Making Money in Real Estate
February 10, 2011
Making money in Real Estate is the most popular strategy to build wealth. If you’re not currently making money and building wealth in real estate you need to start. I have been making money using four very simple strategies that are very simple to duplicate.
All of the millionaires I have learned from make money and build wealth in real estate. That’s right, all of them! These real estate strategies can set you free for life!
If you learn and implement them you can build a massive amount of wealth in a very short period of time. I use a system for all four of the strategies that all go hand in hand.
These strategies can easily make you rich in a very short period of time. I use the first strategy to make money fast, the second strategy for making money in chunks and the third strategy is for building wealth and creating income for the rest of my life. The last strategy I use to buy real estate extremely cheap.
I use a step by step system for all of these money making systems. The first strategy requires in many cases no money and no credit. It’s the strategy I use to create anywhere from three to fifteen thousand dollars in profits per deal in a short period of time without ever even buying real estate. This strategy is known as wholesaling.
It’s easy to begin making quick money. You don’t need money to make money with this strategy! If you have bad credit don’t worry, you don’t need good credit to make money with this strategy. My goal is for you to have a check in your hands of $5,000 or more in 30 days or less!
I can show you my exact system on how to do it. Wholesale is nothing more than making an offer on a piece of real estate, getting that offer accepted, then simply assigning to contract to someone else. Don’t worry, making an offer on something doesn’t mean you’ll be forced to buy it”.
Making offers on Real Estate is easy! You can do it two ways. Through a realtor or directly to sellers who don’t have their homes listed with a realtor.
I developed a specific step by step system to find listed and unlisted properties to make offers on. Most of my deals are through listed properties. I use a realtor to make offers for me on properties that are listed.
There are a lot of realtors who won’t understand what you’re trying to accomplish. I’ll teach you exactly the process I use to find my realtors as well as how to get them on the same page as you with what you want to accomplish.
There are so many properties for sale. You need to learn how to find the best one’s to make offers on. Learning how to wholesale is the first step in becoming a real estate investor and getting out of the rat race! In all of my money making strategies I believe it is the easiest one for both beginners and advanced investors.
I use the second strategy to create larger chunks of cash anywhere from twenty to sixty thousand dollars in profits per deal. It takes a little longer to generate those profits than the first strategy but one deal generates much more money. This strategy is called retailing.
This strategy has some great advantages. It’s easy to make consistent $20,000+ on every deal, it can be done part time, and it can and should be done with someone else’s money!
Flipping real estate is nothing more than buying a house; fixing it up if it needs repairs, and then selling it for a profit. Most Real estate flippers that fail don’t understand the number 1 rule, Buy Cheap! When they buy a house most of them think they’re buying it cheap but chances are they’re not.
The biggest mistake investors make is they don’t calculate all of their costs before they do the deal. There is a specific formula that’s easy to follow that will make sure you follow this very important rule. The way you buy your real estate is the difference between winning and losing.
If you are new to real estate investing the first strategy you should implement is wholesaling. The reason is with wholesaling you learn how to make extra money without risking your own money. When you accomplish that then move to retailing.
After you learn how to earn extra money wholesaling, you will have accomplished your first step in becoming a successful flipper. That first step is learning how to buy cheap!
The third strategy I use to build wealth and get paid forever. By doing this I create a monthly income that will last forever. Making money in Real Estate is not just creating quick cash; it’s also about creating enough wealth where you can literally never have to work again! This strategy is known as buying and holding.
There are many ways to build a Money Making Machine. The best way is through real estate investing focused on building wealth. Making money now is important but creating wealth for the rest of your life is what will set you free!
Buying real estate isn’t hard, but, buying real estate correctly is where most people go wrong. Understanding what makes up a good deal is your greatest asset with this strategy.
You make money when you buy; you get paid when you sell. If you’re a beginner this will be the most important thing that must be understood. If you buy right you will have a lot of equity and great cash flow for the entire time you own a particular investment. This is what I refer to as building a money making machine.
In real estate there are many strategies to make money quick. Those are the strategies you should begin with because you have to learn how to buy cheap enough to make money.
After those strategies are executed that is the time to worry about building for the rest of your life. There are multiple ways to buy cheap it’s all about learning the ones that will work for you.
Now, once you know how to buy cheap creating wealth is easy! Simply make sure you have great cash flow with each deal you intend on doing and before you know it after multiple deals you will start building monthly cash flow.
Continue this simple recipe over and over and in a very short period of time you could be generating enough cash flow to live on then you can focus on getting rich and wealthy! Best of all you can focus on whatever you want because you don’t have to work if you don’t want to.
The reason this is my favorite real estate strategy is because I love residual income. Creating something once that pays you for the rest of your life is the smartest thing you can do financially. All my rich mentors made this lesson very clear to me.
Building a money making machine first starts with making quick money in real estate. Once you learn that you will know how to buy real estate the right way. From there all you have to do is hold it for cash flow for the rest of your life!
The final strategy I use to buy real estate extremely cheap from distressed sellers. Buying cheap through properties in pre-foreclosure is a tremendous opportunity.
There are so many ways to make money in real estate. Many people have a hard time finding which way fit’s them the best. Some people like to stick to one strategy, others like a lot of different strategies.
I recommend doing some research and reading some books to learn about all the different ways there are to make money before you choose one. I recommend the following products because they should help you decide what kind of real estate strategy you want to pursue.
Making money in real estate goes hand and hand with all of the other best money making strategies. The reason is the tax advantages you get blend very well together with all of the other money making strategies. Real estate investing is also one of my favorites because it is the best way to build ultimate wealth that will last forever!
Learning a simple money making strategy is easy. The hard part is where and who do you ask to teach you? This used to be my problem until I met some very successful mentors.
I learned for them many strategies to get rich, this one is one of the best. Making money in real estate is all about buying cheap! By finding and buying distressed real estate you will be able to buy extremely cheap.
Those who have a way to buy real estate extremely cheap will succeed. Pre-foreclosure investing is a great way to buy cheap from distressed sellers. It’s a win-win situation for you and the seller.
There are a few ways to buy real estate in distressed situations. If a seller is in pre-foreclose which means they are behind on payments but their home hasn’t been foreclosed on yet they would probably be very interested in selling.
Most of the time people end up losing their homes and would have been much better off if someone was there to help them out of that situation. Like I said, Win-Win situation.
There are two scenarios for the buyer. There is either already sufficient equity in the property for them to purchase it or there isn’t enough equity. Most of the time there won’t be enough.
There is a simple money making strategy know as short sales for properties that don’t have enough equity. In this case the bank or mortgage company that has a lien on the property will most likely accept a huge discount on what they are owed in exchange for a payoff of some amount for what they are owed.
For example, if a property is worth $200,000 and the bank has a lien of $180,000 for a property in not great shape they will probably accept a huge discount. The reason is the cost they have to incur to foreclose, list, and resell is huge.
You make them and offer at $100,000 as a payoff. After negotiations they accept $120,000. You’re now able to buy a $200,000 home for $120,000 through your knowledge.
All in all, these four Real Estate Investing Strategies all have their advantages and disadvantages. There is a sequential order they should be implemented in. Take this information and use it to the best of your ability and be smart and savvy out there.
My Name is Michael T. Keenan. I have been studying all aspect of finance for many years. I specialize in learning how to duplicate money making strategies that already exist which has allowed me to make a lot of money much quicker than normal. I have met hundreds of various millionaires and studied thousands. I used their strategies and techniques to get rich. I narrowed down all of the strategies used these millionaires to ten main strategies that I believed would be the easiest for me to duplicate and teach once I executed them. My studies have come a long way and it has allowed me to pursue two of my passions. I’m passionate about being wealthy and I’m even more passionate about teaching others how to get wealthy. After executing several of the ten strategies I began to write a website which allowed me to share my resources and knowledge with others. This was my first step in following my second passion which is educating others. I love adding new knowledge that I’ve required along the way to my website so everyone reading my site can benefit from that knowledge. I hope everyone interested in creating wealth and ultimately a better life for themselves and their families enjoys my articles and website. Visit my site below to learn more about the ten strategies I believe are the easiest money making strategies to duplicate in order to obtain massive wealth.
[http://www.bestmoneymakingstrategies.com/Making-Money-In-Real-Estate.html]
Article Source: http://EzineArticles.com/?expert=Michael_T_Keenan
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The Near Future of Real Estate and Gold Coins
February 3, 2011
Spring has sprung. That time for romance, gardening, cleaning, fishing, dreaming and, oh yeah, house hunting.
Spring is typically when dissatisfaction over one’s living situation has reached it zenith and it seems right, after a long winter indoors, to cast one’s eyes elsewhere.
That being the pattern, there doesn’t appear to be the usual flurry of house hunting so far this 2010 spring.
Maybe most Americans haven’t quite rolled out of hibernation just yet. Or maybe it has something to do with the lingering winter weather still out there.
Or maybe people are just waiting for real estate prices to drop as far as they’re going to drop first. That’s called…
REAL ESTATE DEFLATION
If you know that the price is falling on something you want to buy, why buy it now? Why not just wait until you’re convinced that the price has more or less stopped falling? That’s only deflation common sense, and maybe what’s holding up real estate today.
We should also be on the lookout for…
ANOTHER ROUND OF RESETS, MODIFICATIONS AND FORECLOSURES
The average U.S. home price will fall by about 6% by September 2011, according to a joint report pulled together by Fiserv and Moody’s Economy.com.
What’s behind these falling prices?
Most Americans believe that the “resetting” of adjustable rate mortgages (ARMs) is behind us. Not so. In fact, sadly enough, we probably still have quite a way to go. Resets will likely peak somewhere around September of 2011.
That’s when, chances are, another round of foreclosures will also take place.
Then there’s commercial real estate. About $1.4 trillion in commercial real estate loans are due for refinancing between now and 2014. That’s scary.
So more dark clouds are on the real estate horizon. Does that mean real estate, of any kind, isn’t where you should be putting your money right now?
Not necessarily. Real estate investments will always be local. In some areas, homes have dropped enough in value (parts of California, Arizona and Florida, for example) that they may represent a genuine bargain.
TODAY’S APPROPRIATE ALTERNATIVE
TO REAL ESTATE
But for those unwilling to brave today’s housing risks, gold and silver coins remain tremendous investment first aid. Since 2000, for example, gold has been up 301%-that’s been a nice piece of appreciation even as real estate has broken so many hearts…and banks.
But here’s the thing: Those same fundamentals that drove gold beyond $1,000/oz are, if anything, stronger today. Inflation, recession, unemployment, trouble in Europe-all signs that a precious metal diversification is still a very wise choice today.
The best investors are those flexible few folks who aren’t as much in love with any one investment as they are capable of adjusting their positions when it’s entirely appropriate and even obvious to do so.
Kevin DeMeritt, President of Lear Capital, is a published author, analyst and expert guest on more than 1000 radio programs, including Rush Limbaugh and Coast to Coast with George Noory, discussing today’s economy, gold and the geopolitical picture. Now more than ever, his insights are welcome by nervous investors. Visit http://www.LearCapital.com for all the investing help you need.
Article Source: http://EzineArticles.com/?expert=Kevin_A._Demeritt
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Mixed Signals From The Real Estate Market
January 19, 2011
Many states have been hard hit by the collapse of home prices nationwide and the sluggish economy. Many mortgage brokers expect a slow but steady come back in the real estate market. Still there remains a glut of foreclosures and unsold properties, and job growth remains stagnant.
A few years ago, a booming market was a seller’s market. Buyers were plentiful, the competition driving home prices upward. This led to speculators buying homes for the sole purpose of selling them six to twelve months later to make a tidy profit, further driving home prices upward. As long as the nation had a dynamic economy, it was still possible for homeowners to buy and prosper. It seemed like everyone was getting their share of the American dream.
As housing prices collapsed, followed by a deep recession, unemployment topped out at 12.5%. Housing depreciated by 40% to 50% as the rate of foreclosures soared. Residents who bought before the crash saw their equity disappear.
Now for the good news. Home sales are on the rise. Inventory is still high. Strong price corrections have already occurred. February 2010 sales were up 21% from February 2009. A large number of foreclosures and a glut of unsold condominiums in tourist areas continues to keep prices low. This is good news for buyers, bad news for sellers.
Lower prices mean residents can buy a higher quality home for a reasonable price with a low mortgage rate. Slow but steady growth should result in appreciation of home values allowing those of modest means to make economic progress. Although unemployment remains high, temp agencies are now adding jobs, usually a precursor to real job growth. Job losses have slowed, but until the unemployed get back to work, sales will remain weak. Prices will remain low.
New home building has rebounded ever so slightly as building costs have decreased. This trend is limited to areas near large cities where the jobs are. New home buyers are primarily first time buyers and retirees who are finding affordable again. Construction is proceeding slowly. Builders remain cautious. Major concerns are the weak job sector and the continued glut of foreclosures for sale.
Some investors are betting that the economy will improve and beach cottages and condominiums will be in increasing demand for seasonal rentals. Many investors are buying and leasing to foreclosed homeowners who can’t qualify for a home loan. There has been some return to lease options between investors and renters. There are many opportunities and pitfalls to be considered. The cyclical nature of economies and real estate has to be factored in to any buying decision. An investor buying today should plan to hold his investment several years until the market rebounds.
Expect mixed signals and uncertainty to continue through 2011. Although strong price corrections have already occurred, the real estate market may not yet have hit bottom. Home prices and mortgage rates are expected to remain low throughout 2011. A lot depends on the job sector. The unemployed don’t buy homes. Home owners who lose their jobs may lose their homes to foreclosure. Residents who fear job losses do not buy homes. For those who can and are ready to buy, low home prices are allowing more residents to purchase homes and low cost rentals are bringing seasonal visitors and tourists back to many areas of the country.
First Nationwide Lending is a Sarasota mortgage company that can help potential home buyers figure out how much home they can afford. They also help current homeowners looking to lower their monthly payments, take out cash, or reduce the term of their existing loan with a Florida refinance loan product. Visit their website for the lowest Florida mortgage rates.
Article Source: http://EzineArticles.com/?expert=Kevin_Elvis_Johnson
The Importance of Location
December 17, 2010
If you are looking for a place or a property that you can purchase and call a home, you would always hear the words, “it’s all about the location” or, more precisely, “location, location, location.” These words are almost always uttered by real estate agents, but what does it mean exactly?
In a nutshell, there are only three kinds of locations when used in the real estate market – the right type of location, the average type of location, and, lastly, the wrong type of location. It does not matter if the houses are of the same type, but what matters is that the location of the property adds value or decreases the value of the property. This is, in fact, considered as the most important rule in the real estate industry, the “golden rule” to be exact. Sadly though, this rule is oftentimes the most disregarded and ignored rule.
Suffice it to say that it will not do you a lot of good to purchase the best home at the most affordable price if you are in the wrong location. You can remodel and improve the house all you like, even renovate it completely, but you will never be able to move the house and transfer it to the right location.
With this being said, what are the prime locations – the right locations that you should be choosing and looking for?
If you have children, it will be to your advantage to choose a property that is near some of the best schools in the area. The cost of such properties may be higher than usual, but it is really going to be worth it to spend a small fortune on a home located near the school, especially for those with children.
Properties that afford a grand view of the landscape – be it a lake, an ocean, a river, or even a beautiful view of the city during nighttime – are naturally more expensive. Likewise, properties near parks and greenbelts are also being offered at more expensive prices simply because it is the right location for people who enjoy a good view or a place that offers a visually appealing background.
Buildings and houses located near shopping districts as well as the entertainment districts are also more expensive simply because a short walking distance away from these areas means less traffic and more convenience for the homeowners. They need not take their cars to drive to these places, but they only have to walk and be there in a few minutes.
When you say prime locations, this also includes those houses or homes near public transportation which gives them access to busses, taxis, and cabs. Properties located near hospitals and healthcare facilities as well as office buildings are also considered prime locations, especially for those people who go to work at these places.
On the other hand, those poor locations include properties near commercial or industrial areas simply because these areas are much more noisier than usual and the fact that there is constant traffic interrupting what should have been a restful day. Examples of these are those properties near railroad tracks as well as those properties under flight paths.
Properties found in crime-ridden areas and economically- depressed places are also cheaper than those found in safe and economically-stable places.
Pursuing a Real Estate Career in a Market of Uncertainty – Good Idea Or Bad?
September 5, 2010
The real estate market in the United States today is a controversial subject, ranking up there with banking institutions, health care, unemployment and politics. So is pursuing a career as a real estate agent in this economy a smart thing?
Normally one might think this field may not be the best career move being the housing market is quite unstable, however, let’s ponder that thought for a moment. If the real estate market is unstable, chances are, existing real estate agents may be looking to change their line of work because they can’t take the pressure of waiting and waiting for the commissions checks because there is a ton of inventory and the competition is tough and let’s face it, not all agents are exactly working at the same level of professionalism. Those that chose the profession as a part time hobby will not survive this type of market. Why? Because it is a challenging market and a part time agent or an agent that has not kept up with the fast changing housing market, may not want to take the time to keep up with all that is current.
However, someone that makes the commitment in their business and comes forth with a clear vision, the right attitude and mindset, may see this as a huge opportunity to make an excellent salary. The reason for this is simple. If there are homes on the market and plenty of them, that means those homes need a buyer in order to close.
If the savvy new agent gets themselves out there in the public as soon as possible, starting to brand themselves, they could have buyers and sellers in no time!
For the agent to have a pay day there has to be a closing. If there is no closing there is no pay so a savvy realtor would need have to have a few strategies and a business plan of attack and stick with it.
Some things someone wanting to get into real estate now would be:
* Educate themselves on the local market conditions in the area they want to work.
* Check for area real estate schools and research their curriculum, pricing and course session times.
* Interview with several real estate offices in your area. Don’t get enrolled in real estate classes until you talk to the real estate brokers first. Some brokers will pay for your schooling and if they don’t offer it to you, ask. perhaps they can give you discount.
* Make sure once you decide to make this career change you commit to it and take it seriously, jump on any training courses your new real estate office is providing and have your business strategy in place out of the gate
Being prepared in this housing market or any housing market will only better your results and place you miles ahead of the other agents that have not taken advantage of the opportunity.
He has just been accepted into the prestigious membership of the American Society for Training and Development professionals. He is the owner and CEO of Agent Edge Training Inc. http://justshutupandbuythehouse.com/indexs1.php
Article Source: http://EzineArticles.com/?expert=John_Horne
Buying Real Estate – How To Be Smart When Attending Open Houses
July 2, 2010
If you’re planning on buying a new home, attending open houses can be a good way to find a home you want or pick up useful ideas from what you find. Visiting open houses should be an enjoyable and fun experience, but you also have to keep focused on the reason why you are there. Primarily you’re trying to get home buying information and maybe even find that special house that you have been looking for.
With that in mind, you need to approach visiting open houses with an organized mindset. Very often, you’ll be visiting several open houses in the same day. And over the course of a few weeks, it can add up to quite a few homes that you have visited. As a result, it can be very easy to forget important points from one house to the next. So to ovoid this problem, it’s a good idea to take very good notes on each home that you visit and perhaps even take along a digital camera to get a few snapshots if you wish. Of course, make sure that it is agreeable with the householder before taking photos of the inside of their home.
Whenever you visit an open house, jot down a few things that you like and dislike about it as soon as you arrive. What is its overall appearance from the outside? Is it close to nearby schools if that is a necessity? How about shopping malls? And how far away would it be from your job? Sometimes these are questions that home buyers fail to take into account early in the buying process.
When inside the home, be sure to check everything and take plenty of notes as you go. A few things to watch for are the condition of the cabinets, the carpet, the walls, the ceilings, and so on. Take good notes on any items if you feel may need repair.
Consider the size of all the rooms in the home, and determine if they will meet the needs of you and your family. If necessary, even take a tape rule with you to be able to measure out individual rooms and see what kind of space is available. Pay particular attention to storage and closet space, as this is an area that is quite often overlooked by new home buyers, but will become very important if you should decide to buy.
It’s also a good practice to spend a few minutes outside the home and listen for noises that could be bothersome. Perhaps there is a train that passes nearby, or freeway noise that seems excessive. Just taking the time to listen can sometimes be very illuminating, and can help you ovoid moving into a home where noises could be constantly irritating.
Of course at most open houses, a real estate agent or broker is likely to be present. If so, feel free to ask plenty of questions, but keep in mind that the answers may not always be straightforward. If you try to make notes though as the questions are answered, there is a good chance that you’ll get more honest answers. Don’t be shy about asking questions either, as the purchase of a new home is a very large investment, and you want to be sure that you are well informed about all aspects of the home before you even consider it as a purchase.
Sometimes you may even find some mortgage lenders attending certain open houses as well. But just be sure to stick to your original schedule, and not fall for any special deals that they offer you if you buy right away. Remember, open houses are just for looking, not for buying.
Sometimes you can find the home you want within a short period of time, and other times you may have to visit several open houses before you find anything that seems to appeal to you. Just be sure to take your time and be patient as you go through the process of visiting local open houses.
Jim Johnson
http://www.articlesbase.com/non-fiction-articles/buying-real-estate-how-to-be-smart-when-attending-open-houses-26970.html
How to Minimize Risk When Buying at Real Estate Auction
June 28, 2010
Some of the greatest returns on real estate investments are earned by purchasing foreclosed or distressed properties. By investing money in foreclosed properties, savvy real estate investors have learned that they can purchase real estate property significantly under value. You can too if you do your research and avoid common pitfalls.
With every type of investment, there is risk. In most cases the higher amount of risk that you are willing to take results in larger returns on your investment. The same is true in real estate investing. This means that the properties that stand to make you the most money also present the most challenges.
While there are three stages of the foreclosure process where it is possible to purchase the distressed property, only one offers the greatest return. This is the Sheriffs sale or auction phase. If you are able to purchase a property at this time you could realistically take ownership of the property for as much as 45 percent under the listing price of the home. But with this reward comes great risk.
The greatest way to minimize risk when investing in real estate is to do your homework. Heres a checklist to help you out:
Find out how much of a cash deposit you will need at auction. In many cases this is 10 percent with the remaining balance due within months, weeks, days, or hours. Make sure that you know the laws in your state and county.
Try your best to inspect the property before the auction. If you can not inspect the property, strive to build up a relationship with the homeowner so that you can learn about any costly repairs that need to be done and calculate them into your bid price.
Verify that there are no other liens on the property through a title search. If you purchase the property at auction, these will become your responsibility.
Know your competition. Since the original lender for the property wins at auction 80 percent of the time, forming a relationship with the lender is a good idea.
Set a bid price and stick with it. Avoid becoming emotionally involved in the bidding process and over bidding. Have a solid idea of what you are investing in, how much you are willing to pay for it, and what type of return you expect.
Remember; the goal of investing is to minimize risk and maximize profit. By doing your homework before the auction, you will be sure to do both. Never buy a property blindly. Doing so only sets you up for failures that will cut into your profit margin.
James Klobasa
http://www.articlesbase.com/non-fiction-articles/how-to-minimize-risk-when-buying-at-real-estate-auction-91664.html
The Future of Commercial Real Estate
June 23, 2010
Although serious supply-demand imbalances have continued to plague real estate markets into the 2000s in many areas, the mobility of capital in current sophisticated financial markets is encouraging to real estate developers. The loss of tax-shelter markets drained a significant amount of capital from real estate and, in the short run, had a devastating effect on segments of the industry. However, most experts agree that many of those driven from real estate development and the real estate finance business were unprepared and ill-suited as investors. In the long run, a return to real estate development that is grounded in the basics of economics, real demand, and real profits will benefit the industry.
Syndicated ownership of real estate was introduced in the early 2000s. Because many early investors were hurt by collapsed markets or by tax-law changes, the concept of syndication is currently being applied to more economically sound cash flow-return real estate. This return to sound economic practices will help ensure the continued growth of syndication. Real estate investment trusts (REITs), which suffered heavily in the real estate recession of the mid-1980s, have recently reappeared as an efficient vehicle for public ownership of real estate. REITs can own and operate real estate efficiently and raise equity for its purchase. The shares are more easily traded than are shares of other syndication partnerships. Thus, the REIT is likely to provide a good vehicle to satisfy the public’s desire to own real estate.
A final review of the factors that led to the problems of the 2000s is essential to understanding the opportunities that will arise in the 2000s. Real estate cycles are fundamental forces in the industry. The oversupply that exists in most product types tends to constrain development of new products, but it creates opportunities for the commercial banker.
The decade of the 2000s witnessed a boom cycle in real estate. The natural flow of the real estate cycle wherein demand exceeded supply prevailed during the 1980s and early 2000s. At that time office vacancy rates in most major markets were below 5 percent. Faced with real demand for office space and other types of income property, the development community simultaneously experienced an explosion of available capital. During the early years of the Reagan administration, deregulation of financial institutions increased the supply availability of funds, and thrifts added their funds to an already growing cadre of lenders. At the same time, the Economic Recovery and Tax Act of 1981 (ERTA) gave investors increased tax “write-off” through accelerated depreciation, reduced capital gains taxes to 20 percent, and allowed other income to be sheltered with real estate “losses.” In short, more equity and debt funding was available for real estate investment than ever before.
Even after tax reform eliminated many tax incentives in 1986 and the subsequent loss of some equity funds for real estate, two factors maintained real estate development. The trend in the 2000s was toward the development of the significant, or “trophy,” real estate projects. Office buildings in excess of one million square feet and hotels costing hundreds of millions of dollars became popular. Conceived and begun before the passage of tax reform, these huge projects were completed in the late 1990s. The second factor was the continued availability of funding for construction and development. Even with the debacle in Texas, lenders in New England continued to fund new projects. After the collapse in New England and the continued downward spiral in Texas, lenders in the mid-Atlantic region continued to lend for new construction. After regulation allowed out-of-state banking consolidations, the mergers and acquisitions of commercial banks created pressure in targeted regions. These growth surges contributed to the continuation of large-scale commercial mortgage lenders [http://www.cemlending.com] going beyond the time when an examination of the real estate cycle would have suggested a slowdown. The capital explosion of the 2000s for real estate is a capital implosion for the 2000s. The thrift industry no longer has funds available for commercial real estate. The major life insurance company lenders are struggling with mounting real estate. In related losses, while most commercial banks attempt to reduce their real estate exposure after two years of building loss reserves and taking write-downs and charge-offs. Therefore the excessive allocation of debt available in the 2000s is unlikely to create oversupply in the 2000s.
No new tax legislation that will affect real estate investment is predicted, and, for the most part, foreign investors have their own problems or opportunities outside of the United States. Therefore excessive equity capital is not expected to fuel recovery real estate excessively.
Looking back at the real estate cycle wave, it seems safe to suggest that the supply of new development will not occur in the 2000s unless warranted by real demand. Already in some markets the demand for apartments has exceeded supply and new construction has begun at a reasonable pace.
Opportunities for existing real estate that has been written to current value de-capitalized to produce current acceptable return will benefit from increased demand and restricted new supply. New development that is warranted by measurable, existing product demand can be financed with a reasonable equity contribution by the borrower. The lack of ruinous competition from lenders too eager to make real estate loans will allow reasonable loan structuring. Financing the purchase of de-capitalized existing real estate for new owners can be an excellent source of real estate loans for commercial banks.
As real estate is stabilized by a balance of demand and supply, the speed and strength of the recovery will be determined by economic factors and their effect on demand in the 2000s. Banks with the capacity and willingness to take on new real estate loans should experience some of the safest and most productive lending done in the last quarter century. Remembering the lessons of the past and returning to the basics of good real estate and good real estate lending will be the key to real estate banking in the future.
Chad Mayes is the creator of CEMLending.com [http://www.cemlending.com], a resource which provides commercial mortgage loan financing and hard money lending options. This article is copyright of CEMLending.com [http://www.cemlending.com]. This article may be reproduced as long as author’s name and all links remain intact.
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Understand Why Banks Reject Short Sale Offers
April 15, 2010
It is very rare to get a bank to agree or accept a short sale. In instance when it agrees to one, there is usually an upfront agreement that it would. However, this is not often the case. In fact, it is very hard to know whether or not a bank would actually accept a short sale offer. This applies everywhere including Brooksville and an experienced Brooksville real estate agent will tell you upfront.
It is Not Actually a Short Sale, Is It?
The reason is very simple – simply because the seller and his agent advertise a listing as short sale does not automatically make it one. There is only an expressed hope that the listing will become a short sale.
In truth, the price of a home listed as short sale has little bearing on the price that the bank may be willing to accept. A price may be unreasonably high to attract potential buyers or it may be too low for the bank to show an interest on the property. Unfortunately, there are Brooksville Real Estate Agents who would actually place unbelievable prices on short sale properties in order to attract offers. Unfortunately, the acceptance of the seller of an offer does not mean that the bank will take interest on the short sale.
But what is a Short Sale?
A short sale results when a bank or a lending company accepts an amount less than the seller of a property owes to the bank. There are instances when a single property may be encumbered by more than one loan. If this is the case, both lenders must agree to the short sale.
Usually, if you are the seller, you would need to comply with a lot of requirements before the bank would approve the short sale. You do not have to have your property in foreclosure in order to apply for a short sale. You also need not be falling behind your mortgage payments. However, do not expect the bank to agree to a short sale.
First of all, you would have to justify the price of the short sale. This means that you would have to submit a comparative market analysis. Short sale offer price is often too low, so you need to justify it to the bank before it will accept the offer. If the bank believes that it will make more money if it opts to foreclose the property, chances are it will not accept a short sale offer.
You need to be very careful with your documents. Make sure that every piece of important document is submitted, accepted and received by the bank. This could have an impact on the approval or disapproval of the offer. Make sure that you submit complete packages altogether. Submitting one document after another through mail is a bad idea.
The bank may also disapprove the short sale if the seller is not at all qualified to offer it in the first place. If the seller has other assets that the bank can tap in order to cover for his loan, the bank may not really accept a short sale offer. This is the same everywhere including Brooksville.
There may be other reasons why banks would not accept short sale offers. It is always a good idea to prepare for any eventuality.
Reasons To Choose Brooksville Real Estate Agents
January 13, 2010
With the economic downfall that has just about killed the housing market a lot of sellers and buyers have quickly become cautious when it comes time to choosing a real estate agent for their own basic needs. Everywhere you look in the news there has been a lot of different controversies regarding the real estate agents and how they are breaking contracts and swindling buyers and sellers out of thousands of dollars. All of this has made the word of mouth even more vital than it had ever been. One of the best ways that you can be sure that you are getting the best deal on the property that you are either selling or buying is to go through a local real estate agent.
Therefore if you are looking for a new home that is located in a new neighborhood then you should really consider choosing Brooksville real estate agent. The people that are located in the area will be able to tell you which realtor is the best. They will also be able to tell you about their overall professionalism and dependability. Word of mouth is a very valuable tool and when you take the time to listen you will be well on your way to gaining a great realtor for your own personal needs. Also the people in the area where you are looking will even be able to provide you with various listings to talk to these agents about that have not even had the chance to hit the market yet.
In looking for the right real estate agent, you have to make sure to know his or her expertise. You have to know if he or she has the know-how and the knowledge about Brooksville real estate, since you have to make sure that the real estate agent has the knowledge and skills in selling a property or home in Brooksville real estate. It is really important that Brooksville real estate agent knows the market, he or she can easily sell your home if he or she is familiar with the market.
Brooksville real estate agent will also have prior knowledge of all the necessary essentials that are in the particular area. This should include the crime rate, schools, hospitals, and whether the house you are currently looking at is located in a safe neighborhood or not. The local real estate agent that you choose should have a good knowledge of all these aspects and others. This will help you save time in your search and can also save you money overall.