Brian Davison's Alternative Investment Times

The Pitfalls of High Fractionalized Investing
A fractionalized Trust Deed is a loan that has many investors who pooled their money for the total principle balance for the borrower.  Typically the interest of the investor is based on what their dollar amount is expressed as a percentage of the total loan amount. A. The more investors and the smaller any one investors stake in a given Trust Deed the less control those investors have. B. When a Trust Deed does go back to the investors those that have more capital to commit end up carrying the cost such as foreclosure filings, attorneys, maintenance, management, taxes and insurance to name a few for those that do not have the funds or will not pay.  In many real life cases; the investors with more to lose (higher principal investments) are more compelled to contribute to keep the asset in good condition. C. Voting is often controlled...
Can Mortgage Brokers Be a Pitfall of Trust Deed/Mortgage Investing?
Most Trust Deed investing for individual investors is facilitated through a Mortgage Broker.  For the borrower; the Mortgage Broker advertises that he has money to lend and negotiates the terms of the loan, is to conduct due diligence on the borrower and the property.  For the investor; the Mortgage Broker advertises that he has investment opportunities for the money of investors in properties.  Simply put; the Mortgage Broker is simply acting as a middleman between those that have the money and those that want the money. A successful Trust Deed Broker is typically every effective at marketing and sales as they must consistently cater to two groups at all times; the borrower and the investors to create a transaction so they can earn their fees.  However in most cases; at the core; they are not true Real Estate guys. The interest in the transaction usually begins and...
Introduction to Equity Value Investing: EVI 2.0
Equity value investing is the acquisition of fixed assets with significant equity on acquisition that can be quickly converted to cash flowing entities. This significant market equity on acquisition will allow for an additional layer of principle security against market dips or stagnation. EVI execution historically acquires assets at 31% (YR2012) of current value. In the past (2008-2012) these assets were treated as short term transactions (flips or EVI 1.0) as the underlying market fundamentals had not stabilized enough to access if a short term dislocation was part of a longer term value bottom for a buy and hold. Why EVI? Since the financial crash a new paradigm has emerged; fewer Americans are becoming homeowners for a variety of reasons. Of the reasons there are fewer homeowners today, most notable to an asset investor today is that there is not ability for traditional sub-prime lending based on...
Four Years into the Real Estate Crisis – What is Driving the New Renter Class?
There are many factors that are driving the new renter class, but it can be broken down into forced pragmatism vs. the American dream.  Here are 5 factors that are driving rentals versus ownership: 1.  Real cost of home ownership: With no home price appreciation prospective buyers analyze all cost of ownership; property taxes, HOA dues, maintenance / repair costs. Notable: property taxes will be under pressure as municipalities look to raise rates to balance stressed budgets. Transaction costs; typically overlooked and take 10% off any arms length transaction - a price of mobility or cashing out. 2.  Demographic effects: Baby boomer households have begun the shift to empty nesters, downsizing, smaller vacation home buyers. Gen Y is growing pressing the need for entry level housing, this is an 80M- group whose job growth was 3x’s the national average in 2010 and the average house- hold size is declining...