Florida Strategic Opportunity Fund, LLC Helping to Relieve the Housing Crisis

1090 Kapp Avenue, •Clearwater, FL 33765 (727) 237-0075

The Problem

As real estate professionals, we all know that the outlook for single-family homes is bad. All the experts seem to agree that prices will decline. There are several factors that create this expectation:

Mortgage interest rates have just risen and may rise further.  As more money is paid in interest, less money is there to buy a house.

A recession will lower incomes and leave less money to buy houses.

Despite government intervention, a large amount of foreclosures will continue to pressure market prices.

Many speculators, especially in Florida, who bought houses at high prices a few years ago, can no longer afford to keep them and must sell.

It is hard to get mortgage credit. Banks are only giving mortgages to the best borrowers.

Therefore, the outlook for home prices is bad. The expectation that home prices will decline causes fewer people to buy and so reduces demand, further reducing prices.

We know of other factors that will negatively influence prices that these experts do not mention.

First, some investors with large portfolios of homes are being forced to sell as their banks or lenders refuse ask these investors to reduce their loans. Many speculative purchases of homes were financed not by 30-year mortgages but by two-year loans. As these loans come due, the lenders, whether they are banks, or so-call “hard money” lenders want the money back.

Second, some investors have defaulted leaving the hard money lenders with real estate they never wanted to have. These lenders must sell.

Third, the demand for houses is being reduced by the number of families that are doubling up and sharing houses with others. Two families will now share a house to reduce costs.

Fourth, banks are selling real estate they own at bargain basement prices. Banks have a record amount of real estate owned because of foreclosures. Banks are not in the real estate business and want to sell. They can only find ready buyers at low prices and must take large discounts. These low prices further pressure the market.

It Is So Bad, It’s Good

As a little reflection will tell you, what these factors add up to is that there are many houses on the market and it is easy to buy houses at a discount.

We specialize in assisting distressed sellers that must sell immediately. We will make them a fair, firm, cash offer fast. We price our purchases to reflect any risk there might be in price declines.

The worse the market is, the better for us. As we all know, this is a buyer’s market. We are one of the few buyers left.

What is Overlooked

By focusing on the current crisis, what the experts also overlook is the future. The more you look at our market, the Tampa Bay area, the more it is easy to realize that the long-term outlook is strong.

Tampa is one of the more affordable places to live. KPMG rates Tampa Bay the 3rd most affordable place to do business over 27 U.S. metro markets. As you can easily imagine, many consider our quality of life, living in Florida and being hear the ocean and Orlando, is highly desirable.

What many do not remember about Florida is that many baby boomers will move here to retire. The expected increase in population in Florida from this migration is expected to equal the current population of Pennsylvania. 

The added advantage for the housing market is that most of these baby boomers can afford houses.

Further, those people who lose their homes in foreclosure do not stop needing housing. They are used to living in houses and want to live in a new house. Generally, they can afford to rent a smaller house. If they can rebuild their credit, they can qualify for a mortgage and buy that house in a year or two.

In fact, our credit reconstruction expert has a 90% success rate in assisting clients to rebuild their credit and get a mortgage. 

This allows us to buy homes at bargain prices and rent them, giving the tenant the option to buy the home and assist him to rebuild his credit.

This is the way we are helping the home market and we are helping homebuyers. We can provide an affordable house while the homebuyer rebuilds.

Despite the bad market for home prices, there are many who want to buy. We know from the response we get when we advertise homes for those with poor credit. In one county alone, there were 1,000 foreclosures in the first three months of 2008. These people need to live somewhere but they have bad credit and cannot get a mortgage. We may be able to help them.

Our System

 Our Chairman, Roger Taylor, is the local owner of the Homevestors franchise. We know you have seen their billboards and advertisements: 

(That is not Roger on the billboard.)

Homevestors buys as many as 6,000 houses every year nationwide. We use this proven system

Roger has an outstanding track record in buying, selling and renting houses in a down market. We know that that a down market is good for those who buy homes. We have proven we know how to rent and resell the homes we buy at a good profit. We can assist many home sellers in distress and we can assist many to rebuild their credit and own a home.

Now we are not saying that everyone should find themselves eager and excited about buying a home in the Tampa Bay area, we are not guaranteeing that the prices of homes will suddenly increase as the baby boomers escape the cold, the high heating oil prices and high taxes to move to our warm climate, and we are not saying that we can buy every house at less than half of its independently appraised value and then sell every house we buy full value in two years, but we do believe our track record proves that even in a down market we can help those in distress and those who want to own a home and do so with minimal risk and consistent profits. That will help alleviate some of the distress in the housing market, won't it? 

To find out more, email John Lux at lux.investor@gmail.com