Deaton Investment Real Estate & The Wake County Apartment Association

Tuesday, December 15, 2009

A gift for Habitat for Humanity - A plug for a parnter

Atlantic BT Technologies recently launched a new web site for Habitat for Humanity of Wake County. Atlantic BT, also the web site design firm for Deaton Investment Real Estate, provided this site design as a gift in kind. Read the full release. The site is remarkeable and Atlantic BT should be commended for their work.

A few years ago when we set out to re-design our web site at Deaton we interviewed multiple companies and Atlantic BT quickly proved to be the best equipped for the task. They did a fabulous job and their user management tools and service have made our experience with them nothing short of extraordinary. Knowing that they also have a passion to give back to the community makes us even more excited and proud to call them a business partner.

For more information on how Atlantic BT can help you with your web site and internet marketing visit

Wednesday, December 9, 2009

Is the Triangle Harvesting a New Berry?

Just when the Research Triangle Park is about to take a huge blow with the closing of the Sony Ericsson office and the subsequent loss of 400+ jobs, there MIGHT be a new player rolling into town. And a big player at that. Reports indicate Research in Motion (RIM) the company that produces BlackBerry phones is interview for positions and is considering establishing a new office in the area. The News and Observer has the full story.

Not only would this mean more jobs now, but it support RTP's brand efforts to remain a hotspot for technology and innovation. Maybe this posting would have been more symbolic had I drafted it on my BlackBerry.

Wednesday, November 25, 2009

Want to Secure More Revenue?

During these challenging times, many landlords are looking for ways to secure more revenue. A recent poll would suggest a good place to start is to secure the property. 96% of respondents said that crime rates influence their decision of where to rent. Additionally, amenities that increase a tenant's feeling of security are likely to warrant a higher rent. Examples would be security systems, guards on the property, security cameras and access gates. To get more ideas and details you can read more here.
Even more elementary, for smaller properties, better window and door locks and common area lights are an inexpensive way to help your tenants sleep better at night and improve your bottom line.

Thursday, November 12, 2009

Concession Anyone?

No, not the concession stand at the ballgame or the circus. Although, the apartment rental market has turned into a bit of a circus recently. My reference to concessions concerns the FREE rent and discounts landlords are shelling out to attract renters right now. The Triangle vacancy rate sits at about 9.5% as of September 2009 and rents have declined more than 1% or 2% in some markets over the last 12 months. The News & Observer ran a feature on this today.

It seems like a natural market cycle with the unemployment rate rising and the overall softening we've seen in the economy. Are YOU lowering rents or working harded to keep units occupied?

Thursday, November 5, 2009

Home Buyer Tax Credit Extended and Expanded

The $8,000 home buyer tax credit set to expire on November 30, 2009 has been given new life. This credit will now be extended until April 30, 2010 and expanded to include a $6,500 credit to buyers who have lived in their current home five or more years.

There are a few limitations, but this should help sales through the seasonally slow winter months. However, we could debate the long-term benefits and/or consequences.

Wednesday, July 15, 2009

Change isn't easy and often not wanted

The buildings formerly known as University Apartments on Chapel Hill Road in Durham have been sold to a group from Alabama that specializes in student housing. Their plans are to renovate and upgrade the property to add value to the $3.3 million they paid for the property in May of 2009. However, residents and the community are meeting the effort with opposition because the increased rents will force many of the people to move. While the displacement of tenants is unfortunate lets hope the new owner is able to do what they want, with the property THEY OWN, without much interference.

Thursday, July 9, 2009

NAR Economist coming to town

The Triangle Commercial Association of Realtors has line up George Ratiu for the July showcase. He will be speaking about the current state of the commercial real estate market and give us his economic outlook for the industry. The event will be July 23rd in Cary. For more information click here.

Friday, June 12, 2009

Raleigh Keeps on Growing

According to the Triangle Business Journal the population in the Raleigh area will more than double between now and 2025. This projected growth pace surpasses estimated growth of any other metro area during that same time. Read all the details here.

Monday, June 1, 2009

Roots of the Financial Meltdown Exposed

These four charts are very telling. Perhaps the most shocking is the last chart showing the government's response to bring us out of this mess. Anyone think the fundamentals of capitalism are crumbling?

Tuesday, April 28, 2009

At the Bottom?

Financial advisor Jeff Link has provided a chart of the DJIA ending April of 2009 and one ending in 1932. I encourage you to have a look and a read, they show a very similar pattern. Maybe we have started to turn the corner?

Monday, April 27, 2009

No Bull

A local investor just introduced me to John T. Reed and I can't believe I have not heard of this guy before. Mr. Reed has been a real estate investor, property manager and broker. He has succeeded by focusing on the basics, NOT HYPE and offers to share his experiences with others through his web site, newsletter and books. I encourage everyone to check out what he has to say, especially his tips on Detecting a Real Estate B.S. Artist.

The fact I learned about him via referral and not a late-night infomercial validates everything he says.

Thursday, April 16, 2009

Payment Protection not only for new cars, now rent!

One of the biggest and best residential management companies in the U.S., Riverstone Residential, is now offering tenants the opportunity to enroll in an "insurance" plan that will pay their rent for 2 months if they lose their job. Residents can enroll in the Pink Slip Protection program for less than $10/month.

With clear parallels to the automotive manufactures, the plan should attractive new residents and help retain existing ones by offering them some peace of mind in a very difficult job market.

Thursday, March 19, 2009

Early April Fools from the Fed

Many folks, myself included, thought the Fed's announcement to buy Mortgage Bonds and Treasuries would cause interest rates to drop. Well that didn't happen. Want to know why? Mortgage expert Rich Paravella with Equity Services ( offers some insight:

"There was a large announcement yesterday that the Fed was stepping in to purchase Agency bonds. This was to bring interest rates down to the lowest rates ever - Oops - Didn't happen. Below is article explaining why. If you read no further, remember this: Don't always believe what you hear. Email me for a real world explanation or status of the mortgage environment.

"Big news hitting the wires yesterday afternoon, as the Fed made a blockbuster announcement that sent Mortgage Bonds into rally mode. The Federal Reserve announced that over the course of 2009, they will purchase an additional $750B of Mortgage Backed Securities in an effort to help shore up the housing market and keep home loan rates low. On the announcement, Mortgage Bonds exploded higher, leaving prices within whiskers of the best levels ever.

However, as we stated in yesterday's Alert to Float: Their actions may keep a lid on rates, but not necessarily push them dramatically lower. And due to the issue we've also discussed of lenders still working at max capacity, they are very likely not going to pass all the gains through to our rate sheets, as we are already hearing this morning. The good news is that perhaps this will help lenders feel more comfortable staffing up a bit, as this purchase program will certainly keep rates from moving significantly higher any time soon - and this will also give time for the new 105% refinance plan to work as well. Bottom line - although the media is already spinning it differently, this is still not a time for clients to stay on the fence, hoping and waiting for lower rates. Home loan rates remain within inches of all-time historic lows, but may not necessarily move significantly lower based on this purchasing plan - waiting is a very risky move.""

Monday, March 9, 2009

Trickle-Down Economics

A recent story from the News and Observer (which just announced layoffs) described the increased pressure many banks are applying to builders. This particular article highlights SunTrust and their demands for repayment or refinancing from one builder in order to avoid foreclosing on his homes. In the past, builders could refinance homes that stayed on the market longer than expected with a simple request. Now banks like SunTrust are increasing interest rates, requiring more equity in the deal or denying refinancing request altogether.

This lack of liquidity often puts the builder in a situation where he has to CHOOSE who gets paid. If he pays the bank, his contractors might not get paid, forcing them into financial harship. If he pays the contractor, the bank might foreclose and everyone could lose.

Basically, without the ability to refinance, the builder isn't the only one that stands to lose. Anyone who might have poursed resourced into the project could be stuck with unpaid debts. In fact, this trickle-down scenario has already caused many contractors to file bankruptcy.

Wednesday, March 4, 2009

Another TAX from the City

I know your budget is already tight, but if own rental property within the City of Raleigh you now have another expense, a.k.a tax to pay. As of March 1, 2009 all owners of rental property inside the Raleigh city limits must pay to register their property with the city. This ordinance was basically passed to fund the Probationary Rental Occupancy Permit (PROP) inspections team. However, the proceeds collected will far exceed these costs and thus be transfer to the general operating budget for the city.

The city wants you to believe they are trying to punish bad landlords and 'clean up' our neighborhoods, but the execution of this goal has been terrible. What the city has done is impose burdensome restrictions and fees on good landlords that must be passed on to the tenants in order for the owner's business to remain profitable. You could make the argument that the city wants to eliminate rental housing and renters altogether.

Tuesday, February 24, 2009

Have you been living under a rock?

The financial meltdown and gloomy outlook has some people wishing they could go hide away in a cave. Well for one family, the recession and lack of financing is forcing them out of their 17,000-square-foot, subterranean home. After purchasing the home in 2004 with a 50% down payment and a 50% loan from the seller for 5 years, Curt Sleeper cannot find a source to refinance because there are NO comparables for the property and no banks want to take the risk. Now he has turned to E-Bay to sell or find a lender and the response has been unreal. Let's hope they can find a way to stay in the 'home' since they just gave birth to their third child (in the cave).

Thursday, February 19, 2009

More to lose than just Earnest Money

Some people believe if they sign a contract to buy a piece of property and then decide to back out of the deal, the worst result would be a loss of their earnest money. This is not true. While every deal and contract is different, any party that defaults on a contract can be pursued for additional damages, assuming the other party can prove those damages.

In fact, one condo developer in Tennessee is taking aim at several buyers that backed out of purchase contracts. The developer ended up selling the units for significantly less than the original contract price and is asking the former contract holders to pay the difference, or be sued. It should be interesting to see the results.

Monday, February 9, 2009

Four Is The Limit No More

Fannie Mae announced a new policy on February 6, 2009, to allow investors and second home buyers to own up to 10 financed properties. The new policy takes effect on March 1, 2009, and replaces the current 4-property limit. The restriction applies to the total number of financed properties, not just to the number sold to Fannie Mae.

Investor and second home borrowers that seek to own between 5 and 10 financed properties must meet additional eligibility requirements.

-Borrowers must have a credit score of at least 720. The maximum loan-to-value ratio is 70% or 75%, depending on specified criteria.
-Borrowers may not have any history of bankruptcy or foreclosure in the past 7 years, or any mortgage delinquencies of 30 days or greater within the past 12 months. Reserve and other requirements also apply.

Tuesday, February 3, 2009

WCAA Meeting - Thursday

If you are interested in education and networking that relates to investing in apartments I recommend checking out the Wake Count Apartment Association.
The group meets the first Thursday of very month to help provide it's membership with information to improve efficiency and profitability of operating apartments. Our next meeting will be this Thursday, 2/5/09 and the guest speaker will be Raleigh City Council Member Philip Isley. For meeting details, visit

Thursday, January 29, 2009

An update from Harvard

Some really smart people have issed a new policy paper to encourage our elected officials to recognize and understand the differences between single-family and multifamily financing. Harvard University's Joint Center for Housing Studies and the National Multi Housing Council cite a need to keep multihousing financing affordable so that landlords can meet the needs of gorwing demand for rentals during the economic downturn. If our policy makers fail to prepare for this, financing for multifamily properties could get even harder than it is today. This is something to keep an eye on as regulators make decisions that affect Fannie, Freddie and FHA loan portfolios.

Thursday, January 22, 2009

A little humble pie

While the Triangle continues to fare far better than many cities across the country, I would encourage every landlord to be creative in your methods of keeping renters. In other metro areas the shift has taken place to a renters market. The article has a few ideas, but remember it's easier and typically cheaper to keep a good tenant than to find a new one.

Friday, January 9, 2009

Not the Lucky number: 7.2%

Employment data was released today, Friday, January 9, 2009. Most people probably are not surprised to hear that unemployment continued to rise through the end of 2008. However, a national unemployment rate at 7.2% represents the highest it has been in 16 years. The unemployment rate in the Triangle is still in the low 6% range, but nonetheless it's higher than just a few months ago. That said, we hear vacancies are starting to increase, prompting owners to lower rents. If you are sitting on a vacancy now is probably not the time to be greedy.