The Norris Group Trust Deeds Blog

Trust Deed Investment News and Information

What’s the typical property type I would lend on in a trust deed investment with The Norris Group?

The Norris Group currently lends almost exclusively on single family homes that have one to four units. The reason why is rather important and one every trust deed investor should understand and consider no matter who they are investing with. It’s all about timing and risk.

The Norris Group spends a great deal of time researching California market trends. Bruce Norris has a great track record for predicting long-term California market trends. Why is that important? Because we invest our own money in the market as well the money of our trust deed investors every day. Understanding the cycles tells us when to be aggressive, when to be conservative, what inventory is the safest, and which activity will be the safest moving forward.

Our market research tells us that in a down market the strongest market is the first-time home buyer category. It makes perfect sense when you think about it. Since homes aren’t increasing in value as rapidly as they were in 2003-2007, there’s not as much of a move up market. People aren’t being able to extract equity from their home to move up to bigger and better homes. Actually, downsizing is a trend, especially in economically unsure times.

We knew this cycle was coming and weren’t very aggressive in 2007 and 2008. In 2009 through now, most of our loans have been on properties where the typical buyer would be moving from a rental to first-time home ownership. Our loans range from $40,000 to $350,000 depending on the market. Markets like San Bernardino and Riverside Counties have seen prices take a huge hit. However, the opportunity is incredible for these first-time home buyers that are being able to purchase a home for less of a payment than rent! That’s hard to believe but check the MLS and see for yourself.

Even more expensive markets like Los Angeles, San Diego, and Orange County have seen some price hits but there’s still a strong first-time home buyer market. We like funding homes that fall under the FHA loan limit as it’s much easier for these buyers to get financing in the current credit crunch. Standard banks aren’t taking as much risk so we steer far away from the million dollar home category.

Another great reason why we like this inventory is there are several exit strategies for the real estate investor. The investor can choose to buy, fix, and sell or they could buy, fix, and rent. Having more than one option that works makes for safer investments.

When the market returns, The Norris Group will consider other funding opportunities like building, land, and construction loans. For the time being, it’s too early to discuss these types of activities.

For more information on our turst deed investmetns, call our office at 951-780-5856 and request our free infomration kit or visit our:

Trust Deed Investment Video |  Trust Deed Investment E-Book |  Trust Deed Investment Frequently Asked Questions

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