A Huge Housing Bargain, But Not For You

http://www.thestreet.com/story/11224917/1/a-huge-housing-bargain--but-no...

This column by Roger Arnold originally appeared on RealMoney on Aug. 11.

This article emphasizes the massive fraud and corruption that exists in our government. The federal government, using our money, is going to transfer billions of dollars of foreclosed homes to a select few investment funds and corporate entities.

The transfer has not taken place yet, and there are a few more steps for the government to take before the transfer will be complete, but it won't take long. Once the transfer is complete, there could be a massive influx of property either for rental or for sale coming into the marketplace. This will obviously have a major impact on prices. The problem is, we don't know when, and we don't know to what extent it will occur. There will be some markets that will be more affected than others.

As investors, we need to pay attention to the political workings here, and be prepared to factor the effects into our investment equations, or be prepared to profit from the opportunities that will undoubtedly arise from this situation.

Remember, to a novice investor, the fact that a glut of properties will soon be released is a sure sign of doom. Prices must surely fall, and the real estate market should be avoided at all costs. This is a very mistaken thought process. Just like in the stock market, profits can be made when the prices are going up, or down. The key is to know what is happening so you can play within those parameters.

For example, if this becomes public knowledge, (more so than just the release of this article...) the general public selling properties will surely think the same thing, and will be much more negotiable in their asking prices. Another key to remember is that there is always a variable between the PERCEIVED reality and ACTUAL reality, and sometimes it is this variable that we can profit from. For example, if some of the public believes that prices are bound to drop, they may drop their own prices far more than is actually warranted by the volume of properties released. That is a huge profit potential.

The main key here, is that the market is changing rapidly, and you have to be aware of your surroundings if you are to succeed. Any negative sounding news will always be accompanied by a corresponding opportunity. It is our job as investors to be aware of the potential problems, and figure out the opportunities that will arise by our ability to solve those problems.

THAT.... is the American way. Solve problems, work hard, and you will be paid handsomely for it. Don't fear, but be aware and wise.

Happy Hunting!!