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The real estate bubble hasn't burst...

The real estate bubble hasn't burst...
The bubble hasn't burst... it's just taking a well-deserved break.

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Great CNBC Article about the Credit Crisis
2008-03-20 23:59:00
The headline of this article might hit home..."Can’t Grasp Credit Crisis ? Join the Club"For those of us who are not financial experts, this article published by CNBC goes over the entire Credit Crisis, A to Z, start to finish. Read the article here.LK Subscribe in a reader
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THE "R" WORD
2008-01-16 23:25:00
The following blog post summarizes recent events in the U.S. economy leading up to a recession and reassures that there is remedy at the end of the tunnel.THE "R" WORDBy Ron OjedaOK, the writing is on the wall. It appears 2008 will be a sluggish year for the overall U.S. economy. Last Friday capped off the worst seven trading day start to the new year since 1990 when Saddam Hussein’s army was still getting settled in Kuwait. Economists across the financial industry have shifted their views on the possibility of a recession past the 50% mark and acknowledged it as the more likely outcome going into 2008. The word “Recession” brings up images of closed businesses and unemployment but let’s clarify the definition of recession.An economy that is in a recession has experienced at least TWO quarters of contraction by measure of the GDP. That’s correct, two. This is not to say it is not serious, especially to those families and individuals who are directly impacted by it. Howev...
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To Catch a Dropping Knife
2007-11-28 23:53:00
Two dramatic days in the stock market have been driven by renewed investor confidence. Yesterday’s 200+ point advance was triggered by a $7.5 billion investment in one of our largest financial institutions, Citigroup. The source of this investment, the Abu Dhabi Investment Authority, generates questions from many philosophical, political and financial fronts, and at the same time encourages investors in both the debt and equity markets that the fundamental value of the US financial sector is still very real regardless of uncertainties in the near term. It also provides confidence that the Fed is not the only white knight out there with deep pockets. Today’s 300+ point gain in the U.S. stock market was helped by comments made by Vice Chairman of the Federal Reserve Donald Kohn. He told the Council on Foreign Relations “uncertainties” in the markets “require flexible and pragmatic policymaking”. Wall Street interpreted these remarks to mean the Fed will cut rates ...
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Invesco to move HQ to Atlanta
2007-11-21 20:26:00
A recent issue of the Atlanta Business Chronicle had an article about Invesco Plc (the global investment firm) relocating its London headquarters to Atlanta. Invesco is a global money manager with $2.41B in annual revenues; this move is projected to bring in 150 jobs. The article states "While heavy on on symbolism, the real benefits of Invesco's headquarters having an Atlanta address will play out in the years ahead."Invesco is planning to combine its HQ and Atlanta office into one location... the new Two Peachtree Pointe in Midtown Atlanta. Subscribe in a reader
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Survey: 65% of IRA holders consider real estate as an investment for retire
2007-11-01 23:23:00
I found this article browsing google the other day and had to share it. It is from the Birmingham Business Journal, quoting a survey conducted by a firm called Guidant Financial Group. Real Estate has been and will continue to be a predictable investment for building wealth for retirement. We will see more and more traditional long-term hold strategies and a new wave of investors looking to rent property out for 5 years at a conservative 4% annual appreciation rate rather than flip a property for 30% profits in what used to be 20 days.The article:"Despite a slow national real estate market, a recent survey showed real estate is the No. 1 choice for self-directed investors. Washington-based Guidant Financial Group conducted a survey of nearly 1,000 self-directed IRA holders and found that nearly 65 percent of the respondents said they were considering property as an investment for their retirement savings. Nearly 60 percent chose rental property, more than 36 percent chose...
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Alan Greenspan on 60 Minutes: Housing Market and Economic Forecast
2007-09-17 19:53:00
Alan Greenspan was interviewed on CBS's 60 Minutes with an outlook on the US housing market and economic forecast.Greenspan stated "... we're gonna get through this particular credit crunch... we always do..."This is a reinforcement that the real estate bubble hasn't burst... it's just taking a well-deserved break. Subscribe in a reader
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An innovative vision: Residential Rental Real Estate as an Asset Class (RRR
2007-09-17 18:49:00
Blue Moon Capital is more than a money manager, more than a real estate investment company/wholesaler/hard money lender/reo buyer/ turn-key opportunity provider... Blue Moon is an innovative company with a vision of creating "Residential Rental Real Estate as an Asset Class.""Well I had always been fond of real estate, and i saw it was an opportunity to do something in the industry that nobody has ever done before... and that is create residential rental real estate as an asset class, which up until today nobody has ever realized that it has the potential that it does today primarily because the industry considers residential rental real estate as cumbersome, awkward, hard to manage but we look at a process whereby we can make it manageable..."Blue Moon Capital Overview on YouTube Subscribe in a reader
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Calming Seas in the Credit Markets
2007-09-07 01:01:00
It appears that most of the high profile news about the "Credit Crunch" is out there. At least this wave. Lenders have had some time to locate and identify enough of the subprime risk that is either currently in their portfolios, been packaged and sold to investors, or in the pipeline and being processed in order to evaluate and put some measure of quantitative valuation on their risk exposure. Some lenders have already started to add loan products back to their menus and some large lenders have decided to retain the loans in their own portfolios instead of selling them to the secondary market. By doing this they do not take the risk of having to sell the loans at a discount which would result in a loss to them. This also is giving them a competitive advantage over less financially sound banks by allowing them to make loans their financially weaker competitors cannot and consequently taking away market share .. Subscribe in a reader
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It's a bird... It's a plane... It's... ... Bank of America!
2007-08-23 01:12:00
Notable News:Bank of America to invest $2 bln in Countrywide: WSJ"NEW YORK (Reuters) - Bank of America Corp plans to invest $2 billion in Countrywide Financial Corp, the mortgage lender that has faced a liquidity crunch this month, the Wall Street Journal said on Wednesday." Source: www.reuters.com Subscribe in a reader
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WaMu leads the pack back in
2007-08-23 00:24:00
After speaking with a number of mortgage professionals, I have gained knowledge that WaMu is once again offering stated income loans for W-2 borrowers.While that may not sound like a dramatic announcement in and of itself, the mere idea that a large national lender is restoring loan products to their menu is a sign of a reversal of the trend of the last three weeks.It should be considered that WaMu has one of the strongest balance sheets in the industry and this may be indicative of what other financially strong lenders, such as Bank of America and Wells Fargo, might do in the near future. -R.O. Subscribe in a reader
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Recorded Teleseminar: Lending Environment Update
2007-08-22 18:39:00
Our friends at NARREIA got on the phone with our own Ron Ojeda and Erik Santus to discuss the lending environment and outlook for investors. This is a very important teleseminar and I encourage all of you to listen in!Click here to access the teleseminar through the NARREIA website (May take a minute or two to download) Subscribe in a reader
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Equity Vs. Positive Cash Flow Debate- Recording Available
2007-08-21 22:15:00
The Equity Vs. Positive cash flow debate is now available online thanks to NARREIA!To listen to the debate with Sean Brown of NARREIA and Erik Santus of Blue Moon Capital, please visit:Equity vs. Positive Cash Flow Debate Subscribe in a reader
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436 Winton St. Philadelphia, PA
2007-08-20 22:44:00
436 Winton St. Philadelphia , PAPhiladelphia Real Estate Investment3BR, 1 BA, 980 Sq. Ft.Market Rent: $850-$950Projected ARV: $195,000Projected Refinance: $156,000 (or 80% Lender's final appraisal)Built-in Equity: $39,000Down: $5,000Closing Costs: $0 (with approved loan type)Scope of Work/Rehab in Process: $29,700

1123 Sargeant St. Baltimore, MD
2007-08-20 21:37:00
1123 Sarg eant St.Baltimore Investment Property 1123 Sarge ant St is only 1 mile away from Oriole Park, home field of the Baltimore Oriels baseball team. Baltimore is known for its exquisite seafood restaurant selection and prime location in between New York City and Washington D.C. 1123 Sargeant St. Baltimore, MDTargeted ARV After Repairs: $255,000Targeted Refinance Amount: $204,000 (Or 80% Final Appraisal)Projected Built-in Equity: $51,000Total Down Payment: $5,000Rehab In process: $81,000Closing Costs: $0 Street Scene

Visions of Rollercoasters and "Dead Cats"
2007-08-15 19:25:00
By Ron Ojeda, Blue Moon Capital Debt and equity markets from Chicago to New York to overseas continued to react to the uncertainty created by an illiquid debt market. Last week started with three days of gains that were the best we?ve seen since March of 2003. But the lion?s share of those gains were experienced in a relatively narrow band of the S&P 500; financials, materials and energy markets were the sectors hardest hit since mid July. With that lack of breadth, most savvy traders had one eye on the door. On Thursday when BNP Paribas, the largest bank in France, barred withdrawals from three of its? asset backed securities funds, the broad selling started. Nine out of ten sectors in the S&P 500 were down more than 2.5%. By the way?that?s why it?s illegal to yell ?Fire!? in a crowded theater. If it were not for the ?dead cat bounce? on Friday with the market recovering late in the day from a 213 point drop to finish at down just 31 points, the market would have suffer...
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Visions of Rollercoasters and "Dead Cats"
2007-08-15 19:25:00
By Ron Ojeda, Blue Moon Capital Debt and equity markets from Chicago to New York to overseas continued to react to the uncertainty created by an illiquid debt market. Last week started with three days of gains that were the best we’ve seen since March of 2003. But the lion’s share of those gains were experienced in a relatively narrow band of the S&P 500; financials, materials and energy markets were the sectors hardest hit since mid July. With that lack of breadth, most savvy traders had one eye on the door. On Thursday when BNP Paribas, the largest bank in France, barred withdrawals from three of its’ asset backed securities funds, the broad selling started. Nine out of ten sectors in the S&P 500 were down more than 2.5%. By the way…that’s why it’s illegal to yell “Fire!” in a crowded theater. If it were not for the “dead cat bounce” on Friday with the market recovering late in the day from a 213 point drop to finish at down just 31 points, the mark...
More About: Cats , Dead , Visions , Roller , Aster

Update: Lenders Tighten Belts
2007-08-10 19:44:00
Signs of Change It shouldn’t be a mystery that the lending industry is carefully rethinking their actions and changing their standards after last week’s crisis. So far, we have seen one of our several national lenders start to tighten their belt a couple notches in hopes of disqualifying more individuals for risky loan types such as the payment option loan, which is often sought after by investors looking to leverage for positive cash flow. Blue Moon was advised early this week that the payment option loan type was still available to only strong borrowers with 680+ FICO scores, and with an additional 3 points at closing. To be fair, all loans are going to be requiring more “skin in the game” from the borrower, whether it be in the form of more points upfront or higher interest rates. The increased rates on loans across the board are a reflection of the lender’s uncertainty about what will happen over the next 30-60 days. Since they don’t’ have enough information ...
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Update: Lenders Tighten Belts
2007-08-10 19:44:00
Signs of Change It shouldn?t be a mystery that the lending industry is carefully rethinking their actions and changing their standards after last week?s crisis. So far, we have seen one of our several national lenders start to tighten their belt a couple notches in hopes of disqualifying more individuals for risky loan types such as the payment option loan, which is often sought after by investors looking to leverage for positive cash flow. Blue Moon was advised early this week that the payment option loan type was still available to only strong borrowers with 680+ FICO scores, and with an additional 3 points at closing. To be fair, all loans are going to be requiring more ?skin in the game? from the borrower, whether it be in the form of more points upfront or higher interest rates. The increased rates on loans across the board are a reflection of the lender?s uncertainty about what will happen over the next 30-60 days. Since they don?t? have enough information to evaluate th...
More About: Update , Belts , Lend , Lenders , Enders

Teleconference: Equity Vs. Positive Cashflow Debate
2007-08-10 18:08:00
Blue Moon Capital has been invited by NARREIA for an Equity Vs. Positive Cash Flow debate.For more details on this event, please visit NARREIATo Register: RSVP for the upcoming BMC Live Teleconference on Tuesday, August 14th, 6 PM Pacific Time (9 PM Eastern) by contacting JeffKlein@narreia.com for call access info.Hope to see you soon! Subscribe in a reader
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Lending Industry Changes Will Affect Real Estate Investors
2007-08-08 16:10:00
Press Release Lending Industry Changes Will Affect Real Estate Investors By: Ron Ojeda, Blue Moon Capital, LLC Given the alarming events of the last two weeks encompassing the stock, bond and housing markets, it comes as no surprise that both investors and industry participants alike are trying to make sense of what has now become one of the most tumultuous periods over the last 20 years for the real estate and mortgage industries. The past two weeks have fostered a clear contraction of the mortgage banking industry. Some very well known, and some not so well known, mortgage banks have closed their doors in the past 30 days, laying off thousands of employees while seeking protection from creditors within the bankruptcy courts. There is no doubt over the next 30 days we will witness more carnage and the number will swell as the investors who loan these mortgage facilities money to in turn lend to consumers, proceed to either temporarily cease all “warehouse lending” t...
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Lending Industry Changes Will Affect Real Estate Investors
2007-08-08 16:10:00
Press Release Lending Industry Changes Will Affect Real Estate Investors By: Ron Ojeda, Blue Moon Capital, LLC Given the alarming events of the last two weeks encompassing the stock, bond and housing markets, it comes as no surprise that both investors and industry participants alike are trying to make sense of what has now become one of the most tumultuous periods over the last 20 years for the real estate and mortgage industries. The past two weeks have fostered a clear contraction of the mortgage banking industry. Some very well known, and some not so well known, mortgage banks have closed their doors in the past 30 days, laying off thousands of employees while seeking protection from creditors within the bankruptcy courts. There is no doubt over the next 30 days we will witness more carnage and the number will swell as the investors who loan these mortgage facilities money to in turn lend to consumers, proceed to either temporarily cease all ?warehouse lending? to th...
More About: Real Estate

The blood is in the streets… and the money is in the air… Part III
2007-05-31 22:28:00
What society realized is that real estate, under the norm, is not as liquid as stocks and bonds and the real estate market is a lot larger than equity markets. In the equity markets, liquidity is defined by the number of buyers willing to take ownership at a set price. In the real estate market, liquidity is determined by how willing the lenders are to lend money to buyers.The fuel of the market boom was the availability of funding and the need to place it. Lenders created new products to introduce a new type of homebuyer- the subprime market, which would essentially increase the rate of homeownership. We saw the introduction of sub-prime option-arm loans (which were a bad idea from the beginning but no one raised their hand to question them). Today, many of these new-found homeowners are in an adjustable rate mortgage and do not have the income to cushion the anticipated fluctuating mortgage payments.The over willingness of lenders to lend, and over lend, to the sub-prime market...
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The blood is in the streets? and the money is in the air? Part III
2007-05-31 22:28:00
What society realized is that real estate, under the norm, is not as liquid as stocks and bonds and the real estate market is a lot larger than equity markets. In the equity markets, liquidity is defined by the number of buyers willing to take ownership at a set price. In the real estate market, liquidity is determined by how willing the lenders are to lend money to buyers.The fuel of the market boom was the availability of funding and the need to place it. Lenders created new products to introduce a new type of homebuyer- the subprime market, which would essentially increase the rate of homeownership. We saw the introduction of sub-prime option-arm loans (which were a bad idea from the beginning but no one raised their hand to question them). Today, many of these new-found homeowners are in an adjustable rate mortgage and do not have the income to cushion the anticipated fluctuating mortgage payments.The over willingness of lenders to lend, and over lend, to the sub-prime market...
More About: Money , Blood , Part , Streets , The Streets

The blood is in the streets... the money is in the air... Part II
2007-05-27 07:24:00
The blood is in the streets? when did the leak start? Let?s go back in history for a better understanding of where the market is today.Over the past two decades, Middle America became familiar with investments through the use of 401Ks and other types of retirement plans which introduced them into the stock and bond market. The equity markets were the new avenue to financial freedom and wealth.However, because of the market corrections of the 1987 crash and the 1998 tech bubble, society was forced to become accustomed not only to the up?s and down?s of the market, but also to the extreme emotional distress of these market fluctuations.Psychologically, those fears were reserved for those riskier types of investments and real estate was considered the new safe haven to asset diversification. Middle America started considering their own home as their investment with hopes in adding to their portfolio through purchasing a second, third, and so on.Enter- the media. Books, tapes, DVD?s, s...
More About: Money , Blood , Part , Streets , The Streets

The blood is in the streets... the money is in the air... Part II
2007-05-27 07:24:00
The blood is in the streets… when did the leak start? Let’s go back in history for a better understanding of where the market is today.Over the past two decades, Middle America became familiar with investments through the use of 401Ks and other types of retirement plans which introduced them into the stock and bond market. The equity markets were the new avenue to financial freedom and wealth.However, because of the market corrections of the 1987 crash and the 1998 tech bubble, society was forced to become accustomed not only to the up’s and down’s of the market, but also to the extreme emotional distress of these market fluctuations.Psychologically, those fears were reserved for those riskier types of investments and real estate was considered the new safe haven to asset diversification. Middle America started considering their own home as their investment with hopes in adding to their portfolio through purchasing a second, third, and so on.Enter- the media. Books, tapes, ...
More About: Money , Blood , Part , Streets , The Streets

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