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Real Estate Investing Dangers ? Warning!

Saturday, March 19th, 2011

Real Estate Investing Dangers – Warning!


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Home Page > Business > Business Opportunities > Real Estate Investing Dangers – Warning!

Real Estate Investing Dangers – Warning!

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Posted: Jun 17, 2008 |Comments: 0
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Unfortunately, many investors get very excited about the notion of becoming extremely wealthy through real estate investing in a specific market. They assume because they live in the city, they know the market well, where they assume that real estate investing – like using techniques known as “house flipping – is a simple procedure that anyone can do and get incredible amounts of money for. Unfortunately, some real estate investors move from another successful job or business into real estate investing and make a number of mistakes that can cost them dearly. This leads investors into multiple foreclosures, and even bankruptcy.

A recent article in the San Francisco Chronicle points out that speculators who enter the market hoping for real estate investing miracles with no real plan for profitability have contributed to the Bay Area’s subprime loan woes. In many cases, these investors bought properties casually and without careful forethought, buying frequently and often with no money down. They were speculating that the prices would continue to rise, giving them an instant classic. However, when the markets began to drag and the prices went downward, keeping up with mortgages on multiple properties and dealing with properties that have no buyers resulted in foreclosures.

As the San Francisco Chronicle article points out, a key problem for real estate investors is lack of solid real estate investing knowledge. Many investors assumed that they knew what they were doing or assumed that multiple properties without the capital to back them was acceptable. When the market was good, even investors with less investment savvy made money. When the market started to struggle, however, these investors did not have the real know-how to make their real estate investing business work.

According to the San Francisco Chronicle, the other problem that many of these investors encountered occurred because they tried to succeed on their own. Many of these investors simply snapped up properties on their own when the market was good, without developing a good business team or network. Successful investors – those who are still house flipping for good profits in a difficult economy – have teams and networks that help them. You should, too.

Others can help you find the best real estate investing bargains, financing, renovation materials, and more – everything you need to make your real estate business a success story.

One place where teams are important is at the buying stage, for example.

Every property you buy must be carefully looked over by a professional you trust. Just because the property is at a bargain price, that does not make it a bargain. That’s why you should have an assessor look over the property to tell you the true market value of the home, and you should have an inspector look the property over for hidden problems such as buried oil tanks, asbestos, lead paint, and other common problems that are not apparent even to the experienced real estate professional.

Although the San Francisco Chronicle article does not mention it, some savvy investors do question the role television plays in misinforming new investors. Current reality shows sometimes make flipping seem very easy. Smart investors know that real estate investment is simply not what you see in television. Like any business, real estate investing takes know-how, research, and work.

If you’re determined to make a fortune investing in real estate by flipping or buying distressed properties and reselling them a profit, the first step often begins with choosing the right type of property. While television shows may suggest that the real work and the real profitability comes after the initial purchase, when bathrooms can be cleaned out, yards can be redone, and living rooms can be redecorated, the reality is that successful real estate buys begin with a bargain. You simply will not make as much money on a real estate deal if you pay too much for the house up front.

House flipping begins not with selling for a profit, but with buying for a profit. This is called “value investing”, and anyone looking to begin investing in real estate to make lots of money and create monstrous wealth should keep this in mind.

After all, the more money you can save on a quality home in a good neighborhood, the more profit you stand to make eventually. In fact, if you buy the right property you may not need to put up with the hassle of renovating, upgrading, and otherwise making over a home. An investor or even homebuyer may be willing to buy a property from you as is after you’ve found a great deal. You can literally make tens of thousands of dollars on the deal without putting a sent into the property itself.

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Real Estate Investment Success Series Tip #4 -how To Spot A Real Estate Investment Bargain

Wednesday, February 23rd, 2011

Real Estate Investment Success Series Tip #4 -how To Spot A Real Estate Investment Bargain


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Home Page > Advertising > Real Estate Investment Success Series Tip #4 -how To Spot A Real Estate Investment Bargain

Real Estate Investment Success Series Tip #4 -how To Spot A Real Estate Investment Bargain

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This article is part of the Real Estate Investment Success Series and continues from http://www.realestateinvestment101.info/commercialpropertyinvestment.html

As mentioned in our previous article, like in value investing in stocks as made popular by Benjamin Graham, money is made in the purchase of real estate investment property. You want therefore to purchase property with good rental yield and that is at a discount relative to the surrounding area. This article identifies three ways to find a below market real estate deal so that you can either resell it later at a higher price or enjoy lower mortgage instalment payments and from that a greater cash flow.

Method #1- Distress sales and foreclosure

The general rule of thumb in real estate investment is that the target property might sell for a price lower than the areas average if the owner is in distress. There are two possible situations that you might want to look out for so that you can negotiate with the owner to reduce their asking price.

Firstly, look out for mortgage foreclosures on property and monitor the property auction sites. Banks may under-finance property meaning that they might not want to risk financing the property and then have to sell the property at a loss during a recession (negative equity situation). So what happens is when the mortgagor (the owner) is in default of his mortgage, the bank would foreclose the property and auction off the property and sell it off. Note that under the common law, while the bank is supposed to get the best value for the owner, this sometimes does not happen and the best way the bank can discharge its liability is to auction off the property.

As we can tell from the above analysis, the bank usually just wants to get the selling price enough to cover the outstanding mortgage and so the reserve price for such auctions may be below valuation prices. Spend some time attending such real estate auctions and it could pay off in helping you get a property at below market value.

Method #2- Migration

When people want to migrate out of a country fast, there is a high chance that they will not be picky about what price the property can fetch. These people generally want to sell off their property fast and the first prospective buyer that appears on the horizon for their real estate would usually benefit from this. On your part, you would want to get an independent valuation of the real estate and then make an offer.

Ann wanted a property near the city’s amenities and was looking for such a property. There was a family that was moving over to France and sold it to her at a bargain. It turned out that what that family wanted was hard cash fast so that they could move out. Ann gave it to them and all parties were very satisfied. Thus bargains can be found if you know more about your seller’s reason for selling.

Method #3- Look for landlords with attitude problems

This strategy is rooted in human nature and you may chuckle when you hear it. In some areas, some properties are always yielding lower rentals than other places and this might be because of the landlord rather than any other fundamental reason. If the landlord has a bad temper for instance and then finds it hard to get tenants who can stay, might try to entice present tenants to stay with lower rentals. This would therefore translate into a lower valuation for the property. At the point where you appear on the scene, some of these sellers are willing to accept a lower price to get a problem off their hands.

Things to note with this real estate investment method include spending some time with neighbours staying around the property in question to find out any hidden defects, bad tenants or crime related problems that the owner may not be telling you about the area. It may not be all the landlord’s fault.

In conclusion, we have spotted three ways that you can take into account when analyzing a real estate investment. Real estate investment can be said to be like any other form of shopping as you want the best quality for the lowest price. But do not be let paralysis by analysis stop you from taking action. Here’s wishing you all the best in your real estate investment endeavours!

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Joel Teo takes a keen interest in real estate investment as part of a larger investment portfolio. For more tips on real estate investing check out our real estate investment success series

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Where is the best place, on the dollar, given growth potential and safe/secure lifestyle… to invest in real estate outside the United States?

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Understanding Real Estate Investment Trusts

Tuesday, February 15th, 2011

Understanding Real Estate Investment Trusts


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Understanding Real Estate Investment Trusts

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Posted: May 22, 2006 |Comments: 0
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So you want to be a landlord without having the problem of repairing faulty roofs and lights? Maybe real estate investment trusts (REIT) are for you. These structures are basically legal structures to allow investors to get access to the rental proceeds via dividends. These rental proceeds are net of property management fees and other legal fees pursuant to the transaction.

Developers use this instrument to offload properties in their stable into the real estate investment trusts so as to generate cash to purchase other commercial buildings while retaining a sizeable stake in the REIT. Each year or half yearly depending on the REIT, they distribute rental income in the form of dividends to investors. Things to take note off include what the properties in the REIT are. Sometimes developers try to move their non-performing assets into the REIT so that their listed companies can report better illusory earnings and you should take note of this.

Now that we have explained what a REIT is, the rest of the article will highlight three reasons why you might want to invest in a REIT.

Firstly, owning units in a REIT allows us to gain rental exposure to large commercial buildings. Let’s face it most of us real estate investors do no have the financial ability to own large commercial buildings so sometimes it will be good to purchase units of a real estate investment trust so that we can participate in the upswing in office rental of a commercial building.

Secondly, owning units in a REIT because of its trust like structure allows for a tax flow through of the profits (this means no tax on profits from the REIT). If in doubt, spend some time consulting your tax attorney for advice on this. Another way to get some tax knowledge is to ask for a copy of the prospectus of the REIT and read the section on tax advice.

Thirdly, listed REITs are tradable like shares so you can do the normal things that you would do with shares. The advantage of this is that you can examine the usual commercial rental data to determine whether rentals are going up or not and when you should purchase the units in the REIT. Always remember the importance of value investing especially so in an investment involving real estate. Spend time researching on the REIT that you are interested and figure out the value that you think it is worth and wait for the unit price to drop and swop in to make your purchase.

In conclusion, we have gone through the basic concepts of how real estate investment trusts work and highlighted three reasons why you might want to invest in a real estate investment trust (REIT). Remember that like with all investments, do your due diligence, time your entry and exit properly and you can make money both from the equity value and the rental yield of the underlying properties.

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Home Page > Finance > Real Estate > International Real Estate Property Investment made easy with Findire site

International Real Estate Property Investment made easy with Findire site

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Posted: Jul 01, 2010 |Comments: 0
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Findire has established itself as one of the leading names in international property market. The team at Findire has helped thousands of clients in their search to make sound, long term investments that provide both security and the highest possible returns. Findire’s mission is to provide the most up to date information and investment advice in the world’s most favorable property markets. It believes in making unique level of research and diligence and find pride on the unparalleled levels of professionalism and ethical service Findire offers. Findire has everything from city centers to luxury beach resorts.

The investment properties we source offer some of the highest capital appreciation and rental yields. Even the period of economic uncertainty there are exciting investment opportunities in Miami amidst emerging, new and traditional property markets. The good news is that with diligent research there remain a number of places in which you can look forward to investing which offers more than favorable returns on your investment.

The site has the best of Miami property deals and real estate holdings. Much current news refers to falling property prices around the world. Such commentary could lead you to believe that now is a bad time for property investment. However, the headlines ignore two points of fact.

Find International Real Estate.com (WWW.FINDIRE.COM) is a member of the International Consortium of Real Estate Associations (ICREA), which is comprised of more than 25 leading national real estate organizations, representing Brokers and Agents worldwide, each of whom adhere to a code of conduct. Working with developers around the world does not only provide a great excuse to travel, it also treats the senses to a veritable cultural feast. So if it’s a romantic villa in Tuscany you’re after, that fantastic waterfront property or an apartment on Miami’s famous South Beach, FINDIRE.COM can help!

We at Find International real estate.com believe that fostering trust and good relations in business is essential. Everyone that works at Find International real estate.com is committed to working as a team, so no matter whom you speak to, our methods and ethos will be the same. We always welcome the suggestions of others to improve our service, so please feel free to email us your comments.

The first is simply that not all economies are in negative growth and not all property markets are falling. Despite global trends, much of what dictates the performance of a specific property market is the local, intrinsic dynamics of supply and demand. As a result, there are a number of property markets around the world which still offer immediate growth opportunities, Miami being one of them. The second is that turmoil in many markets is creating another exciting basis for investment value.

As prices fall in places like the USA and UK, rental incomes relative to purchase price are increasing. At the point that yields is sufficiently high we start to see value as the level of yield provides sufficient headroom for future price growth before yield drops to an unattractive level. Such value investments therefore offer good yields and long term growth prospects.

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Find International Real Estate (WWW.FINDIRE.COM) is a British American website that has been designed as an innovative form of advertising for the real estate industry. We have 20,000 visitors a day viewing 1.2 million properties from 158 countries translated into 20 languages. Our visitors are looking to buy, sell, or rent property and we can exposure your property for sale to 7.2 million buyers in 12 months on findire.com and over 50 million buyers via our partner sites.

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house property for sale, houses for sale, international properties, land for sale, overseas property for sale, overseas property sale, property find, property for sale, property investment, real estate international

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Real Estate Investment Success Series Tip #3 – 3 Reasons Why Owning A Commercial Property May Make You More Money In Real Estate Investment

Thursday, February 3rd, 2011

Real Estate Investment Success Series Tip #3 – 3 Reasons Why Owning A Commercial Property May Make You More Money In Real Estate Investment


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Home Page > Advertising > Real Estate Investment Success Series Tip #3 – 3 Reasons Why Owning A Commercial Property May Make You More Money In Real Estate Investment

Real Estate Investment Success Series Tip #3 – 3 Reasons Why Owning A Commercial Property May Make You More Money In Real Estate Investment

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Posted: May 21, 2006 |Comments: 0
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This article is part of the Real Estate Investment Success Series and continues from

http://www.realestateinvestment101.info/RealEstateFinancing.html

If you ever have been a landlord for residential property, I am sure that you get complaints from tenants about leaking roofs in the middle of the night. But what keeps most people back from investing in commercial real estate is the fear of the unknown since not many of us are born commercial landlords. However we can learn from Donald Trump who spent his energy developing large office complexes and that’s where he made his money. This article will highlight three reasons why commercial property real estate investment is better than private real estate investment.

Reason #1: Rental Yields may be better for commercial properties

For commercial property like shop space, the rental yield that you can command depends directly on the human traffic in the area. Thus if you invested money in such a property investment, the monthly cash flow would be more than an equivalent costing residential property investment in the same area.

In addition, most business owners when they come to view your property have already identified your street as a good one for their business in terms of human traffic and usually want to start renting from you, thus you have the upper hand in negotiations. Contrast this to most residential tenants who have a huge variety of properties to choose in your vicinity and if they do not like your property or your rental they can just as easily go to another property.

Reason #2: Improvements on the property

Business tenants generally treat properties different from residential tenants. A business owner who is renting property would generally fix small defects in the property so that he can carry on business and would not bother the landlord about such small problems. But additionally, most small business owners would generally carry out small improvements in the property that could boost the property value of your commercial property.

An example of this could be the installation of a PABX System and wiring up the whole office for a local area network. This could save your new tenant a lot of time and could be used to give additional value to the terms of the rental that you are providing.

Another example I heard recently involves office partitions. Law firms and accountants generally have the same set up in their offices and when law firms move, they generally would have to spend money renovating so if you have existing partitions in your commercial property, you might be able to get a whole professional firm over to rent your property. Note in contrast, in most residential property, tenants tend to love to puncture holes in walls without permission, repaint certain rooms and at the end of the lease and as a result most landlords have to do lots of repairs just to return the property into its original condition.

Reason#3: Rental Collection

Typically there are some tenants that are not very prompt with their rental payments and therefore the ability to choose tenants who would pay would save you lots of money and make you even more in the longer term. Imagine having to loose a few months of rental payment and spend money on lawyers to evict the defaulting tenant from your property.

If you have a commercial property, you can choose a tenant that has lots of goodwill established in your premises. This would mean that the tenant has a lot vested in your property and would therefore pay his rent on time to stay out of rental disputes. Contrast this with a residential property where the tenant can run away without paying your monthly rental and has nothing very much to loose. Collecting rental from residential tenants seems to be more difficult as well for some strange reason.

In conclusion, this article has highlighted three reasons why commercial property real estate investment may be better than private real estate investment. That said, making money with real estate is like value investing in stocks, the profit is made in the buying. The time spent looking for a good property will reap its rewards later in the form of good rental yield and capital appreciation over time. Take massive action today and look for the real estate investment property that you think meets your real estate investment needs.

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Joel Teo takes a keen interest in real estate investment as part of a larger investment portfolio. For more tips on real estate investing check out our real estate investment success series

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Joel Teo takes a keen interest in real estate investment as part of a larger investment portfolio. For more tips on real estate investing check out our real estate investment success series

Real Estate Investing Is It Right For You

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Home Page > Finance > Real Estate > Real Estate Investing Is It Right For You

Real Estate Investing Is It Right For You

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Posted: Apr 15, 2010 |Comments: 0

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Real Estate Investing Is It Right For You

By: George Forsythe

About the Author

I have been an author and writer on many internet related topics and products. I pride myself on finding information on what people want to know. Giving people access to the most relevant information on their related topics.

(ArticlesBase SC #2155189)

Article Source: http://www.articlesbase.com/Real Estate Investing Is It Right For You





There are many types of investments in this day and age. One of the most often touted for creating millionaires around the world is real estate investing. Even in the field of real estate there are several different investment styles. Each style involves varying degrees of risk on behalf of the investor. If careful consideration is taken there is a type of real estate investment that is best for most people though there are some that real estate will never be a good investment for.

Those who are simply not cut out for real estate investing are those who love to watch the ticker roll across the computer monitor or television screen indicating the worth of their portfolios on a daily basis. Those who need to see in print the wisdom of their investment practices rather than those who are content to sit on their investments as they take shape or those who are willing to actively work in order to make their investments pay off.

Types of Real Estate Investment

Buy and hold real estate involved purchasing property and holding on to it for a very long time while the value of the property appreciates in value. This requires someone that is very savvy when making purchases or extremely lucky for the most part. More importantly however, it involves someone who has the patience and tenacity to hold on to their investments for a long period of time. These investments can provide a nice retirement for the right investor as well as funds at the proper time for the weddings of children or to pay for college.

Rental properties are another excellent way to make money for those who are willing to deal with a long-term property investment. In this type of investment money is made each month to either pay or contribute to the mortgage and funds can be made once the property is paid for and sold later in life in order to receive a more complete and total profit from the endeavor. There is some degree of expense along the way that is involved in keeping properties up to date and in demand however the benefits of this particular type of investment are almost undeniable for the right investor.

Flipping is another type of real estate investment that is receiving a large amount of press these days. This process involves purchasing a property below its value, investing in repairing or rehabbing the property, and then reselling the property for a substantial profit. This is one of the few short-term sorts of investment that are widely profitable when it comes to real estate investing.

Of course there are high-risk real estate ventures for those that need a little excitement in their lives. One of the more common high-risk investments would be pre-construction real estate investing. With this form of investment the investor is actually ‘betting’ that the future property will sell for a higher price than the investor paid once the building is complete.

Whether your investment needs are low-risk, high-risk, or somewhere in between there is quite likely a style of real estate investment that will be appropriate for your specific investment needs. If you do not find a real estate investment plan that is right for you then do not despair there is no style of investing that is right for everyone.

My Real Estate Wealthis a complete system book designed to guide you step by-step through the most streamlined and comprehensive real estate investing program available.

You won’t learn how to make millions overnight, but you will learn exactly what you need to do to build a solid real estate investment portfolio that can grow and grow and make you and your family financially secure for the rest of your lives.

For more information please Click Here

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George Forsythe -
About the Author:

I have been an author and writer on many internet related topics and products. I pride myself on finding information on what people want to know. Giving people access to the most relevant information on their related topics.

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property investing, investment properties, property investors, money investment, how to invest, income investing, investment property, real estate investing, making money

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I have been an author and writer on many internet related topics and products. I pride myself on finding information on what people want to know. Giving people access to the most relevant information on their related topics.

How To Make 37%, Tax-Free, Without the Stock Market: Secrets to Real Estate Paper

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How To Make 37%, Tax-Free, Without the Stock Market: Secrets to Real Estate Paper