If you’re in town this weekend, check out the Beach Boogie & BBQ Festival !  This annual festival features family-friendly entertainment and events, including live music, the official barbeque competition of South Carolina, a classic car show, competitive BBQ sandwich eating competition, a HUGE kids’ area, boat rides on the lake, arts and crafts vendors, a car giveaway and so much more! All of the details are here. It’s fun for everyone!

When real estate was the hottest thing since sliced bread, everybody was watching the real estate reality shows, drooling over the easy profits that could be had - if only you would just get into the game.  Two years ago, Flip This House produced an episode here in Myrtle Beach that featured this Ocean Boulevard home:

This home is located in one of the prime residential areas of Myrtle Beach known as the Golden Mile, but it needed some serious work. Among the renovations this house received were: new kitchen, new flooring, new landscaping, new exterior paint. Typical for the properties featured on this show.

As always, the episode ended with the ominous Open House, where they show many people viewing the property and then an update on the house. Normally, they discuss the price of the property, the cost of renovations, and the profit from the flip.  This ending was slightly different: ‘Several of the buyers who looked at the home had high levels of interest and this home should be sold in the next few days.’

So what really happened after the cameras were turned off and the lights went out?

Purchase price on the property: $837,000

Renovations: Undisclosed (Requests to Trademark Properties were not answered.)

Original listing: $1,199,000 in November, 2006

Sold: $873,000 in February, 2008

Real estate commissions paid: $52,380

Final Result: Net loss of over $15,000 on price alone.  Once we add in the estimated cost of renovation and fifteen months of mortgage payments, this flip was a flop.

We hear all the time about investors who are purchasing short sales or foreclosures and then spending tens of thousands of dollars on repairs or updates… and only after the repairs are complete does the waiting start. And more waiting. And the hemmoraging of profit.

Our approach is different.  We work with our investors to invest into demand, and we walk the walk.  I can show you the check for $5,000.00 my tenant/buyer eagerly paid in order to move into my home.  Our ‘flips’ are engineered a year (or two) in advance.   Our tenant/buyers appreciate the transparency of the transaction. Our investors can count on locked-in profit. Everybody wins.

And every time I drive past this flop, I have to wonder… how many other quick-flip investors would be better off today financially if they were using our system?  And how many more happy Myrtle Beach real estate homeowners would there be right now?

(This is a continuation of Part 1 - Click here to read Part 1.)

In my last post, I promised details of how the new mortgage law can help you if you’re stuck in one of their “targeted” loan situations, as well as details on the “gotcha” in the new home buyer tax credit.

First, if your current mortgage is an adjustable rate mortgage, and you’ve been stung by ever-increasing monthly payment hikes, you might qualify for a new FHA loan.  You qualify if you meet all of these criteria:

- Is your mortgage on your primary residence?
- Was your loan originated between January, 2005 and June, 2007?
- Do you currently spend 31% (or more) of your gross monthly income on your mortgage?
- If your mortgage the ONLY loan on the property?

If you answered “yes” to these questions, and your lender agrees to drop your loan balance to 90% of your home’s current appraised value, then you can obtain a new FHA-insured mortgage at current 30-year fixed rates.  If you are currently paying your mortgage on time, you must be able to prove that you won’t be able to continue paying the mortgage.  If you are already in default, you must show that you are not deliberately in default so that you can obtain lower payments.

The new loan will specify that you can’t take out a home equity loan or line of credit for at least five years, unless it is necessary to pay for upkeep on the home. And in that case, FHA must approve the loan or line of credit, and it cannot exceed 95% of the home’s then-appraised value.

Also, FHA will require that you share the profits from any future appreciation by paying a 3% “exit fee” on the principal balance of the loan when you sell or refinance the property.  If you sell or refinance the property within one year, you’ll have to pay FHA 100% of the difference between your loan principal amount and your sales price.

To see if your lender is participating, contact your current loan servicer.

The new home buyer tax ‘refund’ sounds great - an automatic $7,500 if you buy a home - but beware! Here’s how this really works.  You will receive a tax refund worth up to 10% of your home’s purchase price - up to a total refund of $7,500.00.

However, you will be required to pay this money back through equal installments over fifteen years.  So, in reality, it’s more like an interest-free LOAN than a REFUND.

As always, keep in mind that we are not attorneys, accountants, tax experts or fortune-tellers, and we encourage you to rely on these experts for advice pertinent to your personal situation.  Do continue to rely on your Myrtle Beach real estate experts for the latest news and goings-on around town.

Sometimes it takes a really good writer to make clear what a mediocre writer has been trying to say all along.

I read this in Wired Magazine tonight and am pleased to credit them with this Yes! Yes! Yes! moment…

…We said that the Internet would erode Old Media’s monopoly on interpreting reality, and we were right about that. If you’re surfing… you’re not reading the paper edition of The New York Times. The result is imploding Old Media and exploding Google ad revenue… The purpose of media isn’t, ultimately, to inform; it’s to sell our eyeballs to advertisers. And how better to do that - if your monopoly is being eroded by this newfangled Internet - than to scare the (crap) out of us? Then, we’re so paralyzed that we stick around through the commercials. Faced with fierce competition for those eyeballs, Old Media is hawking the apocalypse. The world is inundated by war, poverty, destruction, fascist Republicans! It’s about to be swept away by tidal waves unleashed by melting polar ice caps! More on how this is humanity’s own fault - after the break.

“One man’s loss is another man’s gain.”

From Will Rogers, “…out here I had been putting what little money I had in [waterfrontage], for the sole reason that there was only so much of it and no more, and that they wasn’t making any more…”

So those two quotes may be overused, but there’s no better way to introduce this property…

A pre-development community, The Boardwalk on the Waterway was initially offered in late 2004.  This community is located directly on the Intracoastal Waterway, on the west side (the mainland) of the Waterway, and is tucked away behind the new Hard Rock Park. 

The infrastructure has been installed, and the “boardwalk” (a 6′ walkway traversing the entire water frontage of the community) has been constructed over the protective seawall.  A waterway gazebo, entrance gate and gatehouse have been constructed, and the road paving is completed.

The waterfront homesites were initially offered to the public at $272,880, and sold for as much as $399,880.

At this moment, you can acquire one of these DIRECT INTRACOASTAL WATERWAY homesites for just $229,900. Remember, one man’s loss is another man’s gain…

If you’ve considered purchasing waterfront real estate in Myrtle Beach, it does not get any better than this.  The community is located in the HEART of town, close to shops, entertainment, restaurants, golf courses and more.  It’s so easy to get around using the new highways, bridges and the airport (just a few miles down the road).  You can even WALK to Hard Rock Park.  There is no time frame in which you must build, and you can select your own builder.

If you are interested in one of these incredible deals, don’t wait.  Contact Price & Company Realty today!