Property Investing Secrets 7
November 13, 2008
Property Investing Secrets:
How Buying Real Estate Is Like Planning a Trip to the Greek Islands
One you start property investing, one important tip is to press the flesh with the real estate agents in the areas where you plan to buy. Because property investing is a bit like buying a holiday package, you must separate yourself from the rest of the investors by giving the real estate agents the information they are looking for in your first face to face meeting.
Most people will say to an agent, "I want to buy a property, what do you have?" Immediately they will lose any credibility they’ve established with an agent. You see, imagine walking into a travel agency and saying you want to go on a holiday, and asking "What destinations do you have available?" That’s a dumb question, because the travel agent has hundreds of available holiday destinations.
If you think of property investing like shopping for a holiday, you must give the agent some criteria. If you say to the travel agent, "I want to go on a holiday to the Greek Islands and I want to go on these specific dates, and here is how much I want to spend?" in turn they will put together a package for you. They know because they have received specific instructions from you.
Property Investing Secrets 6
November 12, 2008
Property Investing Secrets:
What No One Ever Tells You-How Real Estate Agents Size Up Buyers
Here is the most important rule you must know about property investing: present yourself with confidence to the real estate agent. If you’re property investing and trying to buy your first property and you have never really dealt with a real estate agent, you’re probably not going to get a bargain. Most likely later, after you’ve made offers and gotten them accepted, will you then get better deals.
You see, the first time up you’re going to have to sound the agent out and see how much experience they have. If you’re dealing with the young pup in the office that has only been in the business 3 or 4 months, you don’t need to know a lot. You can probably even bluff them. But if you’re dealing with the principal, the owner of the business, who has been around for 20 years, they’re going to know that you’re not experienced property investing or more importantly that you’ve never bought in their area and then it becomes a real matter of brinkmanship with the real estate agent.
Property Investing Secrets 5
November 11, 2008
Property Investing Secrets:
How To Work With Agents And Get What You Want
When you’re property investing, it is important to know how to connect with real estate agents. Here are some techniques you can use when you are out there pressing the flesh. I believe it is important to connect with agents at lease once in person when you’re property investing.
I’ve found that when you walk into a real estate agents office and say "I’m looking for a bargain."- that’s a big mistake. When you’re property investing, the minute a real estate agent hears that you want a bargain; they size you up and think this person isn’t serious-they’re a flake. Keep this is in mind, to a real estate agent there is no such thing as a bargain. But it is possibile to buy at a wholesale price. If you’re going to form a relationship with an agent they have to know you’re serious because these agents get hundreds and hundreds of buyers every month or every 6 months, depending how busy they are, coming into their office. Thus real estate agents must know how to size up buyers. They know how to qualify buyers without the buyers even realizing they’re being qualified! Real estate agents question buyers and the answers they hear tell them how serious the buyers are about purchasing.
Property Investing Secrets 4
November 10, 2008
Property Investing Secrets:
How to Sell to 100% of the Market Place Using Lease Options
When property investing, you will find if you make houses easy for people to buy, your properties will become easier to sell. Most people who are selling houses today are selling to the 80% of the population who have good enough credit to qualify for a bank loan. These buyers have choice. They have been approved for a loan and they can look at 20 or 30 properties and negotiate hard with the sellers. It’s important to note when property investing that this is not necessarily your market when you sell on a lease option.
I’ve found when property investing that when your exit strategy is to lease option to a new buyer you’re targeting people who may not immediately qualify for a bank loan. This makes up about 20% of the population. Perhaps they are investors who can’t get any more bank loans or they’re new to the country and haven’t established a credit file that will satisfy banks. Sometimes they have a lot of cash but didn’t pay their credit card or phone bills on time and they can’t qualify for a loan due to these credit issues. Also a divorce will hurt credit files. Usually it is not major things, it is just credit issues that stop people from getting a bank loan today, but they can probably qualify in a year or two.
Property Investing Secrets 3
November 10, 2008
Property Investing Secrets: When you Make Property Easy to Buy for People Using Vendor Finance It Is Easy To Sell
When property investing, my goal is to make it easy for people to buy my properties, that’s why I offer vendor finance. You have the advantage when you buy properties from sellers when property investing. I always think: "Why do I want to go a get a bank loan when this seller already has a loan? Why don’t I just take control of their loan if the seller is open to me making payments on their mortgage?" You’d be surprised how easy this is and how simple the paperwork system is. And once that’s complete, you vendor finance the property to a new buyer.
Let’s imagine that the seller has agreed to this arrangement and moved. You look after the mortgage on their house, you’ve got no bank liability, you’ve got no loans and yet you start creating assets and any future capital gain and profits. In many areas you have sellers who are unable to make their mortgage payments that they have liability on and this is a very simple way that you both benefit when property investing. Your exit strategy is to vendor finance this property to a new buyer and receive positive cash flow on the deal.
Property Investing Secrets 2
November 9, 2008
Property Investing Secrets:
How You Can Turn A Below Average Deal Into Streams Of Income
When property investing, sometimes you’ll get a seller who will say: "Sure, I’m retiring, and I need some cash flow, I need some money but if I deposit it in the bank, I’m not going to get much for it. The property market is falling, there aren’t a lot of buyers and they are all beating me up on the price of my house. But if you give me the price that I want, know that I’m not going to be able to live forever. So you’re going to have to pay off the balance to me in about 5 years." When you’re property investing, you will come across sellers like this. In the past, you may not have known what to do with them. Consider this now; you may be walking past streams of income.
Property Investing Secrets 1
November 8, 2008
When property investing, pay the seller their asking price but negotiate the terms under which you can buy property. You’d be absolutely surprised when property investing at how many sellers will help fund you into their property. Basically, you’re receiving vendor finance from the seller.
Let’s take an example of a $300,000 house. The seller wants $300,000 for their property. When property investing what most people will do is they’ll negotiate all day long to get the price down from $300,000 to $270,000. Then when buyers have negotiated to get the house for $270,000 they’ll get a bank loan and have the liability of a loan. They’ll get a 30 year loan and after about 5 years of making payments they will probably owe about $260,000. Instead I’d like you to consider a different strategy when buying: get the seller to vendor finance you into their home.
Why Not To Invest In Bulgarian Property
November 7, 2008
According to research carried out by the Thomson Group, owning a property abroad is now the ambition of over 50% of the British population. Not surprisingly Spain and Cyprus remain the most popular destinations for second home buyers while countries like France, Italy and Portugal continue to grab their fair share of the property investment gold rush!
While the usual suspects will always attract the more cautious, risk aversive investor, the most recent generation of property investors can’t seem to get enough of what our Eastern European neighbours have to offer. Eye-popping prices in the former communist states draw thousands of us to the shores of countries practically unheard of before they popped the for sale sign into the national soil. None, more so than Bulgaria and let’s face it, people knew that a property in Bulgaria could be picked up for £5000 long before they could point to Bulgaria on the map.
So what’s the big attraction? Well, unless you’ve been hiding under a rock for the past twelve months you’ll know that cheap property prices, the promise of high capital growth, pending EU membership and spectacular scenery are just a few of the treasures attracting investor cash to the country and some might ask what else could an investor ask for?
Do You Speak Real Estate?
November 6, 2008
Anyone interested in real estate should be able to talk the talk. Here is a list of common phrases and words with a short explanation. Use it as a reference:
Adjustable Rate Mortgage (ARM). A type of mortgage loan whose interest rate changes periodically up or down, usually once or twice a year. They are tied to an interest rate index like 11th District Cost of Funds.
Annual Percentage Rate (APR). Everything financed in your mortgage loan package (interest, loan fees, points or other charges) expressed as a percentage of the loan amount (usually slightly above the actual interest rate alone).
Assumable Loan. A loan in which the lender is willing to “transfer” from the previous owner of the home to the new owner, sometimes at the same interest rate, sometimes at a new rate. An assumable loan can make your home more attractive to buyers when you want to sell. Often the new buyer has to qualify for the assumption just as he/she would for a new loan.
Closing Costs. Costs the buyer must pay at the time of closing in addition to the down payment: including points, mortgage insurance premium, homeowners insurance, prepayments for property taxes, etc. Closing costs average 3% to 4% of the loan amount.
Investment Property - Leveraging Rental Property Equity
November 5, 2008
Owning investment property is a tremendous wealth building strategy. Thousands upon thousands of individuals have amassed great wealth by investing in rental properties.
Unfortunately, few investment property owners learn how to leverage equity in a way that maximizes tax deductions while creating and locking in equity gains. Instead, they leave themselves open to price fluctuations in the residential property market. These fluctuations can wipe out or severely reduce equity positions in property.
Housing Boom To End?
There is little doubt we are coming to the end of a huge boom market in residential properties. For the last four years, properties have appreciated at unheard of rates. The question, of course, is what happens when the market cools off? Will we simply see a price plateau or an actual drop in prices? While nobody is sure, the clear consensus is property owners should move to preserve equity while they can.
Protecting Equity Gains
Protecting equity gains in your investment property requires careful planning. This leveraging strategy is fairly simple, but can sound complex. Please keep in mind this is just an introduction to the investment property tax strategy. You will need to contact us to learn more.
