July 2016

We specialize in providing flexible short-term hard money and transactional loans for real estate projects. We also invest in equity of strong real estate projects with proper leverage and strong sponsors.

The housing market is suddenly hot again

Existing-home sales are up in May to the highest level in the last decade or so. Inventory supply levels continue to be low driving the median sales prices to the all-time high, per the data from the National Association of Realtors.

The median existing-home price is May of 2016 was up 4.7% from the last year. Unsold inventory was 4.7-month supply in May. 6-month supply is considered neutral. The shorter the supply the hotter is the market. Also, new supply is now lagging the demand. Builders cannot seem to deliver enough to meet the demand.

Cost of financing are down slightly in 2016 from 2015: the average rate for a 30-year, conventional, fixed-rate mortgage was 3.6% in May vs. 3.85% in 2015. Average time on the market is down to 32 days in May 2016 from 40 days in May 2015.

Interestingly enough, Zillow.com traffic is up 20% year-over-year in 2016. This is a strong leading indicator in demand growth, or least in the interest of browsing of listings. Mortgage pre-approvals are up as well. Listing Browsing and Mortgage Pre-approvals signal to strong demand expansion.

BREXIT just gave US Treasuries a significant boost as a flight to safety from European Union issues. US 10-year bond rate doped effectively from 1.7% to below 1.4% as the result. This is likely to push 30-year fixed rate mortgage rate down below 3.5%, which is a good news for the housing market.

We also had a strong jobs report on Friday July 8th, the US Economy created 287,000 jobs in June. As the result, US Stock Market continues its strong recovery from the initial fears of Brexit. S&P 500 is looking to break through its all times high, and the bulls are running again.

Furthermore, no move by FED is expected. “No news is a good news”. We are leveling off for a smooth Summer cruising with steady gains in real estate, calm markets, down to stead interest rates, and good picture on the US employment front.

Enjoy Your Summer, and stay cool in the Hot Weather.

Kind regards,
Mike Zlotnik
TF Management Group, LLC

Recent Deals Examples

  • Florida - Real Estate Deal
  • Largo, Florida
  • Purchase Price $68,775
  • Rehab $40,000
  • After repair value $140,000
  • Loan Amount $71,359
  • Funded June 24th, 2016

A Brief History of Fireworks


As early as 200 B.C., the Chinese began roasting bamboo to ward off evil. Bamboo pops noisily when heated due to its hollow air pockets.

Between 600 and 900 A.D., Chinese alchemists mixed saltpeter, charcoal, sulfur and other ingredients, yielding an early form of gunpowder, which produced an even louder bang.

Soon, paper tubes replaced bamboo, giving rise to firecrackers, then to rockets, which were converted for use in war. Different chemicals and fuses led to colorful explosions, fired to celebrate military victories.

In medieval England, firework assistants were called “green men” because they wore caps of leaves to protect their heads from sparks. Green men doubled as jesters to both entertain and protect the crowd, much like rodeo clowns today. It was dangerous work, with many green men dying or being injured by bad detonations.

Free Consumer Report

How to Compete Against Multiple Offers & Win!

Few things are more frustrating than to make offer after offer on homes you like, only to be beat out by competing offers time and again. Here are a few insider secrets about how offers get accepted in competing offer situations.

Read Free Consumer Report

“In any given moment we have two options: To step forward into growth or to step back into safety.” ~Abraham Maslow


Which New Habit Could Transform a Person Practically Overnight?

What one habit could transform someone’s life immediately? Here are some answers to that question when asked on social media.

  • Count to 10 before reacting.
  • Commit to 10% of a goal. If your goal is to exercise for 30 minutes, commit to 3 minutes. If you want to save 10% of your income, save 1%. We tend to make goals beyond what we’re actually willing to do. Set an ideal goal, then scale back on your actions until ready for more.
  • Ask how you contributed to any problem that happens to you…and find the place where you could have/should have done something different.
  • Delay gratification. Food, TV, phone, etc. Get used to saying, “I’m not going do that right now; I’m going to do this instead.”
  • Live debt-free, or as close to it as possible. Choose to save money for a big purchase, rather than putting it on credit. If you must put it on credit, delay all future purchases until you’ve paid it off.
  • The 10 Test: Will this matter in 10 days? In 10 months? In 10 years?
  • Raise your integrity level, both to yourself and others…don’t lie about little things, don’t fudge things, don’t cheat in small ways.
  • Give 30 minutes of undivided attention to your family when you get home from work. Listen.

What one habit would you suggest to someone looking for success in life?


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Google Blows $1 Billion, Just Playing Around

pic-5In just one financial quarter this year, Google “wasted” close to a billion dollars. But they weren’t spending it on new search algorithms. Instead, parent company, Alphabet, was spending it on “moonshot” ideas that may or may not pay off in the future.

The futuristic projects include seawater gas, internet-beaming balloons, and solar-powered contact lenses. According to Astro Teller, head of Google X labs (great name!), “We try to steer X to be ‘responsibly irresponsible’ as we develop new products.”

In this way, Alphabet is following in the footsteps of old-time technology companies who used to devote significant budget to new and exploratory ideas, not simply incremental ideas that would make them more money in the short term, as many companies do today.

Those efforts in the past played a role in creating some of the 20th century’s most significant innovations. For instance, Bell Labs invented the transistor. And Xerox pioneered the graphical user interface (GUI) that allows us to navigate our computers visually, rather than typing in coded commands.


Just for Fun: How Fast Can I Learn?

A martial arts student went to his teacher and declared that he wanted to learn as fast as possible. He asked the teacher how long it would take to become a master. The teacher replied: “Ten years.”

But the student was impatient and dissatisfied with the teacher’s answer. “I want to go faster than that. If I work very hard, practice 10 hours or more per day, how long will it take me then?”
The teacher replied: “Twenty years.”

The student bowed and said, “Then let’s go at your pace, master.”


Help for Slowing Alzheimer’s

Scientists searching for causes of and cures for Alzheimer’s disease may have discovered a source of protection. A Scandinavian study followed 271 people ages 65-79 for seven years. They periodically tested blood levels for a marker of vitamin B12, as well as an amino acid called homocysteine.

At the beginning of the study, none of the participants showed signs of dementia. Over the following seven years, 17 of the 271 participants were diagnosed with Alzheimer’s. The researchers found that study subjects with more homocysteine had a 16% higher risk of developing the disease, while those with more B12 (which is associated with lower levels of homocysteine) had a 2% reduced risk of Alzheimer’s.

The indications seem to support the use of vitamin B12 in slowing the onset of Alzheimer’s. Vitamin B12 can be found in eggs, fish, poultry, and other meats, and is best consumed through a balanced diet, rather than through
vitamin supplements.

My Advice

“Am I approved or only pre-approved?”

In the past (before 2006), borrowers could make offers on houses with nothing more than a note from their lender stating they’ve been pre-qualified. That meant the lender spoke to them and thought they were a pretty good bet. Later, lenders began to pre-approve borrowers. That meant they’d gone beyond a friendly chat and actually pulled the buyer’s credit report and looked at their loan application. But a pre-approval was still just another way to say that someone looked like a pretty good bet.

Fast forward to today, and many borrowers are being encouraged to be fully approved before going house-hunting. A full approval means that the lender has already sent documentation (tax returns, etc.) to the underwriting institution, and has confirmed that a buyer will get the loan…as long as nothing changes at the last minute and they can find a house. The real advantage to the borrower is that being fully approved makes them almost as good as a cash buyer.

Call me for the name of a mortgage advisor who will help you get your approval letter in hand.