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May 2010 - The Occasional Newsletter. Why is it occasional? -

"It's occasional because I can't stick to a regular schedule!!!" - Lance

Contents: 1. 2. 4. 4. 5.

Greetings! The Woodlands Market News Homes for sale An interesting Investment that pays very well! Commercial Real Estate

1. Greetings! Well... it's that time of the month again... time to review the market and to see where it is we're going! But... first, a few new developments: Firstly, I've gained a "working partner" in the commercial arena - Enrique Rosales. Enrique moved to The Woodlands a number of years ago from Mexico. As there are so many people moving from Mexico to The Woodlands area, I thought it only made sense for me to partner up with someone from there! So... I had our website guy develop a new banner that now shows both Enrique & myself as well as our first contact phone number based out of Mexico City!!! The commercial work we've done so far has worked well so I thought we might as well put a similar banner on the residential site.... it generates a ton of traffic so we'll see how it works out. Secondly.... yes, we have a new magazine style layout!!! I came across this pretty amazing site called www.issuu.com - you produce your "magazine" & they publish it! Free! Well... you can go for the upgrades and I might do that but right now it's our first issue and we'll see how it works out. To view the pages of the magazine, hover your mouse over the area you want to read and it will maneuver the page so you can view it. It takes a few minutes to get used to it. They great thing is... your newsletter/magazine is available to so many more people. Anyway... let me know what you think of the new style.

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2. The Woodlands Market Review. We had another good month in April! But... not outperforming as much as we did the previous month i.e. March 2010. At least we beat last year's April by just under 5% but we were behind April 2008 - our benchmark year until at least August 2008. After that the "recession" was announced and then it kind of went downhill pretty fast from then on. Last month I introduced the "pending deals" statistic... it's interesting that out of 180 deals that were pending at the time I did the newsletter, only 128 closed. So... just over 70%. If we project forward a 70% closed ratio for the current number of deals pending, we're looking at about 175 closed deals in May 2010. That's definitely way ahead of last year's May. That's pointing at about a 30% improvement on 2009 numbers.

Summary Highlights: - we sold more homes in April 2010 than in April 2009: 128 vs 122 (not a major improvement) - Median Prices (probably most accurate barometer of pricing) are marginally up on 2009 but marginally down on 2008 - Sales Year To Date (YTD) are ahead almost 12% vs 2009 but still behind 13.53% vs 2008 at the same stage So... we're moving in the right direction but we're not quite there yet! - The absorption rate (how long it will take for all active listings to sell at the rate they're selling) is showing that it will take 4.9 months to sell all 625 homes on the market. That's technically pointing to a "seller's

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market". If the May numbers are as high as it looks like they might be, the "seller's market" can only improve. This is to be expected at this time of year. Advice to buyers: Even thought it's technically a "seller's market", you are still able to negotiate.... if you find something you like though, don't mess around... make an offer earlier rather than later and start negotiating sooner. In this market, you snooze you lose!!! The longer you wait, the more chance there is of another buyer coming in to make an offer and then you'll be competing on the deal which never makes for the best price. Also... the are many things to consider when buying, a possible higher purchase price can be negated by a lower mortgage rate.... just today I see that mortgage rates are at their lowest for the year. Check this out: MORTGAGE RATES HIT LOWEST LEVELS OF THE YEAR <---- click here for story! Advice to sellers: If you were thinking of selling your home this year, now is when the busy season kicks off. If you were waiting for someone to say "when"... let me help you out - "when"! But... remember this, many other sellers are also putting their home on the market. So, it's a competitive situation out there. To stand out your property has to be in the best shape you can get it in and the price has to be competitive. Buyers are shopping and not just buying the first home they see. 3. A FEW OF OUR HOMES FOR SALE! (see clickable link below)

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VIEW MLS INFO, PHOTOS & VIRTUAL TOURS http://tinyurl.com/248t7qs <--- CLICK HERE.

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COMMERCIAL REAL ESTATE. Well, the Lance & Enrique team has taken shape in the last few months and it's going to be a great team! We recently held our first joint seminar at "The Woodlands Chamber of Commerce". It was titled "Seminario para invertir en bienes raices comerciales". It was aimed at successful business owner Spanish-speaking immigrants. We've found that when they arrive, they buy a home which is great but then they look for something to do and they either need to buy a business or buy a commercial investment that will provide them with the income they need. We have the skills to help! In depth property analysis backed by the ability to evaluate an investment from a potential business angle as well. But... besides our services, we are well connected to a number of other crucial service providers: inspectors, surveyors, attorneys, cpa's, architects, etc. The seminar was a massive success!!! Over 40 people attended. I'm still not sure what the big draw-card was.... the food that was excellently catered by Jorge from Caffe di Fiore or the seminar content? I would personally have gone with the food! We had some feedback which we've taken to heart: - It should have been in Spanish!!! - we'll fix that next time. - I felt the gap for lunch was too short. Next time we'll make it at least 30 minutes for lunch. - I think I might have covered too many topics in too short a time? Next time we might take one segment of investment and handle it in far more detail. Will have to think about that a bit more. - Next time we'll have someone signing everyone in and giving everyone a name badge... that would have helped everyone make more connections. But... even though we made a number of "first-timer" mistakes, I think it was still a good session and some new friends were made! We're planning another seminar possibly some time in July 2010 but we'll keep you posted on dates/times.

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COMMERCIAL DEALS THIS IS A BRAND NEW DEAL - WE'RE STILL IN THE PROCESS OF GATHERING ALL THE INFORMATION. But... it's a mobile home park on 10 acres of land. There are 24 mobile home sites. They lease the spaces for the mobile homes. Rent averages $200 to $225 per site. That's between $4800 & $5400 income per month, or between $57,600 & $64,800 per year. The owner is asking for $500,000.00. Make an offer... he's ready to negotiate! This is a pretty straightforward deal.... it's a land deal that's paying for itself while the town grows towards it. Once I have all the current income & costs I'll be able to work out the cap rate on this deal but it looks like it's going to be in the region of at least a 10% cap rate. NNN DEALS - tenant pays rent + insurance(N) + maintenance(N) + property tax(N) We also have access to a number of NNN deals. I've just come across a package of 54 Dollar Generals which are spread across a number of states including Texas. $700K INVESTMENT WANTED - WHEN BANKS DON'T WANT TO PLAY YOU WIN!!

Note the subtle play on "when banks compete you win"? One of my clients is looking for an investor (or investors - minimum $50k) to fund expansion of a new development close to The Woodlands. I've gone to look at the development... really beautiful homes are being built there and they're selling well. The location is an excellent long-term location sitting directly in the path of future growth. The owner of the development will pay 15% simple interest!!! on the money for a period of three years after which your money will be returned. In addition, you will have the opportunity to share in 15% of the project's profits. So.... a fairly substantial possible return. So... if you have some money sitting in a cd that's about to roll over... consider this alternative for a higher rate of return. Investment is backed by land. Please give me a call for more details if you're interested. Well... that's it for this month. Give me a call if you'd like to meet up.... our favorite meeting places are Cafe Express in Market Street of Caffe di Fiore at the end of Woodlands Parkway. Have a great month!

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An Occasional Newsletter - May 2010