1. The “F” Word.
Foreclosures are at an all time high. Just about every one of us can think of a family member or friend in foreclosure, or at least a neighbor. While this is a sad result of the mortgage meltdown and the current job market there are still silver linings to every cloud. Banks are more willing to offer deals on REO (Real Estate Owned) properties that they are holding in their over inflated non-performing asset portfolio. They need to move these properties to stay properly capitalized and your chances of getting a good deal are getting better and better every day.
If you have not started to track foreclosures in your market you need to begin today. Keep an eye on homes that go into foreclosure. Then you can identify the homes with the most potential of being a good deal. If the home goes all the way through the foreclosure process make sure you follow up with the bank before the home makes it on to the open MLS market. This will help you develop relationships with the banks and find some real nuggets along the way.
2. The “I” Word.
OK so maybe it isn’t as easy to get a mortgage as it was a couple of years ago. We all know the market has tightened up. The fact is there are still a lot of people with jobs and good credit that can get a mortgage. Fannie Mae recently loosened their rules on the number of homes investors can finance from 4 up to 10. 10 homes is quite a few if you are just starting out.
Even more exciting is that interest rates are at an all time low. If you can get a good deal on a home in foreclosure and secure a 5.5% interest rate then it becomes extremely easy to cash flow on a rental property. Many experienced investors have been making it work for years at 10% interest rates. We should all be able to hit a home run at nearly half of that! Check your credit and find a good investor friendly mortgage broker and find out what you qualify for today.
3. The “T” Word.
Back to the number one reason to invest today, foreclosures. So many people are in foreclosure or have recent job losses it is making it extremely difficult to become or continue to be homeowners. While this may not be a permanent situation it does make the rental market one of the best we have seen in years. I have many clients who are prospering in the rental market. Even better are those tenants that would like to be homeowners today, were yesterday and will be tomorrow. These tenants have the potential to lease a home right now with the opportunity to buy it once their situation has improved and the mortgage market has opened up again. This is the wholly grail for real estate investors as we can cover cash flow today with the big pay off in the future when we sell the home.
I am not saying that it is easy to invest in real estate today nor do I think this is the kind of market where you are going to flip three houses a month and become a millionaire in six months. For those with vision and with the proper training you could be setting yourself and your family up for amazing wealth over time. So many people have kicked themselves for not getting into the market fifteen years ago. Don’t be that person fifteen years from now.
There are many decisions that you will need to make when investing in real estate. One of those choices, for those handling rental properties, is whether or not you need a property manager. Property managers have many purposes and are a great idea for those who have several properties to handle and want to have a life away from their real estate investing business. A property manager is your buffer between your tenants and your family.
The benefits of a good property management service are quite numerous. To begin with you will find that they eliminate the need for tenants to have your phone number. If you’ve dealt with rental properties before without the buffer of a property manager, you are surely aware that it doesn’t matter what time of night or the morning things go wrong, you are the first person your tenants call to patch up those things. It also doesn’t matter to the tenant whether the issue is very minor and could easily wait until a decent hour to report. A property management service is able to deal with many things for you while letting you sleep through the night. It’s no small favor when you think about multiple tenants as you purchase more properties. A few late night phone calls and many rental property owners are almost ready to get out of the business of renting properties.
Property management services often have a qualified staff of maintenance people that can deal with many of the things that go wrong with rental properties. The fee for these services may be included in your fees for the using the property management service in general or certain services may charge additional fees. Regardless, your property manager or property management team is often the best source to find contractors to handle the repairs they cannot make for you, as well as the repairs that they can. It’s nice to know that you won’t be getting up bleary eyed in the morning calling around for a plumber on the first exceptionally cold day of winter. Moreover it’s nice to know that someone else can deal with some of the negative things about owning rental properties.
My personal favorite reason to seek the assistance of a property management service is that they are qualified to handle the legalities of taking care of tenants who cannot make the rent for months on end. This is after all a business and while you can relate to the circumstances that leave some people unable to pay their rent, you need the income from their property in order to pay your bills. It’s much easier to leave some of the less pleasant tasks to someone else, especially if you are a softy for sob stories.
Property managers also handle the advertising for your property and the cleaning up and retouches that are essential between tenants. They also allow you to take vacations assured by the knowledge your properties and tenants are in good hands even when you aren’t there to watch over everything.
If you are going to invest in real estate, this is one of the most worry free ways you can do it. The more properties you have, the more sense it makes to utilize the services of a reliable property management team. Copyright 2008 Promotions Unlimited – websitetrafficbuilders.com. All rights reserved
Investing in real estate can be a profitable business venture, but just like anything else in life, it requires you to know what you’re doing. There are so many unknown variables and countless things that could go wrong. This is the fear that prevents most people from even owning their first property.
Real estate can be a vehicle to financial opportunity, but you have to first define your goals.
But don’t give up hope yet, with the proper preparation and education, you can dive in and earn a living from the real estate industry that have created more self-made millionaires than any other industry.
Before you get started, the first thing you need to consider is what exactly do you want to accomplish. Be sure to keep in mind the various aspects of what being a real estate investor entails.
This will require some research on your part, but it can be an excellent opportunity for you to dig up new and exciting methods for budding real estate investors.
You’ll want to choose an area that you’re very familiar with. This way, you’ll get to know the market value. Once you’re familiar with your chosen area, you’re now the expert and you’ll be able to recognize when a property really is a bargain.
This research can be accomplished with the use of online information, or you can do it in person at city hall. You’ll be checking the city records for a list of recent sales in the county. Don’t overlook the use of your local realtor. They can provide you with detailed information just from a few clicks using the MLS services.
The next things to consider is whether you’re looking for short term profits or if you want to have ongoing monthly income.
If you opt for the short term profits, your choices can be wholesaling or retailing. Wholesaling is where you find properties and then assign them to another real estate investor. This method is a great way for beginners to test the waters, because it requires very little money and none of your own credit.
Another method is called flipping. Just turn on your TV any weekend or weeknight and you’ll be sure to see several programs in which investors purchase run-down property, rehab them and then resell, hopefully, for a profit.
The other option, which includes acquiring a property for ongoing income is another attractive choice for many. If you’re able to produce a monthly passive income, this can be easily become holy grail of real estate investing. To create the desired income, you would just start acquiring properties to meet the monthly income desired.
However, being a landlord may not be all fun and games. You have to know whether you have the temperament for dealing with tenants, and it’s usually when things are not at their best.
So by deciding what type of income you’re after, you can better define your real estate investing goals. Now that you’ve clearly define your expectations, you can set a course to begin your new venture as a real estate investor.
Investments are supposed to be everyone’s consideration in life if you need to make money. In the case of long term investments, very few choices are available which can rival real estate investing. Long term investments have been known for their good pay backs. This can be better demonstrated by the fact that the world’s population is ever growing with the passing of time and the need for better places to live in is also on the rise. The job now is to get a property to invest in which is appropriate, after which your can start to work out means of achieving your dreams. To make a good real estate investment, you have to plan very carefully. This means that you have to get all the information that is available about investment. The real estate investments are not cheap therefore you should be aware of what you are getting yourself into. Never rush into making any decisions about investing because this may be very costly at the end. When you have all the information, you are now able to make a good decision regarding the amount of money that you are ready to put into the investment. It is at this stage when you decide the method of payment that you use. This includes loans, mortgages, credit or private financing.The other good strategy is writing down your investment plan. You will need to know before hand the amount of money and time to put aside for this investment. You will also need to be fully committed to this project for it to be a success. Identify the short term and long term goals which you wish to achieve by entering into such an investment. When purchasing a home make sure you are well aware of the various aspects that are involved in the process. This includes the plumbing, heating systems and electrical fittings for your home. This can even help you to get a better deal when you are making your investment. If the house that you buy needs some repairs, you should negotiate for a lower price because you will need to make some changes which will cost you money.Visit a website that lists available properties for sell when you are trying to find out the prices and the taxes which apply. Find a good accountant who is well versed on issues concerning taxes and the laws governing such investments in that are. The accountant may also offer investment advice.
