Showing properties to potential buyers or renters can be quite challenging. The property manager and the interested party may have trouble getting their schedules to line up, the consumer may feel less comfortable with someone else constantly hanging around, among other reasons. The answer: perhaps a self-showing lockbox.
The self-showing lockboxes eliminate the need for a property manager to be present. Tenants or buyers can look at the property whenever their schedule permits. If they work odd hours, they could still look at a home. The advantages don’t end with the consumer. Without anyone there to show the home, property managers won’t be in a potentially dangerous position with clients. They can also program the boxes to only work at certain times. It really seems to be an improvement for everyone involved, but what’s the risk?
Unfortunately, a system like this involves a bit of trust. There have been incidents where less honest people get a copy of the key made and “rent” the property to unknowing tenants. Since their “landlord” was not the rightful owner of the property, these tenants can then be charged criminally for trespassing and/or are evicted. People will also steal from these homes, leave lights on or windows open, and generally mistreat the property. There are also issues concerning liability.
These lockboxes could be the future, but property managers will need to carefully weigh the risks in their decision.
New technology in key lockboxes offers opportunity, but potentially new risks as well.
Key Points:
1. “Smart Lock Boxes” allows a prospective tenant or buyer to enter and view a vacant property without the manager present.
2. Rental properties tend to rent more quickly with self-showing programs.
3. Only rightful landlords can legally rent property.
Quicker rentals mean shorter vacancy losses; just as more showings mean more potential buyers making offers to purchase, both big pluses.
New technology in key lockboxes offers opportunity, but potentially new risks as well. Learn more.
Lockboxes containing the key to a building or property is not a new item in real estate. What is changing is how those lockboxes function. New technology links the lockbox to the Internet, and can even take programming for who or when it will allow access to the key inside, and thus more precisely control access to the property. But the “smart” or self-showing lockboxes carry 21st Century risks along with their 21st Century options. Don’t get caught off guard; stay informed.
See the original at: https://thinkrealty.com/self-showing-lockboxes-whats-risk/
Investor’s Guide To Buying A House At Auction
When someone thinks of an auction they start to panic and worry. But for the most part buying a home in an auction is no more stress than buying a home from a real estate agent. If you do it right, then you can end up with an amazing deal.
Most auctions take place at the courthouse and always start with a minimum bid based off of what is owed on the property. Since the property is usually owned by the government or a bank, if that bid is not met then they can decide to hold the property until another time which it will go back up for auction. Buyers go through a normal bidding process and as long as the initial minimum is met, then they take the home. They must pay via a certified or cashiers check within a certain time frame and then then home belongs to them via verified paperwork. Titles will be sent out within 10 days, but no less.
The reasons home go to auction is simply when owners fail to pay several months of payments then the banks go back to reclaim the home, this becomes a foreclosure. Another type of auction is one where the owner has not paid or owes a lot in taxes, this is considered a tax lien. There are always risks with these properties as you’re buying it site unseen, the home can be damaged, require lots of repair, but if you play it right then you can get a home at a great value and in turn own several great deal homes.
Now you want to take part, to take part in these auctions you need to register, once registered you'll have access to homes that are available via auction. You must do your own research ahead of time to understand the area, the market, and what you're getting into. To show your serious you also must put down at least 5% as a deposit. Make sure the schedule is accurate, when you're ready to bid, just like the shows you watch, raise your card to signal your bid at the price announced. These type of homes can be purchased via many means, including FHA loan, don't be scared away if you're a first time buyer. Just make sure you do your research to prepare yourself for what you're getting into.
If you do this right you can walk out ahead and with a great home in your possession.
Don’t let fear of the unknown scare you away from real estate investment; learn and profit!
Key Points:
1. It’s not a traditional way of buying an investment property which means fewer people to compete with for the deal.
2. Even first time home buyers can buy at auction with a mortgage they just need to do more research.
3. You can save up to 30% of list price from buying at auction, meaning you can either just save money or improve the house you can purchase while staying in budget.
From an investor’s point of view, foreclosure and lien auctions offer the opportunity to invest in one or more of these properties at a low price. After some work, they can then sell or rent those properties for income.
Don’t let fear of the unknown scare you away from real estate investment; learn and profit!
Buying property can be a big decision that’s scary, but buying it for investing purposes can be even more daunting. Don’t let that fear put you off from stepping into the ability to leverage your money to work for you. Houses being auctioned off are a great starting point that can be low cost, as long as you proceed carefully and keep your eyes open for the right deal that suits your needs.
See the original at: https://www.fortunebuilders.com/real-estate-auction-process/
Report: Tax Law Changes Affecting Home Sales
The new 2017 US tax code could be to blame for the downturn of the housing market. Data shows that the housing market has slowed significantly in recent months and many attribute that to the caps on homeowners’ deductions in the new tax code. In addition, interest rate hikes have also scared homebuyers off.
Some experts say the new tax code is really only negatively impacting the market of high-end homes, while pushing homeowners to choose more tax-friendly locations instead. With the tax code capping deductions of state and local taxes at $10,000 and instating a $750,000 limit on deductible mortgage debt, homebuyers and potential homebuyers are fleeing high tax areas, such as New York, Chicago, Denver and Washington, in favor of places like Florida where there is no state income tax.
Recent data shows that the home market could be on the rebound. February saw that biggest month-over-month gain since December of 2015 and median home prices of increased by as much as 3.6 percent. Some could attribute this to wealthy potential homebuyers looking in locations, such as Florida, for their next home instead of more pricey locales. This could be creating a new problem down the road, however, by driving up the price and demand on mid-to-low end housing areas.
Key Points:
1. Tax reform has increased interest and taxes as well as capping the mortgage deduction related to buying property.
2. Fewer people have been buying “high end” real estate because it has become too expensive.
3. People are moving to lower taxed or no taxed places such as Florida to avoid this.
The expensive home market will experience challenges due to the curtailment of tax deductions of mortgage interest payments and property taxes.
Buying and selling homes is already expensive. This tax law change is not a good idea.
When you’re investing the kind of money required to purchase and manage property, tax benefits become essential. For example, the Federal Reserve in New York concluded that tax code changes in 2017, which capped some real estate deductions, resulted in reducing the volume of housing sales. Don’t get caught off guard; make sure you’re aware of not just current tax provisions, but what might be coming, and plan accordingly so your money continues to work for you.
See the original at: https://thinkrealty.com/report-tax-law-changes-affecting-home-sales/
When neighborhoods begin to decline, they get gentrified, which is when low-value properties are renovated. New homeowners move into the area and quickly change it’s makeup. Landlords should adapt their strategies for this. While most think of gentrification as a negative thing, some new studies have shown benefits of gentrification, for both landlords and renters. As new, more affluent people move in, property values go up for current renters. Property owners in gentrifying areas must be honest about their own property compared to others, and recognize if they need to renovate to attract new renters.
When an area is gentrifying the local market can change quickly. Landlords must decide whether or not they need to totally redo their property or just fix a few things. Remodeling can allow you to charge higher rates, but it will have a high initial cost. And you can’t always count on new businesses or stores to come in unless pushed for by locals. Landlords must also keep in mind as an area improves, property taxes are likely to increase to pay for new services such as expanded fire and police.
The biggest difficulty for landlords will be dealing with existing tenants, who may be nervous about the changes or if they will have higher rents in the future. Landlords should make sure current tenants are assured they will not be affected by new tenants. Gentrification brings many changes as challenges, and needs to be dealt with thoughtfully. Real Property Management understand the risks and rewards of this process and can work with property owners on the best approach for their neighborhood.
Don’t be content with a low value real estate portfolio; renovate it and boost profits.
Key Points:
1. Gentrification brings several new challenges to property owners.
2. Gentrification can bring positive changes to property owners in the form of increased city services and increasing property values.
3. Tenant relationships and staying ahead of the curve will ensure you can take advantage of gentrification.
Adapting to the changes is usually the best business strategy for landlords.
Don’t be content with a low value real estate portfolio; renovate it and boost profits
Apart from cleaning and keeping everything tidy, one of the best ways to boost the value of a building or real estate holding is through renovations. When new additions are made, when existing structures or facilities are updated and modernized in both function and decor, it enhances the property’s value with potential buyers. Whether it’s a cosmetic remodeling or a deeper and more intensive renovation, you can turn pennies into dollars with the right updates to your portfolio.
Your thoughts?
See the original at: https://thinkrealty.com/taking-low-value-property-new-heights/
How To Use A HELOC On Investment Property
A HELOC, or Home Equity Line Of Credit, is somewhat like a mortgage or a home equity loan. The difference between a mortgage and a HELOC is that while a mortgage is a loan for a fixed amount, a HELOC is a guarantee of a loan that can go up to a maximum amount. Also, while a mortgage is lend to the borrower at a set date, a HELOC can be borrowed from at a time or times of the borrower's choosing.
HELOCs have a number of benefits. For example, a borrower who owns rental properties can use funds from the HELOC to improve the rental properties. They can also be used for such things as debt consolidation. Some borrowers will use a HELOC to purchase more property or to make other types of investments. Another benefit of a HELOC is that the interest on the loan can be considered as a rental expense, which as tax benefits. One drawback to a HELOC is that if borrowing against a rental property or other investment properties, banks will be less likely to issue a loan, since such borrowers are more likely to default.
If a HELOC won't work for you, there are other alternatives such as a traditional home equity loan, a cash out refinance, or a personal loan.
Leverage the equity in your property to increase its value, or fund more properties
Key Points:
1. A HELOC uses the equity in a home or investment and provides homeowners or investors with extra cash.
2. One challenge that comes with using a HELOC for an investment property is finding a qualified lender.
3. One lesser-known benefit of using a HELOC is to consolidate debt.
Using a HELOC on investment property will allow investors to tap into assets that have managed to build up equity.
Leverage the equity in your property to increase its value, or fund more properties.
The power of leverage is a fundamental of the physical world, but it’s just as strong in the fiscal. Investing in one property will build equity. That equity can be used to power a line of credit, letting you tap funds to boost the value of the same property, or invest in another which can eventually restart the same scenario. With a single piece of property, given time and proper management, you can build value like an avalanche thundering down a mountain.
The Net Operating Income(NOI) is a calculation of the properties operating value minus the expenses the property generates.There are many ways that the NOI can be calculated, but one of the easiest ways is to total all the income a property generates and subtracting all of the expenses the property accrues. Anticipating the NOI is a good way to consider the risks of investing in properties, but would not be a surefire way to get a complete total of income. This number would be an estimate due to unforeseen expenditures, taxes, and fluctuating operating costs. While the exact amount may not be known in advance, a broad total would help with assessing the level of risk a potential investor would like to measure.
Since NOI is calculated annually, an investor can simply multiply operating costs by 12 to get an idea of potential expenditures and weigh that figure against income in that same year. This information would give an investor a head start in planning for a more secure property investment. This same investor would also be able to avoid investing in upside-down properties, also known as ones with Net operating loss (NOL).
A benefit to estimating the NOI is being able to set the valuation of a property. This Cap Rate would make sure that the property is at fair market value. There may be confusion as to what is considered an operating cost for the property. Simply, it would be the daily expenses of operating the property. This wouldn't include investments like securing a mortgage or property taxes. Those figures would have to be considered outside of the daily expenditures.
Aside from investors, lenders may utilize this calculation to determine if the property is a good investment deal to broker a loan. Since NOI is dependent on variables such as rent, utilities, etc, it should be used as an addition to determining value of an investment, and not the only tool used to gather investment information. NOI is an appropriate way to gauge the value of a potential investment.
Net Operating Income is a solid way to evaluate any real estate investment’s potential.
Key Points:
1. NOI is a tool used to determine if a property will make a good investment.
2. NOI determines cash flows and profits from a real estate investment.
3. There is one variability on NOI, and that is how the property will be operated and ran.
By using NOI to evaluate a deal, real estate investors can get a better look at the potential profitability of a property in relation to how much it would cost to operate it. NOI is typically calculated on an annual basis; although, investors can easily adapt the operating costs by dividing expenses by twelve.
Net Operating Income is a solid way to evaluate any real estate investment’s potential.
When it comes to measuring an investment's returns, the numbers don't lie. A key factor in determining the strength or weakness of any rental property's potential and ongoing value is Net Operating Income, or NOI. With it, the property can be accurately evaluated for past performance, as well as what is possible in the future. Don't get caught out paying too much for daily operations on your properties; keep your eye on the NOI.
See the original at: https://www.fortunebuilders.com/noi-in-real-estate/
Exterior Home Remodel: Tips, Tricks, & Hottest Designs
You’ve heard it said time and time again: curb appeal is king when it comes to first impressions. Rather it is to passersby or potential buyers, the view of your home from the street can be a deal maker or a deal breaker. If you’re looking to sell your house or just trying to keep up with the Joneses, there are a number of simple exterior home remodeling tweaks to fit any budget that you can do to give your home’s exterior a visual boost.
Every successful home remodel begins with planning. If you don’t sit down and map out exactly what you want to do, you have no chance of knowing how much it will cost. So, before you even start to throw around numbers, you should put some real thought into exactly what you want to do.
Start by coming up with a vision of how you want the exterior of your house to look. A good way to do this is to browse through magazines or images online. It is also recommended that you take a walk or drive through your neighborhood to see what other have got going on their exteriors: this can be both inspirational and educational if “fitting in” is a concern of yours. Trust us on this piece of advice: don’t rush this stage of the project. Get it right. The clearer you can make your vision, the easier every step after is.
Once you have a vision, it’s time to talk budget. Setting a budget can be easy or hard: if you have a set amount you can spend, then that is your budget. You’re done. If you don’t have a set amount, then you’ll have to add up the expected costs as you go.
With a vision and budget in hand, it is now time to list out what needs to be done to transform your current exterior to the one you have pictured in your head. If you’re on a tight budget, avoid major projects like changing siding, roof color, or large-scale landscaping projects. Sometimes a little paint and the addition or swapping of accessories is all that is needed. You should concentrate and prioritize lighting and landscaping elements: the difference between professional and amateur remodels is in the details. Even if you fancy yourself a do-it-yourselfer, you might want to get some professional help at this stage. Employing a designer could be the difference between success or failure. A professional designer can help you get from your current exterior to your vision in the shortest, simplest route possible. That’s what they are good at.
Once you have a list of projects, you can decide which ones you think you can do yourself and which to hire out for. In both cases, our advice is simple: don’t rush. Be sure to allot enough time in your plan for any DIY projects, and take the time to find a trustworthy contractor.
So let’s recap: develop a vision of how you want your exterior to look, map the changes necessary to transform what you have to what you want, set a budget, figure out what you are capable of doing yourself and hire people to do the rest. If you follow these simple steps, your remodel is almost guaranteed to be a success.
How your home looks, more than actual condition, can make a very profitable difference when selling.
Key Points:
1. When it comes to real estate, you only have one chance to make a positive impression on a person.
2. You need to use your goals as well as finances to create a budget that is very realistic.
3. You need to assemble a team together that you can trust for your job.
If you are hoping to boost the overall aesthetic of a given property, an exterior home remodel is a great strategy. Whether you are a homeowner or investor, there are exterior remodel projects for every budget. Keep reading to learn more about which renovations will help ensure your property makes a good first impression, every time.
How your home looks, more than actual condition, can make a very profitable difference when selling
Buying a home is a big financial decision for someone. And while a lot of very serious thought and research go into any home purchase, often the decision can be nearly made, or even fully settled, with just one look at the property. Your sale can be made or broken in that first look, and remodeling the exterior could boost your sale price.
See the original at: https://www.fortunebuilders.com/exterior-home-remodel/
Let me hear your thoughts...
Here are 4 Must-Haves When Investing in Out-of-State Rental Deals
Sometimes your local real estate environment is not conducive for getting into the real estate game. There might not be any inventory available or the prices in your hometown could be too high. Whatever the reason, you may want to consider looking into other cities and states. While you can reap good rewards and make some money. There are some complications to doing business far away from where you live.
Here are some basic elements that you will want to establish before you fully commit to the investing of real estate out of your state:
First , you will want to make sure you have a clear and precise target property. Are you looking for apartments? Homes? Mansions? How much money are you willing to spend? How much time will it take to see a return on your investment? What states, cities or types of neighborhoods interest you? Make sure you have a clear target and keep the properties you consider within these guidelines.
Secondly , you need to get a management team in the local area of your rentals. Do your research, find a good team that will do a great job keeping your properties rented, keeping your properties maintained and provide you good communication.
Third , assemble a team. You are going to need a lawyer in the states you have rentals in. You will also need a local maintenance team. And if you are not traveling to examine properties yourself, you will need a good quality real estate agent to help you find deals and secure what you are looking for.
Lastly , the most important for last – you need to find funding. Most things come down to money. How much do you have? Do you need partners to make this happen? Look for investors if necessary. Layout your blueprint and ideas to an investor and see if they like your plans. If they do, they should have no problem funding you. Best of luck!
Rental properties can be great passive income, but knowledge is more important than money for profit #Ironclad
Follow Ironclad
Tweet Now
Key Points:
1. Real estate is one of the best ways to generate and maintain wealth.
2. Properties are moving fast, you need to have everything in place to secure what you want.
3. When you are looking to invest out of state, you need to be smart about how you spread your money.
The market is moving so fast right now, if you find a good deal, it’s not going to stick around for a couple of days before it’s under contract. Ensure your deals are successful by taking these steps first.
More people than ever are taking funds they have available and buying property to put on the market. Turning your investment profitable takes more than just the initial funds; you’ve got to invest wisely, and manage it even more carefully. Sticking to some basic principles can keep the money flowing in rather than out, and help maintain not just your income but the value of your investment.
The post 4 Must-Haves When Investing in Out-of-State Rental Deals appeared first on Iron Clad Group.
See the original at: https://www.biggerpockets.com/blog/investing-elsewhere-rental-property
I read this are Article I am happy to share with you. Let me hear your thoughts.
I Know I’m Being Successful When...w/Dean Jackson | 624
Dean Jackson, an entrepreneur, marketing genius and real estate investor gives his advice on succeeding in the real estate business and life.
Goal: To Obtain a Listing Agent Lifestyle
Lifestyle elements: daily joy, abundant time, and financial peace.
If you’re not joyful it usually means you are rushed and don’t have time, when you don’t have time it usually means you are overworking because there isn’t enough money.
The solution: make more money in a way that takes less time which will in turn bring more joy.
How would you look for distressed properties to purchase?
First you must identify people wanting to sell. Most people are curious about the value of their home. So offering a free home evaluation or market report can get you the attention of a lot of prospective sellers. Out of those sellers there will a certain percentage that are in distress or need to get out from under their mortgage quickly.
Now as a real estate investor I could keep the leads I want to pursue but sell on the other leads to a real estate agent.
Questions Sellers Are Interested In?
What is my house worth?
What is the average sale in my neighborhood?
How much sales activity is going on in my neighborhood?
Can I sell my house without the hassle of putting it on the market?
The common formula for real estate investing is:
Determine the fair market value.
Subtract repair costs.
Determine the profit you desire.
Most properties should be acquired at 50% to 70% of the homes fair market value.
Large venture real estate firms like Opendoor will buy your house for approximately 90% of the market value. It is largely all done online. You fill out a form send in some pictures, they keep a fee and they buy your house.
Meeting a defined goal is how you determine you are successful.
Dean defines success as:
Free time – when I am in complete control of my time and can do whatever I want
When passive revenue exceeds lifestyle needs
Working on projects that excite me
Not knowing is scary, especially when it’s your money on the line. Learn how to recognize success.
Key Points:
1. Success can be measured by the joy in your life and the amount of your free time.
2. Real estate success depends on marketing to people and meeting their need.
3. Working less and making more is a key ingredient to a happy life.
Most people look at success as something aspirational.
Not knowing is scary, especially when it’s your money on the line. Learn how to recognize success.
We all want success, but recognizing when it’s upon us can be tricky. Balancing budgets against dreams, desires versus reality, it can be overwhelming. Especially when you’re looking at your first ledgers and trying to make ends meet. Don’t get lost in the weeds. Learn how to spot success before it passes you by.
See the original at: https://epicrealestate.com/being-successful-dean-jackson-624/
@Srikanth Kasa Love to chat with you.