The astute investor with the luxury of time should be looking past the current loan, foreclosure and home building situations and begin to focus on "what's next".

I am fortunate to have the advantage of being in several facets of the real estate business.

Here are some thoughts along with a few stock picks.

Increased stips (stipulations to receive loan consideration) including income, employment stability, cash on hand (20%), family stability, credit and credit scores are making it hard for many to secure a mortgage. FHA loans will be the best way to go for most mortgage products. And many will have to accept less of a home, especially a new home, which is not a bad thing since so many buyers purchased McMansions expecting appreciation of the property to bail them out of a poor financial decision. Homes are a place to live - not an investment. Thus, I am focusing my efforts on two areas: rental property that is clean and well-managed, and single family homes built for the lower middle class and middle class that are within reasonable budgetary constraints. Are there mortgage brokers and some banks still using questionable financing to structure mortgages? Emphatically, YES. But the word is out on foreclosed home angst, and more home buyers are becoming semi-educated to say no to loans that seem too good to be true. Foreclosed properties are generally trashed by their unlucky owners, and are usually of no interest to home buyers who prefer a home they can move into and live comfortably in immediately. Never, NEVER, have faith in one property appraisal. Get two appraisals or more. Assume that appraisers are still tight with those who want you to pay a premium price for property.

Rehab properties are being mass marketed by many of the same crowd who poorly rehabbed properties or worked over gullible real estate "investors" with no money down, cash out deals a few years ago. I see them everywhere I travel and get a laugh out of them pitching the same old snake oil to a new group of millionaires in waiting. Avoid them like the plague. Banks are sitting on their best properties knowing the market will likely turn in their favor sooner than most expect. The fact that banks or their shills buy back most of the foreclosed properties at auction says something about their plan. Real estate garbage is left for the bottom feeders to pick from. Sure, short sales, etc. are possible, but for the average home buyer somewhat complex tactics should not be attempted - especially with a pitch man hawking them.

Rentals are a great place to be now. With good, clean home buyers being shut out of the credit market, middle class and upscale rental properties bought right are a terrific investment. Same for commercial or office properties. Buying right is the key. And, making sure one understands that rental real estate is a not in the final analysis a brick and mortar business.