real estate

Real Estate Lead Generation

2008-11-19T09:03:00.001-08:00

Online virtual tours are the wave of the future for real estate advertising. They allow prospective buyers to view a home 24 hours a day, attract attention to your listings, and even appeal to prospective clients and home sellers looking for a real estate agent willing to go the extra mile.

So, how do you create a virtual tour, and what goes into making a good one? For the answers to these questions and more, keep reading.

Capturing and Creating a Virtual Tour

In the past, real estate agents who wanted to create virtual tours had to go through expensive graphic design and video editing firms. Today, there are a number of inexpensive software programs and even free online services that will create the virtual tour for you if you provide the photos.

To capture the photos, you'll need a digital camera and a tripod. By capturing each shot and rotating the camera approximately 15 to 20 degrees between each shot, you'll have enough photos to create an accurate and compelling virtual tour.

Then, you can use any of the following services or products to stitch together your tour:

FlyInside.Com (http://www.flyinside.com)

Totally free and easy to use, this simple website allows you to create a virtual tour using their basic online wizard. You can add your own branding for a small, additional fee.

TourWeaver (http://www.easypano.com)

This software is expensive ($200 to $700, depending on the edition), but it creates fantastic virtual tours that also allow you to create clickable hot spots right on the tour. So, for example, you can add roll-over pop-up windows to the kitchen to tell prospective buyers about the new gas hood range or a hot spot in the bathroom to highlight the spa shower.

MapWing.Com (http://www.mapwing.com)

MapWing allows you to create free, basic virtual tours which can then be shared on the web. You can upgrade for a more customizable, branded look.

Tips For Shooting a Virtual Tour

Try to get at least two or three hours in the home with no other activities for your photo session. You want your shots to look great and you'll need time and privacy to get it that way.

When shooting the outside the house, remove all the cars from the driveway, shovel or sweep the walkways, remove the garbage cans, and tidy up the garden. Also, try to shoot the home on a sunny day. The appearance on the shots should be as attractive as possible.

When shooting the inside, try to get as much natural light into the home as you can, and turn on all the interior lights. Then, turn off all the TVs, appliances, and ceiling fans. Next, declutter the property by clearing countertops, making the beds, tucking away clutter and straightening any errant items.

Once you're ready to shoot, focus on steady shots that are most flattering but also clearly visible, and take each shot four or five times to ensure a good shot.

Take your time to ensure your shots are clear and attractive. High quality virtual tours are a great selling tool.

Bed Bugs Can Squash Real Estate Deals

2008-11-16T12:12:00.000-08:00

An ancient human scourge has returned to cause panic among home and property owners, home buyers and realtors. Bed bugs have invaded every state in the U.S. and reports of infestations have increased exponentially nationwide over the past few years. In a national survey of pest control companies conducted by noted bed bug authority Michael Potter for Pest Management Professional, Potter found, “A whopping 91% of respondents reported their organizations had encountered bed bug infestations in the past two years. Only 37% said they encountered bed bugs more than 5 years ago.”

Until a few years ago, most pest control companies said it was unusual to receive even one or two calls a year about bed bugs. Since 2004, however, bed bug complaints have grown exponentially with pest control companies nationwide now averaging between 10 and 50 calls a week. In major metropolitan areas, some companies are fielding 100 or more bed bug complaints each week. Some experts are predicting that 2008 will be the Year of the Bed Bug. Cindy Mannes, spokesperson for the National Pest Management Association, said bed bugs have become a serious problem in every state, noting, “There are some who call it the pest of the 21st century.”

Bed bugs are an equal opportunity pest. Infestations have occurred across the country in the tony co-ops of the rich and famous, in fashionable condominiums, in luxury apartments and in upscale suburban homes. Contrary to popular belief, bed bugs are not caused by filth or dirt. Like lice and fleas, bed bugs are creatures of convenience. A nuisance insect, they are not known to carry disease, but they can cause considerable discomfort, both mental and physical.

All but eradicated in the U.S. following World War II, the banning of powerful DDT-based pesticides, coupled with increased international travel, has brought about a nationwide resurgence of the annoying insect. Potter, an urban entomologist at the University of Kentucky, calls bed bugs the pre-eminent household pest in the U.S., on a par with cockroaches and rats. “This is one serious issue,” he recently told the New York Times. “This will be the pest of the 21st century – no questions about it.”

If you’re buying a house or looking for a new condo or apartment, take to heart the old adage Buyer Beware. You may be moving into a home that has been invaded by bed bugs. Most states require home sellers to provide buyers with an accurate statement disclosing the property’s condition, including pest infestations. However, there are loopholes that should serve as a red flag to home buyers and their realtors.

Most real estate disclosure statements are fairly broad and do not specifically ask about bed bug infestations. If any pest disclosure is specified, it’s likely to be termites. Because bed bugs haven’t been a problem in the United States for so many decades, few current state or municipal codes address them specifically. In many states, sellers can choose not to fill out the disclosure statement and instead pay a penalty which is credited to the buyer. For sellers with a bed bug problem, a several hundred dollar penalty may seem an acceptable price for making the sale.

Buyers and realtors should be aware that real estate disclosure laws that apply to home sales often don’t apply to co-op and condo owners. Before you buy, check with the local building and health departments to find out what the regulations are in your area. Although some states are now considering adding specific bed bug regulations to their realty laws, at this point common law is generally on the side of the seller. As real estate attorney Edward Sumber of New York told the New York Times, “Under the doctrine of caveat emptor — let the buyer beware — the seller has no affirmative obligation to reveal circumstances about the apartment to the buyer.”

However, disclosure laws in most states require the seller to answer honestly if specifically asked whether his home or apartment has been infected by bed bugs or other pests. Additionally, real estate brokers are usually obligated to reveal a bed bug problem to the buyer if they know about it. Unfortunately, in most states sellers are not required to tell their real estate brokers about bed bug problems. Essentially, that means buyers must rely on the integrity of sellers and landlords anxious to make a sale.

Many buyers shopping for a new home, apartment or condominium are now hiring a pest control company with an expertise in bed bug elimination to inspect the property before they buy. Some realtors are recommending that sellers have their homes inspected for bed bugs before putting them on the market as both a reassurance and inducement to buyers.

What are bed bugs?

Evolved from bird and bat nest parasites, Climex lectaularius, the common bed bug, is a tiny nocturnal insect that hides in dark crevices during the day and feeds on human blood during the night. Their oval bodies are flattened and wingless and a light to reddish-brown in color. Adult bed bugs are 1/4 to 3/8 inch long or about the size of an apple seed. Before feeding, the bed bugs are as flat as paper, becoming dark red and bloated with blood as they feed, much like a tick. As they puncture the skin to feed -- usually for 3 to 10 minutes -- they eject an anesthetic that can cause an allergic reaction and the symptomatic itchy, red welts that bedevil their hosts. However, welts may take a day or two to develop and not all bed bug sufferers react to their bites, which can delay detection.

A female bed bug can produce up to 500 eggs during its average one-year lifespan, laying about 5 eggs per day. Difficult to detect without magnification, the eggs are whitish, pear-shaped and about the size of a pinhead. The female lays her sticky eggs in bedding and carpets or cements them into cracks and crevices near the bed to ensure a food source when the nymphs hatch. Nymphs, which are lighter in color and look like slightly smaller adults, hatch in 4 to 12 days and begin to feed immediately. Bed bugs progress through five nymphal stages, molting after each stage. The whitish carapaces they shed are a telltale sign of bed bug infestation. It takes 5 to 8 weeks for nymphs to reach maturity. Since several generations of bed bugs can be produced in a year, all stages of growth can be found in an infested room.

Bed bugs feed every 3 to 5 days and must feed at least once to develop to the next stage and to reproduce. They often void while feeding, leaving telltale rusty or tarry spots on sheets and in hiding places. Bed bugs can survive for 1 to 7 months without a blood meal and have been known to live in an abandoned house for as long as a year. They give off a distinctive musty, sweet odor often likened to ripe red raspberries or coriander.

Bed bugs will readily travel 10 to 15 feet to feed but have been observed traveling more than 100 feet from their established harborage to feed on a host. Once established, infestations can spread rapidly to adjoining rooms or units through crawl spaces, wall voids and electrical and plumbing conduits. Adept hitchhikers, bed bugs can easily enter your home on clothing, bedding, luggage, used furniture, cardboard boxes, etc. They can be brought home from a hotel stay or by sitting in a car, cab, bus, train or plane recently inhabited by an infested person.

What to look for

Bed bugs may be tiny but they leave telltale traces. Look most closely near beds and in bedrooms where bed bugs feed. Look for these telltale signs of bed bug activity:

A heavily infested room may have a characteristic musty or sweet odor like the scent of fresh red raspberries or coriander; however, the odor may not be obvious.

Look for active, crawling bugs on bed linens, carpet and furniture near the bed.

Look for dark fecal and blood stains on bed linens; carpets and carpet welting; and in the seams, creases, tufts and folds of mattresses and box springs.

You should also look for fecal smears or pea-sized pearly egg deposits behind headboards; along baseboards and door and window casings; around electrical plates; in plaster cracks; and under loose wallpaper, paintings and posters.

Look for whitish nymph molts and old exoskeletons under area rugs, at the edges of carpets, and in under-the-bed storage containers.

Beware of bats in the attic or eaves. Quite often bed bugs feeding on bats in the attic of a house will migrate to the living area in search of an easier food source, humans.

Buyer beware!

Bites, odor and voiding smears are indicators of a bed bug problem. However, these insects often go undetected when symptoms are not obvious. Bed bugs are also easily confused with other nuisance bugs like carpet beetles, bird and rodent mites, shiny spider beetles, parasitic wasps, even lint by the more paranoid, making definitive diagnosis a job for bed bug experts.

Before you buy a new home, ask the owner if there has ever been a bed bug problem. In co-ops, condos, apartments and any multi-unit residence, ask the property owner whether bed bugs have been reported in any unit. Before they buy, many home buyers are now requiring a pest inspection by a bed bug expert in addition to the traditional home inspection. When it’s buyer beware, it makes sense to protect yourself.

Safe and long term real estate investment in Malaysia

2008-11-14T01:38:00.000-08:00

Investing in a piece of land is not that easy, especially overseas. For investing in real estate market, one should be knowledgeable about the country/area that he/she would like to invest in. One should have good research skills and also be well aware of the market because sometimes small investments will help you earn more and heavy investments will make you lose whatever you have earned. An investor should be aware of the market value and be able to make wise judgments. But most of all, the investor should know what he wants to do with the investment in future.

For investment within Asia, truly Malaysia is the finest place offering the best. The changes in taxation and legislation have recently made Malaysia as an attractive prospect and now Malaysia is quickly becoming a hotspot for local and foreign investment with many western multinational’s setting up offices there.

Malaysia entertains both serious and casual investors because it has a lot to offer from the business point of view as well as holiday makers who want Malaysia to be there second home, (MM2H.) For serious investors Malaysia is a safe ground in order to earn long term rental incomes and is in demand for both residential and commercial property.

For investors who have the buying power and are willing to invest but don’t have enough knowledge about investing and are not well aware of the market, they can always walk up to a reliable source for consultancy who can guide them on investing their money on the right thing at the right time.

Future Track Consulting! Yes, Future Track Consulting is Pakistan's premier consulting firm offering a one-stop solution through well planned strategies to individuals , businesses and investors looking for an alternate destination closer to home, Malaysia. Future Track Consulting also offers consultancy services including but, not limited to, business setup and feasibility, foreign company formation, corporate services, bookkeeping, legal advisory, trade licenses, work permit and visa consultancy, Malaysia My Second Home (MM2H), cultural orientation, housing and relocation, banking and finance, property buying and management, as well as investment opportunities in Malaysia.

U.S. Real Estate Forecast

2008-11-11T23:51:00.001-08:00

On any given day, people can easily find articles and news stories describing an impending bust of the so-called real estate bubble. Despite this gloomy prediction, many experts believe that the recent slowdown in housing will be a gradual and modest readjustment rather than sharp bust or decline. These experts believe that factors that lead to a sharp decline in the real estate market are just not present in the current economic outlook. In fact, a recent study by the Joint Center for Housing Studies at Harvard University noted that "despite the current cool-down, the long-term outlook for housing is bright."

The rise and fall of the real estate market is subject to the forces of supply and demand, and these factors point to stable and positive growth in the real estate segment.

SUPPLY FACTORS

Limited supply of real estate makes it scarce and usually pushes home prices up. In contrast, an oversupply of real estate tends to put downward pressure on home prices. Despite the current slow down in the real estate market, factors that impact limited supply favor continued growth in the real estate market. Some of these factors include:

1. Builders have readjusted growth plans in regions that have an oversupply of new housing. Over time, any excess inventory is likely to be depleted and equilibrium achieved between supply and demand.

2. The availability of land in certain regions, as well land use regulations and associated compliance costs will continue to restrict the supply of new homes.

DEMAND FACTORS:

Housing located in regions with high demand tend to be more expensive than homes in regions with low demand. Factors that impact the demand for housing suggests a favorable long-term housing outlook. Some of these factors include:

1. No current evidence of significant and across-the-board job losses; forecasts of relatively low unemployment rates.

2. Long-term increased demand for second homes, vacation homes and senior housing by baby boomers.

3. Long-term increased demand for entry-level homes by the children of baby boomers.

4. Long-term increased demand for entry-level homes by immigrants.

5. Long-term increased demand for entry-level homes by second-generation Americans.

6. Forecasts that the outflows and inflows of the U.S. population in and out different regions will not significantly impact the overall U.S. real estate housing market.

7. Relative stability in interest rates.

8. Continued stability in long-term home appreciation rates.

9. Overall, rising rate of wealth across all age groups.

SUMMARY

In summary, strong household growth, overall rising incomes and wealth, and a stable economy all bode well for continued long-term growth in the real estate market. While the overall housing outlook is favorable, affordability will continue to be a challenge, as wages, especially in the lower income levels, have not kept up with housing costs.

Real Estate Value and the Profit Margin

2008-11-10T01:33:00.001-08:00

Making money in real estate is a dream that millions of people have. Few will actually see that dream become a reality. Why is that? Well the fact is that it takes a person with a strong will and a stiff upper lip to make it in this cutthroat business. You cannot be the kind of person that is given to allowing others to take what you have or want. To make the money that you need you have to be willing to stand up and make it happen.

The profitability of investing in real estate depends on the market as much as it does the person doing the investing. The general rule is that you have to be smart and lucky at the same time. Knowing what to buy, when to buy it and how much to pay for it all have to ring in your ears at every potential investment. Lacking even one of these components can put you at risk for serious losses in the financial department.

This is key when you are looking to get a better grasp on real estate value and what affect it can have on your profit margin. Basically you are having to do a risk assessment before you make every deal. This can be time consuming if you are not knowledgeable in this area. However, with a few key tips and a bit of advice you can make the right choice. So below we have provided a few of these tips.

The Value and Price Gap

Learning to bridge the gap between value and price is vital to your success. You can sit there all day long and read appraisals and still not come away with any better idea as to how much you should pay for a property. This is due to the fact that appraisals are based on more factors then you need. They are giving a value that is used by the mortgage companies to determine how much can be loaned. The price is actually what a person or company would pay. Knowing how to fall in between those when buying is how you make a profit.

Risk

There is also the idea of risk that has to be considered. Any real estate deal is going to be risky but some more than others. You have to learn how to properly assess the risk and determine whether it is too high for you to make the investment. While high risk ventures do tend to be more valuable in the long run, there is the chance that you could fail. As such you have to be sure that you are prepared when establishing real estate value and the risk involved.

Long Term

As a person that is looking to make an investment in your future you have to see that true real estate value is based on the long term. Short term factors do exist but in most cases you have to assess the value on a term that is far longer. The more that you have to sit on the property the more the value could change, either for the better or for the worse.

Increase the Real Estate Value of Your Home

2008-11-10T01:32:00.000-08:00

If you are planning on selling your home, there are some simple things that you can do to drastically increase the amount of money you will receive from it. Remember that most people that will look at your home will also look at comparable homes in your neighborhood. Top real estate value can only be achieved for your home if it stands out from all the rest of the similar homes in the neighborhood.

Real Estate Value – The 60 Second And 60% Rule

A home has 60 seconds to make a lasting impression on the potential buyer, so make it a positive one. Experts agree that 40% of the buying decision is determined when the potential buyer first drives up and gets a glimpse of the house from the curb. Another 20% of the buying decision is made when the potential buyer first enters the house; in other words 60% of the decision to buy or not to buy the house has been made right after the prospective buyer enters the house. That should tell you that 60% of your time preparing the house for sale should be concentrated in the front of the house and in the area as you just enter the house

Most potential buyers are looking to get excellent value for real estate they invest in and are looking for an uncluttered home with a free-flowing floor plan, and bright, clean interior.

Real Estate Value – Tip Top Condition

Make sure you pay special attention to the front yard: cut and trim the grass, trim trees and shrubs, plant colorful flowers, and paint the exterior of the house, if needed.

Real Estate Value – Remove Clutter

It is recommended that you open up all tight traffic areas and remove some furniture from the home to make it look larger. Change the light bulbs to the maximum wattage allowed, and open all drapes, shutters, and shades. If you are going to repaint the interior of the house then use white, this gives the potential buyer a canvas to work with.

Real Estate Value – Appeal To The Buyer’s Senses

You must make sure there are no offensive odors in the house because nothing turns off a potential buyer like a bad smell. If you are going to have an open house, then turn off the TV, turn on some soft music, and make some fresh smelling cookies or bread.

Real Estate Value – Exposure

Pure mathematics suggest that, the more potential buyers that tour your home the better chance you have to sell it at top dollar. Make sure your marketing plan includes listing your home on the internet both locally and worldwide. Professional flyers and brochures distributed in the neighborhood is another excellent way to give your home exposure.

Real Estate Value – Don’t List Too Long

If your home has not sold in a reasonable length of time, then take it off the market. A house that stays on the market to long, goes stale, and then will sell for a lower price. It is better to let the market correct itself, then relist.

What Caused Real Estate Values to Suffer

2008-11-05T19:11:00.000-08:00

With the proliferation of the mortgage market meltdown I address on other sites, we, as a nation find ourselves in the midst of...a mess. A big one.

We'll dig out of it but it ain't going to be easy.

You've probably noticed in your own city, maybe in your own neighborhood, more than unusual numbers of "For Sale" signs, unkept yards, and in some cities, a ghost-town-like feel. Empty of children playing, neighbors mowing the lawn, etc.

It's because most homes in most neighborhoods are...empty.

Recently the federal government passed a new bill, now law, called TARP. "Troubled Asset Relief Program) and man is it a doosey. As usual, you, I, our children and their grandchildren get to pay for it. All because somebody was asleep at the switch.

It amazes me that only when some politician gets caught with his hand in the cookie jar does "the issue" become a matter of concern. As long as politicians and CEO's are making money - LOTS of money, nobody's going to be a "whistle blower".

Back in the late 1980's we had a similar, although not as widespread occurrence which prompted the creation of the RTC (Resolution Trust Corporation) which I participated in by liquidating assets in Southern California.

See, THAT whole mess started when some idiot politician decided "deregulation of Thrifts & Loans" for his campaign contributing CEO buddies at those institutions was gooood. Very few masters of disaster ended up paying for their crimes. Most notably are Charles Keating, Jr., Michael Milken and Thomas Speigel.

Can you say "Junk Bonds"? Seriously, who would EVER buy anything that contained the word "junk" in it? At the time, the junk bond market racked up losses topping $200 BILLION dollars. We thought that was surely the end of the financial markets as we knew it. Hmmm, what amount are we up to now?

So now the American taxpayer gets to eat the entire cost of yet another bailout. It does however, sound like there might be some light at the end of the tunnel. The government will share some, if any, profits from sales of toxic assets with the taxpayer.

Toxic assets were created when mortgages for overpriced homes defaulted. The market of over priced homes was created when investors fat with cash looked at places like Las Vegas that historically had annual appreciation rates of between 3 and 10 percent. It also was one of the fastest growing cities in the nation. Those two factors were a formula perfect for profits. It was a city ripe for aggressive appreciation IF existing property could be bought then flipped. Which is exactly what occurred.

Yay.

The downside is that values of the properties and underlying mortgages have deteriorated to the point where profitability may be elusive. That's where you and I come in.

My role is to market assets that are deteriorating on the market, yours is to scoop up a bargain and call it your own. They're easy to find as long as you have a realtor AND loan officer you can trust. That's the secret to not falling victim to what contributed to this mess. Getting educated and informed, then making an intelligent decision.

Oh, BTW, DO NOT EVER, under ANY circumstances, feel or be forced into signing any loan documents BEFORE reading and taking notes of anything that doesn't make sense or you don't understand? Understand? I don't care if the friggin moving van is waiting outside in the 100 degree heat or the snow is coming down at two feet per second...just don't do it.

If you don't understand something in your loan docs, ask. The escrow officer, the mortgage company manager, an attorney, me. Make sure you understand what is expected of you and what the worst is that could happen. If you can live with that, then sign. If you can't, don't

So...what are we waiting for?

Real Estate Lead Generation

2008-11-03T00:16:00.000-08:00

So, how do you create a virtual tour, and what goes into making a good one? For the answers to these questions and more, keep reading.

Capturing and Creating a Virtual Tour

Then, you can use any of the following services or products to stitch together your tour:

FlyInside.Com (http://www.flyinside.com)

Totally free and easy to use, this simple website allows you to create a virtual tour using their basic online wizard. You can add your own branding for a small, additional fee.

TourWeaver (http://www.easypano.com)

MapWing.Com (http://www.mapwing.com)

MapWing allows you to create free, basic virtual tours which can then be shared on the web. You can upgrade for a more customizable, branded look.

Tips For Shooting a Virtual Tour

Try to get at least two or three hours in the home with no other activities for your photo session. You want your shots to look great and you'll need time and privacy to get it that way.

Once you're ready to shoot, focus on steady shots that are most flattering but also clearly visible, and take each shot four or five times to ensure a good shot.

Take your time to ensure your shots are clear and attractive. High quality virtual tours are a great selling tool.

Real Estate Short Sales

2008-10-30T08:05:00.001-07:00

It’s all the talk among the real estate blogs. Have you heard?

I had not written an article on real estate short sales because there is so much out there already. I decided to get up early this morning and see if anybody had written anything that would explain this process to a lay-person (a lay-person in short sales is somebody who owns a home with lots of equity — humor).

So what exactly is a short sale?

A real estate short sale is when a home gets sold and the proceeds from the sale “fall short” of what the property owners owes on the mortgage(s) on the home. The bank(s) agrees prior to closing to accept a lesser amount than what it is owned. The bank will do this if it feels it will get more money through a short sale than through the timely and expensive cost of a foreclosure action. The property owner will often consider a real estate short sale when the owner receives assurance from the bank the loan will be deemed “paid in full.” Sometimes though, the property owner’s only option is the short sale, even if a deficiency judgement results in the process.

Some Short Sale Advice

If you own a home that is highly leveraged (read that to mean that you borrowed as much money on it as you could sometime in the past three years) and you need to move for one reason or another, you need to know that you basically have four options right now:

1. Don’t move, stay in the property
2. Lease the home out to a tenant
3. Sell the home on the market
4. Give the property back to the bank (surrender the property with a quit-claim or deed in lieu of foreclosure)

Because this is an article about real estate short sales, we will assume that number 1. and number 2. are not options for you. In order to determine if a short sale is the right solution, the next step is to meet with a real estate professional that is an expert in real estate short sales.

Interviewing the Real Estate Short Sale Expert

Once you have determined that you must sell your home and you are concerned about maintaining your credit rating, you must interview the best real estate company to successfully work through the real estate short sale. That’s right, the correct company. The short sale process is easy to talk about, but the reality is that few companies give good short sale advice. Good companies successfully help the property owner through to the very end, with complete forgiveness on the loan. Here are some critical issues you should address in the interview:

* Do-Conduct the interview at the office of the real estate company. Tour the facilities and make sure you are introduced to the team that manages short sales.

* Do-Find out what banks with which they have successfully negotiated (they should mention contacts in the bank’s Loss Mitigation Department).

* Do-Ask for specific sales (properties and names) that they have successfully concluded a real estate
short sale.

* Do-Ask for the basis of their short sales training.

* Do Not - be concerned with how many homes they sold in your neighborhood (unless they were short sales).

* Do Not - be concerned with the car that they drive.

* Do Not - be concerned with how many homes they sold in the past (during the boom market with few or no short sales).

The Real Estate Short Sale Process

First and foremost, one must realize that real estate short sales take much longer than “normal” sales. This is because the bank requires a due-diligence period to ensure that it is not being taken advantage of and to ensure that it is getting the best return on its investment. I believe that this is fair. But there are things that your real estate company can do to make the short sale process go quicker, and that is where experience is the key.

A real estate company with real estate short sale experience will have a kit, a package, or at least a process to expedite the lenders decision-making ability. This package should include everything the lender will need to form its opinion on the real recovery value of the property. Additionally, the real estate company giving you short sale advice should be prepared to provide the following information to the lender at first contact (Be proactive, do not wait for the lender to ask):

* Property Taxes - current status and annual amount
* Homeowners Association - Annual fees and contact information
* Lawn maintenance - current handler contact information and fee structure
* Code violations - current status and amount
* Pool maintenance - current status and monthly amount
* Utilities - current status and monthly amount
* Property Condition - current status and deferred maintenance needs
* True sale-able value - Provide comprehensive market analysis including homes on the market and homes that failed to sell

Once the lender(s) has made a decision, just remember that there are often layers of decision makers at every bank. All agreements must be approved through the lenders legal department, and this too adds to the time it takes to close on a real estate short sale.

Conclusion

If you plan on selling through a real estate short sale, just understand that it will take some work. In the long run, it will be worth the hassle as you will better protect your credit rating and you most likely won’t have to repay as much of the money. The choice of real estate expert could be the difference between success and failure, so choose wisely on who should give you this short sale advice.

If you plan on buying through a real estate short sale, remember that patience is a virtue. No matter what the home owner agrees upon in the sales contract, the bank will be the final decision maker in the process. The bank and the real estate professionals will determine how long the entire process takes, so choose your short sale advice (real estate company) carefully.

Housing Crisis

2008-10-30T08:03:00.000-07:00

These are trying times for those who need to buy, sell or invest in real estate. Is now the right time to get into or out of real estate ownership? Does the market still have farther to fall? Can I make money if I invest now?

The real estate investor's very first rule of success is do not invest in a market where prices are falling. You can do that in the stock market because you can profit by short selling. I know of no equivalent tactic in real estate.

The second rule is to understand how to identify the bottom of the market. Surprise! The only way you will be able to identify the bottom of the real estate market is after it happens!

Yes, I know, there is just so much "bargain" property being offered for sale that you feel like a fool for not grabbing some. When a bubble bursts it scatters confusion over the landscape. Confusion is what's infesting property values today.

At the top of the real estate bubble some poor soul paid $450,000 for a very ordinary home. Now, during a major market adjustment with few buyers, that desperate owner has dropped the selling price to $300,000. Wow, what a steal, right?

The truth is we won't really know the true value of that home until a few months after the market hits bottom. Buy it now for $300,000 and run the risk of it losing another $50,000 in value over the next eight months.

A recovery of real estate values will be delayed by the financial mess that has been created by the U.S. government. For the last 15 years our political leaders have been promoting an environment where almost anyone could buy a home. Whether they could afford
that home was a question never asked.

Wall Street's investment bankers jumped on that opportunity and packaged collections of shaky mortgages into packages they called "securities" and sold them for fat profits to financial institutions around the world. Your pension fund may own some of that junk.

Congress continues to spend more than it collects in taxes, so the country runs on money borrowed from China and Japan. How long can that last? As this is written one presidential candidate is promising to raise taxes. If the government would cut spending at the same time there might be reason for hope. No one inside the beltway seems to be advocating less spending.

More taxes will mean consumers will have fewer dollars available to qualify for mortgage loans. At some point soon the Federal Reserve must raise interest rates to hold off the inflation that is beginning to eat into the earnings and savings of every U.S. citizen. Higher rates will prevent tens of thousands of potential home buyers from being able to afford mortgage loans.

We won't ever mention the problems being created by The Federal Reserve's panic to try and save the economy by pumping billions of tax dollars into failing investment banks and mortgage lenders. In addition they are insisting that mortgage lending requirements be tightened. A good idea, but there go a few more tens of thousands who won't be able to get a real estate loan.

Another negative signal for real estate is the number of real estate agents canceling their memberships in multiple listing services and failing to renew their state licenses.

Yes, Virginia, the real estate market will find a bottom, and that bottom will be easily recognizable.... about six months after it occurs!

Consider Commercial Real Estate

2008-10-28T04:03:00.000-07:00

There are nearly endless career possibilities in this day and age. Almost any childhood dream could be turned into an actual profession it seems. As a career counselor, you might be amazed to learn how many adults in our society of option after option really have little or no idea of what kind of career is best for them. I meet with clients all the time who are dazed and confused with too many options and no real clue of what kinds of jobs fit them best. I mention a variety of job options to clients, but commercial real estate is one option that seems to come up quite often.

The thing about commercial real estate is that there will always be a need for people in that field. Why? Because our modern world is filled with people who are into businesses of all kinds. People will never stop needing space to rent or own for their businesses and services to the public. Therefore, going into commercial real estate as a profession is a wise move for anyone who wants flexibility yet job security for their future.

Basically, commercial real estate deals with all properties, both rental and for sale, that are not residential. So any coffeeshop, grocery store or book store that moves into an area must deal with a commercial real estate agent to make the purchase or rental agreement. Similarly, builders who specialize in buildings that will be used for non-residential things must use a commercial real estate agent in their planning and to rent or sell their buildings out for business.

If you are looking for a great career, then consider becoming a commercial real estate agent. Talk with current commercial real estate agents to learn more of what they do for a living. Think seriously about whether or not a job that works with the public is right for you, because a commercial real estate agent will be working with people constantly. If you are passionate about people and about business, then this could just be the profession for you.

Commercial real estate is a booming business that will continue to boom as long as people are in the business of selling things and offering services to the public. So jump into this profession while you can. Enjoy your days meeting with clients and helping them to secure the best possible space for the business of their dreams. You can be fulfilling your dream while helping others to fulfill their dreams as well.

Diversifying Through Real Estate

2008-10-28T04:02:00.000-07:00

We should all diversify our investments over different asset classes. Real estate is an excellent vehicle for diversification.

Real estate rental properties used to be a perfect investment for high wage earners. They were able to deduct all the losses generated by the property - and when you added up mortgage payments, property taxes and maintenance, the losses could be substantial - from their gross incomes.

The IRS has rained on that parade. Real estate rental properties are now considered passive activity, even if you actively manage the property. The only ones who can take full advantage of real estate investing losses these days are the so-called “real estate professionals.”

However all is not lost. Even now you can deduct all the expenses of a rental from the gross rental income. If the losses exceed income, they are converted into passive activity losses which are not deductible against ordinary income, but are deductible against other passive activity income as well as any gain made when the property is sold.

Real estate investing offers several special advantages: the purchase can be highly leveraged, from zero down to the usual 20% down payment; the mortgage payments are generally tax deductible as are the taxes and expenses of maintaining the property; and if you own the property over a year, it is subject to long-term capital gains taxes – presently 15% - minus any accumulated passive activity losses.

Because of the highly leveraged nature of most real estate purchases, investors can afford to own multiple properties. Or you can start small, with one property, and use that as leverage on another house as your equity in grows.

However, real estate is unlike other investments. Unless you buy raw land, it requires management and maintenance, insurance and tax payments. There will even be continuing costs with raw land, property taxes and liability insurance being the major expenses. If you think you can’t be sued if someone trips on a log or falls into a hole on an undeveloped piece of property, think again. Ask your lawyer what the liability laws in your state are.

If you own rental buildings, they must be insured, properly maintained and rented out. Someone has to fix the problems and collect the rent. You can do this yourself, especially if you like being awakened at three in the morning because a toilet won’t flush – I’ve been there and done that. Or you can hire a management company to do this for you. Most work on a cost plus basis.

Because of all of this, you do need to find properties that either throw off good income from rents or have the potential for appreciation, especially if some repairs are done. In other words, you have to work out beforehand how any given piece of real estate will make money for you. If it won’t, keep looking.

Real estate prices are not as volatile as the stock market’s can be, but they do fluctuate. It is better to go into a real estate investment with a long term frame of mind and remember the rule “location, location, location”.

Over time real estate values tend to grow and, because of the leveraged nature of the investment, the growth is magnified. For example, 5% growth on $150,000 is $7500. But if you only have 20% down or $30,000 invested, that $7500 becomes a 25% return on your investment.

Of course you don’t have to own real estate outright. You can invest in “Real Estate Investment Trusts (REIT)”. These are professionally managed funds that usually invest in larger, commercial projects – shopping malls and office buildings. Your aim is long term capital appreciation. The investments are heavily leveraged and the tax benefits spread among the partners.

Since real estate does not necessarily move in the same directions as stocks or bonds and also generally tends to hold its value, this is a good diversification move, but you are unlikely to realize the gains you would see with individual real estate holdings.

Also, despite the fact that real estate is booming right now, it can and has fallen, sharply at times. There have been gluts of office space in major cities, overdevelopment of residential housing (remember the S&L debacle of about 15 years ago), or there could just be a general down real estate market from time to time.

Most of us have already diversified into real estate by purchasing our home. If the equity is preserved, this can turn into a major cash cow after several decades of use. If certain simple rules are met, you can exclude $250,000 ($500,000 if married and filing separately) of any gains you realize.

As you can see, real estate investing, if done properly, can be quite lucrative. But study the subject intensively before committing yourself. The library is full of good books on the subject.

Real Estate – The Boom Is Over

2008-10-28T03:58:00.000-07:00

Sales of existing homes fell a bigger-than-expected 2.7 percent in October, a fresh sign that the red-hot housing market is cooling. The decline would have been worse without increased demand from displaced hurricane victims.

Though prices rose at the fastest clip in more than a quarter-century, the number of unsold homes rose to the highest level in 19 years. Analysts forecast that this backlog will dampen future price gains.

The National Association of Realtors reported Monday that sales of existing homes and condominiums fell by 2.7 percent in October, more than double the 1.1 percent decline analysts expected.

Economists said the latest report, which showed sales declines in all regions of the country, appeared to be a signal that the booming housing market was beginning to slow under the impact of steadily rising mortgage rates.

The decline in sales pushed the number of unsold homes to 2.87 million, the highest level in more than 19 years. It would take 4.9 months to deplete that inventory level at the current sales pace.

The median, or midpoint, price of an existing home sold last month rose by 16.6 percent to $218,000, compared with October 2004.

Economists predicted the buildup in unsold homes would help dampen the surge in home prices that saw 69 cities report double-digit gains in prices this summer, compared with the third quarter of 2004.

The sales slowdown was linked to the Federal Reserve's continued campaign to boost interest rates to combat the threat of higher inflation after the recent surge in energy prices.

Most analysts believe housing will cool gradually to more sustainable levels but will escape the adverse consequences that occurred when the Internet stock bubble burst in early 2000, wiping out trillions of dollars in paper wealth and helping to push the economy into a recession. But, many real estate ‘insiders’ see thing quite diferently, and are forecasting a much larger drop in real estate values because of the huge popularity of 100% interest only loans used to both in the purchase and re-finance of homes over the past five years.

The weakness in existing home sales in October followed an earlier report that construction of new homes and apartments fell by 5.6 percent last month, the biggest setback in seven months. Applications for new building permits, a good sign of future activity, fell by 6.7 percent, the biggest decline in six years.

The 2.7 percent drop in sales of existing homes would have been a larger 3.2 percent decline without a boost in activity from people relocating after hurricanes Katrina and Rita devastated the Gulf Coast.

Sales surged by 83 percent in Baton Rouge, La.; 32 percent in Mobile, Ala., and 14 percent in Houston. This more than offset sales declines of 42 percent in New Orleans and 44 percent in Beaumont, Texas.

The 16.6 percent increase in the median sales price was the biggest year-over-year price increase since a 17.2 percent jump in July 1979. The backlog of 2.87 million unsold homes was the highest since April 1986.

By region of the country, October's biggest sales decline occurred in the Northeast, a drop of 7.4 percent. Sales were down 1.9 percent in the Midwest and 1.2 percent in the West. Sales were down 1.8 percent in the South despite the big gains in areas where displaced homeowners relocated

Real Estate Markets For Price Increases And Decreases

2008-10-23T02:59:00.000-07:00

In its 4th quarter report of 2006, the real estate information site estimates the home value trends for the U.S. and 75 metropolitan areas. According to the data from http://Zillow.com, home values are now declining slightly on a year-over-year basis for the first time in a decade after years of appreciation.

Zillow's home value data goes back to 1997 and reveals the depreciation of home value rates at 0.48 % year-over-year at the national level. The depreciation in home value every quarter is at 4.77 %. Zillow's appreciation rate is based on the value of all homes in an area, including those that were sold.

Although there is a fall in the over-all home price growth, areas such as Seattle and Portland are experiencing a surge in home values at good appreciation rates. Besides national home values, the report also presents comprehensive data on local market price growth and decline in 75 metropolitan areas. The Zillow report gives detailed data on home value changes for counties, cities, neighborhoods and ZIP codes in U.S.A.

The top 5 metro areas with the highest price growth, year-over-year, are:

1. Lakeland-Winter Haven, Florida, with an appreciation rate of 25.88 %
2. Yuma, Arizona, with an appreciation rate of 25.66 %
3. Myrtle Beach, South Carolina, with an appreciation rate of 21.24 %
4. Flagstaff, Arizona, with an appreciation rate of 19.02 %
5. Ocala, Florida with an appreciation rate of 17.56 %

The 5 metropolitan areas that have the most declining home values, year-over-year, are:

1. Panama City, Florida, with a depreciation rate of 11.84 %
2. San Luis Obispo-Atascadero-Paso Robles, California, with a depreciation rate of 11.35 %
3. Punta Gorda, Florida, with a depreciation rate of 9.23 %
4. Sarasota-Bradenton, Florida, with a depreciation rate of 8.99 %
5. Greenville-Spartanburg-Anderson, South Carolina, with a depreciation rate of 8.73 %

The Zillow national report also includes the top five most expensive and least expensive metro areas measured by the Zindex home value indicator.

The top 5 metro areas that are most expensive are:

1. San Francisco-Oakland-San Jose, California at $684,459
2. Salinas, California at $654,503
3. Santa Barbara-Santa Maria-Lompoc, California at $627,323
4. Honolulu, Hawaii at $626,452
5. Los Angeles-Riverside-Orange County, California at $545,409

The top 5 metro areas that are the least expensive are:

1. Davenport-Moline-Rock Island, IA-IL at $86,201
2. Peoria-Pekin, Illinois at $91,984
3. Greenville-Spartanburg-Anderson, South Carolina at $96,508
4. Tulsa, Oklahoma at $97,186
5. Dayton-Springfield, Ohio at $103,729

Even within these markets, there are hot and cold housing segments of the community. Be sure to seek out the services of a local real estate agent, who can advise you about local market conditions that impact the price of homes, condos and other types of real estate.

Deciding Commercial Property Market Value

2008-10-20T20:46:00.000-07:00

Even though we are currently in a buyer's market, many land owners are looking to sell it to potential buyers. Before an individual can sell it, they must know how much to value their own property in order to attract potential buyers. Most individuals appraise property before they sell it.

Valuing commercial property is very important for an investor. If an individual values it at a price that is too high, then it can prevent the sale from taking place. If a piece of a property is valued too low then the seller will lose out on a potential profit. The best way to evaluate commercial land is by an appraisal.

There are many ways of appraising and deciding commercial property market value for a piece of property. Many owners will usually pay for one or two appraisers and compare each individual's evaluations. Most professionals appraise a piece of land by developing an opinion of the value of property. An appraisal of a land occurs because no two properties are identical and the value of all of them differs based on location. Because estimating a property's value does not always utilize a market-based pricing mechanism, an expert appraisal of the real estate is needed.

Usually appraisals are performed by a licensed appraiser. Many times the appraiser bases his or her opinion on market assessment and the Highest and Best use of real property. An appraisal is most often reported on a standardized report form. If the appraisal is for a complex piece of property with many unusual characteristics, the appraiser will typically report their findings in a narrative report.

An appraiser will determine a cost approach, a sales comparison or salary-based approach when assessing your property. The cost approach suggests that the value of the property is equal to adding up the value of the land minus any needed improvements. This approach is usually used on newer structures and less on older structures. The sales comparison approach evaluates the price per unit area of land similar to other appraisal amounts of similar properties in the marketplace. This approach is the most objective of the three approaches and allows the appraiser very little wiggle room. The salary-based approach is used to value commercial and investment properties, because it evaluates an income stream.

Since these techniques vary greatly amongst each other, the technique used will depend on what type of asset you have. For example, appraisals of investment property such as skyscrapers may be subject to the income approach, whereas retail or office buildings may be subjected to the sales comparison approach. An apartment building may be more subjected to the sales comparison. Before you sell your property, make sure you appraise it with an expert.

UK Property Market

2008-10-20T20:45:00.000-07:00

There have been reports that the property market in the UK is heading for a downturn, with claims that the market will be gaining its healthy shape in a couple or so years. Jones LaSalle, a property expert, states that the decline of residential and commercial prices over the past nine months has created a "yield gap between prime and secondary assets back into the market." The guru claims that this situation poses an advantage for cash-rich investors. While the unrelenting tight supply of credit is deemed to have an absolute impact on the property market in the UK as a whole, the firm insists that there is still a demand for quality assets.

This recent report comes amid the general consensus that the housing explosion is over. Recently, the media has reported that most areas in England have listed price declines, with homes located in Greater London taking the sharpest decline of all. These reports may be causing some people in the UK to question if it is still indeed a good time to invest in property.

Stories of a property crash in the UK have been consistently in the news for quite some time now. But many experts are of the belief that the property market will remain solid. The reason is that the supply of property is insufficient to meet demands not to mention the fact the property is still affordable.

When the prices soften or when there is a decrease in asking price, there is always a group of ready-buyers that are willing to pick up bargains. These include would-be first time buyers, family movers, or property investors looking for deals. The reason why there is a ready supply of buyers is because there is a fundamental undersupply of property, as the current number of completed establishments is running below demand.

The increasing demand for a diminishing supply of property will cause prices to remain firm. Even though unsold properties have been reported to increase, the unsold stock levels are expected to stay below the long-term trend. One of the reasons is the growth in population. Inward migration has risen significantly due to the attraction of the UK as an excellent place to work and live in.

In addition to this, there are also two worthy circles that make the decision to invest in property a sound one. Seemingly, no matter which way the UK economy turns, property is still expected to stand out, most especially over the long term. First, when the economies of the world enter another recession or depreciation, then interest rates could come down, further decreasing property investors' expenses, while retaining the rental revenue. Second, if the capital values of property take a fall, then people will cease buying properties, and rent instead. The increase in rental demand will then spur a rise in property income.

All these point to the fact that property remains one of the best long term investments you can make. The only thing that investors need to seriously take into consideration is the location and choosing the right property at the right time. After they get that down pat, they can expect to take part in the substantial growth of the property investment market that has been consistently performing well over the last decade.

Dubai Real Estate

2008-10-16T22:39:00.002-07:00

Dubai Largest property selection , a portal with no compare with others around the world. A webase solution with all necessary tools and data to make decision of real estate acquisition in the Unites Arabs emirates.

At Alineah, our mission is to help you find your perfect Dubai property. Browse Alineah the Dubai buy rent sell platform for Dubai properties. Search our listings for Dubai villas, Dubai apartments and also Dubai offices which are currently for sale or rent in Dubai.

We constantly update our site adding new Dubai properties; if you don’t find your perfect Dubai property on your first visit to our site, please register for alerts so we can let you know the minute your desired Dubai property gets uploaded.

Find the right Dubai real estate Agent here. Alineah is committed to providing comprehensive information and putting you in touch with the right real estate agent to meet your needs.

Dubai buy rent sell. Property owners and real estate agents list your Dubai Properties on Alineah and see your phone ring. All properties will be listed with your own logo and contact number. Your properties will be reachable by other clients on all our affiliates’ websites. Don’t miss to register now.

Book your Dubai Holiday with Alineah. Our team is dedicated to provide you with the best possible vacation while staying in Dubai. Contact us to find you a convenient short time rental property for your Dubai Holiday. We offer fully furnished apartments and Villas in Dubai.

Keep up to date with Alineahs Dubai real estate info. The last 3 years have reported that Dubai investment can be a very lucrative decision, besides the booming Dubai real estate development with unique concepts such as The World and Dubai palm island and the growing economy with rising immigrants from all over the world, another reason why an increasing number of international investors are attracted to Dubai is undoubtedly the favorably tax system, where no personal income or capital gains taxes exist. Which means a Dubai investment can give you a higher return. Learn the about the Dubai Property market, visit our Dubai real estate analysis links with valuable information for any Dubai investment question.

Find your dream Home in Dubai- Search for freehold and leasehold Villas in Dubai. Your Dubai Villa in Emirates Hills, The Springs, Jumeirah Island, Meadows, Dubai palm Island, Dubai Land and more.

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The unprecedent success of the webportal of www.alineah.com had take attention of the major web property market in the asian continent, www.alineah.com had turn dound offer for the purchase of the property portal in the Emirtates. Big payer , see the biger picture and know that the web property marketing is doing excellent performance over the net.

Real Estate Info for Successful Deals

2008-10-16T22:39:00.001-07:00

There is very wide variety of options when it comes to investments in real estate, and having all the required real estate information is vital to improve your business and to, ultimately, be successful in it. Investments within this area are quite numerous, from buying a property in which to spend your vacations, to a small place in which to live once you retire, every single piece of real estate information you gather may allow you to encounter the perfect client and the proper means to satisfy his or her needs.

First of all it is very important that you get acquainted with the current status of the marketplace. If you do so, you will be capable of providing your clients with not only great prices, but also you will be providing them with something every single client is looking for in a real estate agent, expertise and professionalism. Try telling your clients about different statistics of the market, be honest with them and observe their positive reactions.

Another very important piece of real estate info is to be aware of what surrounds the property you are trying to sell, most time people are more interested in the places they can find around the property than on the property itself. Places such as schools, restaurants, hotels, and social gathering places, are often key elements for closing a successful deal. So remember to keep your clients updated on the different places available for them around their new potential property.

But there is also an important part about real estate info that you should know about, always keep your clients happy. Now, I know it sounds obvious, but you would be amazed to know how many real estate agents do not follow this easy procedure, and it basically happens because some real estate agents try very hard to make a great first impression when they should actually be focusing on creating an everlasting impression. How to do it? Well, always remember that your clients do not want to feel as yet another client, they want to feel as if your life is only about them, so try to personalize every presentation you give, try to keep close contact with your clients, make them believe that they are the only thing in your life. Elements such as photos of their potential property included in the presentation along with their name in the title really helps them to visualize themselves living in the property and it also helps the agent to establish a closer relationship with every client.

Now, probably the most effective real estate info is to remember to be always, ALWAYS available. Many real estate deals are closed when the client is overexcited about the property, but if he can't find you it may be the factor that triggers a "cool-off", so try to be mobile all the time and keep contact with every single client. A great way to do this is to provide your clients with your mobile number and to acquire a device that allows you to connect to Internet and check your emails constantly, such as a Blackberry. With this real estate info I can guarantee you will see an improvement in your real state deals very soon.

Promotional Real Estate Postcards

2008-10-13T07:22:00.000-07:00

Why Promotional Real Estate Postcards Are Beneficial

Promotional real estate postcards are beneficial on a variety of levels. They make a perfect first impression and are cost effective. Promotional postcards will receive a higher return rate, since they create a reply from promising clients and existing clients alike. They spread your name recognition and make you the initial individual they think of when real estate help is necessary. Real Estate Postcards are not new and they are not going anyplace for a reason.

Name Recognition

The more frequently your prospective clients and customers see your name and get your promotional postcards, the more known you'll be. When individuals in the neighborhoods you target consider selling or purchasing real estate, they will think about you before anybody else.

First Impressions

These postcards do not require an envelope to mail, meaning that, over other various mailed ads, you'll have the advantage that your house photos and heading will reach the eyes of potential customers practically in spite of themselves. Postcards require no maintenance in this world of an excess of spam mail, cell phones, and junk mail

High Rate of Return

When was the last time you got a postcard in the mail and you did not check out the front, flip it over and, at least, browse what it says? How about e-mail? Just how many emails have you deleted without opening, or junk mail letters or fliers that have ended up in the trash without another thought?

As a real estate agent, marketing with post cards is one of the most ideal choices you can make for increased name recognition and great visibility. And the best part? You can be as inventive with your postcards as you want to be. In fact, the more creative you can be, the better it is. Undoubtedly, you're not the sole realtor in the area. But with a unique just sold postcard, you should be the most well known realtor in the area.

Are you an especially good baker or cook? Perhaps special recipes on the front of your just listed postcard is a good trademark for you. Do you love classic cars? Maybe a profile of a different one on every card can set you apart. Major fan of botany, history, or the local hockey team? Captivate while you establish your hallmark and potential customers will actually enjoy receiving your real estate postcards.

Of course, the back of your real estate marketing postcard is going to have your contact information, possibly a future open house or a few examples of listings that are on the market. The most imperative part is that you generate a brand and implement it on every card.

The marketing term for introducing and then reacquainting potential clients and customers to your unique advertising and marketing style is referred to as branding', 'brand name recognition', or 'identity branding'. You achieve this with repetitive contact. Arrange a pattern of sending out your specialized brand of real estate farming postcards regularly and you will make your mark.

Make The Most Out Of Your Catalog Real Estate With These Tips

2008-10-09T09:14:00.000-07:00

More than your pictures and illustrations in your catalog, your catalog copy is one of the most significant elements in your marketing collateral.

Copywriting is basically an art form that lets you communicate your message to convince your target readers to do your bidding. And this is not an easy task. Mastering the art of persuasion involves creating descriptive copy that allows your audience to see, feel, taste, hear, and smell your products through your words.

As your target readers don’t experience all these activities in your catalog in reality, you need to provide the sensory experience through your text. Your words should be able to fill that gap between your prospective clients and your product.

It’s not a new concept actually – copywriting as a sensory activity. If you think about it, it’s always part of having to convince your target readers to see your products the way you see them.

And mere words just don’t work. You need effective descriptions to make your audience really understand your product. Effective descriptions are what draw your clients to the situation even if they are not there.

For your real estate catalogs, you don’t just write how many units you have in your condominium, or how many rooms and bathrooms each unit has. Your descriptive copy should be able to use words that actually transport your client from his dreary place to a place where the breeze is blowing in his cheeks and the warm sun waking him up in the morning.

Can you feel the cool breeze kissing your cheeks? Can you smell the newly cut grass from your lawn? Does it paint a pretty picture for you?

How about “sun-dappled terraces”, “authentic hand woven hammock that cradles you while you sleep”, “sunning in your tree-shaded veranda”…these are examples of how you can infuse your catalogs with effective descriptions to make your real estate business more appealing.

I can’t say it enough. Writing descriptive words that appeal to the senses is essential to having an effective custom catalog for your business.

Your clients can’t see, feel, hear, smell or even taste what you have. The next best thing is to provide them a clear illustration that will attract their senses so that they’ll want to purchase from you.

When you write your custom catalog copy, choose the most suitable feeling and focus on those senses. If you’re into real estate then obviously you need to target on the sights and feelings.

The main thing here is to help your readers see, feel, hear, smell, and taste your product that is not there in front of them. Let them experience what you yourself have experienced with your product. When you have great copywriting for your catalogs, then that’s the time that you will truly get the most out of your real estate catalogs.

Real Estate Email Marketing Maximizes Your Exposur

2008-10-09T09:13:00.000-07:00

There's little doubt that the U.S. real estate market is undergoing a profound transformation. After several years of freewheeling lending practices and unsurpassed increases in home valuations, the real estate market is undergoing a major correction. Home values are dropping in many areas around the country, and some homeowners are facing an impending uptick in their adjustable rate mortgage payments, placing them in an untenable position.

In short, it's a volatile market. Lenders are tightening the criteria for mortgages, and the window for subprime lending is closing. Some homeowners who are holding subprime mortgages are facing foreclosures, while others are trying to sell their homes before they find themselves in a negative equity situation. As a result, real estate professionals, investors, and home sellers are scrambling to gain an edge in a competitive marketplace.

Real Estate Marketing

Long gone are the days when traditional methods of real estate marketing are sufficient to move properties. A sign on the lawn, a Multiple Listing Service listing, and an open house still have their place, but they comprise only one facet of an effective real estate marketing campaign.

Just as in most other areas of business, the Internet is playing a crucial role in real estate. Online listings of homes for rent, homes for sale, and foreclosures draw an increasing number of buyers and investors. Photographs and video are increasingly being used to whet the appetites of potential buyers. Still, online listings and multimedia presentations are relatively passive forms of marketing in this competitive era. Those who are on the cutting edge are utilizing the Internet to their best advantage, and taking strategies from the playbooks of those in other fields.

Email Marketing as a "Push" Strategy

If drawing potential real estate buyers to an online listing is a "pull" strategy, then real estate email marketing is a "push" strategy - one that makes sense in today's marketplace. After all, retailers and e-tailers use email marketing to their best advantage. Email inboxes are stuffed with large and small business emails alike. It makes sense that real estate email marketing can also be effective, in that it delivers information about agents, developers, sellers, and their respective properties directly into the hands of interested potential buyers.

Email Marketing is Easier than it Seems

At first blush, real estate email marketing may seem out of reach for many people. After all, their expertise is in real estate and they may not be very tech savvy. On the contrary, there are online real estate services that make email marketing a cakewalk for virtually anyone.

When looking for an online email marketing service, choose one that can help you create emails, manage your contact lists, and obtain tracking reports. Essentially, you should be able to send your first email marketing piece in less than an hour. The best services have "wizards" that allow you to, for example, put together email newsletters using a Web interface and on a single screen. Templates and click-and-drag functionality allow you to easily arrange text, upload photos, and instantly see what your recipients will see when they receive your email.

Once you've sent your emails or newsletters, the service should enable you to track the results, telling you how many emails you sent, how many bounced back, how many people opened the email, how many clicked on the links, and how many forwarded it on to others.

There's little doubt that real estate email marketing is a cutting edge tool that helps push your message into the inboxes of potential buyers. And in today's competitive environment, it's an advantage you can't afford to be without.

Gain Financial Security By Learning Real Estate Investing

2008-10-05T22:30:00.001-07:00

Anyone who knows anything about Real Estate Investing knows that the most secure path to creating wealth is by investing in real estate; however, before you jump in head first...you must have a financial plan.

Most people don't see the correlation between the two. There are so many methods of investing. You must first decide on what your ending financial goal is in order to figure out which real estate investing path you need to take. Secondly, you must sit down and figure out how much money you have to invest in real estate while maintaining your daily living.

The final and most important concept that we must understand is that a salary and a 401K will never create the wealth that most of us are aiming for in our future. If this was enough, we would not have so many grandmothers and grandfathers handing out smiley face stickers at Walmart. No one PLANS to to be a professional elderly sticker passer outer. On the other hand, no one becomes rich who doesn't make a financial plan unless they are born with that shiny silver spoon.

We all know that there are certain things in life that you just don't want to do...balancing your checkbook and financial planning are right up there with going to the dentist. But the end results of neglecting any of these, is not very favorable. So suck it up and dig in.
The retirement plan of the past:

Work at one job for thirty years, work your way up the corporate ladder, get the gold watch, live off of your pension plan and social security. Pretty straight forward and simple. This retirement plan presents quite a few problems for the present and future retiree.

Problems with the retirement plan of the past:

1. You can no longer depend on your employer to provide for you after you stop working.

First of all...most of us never stay at a job long enough anymore to build up a decent pension. So if we are lucky, we depend on the faithful 401K. The problem with this is that you have to make half of the contributions yourself and if you are a contractor or an entrepreneur you don't even have this luxury! Even if you were responsible enough to start your 401K in your twenties, (which most did not) the rate of inflation will eat away at your saving like rabid dog.

2. You can no longer depend on the government to provide for you after you stop working.

How wonderful are your golden years going to be with $14,000 a year from social security? (Oh, that's only if you contributed the maximum over your life time). Well, I won't speak for everyone but I don't want my big bingo day to be interrupted with clipping coupons and buying groceries with food stamps; however, this is what you have to look forward to if you depend on the government.

Not to mention...when the government set up social security, they only thought that we would live to be 60 to 65 years old. So there may not even be any money left when you need it.

So what do you do?

The present and future retirement plan:

You have to invest your money in an inflation proof entity that will provide for you despite your age. Real Estate is the only investment that is not negatively effected by inflation. It will also continue to grow for you no matter what your age. I attended my best friend's grandmother's funeral today. She lived to be 104 years old. She had the foresight eighty years ago to invest in real estate. She owned several properties in Washington DC. The investments provided for her for her entire life including her elderly care. These investments continue to provide for her children, grandchildren and great grandchildren even after her death. This is the definition of creating true wealth and securing your financial future.

For Sale by Owner For Financial Gain

2008-10-05T22:29:00.000-07:00

If you are the owner of the house and want to sell it, direct "for sale by owner" or FSBO technique is a better option for you to get financial gain from it. Property market, although vibrant, you need to have some skills to sell your property in this market so that you can gain financially.

FSBO or for sale by owner method is continuously gaining importance, as here you the seller and the buyer gains a huge 3 to 6 percent of the sales value and if the cost of your forsalebyowner property is $200,000, your financial gain is in the range of $6000 to $12000, which is a huge amount.

Actually a real estate agent earns huge profit for his excellent marketing skills and if you can develop these marketing skills, you are definitely going to have the outcome of your forsalebyowner property in your favor. Property market is very vast and with the invention of Internet, this market is global now and therefore if you are able to send your FSBO ad across the globe, you will definitely do well in rest of the sale process.

The advertising of "for sale by owner" property plays a key role for a favorable transaction and in addition to the conventional for sale board much more needed for getting financial gain from your FSBO property. You should use all latest and modern tools of communication and advertising forsalebyowner property so that a large number of audiences see your ads.

In addition to the advertising, you need to sharpen your negotiation skill so that you get financial gain from your for sale by owner house. You should negotiate the price in such a way so that the buyer feels, he or she are also getting largest benefit from your FSBO house or property. You should keep the initial price a little high so that you are comfortable in reducing the price of forsalebyowner house at negotiating table.

So, latest means of communication along with the modern advertising tools are sufficient enough to bring large number of people to you. You must have some excellent negotiation and marketing skill so that you struck a deal and gain financially from your "for sale by owner" or FSBO property.

Instructing a Real Estate Agent to Sell Your Home

2008-09-30T21:10:00.000-07:00

It is perfectly possible to appoint more than one agent when selling your pride and joy, but this does depend on what type of contract you have with your agency. It is imperative that you proceed with caution before instructing a second agent. As with all contracts in all things you should read the small print carefully.

It is there for a reason, and many an unwary customer has tripped over the tiny print. You wouldn't be the first. If there is anything you do not understand or are confused by, then seek out appropriate professional advice. Don't sign anything until you are 100% satisfied and don't accept the agency's advice as gospel here because at this point they are not looking out for your interests, they are looking out for their own.

In short there are five different contracts you could sign with a real estate agency. Make sure that you know the differences and make sure that you know which one it is that is presented to you.

SOLE SELLING:

With a sole selling agreement the real estate agency always retains the right to charge you commission on the sale of your home even if you find the eventual buyer quite independently of the agent. You can't avoid the fee by doing the work yourself. If you try to do so you could end up being sued.

SOLE AGENCY:

With a Sole Agency agreement the agent is still the only agency granted rights to sell your property, but there is now no commission due to the agency if you find the eventual buyer yourself. Check the small print that this is indeed the case before you sign the agreement. If in doubt ask the agency to confirm the point in writing.

MULTIPLE AGENCY:

You have the right to appoint more than one agent to try and sell your home if you choose to, but you only have to pay a selling commission to the successful agent that sells the property. Multiple agency agreements often stipulate a higher than normal percentage commission rate. Check that fact and the point that you will only be liable for one fee in any event.

JOINT SOLE AGENCY:

In the case where you appoint two or more agents to work together to sell your home they will split the fee equally between themselves when the property is sold irrespective of who is responsible for the sale. Make sure the small print says what you think it says. Don't be confused by legalese and gobbledegook. Insist terms are written in plain English.

READY WILLING & ABLE:

This a quite rare and crazy type of agreement that should be avoided at all costs. In effect it states that if the agent finds you a buyer and you pull out of the sale for any reason, you will still be required to pay the agent their fee, even if you never sell your property and never move out. Why anyone would knowingly agree to such an agreement is a mystery and probably comes back to the point of the seller not reading and not understanding the small print in the first place.

The vast majority of agents are honest and hardworking but there is always the occasional bad apple in every barrel. You can help to protect yourself by reading and understanding the small print on all documents presented to you. The most important thing of all is that if you do not understand anything do not be afraid to seek out independent professional advice. That will give you all the reassurance you need.

Good Features and Facilities - Selling a Real Estate Property

2008-09-30T21:09:00.000-07:00

House selling is one of the hardest tasks that an individual can have. You need to have a good convincing power to sell you home in a faster way. But of course good convincing power is not enough when selling a Sarasota real estate property. You should have at least strategy in selling the property.

Know your product, study the market as well; these are just some tips that you need to learn in selling. Know the worth and quality of the product that you are selling. You must study the capabilities and some other feature that can help you out selling your property.

An accessible location is a good feature that you can tell on your buyer, accessibility to a lot of places and establishment is usually one of the considerations that buyers look for. If your home is very accessible to different establishment it can be sold in a timely manner and a lot of buyer will be interested buying your home. You can demand for a higher selling price having this kind of feature.

You can also brag to your buyer, the facilities and available amenities in the area. If your home is located in a village, you can tell your buyer about the facilities of village, facilities like swimming pool, basketball courts, park, elegant entrance and many more. These will surely a good way in attracting more buyers to purchase your home.

Given the fact that your home is accessible and has a lot of facilities and amenities around it, you must not overlook on how you home looks like. Being judgmental as we are, people can be easily attracted on the physical aspect of an object. The looks and cleanliness really matters in terms of selling a home.

Make your home attractive and clean, do a make over if you feel that your home looks boring outside. You can repaint the walls outside and do a general cleaning inside your home. A good way of beautifying a home is having a refreshing surrounding on your lawn. You may want to create a beautiful garden and do some landscaping.

Invite prospected buyer to have a view in your home, make it an open house for sale so that a lot of buyers may come and consider your home at Sarasota real estate market as their investment. But of course you need to make sure that everything is fixing and clean. Check all the facilities if they are all in a good working condition and if there is any, fix it and do maintain it regularly.

The Fall Real Estate Market is Kicking Off - Home Stagers, Are You Ready?

2008-09-27T04:44:00.000-07:00

Now that we're into September, while the weather may be cooling down, the fall real estate market is heating up! There couldn't be a better time to take a good look at your home staging business and make sure your image is polished to perfection for the (potentially) busy months ahead.

Have you been in the business long enough that you don't feel you need to do anything different? What a shame! All home stagers should do a bit of maintenance on their businesses regularly no matter how long they've been in the industry.

The following is a classic 5-point "Are you ready?" list to help you prepare for the fall real estate market whether you're a new or more seasoned home stager:

1. What are you wearing? No, I won't get into wearing white after Labor Day here, but you should go through your wardrobe and make sure you have some appropriate, fashionable items from last fall that are not out of date and that still fit. Make sure your shoes are in good shape and your jackets have been dry-cleaned. You should invest in a few new pieces now as well to help get you through another season. Treat yourself to a new hair cut. Besides giving yourself a new look for fall, you'll feel great and get an instant confidence boost.

2. Spend some time on your website. If you're like most people who have a website, it's never going to be finished, and it shouldn't be! You should constantly be adding new content and updating your photos and testimonials. As your business evolves your website will too. If you don't have a website, how are homeowners going to find you? Graduates of the Staging Diva Home Staging Business Training Program are given the option of adding their profile to an exclusive Directory of Home Stagers. It acts as an instant web presence and allows homeowners and Realtors® to find an expert home stager in their city very easily.

3. How current is your portfolio? If you've been busy and haven't had time to update your portfolio with all the great before and after shots you've taken over the summer don't put it off any longer. With fall being such a hot time for homeowners to list their properties you can't afford to have a home staging portfolio that's less than perfect.

4. Are your marketing materials current? When did you last give your marketing materials a facelift? Do you think it's time? Did you get some cheap business cards when you first started your business and feel ready to upgrade to something nicer? Has any of your contact information changed? When you have your business cards all ready to go, you have to use them in order for them to do you any good! Get out and network. If you haven't already, join your local Chamber of Commerce or referral group and start getting connected.

5. Do you have a plan? Do you have a marketing plan for your home staging business? You don't have to invest 40 hours creating a big fancy marketing plan. Spend focused time at your computer or sitting down with a pen and paper to make a list of marketing goals along with a list of specific steps you will take to reach those goals. The more specific you are the better, and keep it simple so that you will take action rather than feeling overwhelmed. Fall is the perfect time to do this. Staging Diva Sales and Marketing Secrets to Boost Your Home Staging Business includes a handy list of inexpensive marketing tactics you can start using right away.

So, are you ready? Because ready or not, the fall real estate market is creeping up behind you! Don't make the mistake of staying in your comfort zone. Try something different in your marketing or add something new to your website. Make sure you're at the top of your game for this season and you will be rewarded for your efforts!

Destin Real Estate Market Update

2008-09-27T04:42:00.000-07:00

The Destin real estate market, like many areas around the country remains weak. The good news for buyers is that if you are looking to buy, you probably could not pick a better time, assuming you are very aggressive with your offers.

What everybody knows in this market is that it will return, and will return very strong at some point. When that turning point actually occurs however is anybody's guess.

The data below provides a good indication of the market status.

# Sales : Down by 55% compared to last year
$/Sqft: $182 which is down 9% from last year
Median Price: $290,000
Average Sales Price: $433K
Average List Price: $888K

Notice in the table below there is a very large difference between the average list price and the average sale price. This simply means that currently, most of the sales are occurring only in lower priced properties.

IF YOU ARE INTERESTED IN A CONDO

If you have ever planned to own a Destin condo on the beach, now may be one of your best times because of the extreme market conditions. In addition, you can consider a Destin property by getting into a Foreclosed homes or condos.

Our latest report shows that there are over 180 condos for sale in the $300k to $350k range which is unbelievable for this area. We can almost promise you that you will find some owners willing to wheel and deal to make their pain go away.

IF YOU ARE INTERESTED IN A DESTIN HOME FOR SALE

Let's face it, for almost any price bracket, there is a lot of inventory on the ground, even in the $1Million range right now. However, our sub $200K range is showing very few properties so if you could acquire on cheaply and touch up a bit, it might be a great opportunity.

Coaching Your Real Estate Clients on the 10 Percent Theory of Sales

2008-09-23T21:05:00.001-07:00

I'm not breaking any news by saying that real estate markets have slowed across the country. As a real estate professional, you are well aware of this fact. So instead of wasting time revealing what you already know, I'd like to share a tip that could help you increase your real estate sales -- in a slow market or any other kind of market.

It is the 10% theory of real estate sales, and it's a theory I have embraced for several years to good effect. But in order for the theory to have a positive effect on sales, your clients must understand it as well as you do. In other words, you can help your clients succeed by coaching them on the 10% theory of real estate sales.

The 10% Theory of Real Estate Sales

This principle states that only a certain number or percentage of homes will sell each month within a specific neighborhood, and a house will not sell until it enters into that top percentage of real or perceived "deals." For example, lets say the top percentage in a certain neighborhood is 10%. This means that if a home owner in the area wants to sell their home, they will need to be in the top 10% of real or perceived "deals" within that area. If they are not, they will need to break into the top 10% of deals for next month or the home will still not sell. The actual percentage number will fluctuate with area and time, but the concept itself will hold steady.

What This Means to Sellers

For sellers, the most important thing they can do is get into that top percentage of homes that are selling, and get there quickly! This can be done a few ways, but remember first that perceived value is just as important as tangible value. Perceived and tangible value can be created by a combination of proper marketing, benefits, and competitive pricing.

More often than not, home sellers do not mind the first two factors, but find the third (competitive pricing) to be excruciatingly painful. Despite the pain, real estate owners need to have their Realtors evaluate the market and get their property priced according to what has sold in the current month. This needs to be done quickly, because time is not the cure when new listings are coming up every day. New listings make it even tougher to get into that top percentage.

If your seller client says things like "I can just wait for the right buyer/market" ... or "I don't really need to sell" ... or "I need xxx dollars despite what the research says," then the best advice for that client in this market might be to just get out of the market. This truly is not a time for unmotivated sellers to "play the market" and just see if they can get some unjustifiable price. For motivated sellers who really want to sell, careful adherence to our top percentage principle will help them find buyers and ultimately get their home sold.

What It Means to Buyers

Home buyers also need to understand a few things about the current market. Despite what the headlines read, the best deals on the market are selling, and often selling fast. To illustrate this point, we operate a section on our website that we call the Orange County hot property of the week. In it, we post some of the best deals to be found on property in all types of price ranges. In the current market, we must update this section at least every week and a half. Otherwise, the site becomes outdated and the good deals are no longer available. This speaks volumes as to the health of the market!

Basically, if home shoppers want to become home owners by finding a good deal, they need three things -- good help, reasonable expectations, and the ability to move quickly. The best way to achieve these things is to let a local real estate team help in finding these good homes.

Conclusion

Real estate is a joint effort between the agent or broker and the clients they represent. In order to achieve success, both parties must understand the market in the same way. This kind of shared knowledge comes from the agent coaching the client on the path toward success. And often that path lies within the ten percent.

Short Sale Real Estate Investing - Pit Bull Theory

2008-09-23T21:04:00.000-07:00

You’ve decided to get involved in short sale real estate investing, and you have a deal working. A distressed seller has asked for your help, and you’ve even gotten to first base with the lender. Negotiations have begun, but have stalled out because there seems to be some apathy on the lender’s part for getting this deal done… what now?

Here’s the scenario- Mrs. Motivated called you six days ago with a house she needs to sell right away. Her husband walked out, leaving her saddled with payments of $900 per month, way over her head. She’s two month’s behind, with a mortgage balance of about $110,000, and a house value of about $125,000. Perfect conditions for short sale real estate investing.

Your initial calls to her lender went well. You reached Mrs. Motivated’s collections supervisor, who referred you to the lender’s short sale real estate investing department, otherwise known as “Loss Mitigation”. Ah, lenders and their silly names!

Miss Mercy, in Loss Mitigation, informed you that you would need to submit an offer, accompanied by proof of funds, to her office on a form that she would provide. You happily complied, offering $90,000. Your hopes were high.

Miss Mercy has now applied the brakes in dramatic fashion, thus smashing your cherished little hopes, and those of Mrs. Motivated. On the phone, Miss Mercy expounded for several minutes on her bank’s policy, “never, under any circumstances whatsoever,” to accept an offer lower than the mortgage balance. And here you had been foolishly led to believe that short sale real estate investing was not only possible, but welcomed.

What to do… what to do?

You could definitely turn tail and run for the hills, leaving Mrs. Motivated at the mercy of… dare I say it, Miss Mercy! But that would go against your goal of helping Mrs. Motivated, putting several thousand dollars in your pocket, and being mega-successful at this game called short sale real estate investing. All fine goals which are not, by the way, mutually exclusive.

You could call Miss Mercy and rail against the system, pleading Mrs. Motivated’s just cause, and pulling at Miss Mercy’s heart strings. After all, that’s why you started short sale real estate investing in the first place. Fat lot of good it will do you!

Or, you could do what other smart, savvy, experienced practitioners of short sale real estate investing do… implement Pit Bull Theory.

Pit Bull Theory states, “I will NOT give up until I have gotten my huge, powerful jaws around the throat of the lender and shaken until the deal either closes or dies.”

How, then, does one close their jaws around a lender’s throat and shake?

Simple.

You try back doors, front doors, and side doors, until you run out of doors. That’s what makes short sale real estate investing work, and to find out how to make it work for you, you’ll want to read more about it at Short Sale Real Estate Investing. Go ahead, it's free!

Now, go make more offers!

What Does A Real Estate Seller’s Agent Do?

2008-09-20T12:57:00.000-07:00

There are some home owners who choose to sell without the services of a seller’s agent. The real estate industry calls these types of sellers, ‘For Sale by Owner’ or FSBO. If you are in the FSBO category, then you may find the information below useful.

For some FSBO, you can save a lot of money by not using a Real Estate agent. But you should examine this issue carefully as this decision is more complex than it appears. Below are some of the issues that seller’s should consider before making a decision about selling their own without the services of an agent.

Some background information is necessary at this point. In most real estate transactions, there are two agents involved: a seller’s agent and a buyer’s agent. While not always the case, most often, the seller pays the commission of both agents. A seller who is selling their home without the services of an agent to represent them, usually still has to pay the buyer’s agent who brings a qualified buyer to the seller. So in this sense, a FSBO is only saving half of the commission they would otherwise pay.

With this background in mind, let’s consider some of the services that many seller’s agents provide:

1.Hold Open Houses to show your home to prospective buyers.
2.Mail out catchy postcards and flyers to prospective buyers and other agents to advertise your property.
3.Place newspaper advertisements about your property.
4.Install an eye-catching sign in your yard advertising that your property is for sale.
5.Advertise your home in the MLS and other Internet Web sites.
6.Respond to inquires about your property in a timely manner.
7.Respond to questions from agents and prospective home buyers about your property.
8.Review and summarize the advantages and disadvantages of any offers on your property.
9.Prepare and distrubute required seller disclosure documents on your behalf.
10. Be your guide throughout the home selling process.

There are many other services that seller’s agents can provide. The list above is just a sample. All these services take time, money and/or expertise. If you choose to sell your home on your own, keep in mind that there are many tasks that have to be completed. And when the market slows down, the above tasks may have to be repeated many times until you find a buyer for your home.

Hiring A Real Estate Agent

2008-09-20T12:56:00.000-07:00

ust because you initially decide to sell your home by owner does not mean that you have to stay within this situation forever. Each year, thousands of people decide to sell on their own, but end up hiring a real estate agent within a few weeks. In fact, some people give up even quicker than that. Of course, you should not plan on giving up and hiring an agent, but you never know what is going to happen.

If you have had enough of the for sale by owner process, you should consider hiring a real estate agent. There are many things that they can do for you that you cannot do for yourself. First off, when you talk to a real estate agent they will be able to tell you what they can do as far as marketing is concerned. And this is something that most for sale by owner sellers have a problem with.

You should also keep in mind that real estate agents have a long list of clients who are in the market for a new home. For this reason, they may be able to make a few phone calls and find the right buyer in no time at all. Even though you will have to give up a commission check to your real estate agent, this sure beats waiting around for months on end for a buyer to find you.

If you are going to hire a real estate agent make sure that you do your homework. No matter where you live, chances are that there are hundreds of agents doing business in your area. Many of them will represent the same company, but if you live in a bigger city, there is a good chance that there are several real estate companies in your area. When you search around it will help to ensure that you get set up with the best real estate agent for your home.

It is never too late to get help when selling your home. Even if you have had your home on the market by owner for a year, you can always back out and hire a real estate agent. You may want to work at doing things yourself, but all in all, sometimes this is just not possible. If you get the feeling that hiring a real estate agent is the best way to go, there is nothing wrong with making a change.

Analyzing a Commercial Mortgage Loan - Capitalization Rates

2008-09-18T09:17:00.001-07:00

After we have determined an NOI that we are comfortable with, the next item that we will use in the process of analyzing a commercial mortgage loan, is a term that you probably have heard but maybe not completely understood. This is the capitalization rate or the cap rate of an investment. Simply put, this number represents the return that a buyer of a commercial property is looking to earn on his or her investment, and is also used in the process of trying to place a price on a building for a seller. Needless to say, the cap rate is not an exact science, and depending on whether you are the buyer or the seller of a building, can definitely vary.

Capitalization Rate

Let's say as a buyer of an income producing property, you would like to earn as high a return on your investment as is possible, at a given level of risk. Every city, town and even area within a town will have a cap rate associated with it. Depending on a variety of factors that includes the quality of the area, type of building, quality of tenants, etc., an area will be analyzed at a certain cap rate. Cap rates are not static numbers, but can change over time as the nature of an area changes. A perfect example would be parts of Manhattan that have seen significant cap rate declines over the past 10 years as they have become gentrified.

Net Operating Income (NOI)/cap rate = Building value

Remember that this is a building value based on the cap rate that you put in. As an example, take a building that has an NOI of $80,000 per year, and it is in an area where the cap rate is approximately 7.5%. That is, a buyer in that area wants to earn a return on investment of 7.5%.

$80,000/.075 = $1,066,666

The higher the cap rate or return desired, the lower the value of the building and visa versa.

The mortgage rate on a commercial mortgage loan has to be below the cap rate for the deal to make sense.

If the cap rate in the example above were higher or lower, how would it affect the value of the building?

$80,000/.08 = $1,000,000

$80,000/.07 = $1,142,857

The buyer of a building wants to buy at the highest cap rate possible, and the seller at the lowest. The process of the negotiation of price must begin with a reasonable determination of cap rate for the building and for the area, and ends with some meeting of the minds between the buyer and the seller.

The next step in the process is going to be the most important, and that is going to be determining the debt service coverage, or DSCR, of the desired loan at a given interest rate and NOI that we calculate.

Analyzing a Commercial Mortgage Loan - Net Operating Income

2008-09-18T09:17:00.000-07:00

In my previous article we touched on the basic criteria that make a commercial mortgage loan a much different animal from a residential mortgage loan. In a nutshell, it is the fact that whatever loan amount is desired for an income producing property must be supported by the income that the given building produces. This leads us to the first most important calculation:

Net Operating Income

When you are speaking to a potential borrower, one of the first, if not the first thing that you will ask is (after or at the same time as credit score): Do you know what the net operating income of the building is? Simply, the net operating income, or NOI, is the gross rents of the building minus the operating expenses of the building. Because the NOI of the building has to be able to support the desired loan, it is imperative to get to a very accurate number. This means that we don't necessarily rely on what the borrower is telling us, but look for verification. This is important because any "inaccuracies" will come out during the due diligence process, so once again we do not want to waste our time on a deal that cannot be done. If actual expenses are higher than what we are being told, or actual rents are lower, this can turn what at first glance looked like a great deal into a deal that cannot be funded. A little legwork early in the process can save you a lot of time and effort later, as well as the experience of a deal "crapping out" late in the process.

What goes into the NOI calculation? We need the following:

Gross rents

Expenses

Property Taxes
Building insurance
Utilities

10% of the gross rents to account for management and vacancy

NOI = Gross rents - expenses

Very simple calculation. For verification of expenses, you can use PropertyShark.com for taxes or the assessor's office, and for utilities and insurance ask to see recent bills. As far as rents go, have an idea of what market rents in a given area should be, and ask for current leases. Once again, do not try and manipulate numbers to make a deal that won't work suddenly work. In this business your relationship with a lender is more important than a single deal, and trying to fudge numbers is the best way to lose that relationship. Realize as well, that everything will come out in the wash, or as we call it the due diligence process.

Do You Understand Real Estate Loan Formulas?

2008-09-16T00:51:00.001-07:00

What the real estate loan formula really involves…

All loans are based on a mathematical formula that determines how much you are going to pay. There are five crucial loan variables including: term, interest rate, principal, final value and payment. These are also the five most important terms you need to know before you apply for any loan.

All of them are interconnected and changing any one of them is likely to change the others, though oftentimes not quite as you would predict. There are some rules of thumb about that, but better not rely on them too much. Before you even start thinking about any specific real estate loan you should spend some time learning the variables with a financial calculator.

Term: it is the period used to calculate the loan payment, often the same as the maturity, ie. the time when the last installment is due. Keep in mind though, that in cases the loan maturity is much shorter than the loans term (for example: balloon mortgages). The standard term for a real estate mortgage is 30 years, though in case of amortized loans you can choose a period from 10 to 40 years. Generally the longer the term, the lower the monthly installment, though the change is much smaller than you might expect.

Interest rate: is the amount of money charged by the loan creditor for lending you the money. It is usually a percentage of the sum you borrow. The rate is charged every payment term, but it is customarily quoted on an annual basis. A 6% interest rate is customarily, 12 multiplied by 0.5% (in case of monthly payments). The lower interest rate, the less you have to pay. The effect is greater in case of long-term loans.

Principal: this term can mean either (1) the portion of the installment that is used to reduce the balance or (2) the total amount of money being financed. Generally, the principal (1) should be higher than the interest rate, otherwise you will suffer from negative amortization (your debt will grow even though you pay the installment). The higher the principal (1) is the less is the final value.

Final value: this is the total sum you pay for the loan (all installments plus all additional fees). The final value at the end of the mortgage should usually be zero, meaning that the debt has been paid in full. Keep in mind that the lower final value you want to get, the higher installments you will have to pay.

Payment: your monthly (rarely quarterly) amount due. This important variable determines whether you can ultimately afford a loan or not.

A word of warning: while it is relatively easy to run the formula on a financial calculator, it is very difficult to do that on paper, even if you were good at Math in the college. An online financial calculator is much faster and doesn't make mistakes.

Remember, when you choose a real estate loan for yourself, you have to know all five variables - only then will you be able to determine what you can actually purchase. Oftentimes it is actually better to go for higher monthly payment if it means lower final value. On the other hand, you might want to stretch your loan (longer term and higher final value) to get more money for a low installment... The number of possibilities are immense, but you have to know what they really are if you are going to profit from them.

Good luck with your real estate ventures.

Loan For Commercial Real Estate

2008-09-16T00:50:00.000-07:00

Buying commercial real estate is not usually something that you can do with cash. If you have enough money this is possible, but majority of people look for finance to purchase a property. If this suits you, you will have to find a lender to do business with.

If you want to buy commercial real estate you are going to have to find the best mortgage available. Ofcourse,It’s a long task, take a challenge to get the best possible deal.Every commercial real estate loan has something different to offer,so you have the opportunity to compare each loan details.

Here are three things to consider when looking over commercial real estate loans. Although there is much more to it than this, you should definitely consider these details at the very least.

1. The interest rate that that bank charges for your commercial real estate loan is very important. The lower intrest rate that you receive the less your payment is going to be paid each month. While commercial real estate lenders try to be competitive, some of them offer better rates. It is important that you seek out these lenders.

2. Get your commercial real estate loan from a lender who is reliable and has experience in this area. There are not too many cases of lenders closing up shop and leaving borrowers high and dry, but this can happen.Make sure that you speak only with commercial real estate lenders who are reliable and trustworthy.

3. Take the time to look over every last detail of the commercial real estate loan that you are being offered. Even though everything may look good on the surface, as you dive into the contract a bit more you may find things that are not what you thought they were. Taking the time to carefully read a commercial real estate loan contract will help you out in the end.

There are many lenders that offer commercial real estate loans. You should take the time to speak with many of them to make sure that you get the best loan for the type of property that you are buying. In the end, this will allow you to get the commercial real estate loan that is best for you and your finances.

What Good Is A Real Estate Investing Course If It Doesn't Contain A Marketing Plan?

2008-09-12T23:55:00.000-07:00

You’re a Real Estate Entrepreneur or Investor, and you’re out there in the market place looking for deals. I have a question. for you.

Are you doing a bit of advertising and just hoping that a deal will fall in your lap, or are you operating in a way that makes certain it will happen. If you don’t have a process for making sure deals happen, you don’t yet understand the importance of having a marketing plan.

The sad fact is that even after all their training, less than one percent of all real estate entrepreneurs and investors actually have a marketing plan. Even though it’s very simple, don’t underestimate its power.

The most important thing about marketing is to have a marketing plan!

Why?

A) It’s a concrete result you put out for your mind to seize on and strive to achieve.
B) It allows you to clarify exactly what you want to achieve in the coming 30 days.
C) It allows you map out the activities needed to achieve that plan.
D) It allows you to plan in advance to delegate off the lower paying activities, so you don’t
end up doing them.
E) It allows you set time deadlines, to hold others accountable so everything gets DONE!
F) It results in you being free to concentrate on your highest payoff activity: Making Offers
On Great Deals!
G) You have a business that operates consciously, not by accident.

More people fail in real estate because they simply do not have a plan or goals. You should have a detailed marketing plan of what you want to accomplish and how you are going to accomplish it.

And, don’t be vague, either. Things like, I want to make more money than I can ever spend, and I want to be rich, and I want to make $10,000 a month, are not plans. They are too vague, and they won’t help you get there. Be as specific as you can possibly be.

In planning for monthly revenue, try to put your money goals in cash income, not gross revenue. I know gross revenue is what you’re used to thinking in, but cash is obviously more important. It’s what you take to the bank, and it’s what pays bills.

First, examine your current numbers. More than 80 percent of all real estate entrepreneurs know how many houses they are buying each month, but they don’t know where those houses came from and how many leads they had to process to develop them into the single deal. And, this is a deadly sin.

You simply must know how you are currently doing.

You should know:

1) the total leads that call each month (each week is more manageable),
2) where those leads come from,
3) how many "qualified" seller prospects (i.e. those that you are willing to invest follow-up in if
they don’t sell now; they have motivation, you are interested in the house.) you get each
month,
4) the ratio of total to qualified,
5) the number of deals you close,
6) the ratio of closed deals to qualified leads for each lead source
7) how much you make from each seller,
8) and how much it cost you to acquire a new seller.

With this information you can look at your current resources, look ahead, and then plan out what you want to have happen. The number of deals you want to do, the amount of money you want to make.

For example, let’s say you are bringing in around $10,000 a month and your average deal gives you $5,000. Yes, I know that’s low, but for the sake of example. That’s two deals a month. These are cash proceeds and after expenses you net 50 percent of your gross or $5,000 a month. And let’s say that you want to double your net income next month.

You will have to get twice as many deals to double your business. Goal? Four deals a month, or one a week.

Let’s say you currently gets one deal a month from a classified ad, and one deal a month for mailing expired listings. But, you get ten qualified calls a month from his classified ad and 10 qualified prospects calling a month as a result of mailing expired listings. So, you currently close ten percent of your prospects.

Firstly, you can improve on this situation by improving that twenty percent close ratio. By improving your closing ratio by things like more precise targeting, the present lead-flow would stay the same, you’ll get your same twenty real prospects and achieve your goal of doing four deals next month.

But assuming that’s not something you have control over right now, the other way to double your income in the next month is to double the number of qualified prospects you talk to and make offers to. So instead of getting 20 qualified leads to call, you would need 40.

Your plan to get forty qualified prospects would need 10 to come from expired listing mailings, 16 to come from flyers in target neighborhoods, 4 from business cards handed out everywhere, 6 to come from signs placed in the ground at high traffic count intersections, 10 to com from classified ads that drive people to the website. Total: 46 prospects. Cool! That’s six to spare.

With this number of leads coming in you have what is needed closed four deals and reach your goal of doubling your net income. Actually, it’s more than doubling because your fixed expenses don’t increase with the income.

You should have a monthly plan. Schedule thirty or forty minutes out of one day to make up your monthly plan and see how you did last month. Schedule this time and keep to it. Don’t do any work or take any calls during this time. Keep it strictly for planning. If you do this and you allow yourself to get into the whole spirit of planning, and making things happen on purpose, you will easily double your income in twelve months.

Your monthly plan should include the following:
1) A goal for total net income.
2) A goal for number of deals signed up
3) A goal for number of appointments made.
4) A goal for number of qualified, interested sellers.
5) A goal for total number of leads.
6) Average net income from each deal.
7) The number of prospects you have to generate to reach your goal.

A detailed plan to generate the number of prospects you need. Your plan doesn’t have to be typed out or put into a computer. It can be handwritten on paper. It doesn’t have to be pretty.

Scratch pad plans are good enough. The important part is that you do a plan every single week and keep on top of things.

This is a simple thing to do, but it is just as easy to not do. Blowing it off is the equivalent of you absolving yourself of responsibility for your business. On the other hand, taking the time to think through your goals each month, both for income, and marketing activity, then committing them to paper will make things start happening by plan and put you in control of your business.

The Real Estate Investment Game Plan

2008-09-12T23:54:00.000-07:00

Have you heard of those people who are landlords of a few properties and remain that way all their lives? Now contrast this to savvy real estate investors that use the power of leverage to vastly increase their cash flow. This article strives to highlight one game plan advocated by many real estate gurus to financial wealth.

Firstly, you would want to find a Property that generates a positive cash flow after instalment payments. Thus, successful real estate investors will spend many hours hunting for the property that generates a good cash flow from the rental proceeds after deducting the monthly instalments due to the mortgage. Remember to take into account the trend of rentals as if you purchase a property when the rentals are on the high side, your calculations may fail you when there is a drop in the rentals and you will be forced to sell your real estate investment.

Secondly, once your property has been partly paid up, refinance and free up money to get more property and establish more cash flow. This is critical so that you get multiple streams of cash flowing into your bank account by virtue of the difference between the rental and the interest instalment payments. However, always remember to keep a sizeable cash reserve in case there is a downturn in the economy and you may find it difficult to get tenants to cover your interest instalment payments for your real estate investment.

Thirdly, once the amount of property that you own increases, exchange your several properties for larger commercial property. Many hotel owners started out in this way and along the way made more and more acquisitions and let hotel management companies run the hotels. Once you reach this stage, your real estate investments would have reached a good size and you would have made your money.

Step Four: Repeat the above process

In conclusion, making money with real estate investing requires a good well through out strategy and game plan. Spending time dwelling on the big picture when you are in the middle of a real estate deal will help you get a sense of perspective so that you do not get lost in the deal to forget the reason why you are involved in it in the first place.

Note this is only one method that you can use to make money with real estate investing other profitable strategies include doing up and flipping and no money down strategies. The key is to find one that makes the most sense to you and one that you think that you can use and apply on a consistent basis.

How To Build A Successful Real Estate Websites That Brings Tons Of Real Estate Leads

2008-09-10T07:01:00.001-07:00

Do you want to build a successful real estate website that is going to bring in more real estate leads than you know what to do with? If you said yes, then you are in luck. We are going to talk about different ways that you can increase the leads to your real estate website, and in the end, be more successful than you ever dreamed of.

After all, there is a big market out there for real estate right now. However, just because there is a big market out there does not mean that you are going to do good. You have to first generate a lot of leads to your website. So now we are going to talk about tips that can help make your website the best that it can be, and get the most out of it as well.

The first thing that you are going to want to do for your real estate website is to build a landing page. A landing page is the page that your leads are going to land on when they click on one of your many ads. It is very important to have your landing page be different than your home page. That is because a landing page is just suppose to give a little bit more information on what the ad was talking about. If you take them right to your website they are going to get overwhelmed. The best way to get leads is to break them in easy.

Next, create a lot of keywords rich pages for your real estate website. To look for keywords that are searched for the most, you can go to any search engine and look for their most searched keywords.

However I recommend to use keywords research tools like keywords discovery to identify keywords related to your niche or location. You are going to want to work these keywords into the text of your website. Another great thing that you can do is to include these keywords into the title and subheadings of your website. When search engines search sites, the main thing that they look for is headings.

Next, you need to make sure that you increase your link popularity. The idea is to get inbound links on many relevant websites as possible. The more links that you have out there, the better. This is how search engines will rank your site. So not only will you get a lot of leads from the search engines, but you will get a lot of leads from the links you have out there pointing to your website. I like to use article marketing to build my link popularity. The key is to submit 2-3 articles each day. Your articles will act like a viral marketing tool spreading your links all over the internet.

Nowadays Realtors who aren't utilizing the internet as a key marketing tool are really missing the boat. Statistics show that internet users looking for a home online are increasing steadily and that is not going to change anytime soon.

To Your Success!

Tips For Buying An Affordable Home From Cincinnati Real Estate And Northern Kentucky Real Estate Remax Agent

2008-09-10T07:00:00.000-07:00

Home loans can be available from several types of lenders--thrift institutions, mortgage companies, commercial banks, and credit unions. Various lenders may quote you different prices, so you should contact several lenders to make sure you�re getting the best price. You can also get a Cincinnati home loan through a mortgage broker. Brokers set up transactions rather than lending money directly; in other words, they will find a lender for you. The broker�s contacts to several lenders can mean a bigger selection of loan products and terms from which you can choose.

There are many factors to consider when looking for a home

Types of Cincinnati homes - There are many different types of homes: single family, condominium, townhouse, and duplex. Additionally, the type of home you select may impact your buying power.

New or existing home - Consider whether you want to move into a new home or an existing home. In general, new Cincinnati homes are more costly than existing homes. However, the condition of an existing home can significantly increase your maintenance requirements.

Quality of home - Examine the condition of the home. Carefully inspect the structure, interior and exterior of the house for defects. The additional renovation costs may add up over time and exceed your maintenance estimates. Will the house need a lot of repairs? How old are the appliances? The purchase of the home is one step, but the renovations and repairs are added costs that need to be considered. Would you prefer to purchase a newer, costlier home or would you prefer to invest additional time and money into renovations and repairs for an older, less expensive home?

Features - Consider the features of the home. Does it have gas or electric heating? How many bathrooms does it have? How many bedrooms do you need? All of these characteristics will influence the price of the home and your monthly housing expenses. HUD's Wish List worksheet (A PDF Reader is necessary to view this file. PDF reader options for the visually impaired.) can help you identify and prioritize the features you are looking for in a home.

Location - Would you rather live in the city, the country, or the suburbs? Do you want to be near parks or the library? What about a shopping center? Is it important for you to be near major highways or public transportation? Get a feel for the surrounding area by exploring the Cincinnati neighborhood and talking to residents.

Crime rate - Look into the safety of the Cincinnati neighborhood. Does the Cincinnati neighborhood have a high crime rate? Has there been an increase in crimes committed in the area? If so, how will this influence the future property value of your home?

School system - The quality of the school system in a particular area is not only important to families with children but can influence the property value of your home.

Economic stability of area - The economic growth and stability of the area surrounding a Cincinnati home can influence its future property value.

Cincinnati Home tax - Examine the annual amount of Cincinnati real estate taxes and other assessments levied on Cincinnati homes in the Cincinnati neighborhood you are considering.

Brokers will generally make contact with several lenders regarding your application, but they do not have to find the best deal for you unless they are contracted with you to be your personal agent. You should also consider contacting more than one broker, just as you would with banks or thrift institutions.

Knowing if you are dealing with a lender or a broker may not always be cut and dry. Some financial institutions work as both lenders and brokers. And most brokers� advertisements do not use the word "broker." So be sure to ask whether a broker is involved. This information is important because brokers are usually paid a fee for their services that may be separate from and in addition to the lender�s origination or other fees. A broker�s compensation may be in the form of "points" paid at closing or as an add-on to your interest rate, or both. You should ask each broker you work with how he or she will be compensated so that you can compare the different fees. Be prepared to negotiate with the brokers as well as the lenders.

Practicality In Real Estate Planning

2008-09-10T06:59:00.000-07:00

One of the biggest mistakes a seller can make is putting the wrong price tag on his or her home. Sellers tend to put a very high value on their property out of fear of losing profit, but buyers won’t even look at homes that are priced too high. There’s no fixed formula to pricing a home. Usually the market value of a house is based on comparable sales, but there are other factors that should be considered like location, market movement, demand, and the house’s condition. Don’t listen to your agent when he or she overstates your house’s value and makes you sign an overpriced listing. As a seller you will lose your competitive edge if you change your mind and reduce the price later on.

Ever seller wants to make sure that his or her home gets top dollar. Careful planning and making your home presentable is the key to make buyers rush to your front porch with their checkbooks at hand. To prepare your home for the big sale, remove all personal belongings like photographs and heirlooms – you want your buyer to imagine THEIR stuff on your walls. De-clutter and throw out any junk you won’t need; this will make moving out easier too. Make minor repairs on things like leaky faucets, doors that don’t close properly, and holes in the wall. Finally, make your house sparkle by cleaning off cobwebs, vacuuming daily, and waxing the floors.

When there’s a slow down in the market and a decline in home sales, anxious property sellers slash their prices just to make a sale. You probably don’t want to sell your property at a lower value, but if yo keep your price high your property won’t budge. Offering incentives is something that you can do to stay ahead of the competition and get the asking price you want.

Some incentives you can include are high-end appliances, free security systems, granite kitchen counters, an in-ground swimming pool and free pool maintenance, or a prepaid loan on a vehicle. If you don’t want to do this, you can also give financing incentives by buying down the interest rate for the potential buyer or offering your own financing program, which will give a lot of benefits to both you and your potential buyer.

To make sure you get the maximum value out of your house before you sell it, you need to treat your home as if it were any other consumer product. Here are some things you can do to put yourself in control of the selling process.

Walk through your home, look at it objectively, and see what needs improvement. Look for defects buyers might not like, such as stains, peeling paint, or cracks on the wall.

Fix any cracks in your tiles or walls and put on a new coat of paint - you’ll be amazed at what a dramatic change new paint can do. Pay special attention to the kitchen and bathrooms as buyers are very particular about them.

Depersonalize your home. Removing all personal effects will make it easier for buyers to imagine themselves living in your home.

Rearrange your furniture to make your house look bigger. The less clutter there is, the better everything will look.

Real Estate Loans

2008-09-09T06:57:00.001-07:00

Real estate loan is what a lot of people use to buy their home. Real estate loans have been instrumental in bringing joy to people by making that unaffordable house affordable. Some real estate investors too make use of real estate loans for buying properties. However, real estate loan is not free money and anyone who buys real estate or plans to buy real estate using real estate loan must understand the concept of real estate loan very clearly.

Real estate loan (also known as mortgage) is the money that you borrow from someone (a financial institution i.e. a mortgage lender) for the purpose of buying a property. The real estate loan generally covers a part of your purchase price and the remaining portion has to be paid by you upfront i.e. as down payment. The amount (i.e. the percentage of total purchase price) that you have to pay as down payment is dependent on a number of factors and you can generally reduce it to even 5% by going for mortgage insurance.

Whatever you borrow from the mortgage lender as real estate loan needs to be paid back to the mortgage lender over a period of time (and, of course, you will also need to pay appropriate interest on that real estate loan). The tenure of your real estate loan and the prevailing market rate will determine the amount of interest you pay for your real estate loan.

Generally, you are required to pay back the real estate loan in the form of monthly instalments which are composed of both interest and principal portions of your real estate loan. Also, there are various types of real estate loans e.g. fixed interest rate loans and adjustable interest rate loans. So depending on what type of real estate loan you have gone for, your monthly payments might either remain constant (fixed rate) for the full tenure of the loan or keep getting adjusted periodically (adjustable rate) on the basis of a financial index. Besides that, some other costs are also associated with real estate loans e.g. there are closing costs, inspection costs, attorney fee etc.

Also, in case the property needs some repairs, there will be costs associated with that too. Again, there is stamp duty and other taxes that you need to pay.

So, really, you need to understand the concept of real estate loans and the related costs clearly before you actually go for the real estate loan. And understanding these concepts is really not that tough.

How to Make Money in Foreclosures

2008-09-09T06:56:00.000-07:00

The American real estate market has witnessed a dramatic rise in foreclosures in the recent years. The foreclosure is not a happy incident letting go of one’s house never is. The basics of the foreclosure vary from state to state; everyone loses money except the person investing in the real estate.

When a loan is made in favor of buying a piece of property, the loan is made under a mortgage agreement. The mortgage means that the owner of the property must pay up on a regular basis to the lender which in most cases is the bank or risk losing the property for good. When the borrower turns into a defaulter and fails to pay a certain number of monthly installments then acceleration occurs and the entire balance of the loan is due.

In such a case the home owner is left with no other choice, but to vacate the house and wait for its auction. If you are a real estate investor here comes the part that will interest you the most, the banks want to retrieve their money from the market in the fastest possible way. So they make the repair work and patch up the house, which is usually in tattered conditions, and then put it up for sale in a discounted price.

Most often the price quoted by the bank is lower than the ongoing market price of the property, this makes up for really good real estate investment. Most if the times the owner does not want a foreclosure to show on their credit reports so they short sell their houses at lower rates. So although their dues will be shown as paid in the credit reports but it will also be stated that they settled their loans with a sum of money lesser than the actual loan amount.

Some times the owners may not derive any profit from pre foreclosure sale but the relieving of the financial burden is enough, so you can expect to make good bargains with such sellers.

After the property has been acquired, the real estate investor will need to repair the property, as the house will most definitely need some repair work to be done. Now before buying the house you must ascertain the amount of repair work you need to perform so that the house can be made livable and listed once more.

After the repairs have been completed a real estate investor can either sell of the property at a higher price, to other prospective buyers, thereby making a huge margin of profit. Some investors prefer to keep the houses in the market so that the prices soar but they do not sell it because they want to keep it for the future.

Or else they can keep the house as an asset and give it up on lease so that they can receive a permanent source of cash from the house. So as we see it the future of the real estate foreclosure business is very bright indeed and there is no reason why you should not invest in it if you have sufficient capital.

4 Ways of Creating Multiple Income Streams With Real Estate

2008-09-09T06:55:00.000-07:00

"Choose life. Choose a job. Choose a career. Choose a family." These words were spoken in the 1996 movie "Trainspotting". It was the beginning of a monologue outlining the average person's walk through life, with the idea that you get a job and work at it until retirement age, then retire to spend the rest of your life doing whatever you think retirees should do.

Multiple income streams can change that. You can start out modestly, but your returns over time for a relatively modest investment can mean quite a lot. You might even see your returns pay for your bills, leaving you free to take or leave actual jobs. Even if you don't make quite that much, chances are that your returns will leave you in a much better financial position than otherwise.

Real estate has always led the pack when it comes to income. Many wealthy people got that way by quietly investing in real estate. Real estate investment isn't the only way you can create alternative income, though. Here is a list of possible income generators involving real estate.

1. Investment rental properties

Always the favourite of people who want to quietly amass wealth, investment real estate is one of the most reliable investments you can make. If you can get an investment property for no money down and rent it out, even for just enough to pay the mortgage, you're laughing all the way to the bank. If you build equity while someone else is paying your mortgage, you can end up selling for thousands more than you owe, leaving you with a nice chunk of change in the bank. If you are getting more in rent than the property costs you each month, then you've got a stream of income that you don't have to get up and work for.

Cons are property upkeep and not being able to find reliable, responsible renters. You also need to set aside money for property maintenance and any fees not taken care of with your monthly payment. Know your renter market and buy to suit what people are looking for in a rental property.

2. Write about real estate

If you're passionate about real estate, write! There are newspapers, magazines, websites and books waiting to hear from you! E-books are another income generator that you could explore. It helps if you can string a sentence together well and have a wholesome respect for spelling. If you have a talent for getting other people excited about real estate via the written word, you could set yourself up for a nice little income stream that can be generated in your spare hours.

Cons are that not everybody has the ability to transfer their knowledge into engaging prose. Good writing requires a significant outlay of time and effort that some people are just not able to invest. The market for writing, even good writing, can fluctuate and it may take some time to establish yourself as a good, reliable writer.

3. Invest in P2P lending

P2P, or person-to-person, lending is taking off with a plethora of companies setting up websites that allow people to request and invest in loans. The most popular in the US is Prosper.com. Basically, if you invest in a loan, you can name your interest. If you are accepted as a lender, you can get a return of 10-50% of your loan over a period of several years.

Cons are that, despite the stringent requirements of many P2P lending companies, your borrower might take your money and run. Or be late with payments. Or start out well and then stop paying... this is a very new investment item and, despite it's seeming simplicity, requires some critical thought before investment.

4. The wonderful, wonderful Web

This kind of goes back to #2... if you've got valuable information, think about disseminating it via a webpage and selling adspace. Blogs are all the rage now - if you get a reader base, it all means money for ad clicks. Consider Google Adsense for a starter ad, but there are a lot of companies who are willing to pay per click.

Cons are the knowledge of writing mentioned in #2 and the need for a modicum of knowledge of how the Web works and how to create and market a website without being written off as spam.

Realty Sector is now the new profit reality

2008-08-31T10:28:00.000-07:00

Summary: For several reasons like favorable skilled demographics, a liberal Govt. policy, IT and retail boom, the global perception towards Indian economy is changing fast. This positive change has helped the Indian reality sector to boom.

Construction and development segment is one of the fastest growing sectors of the Indian economy. This segment is augmenting investors. Even the real estate prices are augmenting fast, especially in metros and upcoming cities like Bhubaneswar, Kochi, Pune and Nasik. This rapidly growing market is maturing day by day as large numbers of people are taking part in it.

Flying high on the wings of this booming sector, property in India has become a dream for every prospective investor looking forward to dig profits. All are eyeing Indian construction and development sector for a wide variety of reasons:

* India is a growing economy with a continuous rise of 8 percent for last three years. This growth has increased purchasing power of Indians and created demand for reality sector.

* India is producing 2 million new graduates on an annual basis. This necessitates a demand for 100 million square feet of office and industrial space.

* The global perception towards Indian is changing fast. Presence of a large number of Fortune 500 and other major MNCs has created a feel good atmosphere in the Indian economy. This positive change will attract more companies to initiate their operational bases in India and will create more demand for corporate space.

* For investment purpose, India is a safe destination. According to a recent survey, 70 percent of foreign investors in India are making profits and another 12 percent are breaking even. This statistics is powerful enough to attract more and more FDI in Indian reality sector.

* The relaxed FDI rules implemented by Govt. of India last year has invited more foreign investors. After the decision of 100% FDI in this sector, real estate in India is seemingly the most lucrative ground at present. The revised policies are very much investor friendly and have allowed foreigners to own property. Now government of India dropped the minimum size for housing estates built with foreign capital to 25 acres (10 hectares) from 100 acres (40 hectares).

• Apart from IT, ITES and Business Process Outsourcing (BPO) India has shown its immense expertise in sectors like chemicals, apparels, pharmaceuticals and jewelery. In these sectors India can match the best in the world. These positive attributes of India is definitely going to attract more foreign investors in the reality sector in near future.

Determine the profit on your Real Estate sale

2008-08-31T10:27:00.000-07:00

Most people look to compromise in their area to come up with the listing price for their property. This is logical, but you also have to hub on the bottom line.

How Much Would You Make on The Sale of Your Property?

It happens more frequently than you might imagine. A homeowner decides to sell and goes about figuring the top price to sell. They might set a price off of the cuff or does study to ascertain the best price that will result in a sale within a specific time period. What many do not take into account, nevertheless, is the ultimate amount would get from the property. This could lead to brutal surprises when the eventual amount is much less than expected a concept known as seller’s remorse.

In realism, the decision to sell your property must only be made after determining what you could objectively get out of it. Most people, however, lean to eyeball this amount. If you have a lot of justice in the property, it in fact is not an issue. If you don’t, you better start calculating or you can be in for a bad shock.

The first place to start is the predictable price you would sell for minus the outstanding balance on your mortgage. This gives you a rough estimate of your equity, but must not be relied upon as the final cash out figure. Instead, you have to sit down and start calculating the other costs such as:

* Mortgage pre-payment penalties,
* Property taxes for the part of the related year in which you are selling.
* Any costs connected with repairs to the property to get it in shape to sell.
* Attorney’s fees if a lawyer is necessary to be part of the process in your state.
Incidental costs connected with the sale as agreed to in the purchase agreement with the buyer. Items could include title insurance premiums, recording fees, examination fees, warranty insurance, escrow fees and so on.
One area people totally forget to factor in is, ironically, the main expense. If you use a real estate agent, you are going to pay an important commission. A typical 6 percent commission on the sale of a $300,000 home is $18,000. More and more sellers are bypassing this by selling their properties without agents, which makes brains given the money involved. Regardless, you require ascertaining how you would sell the home and the relevant cost of doing so as part of your overall calculation. Making the choice to sell is an emotional one. It should, however, also comprise a hard, cold look at the financials involved and whether doing so makes sense.

Home Loan Process - What Are The Organizations Involved

2008-08-28T11:36:00.001-07:00

In order to get a home loan, people and organizations such as inspectors, real estate agents, credit agencies, title search people and others need to sign off on the project. Who they are is usually dictated by the home loan people but having them all lined up and ready to sign off is up to you.

Who is involved?

The people and groups involved in getting the home loan issued include: you, the lender, the real estate agents (for you as well as the seller), the inspector, the title company, your creditors, your employer and your spouses' employer and credit history if the purchase is to be a joint purchase.

The home loan lender

This group can be a bank or other financial organization. Generally, they are the ones that require all the paperwork to let the home loan proceed. Unfortunately, they are the ones that require the information and are not necessarily the ones who pull it together. The documentation for the home loan is largely your responsibility although the home loan lender will likely verify the financial details before the loan proceeds. Generally, having as much documentation pull together before hand is a wise idea.

The real estate agents

The real estate agent can be a good guide for getting you through the maze of home loan paper work. They have been through the process before and have a fairly good idea what to expect. They are not responsible for pulling information together but can be a good resource for finding and using reputable people during the process. Title search and inspection companies might be a good example of resources they can help locate.

Inspectors

The inspection process is a requirement for most home loans. Generally, this process is a good idea in any event. It is always good to know beforehand if repairs or upgrades are going to be likely in the future. However, if the inspector finds that the home has significant issues the home loan may not be able to proceed. Unfortunately, in this instance, the search for a new home will need to go on. Fortunately, most of the home loan paperwork has been completed so this event is more of a disappointment than a home loan disqualifier.

Title Search Company

This company's work can be the scariest work in the entire process. One might think that the process has been done before so there should be little issue. Unfortunately, this can sometimes not be the case. The home loan company wants to know that the property is free and clear of encumbrances. If it is not free and clear there cannot be a sale. Generally, the scary part is that when something is found it comes out of nowhere. Where title searches are concerned Murphy's Law applies; if something bad can happen, it will happen.

Credit Help for Real Estate Financing: Five Categories of Your Credit Score

2008-08-28T11:34:00.000-07:00

1. Payment History -- 35%

The number of accounts paid as agreed and a good payment history give you a higher score.

Negative points lower credit scores because of 30 days, 60 days, and 90 days late on any debt. The dollar amount of these delinquencies also impacts credit scores. Severity of delinquency, how long past due, and number of delinquencies are nasty remarks on some credit reports. The older these derogatory items are, the less impact they have on credit scores. You do not want any present delinquent accounts when applying for a real estate loan.

Never, ever pay a mortgage payment more than 30 days late. Lenders do not like to see any delinquencies on real estate loans.

Adverse public records, such as bankruptcy, judgments, suits, liens, and wage attachments negatively dominate credit history. Any of these items cleared up helps improve a credit score, unless the item is aged. The older the derogatory entry, the less the impact. Any activity on a particular item makes the item update and therefore, remain on the report for another seven years. So, if a derogatory item is more than four or five years old, don’t bother with it.

Collection items unfavorably shape credit payment history. The more age a collection account has, the less its consequence. Most mortgage companies require that collection accounts be cleared before lending. If this is your problem, see “Help with Collections” later in section six.

2. Proportional Amounts Owed -- 30%

The amount owed on a credit line compared to the available credit is termed the proportional amount owed. With a credit card limit of $5,000, the score will be higher if less than $2,500 is owed. Even better is to owe less than 1/3rd of the available credit or less than $1501. To have the highest proportional amounts owed scoring factor, owing less than ten percent of the available balance gives you the best possible rating. On the other hand, owing over $4,500 on an account with a limit of $5,000 lowers your score significantly, especially if you have too many credit cards and other loans with high balances compared to available balances.

Tip: Call your creditor and ask them to raise your available credit as long as you don’t use this credit. This raises your proportional amount owed scoring factor.

To raise your credit score dramatically and quickly, pay down as much as possible on each credit line instead of paying off one credit card at a time. If a credit card is totally paid off, it does not compute in the proportional amount owed; therefore your rating does not benefit from paying balances in full. On the contrary, paying balances in full takes the account out of the equation and you don’t get higher points for the low proportional amount owed.

3. Length of Credit History -- 15%

Any account over twelve months with a good payment history helps a credit score if the balance is not too high compared to the available credit. Six months is the minimum length of time to establish credit. The time since accounts opened and the time since account activity are factored into the length of credit history.

4. New Credit -- 10%

Whenever you apply for a new credit line, your score receives a negative hit. The more inquiries you generate, the lower your score. Obtaining new credit lowers your credit score. We only apply for credit when applying for mortgages. Every time we get a new mortgage, our credit scores go down.

Never finance a new car or get a new line of credit when you are getting ready to finance property. Wait until after closing to apply for further financing. Be aware that after your new loan shows up on your credit report, your financing abilities shrink. If you need credit funds for any reason, including renovation costs for your new house, apply for this after closing your property purchase.

5. Types of Credit Used -- 10%

The different types of loans taken out by consumers affect credit scores. Credit assessors view mortgage accounts more favorably than consumer finance accounts. Too many installment loans, auto loans, and department store credit cards affect credit negatively. To improve your credit score, pay off installment loans and consumer finance company accounts after you have lowered your proportional amounts owed. Then pay off your department store retail accounts. Keep balances as low as possible on home equity lines of credit because they often count as consumer finance accounts instead of mortgages. Achieve higher credit scores by having only mortgage accounts and a couple of major credit cards with low balances.

Note: In addition to credit scores, lenders consider length of time at residence and employment as well as income and education.

Do You Need a Credit Score of 700?

Don’t believe it! We have so many loans; our scores are in the mid 600s, but we buy and sell property all the time. Even with a perfect payment history, we can’t get our scores up because we have so many real estate loans with high balances remaining. We often need to get “B” loans instead of “A” loans, which means we pay higher tax-deductible interest, points, and fees.

The 5 Most Common Mistakes Homeowners Make When Shopping For a Mortgage

2008-08-24T07:42:00.000-07:00

Chances are your home is your most valuable asset. You don't want to make a mistake that may cost you thousands of dollars or potentially put your family's home at risk. Close Your Own Loan.com has compiled five of the most common mistakes homeowners make while shopping for a new home loan.

1) Keep it private

Identity theft is the fastest growing crime in the United States. Many Loan Officers, or criminals posing as Loan Officers, will request your personal information including your social security number and date of birth up front. Do not give it to them. Any reputable company will be able to give you a rate and payment quote up front before you give them your personal information. By keeping your personal information secure you will accomplish two things:

a) You will keep your credit score high by avoiding unnecessary credit inquiries.
b) You will keep identity thieves far away from your personal information.

2) Use YOUR judgment

A recent survey of homeowners in foreclosure with adjustable rate mortgages revealed that 85% of them stated they would not have taken the adjustable rate mortgage had they not been talked into it by a Loan Officer. Often a Loan Officer will try to talk you into an exotic adjustable rate mortgage simply because it pays a higher commission. Do not let their greed determine your next home loan. Explore all of your different loan options yourself in an environment free from sales pressure.

3) Ring, ring, ring...

Have you ever made the mistake of applying on one of these "get multiple quotes from different lenders" websites? I bet you were surprised when they sold your information to dozens of different mortgage brokers who then bombarded you with phone calls for weeks trying to talk you into refinancing with them. Is that what you really want when you go online looking at home loan options? If you wanted to talk to someone on the phone, wouldn't you have called them instead of going online? Don't fall prey to these information brokers.

4) Up front fees

Some mortgage companies will ask you to pay a credit report fee, application fee, or rate lock in fee up front. Any reputable mortgage company will only charge closing costs once the loan has closed.

5) The guessing game

Interest rates fluctuate daily. Many homeowners will see their new rate and payment and decide to wait hoping that interest rates will drop. While you might get lucky and guess correctly, can you really afford to gamble with your family's home? If the new home loan payment offers substantial savings over your current total payment situation, don't be afraid to lock in your rate and savings. Trying to time the market to save an extra .125% in interest is simply not worth the gamble if rates go higher.

We hope you will find this information helpful in avoiding the pitfalls that those before you have fallen victim to. Please feel free to explore our Interest Rate Guide to learn more ways to lower your rate, improve your credit score and Close Your Own Loan.

Questions to Ask Potential Real Estate Agents

2008-08-22T06:57:00.000-07:00

If you're buying a house, chances are you'll be employing the aid of a real estate agent to guide you through the process. The important thing to remember is that you are technically their boss. They should be working for you, whether you're buying or selling a home. That's why it's so necessary to interview several real estate agents before settling on one. Here are some helpful questions to narrow down the candidate field.

1. How many years have you been working in real estate?

Although some agents may be newly licensed, they may have been working on other areas of real estate that will be helpful to you. Any previous experience working with home buying and selling will make an agent a valuable asset. Many times realty is a second or third career. If your realtor was a mortgage lender before switching to the housing world, they might be even more helpful than someone who has been in the business since the word go.

2. How many homes do you sell yearly?

Numbers count, but be aware that small numbers aren't always bad. An agent may only sell a handful of properties each year, but if they're worth millions, that's all they needed to. That's why it's important to ask not only how many they sell, but the price range that the homes fall into. If you're buying a house, this will help you gauge which houses the agent has access to and is more experienced with selling. If you want to sell your home, this will be a good indicator of whether or not the realtor is going to successfully market your property.

3. What is your area of expertise?

If you want to buy a condo, don't hire a realtor who sells mansions. If you want to buy a family home, don't hire anyone who specializes in two-person town houses. Finding niche agents will open more doors during your house hunt or sale. Buyers will be shown more properties matching their requirements, while seller's homes have a better chance of being marketed more effectively.

4. How many other clients are you currently working with?

Translation: How much time can you devote to my needs? Some realtors won't turn down a client, even if their plate is already overflowing. Ask for the numbers. If the phone is ringing off the hook during your meeting and papers are flying, you may want to look elsewhere for an agent who can devote a good chunk of time to you. Explain to them your typical schedule and what times you'd you would be available to view houses or have meetings. If they can't be flexible, move on.

5. Do you have a list or client references?

Nothing says more about the professionalism and worth work ethic of a realtor than their ability to provide you with a list of client references. Just producing a list on the spot is a good sign that the agent is prepared and wants your business. If there is none available immediately, or the agent sputters out some excuses, take it as a sign to head elsewhere.

The Real Estate Agent Income Crisis - There is a Way Out

2008-08-22T06:56:00.000-07:00

Many real estate agents are suffering financially. Possibly this is you. It is unfortunate but houses are selling much below their value and are staying on the market for months. There are more sellers than buyers and there is no relief to be seen in the very near future.

People are struggling; struggling to pay bills to pay debts. The real estate industry is a tough market to be in right now. Possibly you have been wanting to find a way to get you through.

One of the best solutions is to start a home business. There are many tax advantages and you have the benefit of writing off many of your household expenses at tax time. It is also flexible. Something you can do while still being a real estate agent. Maybe something to tide you over until the economic situation improves or maybe something that permanently creates an income for you. The key is to find the right business. One that is recession proof.

We have chosen to build a recession proof business and are helping others to do the same. When searching for any home business there are some critical evaluating tools you need.
Want to Work from Home? Have you considered These Crucial Evaluating Tools?

So you have decided that you would like to work from home. Maybe you want to stay home with your children, maybe you want money for that extra special something or maybe you want to create financial freedom. Maybe you just need to pay your bills and pay off debt. So you know your reasons why. This is a great start but now what?

It is easy to want to jump into the first thing that comes along. Something may sound good on the surface, so you should jump right in, right? Wrong.

There are several key factors that anyone and everyone should consider when deciding on what business would be right for them. Ensuring you have thoroughly researched the opportunity can save you a lot of money, a lot of time, and more importantly, a lot of heartache. I have heard too many stories of people going broke trying to find the right one. I even know someone who has tried 23 opportunities before finding the right one. Can you imagine?

The first key in researching a business is knowing what features you should be looking for in a company. You will definitely need to know the following:

- Is there an established track record?

You want the company to be at least seven years old - successful home-based business companies experience a surge of growth in their first 3-5 years, but most cannot support the increased capital and organizational needs this growth demands to continue their success. Be wary the person who says "this is a ground floor opportunity" or you need to "catch the wave".

- Is the company financially sound?

You should be able to get access to this information. Another great way to know if a company is legit, is trustworthy and has integrity is if they will let you see their previous years' income statistics. If they're not willing to share what their business people make, do you really think they're doing that well. And I don't just mean the top earners, find out what the "little guy" is making.

- Do they have a strong management team and company credentials?

Beware! There are some companies out there who are "touting" scientists behind their products that have received their degree by mail order over the internet. Do your research! What is the history of the management? What awards have they received? What does the Better Business Bureau have to say about them?

- Does this company have unique, consumable products that are guaranteed?

There are companies that have only one product. How many of that one product do you think you have to sell to make any money? If this is a luxury item, you most likely won't get repeat sales from the same person which creates much more work for you. If it's a hobby, you are looking at the same thing. The product should be something that a person goes through and needs again fairly soon, preferably monthly. These products should also have a 100% guarantee.

- Does this company require that you keep inventory or 'front end load'?

This is a very fast way to the poor house. I know lots of folks who have garages full of products. You may think it will be easy to 'unload' it but it's not. Make sure the company does not require you to have stock or inventory.

- Is there a low personal production requirement?

Essentially, this means how much of their product do you need to order to stay in business? If they are asking you to order more than you would use, then you guessed it? Straight to the poor house for you.

- Is there a high customer re-order rate?

Some companies have a re-order rate of only 5%. Does this tell you how hard you will have to work to win customers and keep them? Again, if the company won't give you this information then they have something to hide!

- Is there low initial investment?

You should be able to get started in any business for $500 or less. In addition, any investment should be guaranteed. Any more than that and the risk sky rockets.

- Is there low attrition?

If more than 10% of the people are leaving every month, what does that tell you?

- Is there breakaways?

No breakaways!!! What that means is that you work really hard and then when you reach a desired level, they have the rest of your team "break away" from you and you start all over. Does that sound like what you are looking for? Know the compensation plan. You should be able to earn an income from each person you offer your product or service to. No breakaways, no balancing sides.

- Does the company have any risk?

Risk is a 4 letter word. It has its place but not in your business. This is your life. There should be no risk. You should only be using products you would use anyway, and there should be a full guarantee on everything. If this is the case, there is no risk!

Alright, so now that you know what is important to look for in the company, what product concept makes the most sense, you ask?

REPEAT Consumables (necessity items) and I can't stress this enough. This is a 200 billion dollar industry. People must already want or need to buy the products. It is much easier to interest people in something that is better or less expensive than their current brand than it is to get them to buy something new that they hadn't considered before. The concept of "switching stores" works best because people spend "no new money", they just switch brands. Durable goods won't generate residual income because people won't buy each month.

The products should always be competitively priced (have a low cost per use). No matter how well people like something, they won't stay customers forever if the product costs more than the store bought equivalent. Since commissions depend on customer purchases, the longer they stay, the more RELIABLE your income. The products must also be unique and exclusive to the company. It is of benefit if there are patented products that have been scientifically developed. The re-order rate should be above 90% and it has to make sense to just be a customer, continuing to buy the products without being a business builder.

Lastly there are a few more things that you may want to consider. Does the company manufacture its own products? Does the business offer a system that you can duplicate for success? Does the organization provide you with free training and support? Do you have to leave your home to build the business? Do you need experience in sales or business to be successful? Can you make enough to replace your income? What are the tax advantages to owning a home-based business?

I know this seems like a lot of work, but the end result will make for a happier, wealthier you. Good luck in your search!

Focus Your Way to Real Estate Wealth

2008-08-22T06:55:00.001-07:00

Last night, as our dog Bram was drooling over Dave eating crackers and cheese, my Mom said:

If we all could focus on making money like dogs focus on food we would all be millionaires by the time we turned five.

Ok, five years old is a stretch but my Mom is definitely onto something. When you make something your focus, even just for an hour, how much do you accomplish? In this day and age of blackberries and iPhones, very few people focus on any one thing for long. So, think of the power of actually giving your biggest goal one hour of 100% attention every day. What if you focused an hour a day on building real estate wealth?

This means that you would spend one complete hour every single day with the sole goal of building your real estate wealth. What would you do with that hour if you are just starting out? Here are some ideas:

Before you do anything - figure out what your goals are! How can you focus your way to real estate wealth if you haven't defined what that wealth is, or how you want to achieve it?
Read a book about real estate investing. There are some great books out there that will help you learn the basics. If you are Canadian, I highly recommend you read Making Money in Real Estate by Douglas Grey.
Research property values in your target area (and if you don't have a target area, then you should be researching potential areas looking for places where there is going to be some positive changes to the economy or the housing market).
Research real estate agents and property managers for your target area, and start making calls to find people that you would be comfortable working with.
Speak to a mortgage broker to get a handle on your financial situation, and what you can qualify for in an investment.
Visit open houses in your target area.
Start researching rental rates in your target area by reading newspapers, checking craigslist and other rental websites.

I am sure you can think of so many more things to do to move yourself towards your goal! With an hour a day, you will be surprised and impressed with how far you've come after just one month. But how to find that hour a day?

Here are some of my favourite blog posts along the lines of this subject. Search for them in google and read them for inspiration and motivation!

Tim Ferriss - one of my favourite blogs - specifically read 4 Hour Work Week Blog: 9 Habits to Stop Now: Once you read this I am pretty sure you will find several ways to get an hour out of your day. For me, it's checking my email MUCH less!
Rock Your Day - Lots of posts on getting up really early to rock your day. Always great content in this blog. Read: Rock Your Day: Catch Yourself Making Excuses and then do Something About it.
Early to Rise - Daily newsletter which I have been reading for over four years now. Early to Rise is FULL of great ideas for making money, being healthy and maximizing your potential in whatever you want to do. Read: Early to Rise: 3 Steps to Success.
Anyway - it's now time for me to focus my way to Real Estate Wealth. Or, is it time to take Bram for a walk? I think Bram is telling me it is walk time... well I will focus after I walk the dog...

The Real Estate Market Crash of 2008 - How Did We Get Here?

2008-08-22T06:54:00.000-07:00

Before the real estate market crash of 2008, there were the prophets. They spoke of a real estate balloon that was bound to burst and take down the real estate market as well as the economy. Even with all of this prophesying, many were taken by surprise when the once lucrative real estate market began to crumble.

So, what caused the collapse? The main culprit was the subprime lending market. When this market crashed, a large amount of companies faced foreclosure. Even the companies that did not foreclose suffered losses that amounted to billions of dollars.

You may have already heard news reports about the subprime market crash. If you are like most, however, you may not know what the crash meant to individual property owners. You may even have questions regarding how we got in this situation to begin with.

Over the past few years, subprime mortgages were the biggest trend in real estate lending. Buyers who were unable to qualify for conventional mortgages could obtain financing via a subprime mortgage. People who obtained these loans often had to pay high interest rates.

Lenders obtained the money to pay for these mortgages from a variety of sources. Many companies secured loans at low interest rates and then loaned that money out to buyers at a higher rate. Some of the money was borrowed from central banks.

While the housing market remained relatively stable, the ill consequences of these loans could not be seen clearly. In fact, the market was experiencing a surge in value that was unprecedented. This surge resulted in an unrealistic expectation of the future real estate market which in turn caused lenders to put even more money into funding mortgages that new homeowners could ill afford.

In 2005 and 2006, the last real boom was occurring in the real estate market. During this time, it was extremely easy to get a loan. Lenders thought that they would be able to make money from buyers even if they did not pay for the mortgage through the high interest rates they were charging and the ever-increasing value of real estate. But when interest rates started to rise, people stopped buying homes. Additionally, homeowners started failing to make payments due to the interest rate spike.

It became harder and harder for lenders to obtain funds to invest into mortgages. Buyers, now unable to qualify for a loan easily, began to stop looking for a home to purchase. Investors became wary, and underwriters started increasing the requirements to qualify for a loan. People who had adjustable rate mortgages sought desperately to decrease their skyrocketing monthly payments. But they could not qualify for a new, fixed loan under the strict guidelines. This only caused the number of foreclosures to rise dramatically resulting in the real estate market crash of 2008

House Swapping Trend in Real Estate

2008-08-22T06:52:00.000-07:00

Now is the best time to acquire homes as the house prices are still practically less. However, the prevailing financial and credit crunch is limiting the cash reserves and liquidity. Thus, many homebuyers would need to first dispose or sell their existing homes so that they can have the money to buy the homes they like. The problem is, it is logically harder to sell homes these days.

Homebuyers are raving about a revolutionary and innovative concept in home selling and buying. To ease the troubles, why not resort to house swapping? With the advent of new and non-traditional media and communications, swapping is becoming a popular trading scheme. It has been in use for trading just any product or item bought and sold across the market. You can easily trade your 3G mobile phone with an iPod. Somewhere in the market, there surely is an individual who wants to trade his or her iPod for a 3G phone. You should meet.

That is also the basic framework in home swapping. Your home can be traded or swapped with the home of another homeowner. To get into the process, you should first determine your likes and preferences. What do you like in a house? Where do you want to own a residential unit? What design and theme do you prefer? If you have set your preferences and requirements, it is time you search around for houses that match your standards.

In the process, you should also assess your home. How aesthetic and appealing is it? What is the prevailing design and where is it located? You should post these data into the market so that prospective seekers can be reached. There are many online and conventional firms operating to facilitate house swapping. These companies are aiming to match you and your dream house and then find someone who wants your home. In the end, you will have to surrender ownership of your home to be able to secure and get ownership of another one, probably your preferred and dream type.

Craigslists are good online materials that can facilitate house swapping. You can also post your ads in the classifieds or in other sources. There are trading firms that seek homeowners like you so better open your eyes and senses when they roam around. Viral marketing can also be effective as well as peer recommendations and feedbacks.

House swapping transactions are basically most recommended for young growing families, empty nesters and vacation home owners who want to swap vacation assets. Homeowners who are relocating are also the most common house swappers. Some owners who just itch to get and own a new house are also much delighted and satisfied with house swapping transactions facilitated in the market.

As for the quality of homes swapped, there is no need to fret. Traders and mediators make it a standard to inspect homes for swapping. You can as well inspect the home you are eyeing very carefully and thoroughly before the swapping transaction is started and closed.

Choosing Commercial Real Estate As an Investment Alternative

2008-08-17T10:20:00.001-07:00

Real estate investing is considered to be a safe investment over time. This is one reason why many do this as a full time profession. One can also invest in real estate and not be involved full time. Most people think of real estate investments as homes or condos or multi-family properties. Commercial real estate is another excellent choice when it comes to investing in real estate.

Commercial real estate investments typically allow the owner to continue their day to day unrelated business while their hired professionals upkeep and maintain their commercial property investment. Although most people think of commercial real estate as office buildings, retail stores, or industrial facilities, there are a lot more property types in the commercial real estate.

Some examples include properties such as health care centers, retail structures and warehouse. One of the most desired and financed commercial property is called residential. More specifically, apartment buildings (real property that consists of more than four residential units) are considered commercial real estate.

Most people consider commercial real estate difficult to enter due to financing and larger down payments than residential property. Although this is true to an extent, there are many commercial financing programs that will offer up to 90% financing and some even up to 97% financing for small commercial properties up to $1 million dollars. Of course, commercial mortgage loans go significantly higher to $500,000 and more.

Commercial real estate investing can be significantly profitable due to increasing rents, inflation and material costs. An investor must be able to analyze an opportunity more thoroughly in commercial real estate versus residential real estate. Some initial analyzes involve the rent rolls, pro-forma statements, and operating income. These numbers are crucial to the lenders to determine the amount of financing you will receive. Once you know the amount you will receive from the lender you can easily determine if the investment is worthwhile. You could take up commercial real estate for either reselling after appreciation or leasing out to residential tenants or retail tenants.

If you research and learn there will be substantial commercial growth in the area (due to tax breaks or gentrification), it may be wise to evaluate the potential for appreciation in commercial real estate and then seek out a good investment. If you find that a multifamily or office property, for example, is available but too expensive for you to buy alone, you may want look at joining or creating a small investor group and acquire it together. In another example, you might find it lucrative to purchase a commercial property that you can change to a warehouse which you can then rent to small businesses. As you have learned here, there are many creative ways to achieve success in commercial real estate investing.

Commercial Mortgage Refinance - 6 Issues That Can Kill Your Deal

2008-08-17T10:19:00.000-07:00

There are several potential issues that can delay or "kill" your commercial mortgage refinance. Some of which will just tack on a few days or weeks to the process while others will completely eliminate the lenders interest in funding your loan. A prime example of this is value and environmental issues.

1. Title Problems. A forgotten lien on title can have a major impact on closing. Perhaps the dollar amount of the lien is substantial and cannot be rolled into the loan amount. Or the borrower may challenge the lien and will have to get it removed/resolved before the lender will fund the transaction.

2. Value. When the borrower and lender negotiate a loan term sheet, one of the most important components is the loan to value ratio. For example, on a refinance virtually all banks will not go beyond 80% loan to value. In other words, if your property is worth $1,000,000, your potential loan cannot exceed $800,000. If after your appraisal has been complete and the value comes out at say $900,000, you have a problem and a dead loan.

Besides the obvious frustration due to the canceled loan, there can be much disagreement with exactly how the value was determined. Appraisal reports are not perfect and have a subjective component to them. Deciding which comparable recent sales to use and how exactly to add/remove value from these comps is up to the discretion of the appraisal company.

3. Sudden Change in Business. Lenders sometimes call this "Adverse Change". Basically what it means is that there has been some type of borrower change from the time of initial loan approval to the closing. With some commercial mortgage refinances taking as long as 90 - 120 days to complete, much can go wrong in that time.

For example, we had a transaction where the borrower had to purchase a small fleet of trucks for his business. The truck loan was personally guaranteed and was reported on his personal credit report. The additional debt dragged his score to the minimum acceptable levels for the funding bank. In addition, the cash flow was tight to begin with and this additional debt also affected the numbers. It created some tense moments for all involved, but was resolved.

4. Environmental Issues. The liability for the lender having to take back a property with environmental issues is huge. No one wants to be stuck with the bill and cumbersome process to clean up a property. Not to mention the possibility of being sued by neighboring owners. It is not unheard of for these costs to exceed the value of the real estate itself.

In regards to a commercial refinances, most environmental issues are not on the scale of Chernobyl. What typically happens is that the results of the Phase One come in with concerns and a recommendation for a Phase 2 report, which typically requires borings and soil samples. The cost on the Phase One is around $1,800 while a Phase 2 is much more expensive. It is not unheard of for that report to be approximately $10,000.

The borrower will have to pay for this report upfront and in cash. He could be reimbursed this cost at closing, but will have to get there - if the results of the Phase 2 shows more issues the borrower could be in a very bad position and may have dead loan and be out the $10,000.

5. A Disaster. It goes without saying that if there is some type of damage to the subject property or perhaps a death to one of the partners, that this will have a substantial delay in the least, to the refinance.

6. Insurance. The subject property has to be insured. To some this may seem painfully obvious but we have seen many refinances get delayed because of this. This problem is especially relevant on refinancing out of private mortgages and or seller financing. Many private lenders don't confirm that proper insurance is in place or simply do not care. Also, on cash out refinances the borrower may have to increase the insured amount as the loan increases which can create issues in and of itself.

Commercial Property Value - How to Determine

2008-08-17T10:17:00.000-07:00

In residential real estate, the listing price is determined by the seller. Comparables "comps" are analyzed for a myriad of variables including price per square foot, bedroom count, bathroom count, number of garages features (pool, central vacuum, etc), location (cul-de-sac, corner, busy street), views & more.

Adjustments are then made to the subject property to render it equal with those comps. For instance if the subject property has one fewer bedrooms and 500 fewer square feet of living space, it's price will be reduced by the value of the extra bedroom and the reduced square footage.

In commercial real estate, pricing is determined by the income the property produces. Although physical features (pool, laundry facility, etc) and location (busy street, etc) are factors, they are considered only to the extent that they enable the property to command higher rent or decrease its operating expenses in order to increase the property's cash flows or Net Operating Income (NOI). Secondarily location is considered to the extent of the potential appreciation of the land. In commercial real estate, it is these cash flows and the amount an investor is willing to pay for these cash flows that will determine the price of the property.

Put simply, if the annual cash flows from a particular property are $100,000 and an investor is willing to pay $2,000,000 for those cash flows, then the property is worth $2,000,000 to that investor. If another investor is only willing to pay $1,000,000 for those cash flows, then the property is worth $1,000,000 to that investor.

Investors will consider numerous properties in a given area to determine the standard of how much is typically paid for particular cash flows in that area. The "going rate" in area can be considered its cap rate. An exact definition and explanation of cap rate will be detailed in a subsequent article. This article will address the concept of cap rate.

In this example, the first investor only required a 5% return on investment or yield and therefore could pay as much as $2,000,000 for $100,000 in annual cash flows to obtain his/her 5% desired return. The second investor required a 10% yield and was therefore only willing to pay $1,000,000 for the same $100,000 of cash flows. Different investors require different yields which affect the price ultimately paid for the property.

This one year yield could also be described as cap rate. In commercial lingo it would be said that the second investor requires a "10 cap" and that the first investor only required a "5 cap." This is an oversimplified explanation to demonstrate the concept. The "one year yield" distinction is made as cap rate only accounts for one year yield, usually the following year from when the investor purchases the property. To determine the combined yields of multiple year returns, different measures are used and will be detailed in a subsequent article.

Commercial investors will determine their risk adjusted requirements for their investments and will base those decisions on opportunity costs. Opportunity costs are the costs associated with not investing into something else. For instance, if an investor could alternatively invest in a stock, bond, T-bill CD, or other instrument and yield 15%, why would he/she buy a property which only yields 5%? In order to attract investors the property owner would have to lower the price (increase the cap rate) to give investors a higher yield.

Notice the inverse relationship here. As prices are lowered, the yield to the investor or cap rate to the investor goes up as related to the cash flows. Conversely, as property prices are increased, the yield to the investor or cap rate on those same cash flows goes down. Cap rate only takes into account the first year of cash flows and does not account for the second year, third year, etc.

Notice I have not even mentioned appreciation. The value of commercial real estate is primarily considered based on its cash flows while investing in residential real estate is for anticipated appreciation.

In residential, there is only one way to make money. The market must go up so the investor can sell for more than the original purchase price. In commercial real estate investors are purchasing cash flows. In our example, if the second investor paid all cash, at a 10,cap which values the property at $1,000,000, that investor would be paid back 100% of the initial investment after 10 years and as of the 11th year, the investor would have $100,000 of annual cash flow from that single property. Because there is no mortgage called debt service in commercial real estate, this would be the cash flow before tax to the investor. In other words, other than income tax, this is the spendable cash to the investor on an annual basis.

Hopefully the property will have appreciated as well and the market will be favorable. But in the very worst case if no appreciation occurred whatsoever, the investor would still enjoy the $100,000 of annual cash flows. The beauty of commercial real estate is in the ability to plan. If you buy a residential property, you must sit and wait for the market to appreciate. The problem is that you never know when this appreciation will occur or how much. You can't plan. And, you're at the mercy of the market. In commercial real estate, as long as rents don't decrease substantially and vacancies don't increase, you know ahead of time how much money you will make regardless of market appreciation.

Now consider this. Let's say that the second investor decided not to pay cash and instead leveraged the property with a 10% down payment or $100,000 to purchase the $1,000,000 property. Let's also consider that the remaining $900,000 was financed at 7% for 25 years which is the typical term length in commercial financing. With a fully amortizing loan the annual payments would be $63,000. In commercial real estate, paying debt owed to the lender is called debt service. In residential, it's called paying the mortgage. From the $100,000 cash flows (NOI) from the property the debt is paid leaving $37,000 of cash flows before tax. For simplicity sake, I will not account for tax effects on income or yields.

In this example, in Year 1, the investor has earned $37,000 for a $100,000 cash outlay or a 37% cash on cash return and will do so for 25 years until the debt is paid off assuming no changes to the income. Subsequently, the investor will enjoy the entire $100,000 of annual cash flows as there will be no debt service. To calculate the combined cash flows from multiple years the investor would look at a measurement called Internal Rate of Return (IRR). For the scope of this article I will not address IRR. But remember, Cap Rate is for a single year's return and cannot account for multiple years with different cash flows each year.

Notice again, I haven't even spoken about appreciation which may or may not occur. But even if no appreciation occurs to our example property, this is still an incredible investment! Now obviously during a 25 year period these cash flows will change as rents will likely be increased and capital improvements will likely be needed (new roof, etc). But again, I'm keeping it simple for example purposes.

To summarize: In residential real estate there is only one way to make money. The strategy is to carry the property and hope that the market goes up and that the property appreciates so that the investor can sell for a higher price than was paid. Positive cash flows are typically non-existent and if present, negligible relative to the anticipated appreciation the residential investment will bring.

In commercial real estate properties are purchased for their positive cash flows AND potential appreciation. It is because of these cash flows that commercial real estate is less risky.

It is for this reason that commercial real estate is more stable and can weather the market storms that residential investments cannot and it is for this reason that the super wealthy own residential to live or vacation but invest in commercial real estate to create their massive wealth.

Who Wants to Understand Real Estate Contracts?

2008-08-13T21:49:00.001-07:00

Mention the word contract and images of expensive lawyers comes to mind. In real estate transactions, this is largely not the case anymore.

Owning a home is the American Dream. While the last few years have been more than a bit rocky for homeowners, the basic idea is still true. It can well be argued that homeownership is the central pillar to the middle class in this country. Given this fact, the legalities surround real estate transactions are surprisingly simple.

In most states, real estate transactions have been reduced to forms. There is a form for making an offer. There is a form for making a counter offer or accepting. Once you have a deal agreed upon, there is a form contract you can use. All of these forms can be purchased at your local office supply store.

Using real estate contract forms makes some people nervous. Rightly so! This is probably one of the biggest financial transactions you'll be entering to in your life. Are you really willing to trust doing it with a pre-printed form? Surprisingly, the use of these forms is generally the right move in most states. The forms are time tested and meet all legal requirements for the state. That being said, it is important to understand some basic legal issues surrounding contracts.

The biggest issue that arises in real estate transactions is the oral promise. A person should honor their handshake or promise, right? Well, maybe in a perfect world. We don't live in such a place. This means you need to get everything in writing. If you do not include all aspects of an agreement in the written contract, they are unenforceable. Oral promises are not enforceable in court, so don't rely on them.

Let's assume you get involved in a real estate transaction and realize you are in over your head. You don't really understand the contract process. What should you do? Go hire a real estate lawyer. Yes, they will cost you some money, but it is money well spend. Spending even a few grand on a lawyer to get advice on what the contract says, should say and so on is far better than committing to hundreds of thousands of dollars of debt under bad terms!

Millions of homes are sold each and every year. Don't let a fear of contracts stop you from getting involved. If you don't understand the process, talk to a lawyer. In most cases, however, forms will do the job for you without any problems.

Probate Real Estate - Is a Legal Background Necessary?

2008-08-13T21:47:00.001-07:00

I know many of you haven't gotten started yet in Probate Real Estate because you are afraid you will run into legal hassles. Well, guess what? When it comes to legal stuff, I'm not the sharpest knife in the drawer either.

However, I'm still extremely successful in Probate Real Estate.

How can that be, you ask? Here's the secret. Buying Probate Real Estate is not a legal process even though the Probate is conducted through the judicial system. Probate Real Estate as I describe in my book, is nothing more than a method of prospecting for folks who might be interested in selling their house at a discount. That's it!

Let me explain it to you this way.

If I thought folks who owned blue houses would give me a discount, I would have figured out a method to contact folks who own blue houses. I have discovered that is not the case. Blue house owners are not a good place to prospect for good deals. Green ones aren't either! What about yellow houses? Nope - wrong again.

How about Probate houses? Now we are talking!

People who have inherited homes ARE more likely to sell these houses at a discount because they don't want them. Why? They have just inherited the house, and most people don't need another house! What they DO need is more long green (cash money), and the sooner the better, thank you very much!

Consequently, I have devised a system to get a hold of them and see if we can put something together. "I'll buy your house quickly if you'll give me a little discount." Simple enough?

So once I find a willing seller, and I'm the willing buyer, we've got a deal. Now it's just like buying the house next door. Even the blue house next door! You and the seller agree on the price, you write a Sales Agreement and the two of you close on the property. Just be sure to use a title company or an attorney, whichever is appropriate in your state, for the closing. They will keep you out of hot water.
Pretty simple, huh?

That's why you don't need any legal knowledge, or legal training. There are no "special" forms or "special" contracts. As a matter of fact, let me give you a little free tip here.

When you go to write your Sales Agreement, if you want to keep in compliance with your local State and County regulations, go down to the For Sale By Owner office in your area and pick up their "forms" packet. It'll cost you around $25. In it you will find a copy of the Sales Agreement that is used in your area. It should also have a short instruction sheet on how to properly fill it out. That's the one to use. Just use their instructions to fill out your Sales Agreements and you'll be good to go. That will also keep the real estate police from knocking at your door!

So now in the two minutes it took you to read this article, you have learned all the legal stuff you need to know about buying Probate Properties.

Ask These 5 Questions When Choosing a RESPA Real Estate Attorney

2008-08-13T21:46:00.000-07:00

"What the heck is RESPA?"

Many attorneys try to handle real estate matters in addition to their regular practice. Very few lawyers are aware of the complexities of the Real Estate Settlement and Procedures Act (RESPA) enforced by the Department of Housing and Urban Development (HUD.)

RESPA statutes are consumer protection laws that impact virtually all single family to four family homes. RESPA compliance issues and the remedies available to borrowers who have been victimized by unscrupulous mortgage lenders, title companies and other real estate settlement providers are a real challenge. Even for full-time real estate attorneys, RESPA is a very complex statute. You must be careful and ask questions of the attorney you choose in order to make sure you get the proper legal protection that the RESPA statute i is designed to accomplish. Consumers and Businesses alike are protected when RESPA is in compliance.

Question #1

"What RESPA experience do you have?"

No doubt about it. Start with the big one. Real estate laws and regulations are complicated enough without adding RESPA to the equation. Have they prepared marketing agreements that comply? Have they attended RESPA specific training courses and seminars? Have they kept abreast of the most recent HUD guidelines and court cases nationally regarding RESPA? How many RESPA cases and clients have they handled? What types of RESPA cases did they handle? Were the issues similar to yours? What were their results? Don't be shy!

Question # 2

"What type of reputation does the attorney have?"

This is a tough one to figure out - so do your homework! Is the attorney primarily a transaction attorney or a litigator skilled in courtroom procedures if necessary? Your attorney must have the communication skills necessary to work with the other attorney as well as you. The other attorney, if more knowledgeable on RESPA can run over you and your lawyer. Remember that many cases are won or lost on the attorney's knowledge and high ethical standards. Check the local Bar association for background. Get references and check them out thoroughly.

Question # 3

"What type of resources does the attorney have?"

No attorney can do everything well. Make sure that your attorney has the resources available to work your case efficiently. Does the attorney have a well established network of experts and fellow attorneys who can network with to add value and expertise to your problem? Some attorneys try to do it all and act as a one man band. Your attorney's ego should not be larger than your case. A good attorney quickly involves others with higher degrees of expertise in areas where it is needed to represent you properly. The experts they use are a reflection of your new attorney.

Question # 4

"What about communications and follow up?"

The hallmark of a good attorney is the degree of communication he has with his clients. If you have to ask "What's going on with my case?" then you have a problem. You don't want to have these types of issues after choosing an attorney. Be blunt and ask how often you will be contacted and updated. How will you be contacted? Will the attorney just send you a form letter or use personal communication and contact? How do you prefer to be contacted? E-mail, phone calls, letters? Ask for it. "Are you too busy to handle me? Are you going to push me to a lower level staffer or junior attorney?" Clear communication and updates can ensure success and results.

Question # 5

"How do they charge?"

Some attorneys charge a flat fee, some charge a contingency based upon results and some charge hourly rates. The type of problem or case generally dictates the type of charge. There is an old saying, "Speed, Efficiency and Price - pick TWO!" The cheapest attorney may not be the best and the most expensive attorney may not be the best either! Make sure that you are not penny wise and dollar foolish. You are choosing an attorney for results. Make sure that your attorney has the financial incentive to work your case efficiently and successfully.

Thinking Forward Regarding Your Commercial Real Estate Loan

2008-08-13T21:44:00.000-07:00

Regardless of what we often have in our business it is always wise to search for what you think will be a big help in your investment. So with that being said let us try to focus on real estate investing. Well there are many types of real estate investing and one of them is Commercial real estate. Well, from that alone we can figure out what types of investment we vaguely want to happen. First there are these known things to consider in its market alone, it is not just a simple thing to know but rather a different one. Securing Miami commercial real estate loan at favorable terms requires some careful work on your part. If you've consulted a good mortgage loan calculator, and figured out what you can swing, there's still the whole application process to take on, first. Applying for small business loans should be done with a careful and well-researched approach. Miami commercial real estate demands high numbers at times and is often noted as another type of situation in the market.

Applying for Miami commercial real estate loans, well it is always figured out that its own market can be treated as a good investment prime at times, so there are several factors in which we should be able to know when we try to apply for a Miami commercial real estate loan. When you want to apply for a Miami real estate loan, you have two choices. You can go to the office of a lender and fill out a questionnaire about your finances. Or, you can visit an Internet-based broker and fill out an online form, which will gain you results far more quickly. The more things you try to embark the market with some strategies that you think would help you a lot, the more times, you'll have a chance on having a good market value. Be aware that in Miami commercial real estate the value of it can also be measured with the knowledge of the term.

Sometimes there are these pointers that we should consider especially in the market which shows nice potential in Miami real estate. You should always know how to cooperate when asking a loan and one of its terms is filling out these application forms doesn't have to be a trial. You should, of course, strive to convey your financial information as accurately as possible. However, an online form is relatively simple to complete. You have to b honest and accurate on the things that you will pit in these forms because often times than nothing you'll be able to at least be updated on those kinds of things. Let us be sure that thinking forward the things that you will put in the forms will reflect to you as well.

You should know that when you apply for Miami commercial real estate loans, expect to be asked the following questions. They will want to know all of the details regarding your business finances. You will be asked about your current mortgage payments, including your balance, terms, and so on. You should also be prepared to answer questions about the purpose of your new loan, the amount, etc. The given value for the market can be either good or bad, so you have to at least know the newest update to it. Because if you are aiming to get value on you Miami commercial real estate loan you should always know better.

Real Estate Loans

2008-08-13T21:41:00.000-07:00

If you are looking to get started in real estate or business, it's quite possible that you will need a loan to get started. If you have bad credit, you might consider giving up before you've even gotten started. Well, I have good news for you. There are some things you can do to get that first loan while you work on improving your own credit rating for future projects.

One of the things you can do is to get a partner with good credit to join you in your real estate or business venture. This is called an "equity kicker" and is very popular in business. By doing this you use your partner's credit as your own for the project you're involved in. What does your partner get in return? In return for supplying the needed credit, you will give your partner a portion of ownership of the business. Depending on the size of your project and how strongly you need your partner's credit rating to get the needed loan, a reasonable percentage to offer will be in the range of 3% to 5%.

Understand that in most deals, you will be the working partner and your "good credit" partner will be the silent partner. He or she will supply the needed credit and nothing more to the deal. As an added incentive you can also offer your partner a small portion of the profit from the real estate or business project. Again, the amount should be in the range of 3% or 5%, depending on the profitability of your project.

While this is a great way to get started, it's important that you work on improving your own credit rating for future projects. Your goal should be to eventually be able to acquire real estate or business loans on your own without having to use a partner's credit.

The way you build your own credit rating is by paying your bills on time, getting a "secured" credit card and using it actively while paying it off fully each month of the year. By owning an asset such as a building or business, you immediately improve your FICO credit score. By paying off your credit cards each month, your score rises. All of these things will work together to get you a higher future credit rating.

For your real estate or business venture, form a company that will put you on the payroll. This will give you a source of income, a W-2 and an employment history. These things will raise your credit rating because you will have a traceable history. This is something that lenders love to cite when approving the loan that you've applied for at their company.

What other things can you do to improve your credit rating? Try joining respected real estate or business organizations. Not only will being a member contribute to your credibility, making you more credit worthy, but it will provide you with more knowledge about your business and help you to make important contacts within the industry. Remember, any dues you pay are provable and tax deductible.

So, don't give up your dreams of getting started in real estate or business just because you currently don't have the best credit. Try using a partner's credit to get started and then follow the steps above to improve your credit rating. Eventually you will be able to get business or real estate loans using your own good credit.

6 REASONS for Investing in Florida Real Estate Investment Property NOW

2008-08-10T03:02:00.001-07:00

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I invite you to take the next few minutes to learn the truth about the real estate market, how it compares to other methods of building assets and why it is such a lucrative form of investing. Many potential investors will say, 'I need to get into the Florida Investment Property market', especially taking into account current stock market fluctuations and the HOT market for investment properties, but simply don't know the facts about Orlando property investing and how to use sale and leaseback method of property management.

When is the last time your financial advisor or stockbroker tried to convince you that moving a portion of your assets into the Florida Investment Property market might be a good idea? Never Right? The 'why' is simple. They don't earn commissions when you buy Florida Investment Property. It is also likely that you have probably never had an 'apples to apples' comparison of stocks versus Florida Investment Property quite like the one you will see here.

Reason 1:

Leverage: Banks will not typically loan money to buy stocks. Banks will however, compete fiercely to loan money to buy Florida Investment Property. Your first question should be, 'why is that'? It has to do with risk management, which we will discuss later. The fact that banks want to loan you money to buy Florida Investment Property creates a situation which we will call LEVERAGE.

Let's assume that you have $10,000 to put into some type of investment. If you choose to buy $10,000 worth of stocks, you will own exactly $10,000 worth of stocks. Pretty straight-forward. However, suppose you choose to invest that $10,000 into Florida Investment Property using a 90% mortgage (which in many cases can go up to 95-100% mortgages in today's market), you will own $100,000 worth of Florida Investment Property. If both of your investments were to appreciate by 10%, your actual gain with your stocks would be $1000 where your actual gain with Florida Investment Property would be $10,000. That equates to an actual 10% return on investment vs. a 100% return on investment. That's what we call leverage.

Leverage: Florida Real Estate vs. Stocks

The traditional argument against Florida Investment Property Investing (mainly from Stock Brokers) has always been 'I can get an average of 10% from stocks with little effort so why would I invest in Orlando Investment Property that only appreciates 6-7% per year'? This point-of-view is not taking leverage into account.

If you take the above statement to be true and compare the REAL numbers, the stock investment gained 10% of the initial $10,000 value (or $1000) and the Orlando Investment Property investment gained 6% of the initial $100,000 value (or $6000). That is still an actual return of 10% versus 60%. It is not hard to see which investment provides a greater immediate return on investment. Additionally. these numbers do not take into account any income from your property during the course of the year, or the substantial tax advantages to owning property, which we will discuss later.

Reason 2:

Value: As we mentioned previously, if you invest $10,000 into purchasing stocks, you own $10,000 worth of stocks (a fairly obvious point). If you invest $10,000 into purchasing Orlando Investment Property using the leverage of a 90% mortgage, you own $100,000 worth of Orlando Investment Property right? Well, only if you paid retail for your property. Any savvy investor will tell you that there are excellent deals to be had in Orlando Investment Property, you just have to find them.

What if you purchased a $100,000 property that happened to be worth $110,000 the day you bought it? Does it happen? The answer is yes, all the time. If you have your eyes open and are willing to 'go through the numbers' to find good deals, they are all around you. You may be asking yourself, why would anybody sell a $110,000 property for $100,000?

Value: Making money when you buy.

The reasons are endless as to why a quick sale is desired, but just to name a few: job relocation, divorce, an estate is being settled or maybe a current appraisal on the property simply wasn't done prior to selling. By 'finding this deal' you have accomplished two things.

You have added $10,000 to your asset column in the form of equity.

You have created additional LEVERAGE for yourself as the value of your property increases (a 6-10% gain on $110,000 is better than a 6-10% gain on $100,000!) Remember, you make money in Orlando Investment Property when you buy, not when you sell.

Reason 3:

Control: Let's take our assumption one step further. When you buy your $10,000 worth of stocks, what can you do to increase its value? If we follow the previous assumption, you have invested $10,000 using a 90% mortgage to purchase a $100,000 property that has an actual value of $110,000 because you 'found a good deal'. So what can you do to further increase the value of your new $110,000 property?

It is amazing what a cleanup, a little landscaping and a paint job can do to increase the value of a property. Only a few hundred dollars well spent can result in huge value gains in Orlando Investment Property. Your $110,000 property with a little effort could easily be worth $115,000, $120,000 or more virtually overnight! Do you have to do any of this work yourself? Absolutely not! If you like to do that sort of thing then have at it, but if not, simply hire it done and accept a little lower net gain.

Reason 4:

Superior Tax Position: The tax code in the United States is geared to reward Investors who make housing and other property available to the population. When you invest in stocks, you are taxed at some of the highest rates in the tax code. When you invest in Orlando Investment Property, you put yourself in one of the best tax positions in the business world. Remember the wealthy that hold substantial portions of their assets in Orlando Investment Property? Tax advantages are one of the main reasons this is true.

Continuing with the above example, let's say that you have completed your 'deal' with the $10,000 invested with a 90% mortgage to purchase the $100,000 property that appraised for $110,000 (because you 'found a good deal'), which you improved to say, $115,000 by spending another $1000 on cleanup etc. Assume that one year passes and the Orlando Investment Property market grew by 6%, your property would now be worth $122,000. So far, so good right? If you are like most people, you may want to spend some of your hard earned money.

Let's do the numbers. You have a mortgage at current rates that started at $90,000 and after a year worth of payments (the majority of which are tax deductible) you still owe approximately $89,000. However, your property is now worth approximately $122,000. If you were to refinance at 90% once again, you would take out a new mortgage of approximately $110,000. This will leave you with approximately $21,000 in cash in your pocket. Now, the BIG question; do you have to pay tax on that money? Absolutely Not! You have not sold the property or realized a 'capital gain'. You have simply borrowed money from yourself. You are able to do what you wish with that money, free from any tax whatsoever. Obviously, a good strategy might be to purchase two more properties just like your first deal!

Also, we have not taken into account the fact that ALL of your interest payments on this property are tax deductible. In addition, you are also able to depreciate the property itself and all of its contents for additional tax advantages if you choose to do so.

Let's be fair and compare the Orlando Investment Property tax position with the stock scenario. Assume that the $10,000 initial stock investment grew by 10% in the first year, creating a gain of $1000 and you wish to access it. If you draw it out, you will pay from 20-28% (or higher) in capital gains tax in order to have access to this money. This reduces your net gain to $800 (actual 8%) or less, depending on your tax situation. Compare that to Orlando Investment Property and you are beginning to get the picture.

Reason 5:

Limit Your Exposure To Risk

Risk Management: Do you remember at the top when we said that banks would compete fiercely to loan you money on Orlando Investment Property? The answer to the 'why' is very simple. Low Risk. Banks incur little if any risk when loaning money on Orlando Investment Property due to the steady, solid growth rate of the property market, as well as the fact that if you default on your payments they will simply sell the property to somebody else. This is in direct contrast to the volatile stock market, which can vary daily with sharp increases and decreases in value. Furthermore, banks realize that a property isn't going anywhere, whereas many investors know all too well about .com and other types of companies that were there yesterday and gone today.

This is all not to say that Orlando Investment Property markets don't go down from time to time, however the dips are much less dramatic than that which can take place in the stock market, proven out by the banks' willingness to loan money on property.

Reason 6:

Protecting your peace of mind.

Finally, Now that we understand the value of leverage and risk management we realize that a 6% Orlando Investment Property gain 'beats the pants off' a 10% stock gain in actual return on investment by a wide margin (approximately 50%, not taking into account several factors that can increase this number such as tax advantages, income on property etc.) Owning good, solid Orlando Investment Property allows you to sleep at night, or go on an extended vacation without worrying about your asset column. This is directly opposed to holding a substantial percentage of your assets in stocks.

Rental Real Estate

2008-08-10T03:01:00.000-07:00

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Understanding Your Rental Property

Adding real estate to your portfolio can be a smart thing to do. Many do this by converting their first home into a rental when they can afford to acquire another principal residence. As I have discussed before, every portfolio should have 20% invested in the alpha rim (see “Do What the Hell I Tell You-Guide to Portfolio Building”). The alpha rim is the part of a portfolio that is not invested in stock market products. Therefore, it is not subject to market fluctuations and provides some risk protection to a given portfolio. When adding any new investment to our portfolio, we should take time to learn the basics so that we can make informed decisions over time. Adding real estate to a portfolio definitely requires an understanding of the fundamentals.

Let’s begin by taking our first town home. It was purchased right after we were married with the intent that we would one day live in a larger home. Because we were so good at saving, we did not need to sell the first home to get into the new place. We have made contributions to retirement plans and have savings on the outside of the retirement plans. The decision has been made to keep this town house and convert it to a rental property in order to begin investing in the alpha rim. It becomes necessary at this point to understand how a rental property works from its beginning, during its operation, and when a decision is made at the ending its existence in the portfolio.

Putting the Property in Service

If the property is being converted from personal use, as it is in this situation, we must take the lower of cost or market value in placing this property into service as a rental. If we purchased the home originally for $200,000 and its fair market value is $300,000 when we are ready to make the conversion, we will use the $200,000 original cost as our basis. If the fair market value was $150,000 at the conversion date, then this would become the basis for the rental property. Placing a property in service in this case means establishing how much will be available for depreciation and how much will be allocated to land. Let’s assume that $200,000 is our basis. We will need to allocate this basis to determine what can be depreciated and what must be land (not depreciated). I like to use the property bill assessment as it normally breaks down the property into what is building and what is land. After reviewing the property assessment, it is determined that 80% of the property’s value is building with the remaining 20% representing land value. This means that we will depreciate $160,000 over a 27.5 year life, or $5,818 per year. If we were to purchase this rental property as opposed to converting, our basis would be calculated based on cost plus settlement charges. Remember, each year that we take depreciation, we are reducing our tax basis in the property. This is important to know as we consider disposition of the property.

Operations of the Rental Property

As one might imagine, everything that relates to the property becomes a tax deduction. Mortgage interest, real estate taxes, repairs and maintenance, insurance, property management fees, and the like become ordinary and necessary expenses for the rental property. It should be noted here that the ideal situation is to have the rents charged to tenants equal not only debt service on the mortgage, but some built-in factor for repairs and upkeep. This of course, will be subject to fair market value rents in the neighborhood, but the goal should be to cover these expenses. In the event that the property operates at a loss, this loss will be able to offset other income on a tax return to the extent that adjusted gross income is $100,000 or less and the loss itself is not greater than $25,000. If adjusted gross income is $150,000 or more, the $25,000 loss limitation is reduced to zero which would make suspended any losses realized. Suspended losses are then carried forward to offset passive income in future years or to be recognized upon termination of the property. When starting a rental property, it is important to know the rules of the game as one might not get the tax benefits expected. If your adjusted gross income exceeds $150,000, you will not currently get any tax benefit from losses unless you have passive income from other sources. If you have a series of suspended loss carry-overs, you might consider adding a passive income generator to your portfolio (see my article, “The Most Complete Real Estate Article on the Internet”).

Disposition of the Rental Property

Now we are considering the disposition of our rental property. At the time, it is believed that we can get $400,000 for our investment. Do we have exposure to income taxes due to the gain of this property? Of course we do, don’t be silly. Let’s first calculate what our gain will be. We know our selling price, so we need to calculate our adjusted in the property. If the property has been depreciated for 10 years, our accumulated depreciation will be $58,180 ($5,818x10 years). This would bring a depreciable basis of $160,000 down to $101,820. We will add $40,000 to this for un-depreciated land basis bringing the adjusted basis up to $141,820. The gain exposure for this property is then calculated to be $258,180. This gain is section 1231 gain which will likely mean that it is long-term capital gain. However, this gain will have two tiers of tax. Because of the depreciation taken in prior years, the accumulated depreciation of $58,180 will have a 25% tax rate application. The balance of the gain, $200,000, will be taxed at the long-term capital gains rate of $15%. There is the potential to do a 1031 (like-kind) exchange on this property which would allow for the postponement of the gain providing that a property of greater or equal value is acquired. There is also the potential for netting the capital gain of this transaction with capital losses that might be in the portfolio. Does it make sense to sell outright or do a 1031 exchange? It depends on the facts and circumstances of this particular portfolio. If the alpha rim is well above the 20% mark, and with long-term capital gains at just 15%, it might make sense to just recognize the gain and pay the taxes (see my article on netting capital gains and losses). If we need to buy another property to maintain 20% in the alpha rim, the 1031 exchange could be the right solution. See what I mean when I say one must understand the fundamentals of owning real estate? My way is better.

1031 Deferred Exchange - Real Estate Investment Property Qualifications And Rules

2008-08-10T03:00:00.000-07:00

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A 1031 exchange is a strategy used to defer or eliminate the payment of capital gains taxes arising from selling a real estate property used for investment or for "productive use" in a business or trade. It is named as such because "1031" is the IRS code section 1031. "Exchange" refers to the core of the strategy in which one investment property is sold (relinquished) and a new investment property is purchased (acquired) and intended to replace the sold property.

*Review of Capital Gains*

A capital gain is known as the profit from selling an investment. It is the difference between the cost basis of purchasing the investment and the amount for which it was sold.

Capital Gain Tax Deferral Through a 1031 Exchange

A 1031 Exchange would enable the investor to avoid paying tax on the capital gains realized from the sale of an investment or business property. A third party intermediary, an entity not related to either party, would retain the capital gains (profit) from the sale until a replacement investment property is found and purchased by the investor.

The capital gains realized from the sale of the investment property will be applied to the purchase of the newly acquired property, thus avoiding the payment of capital gains taxes. Very specific requirements must be met and only certain properties qualify for a 1031 exchange.

Determining If Your Property Qualifies For a 1031 Exchange

The detailed process of a 1031 is somewhat complex and it's always advised to seek out a tax professionals' guidance throughout this process. Any errors will disqualify the investment property exchange and the investor would be required to pay the capital gains tax.

Summary of 1031 Property Qualifications

Certain qualifications of the existing property and the replacement property in question must be met. These qualifications include:

1. Type of Property

2. Intended Use of Property

3. Like-Kind Property

4. Specific Requirements

Type of Property

Two types of Real Estate Properties qualify: Business Properties and Investment Properties that are owned for the purpose generating income. This may be revenue from a business or income generated from the investment itself (ex. Rental income).

*Key Point: Personal Property Does not Qualify

For example, rental properties or a Plumbing business would generally qualify for a 1031 exchange.

This is a very specific requirement and excludes any personal property. While most homeowners consider their home an investment, its primary purpose is a place of residence, not to generate investment income.

Summary of Properties Excluded

1. Inventory

2. Dealer Inventory (Flipping is excluded)

3. Personal Property held for sale

4. stocks, bonds and notes

5. Interests in Partnerships

6. Vacation homes

7. Certificates of Trust

Intended Purpose

The intention of current property and the replacement property must be for a business or investment purposes.

* This may sound obvious, but there are some situations where intent will come into play. For instance, an investor wants to buy a rental home in Florida as part of a 1031 exchange. The investor currently owns apartment rentals and is looking to sell and replace them with the vacation home.

Intended purpose will determine if this situation qualifies for a 1031. For instance, the vacation home will qualify if the intent is to collect monthly rent from tenants. However, if the investor intends to reside in the vacation home, even if only in the winter, it does not qualify for a 1031 exchange.

*Key Point: Personal Property AND Vacation Homes are Excluded from a 1031 Exchange.

Like-Kind

The properties to be exchanged must be of "Like-Kind". According to the IRS, the investment properties must be of similar character and nature. However, the grade and quality of the new property does not have to be similar.

For instance, an investor may have own a landscaping business and wants to sell it in exchange for a residential home that he or she wants to fix up and sell for a profit. Would this qualify for a 1031 exchange? The answer is No.

Purchasing homes with the intent of flipping' them does not qualify for 1031 exchanges because they are considered "Inventory". Inventory is not eligible for a 1031 exchange.

However, a shopping center can be exchanged for an apartment complex, or raw land intended for business can be exchanged for a department store.

Summary of Specific Requirements and Safe Harbor Provisions

1. Both Properties are held for investment or use in a trade or business.

2. A Replacement property must be identified within 45 days of the sale of the relinquished property.

3. Replacement property must be purchased within 180 days of the sale of the relinquished property.

4. A qualified intermediary must be designated to hold the proceeds of from the sale of the relinquished property until the closing date of the replacement property.

5. To remain tax free, capital gains received from the original sale must be utilized for the purchase of the replacement property.

In closing, the 1031 Exchange is an excellent strategy to protect business profits, yet it's a complicated endeavor that requires the assistance of professional guidance and planning.

Real Estate Trends Report 2008

2008-08-10T02:58:00.000-07:00

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A cold chill has blown on the real estate market and sales are down across the country. When the market was hot, every Tom, Dick and Harry wanted to be in the kitchen and sell real estate. Why? Because it did not take any skill or premier quality customer service. Now that the housing market has been on a steady decline for just over two years we have an opportunity to separate the good from the bad and the ugly.

There are actually agents that expanded their market share, added more clients to their portfolio or received higher customer service acknowledgment during the last year. Those are the agents that understand that in a down market true real estate professionals actually can do better.

According to the Swanepoel Trends Report, published by RealSure, there are five strategies that will not only keep the real estate agents afloat until the next upswing but could actually place them in a better position for rapid growth when the market turns. In summary they are:

1. Maximizing Technology and the Internet

Google should be a part of every real estate professionals online lead strategy as placing high on organic search results has become very important to any serious agent. At the same time integrating your key activities such as marketing, MLS, customer management, etc. need to be integrated into one easily accessible web-based system. Agents should use this year to make sure that when the next boom arrives they will be able to process the entire home buying and selling transaction digitally.

The Report discusses dozens of new innovative Web 2.0 initiatives, encouraging agents to explore these services and see which may be added to strengthen their online portfolio.

2. Building Teams Correctly

The creation of smaller more effective business units or teams within larger companies has been around for awhile, but during the last decade the concept has gained momentum. RE/MAX now estimates that 27% of their affiliates are working on a team. According to the Report there are basically two different kinds of teams. The first is where two or more producing agents combine their practices under one banner to provide greater coverage for themselves and their clients and the second where a lead agent starts building a business inside the brokerage operation. The lead agent then hires administrative staff to increase his or her time in more productive and income generating sales activities.

No matter what the size or how a team is structured, the key to building a successful team requires following the correct steps, getting the right chemistry between all team members and executing on a deliberate business plan.

3. Solidifying Your Business Plan

In todays competitive and complex marketplace, an entrepreneurs success is far from guaranteed. Moving into 2008 or 2009 without a well thought out and implemented business plan is a disaster waiting to happen. Yet so many agents fly by the seat of their pants.

A good business plan should include:

An assessment of your current situation.
A definition of your business focus and strategic intent.
A clear vision of what results you want to achieve by objectives.
A list of action steps that you will utilize to achieve your goals.
An understanding of why you need regular analysis and occasional revisions of your game plan.

4. Using Virtual Assistants

The ways in which Virtual Assistants (VAs) can help real estate agents become more productive are limited only by ones imagination. And there are few, if any, support functions that cannot be handled by a VA - including functions such as:

Transaction Coordination
Listing Marketing Coordination
Staying in Touch
Online Lead Management
Operational Management
Screen Email and Phone Messages
Ad Writing
Website Maintenance

5. Diversifying Your Business

Diversification is the order of the day. For our industry there are two types of diversification - geographic and product or service. In these slow times it may be wise to view the needs of your customer base to see if there are other profitable products that may be a good fit to offer past clients. It is also a perfect time for agents to expand their skills and knowledge by getting educated on other transactional aspects such as mortgage, escrow, home owners insurance, home warranty, remodeling, repairing, painting, landscaping, etc. The advantage of bringing some of these services in-house is the ability to eliminate the expense of redundant overhead and to derive additional income from the same client.

Full Service Real Estate

2008-08-10T02:55:00.000-07:00

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You always hear companies and agents say they are "Full Service" Realtors. Unfortunately, there are too many agencies calling themselves "Full Service" and not living up to their clients' expectations. So, what should you expect from your "Full Service" agent? In addition to your personal expectations, here are some aspects you should require before choosing who you do business with:

Education-
Before entrusting someone to fulfill your real estate needs, you want to ensure you are selecting an agent who is dedicated to continually educating themselves about their industry and the current market. Unfortunately, obtaining a real estate license isn't the most difficult of things to do. There are too many agents in this industry who skate by with the minimal continuing education courses required to keep their license. A "Full Service" agent should continuously be educating themselves and staying on top of current market trends. Ask your agent how often they update themselves on new market data. If their answer is anything other than daily (or at least weekly), move onto another agent.

Communication-
One of the biggest complaints from both buyers and sellers is the lack of communication from their agents on even a basic level. You should be receiving some form of contact from your agent every week. Even if it's a simple email to tell you that there hasn't been any new activity on your property. What's worse is when agents fail to return clients phone calls and emails in a timely fashion. If your "Full Service" agent doesn't determine your preferred method of contact and doesn't have a steady system for keeping in contact with you, you should question if they are providing you with "Full Service."

Company Image-
There are several fly by night companies out there that try and pass as "Full Service" agencies. The company you choose should have guidelines in place that require a level of professionalism and dedication from all their agents. There are many companies (including well known chains) that will take on any agent who comes through the door. Find out how extensive of an interview process the companies you're deciding on have, and do they retain the cream of the crop in your market.

Long term-
Study shows that 50% of all licensees are gone within a year, and that 80% leave the industry by their second year. Of the 20% who remain, many still lack the work ethic and devotion it takes to survive in a down market. As a result, many agents will put their license on ice until the market rebounds. Within the last two month we've seen a large increase of agents coming back into the market that originally changed their license to inactive over the last couple of years. So even if the agent you're speaking with has several year of experience, find out what amount of it was spent with an inactive license. You'll find only a handful of agents have what it takes to be to deliver results to their clients no matter what the market conditions are.

Systematic-
Every agent you speak to will tell you they can do the job you're looking for. But do they have a system in place to actually deliver? You want to make sure your agent has a system in place to ensure that your needs will, (not might) be met. Studies show that less than 20% of agents have even developed a process for their original interview, let alone for an entire transaction. During your initial interview process, a "Full Service" agent should be able to provide a step by step agenda which will prove to you without a doubt that they are able to fulfill your needs.

Ask These 5 Questions When Choosing a RESPA Real Estate Attorney

2008-08-09T11:05:00.000-07:00

"What the heck is RESPA?"

Question #1

"What RESPA experience do you have?"

Question # 2

"What type of reputation does the attorney have?"

Question # 3

"What type of resources does the attorney have?"

Question # 4

"What about communications and follow up?"

Question # 5

"How do they charge?"

How To Protect Your Rights and Interests in Real Estate Business

2008-08-02T09:56:00.002-07:00

According to a recent survey, real estate is still among the top five lucrative businesses in the United States. However, many entrepreneurs fear to tread this territory as it involves a lot of risks. Real estate owners or landlords of private buildings are challenged by many problems that are often unforeseen but usually incidental in nature.

For instance, if you are a landlord, your tenant could default on the rent agreement entered into by both of you. You will certainly take legal steps to collect the rent owed by you. However, given the fact the laws relating to the real estate and private property vary from one state to another in the United States, it can be highly tricky to handle a dispute related to a defaulting tenant. Moreover, if the defaulting tenant files for bankruptcy to safeguard his financial interest, then the entire process of property litigation can get expensive, lengthy, and frustrating for you.

Given this complex scenario, you should always consider taking the help of some experienced and skilled real estate attorneys who can protect your rights in the property matters and safeguard your financial interests by assisting you in drafting an efficient lease agreement. Besides, in real estate business you can also face problems in terms of your party breaching the contract entered into by both you. In such a case, real estate lawyers can help you in reviewing your lease agreement or house contract to put up a strong case in your favor and represent you before the court of law in a manner that bring favorable outcome to you.

When it is a case of collecting money from your debtors who might file for bankruptcy to evade payment, experienced bankruptcy lawyers can assist you in dealing with the complex procedures of collecting money from your debtors in the shortest and simplest possible manner so that you retain your peace of mind to stay focused on your business.

Who Wants to Understand Real Estate Contracts?

2008-08-02T09:56:00.001-07:00

Mention the word contract and images of expensive lawyers comes to mind. In real estate transactions, this is largely not the case anymore.

Owning a home is the American Dream. While the last few years have been more than a bit rocky for homeowners, the basic idea is still true. It can well be argued that homeownership is the central pillar to the middle class in this country. Given this fact, the legalities surround real estate transactions are surprisingly simple.

In most states, real estate transactions have been reduced to forms. There is a form for making an offer. There is a form for making a counter offer or accepting. Once you have a deal agreed upon, there is a form contract you can use. All of these forms can be purchased at your local office supply store.

Using real estate contract forms makes some people nervous. Rightly so! This is probably one of the biggest financial transactions you'll be entering to in your life. Are you really willing to trust doing it with a pre-printed form? Surprisingly, the use of these forms is generally the right move in most states. The forms are time tested and meet all legal requirements for the state. That being said, it is important to understand some basic legal issues surrounding contracts.

The biggest issue that arises in real estate transactions is the oral promise. A person should honor their handshake or promise, right? Well, maybe in a perfect world. We don't live in such a place. This means you need to get everything in writing. If you do not include all aspects of an agreement in the written contract, they are unenforceable. Oral promises are not enforceable in court, so don't rely on them.

Let's assume you get involved in a real estate transaction and realize you are in over your head. You don't really understand the contract process. What should you do? Go hire a real estate lawyer. Yes, they will cost you some money, but it is money well spend. Spending even a few grand on a lawyer to get advice on what the contract says, should say and so on is far better than committing to hundreds of thousands of dollars of debt under bad terms!

Millions of homes are sold each and every year. Don't let a fear of contracts stop you from getting involved. If you don't understand the process, talk to a lawyer. In most cases, however, forms will do the job for you without any problems.

Ways to Cancel a Real Estate Contract

2008-08-02T09:55:00.001-07:00

In Maryland real estate investment should be done after framing a legal contract, which is signed by the seller and the buyer. The buyer pays fixed amount of money as a security deposit for the real estate property, for which the contract has been framed. The contract includes various important terms like description of the parties, explanation of legal terms and conditions, offer amount that has been decided, and finally the closing date of the Maryland real estate deal. It is advisable to thoroughly go through the terms and conditions listed in the contract before signing it.

Sometimes it becomes necessary to terminate or cancel the real estate contract. Generally a contract does contain a termination clause, which states under what type of situations the buyer can cancel the contract. To safeguard the interest of buyer and seller, the buyer should cancel the contract before the closing date. Otherwise it might create problems for the seller and lead to litigation on the buyer. Following are some common ways to cancel a real estate contract:

* The buyer might not be able to arrange for enough funds to buy a real estate property in Maryland under the prescribed time limit, mentioned in the contract. Under such situations, the buyer should give a written document mentioning that the buyer has made sincere efforts to make money arrangements, but received a written rejection letter from the bank or credit association where the loan application was given.

* If faults or defects are found in title review, the buyer has the right to cancel the contract. He/she should give a written consent to the seller about the title defects that are noticed. In case these defects cannot be dealt with, cancel the real estate contract.

* Usually inspection related issues lead to cancellation of a real estate contract in Maryland. Problems like excess of repair required by the property exceeding a particular amount of money, unnecessary encroachments on the property and so on could be the reasons for contract termination.

The buyer should keep in mind the time frame that has been listed in the real estate contract. If the contract is canceled after that time, it could lead to non-cancellation of the Maryland real estate deal. Hiring a good professional realtor can help the buyer to locate a real estate property that meets his expectations, and has a genuine seller. And the buyer can use their right of termination in case of any serious property related issues.

Getting Comfortable With Real Estate Contracts

2008-08-02T09:54:00.000-07:00

Selling or buying a home is one of the biggest transactions you will ever enter into during your life. As with most transactions of this sort, a contract is required. Ah, but what if you are not a lawyer?

Let's start off with the basics. A contract is simply an agreement between two parties in which each promises to do something. At its most basic, a real estate sales contract is an agreement wherein the seller promises to exchange title to the property in exchange for the buyer's promise to hand over a boat load of money. If one party fails to live up to its promise, then it is in "breach" of the contract and a court action can be filed to enforce the promise.

If you have every purchased a home, you know a real estate agreement is much more complex than the simple example in the previous paragraph. You might not know why exactly, but the sheer thickness of the agreement tells you as much. So, what is all that extra stuff?

Boilerplate. This is the legal term for the five billion clauses in your average real estate agreement. "Boilerplate" is simply legal jargon referring to language included in the agreement to cover various potential events and issues. Let's look at a simple one.

Every real estate agreement has a jurisdiction clause that is part of the boilerplate language. It is often found in the last few paragraphs. What does it do? It sets forth the county and court where any disputes that arise between you and the other party will be decided. As simple as this sounds, it can often be 10 lines long. And this is only one clause!

Obviously, it is impossible to go over every clause in a real estate contract. If you are entering into a real estate transaction and are nervous about the agreement, don't sign it. Instead, spend a few hundred bucks to have a real estate attorney review it to make sure you aren't getting taken to the woodshed. It will be money well spent, particularly given the large amount of money involved in the transaction.

Probate Real Estate - Is a Legal Background Necessary?

2008-08-02T09:51:00.000-07:00

7 Reasons to Use a Real Estate Agent

2008-07-24T09:42:00.000-07:00

Some people choose to use a real estate agent and some people choose to go it alone. One thing I have noticed over the years is that a number of seasoned investors looking in a new city will seek out a good agent while novice investors will frequently go it alone. I have even had a number of successful real estate agents seek out my help when they are moving to our city. Why do some of these seasoned investors choose to work with an agent? Below is a list of 7 benefits of using an agent.

1. Understand potential restrictions of the property. I recently heard a story from a friend at the city development office in Austin Texas. A couple had saved up for their retirement. They wanted to retire and live out in the hill country. They went to the foreclosure auctions. At the auction they purchased a lot for 500,000. It had great views and they were going to build their dream house on it. They had researched the lot before the auction and found it was zoned SFR which means a single family residence can be built on it. After purchasing the lot they started plans to build their retirement house. At this time they discovered the lot was in the 25 year floodplain. My friend at the city development office explained that the lot could not be built on and was basically worthless.

2. Know about new developments that might affect a properties value. A good realtor will know of proposed new developments that might affect different properties in which a buyer is interested. Whether these developments are positive or negative can be valuable information when weighing different housing options.

3. Find potential problems with a property. It is always a good idea to have a home inspector look at a potential house. However, a Realtor is a good first line of defense to see if a house has inherent problems. A Realtor that can know about common problems, such as foundation or electrical, that affect a particular neighborhood.

4. Understand contracts specifics. Whenever you buy or sell a house you are entering into a large personal transaction. It helps to have someone on your side that deals with these types of transactions on a daily basis. A Realtor can help you understand contracts and can explain what is typical for your area. The most common pitfall into which I see unrepresented buyers fall is to become involved in an atypical contract that is not to their benefit. For instance a seller will sign an offer that has an option period that is 4 times longer than what is typical. A buyer might put in offers on multiple properties with long option periods. The buyer will wait and see if the market appreciates. If the market has appreciated the buyer buys the house at now and undervalued price. If the market has gone down the buyer walks away.

5. Misperception of a benefit of going it alone. Buyers frequently think that by not using a buyers agent they will get a better deal from the seller. In most situation the listing agent asks for 6 percent from the seller. If a buyer comes with an agent the listing agent splits the 6 percent with the buyers agent. If an unrepresented buyer comes the listing agent keeps the whole 6 percent. On the selling side, For Sale By Owners (FSBO) often think they are saving alot of money by avoiding a listing agent. Nationally, FSBO homes sell for 14 percent less than agent listed homes in the same neighborhoods. In addition alot of FSBO's still end up having a buyers agents involved. There is also money spent on advertising. Since an agent has experience marketing homes the agent often can spend money more effectively on advertising. Agents often know which advertising sources produce the most potential buyers.

6. Save time when looking for listings. Looking for listings without an agent can take up large chunks of time. When looking with an agent you can see several homes in a few hours. When going it alone you have to call the listing agent for each house and wait at the house for the agent to arrive and open up the house. In addition agents often know houses which are not listed or may have already identified potential problems with a particular house of interest.

7. Insure Security. When a home is listed with a broker, agents coming to the house have to usually log in. This allows the listing agent to keep a record of every party coming into the house. Since their business is on the line, agents are more likely to protect the house from damage or theft. For a variety of reasons, it is generally not a good idea to have random people you do not know come into your house. Often sellers simply have a phone number, but that phone could be their house, a friend's house, a pay phone, or even a stolen phone.

Searching for a home can be stressful and difficult but it can also be fun. Whether you choose to look for a home on your own or with a Realtor its a good idea to be a extremely careful when you seek out your dream home.

Top 7 International Real Estate Markets

2008-07-24T09:40:00.000-07:00

Based on several factors that include lifestyle, retirement, opportunities for fun and investment, International Living magazine has chosen the world's seven hot spots for 2007. Still virtually unnoticed by the world's tourists, these seven regions are the best international real estate markets in 2007. They are:

1. Montenegro: This spectacular European country on the Adriatic Sea that many have almost forgotten has topped the list of best international real estate markets. The aquamarine sea, enthralling mountain backdrop, captivating summer villas and quaint fishing villages are just a few features of this jaw-droppingly beautiful country. An ideal tourist spot, this country has been adjudged the 'fastest growing travel and tourism economy' by the World Travel and Tourism Council.

2. Cartagena, Colombia: This is an ancient walled city embellished by magnificent Spanish colonial architecture and flanked by white-sand beaches. The city offers a warm weather, affordable lifestyle, and world-class diving and snorkeling for tourists and locals alike.

3. Malaysia: Southeast Asia's top retirement haven, country is a very affordable destination. Malaysia offers a western lifestyle and a host of attractions including modern infrastructure, cheap accommodation and innumerable cultural charms. Its beautiful white beaches and clear blue waters offer sailing, diving, snorkeling, etc.

4. Calabria, Italy: A sunniest corner of Europe, Calabria is a beautiful peninsula that is enveloped by clear silver-blue sea on three sides. Life happens in a very leisurely manner in this place that possesses all the charms of a medieval village. A promising real estate market, the region is well connected by the low-cost Euro-carrier RyanAir.

5. Ciudad Vieja, Uruguay: This is another of the world's inexpensive cities that remains undiscovered yet. The city has seen a booming real estate market since 1995 and the upward trend is sure to continue through 2007 too. Also ranked as one of the top 10 cheapest cities in the world last year, Ciudad Vieja remains one of the best places to invest this year.

6. Honduras Cloud Forest: With acres of mountain forests of breathtaking beauty, this mountain paradise is just minutes from a charming beachside town and an international airport. One can access this town by air in less than 2 hours from many places in the U.S. With the area poised for a real estate boom in a few years down the line, now is the time to buy.

7. Mexico's Flamingo Coast: An enticing stretch of coastline with dozens of quaint little beach towns, side-by-side, the Flamingo Coast offers great beachside living and a laid back lifestyle. Its warm weather, white sandy beaches, emerald-green waters and cheap rentals are some of the attractions the region offers.

Myths About Real Estate Agents

2008-07-24T09:36:00.001-07:00

There are some myths about real estate agents, many of which are not so flattering. But when it comes down to it, real estate agents are not too out there, and there is a logical explanation to each misconception. Let's straighten out a couple myths and facts.

Myth #1: They have big hair.

Fact: Though occasionally real estate agents do have big hair, most are regular people who get up in the morning just like you do, and go to work just like you do. Many real estate agents, in fact, are going bald due to stress related hair loss. Same with the fancy dagger-shaped manicures; in actuality, many real estate agents have bitten their nails down to nubs.

Myth #2: Real Estate Agents drive luxury cars while talking on their cell phones.

Fact: Itâ??s true that real estate agents are often trying to do too many things at once, but they like to be careful about it. And though real estate agents would like to make a good impression on you, more often than not they drive Hondas and Toyotas and hope that their hard work will sell you, not their Lexus.

Myth #3: Real Estate Agents know your area.

Fact: Just like normal people, real estate agents canâ??t know everything. Though they do spend a lot of time driving around town, they canâ??t be in all places at once, and they themselves probably have preferences for one neighborhood versus another. Make it clear to your realtor what kind of area you want to live in, and they can help you look within that section of town.

Myth #4: Real Estate Agents live outside of time.

Fact: Real estate agents have lives too, and those lives happen to take place in the same physical realm as yours does. While it might seem like they spend a strangely disproportionate chunk of time speaking with you, they are actually trying to be as time-conscious as possible, so that you can move more quickly into your home and they can move more quickly to helping their next client.

Myth #5: Real Estate Agents just want your money.

Fact: What real estate agents actually want is an easy life. They want to help you find a home you love, and they want to make their (often small) bit of commission off of it (and thatâ??s off the sale, not out of your pocket). They do not want your soul or your firstborn, just some patience, consideration, and a positive home-buying experience for all.

Top 7 Countries That Invest In U.S. Real Estate

2008-07-24T09:35:00.000-07:00

Despite a recent slowdown, the U.S. real estate market continues to be a popular investment destination for foreign investors. Attracted by a desirable return on investment, many foreign nations continue to invest heavily in the U.S. residential and commercial real estate markets. In fact, in 2005, foreign investment in U.S. real estate reached 1.83 trillion.

To evaluate the impact of foreign investment on the U.S. real estate market, the National Association of Realtors (NAR) produced a 2006 report entitled 'Foreign Investment in U.S. Real Estate: Current Trends and Historical Perspective.' The report provides insights into the trends in foreign real estate investment, its impact on the U.S. economy, and the major countries that participate in U.S. real estate investment. Below are some highlights from the NAR report.

According to the U.S. Department of Commerce, the top seven countries that had significant holdings in U.S. real estate as of 2005 were:

Germany - 13 %
Latin America - 13 %
Australia - 11 %
Japan -10 %
United Kingdom - 10 %
Canada - 6 %
Netherlands - 6 %

The U.S. economy is wide open to foreign investors. Both investors and Americans significantly benefit from all this foreign investment. The NAR study estimates that without foreign investments in the securities market, the long-term lending rates would be four percentage points higher than the current rate, which would adversely impact the U.S. real estate market.

Foreign direct investment into the U.S. not only creates more jobs but also contributes to the demand for U.S. real estate. In fact, foreign investment may be responsible for creating two million U.S. jobs by the end of 2006, which further bolsters the demand for U.S. real estate.

Permanent and temporary immigration of foreign-born workers into the U.S. further bolsters the demand for real estate. According to the Joint Center for Housing Studies at Harvard University, 1.2 million net immigrants are expected to arrive in the United States annually. This immigration pattern is expected to offset the decrease in housing demand by post baby-boomer generations.

In summary, the impact of foreign investment and immigration into the U.S. will continue to play a major role in the U.S. real estate market.

Protect Your Deposit When Buying Real Estate

2008-07-24T09:34:00.000-07:00

When you start the process of buying a home or any type of real estate, you'll no doubt hear the term "earnest money deposit" (EMD). So what exactly is an EMD?

An EMD becomes relevant when you are ready to make an offer on a property. In most states, your Real Estate Agent prepares the offer on your behalf. The offer usually takes the form of a written contract that is submitted to the seller by way of their agent.

In addition to the offer document, sellers typically expect an EMD. An EMD is a monetary deposit submitted via check to demonstrate to the seller that you are a serious buyer. In some regions of the country, only a photocopy of the check is submitted with the offer, and the original check is delivered to the appropriate entity if the offer is accepted. Ask your Real Estate Agent to clarify how deposits are handled in your region of the country.

The check is usually made out to an independent third- party such as a Title Company, Escrow Company, Real Estate Attorney or your Real Estate Broker. Ask your Real Estate Agent to clarify who will hold the EMD.

The amount of the EMD sellers expect varies by region. The EMD amount is based on the customs and practices for a region, but is generally from 1% to 2% of the purchase price. In a competitive market place where demand exceeds the supply of homes, some buyers may offer a higher EMD than expected to impress the seller of their intent. In determining the amount of your EMD, consult your Real Estate Agent and balance the need to demonstrate your serious intent, against the good business practice of minimizing the deposit amount.

The amount of the EMD is usually applied to reduce the purchase price of the property or to cover closing costs, as you dictate. For example, if you are purchasing a $300,000 property and you give an EMD of $3000, then the remaining balance owned at closing is $297,000 (plus closing costs). Alternatively, you may direct that the EMD be applied toward the closing costs.

Once a valid contract for purchase is created, an independent third-party usually holds the EMD until the purchase is either completed or cancelled. At this point, the money belongs jointly to both the seller and the buyer.

In cases where you make an offer that is accepted but later decide to cancel the offer, the terms specified in the contract (or state law) will dictate if, and under what circumstances, the EMD is returned to you. Be aware that you could loose your deposit if you do not not comply with the terms of your contract. Your Real Estate Agent can provide you information about how EMDs are dealt with if a contract is cancelled.

Since state law varies by region and practices can differ even within the same state, be sure to consult your Real Estate agent about the rules that apply to EMDs in your region of the country. You should also be aware that the EMD is not related to any down payment that you make toward your home loan.

Avoid Top 10 Mistakes Made By Real Estate Investors

2008-07-24T09:32:00.000-07:00

Real estate investment is perhaps one of the most lucrative forms of investment today. But it is also equally risk bound especially when one is not well versed with the trends and nuances of the real estate market. So if you are contemplating on investing in real estate, it is best to avoid costly mistakes in real estate investment especially when you invest your hard earned money into it. Knowing the most common mistakes made by real estate investors helps one steer away from making such mistakes in the future and ensures good return on investment.

Here are the top ten mistakes made by real estate investors, according to bankrate.com. Bankrate has put together the top ten mistakes after speaking to established, full-time real estate investors and other professionals involved in real estate investment such as bankers. Read on to know them and avoid them.

1. Not planning up ahead. Lack of a proper plan is the biggest mistake made by novice investors. Finding a house after forming a proper investment strategy is the right way instead of looking for a house to fit the plan. Many make the mistake of buying a house because it seems to be a good deal and then trying to see how they can fit it into their plan. Instead of buying a house and thinking one can plan in due course, investors should rather concentrate on the numbers and try to make offers on multiple properties. This will ensure a good property that not only matches their investment model but also works out well with the numbers they had planned for.

2. To believe you can make money quickly. The second major mistake that real estate investors make is to think it is very easy to get rich in real estate. This is only a myth and the reality is that investing in real estate is a long term project.

3. Doing it single-handedly. For becoming a successful real estate investor one needs to build a team of professionals who would assist the investor in his deals. This would ideally include a real estate agent, an appraiser, a home inspector, a closing attorney and a lender.

4. Making excess payment. One another reason that investors in real estate goof up in their investment is by paying too much for the properties they buy. Paying too much and locking up all the funds in the erred property deal will leave you with no money to redeem yourself.

5. Leaving out the groundwork. Not doing your homework could be a costly mistake if you were a real estate investor. Every field of business needs sufficient amount of homework to be done, and real estate investment is no exception. Learn the fundamentals and then venture into investing in properties.

6. Throwing caution to the winds. Investors have to exercise a certain degree of caution and take earnest efforts while making a deal. New investors often fail in this regard and sign a deal without doing adequate research on the property.

7. Miscalculating money flow. Investors whose strategy is to buy, hold and rent out properties need to ensure sufficient cash flow for maintenance. Property managers could be expensive and the owner has to incur more expenses such as mortgage, taxes, insurance, advertising costs etc. Investors have to allocate their budget such that all these expenses are taken care of, or end up having their asset turn into a liability.

8. Lowering the volume. A larger volume of deals or transactions helps in increasing the profits by reducing the impacts of marginal deals.

9. Getting trapped in your own deal. Having more number of options at hand for the property you buy is a wise strategy. This helps one to be prepared for fluctuations in the real estate market. Plans to rent out the house could go awry when the rental market slumps. Having alternative plans helps you cut down losses and tackle unexpected situations.

10. Making incorrect estimates. People who plan to rehab their house need to check if they will still reap the benefits at double the time that they had estimated. This ensures they do not miscalculate and lose money on the deal.

Should I Choose A Real Estate Agent Or A Realtor?

2008-07-07T20:49:00.002-07:00

Whether you are buying or selling a property, many people employ the services of a real estate professional. This person’s duty is to offer help, professional expertise and generally make the real estate experience easier for you by guiding you through the process.

What Is The Difference Between An “Agent” and a “Realtor?”

The words ‘real estate agent’ and ‘realtor’ are used interchangeably but there is actually a difference between the two. A real estate agent is salesperson licensed by the state, and given legal permission to represent consumers in the sale of, or purchase of homes on the open real estate market.

A Realtor is a real estate professional who is an active member of the National Association of Realtors (NAR) - a key supporting real estate organization. The NAR offers ongoing education, legal information, contractual updates, information on governmental regulations affecting the real estate industry, etc. Realtors might consist of appraisers, property managers, loan officers, and brokers. Therefore, not all Realtors are real estate agents.

Is One Better Than The Other?

Some Realtors have lots of success in helping consumers, while some Agents struggle to satisfy their clients. At the same time, many Agents can be extremely efficient, while some Realtors can find themselves unsuccessful. Association with any national organization can’t guarantee anything. Some people prefer Realtors because they have a preference due to the national accreditation of NAR. Also, all Realtors must comply with the standard set by NAR, which in part gives the client some additional assurance of ethical conduct.

What Are The Qualities Of A Great Real Estate Professional?

It’s important that you select a qualified agent that you feel comfortable working with. Choose a person who has worked with someone you know, or a person who has a positive reputation within the community. A high quality real estate professional will make your transaction as smooth as possible and be forthcoming and honest about the details. That person will ask you questions, listen to your answers and recognize what you’d like to accomplish. Then will guide you towards obtaining your goal in a strategic, organized and successful way.

5 Tips for Buyers to Determine the Quality of a Condo

2008-07-07T20:49:00.001-07:00

Even if you aren’t technically trained, there are easy ways to judge the quality of condo construction. Book an appointment to view the property and bring along a flashlight, a “night light”, and a golf ball. Then follow these five simple tips:

#1 Test the Major Appliances and Heating/AC Units

When you arrive at the condo, begin by testing the heating and air conditioning systems. Turn on the oven and the heat. If you’re viewing the property in winter, you may prefer to turn off the heat and crank up the air conditioning. As you tour the condo, these systems will have time to boot-up and prove their worth, and if they aren’t functioning properly you’ll be able to detect it within 10 or 15 minutes. Make sure that heat or air conditioning is delivered to every part of the condo, and that the oven heats up in a timely manner. Just be sure to turn everything off or back to the original settings before you leave.

#2 Check the Plumbing and Electrical Systems

As you walk from room to room, check the plumbing by briefly turning on the various taps and watching to see if the water pressure is sufficient and if drainage is fast. Slow drains may just need cleaning to remove clogs, but lack of pressure in any building – or sluggishness in a brand new condo – may mean that the plumbing system is inadequate.

Turn on lights in every room, and use the “night light” you brought to test the wall outlets. If you plug it in and it doesn’t light up, the outlet is probably dead. Any outlet near water – such as in the kitchen and bathrooms – should be the special kind that interrupts the flow of electricity in the event of a power surge. If the condo does not have them it needs upgrading. Three-prong outlets are important for rooms where you will operate computers and small appliances, so survey the condo to determine if those are present in sufficient numbers.

#3 Check the Walls, Ceilings, and Floors

Examine the ceilings and walls, using your flashlight, and look for spots where there may have been leaks or patch repairs. Study the areas around door and window frames and in the corners of the room for splits, cracks, or gaps. If the walls appear bowed or the lines where the walls and floor or walls and ceiling meet seem off-kilter, that may be a sign of warping or sloppy framing.
Put the golf ball you brought in the middle of a bare floor. If it rolls to the other side of the room, the floor is tilted. Test the doors to see if they automatically open or close all by themselves, which is another confirmation that the construction is askew. If, on the other hand, your golf ball or door stays where you left it, the room is probably level and balanced.

#4 Read the Property Offering, Disclosures, or Minutes of the Condo Association Meetings

Read the descriptions in the property offering for new condos, or the minutes of association meetings for existing properties. The amenities itemized in the offering should match what you see in the condo, and this includes the brands of appliances as well as the quality of any features such as flooring or counter tops.
If the condo is an older one, then study the minutes of the condo association meetings and look for mentions of repairs or service calls to the property. Repeated repairs may be a red flag, or it could simply indicate a responsive and responsible association, but you will need to investigate further to find out for yourself.
Study any official disclosures, and beware of buying a condo that has had previous problems with flooding, fire, environmental hazards, or other catastrophic scenarios.

#5 Do Some Fact Checking of Your Own

To find out what kind of quality you are getting for your money, make a few phone calls. If the builder touts a particular brand of insulated windows or hardwood flooring planks, for example, call the local distributors and find out how much they sell those particular items for, and then tally up how much you’re paying versus how much the builder is delivering.

You might discover that so-called top-of-the-line products used in the construction of the condo are actually cheap and inferior. Or you could be pleasantly surprised to learn that you are getting excellent materials for a discounted price because your builder has more buying power than you do and negotiated a good deal for your benefit.

Before buying any home, you should always hire a licensed and qualified inspector to provide you with a full professional report on the condition of the property. But the above tips will save you time while you do your preliminary shopping to narrow down your condo selection.

Whether you’re buying, selling, or refinancing, contact the professionals at http://www.GayMortgageLoans.com and http://www.GayRealEstate.com. Or call toll-free at 1-888-420-MOVE (6683). Experienced brokers dedicated to the GLBT community are ready to serve you.

Mortgage Crisis Tips

2008-07-07T20:48:00.001-07:00

A year ago most Americans had never encountered the word “subprime”, but today it is a notorious household word. And in too many households, it is uttered with contempt, despair, frustration, or some combination of those stressful emotions. The fact is that all of us – even those who have good credit and no mortgage whatsoever – have been somewhat affected by the so-called subprime mortgage crisis. What was originally explained as an isolated problem limited to an obscure portion of the overall mortgage market has now become a far-reaching global financial problem.

While the mess did start within the subprime industry – which accounts for only a tiny percentage of American home mortgages – it has now become everyone’s problem, either directly or indirectly. By the end of the third quarter of 2007 it had become widely acknowledged and conspicuously apparent that the subprime lending catastrophe had spilled over into a wide range of sectors beyond the high-risk lending arena. Experts have even predicted that the entire USA economy could plunge into a severe recession, thanks to the current mortgage and housing crisis. What this means for the average homeowner or buyer of real estate is that the market has changed dramatically.

Here are some insights into the current mortgage situation, and how it may impact your ability to take out a new mortgage or refinance an existing one:

The Proposed Rate Freeze

Much of the trouble with loans and interest rates involves adjustable rate mortgages with so-called “teaser” rates that start off at super-low, highly attractive rates. Homeowners pay relatively small amounts for the first few years, but then the rates readjust. Because prevailing rates have climbed dramatically, the readjustments often mean that monthly payments spike and can even double. Borrowers find themselves unable to make the new payments so they default.

Approximately 2 million of these ARM loans will reset higher within the next 18-24 months, so government officials have called on lenders to allow a temporary rate freeze or moratorium on resets. They hope this will give homeowners time to get back on their feet. Investors who backed these loans may disagree, so the proposal might get stalled. Even if it does go through, only homeowners who have keep up with their payments will qualify for the freeze. So it pays to keep up with your mortgage – even if it means financial sacrifices elsewhere.

Refinancing and Home Equity Loans

Lenders including Citigroup, J.P. Morgan Chase, and Wells Fargo have been lowering the maximum amount that borrowers can finance in some particular locations of the country where home prices are falling especially fast. Your chances of qualifying for a refinance may be diminished if you live in an especially foreclosure-prone area, even if your own home has maintained its value.

Lenders are also taking a harder look at appraisals, credit reports, and income. Applying for a refinance or a home equity loan during the mortgage crisis will be more challenging, so it is important to bolster your credit, provide excellent documentation, and be realistic about pricing and market value in terms of equity or sales prices of listed homes.

The Status of Jumbo Loans

Buyers who need jumbo loans – those unconventional mortgages exceeding $417,000 – will find that they are also in short supply, just like high-risk subprimes. The reason is that both subprimes and jumbos depend heavily upon private investment for their source of capital, and many private investors are sitting on the sidelines of the current tumultuous market. So if you plan to buy an expensive home and expect to borrow with a jumbo, you can expect to pay a hefty premium. Rates of jumbos have jumped considerably, and some mortgage brokers cannot even find jumbos for their clients, except at prohibitive prices.

If you are shopping for a jumbo at this time, one strategy is to first shop long and hard for an excellent and well-connected mortgage broker who charges reasonable fees. Less experienced brokers may not have the resources to locate a jumbo, or they may only be able to arrange them with those lenders who charge top dollar. For buyers who are close to the price of a conventional loan, it may be better to use two loans and piggyback them to come up with the funds. A conventional loan for just under $417,000 can pay for most of the purchase, and then you can take out a smaller loan – that you’ll pay higher interest on but can hopefully pay off or refinance soon to a better rate – for the remaining balance.

To successfully navigate today’s market is not impossible, so don’t despair. You just need to employ a fresh perspective, updated information, and reliable resources – including experienced and trustworthy lenders who can creatively assist with borrowing hurdles, options, and decisions.

Whether you’re buying, selling, or refinancing, contact the professionals at http://www.GayMortgageLoans.com and http://www.GayRealEstate.com. Or call toll-free at 1-888-420-MOVE (6683). Experienced brokers dedicated to the GLBT community are ready to serve you.

Where Are Private Lenders And How Do I Find Them?

2008-07-07T20:47:00.000-07:00

Private lenders are typically not loaning on real estate. You want to look at those people who are earning low interest rates. You can’t convince someone who is already earning 20% that they should do this with you because unless you want to pay more than 20% interest, it wouldn’t make sense to them. People who have their money in low yield vehicles are the people you need to talk to. The best opportunity is when people have their money in IRAs. IRAs are typically paying 1 to 2 % interest. The other great thing about that is that people that have money in an IRA can’t touch that money until they are 60 or 65 years old, so they are a little more willing to lend out that money because it is not something they are not dependent upon for living each and every day. They also don’t realize that the government will allow them to make loans from their IRA and decide their own interest rates. The fact is you can create a self directed IRA. Not all banks will do that.

You have to find a 3rd party administrator that will handle a self directed IRA. All they have to do is roll over their current IRA into a self directed IRA and then they can start making the loans themselves. Once you show a potential lender that they can do this and start earning 8-10% interest, they get very excited. This is money that they didn’t think they could touch. It’s money that they are not looking for until their retirement. Now you are showing them how they can get 5 and 6 times what they are currently earning on their money. That is an incredible benefit to them.

There is advertising you can do to find private money lenders, but the best way to find them is to just start talking. If you just talk to people and start talking about real estate investing in general, they will start to ask you questions like how you find deals and where you get the money to fund them. This gives you the opportunity to talk about private lenders but without having to “sell” them on the idea. You are just explaining your business and how it works. Always end your conversation with “I’m always looking for more private lenders. If you know of anyone who would be interested, please give them my contact information.” I guarantee you that 90% of the time those individuals will say well I have some money would you be interested in using mine? Especially if throughout the description of your program you have told them what kind of interest they are going to make, how safe the money is, and also that you accept smaller loans. Most people don’t realize that you would be willing to except smaller amounts of money. They assume they would have to loan $100’s of thousands.

Lou Castillo has been successfully investing in real estate since the early ‘90’s. Castillo was on his way up the corporate ladder until he recognized that real estate offered a greater opportunity for financial freedom, and for the lifestyle he desired. Lou has a knack for developing powerful & proven systems that work in real estate and has authored more than 7 books and courses on the subject.
For more information or to sign up for Lou’s Powerful real estate Investing Tips go to: http://www.FreeRealEstateStrategies.com
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Flip and Grow Your Real Estate

2008-07-07T20:44:00.000-07:00

Real Estate has always been a good way to make money. Some people do it to try and get rich. Others do it as a career path. Either way the term Flip This House has become popular the last few years making the term common.

Flip a house and making profit is and has always been a good way to make money. Even though Real Estate markets go up and down over time, there usually is a good chance that over time, the worth of a property always increases. This makes Real Estate a good target for people who are trying to grow their wealth.

Making sure your future is financially secure, is a very important issue that needs to be addressed in today’s world. Real Estate is a proven and good way to make money, if not now, the future. Its always good to invest your money in things that you can sell later for more money than you originally paid for it.

Flip and grow Real Estate is another term that you may hear. If you plan on making Real Estate a way to make money, do your research and homework in advance. If you find a property that you want to buy, study that specific situation. Find out how much money it will cost you. Look at the house or building or land and determine what will be the cost involved in making it ready for sale.

When you get ready to sell a property, you should have already known before you reach that point what the cost will be. Also, its important to have backup plans in place. For example, if the house doesn’t sell, will you rent it out or come up with some other avenue to completed the cycle of the project.

Its always good to get advice.

5 Ways To Advertise Your Real Estate Business

2008-07-02T12:21:00.001-07:00

With the introduction of new products and the growth of the purchasing power of the people continually escalates, it can be said that the advertising industry became fully energized. That's why even with the dawn of the new technology, advertising still continues to dominate the business world. As most business people asserts, business can never succeed without advertising.

And so, in the real estate business, advertising remains to proliferate with more ways that could increase productivity.

However, for those who still don't know how to maximize the potential of advertising in increasing their real estate sales, here are some ways to brood over:

1. Web site listings.

Real estate businesses may consider the benefits of advertising their products or services online. In this manner, they could even increase their market share by accessing those who cannot be reached by simple ways of promotions and advertising.

People behind the real estate business may choose from the different web site listings available in the Internet today.

2. Search engines registration.

Real estate businessmen may also opt for the sear engines that are available in the Internet. With a reasonable amount, real estate businesses may promote their products online and may get more exposure through search engines. Two of the most common search engines are Google and Yahoo. So, if the business is listed at these sites, chances are they'll reap more profits than they could imagine.

3. Banner ads.

Banner ads are those ads that appear on top of a certain sponsoring website. It contains the business' name and the hyperlink that connects the customer to the business' site.

In this way, real estate entrepreneurs may take the chance of increasing their exposure online by letting the people know that they exist.

4. Emails.

Real estate businesses may also resort to this kind of advertising. Though, special considerations should be made when constructing emails so that it will not be categorized as spam.

Also, to maximize the use of this advertising technique, the real estate business must also have an email list of their potential buyers.

5. The basics.

It still pays to be traditional. In fact, one of the best ways to advertise a product is to use the traditional method of advertising - the print and the broadcast advertisements. There are people who would rather see the ads on television or in newspapers than online.

But whatever type of advertising a real estate business use, one thing is bound to help them boost their sales and profit. It just needs the skill to decide which would go best with the business.