Invest in Real Estate

Real Estate Investing

2007-11-27T11:14:00.005-08:00

Real estate investing involves the purchase of real estate for profit. Profits are accumulated slowly by renting out properties in a cashflow method, or are generally improved and resold for a capital gain. In addition, real estate investors may wholesale properties as a means to make profits.

Advantages

There are many gurus out there that contend that real estate is a panacea where you cannot lose money. Although this is false, there are a number of advantages to investing in real estate. The biggest factor in marketability of an investment is supply and demand.

The first big advantage is that it is an extremely expensive product. Each sale you make generates more profit potential for this reason.

Leverage, or the ability to borrow based on the value of the property, is probably the second greatest advantage. It is much easier to finance real estate than any other product. While investing in most assets requires the purchaser to have the full purchase price available for the asset, in real estate investing, one only needs to have a fraction of the purchase price available (like 5%, 10% or 20%) as a down payment. Therefore, real estate, although incredibly expensive, is still easier to buy than say, a piece of industrial equipment of the same value.

Local advantage is rarely discussed but it stands to reason that you know your neighborhood better than a real estate investing expert would if they were in another part of the world. This creates an advantage the beginner can exploit in his market.

The bulk of the world's assets are in real estate.

One way a beginner can get started in real estate investing without taking on any personal risk is to 'bird dog', or hunt for good deals, for another more experienced investor. This allows the beginner to learn to find and recognize value.

Disadvantages

Real estate is an illiquid investment that needs maintenance and taxes to be paid. A balanced investment portfolio has some liquid assets that can be quickly converted to cash to sustain the real estate when its returns are not sufficient to pay its recurring costs.

During a real estate boom, speculators can be prone to make purchases without pre calculating the costs involved in the purchase and for the ongoing costs of a property. The real estate can then sometimes work against them instead of for them, realizing a loss at resale.

There is no guarantee that values will maintain themselves as society changes; megatrends can cause large scale changes.

Siddique is real estate investor for over 22 years and President of http://www.butterflylister.com . Download Free How to sell your Home for Full Price in any market.

Article Source: http://EzineArticles.com/?expert=M_Siddique

Tax Lien Sales - What Are Tax Lien Sales and How to Profit From Them

2007-11-27T11:14:00.004-08:00

It's amazing how few investors know the goldmine of tax lien sales. Where else can you securely invest your money for guaranteed returns of 20-25%?

Tax lien sales offer something for everyone. From the beginning investor all the way up to people with hundreds of thousands or millions of dollars to invest. You obviously buy tax lien certificates. But how does it all work? Is your investment really safe, or is it just as shaky as everything else out there?

Here's how it works. You attend the tax lien sale. You pay other peoples' back property taxes for them. They have a certain amount of time to pay up (redeem) or they lose their property. In some cases, you can wind up with a $200,000 property for the cost of its back taxes. Although rare, it does happen. So, you bid on the liens at the sale that you've done the proper research on. You should aim to invest in as many good ones as you can afford at each auction you attend. This will maximize your investment potential.

Once you've acquired all the well researched them you can afford, all you need to do is wait. The property owner will usually pay off the tax lien along with the massive interest or penalty within several months to a year. You can repeat this process over and over again at sales, with each cycle becoming more leveraged and profitable.

If you're looking for a way to safely invest your money and receive extremely high returns, you should definitely include them in your portfolio. Become sharp as a tack with your knowledge of tax lien sales and how to get the most out of every auction you attend, and you will by very successful.

You're only seconds away from learning how to achieve consistent 20-300% returns on the money you invest with complete government certified safety. Visit http://taxliencertificateguide.com to start now.

How to Invest in Real Estate Outside Your Area With Ease

2007-11-27T11:14:00.003-08:00

Many people are going outside of their own market to purchase quality real estate investments at a fraction of the price. Did you know that for example a $400,000-$500,000 home in California is similar to an $80,000 home in Dallas, Little Rock, or Memphis? Did you know that the rent on a home that price can be as high as $1000 per month or more?
Your peers are buying properties in these other markets, getting a lot of cash flow for their money and are racking up a diverse portfolio of assets quickly. Are they geniuses? Are they better real estate investors? The answer is no. Many of these people stepped outside their comfort zone, took very little risk, and now are reaping the rewards. How are they doing this? Let's take a look.
1. Taking advantage of Markets - First, real estate investors in markets that had a large run up in prices in many cases are hurting now that the appreciation is gone. The savvy investors from these markets are looking outside and they are looking for positive cash flow. Many markets in the interior of the US, especially the South, are not only growing markets but have had depressed prices for quite some time. This is a better angle to look at then for example a rust belt city in the Midwest with a declining population and factories closing up. Look where the economic growth is and the prices have been low. Example: Memphis, Dallas, Little Rock, Atlanta, Birmingham, Montgomery, and others.
2. Do your homework - Look online and find local Real Estate Investing Associations. Try www.nationalreia.com and look for associations in your target market. See if you can access the forums section of their websites. Who are the movers and shakers? Who is buying and selling a lot of property? Then look at other sites such as Craigslist in the same market. Do you see any correlation? You should see some repeat names, similar deals, etc. Use this information to start evaluating homes. Next, use Google, Yahoo, MSN, others. For example: if you Google the following, what companies surface: sample city, real estate investing, or sample city discount properties. Look for reputable companies that are selling properties. If they don't have an established website, stay away. Typically people that are one man shows don't have a good support staff.
3. Interview to build a real estate investing team - After searching on line and finding out who is buying and selling a lot of property, make a list and interview them. Find out who their support staff is. Does this buyer and seller work specifically with rehab crews? How about management companies? Closing Attorneys or Escrow Agents? You should interview 3 of each of these or more. Be brutally honest. If you can tap the wisdom of a team, the process of owning property outside your area can be easy. Make sure the management companies are willing to work with the real estate investment contractors, the sellers of your property, and so on. Ask about the reputations of each to the others.
4. Book a Flight - Make a trip to your new market to meet your team, go out into the streets, look at available property, and see everyone's office. This will often be the true test. It is easy to create a false online front, or a front over the phone, but very difficult to cover up after you show up at their doorstep. Spend 2-3 days in your market. Look at all the neighborhoods the wholesalers or agents work in. Make sure they aren't going to sell you war zones. Ask them about the rent ranges, rehab estimates, time to rent, etc. Verify these numbers with the management companies and contractors. If all checks out, proceed. The right team of people will come to light.
5. Buy and start slowly. Many people will try to push you to purchase several properties at one time. By a property or 2 within your risk threshold and see how it performs. If it performs well: wash, rinse, and repeat. You've uncovered a new real estate investing market! Hopefully you had a little fun and explored a new area too.
By using you too can profit from real estate trends taking place in undervalued markets all over the US.
To find out more about the author and investing in real estate to create passive income, visit Ryan L. Hinricher, Co-Founder of The Feol-Hinricher Companies at http://fhcompanies.com/ He and his partner Robert C. Feol have been investing in real estate and educating investors that are looking to profit from undervalued markets.

The 3 Hottest Words In Real Estate Investing For The Next 2-3 Years!

2007-11-27T11:14:00.002-08:00

Recently in the USA Today, there was a article about a Doctor who was putting 20% down on a home and had a 800 credit score.
2 Days before he was supposed to close, his funding disappeared.
A real estate broker contacts me about one of our homes available for "rent to own" and her story is almost the same except her credit score is in the 700 range.
A family man contacts me about one of or homes on a rent to own basis and tells me he has been a homeowner for years and always paid on time that is until his adjustable rate mortgage payment went from $1,600 to $3,200 and then to $3,800 3 months later.
The alarming thing is that he is not alone.
We have not even seen the majority of these ARM loans adjust yet.
But that caboose is coming down the track and nothing is going to stop it.
Foreclosures and short sales dominate the news.
Stories of mature older folks moving out and leaving the keys on the counter and calling the mortgage company and saying "come get the home the keys are on the counter" are becoming more and more commonplace.
Some investors have focused in on foreclosures and short sales and God knows there are a TON of them.
But it seems everyone is fishing out of that pond.
What most investors are missing is something that is so simple that most miss it.
No one is talking about the 3 Hottest Words in real estate investing...everybody it seems is talking about foreclosures and short sales.
What are the 3 hottest words in real estate investing at least for the next 2-3 years?
Creative Owner Financing.
The sub prime meltdown has already effected the good credit market and good luck getting a mortgage if you have bad credit
So what that means is that in the midst of a "Buyers Market" the pool of Good Credit Buyers has been reduced greatly for sellers.
Sellers are stuck and Buyers are stuck unless they learn how to bypass the "banker"
Creative Owner Financing does just that.
Those folks with marginal or bad credit who still want to own property, will have to look to creative owner financing to get the deal done.
So here is my Million Dollar Question.. Where are all of these folks that are being foreclosed on, losing their homes to short sales and ARMS... where are they supposed to live?
They are used to owning their own home and do not want to be renters yet they are shut out for sure because of their credit!
Those attempting to sell their home have seen their pool of potential buyers be decimanted by the Sub- Prime meltdown
These events have led to an unprecendented opportunity for the creative real estate investor who understands the 3 hottest words in real estate..Creative Owner Financing!
If you get the right specilized knowledge you can be the "Rain Man or Women and bring these 2 parties together and solve each of their problems and profit all because you have the right specilaized knowledge!
If you have not already, commit yourself to learning all of the methods of creative real estate investing ,especially "getting the deed" and "lease purchases" and wrap around mortgages.
"Creative Owner Financing" truly are the 3 hottest words in real estate investing today!
TC and Vickie Bradley are the authors of the #1 Best selling Real Estate Investing course "Buy with No Credit, How to Make Money this month in Real Estate!" They also do a FREE weekly webinar! http://www.buywithnocredit.com/

Something to be thankful for: Affordable housing markets

2007-11-27T11:14:00.001-08:00

In Greenwich, Conn., Boston and many parts of California, a four-bedroom house can easily set you back more than $1 million, while in parts of Texas and in the Midwest, a similar house can be had for just over $100,000.
But you knew that already. It's no secret that homes in ritzy Beverly Hills cost 10 times more than comparable houses in the military community of Killeen, Texas. The question is: How much do you really need to pay for the lifestyle you want? It might be less than you originally thought.
According to Coldwell Banker's 2007 Home Price Comparison Index (HPCI), Beverly Hills is the most expensive housing market in the nation for the second year in a row, with the average price of a home sold through July 2007 at $2.21 million. In Killeen -- the most affordable market in the U.S., according to the HPCI study -- a similar home sells for $136,725.
Killeen is a city of about 100,000 next to the Fort Hood Army base, with a military-dependent economy. You won't find anything akin to Rodeo Drive here -- but you will find community events such as fairs, concerts and high school football games; outdoor recreation such as fishing and hunting; and a pervasive sense of patriotism.

House Flipping Gone Bad Again! We Thought We Had It All Figured Out From Our Last Flip, Not Quite!

2007-11-18T15:42:00.001-08:00

I have been investing in real estate for a few years on a part time basis. My wife joined me in the investing world at the beginning of 2007 and we have flipped 4 houses this year. Our goal was 7 but we fell a bit short due to a variety of problems. In 2008 we WILL flip at least 12 houses!
The Homedale house was supposed to be a slam dunk, in and out in about 3 weeks. Our start date was delayed because our other project ran over by a few weeks so we started out on the wrong foot! We also had a new contractor named Dan that we had very high hopes for. He did a very nice job on our previous product so we expected great things from him! Read on..
When we start a project we do two things first: put up a for sale sign and start working on the outside to draw attention to the house. Homedale was a big ranch that needed a lot of work on the outside. It needed new siding, a new rail built across the front porch, new lights, new paint on the shutters and doors, and some major landscaping in the back.
The landscaping consisted of a few things. The fence line along the back yard had trees and branches and bushes that all needed to come out. It also had a pool that had been filled in with dirt and had grass and weeds that hadn't been mowed in months! We had our landscapers take the grass and weeds out and fill the pool up with mulch, large rocks, bushes and a few small trees. It looked great when it was done!
The inside needed all new flooring, new bathrooms, new lights, and a lot of minor repairs. When Dan started on the siding outside he told us that it would take him a few days to finish that. Well, he was pretty much full of crap. He started on it and a week later still wasn't finished! We needed him on the inside to do some drywall work and other things on his list so that my wife and I could get in there and paint. We decided to move him inside to keep things "on schedule".
Dan was like a lot of contractors, he will tell you what you want to hear to get the job and then screw around. At least that's my opinion! He showed up daily at 9-10 am and would leave at 2-3pm. I tried yelling at him, threatening to fire him, and I can't even remember what else I did. Needless to say it was very frustrating! I decided to call his business partner, another guy named Dan, and threaten him with firing. It worked! Finally!
Dan got his stuff done, slowly but surely, and then it was time for us to move inside and him to move back out to work on the siding. Once we got in there we saw a ton of things Dan didn't do that was on his list to do. It was past the point of having him come back in because we were behind schedule. We went ahead and finished these things and kept pushing. He finaly got the siding done about 5 weeks after he started, about 3 weeks longer than he said he was going to be in there.
We have had problems with contractors in the past so we had a signed contract that stated finish date and an agreed upon price with a penalty for going over the finish date. Obviously Dan didn't get all the money he thought he was going to get. He even had the nerve to call me after the project was finished to tell me how excited he was to work together again. YEAH RIGHT!!!
On our next project I am going to cut up the jobs a bit. I am gonig to hire a friend of mine and we are going to go in and tear out carpet, cabinets, countertops, bathrooms, etc. Then our painter will come in and prep and paint walls. After that our contractor will come in and install tile in the kitchen and bathrooms. Then our contractor will install the kitchens and bathrooms as needed. Then our carpet goes in, then we sell the house and make a lot of money!
Sounds easy right? We'll see. House flipping is something that can be incredibly profitable and at the same time can be a huge pain in the butt! I'll write again when we finish our next house flipping project!! Until then, happy real estate investing!
Jared Christiansen has flipped 8 houses over the last 3 years. He worked full time and flipped houses part time until 2007 when he started flipping full time. His wife Amanda obtained her real estate license and joined him in the business. Together they own a real estate company and have started filming their flips to show new investors the realities of the this business. Their website is http://www.Daybydayflips.com and they can be reached at DaybyDay@daybydayflips.com Jared has actually started a new blog at: http://daybydayflips.wordpress.com/ Check it out!

Speaking the Real Estate Language

2007-11-18T15:42:00.000-08:00

There are three primary financial terms that affect how we determine the value of real estate. Without a working knowledge of these terms, investors and Realtors are at a disadvantage in the market place. These terms may sound difficult to grasp but are an integral part in understanding how we determine the value of real estate and are important for commercial and residential investors alike.
The first term, net operating income, refers to the income received from an investment prior to any mortgage debt being deducted from the equation. In general, net operating income, or NOI, is defined as the total possible rents minus a vacancy rate and any operating expenses.
NOI is used to help compare investments without the uncertainty of what mortgage product you'll be using. The vacancy rate is a general rule of thumb depending upon market conditions and the type of investment. It is expressed in a percentage of gross rents. Operating expenses are those normally recurring expenses such as property taxes, insurance, management fees, repairs, etc.
So, a simple example would be an investment with $13,000 in potential yearly rent, minus a 7 percent vacancy rate, and $2,000 in operating expenses, would give us a NOI of roughly $10,000 per year.
The second term, capitalization rate, is probably least understood of all. The cap rate, for short, is an easy way to compare investments by the amount of net cash flow and their subsequent value. A simplified definition for cap rate is the cash on cash return on your investment if you paid cash for the property. The formula for the capitalization rate is: cap rate = NOI / Value.
Let's look at an example. If the NOI from our previous example is $10,000 and you determine that the property is worth $100,000, then your cap rate would be 10 percent. So, if you paid $100,000 in cash for the property you would receive $10,000 in income; and hence, a 10 percent return. That 10 percent is also your cap rate. The cap rate, as well as the NOI, has nothing to do with financing of the property. It is merely a simplified equation to determine value of a property.
The third term, which is more encompassing than the previous two, is IRR, or Internal Rate of Return. Some refer to this as ROI, Return On Investment. IRR takes the best of the previous two terms and injects the mortgage debt into the picture. It also injects the amount of your initial investment into the equation.
A quick study of IRR will prove why investors use financing. Let's use our previous example of a property with $10,000 of NOI. With 20 percent down on this investment and a 30-year mortgage of 7 percent, the annual income would be reduced to $3,613, due to the mortgage debt. But, the IRR would increase to 18 percent. This increase would be achieved even with selling the property for what you paid for it and holding it for five years. This is a definitive example of how financing greatly enhances your return on the investment.
While you can invest in real estate and never understand these financial terms, having a working knowledge of them will provide greater clarity on your future real estate decisions.
Brian Patton, CCIM is a broker and frequent speaker at the Georgia Real Estate Investors Association, the largest real estate association in the nation. For free real estate calculators to help you with investment analysis on your next real estate purchase, visit his company's website: www.capitallistings.com
http://capitallistings.com/web-links/news-articles

Beginners Guide To Flipping Houses

2007-11-12T16:40:00.002-08:00

Flipping houses is becoming big business in the world of real estate investment. Unfortunately it takes all kinds of 'flippers' to make the world go around and some of them aren't nearly as conscientious as others. If you are going to get into the business of flipping houses and want to make a living, and build a good reputation, for producing quality results you need to see to a few details throughout the process.
1) Do what needs to be done. Don't cut corners and create situations that will put the family that purchases your home in personal or financial risk. You want to create a safe home for the family or person that ultimately makes the purchase. You do not accomplish this by taking shortcuts and using shoddy workmanship.
2) Avoid spending money that doesn't need to be spent. By this I mean don't spend money creating more work. Many people do this by deciding to tackle additions, rip out walls, or changing floor plans. These kinds of changes are best left to the buyer unless they will significantly improve the asking price you can bring in on the house. Otherwise spend the bulk of your money in kitchens and baths where they are best known for bringing in bigger profits.
3) If it ain't broke don't fix it. There is a lot of wisdom in this age-old saying. There is no reason to go in and fix something that doesn't need to be fixed unless doing so will improve the value of the house to its buyers.
4) Always work within a budget. Most people set a budget when planning to flip houses but very few manage to work within that budget. This is the difference in making the profits you anticipated and putting the entire project at risk.
5) Create a home that the buyer will want to live in not the home that you will want to live in. You should never flip a house or design a flip according to your tastes; it is a recipe for disasters in more ways than one. First of all, it is unlikely that buyers will be able to afford it. Second, it sets you up for hurt feelings if a potential buyer rejects any small details. Third, it often raises the price you must seek for the property in order to cover the increased costs of decorating and designing according to your taste.
Finally, it often leads to unnecessary expenses, which defeats the purpose of a quick flip type of project... more: http://www.buyrealestate.com.cn/Beginners-Guide-to-Flipping-Houses.html
More articles about estate to visit http://www.buyrealestate.com.cn/ on this web you can find some useful information.

How To Maximize Profits On A House Flip

2007-11-12T16:40:00.001-08:00

When it comes to real estate investing a house flip is a great way to go. It's also a rather bold move for many who are considering this as a first time real estate investment. At the same time you can minimize the risk while maximizing the profit potential by following a few guidelines.
1) Have an inspection. For whatever reason there are many people who enter into a property flip situation without ever having a valid and complete inspection of the property made. This means you could be doing work that will need to be undone at some later point in the process. You want to avoid this situation if at all possible and it is easily done (in most cases) by having a thorough inspection. There will almost always however be some unanticipated surprises along the way.
2) Establish a budget and stick with it. Most people flipping houses plan a budget. Unfortunately, for whatever reason, very few actually stick to the budget they originally established. It is a good idea to leave a little wiggle room in your budget for unexpected emergencies but be firm on the spending limits for specific projects. If you go over on those projects eliminate something elsewhere in order to save money.
3) Consider the target buyer when making adjustments. You must understand when purchasing a house to flip that you are buying the house for someone else and you need to make adjustments, changes, and improvements according to what your target market demands, expects, and can afford to absorb the costs of you adding. It doesn't matter how beautiful you've made the house if no one that is willing to live in the neighborhood can afford your asking price when all is said and done.
4) Remember that this is a business situation and don't refuse to consider offers that will net you a profit just because the profit isn't as good as you'd like. A house sitting empty on the market accrues carrying costs and is ripe for all manner of disasters. You want to get in and out as quickly as possible so that you can free up your investment to move on to the next project. Entertain all offers seriously even if they aren't what you were hoping for. You never know when one might be the best you're going to get.
5) Don't take it personally. Once again a home is a very personal thing to most people. While you may have worked very hard selecting colors, materials, flooring, etc.

New Real Estate Investors Looking for 30 Day Profits? Learn To Find and Assign

2007-11-12T16:40:00.000-08:00

What's the best way to make money in real estate?
Tough question.That largely depends on WHO you are, and what your experience level is in the business.
The options range from buying and holding rental properties, buying and renting properties on a short-term lease-option, buying deals subject to an existing mortgage, to doing a short-sell on a non-performing mortgage, to buying and rehabbing properties.
Each has it's own level of complexities; most require you to assume some level of risk either in cash, credit and or time.
The key to success in real estate if you are starting out is to narrow in on ONE type of niche. Focus and learn one type of transaction FIRST then move on from there.
If you're STARTING OUT as a real-estate investor, why not learn to 'find and assign' real-estate deals?
What makes finding and assigning real estate contracts so attractive to new real estate investors?
Simply because they are VERY lurative and risk free, and easy and quick to learn.
Here are the main reasons Finding and Assigning real estate contracts is a smart option for new investors.
You Won't Need A Lot of Cash: You will not be taking title to any properties so there is no need for up front cash or any financing on your part. Earnest money required for these types of transactions is about $10.00 per deal.
No Repair Worry: Since you never actually own properties when you find and assign, rehab and repairs are not your problem. You will not be concerned with contractors, budgeting repairs, or inspections or permits.
You Will Have No Holding Costs: Again, since you take no title when you find and assign, you do not worry about payments, property taxes or insurance.
Buyers Are Ready, So are Sellers: With the recent huge surge of foreclosures, many homeowners (sellers) in the pre-foreclosure stage needing to sell their homes or face financial ruin. This alone has created a growing supply of homes that are perfect for the find and assign transaction model. Buyers are abundant too. Many seasoned investors do not have the time to source properties, finding and assigning contracts is the conduit that connects buyers to sellers.
Quick Profits: You can easily earn $2,000 to as much as $10,000 in 30 days. Typical time into a transaction is about 6-10 hours.
No License Needed: You are not acting as real estate agent on anyone's behalf; you are merely locking in a purchase contract with the seller. You will need no special license is required.
If this sounds interesting to you why not learn to find and assign at your own pace? You can learn the specific techniques of finding and assigning real estate contracts in about a month.
Many do it part time.
Finding and assigning is achievable because it doesn't overwhelm the new investor with every real estate investing option available - there are specific, learnable techniques specific to these types of transactions.
Once learned, you have a powerful, targeted skill set that can easily generate continued cash flow every month.

Profile of a Professional Real Estate Investor

2007-11-07T18:44:00.016-08:00

A Professional Real Estate Investor is one who invests in real estate full-time, and earns their primary income from buying and selling property. They typically have a home-office, although some have set up an office outside of the home. The outside office is usually a property that the investor has bought.
Many Real Estate Investors are experts and specialize in a particular type of property and/or location. For instance some investors prefer to deal with single-family homes in good condition, located only on specific streets. Specialties give investors the advantage of knowing the market values of homes and what type of repair work is probably needed. This makes them able to quickly determine whether or not the deal would be profitable.
Other Real Estate Investors prefer "ugly" houses, the uglier the better. Ugly houses are sometimes abandoned and some are in what many consider to be undesirable areas of town. Some ugly properties have fire damage, vandalism, natural deterioration or a combination of all of these factors. The advantage of these properties is that they can be purchased at a very good price. And then they are rehabbed and sold for a substantial profit.
Other Investors prefer to only buy property in one particular area of a county or town. Often these purchasers are not overly concerned with the appearance of the property, rather they are only focused on buying, as an example a property for less than 60% of the fair market value (after repairs), without paying more than $175,000. These purchasers need to know the property values like the back of their and not mind the types of rehab needed, if the profit potential is attractive enough.
The point is that most Real Estate Investors have carved out a niche and are very adept at working these niches. Some prefer single-family homes, some prefer multi-family homes, some prefer mobile homes, some prefer condos, some prefer apartment buildings, some prefer commercial properties, and some will work with any type of property if the numbers make sense to them.
There are so many Real Estate Investment opportunities that no one person can have them all. Since most investors have their own niches and buying criteria, they are usually not chasing the exact same property as other Investors.
Professional Real Estate Investors often enjoy a very comfortable life style and actually chose real estate investing because of the flexibility it offers. They also enjoy the freedom of operating their own business and the tax advantages that go along with it. The bottom line is that many are able to spend more time with their family and enjoy the wealth that they create.
In contrast, many doctors and lawyers also earn considerable sums of money, but they often do not have the time, much less the flexibility, to enjoy the fruits of their labor.
Most people investing in Real Estate started out in another profession and stumbled upon real estate investing through a book, a TV commercial or word of mouth. They were amazed at the money-making opportunities that were available, and how easy it was to get started.
Many were able to work the business part-time and make considerable money in the process. It's not unheard of for a Real Estate Investor to earn as much on one transaction as they did in an entire year at their day job. And once you reach this point it is not difficult to decide when to quit your job and concentrate on Real Estate Investing full-time.
About the Author:
Chris Parks is a Real Estate Investor who has been involved in Real Estate in one capacity or another since the mid 1980s. As a member of a small group of Real Estate Investors and Entrepreneurs, Chris created Real Estate Investing for Newbies http://www.reifornewbies.com/ in order to teach and assist new Real Estate Investors in a step-by-step, easy-to-understand manner.

5 Tips To Sell Your Foreclosure Investment Faster

2007-11-07T18:44:00.015-08:00

Buying foreclosed property is one thing. Selling that same property is another thing altogether. Here are some tips that will help you turn that investment into cash.
Tip 1. Deal with small repairs. If a door hinge squeaks, lubricate it. Paint the walls and trim an attractive color. Replace vent covers if needed. Replace any torn screens or cracked windows. Make sure all bulbs are replaced and working in lighting fixtures. A bright presentation is cheerier and more inviting.
Tip 2. Do a thorough cleaning of the home. Check drapes; if they need cleaned, have them cleaned. If their condition is beyond cleaning, remove the them. Purchase inexpensive, but attractive blinds and put them up. Clean all carpets. Clean and buff hardwood and tile floors. Scrub any pet stains and use odor removers; call a professional for this task, if necessary. Brush out any trash and crumbs left in the cabinets. Make it shine. Make it smell good. A clean home will sell faster than one that isn't clean.
Tip 3. Make small improvements that will increase the value of your investment. Know which ones will bring the most value for the dollar. Kitchen improvements usually prove to be a good place to start. As an example, a good garbage disposal costs less than $150, but could increase the sales value of the home by several hundred dollars or more. Simple landscaping elements such as having pots of flowers decorating the front of the house or placing redwood mulch around trees or bushes make the outside look inviting and the house homier.
Tip 4. Plan ahead for when you want to sell. Spring and summer are usually the best time of the year for selling a home. Buyers want to be able to move during warm weather months and be in a home before the starting of the school year. Give them the opportunity to be settled in before summer's over.
Tip 5. Use incentives. Provide a home inspection as a part of the buyers package. Include appliances and air conditioners in the selling price. Use the offer of paying closing costs as a nudge for the buyer.
People still want the American dream, their own home. They also want to be treated well when making such an important purchase. Making your investment property look and smell like a home instead of just a house will bring you dividends when it's time to sell. Treating people with courtesy and respect will win you friends as well as buyers.
Joe Pahl

Top 5 Reasons Why You Should Invest In Miami Real Estate Properties

2007-11-07T18:44:00.014-08:00

The city of Miami has been one of America's pre-eminent cities, considered as the capital of the Americas. It is home to a huge number of multinational corporations, top-rated schools, high-quality infrastructure, and a vibrant economy.
South Florida as a whole is also considered a top-rated destination for overseas homebuyers and investors. As a financial and transport gateway between the US and Latin America, Miami, along with its closest neighbor Miami Beach, has long attracted a lot of international investment.
The Flow Of Foreign Funds Has Made The City A Good Place To Invest In The Property Market
In recent years, the entry of overseas money into Florida has flowed heavily become a gushing torrent, as investors awash with cash from economic growth in Latin America seek to capitalize on the city's soaring property values, according to market analysts.
South Florida is a popular destination for Europeans, as such, portfolio managers and institutional investors in many countries tend to see the Miami property market as a bargain even at current prices, whenever compared to skyrocketing property values in Europe, as the Euro has already gained strength over the Dollar. Foreign investments now account for a large chunk of property sales. This, according to data from the National Association of Realtors, now accounts for about 15 percent of all home sales in Florida, with the figure estimated to be much higher in Miami Beach.
Most of this money is poured into mixed-use developments that blend high-rise residential units with some office, retail, and hotel construction. Although some Florida-based financial organizations have slowed or temporarily reduced financing for new condominium and waterfont projects in Miami, larger national and international banks have remained active lenders in the south Florida housing market
The Condo Market Is Still Thriving
The condo-conversion wave may be ebbing, however soaring land costs and increasing numbers of urban residents will ensure that condos will continue to play a large role in the US housing markets, a South Florida developer predicted.
Current Mortgage Rates Have Dropped
At present, rates on 30-year mortgages fell for the fifth straight week as investors grew less worried about threat posed by inflation. Mortgage giant Freddie Mac recently noted that rates on 30-year, fixed-rate mortgages dropped to 6.15 percent this week. That was down from 6.21 percent last week and was the lowest level for a 30-year mortgage since late October.
Interest rates for long-term mortgages slipped lower this week due to some economic data releases that leaned towards a more subdued inflation in the near term, according to the agency's chief economist.
Florida Home-Sales Median Prices Have Risen
According to the Florida Association of Realtors (FAR), home sales statistics have shown that home prices continued to rise but the number of sales fell in October, particularly in areas directly hit by Hurricane Wilma's drive across the state. Many insurers stopped issuing new policies when the hurricane neared Florida, and, in the aftermath, some lenders required a re-inspection of properties before they would release mortgage money.
Pre-Existing Home Sales Are Above Other Areas
Pre-existing home sales in Miami, Miami Beach and Fort Lauderdale have shown to be a sound investment, and have outperformed since 2000 the S&P 500, a broad index of U.S. stocks. Miami housing prices are outpacing the top 20 regional centers and the nation as a whole, based on data from the National Association of Realtors.
http://miami-realestate.net/ - Miami Real Estate

Subject To The Absolute Best Way To Purchase Real Estate Investments

2007-11-07T18:44:00.013-08:00

Aren't you always curious about what these late night real estate gurus are talking about when they mention "Zero Down" investments properties? Haven't you wondered about how the heck you can buy investments with no credit? If so, read on.
We're going to dive into a topic that's very dear to my heart, the art of taking over payments. It's the absolute best way to purchase homes, and it's what has allowed me to amass a very large number of properties.
The official name for this method of acquiring homes is called "subject-to". That's because you buy the property subject to the existing financing the seller already qualified for. Many investors struggle trying to get sellers to go along with this. But once you get the first one under your belt, your comfort level increases dramatically, and the next ones come with ease. When you buy a home like this, you are responsible for the payments on the loan. The seller will deed the property over to you, so you'll officially own the home,but the mortgage will stay in the seller's name.
It's important that you explain to the seller that the loan will remain intact until you find a buyer. You should NEVER give a time limit on how long the loan will stay with the seller. For example, some investors who are so hungry to find a deal will tell the seller that he promises to find a buyer to pay off the loan within a few years. This is a very bad strategy because you really can't predict what the selling climate will be down the line. If you don't get the home sold, you'll now have a seller who's ticked off at you because you couldn't live up to your word.
You'll want to make sure you use the correct paperwork to transfer the title from the seller to you. When you do business with Amazing Atlanta Investments, we provide this to you FREE of charge. Not having the correct documents can land you in big trouble down the line.
A couple of things I want to mention now. If you say you are going to make the payments, then you must do exactly what you say you'll do. The sellers are entrusting their credit to us. To ruin their credit intentionally or unintentionally would be down right unethical. Although it rarely happens, you should explain to sellers that there is a chance the lenders may call the balance on the loan due if they see the property has switched hands. This is because of a "due on sale" clause that lenders have in their agreement with the seller. The experience I've had is that lenders really don't care where the payments are coming from as long as they're collecting their interest every month. Also, because of the high number of foreclosures, lenders are doing as much as they can to keep as many performing notes as possible in their portfolios. Nonetheless, the sellers should still be aware the possibility exists for the loan to be called.
Those are basics of subject-to. Feel free to browse through live available subject-to properties at http://www.amazingatlantainvestments.com/
Good luck, and remember from this day on, never get a loan on an investment property unless you absolutely have to.
I'm Jacob Okunoren, and I'm been investing in real estate since 2005. I did this while trying to find an exit from my corporate job. Once I began researching investment properties, I became obsessed with it. Every weekend I was at bookstores soaking up as much information as I could. I began spending every penny I had on training, seminars, and coaching. I became so intrigued with investment properties, I packed up my things, moved out my recently purchased home, rented it out, and moved back in with momma just so I could be able to spend more money on acquiring knowledge on real estate. Family and friends thought I had lost my mind. But all this knowledge was useless because at the end of the day, I still hadn't purchased any investments properties. So in April of 2005, I did away with my fears and bought my first investment property. In fact, I bought 4 that month and haven't stopped since!
I now wholesale wonderful Atlanta properties to the public for them to share the same success I've had. You can see this at http://www.amazingatlantainvestments.com/

Real Estate Investing in a "Buyer's Market"

2007-11-07T18:44:00.012-08:00

Real Estate Investing has probably made more millionaires than any other industry. Real Estate Investing also offers many rewards including cash flow, security, long-term wealth and numerous tax benefits.
Real Estate Investing is something that anyone can learn and prosper at regardless of age, gender, religion, race, education or current occupation. You can begin with virtually no start up costs, and work this business from your home full-time or part-time.
Real estate Investing is one of the very few occupations left where the little guy can start with nothing and still strike it rich!
There are no licenses required to invest in Real Estate, in fact you may have already done so by purchasing a home! Real estate offers a practically unending supply of properties. There are millions of properties on the market, and thousands more become available each day, all over the country.
The Real estate Investing market goes through cycles just like any other industry. And, even when the market is "down" there are still many outstanding opportunities.
In most areas of the US we are currently seeing what is often referred to as a "buyer's market cycle". Simply said there are more homes for sale than there are people to purchase them. A record number of homes are for sale and they are taking longer than ever to sell.
This downside in the real estate market is not all bad. On the contrary, it is actually quite good IF you are a real estate investor looking to buy.
As a Real Estate Investor you currently have choices like never seen before. Some Real Estate Investors are able to purchase properties for less than some current owners originally paid and many Real Estate Investors are purchasing more properties at this time. Also, Real Estate Investors are able to spend even less money on homes that need some type of renovation.
Quite simply there will always be a market for Real Estate Investing; regardless of the economy people will always need a place to live. And owning a home is still the American dream.
About the Author:
Chris Parks is a Real Estate Investor who has been involved in Real Estate in one capacity or another since the mid 1980s. As a member of a small group of Real Estate Investors and Entrepreneurs, and always having the knack for explaining Real Estate Basics in an easy to understand manner, Chris created Real Estate Investing for Newbies http://www.reifornewbies.com/ in order to teach and assist new Real Estate Investors in a step-by-step, easy-to-understand manner.

Top Four Reasons to Refinance Investment Property

2007-11-07T18:44:00.011-08:00

If you own a successful investment property, you may be sitting pretty. But you also may be sitting on an untapped gold mine. By refinancing, you have the potential to either build your wealth, or boost your cash flow.
Refinancing an investment property is a lot like refinancing your own home: When you tap your equity, you can pursue a variety of financial options. A popular choice for investment property owners is to use the funds to buy another property. But there are quite a few alternatives that underscore how property can create prosperity.
1. Expand your empire. Leveraging a current investment property to acquire rentals and other property investments is a favorite tactic among land barons. If you haven't touched your property's equity in years, the time may be right for you to do so now. The recent housing slump has led to a rise in renters. This could be an ideal time to get that cash-out refinance and add to your property portfolio.
2. Raise the rent. Another favorite tactic of property owners is to take money from a cash-out refinance and upgrade current rental units. A new bathroom here, or a new kitchen there, can instantly improve the market value for a property, and allow for higher rents.
The key is to be pragmatic in your remodeling efforts. Choose economical fixtures with good aesthetic appeal. A renter will be focused on the appearance of your property, and anything that looks good, even if it's relatively inexpensive, can add substantial value. New carpets and nicer light fixtures pay dividends in the long run.
3. Cash-in on your investment. There's no written rule saying that the money you've made on your property needs to be reinvested in more property. There are plenty of important things that are calling for you funds, such as your child's college education, or a great equity investment in the stock market. You can even use the loan to consolidate debt or take a vacation. There are a number of ways to make your money tree grow; just be sure to do your homework before you plant seeds for that tree.
4. Say "go" to more cash flow. If you're simply looking to boost your cash flow, a rate and term refinance of your current investment property could free up money on a monthly basis. Look up the rate on the current mortgage of your property. Despite the interest rate climbs of the past few years, overall mortgage rates are still excellent. You may be ready to shave some serious dollars off your monthly payments.
A mortgage refinance is a smart way to use short-term debt to increase long-term wealth. Check current mortgage rates on the market and carefully analyze your situation. The time may be right for you to build on your investment with the help of a mortgage refinance.
Find other refinancing reasons and details at...

House Flipping - Forming A Team For Flipping Success

2007-11-07T18:44:00.010-08:00

First, you need to be sure to form a team for your company.
In order to make a huge real estate flipping company you need to formulate a team. When I was looking into flipping a property I wanted do everything myself, and I found out real fast that I did not have the money nor the experience to be successful in this industry. So, I having a background in construction partnered up with my brother who work's for a nationwide Real Estate company in the REO department and handles contracts all day, decided to work together on a flip. So, we develop our corporation with the help of a investor, and we were ready to go. Everything, works so much better with a team, a flip that would have took a single person months to do only takes us weeks.
Second, have contractors or handymen do the work. As a flipper you need to be out finding deals and working at getting the property sold. Hire out the labor portion of the job. This was the hardest lesson for me to learn. The first flip I work on took over 3 months because we did all the work our selves. After that, the lesson had been learned and we hired out all the labor on the second flip and everything was finished and we had a open house within 3 weeks.
Flipping is more profitable when you have a great team:
Third, have an awesome realtor. Realtors are a dime a dozen, but you need to look for the diamond in the rough. The hard worker that wants to get your property sold, not just stick it on the MLS and wait for a call. A good realtor is constantly staying on top over everything that relates to your house flip getting sold. Also, a good realtor will let you know if you are going to pay to much for a house, or if you are asking to much for the property you are trying to sell. I do not recommend trying to do a FSBO because you have no coverage. I do things to help with the sell of the house above the realtor, but I still depend on the realtor as the main source of getting my houses sold.
If you can put together a team that works for you I believe you will be more profitable and less stressed in the long run
By: Chad Wiley

How To Buy A Great House For Pennies On The Dollar

2007-11-07T18:44:00.009-08:00

Real Estate Investing
From a historical perspective, investing in real estate is almost as old as the construction of property itself. Over the last two weeks, events have unfolded that have reminded me of an important truism in real estate investing. Whether you are brand new to real estate investing or an expert in the game, it’s critical that you understand these 7 Simple Steps to real estate investing.
You must become an expert in all areas of real estate investing and understand such terms as lease options, cash sales, wrap mortgages, short sales and other terminology common in the real estate investing trade. One of the most common scenarios that I see among the new and inexperienced, who have gotten themselves into big trouble with real estate investing, is jumping into a deal that they don’t understand, in hopes of earning a chunk of money quickly so that they can pay off existing personal debts. One of the biggest challenges to overcome is the fact that, when discussing the money made through Real Estate Investing, the numbers of dollars are much more than your common corporate job, and many people simply are not ready to handle such discussions.
It is a fact that over the long term, investing in real estate is a great way to pay down debts, build income and secure your future. If you buy right and plan well. All of this leads us to the fifth reason why you should be investing in commercial real estate and that is the passive income.
Not everybody IS getting rich with real estate investing, no matter what the hype leads you to believe. Many beginners are lured into real estate investing by the promise of quick, easy money, but it's NOT a get rich quick field. For instance, if you believe, based on your extensive research and knowledge of your area's real estate market, that you can make $10,000-$50,000 on a fixer-upper, don't be surprised if you have to settle for half that amount in order to get the quick turnaround you'll need to make quick profits.
In 2005, some beginning investors lost their hard-earned investment capital or only made a meager profit because they failed to do their homework on the out of state area's real estate market and customs. However, returning to the initial question about whether real estate investing is still a viable option when current prices seem to be nearing their peak: yes, it can still be so, but you might need to be more creative and prepare to be in for the long haul.
To help you to decide whether or not real estate investment is right for you, here is some additional information on investing in real estate for both resale purposes and rental purposes, as well as some of the advantages and disadvantages of this type of investment. One common method of investing in real estate is investing for the purposes of resale. Continue to follow your real estate investing "game plan" and always keep an eye out for the hidden investment opportunities.
So when determining to invest in real estate, always know the reason to why you are investing, when you have this reason in mind, you will always look at the investment with a purpose. The best reason for investing in real estate is that it actually works! Real estate investing proves that the American dream is still very much alive. What other avenue can an individual begin in virtually any circumstance in life and build an empire of wealth in a relatively short period of time?
Richard Davis Waterhouse

Diversify Your Retirement Plan With Real Estate

2007-11-07T18:44:00.008-08:00

n 1945, just ten years after the Social Security Act was passed, 42 gainfully employed Americans were supporting one person drawing Social Security Income. Today, three Americans support one person drawing Social Security Income. With more than 75 milliion Americans who will apply for Social Security benefits in the next 18 years, we all must consider a very difficult question: Can I really afford to retire? This naturally will lead us to a second question: How can I put myself in the best position to retire?
Speaking of retirement and the Social Security Administration, I am sure that everyone that reads this article is aware that 89% of all retirement income is derived from the Social security Administration, and that even with all of that help, the average American retires on less than $1250 per month or $13,500 per year. Americans are now faced with a new reality: We must become Millionaires by the time we plan to retire. The reasoning for this is very simply. One of the first things that a sound Financial planner will tell you to do, when you retire, is to put your money into any number of secured accounts that will allow you to earn a guaranteed rate of interest and not deplete your principal. Assuming that we could earn a guaranteed 4% interest on our money, we would need $2 million at the point of retirement to earn $80,000 gross and $60,000 after taxes to give us $5,000 of spendable income each month. Studies suggest that the average American will need around $12,000 per month by 2020.
There are several factors to consider as we face retirement:• How long will we live after we retire?• How much money will we need to satisfy additional medical expenses?• How will inflation affect our retirement savings?
In a 2005 interview for Newsweek, Charles Schwaab indicated that over a ten year average, monies invested in the stock market would earn an average of nearly 8-10% annually. This, at surface value, appears to be great news, but if we consider Einstein's Rule of 72, we realize that our retirement savings, if invested in the stock market, will double on average every 7 to 9 years. This will leave the great majority of Americans woefully short of their retirement goals. And let us not forget that 2007 has been an unequivocal reminder that the stock market is incredibly unpredictable and unstable. This year has shown us the highest growth in the Dow Jones Industrial Average and also the six largest decreases in value of the same. Perhaps we should consider if the one account that we are absolutely counting on to be there when we retire should be tied to the stock market.
What then is the safest vehicle we can use to fun our retirement accounts? The answer may be found in what Millionaires have been doing for decades. Consider that today 86% of all Millionaires in the United States have made their fortunes buying and selling Real Estate. Despite the current trends we have seen in the last two years in the residential real estate market, those individuals who have made their fortunes in real estate continue to do so. We all know that over time, real estate will strongly outpace the stock market, but the unfortunate reality is that only 4% of Americans know how to fund their retirement plans with real estate. The IRS, by means of Internal Revenue Code 408 allow individuals to fund their retirement plans with real estate subject to a few provisions.
It isn't good enough though to purchase just any piece of real estate with your retirement plan. We must be much more strategic in our selection of what we buyBob Hope is well known for his Role in numerous movies, and for all the charity work that he did in conjunction with the Armed Services, but slightly well less know is how he created his impressive wealth. In the early 60's and 70's Bob Hope was actively involved in a practice known as "Land Banking". Land Banking is a concept that has been used by just about every big name in Real Estate from Donald Trump to John Jacob Aster, and virtually everyone inbetween. It operates off the simple principle that as metropolitan areas as they expand create a substantial increase in the value of the properties that surround them, and thus create substantial wealth for the individuals that own those pieces of property.
James McGary has helped thousands of families prepare for retirement as and Insurance Agent and Securities Broker over the past 14 years. He is currently the Sales Director for Ace Capital Group headquartered in Redwood City, California. He welcomes any questions or comments at jmcgary@acecapgroup.com

No Money Down Real Estate! Making Money With Subject-To Deals

2007-11-07T18:44:00.007-08:00

The subject-to is one the most sought after real estate techniques being used today. With this system, it's all about control!
When you take a property subject-to, it means that you agree to buy the property, subject-to the existing mortgage. In other words, the mortgage remains in the seller's name. But, the deed belongs to you. I know you're probably scratching your head right now, but that's no typo. You own the house legally but the seller is still legally responsible for paying the mortgage.
In traditional transactions, when you buy a home from someone, the deed and the mortgage are transferred to you in your name. But this method is used primarily with investment property, more specifically on deals where the homeowner is facing foreclosure or simply wants out of the property. This is when you would want to just step in and take over the property. By doing a deal this way, you eliminate the need for getting a new mortgage and also by mitigating or minimizing your liability.
I have done several subject-to deals over the years and it's a great way to accumulate a portfolio of rental properties for income. The scenario goes like this; a seller contacts me with a property that is either vacant or occupied by bad tenants. He is fed up making payments or can't make the payments anymore; in some cases he is already behind a couple payments and is going to be facing foreclosure soon.
Once I analyze the property's rental potential and accessed the necessary repairs. Then I've decided that it makes financial sense, I proceed with writing up the documents. After I have signed documents in my hands, I evict tenants if I have to, make repairs and immediately start looking for a lease option candidate or rental tenant depending on the type of property it is. After I have my tenant or buyer, let them make all of my monthly payments on the property until I either sell it or refinance it.
The best part about doing subject-to deals is that you'll be able to just step into the shoes of the owner without any money down and with very little liability. You can do what ever you want to do with the property, because for all intensive purposes, it's yours!
WARNING!
There are several required documents that need to be signed by the seller. Without these documents you could open yourself up to laws suits or lose control of the property.

Cash Flow In San Diego

2007-11-07T18:44:00.006-08:00

Who says you cannot CASH FLOW in San Diego?
Well, I am here to tell you that you can!
Here is the deal. The city of Oceanside has many low priced properties; yet, the rental rates are still quite high. This is due to the strong military presence, and due to the fact that Oceanside is a coastal community. All in all, there is a huge rental market in Oceanside; and as an investor, this means cash flow.
For example, my business partner and I went to one of these houses the other day and spoke with the owner. The owner loves his house, and does not want to move away; however, with his loan coming to term. With $500 increase in his mortgage, he will be unable to make his mortgage payments and at the same time, provide for his family. When I asked him if he would be willing to stay in his house and rent it for $2100 a month, he said "yes"!
Let's do the math.
Purchase Price $265,000Percent Down 10% or $26,500Interest Rate 6.25% interest rate for 1st mortgage or $1,305 a month
8.25% interest rate for the 2nd of 10% of the purchase price or $199Property Tax $265Insurance $55TOTAL Roughly $1800.00
Using the above stats, if you place as little as 10 percent down, you will have a positive cash flow of $300. Now, if you place 20% down, your new investment property will have positive cash flow of approximately $475.00. Not only do you cash flow monthly, but the previous owners bought this particular house for $450,000.00 just 2 years ago. If you do buy this property, rent it, keep it until the market changes, and sell it for a huge profit!
As Rich Dad said to Robert Kiyosaki, if you could buy a house and lose $100 a month how many could you purchase? The obvious answer is not that many. Yet, if you could buy a house and make $100 a month, you could, in essence, purchase an infinite amount.
Today's market is unbelievable! It is definitely time for the savvy investor to purchase -with historically low interest rates, low priced homes, high rents, and a knowledgeable Broker/Investor on your side.
If you have any questions, please do not hesitate to call me at 858-34-HOUSE. In addition, I would love to share with you many creative strategies in which you can purchase a home for little to no money down regardless of your credit score (i.e. seller back financing).
Danyel Brooks is a California licensed Real Estate Broker who works primarily with Investors. As an investor herself, Danyel has the creative mind to make the most profit out of a deal. She continues to ask herself, "What is the highest and best use?"
Article Source: http://EzineArticles.com/?expert=Danyel_Brooks

How To Start Flipping Houses For Cash!

2007-11-07T18:44:00.005-08:00

One of the trendiest real estate investing techniques around today is called "flipping or wholesaling real estate". This technique is so popular because it requires no real investment money, no credit requirements and pretty much, no real estate investing experience. It's the age-old process of buying something at wholesale cost and selling it retail, but with a slight twist, you actually sell the product without ever owning it. Once you complete the sale the investor can walk away from the closing table with anywhere from 10 to 50 thousand dollars on average.
By now I'm sure you can see why this method might be so well liked especially among beginning real estate investors. There are several so-called real estate gurus out there selling books, cd's and tapes on the subject for hundreds of dollars but this is one the easiest investing techniques to do.
Let's explore what flipping houses entails.
An investor locates an under valued house, preferably a property that needs only cosmetic repairs or what we like to call a "sugar coat deal". This means a house that will only need paint, carpet windows or some other very minor repairs, definitely no structural issues or roof replacement deals. You really want a house that has been neglected a bit, one that the seller hasn't kept up very well. These types of properties can be spotted very easily because they stick out like a sore thumb in a well-kept neighborhood. The paint's peeling, the grass is uncut, it needs replacement windows, etc.
Plus you will make the most profit from finding the worst house in the best neighborhood, if that makes since. You want to do this because when it comes time to sell, you want to be able to get the highest value, make your profit, while leaving some equity on the table for the homebuyer.
Once you've found this type of property, then you need to put it under contract and lock up the deal. There's a couple of ways this can be done.
1. You can put an option on it.
(What's an option?)
A unilateral agreement binding the seller to selling a property to you exclusively, for a predetermined price, but at a later date sometime in the future.
2. Have the seller sign a purchase agreement that gives you say, 90 days to close. This is called a buyer favorable purchase agreement. It is designed to help you, the buyer.
3. Land contract or contract for deed.
(What's a land contact?)
A contract used in a sale of real property whereby title to the property remains vested in the seller until the buyer who receives the right to possession has paid in installments over a long period of time a preset amount or all of the purchase price and upon default by the buyer all payments may be forfeited. Also known as a Conditional sales contract, an Installment sales contract and a Real property sales contract. There's a few other ways to lock up a deal also, just make sure you don't spend any money until you have the deal secured but let's move on.
When you have secured the deal, then you start making the necessary repairs to bring the property back up to the neighborhood standard. That's when I like to start looking for a buyer, while I'm actually making the repairs, just to get a head start. This makes the transaction go a little smoother.
Now remember, when you bought the house, you paid a discounted price because the home needed repairs. But now you've the repairs and the home can be sold on the retail market to a retail buyer. This is where you make your profit!
I am a seasoned real estate investor and licensed realtor, with years of experience transacting real estate deals, commercial and residential.
For more free tips and step-by-step instruction on real estate investing techniques visit: http://www.Realestate-Ninja.com

Rental Buying Tips

2007-11-07T18:44:00.004-08:00

Buying an Investment Property - Tips to Make Your Offer More AttractiveBy Katherine Guilford
In a hot market, the real estate investor faces competition from other buyers for the most desirable properties and the best deals. It's part of the real estate game: you win some and you lose some. But if you really want your offer on a property to be accepted, there are ways to give yourself a little advantage over the competition. Here are some tips for making your offer more attractive and more likely to be accepted.
Offer full price
When you locate a property that is significantly underpriced (based on its present value in the market), offer the seller the full amount they are asking, especially if there are other buyers putting in offers. Don't get carried away and start haggling for a better price - you risk losing a good deal to a more level-headed buyer. In fact, it could be worthwhile to offer a slightly higher figure than the asking price, say, $1000 more. This is a little trick that wouldn't occur to many home buyers. Trumping any offers for full price makes you look very attractive and gives the seller an easy way to decide which offer to accept. Negotiating with several prospective buyers is a stressful and time-consuming process for the ordinary homeowner. Normally the seller simply wants to take the highest acceptable offer and close the deal as quickly as possible.
Take the property as is
If you've had a good look at a house and are reasonably sure that there are no major problems, agree to take the property "as is." Place a stipulation in the contract that says you will not ask the seller to make any repairs or pay any fix-up expenses. This gets rid of one common worry that sellers have - being required to spend more money on the property just to finalize the sale. Of course, you still have to protect yourself. Do this by including another clause in the contract. It will say that you have the right to inspect the property within a specific period of time (3-5 days). If the inspection is unsatisfactory you are then entitled to withdraw the offer and get a refund of your deposit. To make your offer even more appealing, you can agree to forfeit the deposit if you cancel the contract. But only do this if you're very confident that the house is a great buy.
Avoid delays
When other buyers are making offers on the same property, don't do anything that will weaken your offer or cause it to be delayed. For example, use the standard contract forms understood and used by Realtors in your state for all your offers. You might have obtained non-standard contracts through a seminar or course, but avoid them. Any offer that is not on a standard contract form will probably get an unenthusiastic reception from the Realtor or seller. There may be delays while the contract is studied and you may be asked to rewrite the offer. In the meantime, another buyer can jump ahead of you with his own problem-free contract.
Make the seller's life easier
Many home sellers dread the moving out process because it is so much work. Find a way to make the job less troublesome for the seller and include it as part of your contract. For example, you could add a clause stating the seller doesn't need to clean the house before you take possession. Is the seller worried about the piles of junk accumulated over the years? Solve the problem by offering to remove any unwanted items from the house yourself, after closing. Little extras like these will make your offer stand out from the crowd.

Rental Properties

2007-11-07T18:44:00.003-08:00

Are You Really Ready To Buy Rental Properties?By Raynor James
Watch the various television shows and infomercials and it can seem like investing in rental properties is the way to go to make a certified fortune. Rental properties can be lucrative, but there are definite downsides.
Most people have a particular view of rental properties. They buy a property, stick a renter in it that covers the financial nut of the owner and then sit back and collect money in the form of rent. As the property appreciates over time and the mortgage is knocked down, the property grows in value. Ah, wealth building! This rosy picture, however, leaves out some stark realities.
There can be a host of problems when you rent a property. The first problem is finding a renter that is mature and responsible. The endless stories of renters trashing properties can put any Halloween Story to shame. Throw in tenants that don't pay on time or have to be physically evicted and you can see how renters quickly can be an issue.
The next issue that can arise is the quality of the property. Simply put, you have to maintain certain standards. If you are living in the property, you might let things like a dripping sink remain unfixed for a few weeks. In rental properties, you have to get them fixed quickly. If the toilet tank explodes in the middle of the night, the tenant is going to call you. This leads us to our next issue.
Repairs can be simple or repairs can be costly. Regardless of how it goes with a particular problem in the property, you are responsible for it. If the problem is fixing a small sink leak, the cost is negligible. If the problem is something more costly such as a mold issue, you can run into a cash flow problem.
One obvious solution many investors use is a management company. The company takes care of late night calls and so forth. This can help you get some sleep, but you are still ultimately responsible for paying for the repairs. That might be a bit more difficult given the fact you now must also pay the rental company.
So, should you invest in rental properties or not? Only you know your temperament. Evaluate the benefits and negatives and make your choice with your eyes wide open.

Short Sale

2007-11-07T18:44:00.002-08:00

Short Sales in Real Estate InvestingBy Bill Vaughn
There are some "infomercial gurus" that say they will teach you how to make a fortune in real estate by using the so-called "short sale" method. And they tell you it is an easy way to make a lot of money. But is that just a lot of hype, or is it factual? Just what is the truth?
To answer this, one must look at all the facts, not just the ones in the late-night spiels. One thing is certain, however - a short sale almost always does great harm to the seller.
A short sale will usually put the seller - already in financial trouble - in deeper trouble. The IRS code states that any discounted amount must be treated as income by the seller. For example, if the seller's mortgage gets discounted by $30,000, the seller will now owe the IRS the full tax on that $30,000, even though he has not received a dime! In most cases, this further debt will force the seller into insolvency from which he may never recover. There are those who would counter that in certain cases, courts have found that the IRS cannot claim taxes in this fashion. But the fact remains that it is in the IRS code, which is backed up by law passed by Congress. The IRS can - and usually will - enforce collection.
Also, in many cases, the lender may still opt to go after the seller for the remainder of the mortgage (the discounted part), called a deficiency. So, the seller no longer has his home, but still owes a large sum to the bank on a property he no longer has, and also owes a large sum to the IRS that he probably cannot pay. Frankly, no investor worthy of the name would ever do this to a fellow human being.
For this reason, I do not teach this method of investing - it is unnecessary to cause such harm. Good profit can be made without it, and with methods that are simpler.
Some important facts about short sales: A "short sale" occurs when a lender "discounts" the balance due on a homeowner's mortgage if he is in financial trouble, if they so choose. The purpose, of course, is so the homeowner can find a buyer quickly, before foreclosure becomes necessary. Foreclosure is an expensive and time-consuming process that some lenders may want to avoid. But in most instances, lenders would rather foreclose, and then sell at nearly market value. Why take a discount if they can get full value? So, in most cases, a short sale is simply not going to happen.
But even in those cases where a lender may consider a short sale, the process is complicated and time-consuming, with an inordinate amount of paperwork. In other words, it is generally not worth the effort, when there are simpler methods of accomplishing the same thing, and without doing harm to the seller.
The paperwork involved is much more complex than in an ordinary transaction (see below), so one should wonder why anyone would bother? The fact is, most seasoned investors would not. It is the "infomercial gurus" who make money teaching this method that are responsible for the upsurge in attempts at short sales. Those gurus take advantage of naive, unsuspecting novices, and then those novices, armed with this method, will go out and try to apply it - and do substantial harm.
If still interested in using this questionable method, note that the lender will want documentation that includes a letter of authorization (lender's will not provide personal info about the seller or his mortgage without it); a preliminary net sheet (estimated closing statement that includes the proposed sale price, costs of the sale, unpaid loan balances, outstanding payments and late fees, and real estate commissions, if any); a hardship letter (statement of facts that show it is impossible for the homeowner to redeem himself and pay his debt, through no fault of his own); proof of income and assets (of both the homeowner and the investor/buyer); copies of bank statements (of both seller and buyer); a comparative market analysis showing the actual value of the property; and the purchase agreement from the buyer. See what we mean when we say this method is just too much trouble?
You may want to note that any property that has a second mortgage will probably not qualify for a short sale. This is because it is virtually impossible to get a second lender to remove its lien, thereby taking the risk of losing its investment.
So, now you know the truth about short sales. And you can probably determine that they are more trouble than they are worth, and will have terrible consequences for a seller who already has his share of trouble.
I have been teaching new investors for over 18 years, and I only teach ethical methods of investing. If you follow that example, not only will you be acting honorably, but you will not cause harm to anyone while you profit immensely, and earn yourself a solid reputation as a good person to do business with.