Increase In Distressed Properties Seen As Catalyst In Investment Club Growth

Hawaii Real Estate Investors president and founder Paul V. Xavier reports that membership in his investment club and attendance at the company’s weekly seminars have both increased substantially over the past six months.

“There are now 242 people in the club, which held its first meeting in February 2002. For many years it seemed to have plateaued at 200, but there has been a big surge since last year. Attendance at our meetings at the Japanese Cultural Center, which we hold on the first Thursday of every month at 6:30 p.m., has grown from approximately 130 to 150.

“I believe more and more people with uncommitted financial resources, whether the amount is small or large, are recognizing real estate as their best option in the current marketplace. Real estate is a tangible asset…people feel more in control with a real estate investment than with stocks, which have to be continually monitored,” Xavier said.

“And once a stock goes bad, such as Enron, for example, that money is gone forever. With a real estate investment, you can almost always recoup something if the market goes down.

“Right now is a great time to invest because interest rates remain low and short sales and fore-closures represent some real bargains, particularly in some parts of the country. Our strategy is to locate undervalued properties and properties in distress, which we personally review with our students and investment groups on buying tours.”

HREI is currently targeting Indianapolis, Indiana and Dayton, Ohio where the company liaisons with local investment clubs and works with a team consisting of attorneys, lenders, Realtors, insurance agents, and property managers.

The back-up services and research provided by HREI is included in the tour fee of $1,500, which covers hotel, transfers, local transportation, and some meals, but not the flight cost. The next buying trip is scheduled for April 28 to May 2.

The group, which is limited to ten investors, plans to review 40 to 50 properties, mostly single family homes in both cities, and identify the best buys. If group members wish to invest, they can work with their own real estate agents and lenders. Commercial properties are also targeted for club members with more substantial assets.

Detailed information on the Indianapolis-Dayton trip will be provided at the HREI April 1 meeting at the Japanese Cultural Center.

Xavier’s new book, “Answering the ‘What Ifs’ in Real Estate,” was recently published by Aviva Publishing in Lake Placid, New York.