As real estate professionals, it\u2019s our job to make the real estate buying and selling process as easy as possible for everyone involved. That means providing quality information that can benefit you immediately. We care about this community and whether you\u2019re buying or selling. We want to share some important information with you that will help you in your next move.<\/p>\n
The following reports will not only SAVE you money, but can make you money in real estate!<\/p>\n
Please let us know if we may be of any further assistance!<\/p>\n
When it comes to investing, everybody has certain goals and aspirations. However, we have found that there are certain guidelines every aspiring real estate investor needs to know:<\/p>\n
1. Compare Property Values and Rents
\nFinancial statistics only go so far; the best measure of a property\u2019s market value is often the sale prices of nearby properties. The same holds true for area rents. A low price can often be justified by a reasonable rent; renters who can afford a high rent can afford to buy instead, so reasonably priced rent is a need.<\/p>\n
2. Be careful \u2013 Tax laws may change
\nDon\u2019t base your tax investment on current tax laws. The tax code is constantly changing, and a good investment is a good investment regardless of the tax code. The right property with the right financing is what you should look for as an investor.<\/p>\n
3. Specialize in something you Know
\nStart in a market segment you know. Whether you focus on fixer-uppers, foreclosures, starter homes, low-down payment properties, condominiums, or small apartment buildings, you\u2019ll benefit from experience by specializing in one aspect of investment real estate properties.<\/p>\n
4. Know the Costs going in!
\nKnow the financial statements inside out. What are operating expenses? What are loan payments? Vacancy costs? Taxes? What does the cash flow statement look like? These are key issues that must be addressed before making a solid investment.<\/p>\n
5. Know where your tenants are coming from
\nIf the last rent increase was recent, your tenants may be considering a move. If tenants have a short-term lease, they may be living there simply to attract unsuspecting buyers. It is also important to collect the tenants\u2019 security deposits at closing.<\/p>\n
6. Assess the tax situation
\nTaxes are an integral part of successful real estate investing, and They often make the difference between a positive cash flow and a negative one. Know the tax situation, and see how it can be manipulated to your advantage. It may be a good idea to consult a tax advisor.<\/p>\n
7. Investigate insurance coverage
\nIf seller\u2019s coverage is based on lower-than-current replacement value, your insurance cost may increase when you pay a higher purchase price.<\/p>\n
8. Confirm Utility Costs
\nAsk the local utilities to verify recent utility expenses, especially if any of these costs are included in your tenant\u2019s rent.<\/p>\n
9. Consult Your Accountant
\nTaxation is a key element of successful real estate investing, so be sure to find an accountant who is well-versed with the constantly evolving tax code.<\/p>\n
10. Inspect!
\nMake sure that you always perform a thorough inspection of the property before buying it. Never, ever buy any property without at least examining the site. In some cases, hiring professional inspectors to examine the structural mechanical system may be a sound investment.<\/p>\n<\/div><\/div>\n
1. Get \u201cPre-Approved\u201d \u2013 Not \u201cPre-Qualified!\u201d
\nDo you want to get the best property you can for the least amount of money? Then make sure you are in the strongest negotiating position possible. Price is only one element in the negotiations, and not necessarily the most important one. Often other terms, such as the strength of the buyer or the length of escrow, are critical to a seller.<\/p>\n
In years past, I always recommended that buyers get \u201cpre-qualified\u201d by a lender. This means that you spend a few minutes on the phone with a lender who asks you a few questions. Based on the answers, the lender pronounces you \u201cpre-qualified\u201d and issues a certificate that you can show to a seller. Sellers are aware that such certificates are WORTHLESS, and here\u2019s why! None of the information has been verified!<\/p>\n
Many times unknown problems can come to the surface! Some of the problems I\u2019ve seen include recorded judgments, alimony payments due, glitches on the credit report due to any number of reasons both accurately and inaccurately, down payments that have not been in the clients\u2019 bank account long enough, etc.<\/p>\n
So the way to make the strongest offer today is to get \u201cpre-approved\u201d. This happens AFTER all information has been checked and verified. You are actually APPROVED for the loan and the only loose end is the appraisal on the property. This process takes anywhere from a few days to a few weeks depending on your situation. It\u2019s VERY POWERFUL and a weapon I recommend all my clients have in their negotiating arsenal.<\/p>\n
2. Sell Your Property First, Then Buy the House
\nIf you have a house to sell, sell it before selecting a house to buy! Contingency sales aren\u2019t nearly as strong as one that comes in with a ready, willing and able buyer. Consider this scenario: You\u2019ve found the perfect house \u2013 now you have to go make an offer to the seller. You want the seller to reduce the price and wait until you sell your house. The seller figures that this is a risky deal, since he might pass up a buyer who DOESN\u2019T have to sell a house while he\u2019s waiting for you. So he says OK, he\u2019ll do the contingency but it has to be a full price offer! You have now paid more for the house than you could have because of the contingency, and you have to sell your existing house in a hurry! Otherwise you lose the house! So to sell quickly you might take an offer that\u2019s lower than if you had more time. The bottom line is that buying before selling might cost you THOUSANDS of dollars.<\/p>\n
If you\u2019re concerned that there is not a house on the market for you, then go on a window-shopping trip. You can identify possible houses and locations without falling in love with a specific house. If you feel confident after that then put your house on the market.<\/p>\n
Another tactic is to make the sale \u201csubject to seller finding suitable housing\u201d. Adding this phrase to the listing means that WHEN YOU DO FIND A BUYER, you will have some time to find the new place. If you don\u2019t find anything to your liking, you don\u2019t have to sell your present home.<\/p>\n
3. Play the Game of Nines
\nBefore house hunting, make a list of things you want in the new place. Then make a list of the things you don\u2019t want. You can use this list as a guide to rate each property that you see. The one with the biggest score wins! This helps avoid confusion and keeps things in perspective when you\u2019re comparing dozens of homes.<\/p>\n
When house hunting, keep in mind the difference between \u201cSTYLE AND SUBSTANCE\u201d. The SUBSTANCE are things that cannot be changed such as the location, view, size of lot, noise in the area, school district, and floor plan. The STYLE represents easily changed surface finishes like carpet, wallpaper, color, and window coverings. Buy the house with good SUBSTANCE, because the STYLE can always be changed to match your tastes. I always recommend that you imagine each house as if it were vacant.<\/p>\n
Consider each house on its underlying merits, not the seller\u2019s decorating skills.<\/p>\n
4. Don\u2019t Be Pushed Into Any House
\nYour agent should show you everything available that meets your requirements. Don\u2019t make a decision on a house until you feel that you\u2019ve seen enough to pick the best one.<\/p>\n
A decade ago, homes were selling quickly, usually a few days after listing. In that kind of market, agents advised their clients to make an offer ON THE SPOT if they liked the house. That was good advice at the time. Today there isn\u2019t always this urgency, unless a home is drastically underpriced, and you\u2019ll know if it is.<\/p>\n
Don\u2019t forget to check into the SCHOOL DISTRICTS of the area you\u2019re considering. Information is available on every school; such as class sizes, % of students that go on to college, SAT scores, etc. You can get this information from this web site.<\/p>\n
5. Stop Calling Ads!
\nPlease note \u2013 ads are sometimes created to make the phone ring! Many of the homes have some drawback that\u2019s not mentioned in the ad, such as traffic noise, power lines, or litigation in the community. What\u2019s not mentioned in the ad is usually more important than what is.<\/p>\n
For this reason, I want you to be very careful when reading ads. Remember that the person writing the ad is representing the seller and not you! The most important thing you can do is have someone on your side looking out for your best interests. Your own agent will critique the property with an eye towards how well it meets your needs and will point out any drawbacks you should know about. So whether you decide to work with me or not, pick an agent you feel comfortable with and enlist the services of that agent as a buyer\u2019s broker. Then you become a client with all the rights, benefits, and privileges created by this agency relationship, and you\u2019re no longer just a shopper. Did you know that many homes are sold WITHOUT A SIGN ever going up or an AD EVER BEING PUT IN THE PAPER? These \u201cgreat deals\u201d go to those people who are committed to working with one agent. When an agent hears of a great buy, who do you think he\u2019s going to call? His client, who he has a legal obligation to work hard for you, or someone who just called on the phone and said \u201ckeep your eyes open\u201d? So to get the best buy on a property, I always recommend that you hire your own agent and stick with him or her.<\/p>\n<\/div><\/div>\n
Less is more!
\nIf you\u2019re new to investing or real estate and don\u2019t know the first thing about interest rates, here\u2019s a good tip: the higher the interest rate, the more expensive it\u2019s going to be. High interest rates mean you will have to pay back more on the money you borrow. Another good rule of thumb is that affordability increases if you use an adjustable rate mortgage (it\u2019s easier to qualify this way). Of course, there will be a wide range of prices that you can choose from, depending on what kind of financing you choose..<\/p>\n
Not even the Fed knows for sure
\nThe Fed holds a considerable amount of power, but they can\u2019t control everything. Mortgage interest rates are affected by many unpredictable political, economic and social events. So there is no guarantee what direction interest rates will go, despite the forecasts of the experts. Therefore, make your financial decision based on where things are today including your budget, your needs and your future plans.<\/p>\n
Locking in rates assures your lowest interest
\nIf you do decide you want to lock in at a certain interest rate, you will need to complete a loan application and send it to your lender as soon as possible. This must be done so that your commitment doesn\u2019t runout before your loan is approved. Follow up and be se sure that the lender is receiving all of the necessary documentation. Get a property appraisal, which usually costs about $300, through your loan agent as soon as possible.<\/p>\n
Don\u2019t obsess and miss a good real estate deal
\nAlthough rising interest rates can create more problems for home buyers, waiting and hoping for low rates is not necessarily a smart move. You may end up paying a higher price. Also, refinancing is always an option in the event that interest rates come down.
\nVisit again soon! I have more information that you will need!<\/p>\n<\/div><\/div>\n
Finding the right real estate professional requires doing a little research and asking a few questions. You need to know everything about the selling process. What is the marketing strategy? What kind of advertising will be done? Is the REALTOR\u00ae capable and willing to communicate effectively? Can the REALTOR\u00ae effectively present and sell the less-noticeable assets of the property?<\/p>\n
Real estate professionals also need to be knowledgeable about the community. They need to have a feel for the history of the area and the approximate price that people will be willing to pay. Also, real estate agents should know what the competition is and how much it will effect your sale.<\/p>\n
NEVER choose a REALTOR\u00ae on price alone. Remember that a REALTOR\u00ae cannot magically raise the selling price of the house. Consider the buyer. The purchaser won\u2019t willingly pay too much; it\u2019s most likely that he or she will do research on the market and try to find the best product for the best price. The facts simply cannot be changed, no matter which REALTOR\u00ae you select. In spite of these unchangeable factors, the REALTOR\u00ae you select must still be diligent and knowledgable.<\/p>\n
If your property does not elicit attention within several weeks, the cause can most likely be attributed to one of these three factors: location, condition, and price. The location obviously cannot be changed. You should consider examining the conditioning of your property and reevaluating the marketing strategy. Ask your REALTOR\u00ae to offer an explanation of the competition and your pricing strategy.<\/p>\n<\/div><\/div>\n
Lower Your Taxes
\nTax incentives for real estate investors can often make the difference in your tax rates. Deductions for rental property can often be used to offset wage income. Tax breaks can often enable investors to turn a loss into a profit.<\/p>\n
For which items can investors get tax breaks? You could claim deductions for actual costs you incur for financing, managing and operating the rental property. This includes mortgage interest payments, real estate taxes, insurance, maintenance, repairs, property management fees, travel, advertising, and utilities (assuming the tenant doesn\u2019t pay them). These expenses can be subtracted from your adjusted gross income when determining your personal income taxes. Of course, these deductions cannot exceed the amount of real estate income you receive. In addition to deductions for operating costs, you can also receive breaks for depreciation. Buildings naturally deteriorate over time, and these \u201closses\u201d can be deducted regardless of the actual market value of the property. Because depreciation is a non-cash expense \u2014 you are not actually spending any money \u2014 the tax code can get a bit tricky. For more information about depreciation and various tax alternatives, ask your tax advisor about Section 1031 of the U.S. Tax Code.<\/p>\n
Have a Positive Cash Flow
\nThere are two kinds of positive cash flows: pre-tax and after-tax. A pre-tax positive cash flow occurs when income received is greater than expenses incurred. This sort of situation is difficult to find, but they are usually a strong and safe investment. An after-tax positive cash flow may have expenses that outweigh collected income, but various tax breaks allow for a positive cash flow. This is more common, but it is generally not as strong or safe as a pre-tax positive cash flow.<\/p>\n
Regardless of what kind of real estate you choose to invest in, timely collections from your tenants is absolutely necessary. A positive cash flow \u2014 whether it be pre-tax or after-tax \u2014 requires rental income. Be sure to find quality tenants; a thorough credit and employment check is probably a good idea.<\/p>\n
Use Leverage
\nOne of the most important factors in determining a solid investment is the amount of equity you are purchasing. Equity is the difference between the actual worth of the property and the balanced owed on the mortgage.<\/p>\n
Benefit from Growing Equity
\nWhile investing in real estate is relatively complex, it is often worth the extra work. When compared to other financial investments, like bonds or CD\u2019s, the return on investment for real estate purchases can often be greater.<\/p>\n
The key to real estate investing is equity. Determine an amount of equity that you want to achieve. When you reach your goal, it\u2019s time to sell or refinance. Determining the proper amount of equity may require the assistance of a real estate professional.<\/p>\n<\/div><\/div>\n
Easing the Transition to Your New Home
\nUse the right boxes, and pack them carefully. Professional moving companies use only sturdy, reinforced cartons. The boxes you can get at your neighborhood supermarket or liquor store might be free, but they are not nearly as strong or padded, and so can\u2019t shield your valuables as well from harm in transit.<\/p>\n
Use sheets, blankets, pillows and towels to separate pictures and other fragile objects from each other and the sides of the carton. Pack plates and glass objects vertically, rather than flat and stacked.<\/p>\n
Be sure to point out to your mover the boxes in which you\u2019ve packed fragile items, especially if those items are exceptionally valuable. The mover will advise you whether those valuables need to be repacked in sturdier, more appropriate boxes.<\/p>\n
The heavier the item, the smaller the box it should occupy. A good rule of thumb is if you can\u2019t lift the carton easily, it\u2019s too heavy. Label your boxes, especially the one containing sheets and towels, so you can find everything you need the first night in your new home.<\/p>\n
For your family\u2019s safety and comfort
\nTeach your children your new address. Let them practice writing it on packed cartons. You can lighten your load and reduce any storage space you need to rent by hosting a garage or yard sale.<\/p>\n
Fill two \u201cOPEN ME FIRST\u201d cartons containing snacks, instant coffee or tea bags, soap, toilet paper, toothpaste and brushes, medicine and toiletry items (make sure caps are tightly secured), flashlight, screwdriver, pliers, can opener, paper plates, cups and utensils, a pan or two, paper towels, and any other items your family can\u2019t do without. Ask your van foreman to load one of these boxes, so that it will be unloaded at your new home first. Why the second box? In case the movers are delayed getting to your house on the day of the move.<\/p>\n
Keep your pets out of packing boxes and away from all the activity on moving day.<\/p>\n
Let all your electrical gadgets return to room temperature before plugging them in.<\/p>\n
Since you may need to call old neighbors or businesses from your new home, pack your phone book.<\/p>\n
Work hand in hand with your mover
\nGive the mover\u2019s foreman your reach numbers and email addresses so you can stay in contact.<\/p>\n
Read the inventory form carefully, and ask the mover to explain anything you don\u2019t understand. Make a note of your shipment\u2019s registration number, and keep your Bill of Lading handy.<\/p>\n
If you\u2019re moving long distance, be aware that your property might share a truck with that of several other households. For this reason, your mover might have to warehouse your furniture and belongings for several days. Therefore, ask your mover whether your goods will remain on the truck until delivered. If they have to be stored, ask whether you can check the warehouse for security, organization and cleanliness.<\/p>\n<\/div><\/div>\n
Mistake #1 \u2014 Pricing Your Property Too High
\nEvery seller obviously wants to get the most money for his or her product. Ironically, the best way to do this is NOT to list your product at an excessively high price! A high listing price will cause some prospective buyers to lose interest before even seeing your property. Also, it may lead other buyers to expect more than what you have to offer. As a result, overpriced properties tend to take an unusually long time to sell, and they end up being sold at a lower price.<\/p>\n
Mistake #2 \u2014 Mistaking Re-finance Appraisals for the Market Value
\nUnfortunately, a re-finance appraisal may have been stated at an untruthfully high price. Often, lenders estimate the value of your property to be higher than it actually is in order to encourage re-financing. The market value of your home could actually be lower. Your best bet is to ask your REALTOR\u00ae for the most recent information regarding property sales in your community. This will give you an up-to-date and factually accurate estimate of your property value.<\/p>\n
Mistake #3 \u2014 Forgetting to \u201cShowcase Your Home\u201d
\nIn spite of how frequently this mistake is addressed and how simple it is to avoid, its prevalence is still widespread. When attempting to sell your home to prospective buyers, do not forget to make your home look as pleasant as possible. Make necessary repairs. Clean. Make sure everything functions and looks presentable. A poorly kept home in need of repairs will surely lower the selling price of your property and will even turn away some buyers.<\/p>\n
Mistake #4 \u2014 Trying to \u201cHard Sell\u201d While Showing
\nBuying a house is always an emotional and difficult decision. As a result, you should try to allow prospective buyers to comfortably examine your property. Don\u2019t try haggling or forcefully selling. Instead, be friendly and hospitable. A good idea would be to point out any subtle amenities and be receptive to questions.<\/p>\n
Mistake #5 \u2014 Trying to Sell to \u201cLooky-Loos\u201d
\nA prospective buyer who shows interest because of a \u201cfor sale\u201d sign he saw may not really be interested in your property. Often buyers who do not come through a REALTOR\u00ae are a good 6-9 months away from buying, and they are more interested in seeing what is out there than in actually making a purchase. They may still have to sell their house, or may not be able to afford a house yet. They may still even be unsure as to whether or not they want to relocate.<\/p>\n
Your REALTOR\u00ae should be able to distinguish realistic potential buyers from mere lookers. REALTOR\u00aes should usually find out a prospective buyer\u2019s savings, credit rating, and purchasing power in general. If your REALTOR\u00ae fails to find out this pertinent information, you should do some investigating and questioning on your own. This will help you avoid wasting valuable time marketing towards the wrong people. If you have to do this work yourself, consider finding a new REALTOR\u00ae.<\/p>\n
Mistake #6 \u2014 Not Knowing Your Rights & Responsibilities
\nIt is extremely important that you are well-informed of the details in your real estate contract. Real estate contracts are legally binding documents, and they can often be complex and confusing. Not being aware of the terms in your contract could cost you thousands for repairs and inspections. Know what you are responsible for before signing the contract. Can the property be sold \u201cas is\u201d? How will deed restrictions and local zoning laws will affect your transaction? Not knowing the answers to these kind of questions could end up costing you a considerable amount of money.<\/p>\n
Mistake #7 \u2014 Limiting the Marketing and Advertising of the Property
\nYour REALTOR\u00ae should employ a wide variety of marketing techniques. Your REALTOR\u00ae should also be committed to selling your property; he or she should be available for every phone call from a prospective buyer. Most calls are received, and open houses are scheduled, during business hours, so make sure that your REALTOR\u00ae is working on selling your home during these hours. Chances are that you have a job, too, so you may not be able to get in touch with many potential buyers.<\/p>\n<\/div><\/div>[\/vc_column_text][\/vc_column][\/vc_row]\n","protected":false},"excerpt":{"rendered":"
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