Buying foreclosures at the courthouse in Georgia

[James Paisley]

Happy new year! With deals harder to find in this inflated market I'm interested in the courthouse buying process. When I lived in Florida 6 years ago I did a couple deals and had some luck, but GA is much different. Would love to shadow someone and learn in the metro Atlanta area. Be happy to get coffee, buy lunch, etc.

JP

[Joel Owens]

Luckily I do not deal with stupid money in the commercial space as much but occasionally you run into it.

These days you can't mess around period. Deals move fast. In my world that is 3,5,10 million dollar properties.

It amazes me how many people are worth 3,5,10,20 million these days. Amazing amounts of capital out there chasing deals. I have my full time office person doing the mailers and calling all day on the phone to owners.

Local guys complain last year they could find a 9 cap. 1031 buyers from other states that sold at a 4 cap are amazed to get an 8 cap on a commercial property. It's all perspective. I went to the courthouse steps before but that has been a waste.

You have to find a seller off market that does not have the pulse of the market. They know things are improving but do not know how hot markets are so price at a good price level to sell.

On the flips side I have a client with a large commercial project and the cap rates in the area keep compressing  which is great for us. Depends on which side of the coin you are sitting on.

Timing of the market is key. 3 to 4 years ago markets were frozen. People not educated on cycles were too afraid to make a move. Educated investors were gobbling stuff up knowing a recovery was starting. Now the real estate market many are buying based on the fear of loss in a hot market.

There are still great deals out there but you have to stick to your numbers and underwriting. I would rather look at 50 deals all year to buy 4 at the right price then just to be buying feeling like I am pushing volume. When you do that the bad deals cancel out the good ones for the portfolio and you are spinning your wheels.