REITs: Indicating Market Upticks?

In the past I've discussed many ways to do technical and fundamental analysis on the real estate market. One of those methods was using REITs (Real Estate Investment Trusts) as indicators for which way the market is moving.

Personally, my strategy is based on the idea that we have hit the bottom for many areas. Obviously there is plenty of room for some properties to go down some, and some to go up - but overall, this is my belief.

The anecdotal reports I've read across the country and analysis is what leads my to this, not a single number or source.

One of the interesting things I have observed is we have formed a new support level with the REIT index, further indicating the bottom has occurred. The index in is a trading range at the moment right now, which means things are limbo more or less - not really going up, not going down.

Three things can happen. It can remain in limbo, drop through support (and go down), break through resistance (and go up).

If the REIT index breaks through 530, I think it is sure sign that the overall sentiment will change to real estate is now a "value" investment by the many people. Already the smart money has moved back into real estate.

The point of this is twofold...

  1. Keep an eye on all indicators. No single indicator means nothing on its own. Just unemployment or foreclosure rates or any other indicator means nothing on its own. REIT can be a good indicator because it represents the sentiment of others which will push the market to a degree itself.
  2. The window to get the absolute bargin basement prices appears to be closing a little each day. If you are standing still or wasting time, get moving. If you need to expedite your learning or someone to keep you on track and help you, think about joining the Success Academy.
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awesome

robasciotti's picture

This good kick in the butt to get things going... this were people need to realise that time is of the essence. Their no telling when this great opportunity could seise. True their is always tmie buy and sell but like DG said theirs is no better time than now... So stop sitting on your butt and get going people... If you need to join the academy if you think you got it then get it!!!

Thank you Dean!

Action ACtion ACtion

shanegore08's picture

I am going to be smart and join the Success Academy. This Monday I should be completeing my interviews to get in. I do not want to waste time figuring out how to execute Dean's strategies, I just want to go straight to success. Even if the market climbs back to a sellers market. I feel comfortable that Dean and his staff hae the knowledge of how to propel me to success in any market. Lets go ACtion, ACtion, ACtion!!!!

Action ACtion ACtion

shanegore08's picture

I am going to be smart and join the Success Academy. This Monday I should be completeing my interviews to get in. I do not want to waste time figuring out how to execute Dean's strategies, I just want to go straight to success. Even if the market climbs back to a sellers market. I feel comfortable that Dean and his staff hae the knowledge of how to propel me to success in any market. Lets go ACtion, ACtion, ACtion!!!!

Great information on Market Indicators!

Indiana-Joe's picture

Thanks for sharing the information on the market indicators. This information is key when trying to understand and access where the market is and may be headed in the future.

I also try to create my own local market indicators, as well for the local areas and factor in effects such as seasonal buying, days on the market, how quickly local banks are closing loans, etc.

I believe the more you understand the indicators in the real estate market, the better decisions you can make. Thus, your offers are based on true market factors and you may be ahead of where the market is headed thus creating a better opportunity for yourself.

Thanks again for sharing the insightful information. Believe and Achieve! Smiling - Joe

BUY BUY BUY

thebossspringsteenfan's picture

Now is the time to scoop up all the properties that we can. My goal is to buy and hold, rent them out, and when the market climbs up we will sell for a killing.

Jeremy

Thanks

lucio's picture

Thanks for that info that way it give us a really good understanding of the market we are sitting at.A really good way to show us to stop warming up the chair. Thanks again!!!

overall I have to agree with

grandpa's picture

overall I have to agree with Dean. I have seen pockets that have reversed. there are areas in zips that`s holding or gone up, while other areas in the same zip has not.

Thanks!

MyDestiny's picture

Thanks for the info! Continued success.....Lubertha

Good Information Dean

Thanks for sharing all the wonderful information that you provided to your people. God Bless You !

Warm regards,

Paul T. La Moy

Dean!

Freebird49's picture

You are a God sent sir! My inspiration I aways needed in my life!

Jeff(eagle investment properties, inc)

"I am in control of my own desiny"

"Always think positive and let happiness be your guide"

Dean!

Freebird49's picture

You are a God sent sir! My inspiration I aways needed in my life!

Jeff(eagle investment properties, inc)

"I am in control of my own desiny"

"Always think positive and let happiness be your guide"

Market

I have talked to realestate brokers and they are saying the same thing, now is the time to buy...get on the band wagon and get your feet wet. We have joined the academy now waiting for state stuff to get started,hope it will be fast we are very eager to go, Make it Happen! Thank you all for the help, Diane Brian

My little testimonial

Thank you for all the good advice and the up-to-date info! I have been a waitress and single mom for quite a few years and began "investing" with my starter home in '95 which turned into a rental when I bought a multi-unit "money pit" which really took me for a ride!

A house fire, overflowing toilet that caved in a ceiling and leaving lots of water damage, re-structuring porches, insulating, re-siding, ripping out almost every plaster/lathe wall in all 4 units, electrical upgrades, fixing the 10 things found to be wrong behind every "simple" repair (or so I thought) etc.... Hanging on for dear life financially while being left to raise my infant daughter alone has shown me what I was made of and looking back I'm in awe that I made it through! It has taken about 8 years to stabalize after being jolted so hard, but I never gave up! I've been waiting for an opportunity to come along for leveraging up another step. I am happy to say that I will be closing on a foreclosure this coming week while still renting out the single family and the multi-unit which are now fully occupied and making a profit! I intend to rent this new single family out (which is in excellent condition!) to raise the money needed to make the upgrades that I will personally like for me to move in next year as my own residence, and be able to write off all the upgrades! I intend to purchase several more properties this next year and I put an offer in last week on another home but haven't heard back yet. This is an awesome market to move foreward in and I for one have become excited again in my investing endeavors! Thank you Dean!

Market

Hello everybody,
dgadmin your words and the coaches are like...Monday thru Sunday! Just something you can count on.

Invest in Youself

For a second I was scare there

Dean, I was scare for a second there when that big guy just threw himself on you trying to retrieve the item. Glad you are our winner in the game of investment, both here and abroad. Go Dean! Go Dean! Go Dean. That's our kind of leader, he never let anyone get in his way. Good Luck Dean as well as my DG family. I guess this posting is in the wrong place, meant it to be in new Blog.

Sandra

More data

nstreet's picture

We are seeing trends for home builders, home-improvement retailers and home-furnishers up this week. This is good news for the housing market. This may show that there are possible improvements to real estate developments soon. As Dgadmin has posted the graphs of REITs you can point to sales also of a plateau / starting up swing of the real estate markets.

Thanks

GBU Ventures HQ's picture

this is good info

Follow up...

dgadmin's picture

To follow up on this, for the REIT index - often you want to see a strong double bottom to really show it is bouncing off a floor.

Since we don't have one here it is natural to think this could drop off again and test the lows one more time. However, based on all the data and feedback I have gone through I don't think we will test the lows again. Possible of course, I just don't think we will.

Given we have hit a short term range for the index a major economical event, good or bad, could send it in either direction. Assuming that everything remains basically the same I think it will climb through the resistance level (the upper green bar drawn on the graph), and that will solidify the prices for all forms of real estate.

As it stands now we have found a new level of support in the REIT index which is good news in the sense it indicates to us the market appears to be turning around, so houses can fetch us higher prices. The bad news is it tends to indicate that the window for the cheapest of the cheap deals is closing.

It is a double edge sword, but no worries, the foreclosures are abundant and easy picking still, but as big money starts to pour into the market more and more that changes.

My suggestion is if you aren't doing anything get going, like now... if you are making moves, make more.

We all know the market won't stay in dumps for ever, but the subtle signs are all pointing towards the time for a significant recovery is not far off... 3 months, 6 months, 12 months... who knows - the economic and credit factors will really dictate when, but the stage is set.

PS

dgadmin's picture

The reason I brought up the graph because I have been working on tool that combines a huge part of the research I do online into a single place. The graph was a small part of it and I decided I should note the current state of it here.

I can't say much right now... Dean has alluded to it on the calls. It will be a tool that is 100% FREE for all the people following Dean's blitz.

It will save you a lot of time when it comes to doing cursory research and decision making on your potential deals.

The other part of the tool, which I hope will be done for the launch with the analysis/research tool will be really important also... ok, I've probably said too much!

Anyways, keep an eye out. When it is launched, you won't miss it and I think it will be well received. I will try to leak more about it as it becomes available.

Follow Up

Hello everybody,
dgadmin your follow up is...Dead,Solid,Perfect!
I believe RE has a long way to go and it is important too remember...When that second hit may come.Great info site manager and i like all of the comments!

THANKS DEAN

eddietk1's picture

I TOOK A REALITY COURSE IN SCHOOL AND YOU SHOWED MY MORE

THANKS

There are still areas where the bounceback will take some time

With unemployment continuing to grow toward the 10% or higher mark I would say that we aren't out of the woods yet. Some areas of the country may be bouncing back a little bit, but like Indiana Joe said, you need to take a look at your investing market to determine what is going to happen.

Here in SW Florida the foreclosures are still at 1,800 per month but it is dropping a bit. Also unemployment here is already at about 12% so it will take some time in this market for the recovery to really hit.

i have good leads for investors

eddietk1's picture

i live in kingston ny anyone intrested e me please

EDWIN

dgadmin wrote:In the past

boi212's picture

dgadmin wrote:
In the past I've discussed many ways to do technical and fundamental analysis on the real estate market. One of those methods was using REITs (Real Estate Investment Trusts) as indicators for which way the market is moving.

Personally, my strategy is based on the idea that we have hit the bottom for many areas. Obviously there is plenty of room for some properties to go down some, and some to go up - but overall, this is my belief.

The anecdotal reports I've read across the country and analysis is what leads my to this, not a single number or source.

One of the interesting things I have observed is we have formed a new support level with the REIT index, further indicating the bottom has occurred. The index in is a trading range at the moment right now, which means things are limbo more or less - not really going up, not going down.

Three things can happen. It can remain in limbo, drop through support (and go down), break through resistance (and go up).

If the REIT index breaks through 530, I think it is sure sign that the overall sentiment will change to real estate is now a "value" investment by the many people. Already the smart money has moved back into real estate.

The point of this is twofold...

  1. Keep an eye on all indicators. No single indicator means nothing on its own. Just unemployment or foreclosure rates or any other indicator means nothing on its own. REIT can be a good indicator because it represents the sentiment of others which will push the market to a degree itself.
  2. The window to get the absolute bargin basement prices appears to be closing a little each day. If you are standing still or wasting time, get moving. If you need to expedite your learning or someone to keep you on track and help you, think about joining the Success Academy.


=)Thats why im off and running before Shaun Stenstrom from the academy calls me back. I as soooo excited and trying to put deals together to create some kinda $$ for the academy to show im worth getting qualified for the academy...

Is anyone investing in Omaha, other than me

I'm an REI in Omaha NE., is there anyone else here. I'm looking for networking opportunities. I also have props to wholesale.

email me at integrity_rei@****

thx
mike

How low the vacancy rate for the market?

nstreet wrote:
We are seeing trends for home builders, home-improvement retailers and home-furnishers up this week. This is good news for the housing market. This may show that there are possible improvements to real estate developments soon. As Dgadmin has posted the graphs of REITs you can point to sales also of a plateau / starting up swing of the real estate markets.

I understand that I need to look at LOCAL market indicators. One thing I am trying to understand is how low the vacancy rate need to be before it become a buy signal in income property. I see a lot of information on the rate but not how to understand this.

Carl

REIT

sboyd77's picture

Hi Dean,
I read in the Wall Street Journal last Sunday the
REIT is on the upswing in most of American markets.
Susan