If that sounds intriguing to you, read on. The Mike Watson Institute (MWI) offers a fresh approach to real estate investing using the license, skills, and talents you already possess as an agent. And don’t think this is just another get-rich-quick scheme because there will definitely be some time and hard work involved on your part to make this a successful venture.

Recently, I had the pleasure to go through the CDs and workbook from a Super Camp event held in Phoenix by the Mike Watson Institute. This program is packed full of all kinds of relevant information about real estate investing as well as some very creative concepts and several live student presentations.The “Retire in 5 Years!” Home Study Course includes 16 audio discs plus a workbook of informational slides and some notes on the student presentations.

Two of the most interesting concepts promoted by the Mike Watson Institute are that it is…

• geared toward the real estate agent who wants to become his or her own best client and it

• promotes a viewpoint of looking at properties in a different light in order to earn profits by seeking out the property’s highest and best use, not just to improve it from where it is now - as is common in many “fix and flip” or other investing programs.

The program begins with Mike’s presentation on retirement. His definition is slightly different than you might expect. To him, it’s not just about stopping all work and going on social security or other retirement income. His definition focuses more on finding out what is important to you now and how you envision your future – and the key to getting there is to have the earning power and free time to accomplish all your goals. In other words, you may still need to work to accomplish those goals, but the focus changes to your ability to pay for your life now and also create continued income to pay for the rest of your life.

Notable concepts regarding the investment process presented throughout the program include:

• Deal Evaluation – learn some basics of the system and new ways to find, evaluate, and profit on the best real estate deals in your area

• Area of Expertise – it’s recommended that you establish a small area of your city that you’ll focus on (one to four square miles); you should avoid CC&Rs and other restrictions that could affect your profits; and find ways to make your area better in the process while earning profits

• Power Teams – this is probably one of the most important aspects of having a successful investment business according to MWI; people from different professions such as escrow officers, lenders, contractors, and more help you find deals and work with you to raise capital and earn tremendous profits; it is SO important that Mike emphasizes that every seasoned student who currently has a properly functioning power team is a multi-millionaire

• Seller Financing – this is where you can get super creative and that doesn’t mean it’s illegal; creative financing solutions can exist whether or not the seller owns the property free & clear; and these arrangements can have benefits for both the buyer and the seller

• Creating & Enhancing Equity – the goal of every deal is to create & enhance equity both during the escrow period and after ownership; tools for doing this through escrow can include cash purchases, short sales, seller/lender paid closing costs, etc.; tools for doing this through ownership can include zoning changes, government incentives, remodeling, decreasing expenses, condo conversions, etc.

• Flips, Fixer-Uppers, and Flixers – these sections discuss how to buy for the lowest amount possible, make changes or give the appearance of changes, and sell for a profit; this is not just your average fix and flip advice as there are many creative approaches to create value here

The program is packed with student presentations and real-life success stories. One, in particular, caught my attention probably because she is a mom like me trying to balance the workload of raising her children and earning some income to better her family’s life:

Jennifer Hawkins started with MWI in September 2006 and has since increased her net worth by $350K. She has made offers on properties anywhere from $100K to $8 million. She currently has a 14-person Power Team who send her non-compete deals – this means that there are 14 people out there who are finding deals and giving her the exclusive rights to earn profits! This certainly shows the benefits of how people can work together and help both you and each other retire in 5 years.

Jennifer shared the details of some actual deals she has recently worked on. For example, she bought a run-down duplex for $260K, remodeled the first unit, and converted it to a condo. She sold just the one condo for $175K. During the remodel, she was also able to use a contractor from her Power Team to do the work thereby reducing her costs significantly; the contractor was willing to do this because of the other benefits and profit-sharing that he receives by being a part of her team. Another great benefit from this deal was that in her city, she did not have to go through a government process for the conversion – this was a great find for her and increased her profits. This example proves that if you educate yourself on little-known government regulations and incentives, profits can be had for essentially doing nothing.

What I enjoyed most about this MWI program was that the information presented is not just hype; there are practical solutions to investing scenarios and real-life experiences from actual students. In addition, by joining the MWI program, you have access to the forum and ways to network with other students. You can see what is working for other students and gain access to helpful questionnaires, forms, and systems used by other successful investors.

For more information on the Mike Watson Institute of real estate investing, visit http://www.mikewatsoninvesting.com/.

“Today’s action in the Senate was a great team effort,” said NAR Senior Vice-President of Government Affairs Jerry Giovaniello. “REALTORS across the country, state and local association staff and our NAR staff in Washington, DC joined forces to achieve this victory.”

He left armed with a couple gallons of water (hey, it’s HOT in Phoenix), a Budweiser, a chair, a Sudoku book (he’s addicted), and of course, the American Express - those phones aren’t cheap!

He spent an hour at home trying to decide which chair to take with him. The photo below details this tough decision — do you choose for comfort, convenience, or necessity?

Y’all have to wait until later to find out which one he chose…

IF he is lucky enough to get an iPhone, we will have a detailed review complete with photos by the end of this weekend for all you Famous Agents out there.

Jordin Sparks is a talented and classy young woman - who just so happens to be the daughter of Jodi Sparks, a Keller Williams agent in our very own office in Glendale, Arizona. Jim and I had the pleasure of meeting Jordin and we can tell you first-hand that she is a fun, bubbly young lady with a heart for God. She is humble and sweet. And - wow - can she sing!

We’d like to call on all FamousAgents.com members to watch the American Idol show Tuesday night, May 22nd at 7pm CST. And please… dial ’til your fingers burn. Vote for our gal, Jordin Sparks!

P.S. For you praying folks out there, I’m sure she’d appreciate your prayers as well.

Yesterday Reuters ran an article with the headline “Web Lenders Woo Subprime Borrowers Despite Crisis.” It starts,

“Get a “$200,000 mortgage for $667 a month!” a banner advertisement on a lending Web site proclaims. “Bad credit OK!”

The mortgage loan advertised is a negatively amortizing ARM with an initial rate of 1.25%, fixed for only 30 days. According to the article, the rate then adjusts to MTA plus 3.25%, giving it an actual current rate of 8.28%. Crunching the numbers, one can see that if the borrower were to continue to make the $667 minimum payment advertised, the loan balance would grow $708 per month in the first year, assuming the MTA index remains flat.

I am glad to see the mainstream media calling out this type of advertising. It seems irresponsible in our current market to advertise negatively amortizing loans, particularly to those with bad credit. While loans like these may fit a specific purpose for the sophisticated buyer, they certainly should not be used to low-ball a payment to get a client in the door. The abuse of these loans has contributed to the problems our industry is facing today.

Now more than ever, you should be encouraging your clients to work with a professional lender you trust. The lender should be providing a mortgage strategy to help your clients achieve their long and short-term financial objectives. For most people, a mortgage loan is the largest debt they will ever have. It deserves to be managed as such. If you do not know where to start, follow this link for a list of questions you can use to screen a potential lender.

We all know the dangers of buying in brand new communities. In the Hilton Head area market alone there have been 60+ new developments started since I moved here 11 years ago with many more to come. Builders are offering all kinds of incentives to get buyers signed up, especially at the end of the month when sales goals have to be met.

The salespeople in these developments have only one job, and that is to sell the property where they work. Let your Buyers know that the onsite sales reps only represent the Developer’s interests, whereas you are there to represent their best interests.

Some clients may think they will get a better price or better incentives if they don’t use an agent; be sure your clients understand that the price they pay will be the same whether they have your representation or not. Developers may offer incentives, but they don’t discount prices because it can negatively affect appraisals when they go to sell future homes.

It helps to have a list of questions ready to ask of each developer. Many of these questions your buyer would never think to ask and you bringing them up gives you instant credibility and makes you a valuable ally in any transaction. Some questions may seem like common sense but they are ultimately important to the whole picture.

Here are some sample questions to ask a Developer:

• How many total properties at build-out?
• What are the Property/Homeowner Association Fees (HOA/ POA)?
• There are usually separate fees for golf and other amenities - what are the costs of these? Don’t forget cart fees and trail fees. Is walking the course allowed?
• Is there a yearly cap that the HOA/ POA fees can be increased?
• How much is the developer subsidizing the HOA/ POA? This is probably the most important question because it impacts what dues are likely to be once the developer is out.
• Are there provisions for a reserve fund?
• If a golf community – how many total golf memberships? How many have been sold to date?
• Do you automatically have golf privileges by virtue of owning property?
• If not, what is the cost of a golf membership? Is this equity or a one time fee?
• If an equity membership, how much money do you get back when you sell?
• Does the developer have the ability to sell non-property golf memberships and at what price? Is there a floor at which these properties can be sold?
• Once the HOA/ POA is turned over to the property owners, what percentage of dues does the developer pay on any unsold developer lots/memberships?
• How long is the developer obligated to pay these dues?
• Who owns the golf course - property owners or the developer?
• If the golf course is a losing proposition for the developer, can it be sold to an outside entity? Or worse, can the developer turn the golf course into more development? This has happened in the Hilton Head area!
• At what point will the HOA/ POA be turned over to the property owners?
• Before any properties are closed will the amenity package be completed?
• If not, is there a bond in place so that the money is available to complete these items if the developer does not?
• If there is property on the resale market, land or homes, how many properties are available? What percentage of the total development is available for resale? How do the prices compare to developer property? What was originally paid for these land/homes?
• Ask for the HOA/ POA documents. READ THEM. You will be surprised at what they say. Go over the covenants and restrictions with your client to ensure it fits with your client’s lifestyle.
• What are the zoning classifications for the area? Are there any zoning request changes in progress at this time? A client may buy thinking that only single family residential homes are allowed; how will they feel if they find out that condos or apartments are planned across the street from their lot?
• What are the various warranties provided with a home purchase? Such as warranties on structural work, utility lines, appliances, pest control, and more. Be sure to compare this with the state laws governing builder warranties.
• What features or upgrades are included in the base price of a home? What upgrades are extra and what is the cost of those upgrades? Be sure to go over the return on investment for various upgrades with your client and whether the cost charged by the builder is reasonable for the market.

It is up to us as full-time, professional agents to educate our clients about the pluses and minuses of buying in any development. It is a lot of work to keep ourselves up to date with all the changes in the marketplace, but it is also part of our job. I am sure we all have clients who bought a home/land in these type of communities in the last couple of years, and they are now having a hard time coming out whole.

If your Buyer clients understand the value of taking you when they purchase a new property, not only will they appreciate you more, but you will also get paid for all your hard work!

________________________________________

About the Author: Sally Papineau, Realtor, e-PRO has worked for ten years as a licensed real estate agent with RE/MAX Island Realty serving the Hilton Head Island and Bluffton, SC real estate market. Sally has won numerous sales awards and has successfully built several spec homes in the Hilton Head area. Before entering the sales side of real estate, Sally worked for ten years as a mortgage broker in the Buffalo, NY area. Sally’s web site is www.hiltonheadhouses.com.

Our (almost) three year old little girl came up with some new words this week. Since she is our second child, Jim and I are now completely fluent in toddlerspeak. Well… at least most of the time we understand what she is saying.

Her new word combo for this week is “fu nookies.”

And the first person to comment and correctly guess what that translates to in plain English will win one hour of FREE Link Building/Link Bait consultation.

I am volunteering my husband’s creative mind to provide you with an hour of his time to learn some invaluable link bait techniques. Should be fun - I’ve personally witnessed Jim come up 10-20 outrageous link bait strategies within a 1 hour phone call.

Good luck!

You’ve no doubt noticed the amount of firewood - uh, excuse me, award plaques - on any seasoned Realtor’s office walls. And don’t forget the coveted certificates, badges, trophies, bobble-heads, and other hoopla.

But seriously, let’s take a look at what this all means.

First of all, Realtors use fuzzy math. One $200,000 sale translates to $400,000 of volume and TWO transactions (since both the Buyer’s agent and the Seller’s agent will count the whole $200K each). So, when a Realtor says they’ve sold $1 million in homes, you can assume that another Realtor is claiming that same $1 million. Unless of course, the listing agent sold it; then it would be $2 million… Clear as mud???

Second, what exactly do Realtors get awards for? Everything! Office meetings are littered with applause for #1 Mary Jane who earned the highest commission last month, and for #1 reliable Bob who turned in all his paperwork on time last quarter, and for #1 powerhouse Bill who listed more homes than any other agent in the office last year (none of them sold, but great job on getting those over-priced listings).

But the list does not stop there. We cannot forget the other all-important categories of awards: Most Completed Transactions, Most Expensive Home Sold, Most Trips to the Water Cooler, and so on. Calculate these numbers to find new awardees by day, week, month, quarter, year, decade, solar eclipse, full moon, and pow! You now have 387 certificates to fill out by the next office meeting — and that’s for an office of only 65 agents.

Drumroll please… The first annual FamousAgents.com “Silly and Stupid Realtor Awards” Award goes to our very own Keller Williams Realty office in Glendale, AZ. Here is a list of the actual categories we were asked to vote on for the upcoming awards banquet:

1) Most Upbeat- who is the most spirited, always has a positive attitude, great to be around, spreads cheer around the office.

2) Most Recognized Voice- if you were blindfolded, whose voice would you be able to recognize coming down the hall.

3) Spouter of Rhetoric- who is the “jester” of the office, most sarcastic, contributes humor vocally at Team Meetings, etc.

4) Best Confidante- who is the best listener, you can tell anything to this person, keeper of all the office secrets.

5) Best Dressed- this is obvious. Please pick one male and one female.

6) Agent of the Year- this is the person with the most total impact on the marketcenter, has grown the most since they came to KW in personality, business and involvement, is the most “Keller-ized”.

Whew! Boy, we really know how to be #1 at something, don’t we? Hey, we’ve got to fill that white space on our business cards with something of importance right?

We would love to hear your comments. Please cast your vote for the “Silly or Stupid Award” given out in your office.