Saturday, January 03, 2009

U.S. commercial real estate taking a hit in 2009 -- tax liens potentially increasing

With this economic recession, we all know that residential properties across the nation were struggling; however, there was one piece of good news -- commercial real estate continued to slowly grow or at the least, remain stagnant. But it is looking like commercial real estate is no longer going to be the protected from the storm.

According to Marcus & Millichap Real Estate Investment Services and National Real Estate Investor magazine, roughly 1,000 large commercial properties were already in default last year and the worst is yet to come! There's another 3,700 large commercial properties going belly up, potentially in 2009. That is roughly an $80 billion hit.

This is a direct consequence of restaurant chains closing, retail businesses cutting costs, and stopping expansions, and in some cases like Office Depot, Circuit City, Movie Gallery, and others -- closing stores.

But what does this mean to you the Investing Without Losing tax lien investor? You may start seeing...which a few years ago was liens on viable commercial property! Those that are backed by the bank are usually paid out in time, but some do slip through the cracks and get converted into tax deeds, which investors can buy cheaply.

While the prospect of having additional foreclosures is bad news for the current state that we are in, we should continue to look on the bright side. It provides others, those that saved and are properly leveraged, the ability to buy at discount and help communities recoup their much needed tax dollars for roads and other public services by investing in tax liens.

Thanks, -Don

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