies wish to capitalize on fees and “add-ons”, they come up with things like brokerage, handling services and negotiation representation. All things that you will be charged for.  And all things you can do yourself for nothing.

In this particular real estate market, we have a large supply and a lower demand, which is causing prices to drop. This also means brokers are out of work.  Some brokers are trying to move devalued real estate. And some are trying to convince buyers to buy.  Bottom line is without buyers and sellers and enough cash to support both, you have no real estate brokerage business.

Save some money and handle real estate yourself. Keep as many transactions in-house as possible. This includes locating properties, negotiating deals and representing yourself and/or company.

Let the brokers move their businesses to insurance.

-Richard - www.TheFlipBoard.com

Merry Christmas!

First, the bad news -

The nation’s labor market continued to worsen in recent weeks, with the unemployment lines stretching to the longest in 26 years, the Labor Department reported this morning.  First-time applications for state unemployment benefits jumped by 30,000 to a seasonally adjusted 586,000 in the week ended Dec. 20, the government said, based on reports of actual filings at state offices around the nation. That’s the highest since November 1982!

Next, better news -