Apr 242014
 

homeownersinsuranceAre you considering becoming a real estate market? Are you buying your home or perhaps a second one to renovate? This article can help you get the real estate investor. Use this information you make smart choices. You are going to be in much better off for the experience.

Be certain you spend a long while dealing with the endeavor to really understand it. You might have to curtail your time wisely if you want to make good profits consistently.Ditch the poker night or another guilty pleasure so you go to in order to become a better investor.

Problems with tenants may consume a lot of time for you.

Be sure to choose regions that are in a well-known area in which potential tenants might be interested. This is something that’s important because it will be easier to sell the resale value of your purchase. Try finding property that you can be kept up easily.

Do not assume property will go up in value. This assumption can end up costing you a large sum of property. The most reliable investments are the ones that will give you profits right away. Property value appreciation will then add to your income.

Properties near businesses or water can earn you a lot of money.

When you purchase a property as an investment, make sure you’ve got a great handyman. If not, then you’ll be spending all of your profits on fixing things yourself. A reliable handyman can also be available for any tenant emergency that your tenants may spring on you at night.

Don’t buy your real estate in a bad neighborhood. Know all there is to know about the location your prospective property before you buy it. Do all of your homework before you make a decision.A good deal on a beautiful house might mean that it’s in a bad place. It might be difficult to sell and it may be easily vandalized.

Be patient when beginning. It may take a longer time than you want to invest in real estate to present itself. Don’t get nervous and put your money into something you to invest in a scenario that’s not ideal. That is not a good way to use of your money. Wait it out until the perfect opportunity comes along.

Location is the most important factor when buying real estate. Think about the location and how it might be in the possible potential.

Do a little research into the city government for any real estate market you plan on investing in. There should an official website created for that city. You may discover city planning details that can affect future real estate prices. A growing city that is growing is usually a smart place to invest.

You should have a better idea of what is involved in real estate investing after reading this article. You can make a lot of money when you approach it correctly. You may also want to purchase real estate for yourself. Begin your foray into real estate by utilizing this advice.

Mar 182014
 

Understanding the Concept to Value so That You Make More Money with Your Real Estate Investments

When you’ve made the decision to invest in real estate, form an LLC or a similar entity. This will make sure that you to be protected along with any investment you move forward. There are also great tax benefits to incorporating your business as well.

I am going to expose the concept of value. What is value? How should you look at value? If you have been searching for investments, what types of things should you look for when seeing value? If you’re trying to create value and make money with your investments, then pay attention to today’s tip on understanding value so that you learn the fundamentals to real estate value investing.

Always try to find out what the local values.Finding out the neighbors are and mortgage values in a particular area can provide an idea of the financial statements.

Understanding the very basics of value will give you a leg up on most investors so that you make smarter investments whether it’s stocks, bonds, collectibles, or real estate.

Be sure that you spend enough time on the business and also learning about how it works. You might have to give up some leisure activities in order to make more money over the long haul. Ditch poker night or softball league that you have more time to hone your investing skills.

There are two types of value:

Tenant issues can really kill your schedule.

1. CURRENT VALUE

Do not assume that real estate will go up in value. This assumption is dangerous in this market and for any one piece of property. Your best bet is to invest in properties that provide a nearly immediate positive cash flow. Property value appreciation will then add to your income.

2. INTRINSIC VALUE

Properties near business districts or waterfronts are likely to increase in value.

Current value is market price or current worth

Don’t invest a huge amount of money on real estate without researching the field first. Errors in this field can generate some major losses if you don’t watch out.

The highest price a buyer will pay – the bid price

If you buy a property and you intend to rent it out, use caution when selecting a tenant. The person will need to be able to give you money for the first month as well as a deposit. If they can’t get that kind of money together at the start, there is a high chance that they will end up falling behind on their monthly rent as well. Keep on looking for better tenets.

The lowest price a seller will accept – the asking price

Understand the value of your time is valuable. You could love rehabbing, however is the amount of labor required worth your time? Or is it better suited to looking for another great opportunity? It’s okay to make time for focusing on other important aspects of the business you have.

In essence, it’s the marketplace where buyer and seller meet a point called market value.

Be very patient when you are first starting out. Your initial real estate may take a lot longer than anticipated. Don’t become impatient and the perfect scenarios. That is not a wise use your money. Wait until a great investment comes along.

In markets where there’s a big transition – like at market tops and bottoms, there is a huge bid / ask spread or gap. A few years ago, we went through a huge transition where buyers were afraid to bid too high and sellers weren’t realistic about the big drop in real estate prices so they were asking too much – hence, there was a huge bid / ask gap. That gap has been slowly narrowing.

Think about employing a company that specializes in property management firm. The company will screen your potential renters and handles repairs. This leaves you more time to find other lucrative real estate opportunities.

Intrinsic value is the underlying value in a perfect world. Intrinsic value is not influenced by the market or economy.

Location truly is the most important factor when buying real estate investment. Think about the area you are choosing to invest in and the future.

Intrinsic value is what’s real.

Look at what the economy is expected to progress in the region. High unemployment rates and a shortage of decent jobs keep property prices down. This means that in the end you may not get small returns on your investment. A large city that is robust will have higher property values.

It’s the natural and essential value.

Make sure that you inspect the property inspected before purchase and plan on investing money into those repairs. Repairs need to be made before selling the property.Factor in a maintenance into your budget if you plan on renting out any piece of property.

It’s the real value with everything stripped away.

Start slowly with just one property. You may want to start big, but that can have drastic consequences when you’re a beginner. Begin with one and learn more about the strategy you want to use. This will benefit you to learn the game without many distractions.

Feb 202014
 

Once you know that you will be investing in real estate, establish an LLC or other such entity. This protects you and your investments. There are possible tax benefits concerning the business transactions you make.

Whether you are operating a large portfolio, a single asset or searching for a new acquisition, have you found the best strategy to reach the goals and objectives of your property’s strategic action plan? In today’s market it is critical that you have a strategic action plan for each property so that you can maximize income and value.

Always try to find out what the local values.Finding out the average rental rates and whether they rent or own can provide an idea of the financial statements.

If you were playing a game to win, you would have a strategic plan to win the game. Right? Sure you would. Well, it’s the same thing when positioning real estate assets. You need to win the game with higher NOI and continuing value appreciation to generate higher profits for you and your investors.

Dedicate some of your time to learning about and making real estate investments. You must budget your time spent on other activities in order to make more money over the long haul. Ditch the poker night or softball league that you have more time to hone your investing skills.

A strategic action plan’s primary purpose is to put into action a plan of strategies that will put your property on a course to achieving your goals and objectives. Without a plan, you might get lucky reaching your final destination, but maximizing the income and value potential of your asset(s) needs to be organized so that your properties success is predictable. Your investors want to see and understand how you plan to reach your final destination.

Stick with what you’re comfortable dealing with. You can have much more success by focusing your market niche. Whether you specialize in flipping homes, only working with starters, or starter homes, stick with what you are familiar with if you want to see success.

Since a strategy is at the core of your plan, you need to develop a strategy that best positions your property in the marketplace as a problem solver to your tenants underserved needs. Your strategies should be supported by capitalizing on your properties strengths and minimizing its weaknesses. Spend some time conducting a complete evaluation of the local market, areas comps and your properties strengths, weaknesses, and the wants, needs and desires of your potential tenant.

Do not make the assumption that your property will always increase. This is an assumption is dangerous regardless of the type of property you own. You should probably just stick with properties that can provide you with a cash from right away. Property value increases will then add to your income.

While finding the highest and best use of your property is important, it’s MORE important to find the highest and best tenant for your property. Your strategic action plan should be focused on executing a strategy that gets the highest paying tenant for your property type and class so that you can maximize NOI and value.

If you buy a property to rent it, use caution when selecting a tenant. The person will need to be able to pay both the first month along with a deposit. If they cannot meet these basic monetary requirements, there is a great likelihood that they will be poor tenants, they will also fall behind on their rent. Keep looking for better tenant.

If you have a strategic plan for your assets, review the plan. Ensure it has a strategy to attract and lease to the highest value tenant for your property. If you do not have a plan, get started, today!

Feb 052014
 

When you are searching for new investment acquisitions, do you know your exit strategy before you close on the deal? What measuring stick do you use to determine if you are going to hold a property short term or long term?

Once you think you’re going to get into real estate investing, you should set up either an LLC or a similar entity. This helps protect you and your investments. It will also help boost your chances of getting tax benefits thanks to your business dealings.

Investors use varying matrix’s to determine how long they are going to hold a property. Depending on your investment strategy, you might achieve your financial goals sooner than later, so a short term hold may be the answer. You might be in a high growth market and want to hold longer to capture more of the appreciation.

Find people that are in this business and learn everything you can from them. There are lots of people that want to get into investing in real estate. There are a lot of people who like to speak about this subject. If none are located in your area, you can find forums online where other investors hang out. Get out there and learn from your peers can teach you.

I recently interviewed one of the successful investor who built large portfolio in short time period. Here’s how he determines if the exit strategy will be short or long term:

Problems with tenants can waste a great deal of time for you.

“If I see property, and I do my rehab, and if my rents per square foot are below 70 cents, that’s going to be what I call the Casa. Casa’s usually are deals that I’m going to hold for two years because I’m below 70 cents (per foot per month), usually I’m in a submarket that – it’s okay. It’s not the strongest, and I don’t believe that submarket is going to actually improve maybe for the next five years. However, I’m buying that property for a very good discount.

Be sure to choose regions that have good reputations and where lots of people want to live. This is very important as it will give you the most amount of resale value when you go about your purchase. Try finding property that you can easily be maintained.

If I’m in a submarket that my rents per square foot are above 70 cents, I call that property a Villa. Villas are properties that my holding time is going to be anywhere between 3 to 5 years, or even more than that. I’m going to be in a submarket that I have a much stronger retail – not only mom and pop – but you’re going to find a Home Depot; maybe we’re going to find a Wal-Mart.

Properties near businesses or water can earn you a lot of money.

If I have a Casa and I have a Villa, my rehab changes a little bit. It’s going to be a little bit cheaper for Casa’s. For villas, everything’s a little bit more expensive because it’s directly related to my tenant profile. All my rehab is going to change a little bit, depending whether it’s a villa or a casa.

Understand that your time is money. You may love rehabbing properties, but is all the manual labor really the most productive use of your time? Or would you be better suited to looking for the next opportunity? This will let you to focus on the important details.

It gives us very good direction. For us, before we buy the property now, we have a very clear plan. If it’s above 70 cents it’s a Villa and below 70 cents it’s going to be a Casa. We always have a plan. “

Be very patient when you are first starting out. Your initial real estate investment transaction may not happen as fast as you expected. Don’t get anxious and the perfect investments. That is not a recipe to waste money. Wait a great investment that’s great.

Decide on a short term or long term plan and exit strategy for your properties. If your properties are in low growth markets, and you can quickly realize value, then a strategy to sell sooner may make sense. If your properties are located in high growth markets, then riding the appreciation tide may be the answer. Whatever matrix you use, make sure you have a strategy and a plan for your properties.