The Reinvented Private Investor for Real Estate

There two kinds of private investor for real estate, the passive and the active investor. The active investor directly buys property himself then adds developments like property improvements or repairs then sell for a profit. A passive investor, on the other hand, engages an independent company to locate a property, manage his investment to said property and let this firm sell it at an agreed profit. Both types of private investor for real estate suffered setbacks in the recession. Whereas before 2007, the spread throughout the vast investment playing field of real estate were unlimited structures of deals and transactions, and came the so-called “economic bubble” burst that lead the investing community nowhere but to reinvent itself.

“Bubbles” within the real estate investment community and its market are the sudden unregulated rise in property valuation to the point that real income can't sustain such pricing distortion. This is the time where true market pricing of properties seek its level which in reality is already a steep price fall leaving buyers and sellers of properties at great loss. There were actually no new inventions other than adjustments in fiscal policy incentives to brave said dismal market bubble. It directed the private investor for real estate to refocus on instruments that would work. Among these were the renewed attention given to mortgage consultants, the revivals of real estate clubs, opportunities offered by the “no fees” private lending and who would ever thought that the internet will play a significant role for such a time as this.

The right and competent mortgage consultants and their consultancy firms are gold mines. Their active involvements in clubs where activities like seminars are regularly offered are good venues for investors and financiers to meet, analyze and discuss outlooks and prospects as well as accessing information beneficial to the investing community. Consultants have a way of animating that eventually private lenders are contracted to fill in the investment gaps in real estate business where capital is intensively high and liquidity rollover is almost nil. Since the formal lending institutions are likewise pressed with the deflation of property valuation, private lenders holding “hard money” are engaged since their services are relaxed in terms of paper works and fees but not altogether free of collaterals. Notwithstanding, hard money can finance up to 50 percent or more collateral-based loan enabling the private investor for real estate to call the deal which otherwise lending institutions cannot owing to legal constraints. Foreclosure proceedings turned private lenders to be as eager as the investors themselves as reclaimed properties earned more profits than its original pricing condition. This is not to forget that over 30 million individuals shop and trade online. The trend now is you do not seek financiers but the internet technology’s reversal of the pattern resulted into hard money that goes knocking at your door. It is this same technology that sends buyers right inside the comforts of your living room. Consultants are quite adept in the use of the internet for investors to brave the tight money situation of the economy.

Deals and access to info through interaction and the internet technology are keys to close the investment gaps in real estate. While the effects of a deflated property valuation after an artificial sudden rise in property pricing structure brought a bleak investment climate, this need not be for the reinvented private investor for real estate.