Real Estate Tips

Will Real Estate Investing Always Be Profitable?

2008-12-10T07:21:00.000-08:00

Every decade some analysts say there will be a real estate crash. Smart investors realize there will always be money to be made in real estate investing.

One of a human's basic needs is shelter. There will always be a constant need for shelter and therein lies the reason why real estate investing will always remain profitable.

You might see a local real estate market decline due to a disaster but real estate investors can profit in those areas as well if they are well trained in investing.

Don't listen to the naysayers. As long as there are people, there will be a need for shelter and you will want to be there to fulfill that need.

HELOC Loans

2008-12-04T04:40:00.000-08:00

A lot of people don't really know what a HELOC is. It is a home equity line of credit where the homeowner can use the equity built in their home to get a second mortgage.

The HELOC works somewhat like a credit card. You are given at closing a specific credit limit that you may borrow up to.

In most cases you will make interest only payments unless you wish to reduce the principle.

A HELOC can be used for whatever you want to do with the money. Some people use it to make home improvements and some people use it to invest in real estate.

In real estate investing if you have a HELOC that will cover the cost of the property you want to buy, then you can probably get a better price because it will be a cash deal. Plus there will be no 6 to 8 week mortgage approval so you can have a quick closing.

A HELOC can be very useful but remember that it is a second mortgage against your home so use it wisely. Talk to your mortgage company or banker about HELOCs to find the right one for you. You can also shop around for better interest rates.

Real Estate Investing For Beginners

2008-07-24T17:46:00.000-07:00

You don't have to have thousands of dollars to begin real estate investing and to begin making a living from it. In fact, real estate could help you get those thousands of dollars. You can work your way into a passive or residual income from real estate by following a few specific rules that can help you make your investing into your fortune.

When you start thinking of beginning real estate investing, you can start by finding a property that only needs a little fixing up and can be used for other purposes. There are foreclosures and pre-foreclosures and other types of investing vehicles, such as rent to own opportunities. This will give you the ability to make a small investment in order to get a large profit.

If you make the right type of real estate investment, it is only a matter of time before you begin to profit off of the investment. Any source will tell you that real estate will naturally build wealth over time. Because the economy and market continues to change and increase, real estate will also continue to increase.

Residual or passive real estate can allow you to make money simply by owning property in a variety of places without having to do the work that is involved with the property. Things such as rental properties can help you to put money in your pocket. You could slowly grow your rental property portfolio and have multiple streams of income flowing in each month like clockwork.

Real estate investing is a great way to begin putting income in your bank account without having to work long hours and labor at a job that doesn't offer as many financial benefits as the real estate business.

Some Tips For Flipping Houses

2008-07-23T08:30:00.000-07:00

There is money to be made in flipping houses, but there can also be drawbacks. Weigh each deal carefully to avoid some house flipping mistakes.

The condition of the property plays a big part when considering flipping it. How extensive will the repairs be? Will it be cost effective? A broken slab or other damage to the foundation can lead to a large outlay of money to repair.

Make sure you have a written plan for the profit potential of each flip. You have to take into consideration that there will be expenses that you were not counting on. Always pad your repair budget for any of the extra expenses. If you end up not needing it, then that's great but you want to make sure it is there, just in case.

Consider the neighborhood when looking at a possible flip. Is this a rental neighborhood? If so, you might have a hard time selling right away.

These were just a few of the things you need to consider when contemplating a flip. It's not as easy as you see on TV, so study everything very carefully and if everything checks out, go for it!

Vacation Rental Properties For Real Estate Investing

2008-07-20T11:23:00.000-07:00

Have you ever considered making some money from vacation rental properties? If you already own a vacation property that you go to several times a year, then you are all set to make some extra money.

During the times when you are not there you can rent it out to pay the mortgage, insurance and taxes on it. If it is paid for you can use the rental income to pay the taxes and insurance and pocket the rest. It's always nice to have a little more income coming in.

If you don't own any vacation property it might benefit you to consider buying some. Then, as above, you can rent it out for the mortgage payment or just pocket the money.

One of the drawbacks to vacation rental properties is the upkeep from a distance. It is best to have someone in the area to maintain the grounds on a regular basis and have a contact to someome you can call for emergency repairs, such as a pipe bursting, etc.

If you've ever wanted to get into real estate investing but just weren't sure it was for you, then this could be a good place to start. This is especially true if you already own a vacation property.

Real Estate Investing Using Your 401K

2008-06-06T06:39:00.000-07:00

Most people do not think of their 401K as a personal investment vehicle. This is your retirement fund and you do not want to risk it. Real estate investing can be risky if you are inexperienced, so you need to have a thorough knowledge and first hand experience in real estate investing before thinking about using your retirement fund for investing.

The way a lot of people are using their 401K to invest in real estate is by taking out a loan against their 401K to invest in real estate. Once you have completed your real estate transaction and hopefully made a good profit, you can then pay off your 401K loan and pocket the profits.

There is a limit to how much you can borrow against your 401K. You can only borrow a certain percentage of your 401K balance. This is a good thing because you cannot be tempted to deplete your retirement fund with real estate investing.

One down side to using this method of financing real estate is that there are no tax benefits when you use your 401K as an investment vehicle. It will not be eligible for the tax deduction for mortgage interest.

You can also roll over your 401K into a self-directed IRA and your profits are tax free until you draw them out.

It is best to speak with a retirement specialist to get all of the details involved if you are considering using your 401K for real estate investing. Remember, this is your retirement fund and although it is attractive to be able to use a portion of this money for your own investing, you need to weigh carefully all of the different ways this can be done to protect your savings for the future.

Marilyn Roberts

Real Estate Appraisal

2007-09-28T08:03:00.000-07:00

A property valuation or real estate appraisal is a system for determining a property's value using fair market value guidelines. A real estate appraiser or property surveyor are the ones who usually perform this. There can be different values placed on the appraisal or fair market value using various methods of determination.

There may be two different values on a particular property which could be vacant value and improved value. A property in a residential zone would be valued differently than one in a commercial zone.

As a real estate investor you would not necessarily go by the appraised value that you would get from a real estate appraiser.

A real estate investor would also evaluate on the basis of what developments were going on in the area. Investors might also want to evaluate based on the value in 2 years or 4 years, etc.

Repair value is also included when a real estate investor is evaluating for possible profit potential. Sometimes minor repairs such as landscaping and painting can raise the property's value. Large improvements such as a new roof, new flooring, new appliances, etc., can greatly increase a property's value.

Therefore, a real estate investor considers property on a different scale than a real estate appraiser. This is not to say that a real estate appraisal by a professional is not accurate but an investor includes many other factors when coming to a market valuation price.

Using an appraiser's estimation and your own, as an investor, will give you a good determination of a property's fair market value. Do your own homework on your potential investments and you will have a good chance of making the profit you are looking for.

Marilyn Roberts

Investing In Foreclosures

2007-08-28T09:29:00.001-07:00

Buying homes in foreclosure has become a big business for real estate investors. They can be purchased cheaper and after rehabbing them they will be worth more in value.

Sometimes a property is in foreclosure because of not paying taxes on the property or not being able to pay the monthly mortgage payment.

In most cases the bank has taken back the property because the owner did not pay his mortgage payment. The bank now owns the property and since they are not making any money on this property, they will want to sell the foreclosure as quickly as possible.

A lot of these foreclosed properties are sold at auction to the general public. This is a good way for a buyer to get a house cheaper as they are nearly always below the true market value. Real estate investors can also make money from buying these foreclosures, then fixing them up and selling them for a profit.

Buying foreclosures has become very popular for both investors and home buyers. If you are a new investor this is a good place to start. Commercial real estate foreclosures can also be bought this way and can be very profitable.

The courthouse will have a schedule and listing of foreclosure sales. You can also find this information in the newspaper.

If you think investing in real estate foreclosures is something you might want to try, start going to some of the auctions and see what the proceedings are like. Get familiar with the auctions so that when you are ready to bid on your first property you will not be too intimidated by the procedures.

There are also auctions on the courthouse steps. Call your courthouse to get a schedule for these and the requirements for bidding on these properties.

Start learning the ins and outs of buying foreclosed properties so that you will be well prepared if you decide to invest in these properties.

More Tips For Selling Your House

2007-08-23T14:52:00.001-07:00

If you already have your home on the market and it has not been selling, read these tips and they might make a difference between lookers and buyers.

Curb appeal, curb appeal, curb appeal. This is the first impression a home makes on a buyer. If they don't like the outside they may never stop to look inside. Keep the lawn mowed at all times. Trim the trees. Manicure the shrubbery. Weed flower beds. Get rid of all of the dead plants, do some deadheading. If needed, try to paint the outside of the house and the trim. This can make a huge difference. Put away any miscellaneous items in the yard such as toys, old tires, trash, etc. Try to keep your garbage can out of sight also. Roll up your water hose.

On the inside of the house one good thing to do is paint using a neutral color. Put away all clutter, most knicknacks, and personal photos. The buyers need to be able to picture their own things there and that is too hard to do if it is too personalized. Keep the furniture to the minimum so that buyers can get a good feel for the square footage. You can rent a mini warehouse for a small amount and store any excess furniture, clothes, boxes, etc. You are going to be packing these things anyway when you move so this will put you one step ahead. Straighten all of your closets and cabinets. Don't think people won't look in them, they will! You want them to see that there is plenty of storage and closet space.

If you have decided to sell your home 'By Owner', you might want to try it for two months and if there are no offers and not much interest, then you might want to list your house with a realtor. There will be a commission but your house will get a lot more exposure and will have a better chance of selling.

Try looking at your home through the eyes of a buyer and you will probably see some things that need to be changed. Your house will be a big investment for someone to make just as it was when you purchased it.

Make sure your house puts it's best foot forward and you will reap the benefits.

Real Estate Investing Beginner's Story - Part 3

2007-08-22T09:05:00.000-07:00

This is a continuation of my beginning investor story.

After having rented the house for a few months we decided to put a mortgage on it. We got a new mortgage for $24,000.00. With this money we payed off our credit card and had plenty of cash left over.

We started looking for some more investment property and found a four-plex apartment building going on auction for $16,000.00. We bid on it and got it. We then had a lot of fix-up to do but we eventually rented all four units.

We ended up keeping the rent house and apartments for four years. We never had a vacancy for more than a week. We have since sold the rent house and the apartments and gone on to other things.

And that was how we became real estate investors.

Could we have done it without a credit card? Sure we could! We would have continued cleaning houses until we got the money.

Could we have done it without our husbands' labor? Sure we could! It would have just taken a little longer.

If you want to accomplish anything, even being a real estate investor, you need to make a plan and stick to it. We would have become real estate investors no matter what the obstacles because this was our dream and we didn't let anything stop us.

Write down your goals and work towards them every day. Sometimes you will have large goals and sometimes small goals but keep chugging away at them.

If you want it bad enough, go out and get it!

Marilyn Roberts

Real Estate Investor Beginner's Story - Part 2

2007-08-22T08:57:00.000-07:00

In case you missed it I started this story in my last post. To continue...

We went to the auction (which was pretty scary for us because we had never been to one before) and when our little house came up we were the only ones bidding on it and we got it for $6,000.00

I am not going into all of the details as that would be about 10 more pages, but in a nutshell this is what we did:

We continued to do our house cleaning to pay the credit card payment and the repairs on the house. Luckily our husbands helped us do most of the repairs. While we were working on the house several people stopped by and wanted to rent it.

We originally were going to fix it up and flip it but we decided it would be more cost effective tax wise to hold on to it for at least a year and rent it out. So we rented it out and as there was no mortgage, this was all profit. At this point we stopped house cleaning and started looking for more property.

I will finish this in my next post as it is becoming long.

Real Estate Beginner's Story-Part 1

2007-08-22T08:46:00.000-07:00

Hi,

My name is Marilyn Roberts and I am a full time home based medical transcriptionist, real estate investor, commodities trader, writer, and internet marketer.

I want to tell you how I first became a real estate investor quite a few years ago. My niece and I were both housewives with no particular skills or training in anything. We started watching some of the programs that were very popular then by real estate investors. The more I learned, the more I wanted to do it. So my niece and I decided we wanted to be real estate investors.

The first obstacle was that we didn't have any money. I didn't know anything about buying with no money down or using creative financing. I just knew that we needed to make some money if we wanted to be investors.

The only skill we had was house cleaning, so that is what we did. We got one house to clean every two weeks. That wasn't much to start with but within two months, through word of mouth, we had a house to clean every day and saved every penny we made. No shopping trips for us. We were going to be real estate investors!

During this time that we were cleaning houses we were also looking at property and decided that the foreclosure market was the best way to start. We began to look at foreclosure property in our area and one day we found it! A little house going on auction for $6,000.00 cash. We went and looked at it and decided we could fix it up and sell it for a profit.

The only catch was that we had only saved $2000.00 and we needed at least $4,000.00 more. I put on my thinking cap (this is something that always scares my husband) and came up with the idea of getting a credit card and then getting a cash advance for the $4,000.00. That is exactly what we did.

This is getting a little long so I will continue this story on my next post.

Real Estate - Tips For Buying Fixer Uppers

2007-08-17T09:30:00.000-07:00

There are a lot of definitions of what is exactly a fixer upper. Sometimes it can be a house not in completely move-in condition but only needing minor repairs and touch-ups. It could also be a really run down house with a leaking roof, foundation problems, and major work needing done.

Although buying a fixer upper can scare some people, it is also a good way to get into a bigger and better home in a better neighborhood for just a fraction of the cost. You would just have to be willing and financially able to make the necessary repairs.

If you are looking for a house, don't pass up looking at the fixer uppers. Sometimes you can get a really good deal on them and get a house that you normally would not be able to afford.

If you do decide to look at fixer uppers, it might be a good idea to get a contractor to go with you to give an estimate on the cost of repairs. Sometimes it might not be feasible or affordable to get the fixer upper and it is better to find out sooner than later.

Be flexible when you are house shopping and you might find that 'diamond in the rough' and make the best deal of your life. You might also get stuck with a lemon that had hidden problems that you weren't prepared for.

Think smart. Get an expert's opinion. Eventually you will find that perfect house and all of the trouble would have been worth it.

Real Estate Investing - What Beginners Need to Know

2007-08-14T08:47:00.000-07:00

If you are thinking about investing in real estate, your first step should be to get some real estate training. This is going to be a business you are growing and you need all of the information and training you can afford to get started right.

There are many things you will need training in. I have listed some of these below:

1. Learning how to locate properties that you can make a profit on.

2. Deal negotiations are a vital part of being a successful real estate investor. You need to be able to negotiate as a seller and as a buyer.

3. Various strategies and techniques that are used to have a profitable real estate business such as no money down, owner financing, wholesaling, creative financing, etc.

4. Real estate terminology. This is important when talking with banks, mortgage companies and other investors, as well as buyers and sellers. What are points? What is ARV? What is hard money? Real estate has a language of it's own that you will need to know in order to successfully make real estate deals.

Don't jump into real estate investing until you have a good grasp of all of the ins and outs of investing. You will feel more confident if you are well versed in the different options of financing, rental properties, and even house flipping.

Joining a local real estate investment club can give you the opportunity to meet other real estate investors, agents, mortgage company representatives and many more people involved in real estate investing. A lot can be learned from these meetings and you will get a lot of contact information which can help you on some of your deals.

Start studying and learning now and in no time you will be ready to make that first real estate deal and start your own real estate business.

Real Estate - My House Won't Sell

2007-08-13T08:51:00.000-07:00

Are you having a hard time selling your house? There can be many reasons why your house has been sitting on the market for a long time.

Sometimes it is market fluctuation because of the season, supply and demand, and the present state of the economy.

Overpricing your house can cause it to not sell. Sometimes a seller will set a higher price in order to have some negotiation room. There are times that this will work, but other times the buyer will be intimidated by the high price and not make an offer. They can also be off put by thinking you are just plain overpricing the property. So be very careful when pricing your house. Check comparable homes in your area for price, square footage, upgrades, etc. Don't price yourself out of the market.

If you are trying to sell the house yourself, you may not be getting enough exposure. Where are you advertising your house? Are you always available to show your house? Do you have an answering machine to catch any calls when you are not home? The answer to these questions can have a lot to do with whether or not you are getting enough people in to see your house.

Using a real estate agent can usually get your house seen by more people, especially if they have MLS (Multiple Listing Service). This gives other realtors the opportunity to sell your house also for a split of the commission.

Another thing to make your house easier to sell is if it has good curb appeal. If the curb appeal is not good, then no one will want to go in to look at the house. You want to give the appearance of a well-maintained yard. Keep it clear of toys, trash, dead plants, etc. The less work a prospective buyer sees to be done, the more likely they are to sign on the dotted line.

Keep your house clean and neat while it is on the market. This is sometimes hard to do if you have children, but you will need to go the extra mile for the length of time it takes to sell your house. This would be a good time to get rid of anything you no longer need such as old furniture, clothes, toys, etc., anything that you will not be taking to your new house anyway.

You could also pack up a lot of things that you would be packing up anyway for the move. Then rent a storage unit until your house sells. You can store a lot in a storage unit and it doesn't cost very much to do so. It will be well worth it if it helps you to sell your house faster and you will have the advantage of having a lot of the packing already done.

Try some of these steps if you are having a hard time selling your house. Maybe one of them will be the very thing that gets your house sold.

Real Estate - Increase Your House Value

2007-08-12T09:49:00.000-07:00

Increasing the value of your house can be done in many ways. Sometimes it can be small projects you can do yourself and sometimes there are larger projects that will require a contractor.

Painting the inside or outside of your house can completely change it's appearance. This can be one of the smallest investments you can make to add a lot of value to your house. You can take your time painting the house room by room at your own leisure and choosing colors to suit your taste, On the outside, if you have brick or stucco, you can rent a power washer and power wash all of the outside walls and this will make it look like new. Also you can paint the trim, the front door, porch, etc. to add value to your house.

Upgrading your flooring can also make a big difference. Whether it is carpet, tiles or wood, a new floor will greatly increase your house value.

Upgrading your kitchen can be one of your best investments. This will give you more bang for your buck as far as increasing your house value. Replacing old appliances, replacing or repainting the cabinet doors, new counter tops, etc.

Replacing an old roof can be one of the longest term investments you can make. A new roof is usually guaranteed for 10-30 years. If you ever considering selling your house, this will be a good selling point.

Upgrading and updating your bathrooms is another good investment. Although this can be inconvenient and expensive, it will greatly enhance your house value. Sometimes just replacing the old floor with a new tile floor will be very cost effective as it is a small space and well worth the effort.

These were just a few of the things you can do to increase your house value. Your house is one of your largest investments. Take care of it and it will keep appreciating in value.