FLORIDA Housing Collapse Just Got WORSE (50% in Fort Myers?); Deal or Dud & Catch-Up!

Next week October 11 will be Joni's and mine 2-year anniversary. Joni bought me a Washburn electric?guitar as an anniversary?present, I was shocked and speechless. Just a week before we had gone to a pawn shop, and I was playing it and honestly thought about buying it and didn't. The entire drive back I was going back in forth in my head going back to buy it. It absolutely?sounds amazing, and it is now my new favorite?guitar. My daughter had homecoming this past Saturday. My Son and I watched a movie called?Taxi Driver starring Robert DeNiro, my opinion it was horrible. Don't waste your time watching this movie. I was disappointed. I did a little bit of concrete?work getting ready for the wintery death that's coming.

I want to talk a little bit about IRR and ROI. IRR is the internal rate of return (IRR) is a metric used in financial analysis to estimate the profitability of potential investments. It's typically used with NPV i.e., Net Present Value. ROI is the Rate on Investment or CoC (Cash on Cash) return. With buying these notes I look at ROI and IRR and a multitude of other factors i.e. value of the property, crime rate of the area, taxes, collateral?file, and pay history just to name a few.

?When evaluating a deal as I look at the ROI and IRR. I put more focus on the IRR value because?it gives a more accurate evaluation of the investment for performing?assets. The reason why is that?the payments on these mortgages are going down over time and the IRR accounts for this where the ROI or CoC is just a snapshot in time.

?Below is a screenshot of IRRs on 11 assets, they range from 12% to 59%. Why so high? This is due to?9 out of the 11 assets will need to be foreclosed, the other 2 being loan modifications (marked in yellow). The other 9 assets will have an ROI between 30% to 35%. But wait you just said the IRR has more weight than the ROI it does on performing assets the 9 are non-performing assets thus the ROI holds more weight. Now if I can get these assets performing then those IRR would be accurate but due to the exit?strategy?of foreclosure, I put more weight on the ROI.

?I know, I know this is too much math. I get it but I'm a geek and I love numbers and formulas. Math and formulas were one of the big reasons why I went to the University of Cincinnati for Electrical Engineering I love math. I love when my kids come to me with a math problem?because I let my geekiness shine???

The result of the Hurricane will be that fewer - and Homebuyers - move to Florida. Particularly Southwest Florida. Additionally - there will likely be an exodus of people out of Cape Coral and Fort Myers. Similar to what occurred in Panama City Beach after Hurricane Michael in 2018.

?Home Price Data comes from Zillow: https://www.zillow.com/research/data/

Inventory Data from Realtor.com: https://www.realtor.com/research/data/

?Cheaper Home Prices will likely occur. But interestingly, Rents are likely to increase, given that there will be a big swath of people looking for new housing after their homes were destroyed by the Hurricane. On a positive note, the high level of Home Building in markets like Naples, Lakeland, Orlando, and Fort Myers means that Florida is well positioned to rebuild quickly from Hurricane Ian.

?But perhaps the biggest impact of the Hurricane is that the "Florida Delusion" is shattered. The idea that was built during the pandemic among Homebuyers and Real Estate Investors was that Florida was the best place to be. This is no longer the case after Hurricane Ian and the result will be a big drop in Migration into the state overall.

?Perhaps on the level experienced during the mid-2000s, when according to the US Census Bureau reported that positive Migration into Florida declined from +533k in 2005 to 80k in 2009.

Check out the video below:

As always I pray you have a great week, reach out to me, and we can discuss a few ways you can earn?above-average returns?on your money secured by real estate!?

Have a great day and God bless!