Wednesday, September 12, 2012

Larger Firms are Buying Foreclosed Homes Causing Small Businesses to be Outbid While low priced California Land is Still available.

Larger investment firms on Wall Street have branched off into buying foreclosed homes. Usually such a small investment would not be of interest to Wall Street but they are now buying these homes to rent them out and eventually sell them when the market improves. These firms are buying homes all over the country at the court house steps where most foreclosed homes are sold. We went to a few of these sales and attempted to bid on a property, but we were outbid. A home which might sell on the market for $100,000 sold for $85,000. A small operation may bid $65,000 for such a home as the cost to clean it up and make it ready for renting may cut into the resale value. Increasingly small mom and pop businesses get outbid by these new large capital investment firms. Small firms like at least at 20% yield on a home while the larger investment firm will take 10% yield. We have seen low end bidding homes slowly and then when the auctioneer says last and final the bid bidder (investment firm) bids it up and takes it. Many of these foreclosed homes have had squatters living on the premises, or broken windows, and doors. It causes security and insurance issues with the property. Many insurance companies require that you live in the state where your investment home is, or have a property manager on site. According to a recent news reports one firm bought over a 100 homes in a day totaling over $8 million. These large investment firms are raising money from investors to buy and mange these properties and they are backed with billions of dollars. Most banks currently sell foreclosed homes one at a time, and lots of them get pulled from the auction list as they work with the property owner to save the property. It takes a lot or time effort and money to buy these foreclosed homes, while very well priced ideal land parcels are available with little to no other buyers vying against you. We specialize in low price land opportunities in Lancaster and Palmdale, Ca. If we don’t have the property on our inventory then we will locate a suitable property that meets your needs. We work with solar firms, mitigation bankers, land bankers and individual investors. We can locate the best priced property for your individual portfolio. Call us at 213 500-9578

Monday, September 3, 2012

Los Angeles County Proposes Rural Land Zoning Changes in Antelope Valley which Is Unfavorable to Land Investors

Los Angeles Regional Planning has been proposing new rural agricultural land zoning from the generally current zoning of LCA (Los Angeles County Agricultural and rural zoning. The current zoning allows farming and one home per 2 acres in the majority of Antelope Valley’s east and west sides. Many of the parcels on the far east side and far west sides of the Antelope Valley are 2.5 acres to 640 acres. This zoning today is fairly favorable to land owners as it allows say two dwellings in a four acre lot. Most parcels are broken down from 2.5, 5, 10, 20, 40 acres and so on up to 640 acres. The new zoning will drastically change the land use and development of these parcels and the vast majority of parcels will fall into RL 10 or RL 20, which is Rural Land one dwelling per 10 acres or one dwelling per 20 acres. This new zoning change will impact thousands of land owners negatively. This means you will need at least 10 acres on the far east or far west in order to put one house on your property. Most Antelope Valley Country land owners will need 20 acres in order to build one dwelling. So land owners with large parcels in the 40 to 640 acres will only be able to put a minimal amount of homes on their parcels. Thusly you can only put two homes on a 40 acres parcel zoned RL-20. It means the county wants this land to have limited development or to be farmed but the cost to run power, and water to these remote areas would be cost prohibited. Also with the water rights being reduced the availability to drill a well going forward will also be more difficult as the county wants to reduce the number or wells in the valley. These zoning changes will drastically reduce the value of property owners land as developers will not develop in these proposed low density zoning areas, as the return on their investment would not justify the expense. On the flip side land within the city limits of Lancaster and Palmdale should show more value over time as they will have access to city services and far far better zoning opportunities today and going forward. It is clear that Los Angeles County doesn’t want Antelope Valley to look like San Fernando Valley. Some of the reasons the county gives for these proposed changes are that it protects environmental resources, enhances rural land character, minimizes natural hazard threats, creates an efficient use of the infrastructure and public facilities, and limits green house gases. We think it clearly reduces their tax revenue, and ends Los Angeles Counties growth curve as 49% of all the vacant undeveloped land is in Antelope Valley. The zoning changes are still within the proposal stages, but Los Angeles County has been trying to make these changes for years. Maps of the new zoning can be found via Los Angeles Regional Planning or contact us and we can show you where to get them.