Aug
06
You Mean Location, Location, Location Was a Lie?
Posted By: Ramon Rivas on August 6, 2010 at 9:41 pmMany people who hear about commercial real estate, but aren’t necessarily in the business, often use the expression “Location, location, location!” Many people associate this expression as the truth, that the three most important attributes about a property are “Location, location, location!”
I am here to tell you- this is absolutely not the case! Now, I am not going to say location is not important, but what if you have a beautiful location for a mountain resort, complete with snowy hills, a perfect location for a lodge, and beautiful mountain views? What you want to do to the property is improve it for a weekend getaway for romantic couples with a beautiful lodge, resort, luxury type housing, and perhaps some individual cottages overlooking the green forest. Sounds great, right?
The perfect location- you can’t beat it! But, you learn that the zoning for this property is residential, R1, to be exact. The use is only one single family residence per acre, and no commercial property allowed. What happened to your “Location, location, location?” It flew out the window!
The most important aspect of a property is the use. What is it intended for by designation of the city or county? It does not matter where the property is, if you cannot get the zoning that is in the realm of your intended use.
It is possible to get properties rezoned, especially as cities change and grow. Be sure to consult with the city or county to determine if these changes are even possible, because you do not want to buy a property that you cannot rezone, and be left with an unprofitable property on your hands.
Most people believe that commercial real estate is complicated and you need a special education or know how to succeed in the business. Many think that commercial real estate is filled with international finance, heavy and complicated math, complicated tax rules, and forms and applications that are just too complicated to understand correctly.
I am happy to tell you this misconception is the worst, because it puts a road block in front of many people’s aspirations to become a commercial real estate insider. Let me put this misconception to rest. There is math involved, and most of it is not at all complicated: simple ratios, adding, subtracting and multiplying. What is even better is you don’t have to do the math. There are others who can do that for you. The same is true with property management, inspecting the property, and doing the year-end tax report. In fact, commercial real estate is less complicated than residential real estate because you can focus your energies on a single deal that will be worth perhaps 10, 20, even 50 residential deals and more!
Let me put it into perspective for you. If you owned a business (many of you may), would you create strategies, keep the books, manage the many locations, sell on the front floor, and take out the trash after the day was over? I think not! Commercial real estate is made up of many people whom are there to help you with whatever you need. You must position yourself as a real estate insider, which is a leader in the business.
Another misconception is commercial real estate is management intensive, that you must manage every property you own. Let me tell you when you end up owning 10 or more properties, this is almost impossible to do! You do not have to actually manage your properties yourself, so you can concentrate on creating more deals. Hire a company or set a team in place to take care of this “day-to-day” business.
As you can see, what is passed around in dialogue about commercial real estate is not always true. Before you take everything to heart, be sure to get your facts straight. In fact, many people in this profession speak about commercial real estate as a business in which only the savvy and sophisticated can succeed. They often act this way because they want to keep people out of the market by differentiating themselves. If you were in this position, you would too!
Jul
31Real Estate Investing: Pre-Foreclosure Secrets
Posted By: Ramon Rivas on July 31, 2010 at 11:19 amLocation, Location, Location
In real estate investing, you will drive yourself insane looking at properties in random areas of the country or state. You need to select your location first and then see what properties are available. It’s no good buying a beautiful mini mansion in Ohio if there haven’t been any significant sales in that town for ten years. Once you get your location chosen, then you can focus on the properties.
Many in real estate investing prefer to work with preforeclosure properties than ones already in foreclosure. You not only feel good helping the homeowner out a little bit, but you can often save as much as 40 of the house’s market value.
Don’t be surprised if the homeowner doesn’t answer the phone or the doorbell. They may be scared that you are a bill collector. They may also feel shame and confusion. Be patient. Slip a note under their doors if you have to, just to let them know that you are not a bill collector or their lenders.
Talk To Your Accountant
In order to save more money, those in real estate investing may be entitled to a large rebate for every foreclosure or preforeclosure piece of property they buy. This is due to the Foreclosure Prevention Act of 2008. However, since tax laws seem to change by the minute, don’t count on the rebates. If they happen – great, but do not gamble everything on getting a whopping great rebate check.
Jun
23Essential 101 Starter Guide to Real Estate Investment !!
Posted By: Ramon Rivas on June 23, 2010 at 2:08 pmIf you have been working for some time, you probably have accumulated some form of savings, and the first mistake we dont want to make is to let the money stay idle.
There are many ways to work your money hard, and one highly recommended approach is through
TOP 4 Reasons to choose Real
Estate Investment?
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1) Good choice of property can appreciate in value over a shorter period of time, hence
providing good profits when rented out or re-sold.
2) Real Estate plays a critical role in advancing towards financial freedom, through the
passive and recurring income through rentals for example.
3) Real Estate has less volatility as compared to stocks and shares, hence lower risk.
4) Simple methodologies involved, i.e: Finding the right property, Funding that property,
and Farming that property (making profits)
How to find the right property !!
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Given the thousands of properties available in the market, we want to choose the right
property, so that the value can go up, and it can be easily rented out and resold when
desired at a good price.
Hence, to choose the right properties, we consider the following critical factors.
Real Estate Factors (1) – Location, location, location !!
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Location is also the key factor in looking out for a suitable property. Ideally, it should
be near common amenities and facilities such as schools, markets, bus and train
interchanges, shopping centres, and parks. If you can find a location with all these plus
factors, you are in luck, because such places tend to grow in value fast, and hence proved
profitable for you in no time.
Nonetheless, it is all up to personal decisions. You may desire a place which is quieter and
away from the urban chaos, but that could compromise on some of the accessibility and
conveniences which could in turn have an impact on your property future value.
Real Estate Factors (2) – Size and Amenities
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A common phrase “Size does matters” and that is especially so in real estate, which is the
first impression when a potential tenant or buyer steps into your house. Besides considering
space for the living rooms, and bedrooms, extra spaces like garages, basements,
outbuildings, car spaces, and swimming pools are often a plus point during property
valuation.
Real Estate Factors (3) – Age of the property
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Age of the property is important in determining its value. Older houses have much different styles from modern houses, and this can be both a pro and a con.
Pro in the sense that if your house preserves some nice traditional architectural designs,
and that is highly loved by the prospective client, you could take the opportunity to
increase the selling price, hence making better profits.
Cons in the sense that if the client prefers houses with more contemporary designs, this
could have a dire impact on your older property given that it is harder to sell or rent,
ending up in price wars which is lose-lose situation for you.
Real Estate Factors (4) – Price of the property
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Price is definitely in the consideration, hence it is essential to do a market research in
the neighborhood for similar properties you are looking for before jumping to a decision.
Also, if you intend to take on financing, you should check out the different bank interest,
and other money issues that can occur, so that you wouldn’t be caught in a surprise when
doing the final purchase decision.
Real Estate Factors (5) – Condition of the property
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Arguably one of the most important attributes to look out for in a property. You may have
found the best location, the biggest size at the most bargain price, but if the
condition is inhabitable, what does it make of your newly bought property? – Nothing !!
Hence, it is crucial to observe the condition of every potential property and take into
account the potential repair fees required for that property, and factor into the overall
pricing of the property to see if it is still worthwhile to buy that property.
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To conclude, I have shared with you some valuable insights to why you should adopt Real Estate Investment as one of the very feasible methods to grow your money, and create a steady passive income to achieve your long term financial freedom goal and also essential tips for choosing a property to fulfill that aim.
Next steps is to take actions, and wish you success in your Real Estate Investments !!
When buying anything, you need to make sure that what you’ve just purchased is OK and fits all of your current needs and requirements. Homes are no exception. Whether you buy homes to resell for a profit, or for yourself, you need to close a good deal. If you decide to earn some money by investing in an estate, you really need to make sure whether that estate will or can be made good for your future client(s).
Since we talk about homes, we need everything into consideration. Where is the property located? When was it built? What is the actual condition of the home? How many rooms does it have? Is it in a good, bad or borderline neighborhood in regard to safety? Though discrimination is verboten, what is the ethnic diversity of the neighborhood?
The above mentioned are essential things to consider. You cannot overlook any of these and buy blindly. Think first, than decide.
Location, location, location
This issue is two-sided. If you are buying a property to turn it over for profit, it is advantageous for it to be in a central location, however, if the property is in a run down section and you can see drunks on the streets, stay away, unless you are looking to just rent it out.
What if a house just seems to be in a nice neighborhood, nothing uncommon, neighbors seem nice and friendly? You never know. Maybe a thief or a sex offender lives on the block. You should ask discreetly before buying.
Date of the Building
The year of building is essential, since building styles vary. You may have a certain preference for the kind of house you’d enjoy living in, or what kind of properties you’d like to sell, maybe to build a niche market in restoring and renovating.
Anyway, don’t just look on the outside. Check the interior too. What if walls have holes and rodents or roaches are present? Do you need that kind of problems? Exterminators can help, but rats can do a number on electrical wiring. If buying a house to live in, best to skip over clear infestations. Even if there are no mice and the walls are in good shape… what if the building’s structure isn’t at all stable? Have the house inspected by a qualified engineer.
Partitioning
Do you need the house for yourself? Very good, then you need to know how many rooms, kitchens, bathrooms it has. You also have to know how big those rooms are, and whether or not you would be able to comfortably live in them.
Or, are you an investor? No exception for you. You also have to find out the number of rooms, baths, etc… in that house. After knowing this information, you can start building your plan, and calculating your future monthly or daily income.
After considering everything related to the house itself, you have to start evaluating your budget and maybe family into account. Are you even ON a budget? Can you afford the mortgage payment. Do you have kids, a partner? If so, would they accept to move in there, with you? Could they be as happy in the new surroundings as in your current apartment or house?
If you’re an investor, it’s a different case. You should first of all think about what the market is like, what sort of individuals or families are your potential buyers. Is the school district good? That’s always a big plus. Is it the worst house on the block in an otherwise nice neighborhood? Some fresh paint and a new roof can work wonders.
