Posted by: Vincenzo in Single Families, selling homes, Remodel, Rehab, Real Estate Investment, Real Estate, Property Ownership, Market Prediction, investing, Homes on the Market, Getting Started, Foreclosure, Flipping, Equity, Due Dilligence, Buying Homes on
May 18, 2010
There are a number of people in today’s market that are looking to put their money to work in more ways than one. Sure you can invest in the stock market like every other person out there or just buy an annuity that will give you a steady stream of income. Or you can invest in the real estate market that is just filled with more properties than anyone has ever seen. Because of the persistent presence of bank foreclosures, the real estate market has many amazing deals. This type of investment is not for the faint of heart, since your money may be tied up for months to years. There are a few ways you can invest in real estate that will make you money. The most recognizable way that people have made money was buying homes to flip in the short term. The other option is to hold them as rental properties for a few years while it is rented out for a steady stream of income. If you are looking into flipping homes you need to have expert knowledge of the area to make sure you are buying it at a price that will make you money. You also must consider the money needed to update the home so that it will sell quickly. As a general rule the nicer the home looks compared to others on the market the faster it will sell. However the investor must be careful not to put too much money into the home where he has no chance of recouping that upgrade. For example putting in a pool will cost more than you will get when you go to sell it. It might look great but items such as pools will not return the investment required to put it in. The goal in these types of investments is to buy and sell as many houses as you can. You need to find the right people who will help you achieve this goal such as local contractors and Realtors. They will be the key to helping you find the property, fixing it at the best price and then putting it back on the market.
The other type of real estate investing that is going on these days is to buy and hold as a rental property. There are many condos and smaller homes on the market that make great rentals. These can be so cheap that in a few years your entire investment has been paid off by your tenant. You still have to do your research and know the area before you buy. Making sure that your condo is in a safe part of town with stable employment is very important. If the tenant loses a job the faster he or she finds a new one the better off everyone is. Also knowing the area rents give you an idea of what your monthly income will be from your investment. With this monthly cash flow coming in you can even take part of it and trade the currency markets. With the help of forex trading charts you can take that monthly rent and double it. This is not to say that you might want to spend it on a vacation for you and your wife, but a forex position is a good way to hedge against your real estate holdings.
You can also buy real estate because you feel as if renting is giving your money away. This is very true. While renting you are not building wealth and only paying the owner of the property to go on vacation and play on his boat. Once you become a home owner you have that feeling of accomplishment knowing that you own a home. You don’t have to worry about a security deposit or wondering if your landlord will ask you to replace the carpets. The entire home is yours and you are free to do whatever you want to it. After all owning your own home is considered the American dream, and in today’s market you can buy that dream for a lot less than in the past.
Posted by: Alan Brown in Single Families, secure notes, Retirement, Real Estate Investment, Real Estate, Private Lender, Land Trust, investors, Investment, investing, Hard Money Lender, Getting Started on
Jul 03, 2009
Investing in fixed secured real estate notes can yield fruitful returns often higher than mutual funds while providing security of investment only found with bonds and CD's. Conservative investors looking for stable long-term investments such as bonds, CD's or money-markets currently only receive APR rates between 2% and 4%. The inflationary period looming due to government spending, budget deficits and money printing will continue to drive these investments into the ground. A high price to pay for security of investment.
What Is A Fixed Secured Note Backed By Real Estate?
A first position high yield collateralized note much like a lean held by a mortgage lender on a piece of real estate that can be called due if the terms of the agreement are not met between lender and borrower. In this case, the note holder (i.e. private lender) would simply take control of the real estate if the terms of the loan are not met. The borrower (i.e. real estate investor) will buy a piece of real estate with the money provided by the note holder. The two parties agree on a set of terms of the note. The property is purchased and the term starts. A fixed secured note can also provide investors such as retirees tax free income by using a self-directed IRA for the source of the note. For more information on self-directed IRA's visit: http://www.trustetc.com
Terms
The terms of a fixed secured note are generally 3 to 5 years, 6% to 10% APR interest only with monthly payments. There is typically a balloon payment of the original principle payed to the note holder at the end of the term just like a CD.
Posted by: Nick Johnson in Single Families, Remodel, Rehab, Recession, Real Estate Investment, Real Estate Agents, Private Lender, Preforeclosure, Offer, Motivated Sellers, Mortgage, Market Prediction, Investment, HUD, Hard Money Lender, Getting Started, FSBO, Foreclosure, Financing, Economy, Due Dilligence, Bank Owned on
Feb 18, 2009
Over the past 12 months my partners and I have been buying single family home foreclosures. Homes are selling for deep discounts and providing high cash-flow rates once rented. Our strategy is not to buy and flip, but to buy, rehab then rent to provide cash-flow and capital appreciation. On the surface this may seem as easy as drinking coffee because of the high number of foreclosures available. But don't be fooled with high quantity and low prices. Buying foreclosure properties is not as easy as it may seem. Buying houses for cash has been our strategy which is one way to up your chances of success. Refer to my previous article "Buying Real Estate With All-Cash" In todays article I'll outline another strategy that when paired with all-cash works for us.
Relieving Some of the Burden
Buying homes at deep discounts for cash relieves vacancy pressure as there is no unerlying mortgage. You may still have a lean on the property held by a private lender but hopefully you have worked out the terms so that you have 60-90 days until your first interest payment. Racing out to find a tenant before your first payment is no longer a pressing issue. You can be more choosy when screening tenants. You can hold closer to your asking rent price and not decrease it just to get the property occupied. You can save money by performing more of the rehab yourself. These are just a few of the benefits.
The Problem With Real Estate Agents
As easy as it might seem to buy real estate at low prices, a problem has arrisen that must be addressed if we are to successfully close deals with banks. I have found, as with many of my collegues that seller real estate agents have all the control when it comes to you submitting your offer, deciphering which offers to submit, how much information they tell you ahead of time, and lets face it some blatently do nothing. As a buyer in the past I have typically used a buying real estate agent to help me track down candidate properties, perform showings and leg work. As a result I did not close many deals dispite offering near or above asking price. The reason...
The Real Estate carnival has come to town......some want to get off the rides while countless more not so experienced in the roller coaster market want to try their hand at it.
With losses on Wall Street nearing in the trillions one would assume that investors would have learned to test the temperature of the water before diving in. On the contrary, many are jumping in to the fray with little thought like a karaoke singer, having performed a couple of times who suddenly thinks that he will get discovered and become superstar music artist overnight. 
These investors who are new to the game of the real estate market subscribe to the philosophy that everything that goes down will go up again in quick turn around time but being new to throwing in your hand to the poker game of real estate requires thought and precision in regards to timing.
Let's face it, with the real estate market as fragile as it is these days, anyone looking to enter the business of renting has ominous decisions to make in order to turn that property into profit. Every aspiring landlord has to start somewhere, so here are a few of the options - along with some risks and rewards - to consider when buying property with intent to rent: apartments and townhouses, the n-plex, and the single family home.
Apartment buildings and townhouses are viable options when trying to maximize profits in minimal space. This space may be limited by scarcity of land or a high price on the land that is available. The pros of such a setup are somewhat obvious. More units equal more tenants, more tenants equal more rents collected, and profits rise. Typically apartment buildings and townhouses also have the size and means to support a handyman or in-house maintenance. This takes some of the burden of repairs (and a tenant's unhappy wrath) off of the owner. As many landlords could testify, this is worth whatever cost to renovate or build an apartment building or townhouse. But with every pro, there is a con. In this case, the reality of many different people and personalities in a limited space has the inevitability of crossing one another. Lack of privacy, personal property disputes, pets, and children, residents with alcohol or drug related problems and noise complaints are just a few of the possible pitfalls. Though the owner may not necessarily have to deal with these, a reputation for an unpleasant living space is a real estate killer.
The n-plex usually refers to a duplex, but variations such as the 3-plex, 4-plex, and so on do exist. This is considered by many to be one of the higher risk rental options. It stems from the effort of the land owner to either diversify or increase income from a simple dwelling. This option also allows for a bit more personal space for the tenants, as a duplex customarily offers a yard or some outdoor space as well as a garage and more square footage in the home itself. However, the success of an n-plex rests heavily on the compatibility of the (considerably fewer) tenants. If one tenant has a bad experience, the space may be harder to fill, and that is a vacant space the landlord then has to maintain out of pocket. The n-plex has a strange place in the crux of markets. On one hand, people may like the extra space at a little lower cost. On the other, if they are ready for that much space, why not just go and get a single-family home and not have to share the headaches?
