For about two years now, the U.S. housing market has been slowing with both new and existing home sales experiencing a tremendous downturn. Compounding/driving the issue, the sub-prime mortgage debacle has over-leveraged homeowners unable or unwilling to pay their increasing house payment when their variable rate mortgages "reset". As property values decline, homeowners find themselves with no equity and no escape: unable to pay their mortgage, unable to refinance. The result is a foreclosure rate not seen in recent memory. Realtytrac statistics show the 2nd quarter 2008 foreclosure rate up 121% vs. 2007, and continuing to rise. The report also shows that one in every 171 U.S. households received a foreclosure filing during the quarter.

When lenders complete the foreclosure process and take possession of these properties, they become REOs (Real Estate Owned).  The accelerated rise of REO inventory has put pressure on lenders to liquidate these homes quickly.  Far from being able to obtain market value, many of these REO properties are in need of moderate to substantial rehabilitation due to vacancy, vandalism, disrepair, etc. Therefore, lenders are willing/forced to sell at deep discounts in this soft market.   Therein lies the opportunity.  For real estate investors to thrive in this turbulent market they must:  buy the right properties, the right way, at the right price, in the right markets, and with the right team in place. At M2REST, we have structured our business model to thrive, currently buying, rehabbing, and selling profitable deals in ideally positioned markets…. So there you go, not sure that was “brief”, but we hope helpful.

At M2REST we research, and have access to experts who research, U.S. real estate markets exhaustively to determine ideal investment markets. These ideal markets are analyzed based on characteristics such as: average earnings per household, affordability, median home price, median home price change, housing trends such as new starts and existing home sales, foreclosure statistics, days on market, job growth, unemployment data, employment sector diversification and trends, growth oriented city/county policies, market value stabilization and future trend predictions, rent vs. own demographics, rental market trends and statistics, and so on.  Oftentimes, we find that our home market (and maybe yours) is not one of these ideal markets. Our conclusion: it is more prudent/profitable to invest in markets with strong fundamentals based on solid research and a strong, on the ground, “Power Team” versus taking our chances in our local market based mostly on proximity and familiarity.

We do extensive research to determine the markets we consider ideal for investing. We further sub-divide our select cities into ideal zip codes, and ideal neighborhoods.

Currently, we are buying and selling properties in the following hand selected markets:

It absolutely can be… but the risk can be managed. Much of the “risk” in any long distance or out of state real estate investing comes from the “unknowns”: not knowing the area, having no professional team on the ground, not being able to visit the property, not meeting the potential buyers or renters, not knowing the home values or the market rents, not knowing the state specific legalities, etc. M2REST can be your one stop shop for answers to all the above. We offer turnkey real estate investment services… when you buy from us to get our entire “Power Team”, and access to our step-by-step process from purchase through exit strategy. Not only are our deals some of the best you will find, but with every deal we add our personal touch. Give us a try, buy one property from us, and let’s begin working together to meet your financial goals.

At M2REST, we’ve identified 7 keys we use to determine if we buy a property or not:

At M2REST we prefer residential properties, which include single-family homes, duplexes, triplexes and 4-plexes, for several reasons:

Within each select market, we assemble a group of local professionals we call our “Power Team”.  This team includes licensed General Contractors, buying and selling real estate agents and brokers, home inspectors, property managers, project managers, mortgage and hard money lenders, real estate attorneys, leasing agents, appraisers, title companies, and insurance brokers.  Each member is thoroughly screened and determined to be qualified, experienced, and willing to help our clients maximize each real estate investment decision. We use extensively detailed contracts on every deal, with every power team member. And finally, we require all repair/renovation to be permitted and to code, performed by local, actively licensed contractors. Your Power Team can make or break your deal, whether you’re investing locally or out of state. If you don’t have a Power Team in place, there is a shortcut: Buy access to one with M2REST. When you buy a property from M2REST, you put our “Power Team” to work toward your investment goals

To decide if we buy a property at M2REST, we run extensive analysis on every property/deal we consider. Our proprietary spreadsheets calculate traditional ratios: Net Operating Income (NOI), CAP rate, Debt Service Coverage Ratio (DSCR), Breakeven, 1% rule, and so on. Further, we run ARV (After Repair Value) calculations using comparable sales and income approaches, and if appropriate, pre-/post-tax cash flow calculations for each exit scenario. For each calculation, we set minimum target levels and run comparative analysis with multiple scenarios considering: financing, deal structure, offer price, and renovation variances. Will we buy the property? How will we need to structure the deal to make it work for all parties involved? For our part, we answer these questions by blending our financial statistics/projections and a ‘feel’ for the market we’re considering, timing/trends, perceived risks, strategic advantages of the deal, opportunity cost, our investor partners’ goals, etc. Ultimately, our calculations define our financial goals for each deal, while remaining flexible on how to structure the deal to reach those goals.

At M2REST, we are long-term investors, building our reputation one deal at a time. Short-term benefits from cutting corners pale in comparison to the long-term benefits of quality renovations completed on time, and in budget.

We always pay our contractors on time, as agreed. We spend a little more on our renovations, pulling permits for all necessary repairs and renovations, using licensed General Contractors and quality building products which cost a little more up front, but we believe pay strong dividends as the project ages (whether we still own it, or not). Ultimately, we focus on continuing to build our reputation as quality investors.

Generally, this market is perfect for “buy and hold” investors, who want to strengthen their portfolios with solid properties and are willing/capable of buying discounted properties, holding them as rentals with scheduled positive cash flow for 2-5 years, and then reselling these properties as the market strengthens. Can you ‘flip’ properties? Absolutely, but the optimal exit strategy will be based on the specific characteristics of the property plus market conditions. At M2REST, we believe the key is property selection, buying the right property in the right location ideally set up for the targeted exit strategy. Forcing an exit strategy rarely works well, and usually leads to an unsatisfying and under-performing deal.

Absolutely not. After we have a property under contract, we begin to market the property to investors interested in “taking over” our position. The sales price will vary, and generally increases as the project ages. And you can rest assured that every property we buy is one we are willing to keep. We don’t just sell off our marginal properties, every M2REST home is a keeper or we won’t buy it

For most investors, overcoming the hesitancy to “pull the trigger” is a major obstacle. We continue to buy houses in this real estate market. The foreclosure and distressed property inventory is producing the greatest discounts we may see in our lifetimes. Buying right, and in the right market is the key, and the time to act is NOW. Waiting until the market settles, means waiting until public sentiment swings more positively toward real estate, and with it will come higher purchase prices. For the investor, that’s the time we want to be selling, not buying.

At M2REST, we offer all our properties for purchase at any time. To this end, we actively search for homeowners, investors who want positive cash flow/instant equity, and others interested in purchasing our properties singularly, or in packages.

Immediately after securing the purchase contract for a property, we release the property for sale to our investor clients. The fee to M2REST is always included in the purchase price, varies from deal to deal, and generally increases as the project ages and our investment of time and money increases. All our properties have scheduled positive cash flow, and built-in equity when you buy. Generally, our properties are available for purchase in the following progression:

	“Assignment”: Before closing, for a fee, the investor “takes over” (is assigned) our position and closes the property as defined by the purchase contract. In some states we do a “double close” to facilitate this.
	After Closing, Before Rehab:  Sometimes investors prefer to use their own rehab crews, or have a different scope of project in mind for the property. Normally, our rehabs start within a day or two of closing, so the window here is tight.
	After Rehab: On some occasions, investors want a professionally rehabbed property, but prefer the property to be vacant.  These investors value our use of licensed General Contractors and permitted work, but want to manage the properties themselves or use their own property managers.
	Turnkey Rental:  Investors seeking a hassle-free method to build their portfolios choose this option.  Turnkey properties are those that have been professionally rehabbed, rented to a systematically screened, and qualified, tenant who has signed a one-year lease by our professional property management company.  This company then retains management control of the property for our turnkey investors, ensuring oversight of the investment until the investor chooses to sell.

Absolutely, we work with investors in many different ways. Call us at 866-694-5257 to discuss how M2REST can best serve your investment goals. Or, if you prefer, e-mail us at Info at M2REST dot com.

We are always open and interested in creating “win-win” deals with investor partners. As full time real estate investors, we bring our “Power Team” of professionals, and our commitment to structuring clear investment agreements that result in mutually beneficial deals. If you have an available deal or package of deals, call us at M2REST, we want to hear about it.

Our founders at M2REST are a sister and brother team, Meghna and Malhar Bhagat. M2 comes from the first letter of each first name, and REST stands for: Real Estate Solutions Team.

At M2REST, we are committed to the success of every one of our investors. To facilitate that success, we:

1. Determine the optimal markets to invest… (more)

2. Compete for the best-valued REO properties available in those markets.. (more)

3. Only sell properties with built-in equity.

4. Only sell properties with positive cash flow.

5. Have an established team of professionals available to our investors in each select market…(more)

6. Offer choices: wholesale, rent-ready, and turnkey (tenant-in-place) properties available…(more)