Real Estate Comes Down To The Numbers

Category: Finance, Real Estate.

Real Estate Investing is simple, but not necessarily easy!

It s like telling someone how to drive a car. You see, people can complicate anything! It s not complicated at all. Sit down. Just open the door. Turn the car on and put it into drive.

They start asking thinks like" which door should I open. the left or the right? " or" Do I unlock it with a key or click the button" and on and on we go. But, people always make things harder than they need to be. Twenty minutes later, we ve still not even been able to get into the car. There are really 5 things you need to know- or steps- when it comes to real estate. I liked that analogy because it applies to real estate. Here are your Top 5 Real Estate Investing Tips!

Stop wasting your time trying to make deals out of deals that aren t there. Tip# 1: Find a Motivated Seller. Sellers are motivated to sell a piece of real estate by only 3 things: Change in personal situation. Personal reasons for selling a home are: job loss, relocation, divorce, illness, etc. Sellers become very motivated to sell their properties when things in their personal lives change and they can no longer afford the home or there is an emotional reason for selling. Tip# 2: Evaluate the Deal. Real estate investing comes down to the numbers.

Once you ve found a motivated seller, it s time to decide if the deal is going to work. There are 5 factors to consider in order to decide whether or not to invest in a property. If real estate is located in an area that is full of abandoned properties and rundown houses, the score will be lower than if the house was located in a prime location, close to all of the area amenities. Location. Condition. For instance, a brand new home is going to have a substantially higher score than a property that s rundown and needs major repairs. The better the condition of the property, the higher the score will be.

Price. The goal is to purchase real estate for as little as possible. 30% or more below market value will score much higher than when the seller is asking for market value or better. The lower the price, the better! Financing. If the seller is willing to give you financing with flexible terms and low interest rates and you don t have to come out with any of your own money, it s better than when the seller needs all cash up front. Real estate comes down to the numbers. Seller s Motivation.

The more urgent their situation is, the higher the motivation score. On a scale of 1 to 10, how motivated is the seller to sell his/ her property? Tip# 3: Write an Offer. But before you write your offer, make sure you have 2 exit strategies in place. After you ve done your homework and looked at the numbers, it s time to put the pen to the paper. This way, you re not stuck holding onto a piece of real estate that you can t rent or sell.

Consider submitting 3 contracts on the same property with different prices and terms and let the seller decide what works best for his/ her situation. Many people are losing their shirts in real estate because they jumped in on pre- construction and hoped to" get rich quick" . For instance, you may have a wholesale offer at 50% of market value, a seller financed alternative that you might use for a rental, and a lease option which you might do a sandwich lease- option. Once the seller has agreed to one of your offers, it s time to get the deal closed. Tip# 4: Line Up Your Financing. If you re wholesaling the property, find your investor- buyer.

Also start looking for a tenant or tenant- buyer if you re goal is to build a long term real estate portfolio. If you re going to close on it yourself, line up the financing via a conventional lender, hard money lender or line of credit. The key is to get your financing lined up in accordance to your exit strategy and begin moving immediately. Many real estate investors purchase a piece of property with one plan, buy- fix- sell. Tip# 5: Follow Through with Your Plan. They write the offer based on a certain sale price and with a specific plan to renovate. If you follow these steps and remember the tips, then you will make money in real estate.

Then, once they close on the home, they over- improve and try to sell it for more than it s worth or use a hard money lender and then decide they want to rent it. If you deviate from the plan, then your chances of running into problems increase. Remember, real estate investing is like driving a car. You wind up with the wrong type of financing, you can t find tenants, the holding costs eat the profits, etc. It s simple. Get in, put it in, turn the key drive, and go!

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Buying A Home Is Also A Big Decision

Category: Finance, Real Estate.

Buying a home in El Centro is exciting. It s a great community for new home development.

This family friendly community is welcoming of new comers and neighbors. You ll find some remarkable, affordable new homes in El Centro and throughout the Imperial Valley. In fact, a home purchase usually takes somewhere between 20 and 40% of your gross income. Buying a home is also a big decision. Imagine spending that amount of money on any other single investment. When you decide to purchase a home, the first step should be working with a mortgage agent. It s a lot of pressure, and something you definitely want to get right.

A mortgage agent will help you get ready for the home buying process. Most mortgage agents consider this the pre- approval process. He or she will run a sample credit check to uncover any potential problems, and help you determine how much home you can afford. Some home buyers decide to go a step further when working with a real estate agent, and that is to get prequalified. If the loan looks good, they give you a letter that says you are prequalified for a certain loan amount. With prequalification, the mortgage agent runs through the process as if you were buying a home of a certain amount.

This can be a big advantage when it comes to making an offer for a home- the seller knows that you are able to qualify for the loan amount and the loan should close quickly. When you look for your home there are two people that are essential to the process- a real estate agent and a mortgage agent that you know are trustworthy. Deciding who to work with when you purchase your home in El Centro is also very important. There is a huge difference in how some of the professionals operate within this field. Although you might not realize it, mistakes made by real estate agents and mortgage agents can cost you thousands of dollars, and possibly even lose the sale. You want a real estate agent that listens to you and represents your interests, and you want a mortgage agent that is committed to fining the best mortgage solution for you.

You want to work with professionals you can trust. Imagine having a home in El Centro, without being" house poor" . Not only will you find the best El Centro home, but you ll find the best mortgage package for your finances. When you take the time to become educated about the home buying process and the mortgage process, you ll find the right home and the right mortgage for you.

Purchasing An Existing Florida Home

Category: Finance, Real Estate.

If so, then there are several things that you need to consider.

Also, older homes may have hidden repair and remodeling costs that the buyer has not considered. The tropical climate is one of the benefits of living in Florida, but it does present unique challenges when it comes to buying or building a new home. The educated buyer would do well to take all of these factors into consideration when deciding on whether to purchase an existing home or have a new home built. At this time, there are a flood of existing houses for sale in Florida. Purchasing an existing Florida home. Market conditions now heavily favor the buyer, and many Florida home buyers are looking to take advantage of these conditions by finding a great deal on an existing home. The buyer may think that they are getting a new home at a great price, they could end, but in reality up spending a great deal of additional money before the home is ready for occupancy.

However, buyers must take into consideration some of the repair and remodeling costs that may come with an existing home. Older homes are especially prone to needing costly repairs. Electrical and plumbing systems age, wood frame homes are often susceptible to wood rot and insect infestation, and appliances wear out after years of use. On average, a Florida home begins to require major repair and remodeling after twenty years. Many older homes were built before lead paint restrictions were put into place, or were built without central air conditioning and heat. Building a new Florida home can save you money.

Older furnaces are often unsafe and are expensive to remove, and it is difficult( not to mention costly) to install central heat and air in homes with out- dated electrical systems. Building a brand- new custom home may be more affordable than you think, and will alleviate several of the home buying worries that come with an existing home. There is no need to worry about replacing outdated electrical, air conditioning and, plumbing heating systems. If you consider the fact that you will not have to spend a penny on repairs or remodeling, a brand- new home will likely end up saving you money in the long run. There is no fear of wood rot, water damage or insect infestation. Hurricane protection is another area where you can save money by having a new home built.

Everything is brand- new, and often under warranty. Many existing Florida homes were built before stricter hurricane building codes were put into effect, and even newer homes may not be built to withstand a strong hurricane. These builders use solid concrete construction, additional roof truss straps, and impact resistant glass to provide the highest level of hurricane protection for your home. Today there are home builders in Florida who are offering homes built to withstand a Category 4 hurricane. In addition, these above code homes can save you money on homeowner s insurance premiums. No need to spend time and money on messy remodeling projects.

Many insurance companies offer discounts to homeowners who purchase homes with these protective features. When you decide to have a custom Florida home built, your builder should provide a wide array of style and d�cor options. This means that you get the home you want: a home that reflects your personal taste and style. You choose the floor plan, interior and exterior colors, cabinetry, flooring, and lighting for your custom home. In a brand- new home, floor plans are often more airy and spacious than those found in older existing homes. The homes are usually pre- wired for ceiling fans, and there is, cable and internet an increased number of electrical outlets in every room.

Appliances are up- to- date and top of the line. These are all features that you would likely have to pay to add to an older existing home. Finally, you can save money on a brand- new custom built home by purchasing your home directly from the home builder rather than acquiring a realtor to negotiate your purchase. Purchasing a new home from a builder saves on commission costs. If a home builder does not have to pay a 3- 6% commission to a realtor, they will often pass these savings on to you by reducing the price of the home or adding additional features and upgrades free of charge. It may be much more affordable, not to mention less stressful, to build a high- quality custom home instead. In the long run, purchasing an older existing home, even in the current buyer s market, may cost you more money than you think.

Reassure The Seller Of Your Ability To Close

Category: Finance, Real Estate.

The goal in a real estate negotiation is to reach a good agreement- one in which the underlying interests of both buyer and seller are met. Many of our real estate clients have been experienced negotiators in other industries, and we have learned from their skill and experience.

The results of a poor agreement often return to haunt the parties after closing. Review these tips as you prepare for the purchase of your home. The first step in getting what you need is simply to let the seller know- in a clear and reasoned way. What do you want to achieve in the negotiation? For most people, the highest priority is the price they will pay for the property. Set an offering price range that makes sense. The best way to establish this is by a market analysis of the neighborhood.

Knowing your range allows you to balance the price with other needs. Setting a closing date that meets your time frame. Your interests might include: Buying at the lowest price possible. Settling any repair issues fairly. Locking in an acceptable mortgage loan rate. Having your concerns heard and addressed. Clearing any title or survey issues that come up.

Getting your family settled into a home and neighborhood. Completing your relocation and job change process. Forging a good working relationship with the seller. Is an adversarial or cooperative approach more effective? Having no future problems after closing. Effective negotiation does not result from stubborn demands. Professional negotiators try to preserve the relationship between the principals.

There is nothing more destructive to the negotiation process than combative behavior. The goal is to avoid an impasse in which neither seller's nor buyer's goals are met. Effective negotiators move in the direction of trust as quickly as possible. In many cases, the contract negotiation process begins with some initial distrust between buyer and seller. In preparing your offer, let the marketplace establish your price, while remaining very complimentary of their home. This will always backfire and start the negotiation off with a defensive seller. Buyers sometimes submit a letter to the seller pointing out deficiencies and explaining why their house is not worth what they are asking.

Sellers have an emotional attachment to their home, and will have a strong negative reaction to a critical buyer. You may find that you have to work with a combative seller or agent. How do you handle an adversarial strategy by a seller or agent? Their strategy may include: defensive arguments, snide remarks, emotional statements, threats to terminate, and stated positioning, ego involvement. Good control over your own emotions is critical when working with a combative style negotiator. Creative solutions are difficult to find in this environment.

Here are some pointers: Do not argue. Do not respond emotionally. Arguing will position them more strongly and drag the negotiation off course. An angry or defensive response will escalate the negotiation into a no- win battle. Listen and show that you understand their points. Do not accept or reject their arguments. Accept the fact that strong emotions are present.

They may be a negotiation tactic. Strong emotions arouse fear and anger in others. Avoid an" us- against- them" strategy. Show that your proposals were not been made unreasonably. Attach cover memos to your responses in order to communicate with the seller and break down barriers. Firmly anchor pricing, repair requests and other points to outside data.

Put everything in writing. Be careful not to allow hazy proposals to stand. An emotional negotiator will often produce an unclear agreement. Look for ways to meet their underlying interests. Make your offer as attractive to the seller as possible. Offer some wins on some of the terms.

Do not try to win every point. Face saving is important. Keep your long term goals in mind. Is every point in the contact negotiable? The seller may have a beautiful home that meets your needs. Yes. For example, it is common practice in our area for the seller to pay for the title policy, and buyer to purchase the survey.

However, one of the most effective ways to come to an agreement is to rely on accepted norms when possible. Using consistent standards reduces the need to haggle over every point. By trading off, both parties can come closer to getting what they need. However, every term in a contract can be used to help structure the deal. How do you move in the direction of" trust" ? All parties are under pressure, with future plans at stake. Keep in mind that contract negotiation is a sensitive area, and anxiety can be high.

It is possible that the buyer or seller may have had a previous bad experience. It is not proper to discuss your personal strategy or needs. Acting with integrity does not mean that all cards have to be put on the table. A high level of trust raises the level of cooperation between the parties and forwards the negotiation. Here are ways to develop trust: Listen and understand what the seller has to say. The seller will be much more cooperative if the he feels that the buyer and agent are acting with integrity.

Express appreciation for the seller's home, decorating, gardens. Reassure the seller of your ability to close. Respond within a reasonable time to counter offers. Reveal some personal information about yourselves. Sellers often choose their contract for personal reasons. Finding common ground with the seller can be a very powerful tool in the event of multiple offers.

For example, the buyers reminded them of their own family when they moved in with young children. Or, the new owners would care for their gardens or feed the birds. Or, they were of the same religion. How much leverage do you have? You must know the underlying market condition. A crucial part of your strategy in a negotiation is an accurate perception of the real estate market. If you are in a sellers' market you must act quickly, and be willing to present an offer at the top of the range.

If the seller has multiple offers, you must make your very best offer up front. This is most important if the home is in a hot area and has strong appeal. In a buyers' market your prospective home may have been on the market for months. In this case you have a lot more leverage than you would with a new listing. There may be a small buyer pool for the home because of economic conditions or due to repair or updating needs. Some knowledge of the sellers' needs may help you improve your leverage. It is important to make your offer as straightforward as possible.

If you can meet some of their needs you have gained leverage for a lower price. Contingencies will reduce your leverage for a lower price in a buyer's market, or for any consideration in a seller's market. Here are some possible contract contingencies: Contingent on sale of your home: Usually, the seller will not accept a contingency to find a buyer for your home. Be proactive about showing the seller your desire and ability to close. It is more likely to be accepted if your home is under contract. Contingent on inspections: In our area this is covered by an option period. Attach a copy of the contract and status report.

Keep the option time within accepted norms. Do this only if you are knowledgeable about the property condition. This contingency can be removed to strengthen your offer. Contingent on financing: Strengthen your offer by obtaining credit approval. If you are making a cash offer, get a letter from your banker stating that the resources are available. An approval letter with your offer improves your leverage, and is crucial in multiple offers. How much under list price should you offer?

Establish your price by a market analysis. Unless there is a strong seller's market, buyers usually offer less than list price. It is usually counter- productive to offer so low that the seller will automatically reject the offer. In a recent deal the seller responded to a low offer with an above- list- price counter. This will set a negative tone from the beginning. How are multiple offers handled? They may disclosure to all parties, or disclosure to none, that multiple offers have been received.

The listing agent and seller will decide how they will handle multiple offers. By disclosing that there are multiple offers, the seller is not" shopping your contract. " Shopping occurs when the seller discloses the terms of an offer to induce a buyer to submit a better offer. The standard procedure is to notify each potential buyer that there are multiple offers, and give each a chance to raise his offer by a certain time. This can have a negative result by creating distrust of the process by all parties, and possible loss of the buyers. When all are received, the seller will review the offers and choose one to work with.

Have You Tried Selling Your Home To A Business

Category: Finance, Real Estate.

Like lawyers, real estate agents and realty companies have had many jokes made and told about them due to the shady reputation many of their number have earned for the industry.

So what is a poor homeowner to do when he needs cash fast and wants to sell his house quick? Nowadays, selling your home to these people may seem like entering a den of lions- an unpleasant situation that is not meant for the faint of heart. Fortunately, it is still possible to find honest real estate agents and realty companies out there( believe it or not. ) The problem is just finding them. This is a good way of running through a host of real estate agents and realty companies without ruining your footwear or running up huge gas bills. Here are some tips you may bear in mind when looking for them: Go online. This way, you can examine what they claim to offer at your leisure and you have plenty of time to make comparisons between one website and another. Your home involved a big initial investment on your part when you bought it or had it constructed before so it is only fair that you get a fair price for your home now when you sell it.

This is also a good way to find out what the industry standard is for a home sale these days in your area- particularly if you are interested in selling your home for quick cash. Go through the yellow pages/ business pages of your phone book. It is also safer than the online system because a website owner can easily disappear overnight without a trace while an agent or realtor listed in the phone book probably had a bigger burden of proof to present to the phone company before he/ she could be listed in the business pages. Almost all real estate agents and realty companies in your area will have a landline at their office or home office, so this is a pretty good way to narrow down your search. There is always an element of risk though even with these people in the business pages, so keep your wits about you. This is a pretty good way to sell your home fast for cash, because you never know if your home is well- admired by a friend or a distant relative until you broach the idea of selling it.

Have you tried selling your home to someone in your social circles? If you offer a fair price, someone may see a good deal when they hear of it and give you cash upfront for your home. If you still prefer to go through a real estate agent or realty firm, then ask around about this as well- you might get good reliable referrals to reputable real estate agents and realty firms this way. You could spread the word about your plan to sell your home and the details of your offer by emailing your social contacts, posting a notice on a blogsite or a website you own, or even by asking around the neighborhood and chatting up your neighbors. Have you tried selling your home to a business? For instance, non- profit institutions do not really need traditional buildings to operate from, so your nice home might be appealing to them as a new base of operations.

There are actually some homes that would make good headquarters for certain businesses. You need to check though if this would violate a zoning code of some sort before you sell your home. There are many other ways of selling your home to honest people for quick cash as quickly as possible. And you may still need the help of a realtor specialist with the details of the sale. These are just some of them. This way, you get more money for your asset and the odds are less that you will make a mistake during the sale. The thing to remember though is to hang on for the best deal you can possibly get rather than snatching up the first offer made to you.

Your Real Estate Agent Will Also Be Able To Help You With Pricing

If you are considering selling your house, there are many things that you will need to think about right from the very beginning.

Many people today are taking advantage of the options offered by real estate investors and there are lots of reasons for you to do the same! The decisions you make at the very beginning of the process will affect how easy a time you will have of it by the end, so make sure you think about the options carefully! To understand a little bit about the process of using a real estate investor, you need to know a little bit about what it is these companies do. Instead, they are thinking of it as an investment. The first thing to keep in mind is the fact that they are not interested in your house as a place where they will want to live. A real estate investor buys properties, does some work on them and then resells them later on.

For one thing, they will not be concerned about things like the proximity of schools or jobs. Because of this fact, they are in a very different position than other buyers that you might encounter. If you are selling a family home, this is one thing that many buyers will be concerned with. A real estate investment company on the other hand, will already know about these things when they come to look at your property. They will be looking at the neighborhood, the schools in the area and the bus route. A large difference in the way that a regular buyer and real estate investor will look at your house is that a real estate investor will not be as concerned with repairs, whether superficial or structural.

Because of this, you may spend a great deal more time and money on the house itself before you can consider selling it. Real estate investors tend to have resources on their own in terms of getting repair taken care of, while regular buyers will usually be insistent on you fixing the house yourself before selling it to them. A real estate investor will come to your house to take a look at it, much like any other buyer, but unlike other buyers, you will most likely have an offer within a week. If you are in a hurry to sell due to job relocation or divorce, this may be one of the best options available to you. Someone who makes a career out of buying houses to turn around and sell them will have the funds available and will probably be able to offer you cash up front. This is a process that differs greatly from selling your house in a more traditional way or through a real estate agency. You also may wish to sell your own home without the aid of a real estate agent in order keep the money from a commission.

One reason to sell your house to private buyers might be nostalgia, say if you want to make sure that a family gets into your home after you leave it. A real estate agent will sell your house for the highest possible price, but this may not be as good an idea as it initially seems. The offers you get might also be comparatively low to adjust for the overpricing and then you' re in a situation where you will need to select from a variety of under- priced offers. Overpriced houses stay on the market for quite a while and if speed is an issue, this is the last thing you want. However, a real estate agent will also have access to resources that you will not, and it is important to keep in mind that many real estate agents have quite a bit of expertise to offer in terms of presentation of the house itself. Many people are not sure how much their house may have appreciated in value since they bought it and thus have problems with listing it correctly. Your real estate agent will also be able to help you with pricing.

At the end of the day, the most important thing to do is to find the option that best suits your position. Whether the most important option is getting the house sold quickly, or for the most amount money, make sure that you find the solution that will make your move and your experience as painless as possible.