Archive for July, 2011
July 28th, 2011 -- Posted in Real Estate |
Buying rent to own house is a very beneficial process for the individuals having restrictions on making down payments, limited earnings, and or poor credit scores. This process allows such individuals to purchase homes prior to the fixation of restrictions.
At present, for several U.S. citizens, the dream of home ownership appears to be far beyond imagination. The real estate prices have skyrocketed over the last several years, and currently it’s almost impractical to acquire a home without good finance and mega incomes for compensating a down payment. This is a demoralizing truth for individuals who reside with big or joint families.
Though, in past few years, increasingly popular and equally advantageous alternatives have come up for individuals facing all the difficulties pertaining with home-buying. Hence, buying rent to own house is a viable solution for all these difficulties. This technique of rent to own is also known as lease option or a lease purchase.
The encouraging factor in the process of buying rent to own house is the non-requirement of the eligibility conditions of loan brokers and banks for buying houses. This is because, in such cases, the sellers are real estate investors and hence, more interested in working with the buyers rather than the traditional homeowners selling their house through a realtor and having the buyers use traditional financial institutions.
Due to this, the seller real estate investor mostly accepts a lower down payment then what is required in dealing with a traditional bank or financial institution. These positive aspects of rent to own houses are very tempting for the people who are not able to catch up with the high costs of real estate, or who have encountered events resulting in the temporary lowering of credit scores.
In return, of these benefits, the tenant buyers of the rent to own house have to show flexibility in some other manners. Normally, such buyers are expected of paying costs which are close to, or sometimes even more than the market value of the concerned real estate. There are two reasons for this, they are,
1. The seller real estate investor of the rent to own homes requires rents that are above the market value for covering mortgage on the house.
2. The sellers can give rent credits to the buyers in return of a high monthly rent.
Consider the instance of an individual buying a home worth $300,000 with a monthly mortgage of $2,200, and the owner desires to sell it. However, many other houses are also on sale in the same vicinity with a few priced at comparatively lower prices. At such times, the home seller real estate investor decides to sell the property rent to own to a tenant buyer quickly, instead of selling it much slower traditionally waiting for buyer with a pre approval for a mortgage and realtor in hand .
The creative procedure of buying rent to own house is day by day becoming more popular. This is due to the “Win-Win” factors present in such procedures. Here, the buyers are able to acquire a home with restricted money and finance, and the sellers are able to attain a fair price for their residence with a swift transaction.
July 25th, 2011 -- Posted in Real Estate |
Securing commercial real estate financing can be a difficult task if you’re not familiar with the field. First, let’s distinguish between residential and commercial. Residential properties are solely for housing people. The location can have up to four units. Five or more units, and just about anything not intended for habitation, qualifies as commercial.
With that clear, let’s discuss the actual financing. Acquiring money, and how much you are allowed to borrow, is affected by a number of factors.
When analyzing an investment plan, lenders consider the following:
* The borrower’s credit rating
* The net income of the venture
* The laws and demographics of the area
* The kind and number of tenants.
These are not the only things lenders consider, but these can give you an idea of how much planning and research you need to do. We’ll address these as the most immediate concerns that you can also investigate on your own.
Commercials all over television talk about a person’s credit rating. This very important number controls your financing life and future. Basically, the higher the rating, the more likely lenders are to give you a larger loan with a decent interest rate. For them, a good rating indicates not only your ability to pay, but your level of responsibility to your debtors. If you have a median rating, you may have to begin with a smaller venture so that you can get a reasonable loan and interest rate.
In addition to the credit rating, but far more important a consideration in commercial property, is the net income of the venture. Financiers want to see that the venture will allow you to pay the mortgage due each month. A proposal that does not clearly indicate profits enough to cover expenses and loan payments is not likely to receive funds. It is important that you investigate this before proposing a venture to a lender. Make sure you account for all of the expenses (repairs, maintenance, etc.) before presenting your net income on the property.
Consider the laws and demographics of the area because the finance agency will. If laws are going to restrict the productivity of your venture, lenders may be reluctant to provide a loan. The same is true of demographics and the economic climate of the location. If the population is low or isn’t likely to patronize your business, again, that can effect whether or not you get funding. Also, the economic activity of the area influences financial decisions. If there is a boom, your chances increase. Let’s say the area is a money drain, or in an escalating slump. It will be harder to justify commercial real estate financing in those kinds of conditions.
Also look at your tenants. For example, if you’re proposing to open a health food store in a strip property that has several fast food tenants, then your business’s chances of success are much lower. If, for instance, you open the same kind of store in a strip with a gym, yoga studio and health spa as tenants, the likelihood of getting frequent customers is increased. Lending institutions take these sorts of things into consideration because they influence the profitability of your venture.
These are not the only considerations, but they are easy to check into and can help you decide if a particular venture is worth your time and the work involved in securing commercial real estate financing. Make sure you do your homework first, and securing funds for your venture will be an easier process.
July 22nd, 2011 -- Posted in Real Estate |
The capital and the largest city of the Republic of Indonesia, Jakarta is situated on the northwest coast of the Java Island. With more than 300 ethnic groups speaking different languages, Jakarta boasts of a diverse culture, linguistic, and religious traditions.
A special territory with the status of a province, Jakarta is the center of government, trade, and commerce in the country. Further, its strategic location makes it the principal gateway to other parts of the country. Apart from its amazing tourist destinations such as Merdeka Square, Sunda Kelapa Port, Chinatown, Kebun Binatang Ragunan, the National Museum, and several restored colonial period buildings – Jakarta also boasts of a vibrant nightlife and shopping facilities. Above all, Jakarta is a city of contrasts, blending traditional and modern and the rich and the poor.
With these umpteen attractions, Jakarta serves as an entry point for many tourists and business people. Its rapid growth into a bustling, modern metropolitan city has led to fast development in the economic, industrial, political, and social sectors of the country. In recent years, the city has expanded its facilities to include a plethora of world-class hotels and resorts, most sophisticated apartments and villas, exotic restaurants, and modern shopping malls.
Hence, it is no wonder that why many people, including westerners, prefer to stay here and carry out their business activities. This in turn has led to an increased demand for both residential and commercial real estate in Jakarta.
In other words, since many foreigners flock to the city not only to experience its tourist attractions but also to stay here as well as conduct their core business functions, the demand for commercial real estate in Jakarta has increased than even before. The demand for commercial property in the city is further driven by the growing number of financial institutions and accounting and law firms. Apart from foreign investors, a large number of local companies and organizations also now invest in commercial spaces in Jakarta.
Different types of commercial real estate are available in Jakarta according to the preferences of investors. One of the most preferred commercial spaces here is flex commercial properties, which are a blend of office and industrial properties. This type of commercial spaces are mostly used for laboratorial set ups or research purposes.
Another popular category of commercial property is niche commercial spaces, which is especially designed for storage purposes or for doctors as well as other healthcare professionals. Commercial real estate in Jakarta also include infrastructure type properties that are suitable for set ups such as hospitals, schools, and municipal buildings. In addition, commercial properties are available for selling apparels, electronic items, and other consumer products. In short, Jakarta’s commercial real estate includes everything from offices, retail stores, and shopping malls to restaurants, factories, and industrial parks.
Investing in Jakarta commercial properties can fetch you a host of benefits. High yield income and secured as well as stable long term cash flow are just few among them. Further, there is considerable savings in maintenance cost, since it is the responsibility of tenants to maintain the commercial property.
However, the Indonesian government has imposed certain restrictions for foreigners to invest in real estate in the country. In other words, foreigners cannot have their own freehold property in Jakarta. Land tenure in the country has been categorized into certified property and uncertified property. Certified land procedures are recorded with the office of the National Land Agency. In most cases, almost all commercial as well as residential properties are built on certificate land. According to the Basic Agraria Law, foreigners can invest in commercial property through certain ways, such as through an Indonesian nominee or a PMA (Penanaman Modal Asing) company.
No matter you want to invest in any kind of commercial real estate in Jakarta, a lot number of realtors and property builders are in the scenario to provide world-class services in order to assist you in finding a property that go with your business needs. Many of them offer superb services to deal with the daunting laws and procedures in connection with the acquisition of property in the city, while some even provide the assistance of an expert lawyer or consultant to verify the documents related to commercial real estate. Above all, there are also realtors arranging mortgages for the acquisition of commercial property in the city.
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July 19th, 2011 -- Posted in Real Estate |
The look of a house really gets changed post home improvements. Hence, a lot of people choose to go in for home improvements in preparation for a major event. It could be a birthday, or festival, or maybe a wedding. In fact, weddings are usually a great excuse to give your house a makeover. While other smaller festivals warrant smaller improvements like maybe changing the curtains or getting new sofas, an occasion as huge as a wedding may be worth much greater improvements. This could range from getting a paint job done to changing the bathroom furnishings to swanking up the kitchen to changing the plumbing.
Home improvements are a great way to alter the look of your home. If you are finally being able to afford the changes that you always wanted to get done, you might want to do up your home according to Feng Shui rules. Apart from having a house which looks wonderful, effecting home improvements could also be adding to your future. Given that most people buy houses because of the investment potential, having home improvements done would help you get a better price on your property, if there arose a need to sell it. So investment-wise also, home improvements are a good idea.
The question that now arises is: How much can you afford? Depending on the amount of savings that you have collected, you could decide to tone down on the renovations that are currently on your list. At the same time, if you have been wishing for full-fledged renovations, you could go in for a home improvement loan. Although these loans are relatively new entrants in the loan market, they have become extremely popular. Thus, more and more people have begun to avail of home improvement loans to pay for their renovation costs in preparation for the wedding day.
There are two basic kinds of such loans. They may be secured homeowner loans or unsecured loans. Most people go in for secured homeowner loans because these loans are a great deal cheaper. Because of the presence of collateral in the deal, lenders are more willing to take a risk by offering borrowers more competitive prices and rates. If you are looking for a cheap loan, it is best to look at the secured variety of home improvement loans.
However, if you are feeling uneasy about placing your property as collateral for the loan, it would be more sensible to seek out some unsecured loans to fund your home improvement needs. The great thing about these loans is that if you are unable to repay a loan, at least you will not be risking your property. The best bargains may be found in the case of secured loans, but this does not mean that all unsecured loans are unnecessarily expensive. Some great deals can be unearthed if you do a lot of shopping.
If you are at sea regarding where you should be looking, you could try the Internet as you start out. You could, in fact, make use of a website that is designed to allow you to make a number of comparisons.
July 16th, 2011 -- Posted in Real Estate |
In the long-term property prices tend to move in an upward trend with occasional stagnation and downturns along the way. There are times when asking prices are sky high and other times when they are slightly lower. However, what a lot of people don’t realise is this is equally true in a shorter time frame, and there are times of the year that are better than others for buying and selling a home.
Let’s start by looking at the best time of the year to buy a property. Obviously if you’re looking for a potential property, then you obviously want to get the lowest price possible. Therefore the best time of the year to buy is when the market is at it’s most quietest, ie when there are less potential buyers out there looking and competing for properties.
If there are fewer viewers looking at properties then there will obviously be fewer people bidding for them which means you are more likely to be able to get an offer accepted well below the asking price.
So when are the best times to buy?
Well the market is significantly quieter during the winter months, particularly during December and January so this is an excellent time to buy.
There are generally slightly fewer properties on the market at this time, but if you do see a house you like, then you are more likely to be able to pick up a bargain.
Another good time to buy, but to a slightly lesser extent, is during the holiday season, ie late July through to the end of August, when most potential buyers take a rest from looking at properties to concentrate on their holidays. In general though the winter months are the best time to buy.
Now let’s look at the best times of the year to sell a home. Here we are obviously looking to receive the best price possible so we ideally want to put the house on the market when the market is most buoyant, so there are lots of people viewing and competing for properties, which drives the prices higher.
After the lull of the winter months, the market tends to pick up again from March onwards, so this is the time when you should be thinking about putting your house up for sale. In general, the spring and summer months up until the holiday season starts are the best times to sell because this is when the buyers are out in force and competing hard with each other.
This is good news for you as you can often set your asking price a little bit higher than the true market value knowing that there’s a good chance that people will pay a slight premium and pay at or close to a higher asking price in order to fight off any other potential buyers.
The next best time to sell your house is during the autumn months when the kids are back at school and the holiday season is over, but the only problem is that if you don’t sell during this time, you have to try and find a buyer and get a good price in the long winter months when the market is quieter.
So to conclude, if you’re looking to buy then the best time to do so is during the winter months and late summer, and if you’re looking to sell then you should have your home on the market during the spring and summer months if you want to achieve a higher asking price.
Incoming search terms:
- when are the best months to sell a house
July 12th, 2011 -- Posted in Real Estate |
Residential investment property is how an overwhelming majority of the world’s millionaires made their millions. Think about it – it’s a demand that’s always going to be there, no matter how the market changes. There’s only so much land in the world, and everybody needs somewhere to live!
This is an investment that carries a low risk, not like investing in commercial property where you have to worry about the business doing well or badly. In addition, investment property loans are not as hard to get as other types. There are lots of benefits that come with residential real estate investing.
Before dropping a single penny, or even shopping around, you should talk to others who have invested in residential real estate. Find someone who has done it before, and use them as your source of information. You can also check out real estate investing forums to get advice.
Don’t go to a bank for advice. This is a mistake lots of first-time investors make. The bank has a vested interest, and they won’t give you impartial advice that is beneficial to you, the investor.
With residential real estate investing, it is all about protecting your venture. You want to buy properties at a low price that you can eventually sell high. Look for properties to buy that are undervalued within their market.
How do you know if a property is undervalued? The best way is by looking around the neighborhood and comparing prices. A little bit of research on the specific area will go a long way toward getting you a good deal on an undervalued site.
Look for houses that have been on the market for a while. This is another great way to find something at a lower price than it is worth. Also, look for sellers that are looking to sell quickly. This will give you some leverage when negotiating.
When getting investment property loans, look for low interest loans. This way, you will be making smaller payments and keeping much more of the cash flow that comes in from your rental properties.
No matter how low the price, always negotiate. You may be able to save a little bit initially, and that can make your investment more valuable. Remember, it is all about the money!
If you are renting out your residential investment property, get familiar with landlords’ and tenants’ rights in your state and city. Also, make sure that the lease is as specific as possible, and clearly states rent charges, late fees, deposits, and everything else regarding money from your tenants. If there should be a conflict that goes to court, this will save your neck.
If you decide to renovate your property, do it according to current trends and not your specific tastes. Remember that this is an investment. You don’t want your quirky decorating ideas to potentially lower the value.
Always keep an eye on your budget. If you go overboard and can’t hang on to your residential property, it’s all for nothing!
The best thing is to do your homework. The more you know about the market, the better able you will be to find a good investment. Real estate investing is an area where knowledge really is power. Give yourself a college education in residential real estate investing!
July 9th, 2011 -- Posted in Real Estate |
The idea of real estate and property is much more than just finding a home. There are categories of homes and business properties as well as divisions in the types of real estate that are available to others. If you want to make a different type of investment in something that you know you can make a profit out of, such as a home in Malibu, then knowing the different types of real estate investments can help.
Real estate investments begin with two major types; business and residential. Each of these has specific guidelines set with them which will make a difference in the functions of the real estate. After you have determined what type of real estate you will be looking at, you can divide up what is available to you.
If you are looking at pure residential areas, then the real estate will be divided by the size of the home. Typically, this will be known as a single family or multi-family home. If you are looking at a multi-family unit, you can expect to have neighbors sharing the same wall as you, such as condos or town homes. A single family home will be completely independent and will usually be shaped differently because the neighbors can’t cross the yard.
Business real estate is also divided into several categories. These will also often be referred to as commercial properties, and will range from office buildings to manufacturing sites. The difference between a business building and a residential building is that it will change the approach towards regulations. Most likely, there will be zoning rules and the lease will have different divisions for things such as taxes and insurance.
If you are in the right area, you might have the opportunity to have both a commercial and residential area in one. Things such as land investments or areas that have been zoned for commercial purposes may have these types of regulations. With this, you can also consider renting a property. If you want to have a business from home or want to expand into a business, this might be something to consider.
The investment that you decide to make can be more than your home. It can also be something that will bring you back profit for the investment. If you are interested in finding a space that is much more than cozy, than knowing the different types of real estate to invest in is the place to begin.
July 2nd, 2011 -- Posted in Real Estate |
Ever wonder how much your house is worth, but is overwhelmed by the process? Don’t worry, you’re not alone.
I’ve gotten the exact question so many times, that I’ve decided to answer the question as thoroughly and completely as possible.
The easiest way to figure out the value is to check the “comps” — or comparable properties that have sold recently. That is- how much have similar (comparable) homes sold for recently?
One great resource is Zillow.Com- it’s a great site to check what homes have sold recently, and Zillow.Com will even give you their own “guess” as to what the property is worth, even show you an aerial picture.
But be careful- DON’T TRUST ZILLOW’S VALUE! Just use them to tell you what other homes have sold for recently. If there are plenty of sales, all within a particular price range, then apply this little formula:
Comps Formula
1. Houses that have sold within 1 year
2. Houses that are within 20% of the same square footage
Now simply average the remaining sales, and voila- you have your comparable value! Now, without actually seeing the “comparable” houses, you don’t know if it’s actually comparable- you’ll have to go look to be absolutely sure, but this is a simple “guideline” price.
If you have a property where the comps vary in value by a LOT, you have to do one additional step. Here’s the breakdown of how to determine the value of a property with values all over the map (like the one you’re dealing with).
First, get a list of recent sales within 1 mile of the subject property. Here’s one I pulled from zillow for a student’s property. It might be a little over a mile, I had to guess from looking at a map):
The result:
XXX Leeward Ln 3 2.0 1,386, 1969 SF 09/01/1992
968 Leeward Ln $32,752, 3 2.0 1,386 — 1981 SF 10/05/2006
9393 Windy Ct $110,700, 3 2.0 1,922 — 1976 SF 12/28/2006
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
767 Four Winds Ln $114,600, 3 2.0 750 — 2000 SF 01/12/2007
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006
Ok, so now, you have to eliminate anything more than 20% bigger or smaller than the subject property. That means, for this 1386sf example, 1,108 – 1,663 square feet are the comps.
So that leaves:
The result:
XXX Leeward Ln 3 2.0 1,386 — 1969 SF 09/01/1992
968 Leeward Ln $32,752, 3 2.0 1,386 — 1981 SF 10/05/2006
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006
9530 Autumn Ct $105,900, 3 2.0 1,536 — 1986 SF 02/05/2007
9274 Brown Rd $235,975, 3 1.0 1,414 766,656 1953 SF 02/21/2007
From 21 properties, now we’re down to eleven. Now, take the highest and the lowest sales price, and eliminate them. That means the $32,752 sale and the $235,975 sale are gone, so we’re left with:
The result:
XXX Leeward Ln 3 2.0 1,386 — 1969 SF 09/01/1992
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006
9530 Autumn Ct $105,900, 3 2.0 1,536 — 1986 SF 02/05/2007
9583 Briar Creek Ln $132,000, 3 2.0 1,408 — 1983 SF 01/26/2007
9581 Washington Cir $161,600, 4 2.5 1,140 — 1999 SF 02/05/2007
Now, two things need to happen. First, average all of these, and you’ll have a pretty good estimate of value. In fact, this is just about how an appraiser would start.
Average Sales Price: $126,500
Second thing that needs to happen now, is you would need to go look at the so-called comps, and see if they are actually comparable. That’s what an appraiser would do.
Now, for purposes of knowing whether or not to follow up on a deal, you don’t have to do that. Just run the comps, + or – 20%, knock off the highest and the lowest, and average them.
But, once you decide to do a particular deal, AFTER you sign up the deal with the seller, while you’re still in the neighborhood, go look at those addresses and decide which are true comps.
So, let’s imagine that Sedgwick Dr, Castlebrook Dr and Washington Cir are NOT comparable because they are much newer, built in the last 8 years instead of 1969 like the subject property.
Then the average value of the older homes, once those three are removed, would be:
The result:
XXX Leeward Ln 3 2.0 1,386 — 1969 SF 09/01/1992
9396 Ridgewood Ter $120,000, 3 2.0 1,640 — 1986 SF 09/21/2006
9429 Citrus Ct $102,000, 3 2.0 1,515 — 1985 SF 01/30/2007
9479 Bywood Ct $86,000, 3 2.0 1,484 — 1986 SF 12/14/2006
9530 Autumn Ct $105,900, 3 2.0 1,536 — 1986 SF 02/05/2007
9583 Briar Creek Ln $132,000, 3 2.0 1,408 — 1983 SF 01/26/2007
823 Four Winds Ln $120,000, 3 2.0 1,594 — 1984 SF 01/03/2007
Average Value (Eliminating Newer Homes): $110,983
Of course, that last example is a hypothetical, you won’t know until you go and look, but you can do just the true “comps search” FIRST, just to see if there’s any reason to even get involved.
Jason Loucks, following conventional wisdom, built up a significant portfolio of rental properties, and very quickly mastered the art and science of retailing properties for Cash NOW through his 7 Day Sale Guy system.