All Forum Posts by: Cole Simpson

Daily Inquirer!

Why Rental Properties?

When it comes to investing, twenty-somethings should prioritize rental properties. Rental properties, in addition to being essentially inflation-proof, also improve in value over time. The longer you own a home, the more likely you are to profit from a future sale.

While property appreciation (the difference between the purchase and selling prices) is a fantastic reason to invest in rental properties, cash flow is one of the most important benefits. Having rental property raises the average monthly passive income you can earn.

Rental payments rise with inflation and cost of living rates, increasing cash flow over time.

Know Your Financing Options

Obtaining funding in your twenties is sometimes easier than doing it later in life. Unless you went insane in your youth, your debt-to-income ratio is probably lower than it would be later in life. If you wait another ten years, your credit is likely to have fewer blemishes and anomalies.

Take the Time to Find the Right Deal

Investing in real estate early in life provides you with an opportunity that you will not have later in life. You can devote time to researching the market and learning the ins and outs of the business. It also allows you to feel less stressed while making purchases because you aren't in a haste to retire. This means you can be picky—if something doesn't feel quite right, go away and keep looking.

Did you start in your 20s?

Daily Dose!

5 Keys To Profitable Rentals:

1) Every Communication Counts

Keep in mind that early communications shape the tenant's perception of the landlord. It's difficult to recoup if the tenant develops reservations. The rental ad, the initial phone call or meeting, and the rental application must all set the tone for clear, effective communication that portrays the landlord as competent and in command.

2) Keep Everything in Writing

A written lease agreement is required. While verbal leases are nonetheless legally binding in many circumstances, they are much more likely to cause a disagreement. To avoid future misunderstandings, the written lease should require all further amendments to be made in writing.

3) Be Clear with the Rules

Tenants must first grasp the rules in order to follow them. Tenants must understand what they may and cannot do, as well as who is responsible for routine maintenance and repairs. These guidelines must be explained in plain English rather than legalese. Before offering a lease or house rules list to a tenant, it's a good idea to have a neutral person read them.

4) Ongoing Contact is a Must

Maintain contact with the tenant during the lease period. This should entail a few routine inspections, but it can also be a "virtual" presence, such as a monthly newsletter or even emailing or sending a rent receipt. When the landlord appears to have vanished, the tenant is more prone to break the rules.

5) Keep Records of all Interactions

Make a record of all interactions in the tenant file, including rent transactions, phone talks, and repair requests and completions. Landlords may minimize the uncertainty that all too frequently leads to an expensive tenant dispute by communicating clearly and effectively.

What else do you think?!

In real estate investing, the 1% rule compares the price of an investment property to the gross revenue it will earn. The 1% rule states that a potential investment's monthly rent must be equal to or less than 1% of the purchase price.

Consider the following scenario for a home worth $200,000:

$200,000 x 0.01 = $2,000

Using the 1% guideline, you should look for a mortgage with a monthly payment of $2,000 or less and charge your tenants a $2,000 minimum monthly rent.

Let's say the house needed roughly $10,000 in repairs. In this case, you would add the cost of repairs to the home's purchase price, bringing the total to $210,000. Then you'd multiply the total by 1% to achieve a $2,100 minimum monthly payment.

If you're looking to buy an investment property, the 1% rule can help you identify the ideal property to meet your financial objectives. You can use it to rapidly determine how the property will cash flow, or you can use it to help set monthly rent if the property is currently unoccupied.

It's vital to keep in mind that this is merely a guideline. It's a fine place to start, but when choosing how much rent to charge your tenants, other considerations must be considered.

What other considerations can you add?

Revenue Share is where a brokerage shares its earnings with its agents for helping to grow the company. This is a win-win because the broker can pay agents rather than spend money on advertising to grow the business. This is a great way to retain and reward agents!

Generally, revenue share is paid from the brokerage to the agents based on the gross commission income earned by agents you introduce to the company.

Now, the real power of Rev-share is that:

1. There is no limit to how many agents you can introduce and the revenue share you can earn.

2. Attracting agents isn't limited to your local area: agents you introduce can be located anywhere in the USA!

3. If agents you introduced also introduce agents, you can receive a revenue share for up to seven tiers of agents - and you didn't even do any work to introduce those agents!

The true power of revenue share comes into play when the agents you introduce start bringing other agents to the brokerage and so on. Your workplace goes down while your income goes up! Think about the rev share of agents that are already directly responsible for hundreds of agents coming to the brokerage!

What are your thoughts?

This simple real estate business hack is your key to financial independence and early retirement.⁣
⁣
If you had the potential to replace your annual commission income simply by showing a better brokerage model to some real estate agents you already know, would you do it? Or would you keep slugging away closing transactions to put food on the table until you keel over for good?⁣
⁣
The biggest hurdles for successful real estate agents aren’t the transactions, the lead generation, or even the difficulties of some clients. The most difficult thing to achieve as a real estate agent is…retirement. It’s time to discover how the power of revenue share can help real estate agents retire – and as quickly as they want.⁣

Now, what is Revenue share? 

Let's talk about that in my next post!

This common side hustle attracts many who are looking to make money off existing assets in their home. ⁣
⁣
About half, 54%, of those who own their own home say they’d consider renting it out through a service like Airbnb, according to a recent survey of 1,000 people by real estate data company Clever. And 82% believe this is a good money-making strategy.⁣
⁣
Airbnb hosts in Charlotte make, on average, about $924 a month, according to research from low-interest lender Earnest. Of course, that income can vary dramatically depending on where you’re based, how frequently you rent out your place, the quality of your home, and the services you provide.⁣

What are your thoughts?

Society is becoming increasingly dependent on credit to make purchases and financial decisions. A good credit score is used for more than just getting a credit card or a loan. ⁣
⁣
Due to people extending themselves beyond their means, many people are not able to pay their debts. At the same time, general living expenses take a toll on people's paychecks. Businesses have good reason to insist you have good credit before providing products or services on credit.⁣
⁣
Some employers are even beginning to run credit checks to see if you can be trusted with company finances or assets. If you have a history of not being financially responsible, you may run into problems finding work.⁣

Here are 5 smart tips to get a loan with bad credit:

Improve your credit score by focusing on the factors with the most impact such as your payments and credit history.

Know where your finances stand. Check your credit report and credit score.

Shop around with different lenders to compare your options.

Seek out a trusted person in your life who is willing to co-sign on your behalf.

Consider a peer-to-peer loan. Borrowers can get an affordable loan with these lenders.

There could be multiple reasons your house is not selling, but the important thing is to always have contingency plans because you never know what's going to happen.
What do you do when your exit strategy doesn't work?

It goes without saying that your 20s come with lots of new things; new friends, new experiences, new perspectives, and new legal allowances.

There’s no denying that having money or not having it comes with a lot of emotion. When we have it we’re happy (and often irrational), and when we don’t we’re sad. With each emotion come behaviors that can make or break our financial stability for the future. Many a divorce, bankruptcy, and heart attack have been attributed to the stress that people feel around money that could have easily been avoided.

Your twenties are a mixed bag full of fun experiences and new opportunities for growth. But if you can find a way to incorporate common financial sense, you’ll not only thank yourself later but even be able to afford to buy yourself an expensive treat!

A quality credit score is one of the most valuable assets a real estate investor can have. ⁣
⁣
This resource has the authority to not only retain attractive mortgage and refinancing rates but amplify an investor’s negotiating power when seeking a loan. While a lower score will not automatically disqualify potential investors, this all-important number in residential redevelopment could hinder one’s ability to access certain loan programs.⁣
⁣
People with subprime credit may face financial barriers to homeownership, making it difficult for their dream home to become a reality⁣.

Here are five things to remember if you want an excellent credit score:

Pay bills on time

Keep the amount owed under 30% of the limit

The longer your credit history, the better

Multiple credit inquiries can lower your score

Variety in types of credit can boost your score

I would love to hear your thoughts on this!