Move over, fine china — homes just might be the hottest new heirloom.Americans are moving less than ever, according to an analysis of the U.S. Census Bureau’s Current Population Survey. Just 4.2 percent of American homeowners moved between 2015 and 2016 — which is almost half the 7.7 percent rate reported in 1990. According to the Consumer Housing Trends Report 2017, 86 percent of all American homeowners — defined as those who have owned their home for more than a year — have no plans to move in the next three years. Why? Those planning to stay in their homes list love of their home (58 percent) and neighborhood (45 percent) as the top reasons they don’t plan to sell. A smaller, but still sizable, percentage of homeowners list a very generous reason for staying. Almost one-quarter (23 percent), a total of nearly 14 million households, say they’re not moving because they plan to pass down their home to a family member. This is good news for younger generations, who may be struggling to afford to buy their own home or living with their parents while saving up to buy one. In fact, over the past two decades, there’s been a marked increase in the number of young Americans aged 18-34 living with their parents — 33.4 percent in 2016, compared to 27 percent in the late ’70s. This increase isn’t driven by younger generations who may be putting off moving out — it’s driven by older millennials. Since 2012, the percentage of 18- to 25-year-olds living with a parent has actually started to decline, while the share of 26- to 34-year-olds living with parents continues to increase. If their parent(s) are among the households planning to pass their home down, maybe they won’t ever have to fly the coop. Family financial gifts play a big role in helping people buy homes, above and beyond those generous families giving their entire home away. According to the Consumer Housing Trends Report 2017, 14 percent of all home buyers who purchased a home in the past 12 months used a gift from a family member or friend to help pay for the down payment. That number jumps to 20 percent for all millennial (18- to 37-year-old) home buyers. On Point Homevestments
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Many people are still wondering whether or not real estate is one of the best investment strategies for long-term wealth building. Is investing in homes still a smart investment for the average individual? Is a home still the best investment of a lifetime for most Americans? If so, why are some pessimists still questioning the rebound in the news? Behind the Headlines Real estate companies will always boast about the benefits of acquiring real estate because it is their job. That is, unless of course, they have gotten into the rental business and make their money by touting the benefits of renting instead. Let’s be honest; statistics can be found and twisted to support any point of view and argument. Entire years of real estate statistics have been revised in the past, new indexes have been created to restart the clock, and even the national GDP was revised. Most don’t even bother to tune into job and unemployment numbers anymore due to how skewed different data sets have become. Even though the most conservative figures show housing rebounding, especially in hot areas like San Diego, there continue to be doubters. However, it doesn’t take much more than a little common sense to figure out real estate is still the best investment for most of the population. This applies to affluent individuals with top 1% income, as well as those that need to pinch pennies. Stocks have continued to demonstrate extreme volatility and risk. While UT San Diego reports local real estate is still 50% undervalued. In the stock market, plenty of Americans have lost 6 figures, literally overnight. Direct investment in real estate isn’t that volatile, and nothing is ever lost until a property is sold. For example; some Southern California homeowners saw their home values rise and fall on paper during the last couple of decades, but if they don’t sell for a few more years when prices exceed their previous peak, they will come out handsomely. Invest in Real Estate, Even if You Can’t Afford Your Dream Home One of the top excuses for many not to buy a house is that they can afford their ideal dream homes yet. Of course, unless they invest in real estate in some way now, the odds are against them ever being able to afford that dream home. Incomes haven’t been going up, but rents and home prices have. Those wanting to buy a home should not invest any money in stocks or bonds, but should prefer cash. Of course, in reality, cash depreciates too. It can be at risk whether it is in the bank or under the mattress. Investing in real estate is the best way to build up more wealth and cash to buy that dream home. Can’t find a home you’d live in even for a few years? Then buy a rental property. Many Americans are sadly being seduced into the lifelong renter mindset without realizing the horrific consequences it could be dooming them to. Consider those paying 50% of income in rent right now. Rents have been going up 20% a year in many places. If rent goes up another 20%, many could be priced out of both buying a home and renting too! Then what? With Americans living longer, and with company retirement plans evaporating, they also need to consider where they will live for 40 years of retirement on limited income? Even legendary billionaire investor Warren Buffett, with all of his endeavors into energy, insurance companies and holding sizable stakes in companies like Coke and Wells Fargo, still calls his own home his best investment ever. On Point HomevestmentsWhen you've got to buy a house from across the country, start with a winning strategySearching for a house locally is not without its difficulties. Add hundreds or even thousands of miles to the equation, and it becomes infinitely more complicated. Though long-distance house hunting has its unique challenges, it’s not impossible. In fact, with the right agent and the convenience of modern technology, it’s never been easier to buy a house remotely. Here are a few critical factors to keep in mind when you find yourself in a home search from afar. Do your homework When it comes to long-distance home shopping, “the Internet is your friend,” remarks Meghann Shike of Synergy Realty in Nashville. “You know the neighborhoods you live around, but you know nothing about your new one. You don’t know where the mall is, the [grocery store], or the schools.” Though nothing can substitute checking out the neighborhood in person, Shike recommends looking up commute times to work, crime rates in the area, and, most importantly, how the schools rank. Even if you don’t have children or don’t plan to have children, it’s still good to know the quality of the schools for resale purposes. One of the biggest pieces of the long-distance house-hunting puzzle, however, is to make sure you’re researching who the best local real estate agents are. It’s always crucial to hire an agent you trust, but with a long-distance search the agent can make or break the experience. “You’re going to want someone local on the ground — someone who is very familiar with the city, neighborhood, and prices,” Shike says. “You need to get a feel for how that person operates. Are they available to talk to you? You’re going to have more questions than you realize, and your agent is going to need to be there to answer them.” Have a travel budget When Kyle and Samantha Steele found out they were going to be moving from Oklahoma City to Columbus, OH for Kyle’s new job, the couple looked at listings online, got in touch with real estate agents, and picked an upcoming weekend to house hunt in person. The Steeles’ agent showed them multiple houses, but nothing was quite right. Then they found out that many of the older neighborhoods in the area didn’t have great access to high-speed Internet. That’s when they decided to build. Their agent was instrumental in guiding them on their short house-hunting weekend, and in finding a builder. “[Our agent] basically helped us with everything, every step of the way,” Kyle states. “When we couldn’t find anything, she helped us find model homes in the area we’re building in, and showed us three different model homes. She answered questions, and helped us find the building company. She even helped us find a hotel for the weekend.” Inevitably, unexpected appointments came up during the building process that required one of the Steeles to be present. “We had to make an appointment to meet with the design studio to pick out the floors and the carpet,” Samantha remarks. “So far, I’ve been to Ohio twice.” The couple advises long-distance house hunters to prepare and plan ahead, especially for last-minute travel. “Be flexible,” Kyle says. “Make sure you have a few thousand dollars in reserve that you can spend on plane tickets and a hotel — because you will have to go back and forth.” From the agent perspective, Shike recommends planning a house-hunting trip that’s at least four to five days long, so you’re not cramming in tons of showings that you won’t remember at the end of the day. Know what you want When you’re in the market for a home, you should always have a running list of features you want, but it’s especially crucial when you’re buying from a distance. “I like to tell my clients to do a ‘top five.'” Shike says. “What’s your non-negotiable? Is it being able to step out the front door to walk your dogs? Do you want to walk your kids to school?” Knowing exactly what you want out of a house and location allows your agent to help you narrow down neighborhoods and homes more easily, and assist you in making an offer quickly, which is especially important in a fast-moving market. “Buyers need to get over the fear of writing an offer when they haven’t seen the house in person,” remarks Shike. “I can video chat our way through the house, but I can’t get you on a plane [to get here] in the same time the local people can who are shopping.” Overcome remote home-buyer jitters For those buyers who are nervous about making an offer sight unseen, Shike says there is the possibility of adding a clause in the contract that the sale is contingent on the buyer seeing it. Of course, there is also always the option of renting first before you take the plunge. “You could rent for the short term or get a six-month lease, which is enough time to get settled in your job or routine,” recommends Shike. “That can be nice for buyers who are a little more anxious about the process — to relieve that anxiety.” Overall, buying a house from a distance shouldn’t necessarily be looked at as a negative experience. In fact, Shike believes it can give many shoppers new opportunities, and buyers are often more excited when purchasing long distance. “It can be a nice change of pace for people,” Shike adds. “Another benefit to moving long distance is a fresh start: a new neighborhood, new culture, new people, and new experiences everywhere.” On Point HomevestmentsWhat if your dream home just happens to have ancient wiring and a cracked foundation?So you’ve set your sights on a home that, to put it mildly, needs a little repair work. The stairs are creaky, and you’ve noticed a leak (or three). Still, your mind is made up. What’s a love-struck home buyer to do? If your heart is set on a fixer-upper, this advice from real estate experts can help you make that “needs-work” house a home. Check the zoning “Any municipality has zoning districts, and you need to know what uses are permitted,” says George Vanderploeg, a luxury real estate broker with Douglas Elliman in New York. Knowing the zone is important because it will tell you what you can and cannot do to the home. For instance, when interiors photographer Josh Gibson decided to renovate his 19th-century cottage in Beaufort, SC, he had to contend with the historic district landmarks commission, which required hours of research and visits downtown. Among the many requirements he had to adhere to were installing single-pane windows and maintaining the home’s unique brick-pier structure. To research your prospective home’s zoning requirements, you can visit its municipality’s website, or arrange to meet with a staff member, who can walk you through the legalities. Bring in a home inspector Once you’ve made a verbal agreement to buy the house and are waiting for the contract to be drawn up, you’ll want to hire a home inspector. A home inspector will look for structural issues and advise you on things that may or may not need to be replaced, such as plumbing, electricity, and roofing. Your broker can refer you to an inspector, but it’s important that this person not be biased, as you’ll need an objective opinion. With this in mind, Vanderploeg advises finding someone who will work for you — not for the broker or seller. Be sure to set aside about an hour or two to walk through the building with the inspector and ask questions. “This allows the buyer to get to know the house really well before they buy it,” Vanderploeg says. Home buyers tend to ask questions about asbestos and termites, but Hal Einhorn, the principal inspection consultant for Old House Inspection in New York, says it’s equally important to ask about the “general age of certain systems,” as those will indicate when they’re nearing replacement. A 26-year-old boiler, for instance, is likely to go kaput soon, whereas a newly-installed air conditioning unit probably won’t be a problem for the next 20 years. Depending on the home’s location, you may also want to ask about issues specific to its region, Einhorn says. In New York City, for instance, where the water mains tend to be dated, you’ll want to clarify that the one in your coveted home isn’t made out of lead. And with today’s families using more electricity than ever, you’ll need to find out if the amount of power coming to the house is suitable, or needs an upgrade. Doing a little research online can be helpful. Another important topic to bring up is any work you’re preparing to do, like upgrading the bathroom or turning a one-bedroom home into a two-bedroom, Einhorn says. Find out the agency requirements, and if the home is in a landmarked district, make sure you know the ramifications. Will your project require filing documents, and if so, what is the process? Hire an architect and/or contractor Hiring an architect is important because you’ll want their take on what you can do from a design perspective, says Vanderploeg. The architect will also be able to point out the home’s load-bearing walls, which will determine whether they can be moved around or not, says Scott Oyler, a broker with Coldwell Banker in Cincinnati. When hiring a contractor, be sure to do your homework so you find someone you can trust. “I’ve heard of horror stories where contractors left in the middle of the job and never came back,” Oyler says — so make sure your crew has good references. Also be sure to recruit more than one, he adds, as you can never have too many opinions. Research tax incentives Depending on where you live, you may eligible for a tax abatement, a tax credit for homeowners who improve their property’s value, Oyler says. Philadelphia offers one; Cincinnati does, too. Check to see what’s available in your area. If you decide to buy and improve a fixer-upper, have patience. Once the sawdust clears, you may just find the home of your dreams. On Point HomevestmentsFind out if teaming up to buy a second home is right for you and your palsGiven the current strength of the dollar abroad and the fast-moving real estate market at home, you may be thinking about buying a second home at your family’s tried-and-true vacation spot, on a sunny beach, or near your favorite ski destination. But what can your budget realistically get you? If what your vacation-home fund allows is more fixer-upper than dream home, going in on a purchase with friends or family could be a great way to get much more home for your money. If you’re considering going this route, here’s how to get started. 1. Decide if it’s right for you “The number-one reason to consider buying a house with friends is that it lowers your investment amount,” advises Bryant McClain, director of sales and marketing at Itz’ana Resort & Residences. “Unlike timeshares or fractional ownership opportunities, when people go in together and buy a property at market price, they enjoy the equity gains of the traditional real estate market.” McClain also points out that the best candidates for shared property are those who want to use the home a few weeks a year, then rent out the home the rest of the time. (Just be sure you’re correctly set up to do so.) Owners also have to be comfortable sharing ongoing expenses, like property management fees, utilities, insurance, and repairs. 2. Lay the legal groundwork To protect all owners when the unexpected happens, and to avoid hurt feelings and strained friendships, McClain recommends hiring an attorney to set up an LLC, then purchasing the home through that company. “Owning a property with friends or family is all fun and exciting on the front end, but what happens three years later when somebody wants out?” says Bryant. Your attorney can draft an operating agreement that clears up expectations on everything from how utilities are shared to how a buyout would work if one owner wanted to sell and the others didn’t. 3. Start searching Keep in mind that the vacation-home market moves quickly, and with multiple stakeholders needing to agree that a property is the one, it’s best to decide on your shared criteria before you start looking. This is especially important if you’re searching from afar or if one person will be doing most of the home touring on behalf of the group. That way, when you find the right home, you can put an offer together quickly. “Treat the whole transaction like a business,” suggests Bryant. “Make a spreadsheet with potential homes, list pros and cons, and ask everyone to vote — that’s where having an odd number of owners comes in handy.” You should also enlist a local real estate professional with expertise in the destination where you’d like to buy. That person is best qualified to help you identify homes that are a good value, that will perform well in the local vacation rental market, and that are in locations likely to appreciate. There’s plenty of legwork between “Hey, maybe we should buy a home together” and signing on the dotted line, but if you find the right people to partner with, approach it like a business transaction, and act quickly when you find the perfect home, you’ll be sitting back and enjoying your dream home before you know it. On Point HomevestmentsOnce you've got the basics, it's time to do a little more digging.Nearly every home search starts online these days. Sorting through listings, photos, floor plans and descriptions is a great way to feel out the market for those who are in the earliest stages of the home search. When you find a home you’re ready to bid on, it’s incredible how much background information you can find online. The Internet is full of data on past home sales, recorded sales prices, and the history of each sale, plus information that may not be as obvious — such as the safety of the neighborhood you’re considering buying into. Here are three ways to use online tools and real estate mobile apps to get more details about the home you want. Check building records Nearly all public information and documentation is now available online, and most municipalities provide web access to building permit history. Although the law requires most sellers to disclose previous work done on the property, there may be a history of earlier work the seller didn’t know about. For example, if there is a newer bathroom or kitchen but no history of a permit for the work, there is a chance someone did the work without a permit — and potentially not to health or safety code. And if you become the owner, this unpermitted work becomes your responsibility. To begin your search, type “building records,” plus your city’s name into your favorite search engine. Example: “building records Seattle.” Use Google Street View Researching an address using Google’s Street View can be one of the most revealing options available. Street View provides a snapshot of a property at a particular moment in time, which can provide insight into the recent history of the property or neighborhood. Be aware, however, that the image you see may not accurately reflect the home’s current state. For example, I helped a homeowner list and sell a home in San Francisco’s Lower Haight neighborhood a few years back. We planted a beautiful garden area to create a buffer between the sidewalk and the windows. But a search for the property on Google Street View revealed the windows with bars on them, and no garden. The previous owner had bars on the window, and someone had removed the bars to make the property look more inviting. Seeing the windows with bars on them in Google Street View could raise questions for potential buyers: Is the neighborhood unsafe? Was there a history of crime in the community or on the property? Are the street-level windows safe? Consult a neighborhood crime app A variety of crime reporting apps for mobile devices show on a map recent crimes that have been reported, including assault, theft, robbery, homicide, vehicle theft, sex offenders, and quality of life (which often means noise complaints). It’s an easy way to get a quick overview of how safe or unsafe a neighborhood is. So much information is available to buyers these days. You don’t need to rely solely on the seller’s or the real estate agent’s disclosures. Use online resources to find out as much background information on a property as you can, either before making an offer or during your contingency period. It is best to do as much research as possible, in order to make an informed final decision. On Point HomevestmentsSave some room in your budget for expenses after move-inBy the time you get the keys to your new construction home, you might feel stretched thin in the finance department. From earnest money and design center upgrades, to closing costs and moving expenses, buying a brand-new home is never cheap. As you take a look at the costs on the horizon, it’s wise to look a little past your closing date. There are a few post-closing costs that are unique to brand-new homes and some that are familiar to all new homeowners. Set aside a little money for these expenses now, and it’ll be smooth sailing once the “sold” sign is out front. Appliances Unless you’ve negotiated a washer and dryer into the price of the home with your builder, your new laundry room will likely be a big empty space when you move in — no washer and dryer to be found. Many builders don’t include a refrigerator either, opting instead to let homeowners choose a style that suits their needs. Here’s a tip to ease your wallet woes: Start shopping appliance sales once you know your approximate close date. Many appliance stores will let you purchase ahead of time to take advantage of a good price, then delay your delivery until you move in. Utilities If you’re upgrading to a larger home, your utilities will likely increase, especially heating and cooling. And if you’re moving to a new city or a location with a different utility company, you may have to pay a deposit to start service. If you’re interested in services like cable, satellite TV, or Internet, you may have to install some equipment that would already be installed if you were buying a pre-owned home. Window coverings Look at all those big, beautiful windows in your new home! And then notice that they’re bare — no blinds or curtains in sight. Most new homes do not come with window coverings, and they’re definitely something you’ll want to quickly look into when you move in. There are better ways to introduce yourselves to the neighborhood than through wide-open windows — or bed sheets pinned up for privacy. Furniture There’s nothing more exciting than picking up some great new furnishings and decor for a brand-new space. You may have pieces that worked well in your old space but don’t fit your new home’s layout. Or maybe you have a new guestroom to furnish, a deck that is begging for patio furniture, or beautiful hardwood floors that need area rugs. Set aside some money now so you can start decorating right after move-in day. Landscaping Did you know that some builders only landscape the front yard, leaving the backyard unfinished and unfenced? And, if your new neighborhood has a homeowner’s association, the rules may require you to finish your yard within a certain time period. That means you foot the bill for landscaping your new home’s yard, and whether you do it yourself or hire a professional, it’s still an expense you shouldn’t overlook. Setting foot in your brand-new, just-finished home is an exhilarating experience, and something you won’t soon forget. With just a little planning and saving in advance, you can spend more time making your new house a home, and less time stressing over how you’re going to pay for it all. On Point HomevestmentsToday’s greatest real estate investors know it, and it’s about time you did, too: real estate trends, or at least the ability to translate them, can prove invaluable to the advancement of one’s career. Real estate market trends are, after all, the perfect indicator for divulging not only where a market has come from, but also where it has the potential to go. The more investors know about today’s emerging trends in real estate, the more likely they will be to realize success. But, of course, not all trends are created equal; some are inherently more valuable to follow than others. The key is to identify the trends most likely to last and capitalize on the position they may place you in. Real Estate Market Trends Impacting Buyers & Sellers This Summer The weather is on the brink of heating up in nearly every real estate market, and that means one thing for those with their finger on the pulse of the national housing sector: things are about to get a lot more interesting. If for nothing else, the summer real estate market represents the busiest time of the year. It is at this time when the whole of the entire housing market gains an incredible amount of momentum from both buyers and sellers. It is worth noting, however, that the summer real estate trends of 2018 look perfectly comfortable mimicking those of the previous years. The trends we have seen up to this point, and even the trends we should expect for the foreseeable future, are to be expected. To be perfectly clear, there are a number of real estate market trends that are impacting buyers and sellers this summer, not the least of which include:
It shouldn’t surprise buyers or sellers to learn that these trends look like they will carry over into summer. That said, it would be wise to familiarize yourself with them on a more intimate level. The more you can expect to glean from the upcoming summer real estate market, the more likely you are to navigate it with success. Who doesn’t like the sound of that? If you are interested in giving yourself a competitive edge this summer, you’d be wise to learn as much as you can about what to expect. Home Sales Of the real estate market trends most likely to carry a lot of weight in today’s investor landscape, home sales deserved to be talked about first. It is home sales, after all, that serve as one of the most important market indicators for gauging an area’s health, and those that take place over the course of summer are no different. Home sales will take place at a fierce pace this summer. According to Zillow, the average home lasts on the market for 78 days, but don’t get to caught up in that number. If anything, that number will witness a decrease in the coming months, as it does every summer. Case in point: home sells will speed up as the competition heats up. There are simply too many buyers eager to get into a new home, and summer appears to be the time they hope to do so. As an investor, take note of the speed in which buyers are willing to move; it’s one of the real estate trends most likely to be maintained by the state of today’s market. High Demand And Affordability Few housing markets across the United States, if any at all, have managed to solve the largest problem facing the real estate landscape: inventory levels, or lack thereof. More specifically, however, supply and demand is currently dictating today’s exponential increase in prices. It is worth noting, however, that demand hasn’t taken a step back. The economy is better off today than it was even a few short years ago, and there are more buyers looking to participate in the housing market, but there’s one problem: there aren’t enough homes to satiate demand. All year, in fact, prospective buyers have wanted to partake in the market, and have been met with opposition around nearly every single corner, and it doesn’t look like this summer will offer a solution. That said, investors should go into summer knowing that they aren’t alone. The next few months will be competitive to say the least, which means success will favor the prepared more than ever. As an investor, factor the competitive nature of today’s market trends into your acquisition strategy. Instead of low-balling sellers, try offering a little more, or even exercising an escalation clause. Real estate price trends suggest inventory levels will only continue to drive up prices, so be prepared for the cost to go up. Doing so could mean the difference between having your offer accepted or ignored. Hot Markets Hot markets are, for all intents and purposes, a relative classification. Nearly every market in the country is firing on all cylinders at the moment. However, there are markets that are doing better the others. Most notably, the California real estate market appears to be setting an incredible pace. Whether or not that pace is maintainable remains to be seen, but there’s no denying the activity currently taking place in The Golden State. More importantly, the California real estate market has several of the “hottest” markets in the country, not the least of which include:
According to Realtor.com, California accounted for 13 of the top 20 hottest housing markets as recently as the first quarter of this year. Real Estate Technology Trends The advent of technology has certainly shifted the way things are done in every industry, and the housing sector is no exception. Real estate technology trends have drastically improved the way people take on what can be, at times, an intimidating industry. Real estate technology serves one purpose: to make our lives easier. It is safe to assume that investors using the right technology are at an advantage over those that, well, aren’t. The key, however, is to adopt the right technology. There are technological advancements that are far superior to others, and it’s in your best interest to use those that will give you the best edge. Here are some of my personal favorite real estate technology trends at the moment, and how they can advance your career:
Commercial Real Estate Trends Real estate market trends aren’t relegated solely to the single-family landscape; they are also present in the commercial sector. Here are two of the most important trends investors should be keeping an eye on this summer:
Emerging trends in real estate don’t necessarily have to come out of nowhere. The majority of the real estate trends I spoke of here are the result of months, if not years, of anticipation. They are now trends because they appear ready to carry over the momentum they have already generated into summer. It is worth noting, however, that those aware of what’s going on stand a better chance of realizing success, and today’s investors are no exception. If you want to give yourself an advantage over the competition, be sure to listen to what the market is saying; it may be the only thing you need to take your career to another level. Key Takeaways:
On Point HomevestmentsRegardless of which stage of the real estate business you are in, there will be times when you feel overwhelmed. Most successful investors will have a good mix of new leads coming in with deals headed to closing. You may also have a rehab you are currently working on, as well as a few rental properties that can eat up some of your day. As much as it would be nice to be everywhere at once, you can’t replicate yourself and be in multiple places. The only thing you can do is to become a more productive real estate entrepreneur. If you maximize every minute you are working, you will find that you may just have all the time you need. The most successful people in real estate don’t just wake up in the morning and deal with issues as they come. This isn’t to say that there won’t be curveballs thrown at them throughout the day, but they start the day with a plan. This means taking a few minutes before they go to bed to write down what needs to be done the next day. A good list will give you something to revert back to when things get hectic. It will give you a battle plan of sorts: what needs to be done, when and who is going to do it. The more detailed you are with your list, the more efficient you will be. Simply jotting down five things that you sort of want to get accomplished is not enough. You should allocate time to when you are going to accomplish these tasks. Some people will only return emails or texts a few hours in the morning, and then again in the afternoon. Some will deal with sellers after dinner while others will visit their rehabs after lunch. How you arrange your day isn’t important. Sticking with your schedule is. There will always be days that you will have to deal with an unexpected emergency, but for every other day, you need to stay focused on your schedule. This will help you finish the task you are working on before you move on to the next one. Multitasking is great, but stopping and starting five different things at once isn’t multitasking. Do one thing to completion and then move on to the next. It is great to accomplish tasks off your list, but you should prioritize them with what is most important to your business. This may not necessarily mean working on deals closest to closing, but what is the most important task you want to accomplish for that day. Every list you make should revolve around getting it done. It is human nature to relax a bit when you accomplish something, but that should not be the highlight of your day. Once you handle one thing, you need to quickly move on to the next and keep things going. One of the mistakes investors make is thinking they need to work 100 hours a week to be successful. This is a recipe for disaster. You can work yourself into the ground in this business. Working 30 productive hours is far better than working 60 that you split looking on your phone or thinking about what you are going to do next. When you work during your day, make sure you are really working. Real estate investors, by nature, are control freaks and like to do everything themselves. There is a fine line between saving money on a do it yourself project and wasting time that is better spent elsewhere. Regardless of who you are, there will be times when you need to lean on your team or allocate tasks to others, even if it costs you money. Instead of focusing on how much it would cost to hire someone, think about how much you can gain by not having to spend the time to do this. Your realtor, attorney, mortgage broker and accountant all work with you towards the same goal. Everyone wants to close deals. If you have a question, you should feel comfortable enough to call or send an email and have a response back by the end of the day. If you can’t lean on your team when you need them, you should reconsider your relationship and think about finding someone else. Social media and technology are great, but they can also be a distraction if you are not careful. If you complain about not having enough time in a day, you can probably gain two to three hours just by waking up earlier, going to bed later, eliminating an hour of TV or cutting down on your technology use. If you want to get the most out of your day, you will have to make some sacrifices along the way. How you work is always more important than how long you work for. There is not much that separates an average investor from one that is very successful. Getting one or two more tasks accomplished or working on one extra deal every day can get you over that hump. There are only has 24 hours in a day. The best investors are the ones that know how to use them. On Point HomevestmentsReal estate exit strategies have become synonymous with some of the most popular wealth-building vehicles used by today’s greatest entrepreneurs. Not only are they entirely capable of awarding savvy individuals with an impressive return on their investment, but you could argue that few other investing platforms offer a more diverse set of complimentary choices. Wholesaling, rehabbing and passive income opportunities are just the beginning; which one will you choose to pursue? The answer may be easier to come up with than you think. No other industry, as far as I am concerned, offers investors more ways to invest their capital than real estate, but I digress. The same freedom of choice most covet is not without its own caveat: with more choices comes more responsibility. With the entire real estate investing world at your fingertips, it’s easy to get in over your head. That’s why I recommend tailoring your real estate exit strategy to compliment your current level of experience. Not everyone is capable of successfully navigating all of the real estate exit strategies simultaneously, nor should they be expected to. And while there are those who can manage a rehab with one hand tied behind their back while simultaneously assigning multiple wholesale contracts, it’s not reasonable to expect a new investor to be able to do the same. The key is to know your own limitations and identify the exit strategy you are most comfortable with. Truth be told, there is a time and place to initiate a real estate exit strategy, and it’s not uncommon for your personal experience to dictate which real estate exit strategy you should execute next, or even first. And while experienced investors are free to choose whichever strategy meets their needs, those new to the industry should follow what I like to call the path of least resistance. There is a specific order I would recommend investors follow when exercising their freedom to invest in real estate exit strategies. I want to make it abundantly clear: the order in which you invest in real estate exit strategies isn’t set in stone. It’s entirely possible for a new investor to invest in a buy and hold property or a rehab as part of their first deal. It’s worth noting, however, that the growth of an investor is made easier by following a specific path; the one of least resistance I set out for you here. There is an inherent advantage of moving from wholesales to rehabs to rentals. The skills you learn in each strategy compound in the next, and are ultimately invaluable to your success as an investor. Real Estate Exit Strategies: Where Should You Begin?Whether you realize it or not, there is an order in which investors should get their feet wet in the world of real estate investing. And while what I am about to tell you is in no way written in stone, I am convinced that there is an order in which real estate investors need to commit to individual exit strategies: wholesales, rehabs and rentals. If for nothing else, undertaking real exit strategies in this exact order offers the smoothest transition from one strategy to the next. Wholesaling, for what it’s worth, represents the “easiest” gateway into the real estate investing world. Not only is it less of an undertaking than it’s rental and rehabbing counterparts, but wholesaling generally coincides with significantly less risk. As a wholesaler, your main priority is to go into contract with a respective seller, market the home to potential buyers, and assign your control of the contact over to the end buyer. More often than not, wholesalers never even need to assume ownership of the physical property; just the rights to purchase it. Once the seller has signed a contract saying you own the rights to buy the home, you can then turn around and sell your purchase rights to an interested buyer (usually a rehabber) for a minimal fee. Alternatively, wholesalers can also close on the property and immediately resell it to another investor in the form of a “double close.” It’s worth noting that certain regions have different laws regarding wholesaling, so be sure to check with the home’s local municipality before moving forward with a wholesale deal. As perhaps the most popular real estate exit strategy, rehabbing has become ubiquitous with the largest profit margins. And as the name suggests, rehabbing will have an investor buy a home, renovate said home and sell it for more than the initial investment (including repairs). The idea is to acquire a property for less than the market dictates and apply the necessary renovations that will make it comparable to similar homes on the market. It’s entirely possible, with the right improvements, to increase the property’s value beyond that of what you have already paid. Not surprisingly, rehabs coincide with considerably more work than traditional wholesales. As a result, rehabs expose investors to more risk and cost a lot more money. Having said that, rehabs are capable of making investors a lot more money on the back end of a deal. And with the right measures put in place, it’s entirely possible to mitigate risk. It’s also worth noting that the experience you gain from a wholesale can transition over into a rehab, and actually contribute to your efforts in a meaningful way. While some investors have found their niche in today’s wholesaling and rehabbing markets, there is a good chance they will want to graduate to our final stop on the path of least resistance: passive income. Otherwise known as a buy and hold strategy, passive income is essentially the result of a well-devised rental portfolio. And since the price of admission will have investors buy and hold on to a mortgage, this particular strategy requires more money up front. That said, most investors use rehabs as a stepping stone until they can finally transition to passive income properties. Buy and hold real estate exit strategies will have investors buy a property, and perhaps even conduct a few renovations. However, instead of selling the home, the idea is to rent it out. More often than not, investors will use this strategy when home prices are high to recoup any capital they expended acquiring the property. This is also a popular real estate exit strategy for those looking to build up equity in an asset. With property in hand, its entirely possible for any tenants you find to pay down the mortgage, making this a great strategy for those looking to not pick up a hammer. RESIDENTIAL REDEVELOPMENT COMPANYKey Takeaways
As you embark on your investor career, it’s possible you might have heard about the concept of the real estate investing club; you might have even wondered what a real estate investing club is. How does this most valued of business networking tool actually work? And what’s the best way to get the most out of this unique form of business networking group? A real estate investing club is a group, composed of both beginners and more advanced real estate professionals, who get together to network and pool knowledge and resources. There are many benefits to this type of investing network, but some of the key ones include shared knowledge, the ability to grow your network, and reduced prices on training and courses. Here’s a simple, step-by-step guide to finding and benefiting from a real estate investing club. How A Real Estate Investing Club WorksWhat They Are A real estate investing club is an organization composed of real estate professionals, of all experience levels. This can either be in a formal or non-formal setting, depending on the needs of the business and social networking needs of the club. By bringing together both experts and beginners, the club becomes a source of industry information — a place where people can feel safe and ask questions or trade knowledge. Connections are created through shared experiences, and members learn how to compete against big players in their market. Investing clubs best benefit those just starting out in their business, but it isn’t just real estate investors you will meet: You’ll also meet investment analysts, lawyers, accountants, contractors, and negotiating and closing specialists. Benefits of Joining Investing Clubs As with any other industry, the right kind of network can help you succeed. Here are some benefits an investing club can bring to your business: 1. Education The real estate industry is constantly changing. While you may have access to industry news, members in a club might have access to insider information you can’t find otherwise. In a club, you can take advantage of:
2. Discounts On Courses Being a member of a real estate investing club will often give you discounted access to workshops and seminars that non-members would usually have to pay full price for. Some courses delve deeper into the real estate investing trade, while others take a more general approach on topics like budgeting, accounting, or how to run a business. Either way, many of these courses will be able to teach you a new skill that can come in handy in your day-to-day operations. 3. Expanded Network Some investors believe the best social networking tools for business are all done on a computer, but perhaps the biggest advantage of joining an investing club is the expanded real estate network you will build in person. However, plenty of beginners make the mistake of arriving right before a meeting starts and leaving right after it ends. The real benefit happens after an event, when those business cards for networking find their biggest impact. During that time, you’ll be able to:
When in an investing club, the important thing to remember is to be visible. The more people you know, the bigger a real estate network you can build. 4. Store Discounts A lot of investing clubs strike partnerships with local stores that help real estate professionals. This can come in handy, especially if you are also managing your own properties. Discounts from Home Depot, Office Max, and many others can help lessen the costs for repairs and maintenance. 5. Free Real Estate Website With the value of online visibility rising, some investing clubs also provide free professional real estate websites you can use for your portfolio. Post your property listings, as well as various forms your clients can download (e.g. buyers/sellers forms, tenant forms, etc). Always include your contact information and respond promptly to messages. 6. Move Closer To Your Goals If you feel you’re stuck in business quicksand, and not hitting your short and long-term goals, joining a club is a great first step towards remedying that. It can take away the guesswork of running your business, since you will learn how fellow investors did it. This may sound like a simple thing, but often times knowing exactly where you’re going — and what it will take to get there — can be the most important benefit of a real estate investing club. Have you joined a real estate investing club? Let us know your experiences in the comments below. On Point HomevestmentsMany people are still wondering whether or not real estate is one of the best investment strategies for long-term wealth building. Is investing in homes still a smart investment for the average individual? Is a home still the best investment of a lifetime for most Americans? If so, why are some pessimists still questioning the rebound in the news? Behind the Headlines Real estate companies will always boast about the benefits of acquiring real estate because it is their job. That is, unless of course, they have gotten into the rental business and make their money by touting the benefits of renting instead. Let’s be honest; statistics can be found and twisted to support any point of view and argument. Entire years of real estate statistics have been revised in the past, new indexes have been created to restart the clock, and even the national GDP was revised. Most don’t even bother to tune into job and unemployment numbers anymore due to how skewed different data sets have become. Even though the most conservative figures show housing rebounding, especially in hot areas like San Diego, there continue to be doubters. However, it doesn’t take much more than a little common sense to figure out real estate is still the best investment for most of the population. This applies to affluent individuals with top 1% income, as well as those that need to pinch pennies. Stocks have continued to demonstrate extreme volatility and risk. While UT San Diego reports local real estate is still 50% undervalued. In the stock market, plenty of Americans have lost 6 figures, literally overnight. Direct investment in real estate isn’t that volatile, and nothing is ever lost until a property is sold. For example; some Southern California homeowners saw their home values rise and fall on paper during the last couple of decades, but if they don’t sell for a few more years when prices exceed their previous peak, they will come out handsomely. Invest in Real Estate, Even if You Can’t Afford Your Dream Home One of the top excuses for many not to buy a house is that they can afford their ideal dream homes yet. Of course, unless they invest in real estate in some way now, the odds are against them ever being able to afford that dream home. Incomes haven’t been going up, but rents and home prices have. Those wanting to buy a home should not invest any money in stocks or bonds, but should prefer cash. Of course, in reality, cash depreciates too. It can be at risk whether it is in the bank or under the mattress. Investing in real estate is the best way to build up more wealth and cash to buy that dream home. Can’t find a home you’d live in even for a few years? Then buy a rental property. Many Americans are sadly being seduced into the lifelong renter mindset without realizing the horrific consequences it could be dooming them to. Consider those paying 50% of income in rent right now. Rents have been going up 20% a year in many places. If rent goes up another 20%, many could be priced out of both buying a home and renting too! Then what? With Americans living longer, and with company retirement plans evaporating, they also need to consider where they will live for 40 years of retirement on limited income? Even legendary billionaire investor Warren Buffett, with all of his endeavors into energy, insurance companies and holding sizable stakes in companies like Coke and Wells Fargo, still calls his own home his best investment ever. On Point HomevestmentsWhat can you do to effectively groom the next generation of successful real estate pros? Whether you are a real estate investor, agent, owner, entrepreneur, or just wanting your heirs to do better at buying and selling homes; grooming the next generation of real estate pros is critical to the industry. Therefore, how can you contribute to the development of said individuals? The following tips will help to facilitate the talents of the next generation of real estate pros: 1. Education Invest in real estate education courses and pass the materials on. Gift them a course, whether they are 13 or 31. It will keep on giving when you can’t, and unless they have this knowledge, they won’t manage any portfolio you pass down very well. Similarly, turn them on to practical business and financial education so that they can not only make great incomes and continue to build wealth but handle it wisely too. 2. Develop Strategic Thinking Make developing strategic thinking fun with games like Monopoly, chess, Risk or even a healthy dose of Xbox. Empower them with the ability to think ahead, navigate challenges and constantly innovate. Using newly available innovations will help groom the next generation of real estate pros. It is never too soon to start teaching them the fundamentals of real estate. 3. Hands on Practice Drive neighborhoods together, tour homes and point out what makes a good deal or doesn’t. Discuss ways to structure deals, have them operate a virtual test portfolio to see how they would make out based upon their decisions, and perhaps most importantly, make sure that they are aware of how housing cycles work. If you aren’t an active real estate investor, agent or business owner yourself, find them summer internships with those that are. HomevestmentsAre you too young to start investing in real estate? A whole new generation has been introduced to real estate investing opportunities across America, but how old do you need to be to jump in and participate? What do you really need to establish yourself and become a success? Due to some legal restrictions and banks pursuing defaults on mortgage loan debt, prospects may be restricted until they are at least 18 years old. However, that isn’t stopping everyone. Recent news stories have highlighted several cases in which teens have taken the plunge and made out very well. It is true that there really hasn’t been a better time than now for both flipping houses and acquiring rental homes. With a little innovation, anything is possible. There is a huge surge among younger generations that are full of passion and energy, wanting to get in and make their millions from real estate investing. It’s great, and no one should allow their age to hold them back. There are multiple reasons to begin real estate investing, regardless of age. Of course, while ambition and excitement can provide powerful momentum for young real estate investors, it is essential that they do not fall into the same traps as those that were their age when the last housing bubble burst. This means obtaining a decent amount of real estate education. Just getting the technical aspect of buying and selling homes isn’t enough. There is a need for strategy and understanding housing cycles. A long term vision is required to make sure you aren’t caught short when fluctuations do occur. By comparison, you are never too old to begin investing in real estate either. In fact, older generations will find it to be one of their best allies in setting up passive income streams and boosting nest eggs. RESIDENTIAL REDEVELOPMENT COMPANYPerhaps you have caught a glimpse of a few reality TV shows about flipping houses and have wondered if it is for you. It is true that there can be great money to be made form real estate investing but there are actually many reasons to get it. Here are just a few of them… 1. Bigger Paychecks For most of America there are few businesses to get into that can produce the big paydays that real estate investing can. Even doctor’s salaries pale in comparison to what many investors make. Whether you already have a job and you hate it or it just isn’t ever going to give you the paycheck you crave or you are currently unemployed real estate investing may be just what you have been looking for. 2. Passive Income If you want to retire comfortably, early or even retire at a reasonable age at all anymore you are going to need more than a couple hundred thousand in the bank. You are going to need an income to live on. By building a portfolio of rental properties which produce passive income every month you can retire early and enjoy life now. 3. Create Real Wealth Making a lot of money isn’t the same as building real wealth. Rappers can make a lot of money, CEOs of corporations make fat paychecks and many sales people see big paydays. You can even win a few million playing the lottery but building real wealth that will last generations turning your family into ‘old money’ and enabling your future great grandchildren to really pursue their passions is one of the best things about real estate investing. 4. Helping Others One of the greatest things about real estate investing isn’t about money at all. It is being able to help others. You can help homeowners get out of debt, buyers to put a roof over their family’s heads, young families to give their children the benefits of home ownership and even help others support themselves and enjoy a great lifestyle through real estate investing. 5. Freedom Real estate investing not only delivers great paychecks but can also allow you to do it in far fewer hours a week than any 9-5. It can take work and effort to get started but with the right real estate investing system you can build a great business that gives you time to enjoy your other passions too. 6. It’s Fun There are lots of things you can do to make money but investing in real estate and flipping houses is fun and rewarding too. From remodeling houses, to meeting new people, visiting amazing properties and the thrill of the deal you will find yourself easily hooked. RESIDENTIAL REDEVELOPMENT COMPANY |
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