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August 2006
October 2006
March 2007
September 2007
October 2007
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Over the past few months there has been an increase in the number of commercial projects that have required a variance for zoning, i.e. a retail space turned bakery. Some of these projects have been a complete disaster, resulting in lost money and time. Last month the City of Easton had their zoning codes reworked. The new code is set to match the goals set out for the cities redevelopment. If you’re considering investing in the city you should meet with the following people first.
1. Becky Bradly Easton’s City Planner
2. Steve Glickman, an architect who helped write Easton’s new zoning codes. Steve can help you attain a survey to establish boundaries for setback/code issues. He can also help you get a site plan from an engineering firm which you need to submit to the city for approval.
3. After the site plan is submitted you need to go through the zoning office for approval. If you require a variance or you should contact Danny Coehen of Jacobs & Jacobs. Danny is considered the guru of zoning issues for Easton.
Keep in mind you need permits for almost everything in Easton. From demolition to signage. If you do use a contractor you are still responsible for pulling permits. In other words the city will fine you not your contractors if a proper permit is not pulled on a job.
posted by nurtherwood at 5:36 AM
Last night I was watching TV with my wife. As we were watching, the reporter stated that the recession is over. They were basing their assessment on the stock markets recent rise. There are a few factors that many of the market annalists have missed.
Inflation and deflation have been two factors that the fed has been desperately fighting over the last few years. Many annalists have stated that inflation has been relatively low over the past few years. However, the one factor that has historically caused double digit inflation has been a shortage in energy (oil). From the Great Depression to the 1970’s oil crisis. An increase cost in energy will cause inflation to rise. Oil has been on a steady climb for the last few years. Some are now saying that oil could rise to 200 barrel. Combine this with a dollar that has been falling in value for the last 12 years and the outlook is grim.
An additional factor enters into to play when exogenous money enters a banking system; it sparks off a process of credit creation. This has been what we have been experiencing since 2001. The amount of money entering the banking system over the past few years has been enormous. When monetary authorities fail to absorb the inflow by issuing sufficient amount of bonds to soak up the addional liquidity, we enter a phase of rapid expansion, which leads to the emergence of an economic bubble. If you study Asian economic crisis of both Japan and Thailand you will see the exact fact pattern that we are experiencing.
Real estate has always been a solid investment through inflationary periods. Rental returns tend to keep pace with inflation and usually rise accordingly. Gold and precious metal have also been solid investment alternatives, posting double digit returns during the majority of the recession. Large cap funds, cash, and bonds tend to be the most vulnerable to economic swings.
posted by nurtherwood at 10:16 AM
Easton has not been immune to the fallout of the sub-prime lending. 6.7% of all sub-prime loans are in default or foreclosure. In comparison traditional fixed rate programs have only a .5% default rate. 53% of all foreclosures have been subprime loans.
Subprime loans tend to have a rate that is 0.1% to 0.6% higher than the prime rate. Although the additional percentage may seem small, for mortgages and other large loans, this translates to thousands of dollars worth of additional interest payments.
The bulk of the investment properties in Easton have been purchased with these programs over the past 4 years. A 4 unit(or less, non commercial) could of easily been purchased for a 0% down program with a qualified buyer. Today these programs have been completely dissolved.
Commercial units down town have been unaffected by this fallout since there lending standards have not changed.
posted by nurtherwood at 10:34 AM
The City of Easton does not allow investors convert or increase the number of units in a building. Currenlty, the city is trying to reduce the number of multi-units. Owner occupancy is the goal, with the idea that an owner will take much better care of a building than a tenant.
posted by nurtherwood at 12:28 PM
Lehigh Valley Update:
Median Price $206.000.00
Average Sale Price $233.000.00
Avg. days on market 43
No. of new listings 1533
Total Sales 833
sales Pending 633
Residential Real Estate Distribution:
Under $70,000 15
$70,000 - $90,000 39
$90,001 - $100,000 23
$100,001 -$120,000 48
$120,001 - $140,000 70
$140,001 - $160,000 63
$160,001 - $200,000 147
$200,001 - $250,000 145
$250,001 - $500,000 248
Over $500,000 35
posted by nurtherwood at 5:15 AM
With prices at all time highs in the Easton area, investors are looking for alternative ways to purchase real estate. Some real estate investors are purchasing through a Tenancies in Common. This is a form of ownership and not an LLC. It does not provide legal protection either. What a Tenancies in Common does allow is for investors to pool their resources to buy property. Each investor would own a share of the property. Investors can sell their share at any time and even use the tax evading 1031 exchange if needed. Investors retain their right to sell at any time. TIC’s allow investors to go their separate ways at any time. As an individual owner you can also take a fractional amount of depreciation from the property when tax season rolls around.
posted by nurtherwood at 10:10 AM
Purchasing investment property in Easton can be challenging yet profitable. There are a few numbers you must consider prior to an investment. Tenured investors in Easton tend to look at numbers such as the Cap Rate, Gross Rent Multiplier, Cash on Cash and Cost Per Square Foot or they may simply look at the internal rate of return. Don’t expect your Realtor to be able to calculate these numbers. The majority of Realtors do not own investment property and many do not sell them, so you will have to do your homework. But most of all don’t rely on the MLS cut sheets you are given. You want proof of income and reviewing existing leases and the prior years tax returns on the property can help validate the properties income. If you are not experienced with investment properties you may want to purchase a property that has 4 units or less. Typically in Easton any building over 4 units or if there is commercial space in the building that accounts for over 25% of the total square footage will require you to get a commercial loan (20% down, higher interest rate).
posted by nurtherwood at 9:22 AM
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Troy Pressens
MBA, M.Ed, e-PRO, CIPS
Licensed in PA & NJ, Long & Foster Realtors
3101 Emrick Blvd, Suite 10, Bethlehem, PA 18040
Direct 610-438-2239 l
Office 610-865-7776
Cell 908-398-4961 l
Fax 610-865-3121
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All contents © copyright 2006 Invest In Easton All rights
reserved.
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