Real Estate Investing Facts

Becoming a Real Estate Rehabber by Alexis McGee

I’ve been talking a lot lately about the “Investors Flip Feast” going on right now. With an Investor’s Flip Feast you contract a great deal with a homeowner and then assign your contract to another investor for a quick finder’s fee. It’s a great way to get started in foreclosure investing without needing any of your own cash or credit.

Once you’ve mastered “assigning deals” to investors for quick paydays, you are ready to make some serious money in real estate by buying a property at a discount, fixing it up, and selling it on the retail market. This is also known as “rehabbing” or “retailing.” This is a great way to see the results of your work immediately and build wealth quickly. It works in any market, any time. And it is working especially well right now with all the great fixer foreclosure opportunities everywhere around us.

Our many foreclosures.com successful rehabber clients focus on fixing up “entry level” family properties and make $30,000-$60,000 or more on every deal. Doing two or three houses like this a year can provide great extra income for college and retirement expenses, while doing six or more deals a year can provide you with a great living and be your ticket to firing your boss.

Cosmetic vs. Structural Repairs

When looking for a great property to rehab, keep your eyes open for fixes that will make a big difference, but not necessarily cost a lot. Less really is better in the retailing business. Look for houses that need cosmetic changes such as:

· New paint

· New carpet

· New fixtures

· New landscaping

· Minor clear termite repairs

Until you become an expert at rehabbing, avoid properties with structural problems such as foundation issues or severe dry rot. Major rehabs can be extremely profitable, but you must refine your job-costing skills first or you can get stuck in a money pit.

Buy It Right and Everything Else Falls in Place

It’s often said that real estate investors make their money when they buy, not when they sell. This simply means that when you get in for the right price, you are guaranteed to profit when you get out.

So what is a good deal? You want to have at least a 30% margin PLUS repairs to ensure that you make enough profit. For example, if a house in perfect condition will be worth $200,000 fixed up, you must get it for $140,000 LESS the cost of repairs. If repairs are minimal and only $20,000 then you need to buy it for $120,000. In this scenario, when including repairs, you are actually buying the house at 40% off.

Out of that 30% margin, 15% goes to buying, holding, and selling expenses and 15% goes to your profit. In the same example, your 15% profit on a $200,000 retailed house will net you $30,000. The higher the resale, the more money you make. If the house is smaller than $200,000, I pencil in a minimum of $30,000 flat (rather than 15% percent) to make sure I get my minimum payday for my time, effort, and risk.

Also remember that the bigger the repairs, the bigger the discount (I’ve been known to buy at more than 50% discount on bigger projects). Remember, you’re dealing with motivated sellers–typically fixer uppers–which means the houses you buy will NEVER be in perfect condition.

Make Sure You Get it Right

To make every deal as profitable as possible, you must prepare in advance and estimate all your costs properly. The biggest risks in rehabbing property are:

While you can make a great deal of money in rehabbing, it can be frustrating and time-consuming if you don’t do it right. On the other hand, you don’t have to deal with tenants, you can see the progress being made every day, and you’re updating housing and improving a neighborhood. It’s rewarding to drive by houses you’ve bought, rehabbed, and sold. And your new neighbors love you.

If rehabbing houses interests you, try doing one or two while maintaining your current job. If you enjoy it, and it makes you enough money, perhaps you might try going full time as an investor. Fixing up houses for new buyers is one of the most satisfying things you can do in real estate, and the most profitable.

John Assaraf the Spiritual Entrepreneur

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Picture this …

You export a list of houses from the MLS (or anywhere for that matter) that you want to make offers on, get dirt cheap, sell sky high, and make millions with.

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But instead of handwriting a thousand offers, faxing them all out, getting blisters, hating your life, and kicking your cat at the end of the day (PETA is watching) … you simply upload them into The OfferBot® which is a brand new feature in Freedom$oft 3. Takes all of 6 seconds.

Once uploaded, you choose what percentage of the asking price you want to offer, your terms, and how often you want to follow up.

Then you hit “send.”

1,000 people just received customized low-ball offers from you on their houses that have probably been sitting on the market for friggin four years.

Think you’ll be able to get just a few of those accepted? What would that be worth to you if all you did was flip one measly house for a $5,000 assignment fee? I’m guessing $5,000. lol

My Longwinded Point –> what used to take days now takes minutes.

What used to be the suckiest part about real estate investing is now the easiest.

Freedom$oft is taking the work out of… work. Or something clever like that.

They’ve already brought in over 1,000 new users since releasing Freedom$oft 3 a few days ago. I’m not
sure they want too many more from what I’ve heard. They don’t want this messing up their personal real estate biz by over-flooding the market. They may have to shut this down soon …

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With the rise in the number of foreclosed houses, property traders have developed a number of strategies for making use of them to create a quick return. Whether you plan to utilize a foreclosed house for rental revenue or “flip” it for a quick return, you usually have to take into account the outcome of any kind of delays or unforeseen stumbling blocks prior to signing on the bottom line. Opting which technique will work finest for you depends upon how much income you can give to have tied up in real estate, remodeling and maintenance although the market returns to normal and you’ll be able to generate a decent gain on your investment. 

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One of the most important part of buying a foreclosed residence will be the standing of the title because it may consist of prior debts or liens that could swiftly consume your financial gain. If at all possible, you can discover a foreclosed residence having a clear title, yet in the event you discover a foreclosure property that still has debt accrued you need to fulfill the unpaid balance before you’ll be able to sell the house and property. It’s up to you to figure out the title background, investigate all parties involved and verify with the mortgage company to assure that you recognize the paper trail that comes with any title. Investigate all outstanding claims against the foreclosure and don’t base your choice entirely on the “sticker price.”

The current marketplace movements and projections for the future will have a huge impact on your decision whether or not to lease a foreclosed home or sell it off rapidly. Often you’ll discover you are able to realize a bigger benefit from the sale of a foreclosed property or home by waiting until the market place stabilizes. You need to determine whether it really is well worth the expense of offering it as a rental or if it’ll be much better to spend money on renovations or upgrading. You will have to consider the factors to determine whether you’d be better served to spend on renovations and remodeling or if it could be smarter to lease it while you wait for far more perfect market circumstances. In case you buy a property in the Brampton real estate industry and the pattern is a downward one then you might need to wait around a long time in making a profit.

The concept of “flipping” foreclosed houses is extremely tricky and to assure a fast return on your investment you’ll need far more than a simple awareness of the real estate sector. Area information is key so in the event you buy in Windsor get a superb Windsor real estate agent to assist you. Considering that opposition is brisk for homes in foreclosure, you could find yourself vying with qualified specialists for the choice homes. As a result of the sharp learning curve regarding the subtleties of foreclosed properties, many title businesses provide to assist novices, however you’ll have to pay money for them to perform the legwork and hence cutting into your revenue. 

As soon as you might have completely investigated the status of a foreclosure and therefore are acquainted with the background and property status, it really is possible to make a deal with banks and lenders to pay off financial loans at cents on the dollar. Obviously, you need to make sure you totally understand implications of taking on this debt and assure that you simply can absorb any extra obligations and costs. It truly is also crucial to put aside adequate resources to help keep from getting the foreclosed residence you purchase entering foreclosure again just due to the fact you underestimated your resources

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Now that the housing market is sinking, you might have asked yourself if today indeed is the perfect time to buy Baltimore MD Homes for Sale. If yes, then would a foreclosed home a good option? It is everyone’s advice that before anyone sinks their cash on any form of investment; they have to understand the ins and outs first.

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Recently, you can find foreclosures in different socio economic status – low-, middle- and high-income neighborhoods. You can see foreclosure signs even just around your neighborhood. You can start building your network of contacts from the residents where you hope to invest in the future as well as on banks, and other real estate agents. You can befriend a real estate agent who specializes in REO to help you learn about the basics of foreclosures. Remember to check online real estate sites or public records of foreclosure listings services as well as newspaper ads.

Most investors and agents are emphasizing on a safer way to buy Purcellville Homes through buying foreclosures that are bank-owned. Prospective home buyers can buy these distressed properties in one of the following phases:

1. Pre-foreclosure – the homeowner still has control of the property

This type of purchase is also known as short sale. What investors do is they try to negotiate a deal to homeowners who are delinquent on their loans to bail them out. This purchase turns out into a discount for the buyer where the price is below the home’s market value. This first phase is typically called the grace period because the owner still has at least six months to pay off the default amount.

Auction sale

Buying a home at an auction offers some high profits, but it does have its drawbacks. You buy a house as is and while the property is conducted by a third party trustee or sheriff, the lender may not make a profit and there would be no money left for the homeowner.

3. Real estate-owned (REO) – a lender-owned property

This is the easiest and the safest method in buying a foreclosure. It offers the least value and most competition. Since there was no one who has bid higher than the default amount, the lender will have the distressed property. The lender will have the option to sell it for profit.

4. Government-owned – potentially a slower process with more paperwork

Buying foreclosures that are government-owned can amount to more paper work and a possibly slower process.

Buying foreclosed properties is indeed a profitable and satisfying experience to both potential buyers and real estate investors. But before you dive in, research and seek help from the best experts in the field for a successful and smooth home buying process of your home in Real Estate Ogden.

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The current foreclosure crisis continues rampant across the country.  While a number of reasons and opinions can be put forth as to why the nation finds itself with a record-breaking number of foreclosures, the fact still remains that there are a lot of properties experiencing foreclosure filings across the nation.  While this is a negative fact for many, it is also stands as an occasion for many real estate investors and home buyers to obtain great deals on property.  Knowing the areas where foreclosure rates are high is one of the first courses of action when looking to invest in real estate.  

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According to Realty Trac, in during May 2010 , the top 4 states supplying the most foreclosures were Nevada, Arizona, Florida, and California.  These four states by themselves accounted for more than one half of the 322,920 foreclosure filings for the entire nation in the month of May.

In Nevada, 1 in every 79 homes faces foreclosure, making it the state with the biggest foreclosure percentage in the nation.  Clark and Lyon Counties are the main contributors in Nevada containing cities such as Las Vegas, Henderson, Mesquite, Fernley, Yerington, Dayton, and Silver Springs. (For more information about foreclosure properties in Ogden, visit Ogden Utah Foreclosures)

Arizona ranks second in terms of number of of Foreclosure filings. The numbers aren’t nearly as bad as Nevada’s, but still one in every 169 households had a foreclosure filing last month . Maricopa and Pinal Counties have the highest percentage of foreclosures , but Mohave, Yavapai, Graham, Pima, and Yuma AZ all contributed their fair share of unpaid mortgages . 

Not far behind Arizona is Florida with a rate of 1 in every 174 properties in the stages of foreclosure.   Miami-Dade, Broward, Duval, Collier, and Orange Counties are large contributors containing cities like Miami , Jacksonville, Naples, and Orlando. (For more information about foreclosure properties in Ogden, visit Foreclosures in Roy Utah)

California comes next in rank with a ratio of 1 in every 186 homes facing foreclosures in California .  Major counties contributing to this rate comprise San Bernardino, Kern, Orange, Madera, and Merced. In these counties are cities such as San Bernardino, Ontario, Bakersfield, Ridgecrest, Santa Ana, Anaheim, Madera, and Merced.

A comprehension of where these locations of high foreclosure rates exist, provides a great foundation for a buyer or real estate investor to search foreclosures and profit on the remarkable bargains that can be found in foreclosed property purchase.

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