Mike's Dyersburg Real Estate Blog

I spent the whole day on Wednesday with a realtor/investor from California. "Mary" came to northwest Tennessee(Dyersburg-80 miles north of Memphis). Not only did she visit some properties that she and her clients have under contract, but she also wanted to look at several other commercial properties.

Mary is originally from Indonesia where most of her family members and investors still reside. She made the statement, "my family  and friends in indonesia need to invest right now in good cash flowing commercial properties in the US because of the falling dollar".

I am trying to wrap my brain around that statement but having a hard time. Can anyone help me understand the relationship of falling dollar to investments here in my area? I appreciate your input! 

About 3 weeks ago I got a response off loopnet from a realtor/broker in California. She called inquiring about some commercial and residential property I had listed in Newbern,Tennessee. I sent her loads of extra pictures and information and she was ready for her clients to buy. So, I wrote the contracts for her to give to her California clients and we then negotiated the two contracts subject to this broker(Mary) coming to Tennessee next Tuesday and review the properties with the assistance of a local inspector. She also stated that she has other investors wanting to purchase here as well. If you have cash flowing properties that you want to sell, let me know and I will put Mary on them.

I have been talking to other realtors here in Dyersburg(west) Tennessee and they too are working with California investors. There also appears to be investors from Florida also buying here in Tennessee. Another realtor here just sold a down town mini shopping center to an investor and there have been a couple of mini storages sold recently to California investors.

My staff and I are scrambling to find other cash flowing investments for California investors wanting to purchase here in west Tennessee.   

Our market is starting to feel the effects of the national b-paper collapse. I am still seeing alot of potential buyers but many of them have houses to sell first and many of these are out of state. We are still having people relocate in here and several of them are buyers. Up until 6 months ago, it was hard to find available homes in the price range of $100,000-$150,000. Now, that price range has many listed homes available.

Many of the newer companies that had taken advantage of the b-paper feeding frenzy are really feeling the effects of the b-paper collapse. We are not seeing many sales now by those companies and agents that were doing the sub prime deals. I expect many of these agents to retire their license before years end.

Those homes sold by these b-paper realtors are starting to show up as foreclosures(many getting listed every week). Many of these were sold and mortgage companies allowed the borrower to borrow 100% and lender allowed purchaser's closing costs to be paid by seller(price just bumped up). For the last 4-5 months that lending faucet seems to be cut off but the homes going into foreclosure should continue to climb until that initial 2 years fixed interest rate period has passed for all of these loans. With that said I expect the foreclosures to peak here in Dyersburg withing the next 6-12 months and then start to decline. The price range most affected by this ARM (adjustable rate mortgage) collapse in Dyersburg is $50,000-$80,000.

There will be lots of money lost by these lenders. We see several national financial companies writing off millions of dollars every month. These big companies own the b-paper companies or subsidiaries that made these loans. These lenders(and realtors) saw an opportunity to make some quick easy money regardless if it was best for the client.

In the long run, this upheaval will be good for the real estate and lending industry and good for Dyersburg,Tennessee. Realtors here will just have to do business the old fashioned way(hard work).