Last year Alice bought his first property: a run-down single-family apartment in the working-class New York suburb of Bronx for $200,000 in cash. The place, which he spotted on csrealtyinvesting.com, was being sold “as is” by the landlord. “The entire building was filled with rubbish and we were working through the spring to remove them,” chuckles Cashmere, the 32-year-old investor who decided to invest in distressed properties and buy houses for cash after working with other investors.
If we look back, in the 1970s, landlords burnt buildings in the poorest communities, like in the South Bronx. The explanation was simple, insurance money was way more lucrative than to refurbish or selling the property thus tagged as distressed. Selling house by owner was a nightmare.
The entire situation points to a problem: distressed houses were a burden to the landlords, because nobody was ready to buy their property in the Bronx. There was not enough or no property dealers to whom they can sell house fast for cash.
There is a cause for every happening in the universe. Bronx was not exceptional. Since 1980, when the “affordable housing” scheme was started by the Mayor, the South Bronx area observed a rapid real estate development. Since then there was no looking back. The Bronx has made exceptional progress by means of mayor’s new housing marketplace plan, which was intended to ensure safe and secure housing for all. Starting in the 1990s, many burned-out and run-down tenements were replaced by multi-unit housing.
Since the housing bubble burst in the Bronx, distressed landlords who were desperately looking to sale their property were hopeful to sale house fast for cash.
Last week the Federal Housing Finance Agency (FHFA) and the National Association of Realtors® (NAR) reported price data.
FHFA data indicated that the real estate prices were up 6.1 percent in October from one year ago.
NAR data showed that prices grew at a 5.6 percent pace from October 2014 to October 2015, in between the Case Shiller and FHFA measures. NAR also reported on new November data which showed a bump up to a 6.3 percent growth from one year ago.
The above statistics shows that the comments of Warren Buffet who recently said, “Distressed single-family homes are attractive investment now” are now proving true in case of the Bronx. Many new real estate companies have shifted their marketing strategy towards this small borough of the state of New York. Bronx’s proximity to Manhattans, real estate price rise of neighboring boroughs are some reasons for the rapid developments taking place here.