CNBC.com: VIDEO: Investing in Real Estate

Wanted to share this video:

Investing in Real Estate Real estate mogul Donald Trump discusses whether now is the time to buy real estate, particularly properties in foreclosure, with CNBC's Erin Burnett
http://www.cnbc.com/id/15840232?video=561989966

Investors know, best time is to buy when market is down. Pick up income property or buy that home you've always wanted.

Budget and Save

Markets like this is a good time to re-think your spending habits. I know..I know...it's tough but eating out less, buying less junk or brewing your own coffee will save you big time later. Start paying down credit cards with the highest interest rates and put more to savings. Email me and I'll send you a spreadsheet to start the process.

Orange County-Local Market Conditions

CAR (California Assoc. of Realtors) released numbers for this year.
Peak Month Apr-07
Peak Price $747,260
Aug-07 Median $710,380
% Chg From Peak -4.9%

-4.9% isn't bad. The media has Sales and Price confused. That's what consumers read but prices are not down much considering we've had a double digit return in the pass 4 years. The negative price change also reflect the Subprime problem so we're still in good shape. If we did a negative 50% on prices then we have a real problem on our hands. However, if you do the math on a $400k home w/14% interest versus that same home at $800k at 7% interest the payments are pretty darn close. The good thing of buying at $400k is that your property taxes are lower but finding that "perfect" home might not be at $400k. Conclusion, if you're a buyer and found a home that you know you will not find again..buy it. As for seller's, your home doesn't have as much "equity" as you think it does, it was unrealized gained to begin with. The good thing for seller's is that once you sell you can buy in low. It's all relative. Home ownership shouldn't be a gamble. Get into the right loan, pay your mortgage and enjoy your home.

FED Reduces Rate-Good or Bad

It's not going to get buyer's out because the reality is, is that some cannot afford or qualify, regardless. The only thing that worries me is that consumers might spend more on other things to increase debt. Reducing the rates will assist the current ARM holders, 2nd Trust Deeds and assist lenders to re-structure borrower's loans. Let's just hope consumers don't go on a spending spree. If only we can control spending in a direct way. Email me if you need help budgeting. It's my area of expertise.

Mortgage Mess-Blame Game

Lenders blaming brokers. Brokers pointing back at lenders. Consumers upset at lenders and brokers. All in all, no one was complaining when money was being made including Asset Managers, Lenders, Brokers to Consumers. Politicians are taking congressional action now but the bottom line is everyone should have stopped and taken a breathe. I agree that professionals should be communicating with their clients and providing them long-term professional advice. However, many "professionals" spurted up during the creation of these ARM loans so they themselves didn't know the benefits of a traditional 30 year fixed vs the ARM or let alone the negative affects of no doc, stated income and full doc loans. Lenders came up with these products and guidelines because financing was so cheap. Then came a market flooded with brokers, wholesale lenders and direct lenders. Consumers then flooded the market attempting to flip homes and get rich quick. Some made it out with a nice sum of money and the remaining left with bad credit and no home. It's a tough situation to grasp but it's a reality. High risk gives high rewards if you make it to that point, however. I do feel for consumers because they're the little people that will take much longer to recover then the banks. No one could have predicted this downfall in the market, not even Alan Greenspan. Sometimes it helps just to be the "conservative" consumer as half of the world is and they're fine. Professionals should take time in their day to lend a hand by listening or giving consumers options because the guy that sold them "that" loan is long gone and it's up to us "long timers" to give back to the community with knowledge and options that banks are not. Fortunately, none of my clients are in this situation but the least I can do is help with the knowledge that I have.