more value-added items at higher price points. The ac- cess to inventory is the same issue for the flipper to find properties at the proper price point,” she said. Flips accounted for 7.4 percent of total home sales in the St. Louis metro area during the fourth quarter of 2018, down eight percent from a year ago, according to ATTOM. Distressed sales accounted for 17.9 percent of all home sales during the first quarter of 2019, a 17 per- cent yearly decline. Although third party foreclosure auction sales were up in the first quarter compared to a year earlier, both REO sales and short sales were markedly down on a annual basis. The number of properties with foreclosure filings were down 7.5 percent between the first quarters of 2019 and 2018. “Flippers don’t flip rental properties, they flip to own- er occupant buyers. There are off-market deals, but the competition makes it a lot harder to find properties with a decent return,” she noted. “The good news for flippers is that it’s still a seller’s market, so they’re able to sell for a higher price. The risk is lower than it used to be. The demand on the buyer side is still there and the profit is there.” One trend Kastner is seeing in the market is land- lords who have owned rental properties for five years or longer getting their tenants out so they can update their buildings and sell them.
St. Louis is an interesting market. In the last three years the number of out-of-town investors has exponentially grown. Now investors have to be a lot more patient. Inventory is in extremely short supply on the investment side. Even two years ago investors were flocking here because we have lower prices than the east and west coasts.”
for more than three years since they are have realized a significant amount of appreciation, in some cases double what they bought it for. “Most of my clients weren’t in it for the appreciation. If you’re a multi-family buyer, you’re buying in St. Louis City. There’s a high concentration of multi-family here,” she said. “For people who buy single family, the major- ity of them buy in north county. A lot of the single family homes in the city are more than 100 years old.” Because St. Louis is still a seller’s market, Kastner does warn investors not to expect the bargain deals of the past. “Saint Louis still has a great investment opportunity for most people outside of the area. It is still relatively cheap and very stable on the rental side. There’s a lot of security and a low entry point as far as price so your money goes further here. However, you’re not going to find things like they were in the old days,” she said. Joel Cone is a freelance business writer based in Southern California. His articles have appeared in California Real Estate magazine, Real Estate Southern California, OC Metro, GlobeSt. com, Foreclosure News Report, the Los Angeles Daily Journal and the Smarter Investor blog for U.S. News & World Report, as well as many other print and online publications. Contact him at firstname.lastname@example.org.
ST. LOUIS, MISSOURI
“Most of them don’t want to get out of investing, but they are smart enough to see the market trends.
They’re stockpiling cash and will be able to buy deals,” she said. With a high concen- tration of multi-family buildings – especially duplexes and four- plexes – Kastner is a buy-and-hold inves- tor who purchases multi-family buildings, and then renovates them to get a higher rent. In a market with such
tight inventory, finding properties takes some
creativity and initiative. As an investor, Kastner said she looks for owners who have held a property
july 2019 31
Made with FlippingBook Online newsletter