In real estate investing, those who inspire me AND who I admire are few and far in between.
One of the greats is Kenny Rushing, out of Tampa, FL
The following is a post from his facebook page - and it's VERY relevant to those who want success:
"I just wrapped up banging out the phone since 9 am. I went back over my old real estate leads. In total I had over 122 houses I either passed on, the seller and I couldn't agree on price or the seller changed their mind. From the list I have 29 houses I'm rehashing and renegotiating, inspecting and hopefully making offer this week. I decided not to increase my advertising budget in April until I go through all these leads. At $10, 000 a pop could be a $250, 000 come up. Worse case scenario I'm confident I will contract to buy & sell at least 5 and that's worth 15 hours of communication with prospective sellers. If you are an investor don't over look your old leads they can turn into new money!"
Walks the talk and so should you if you want that success !!
Thanks for the inspiration, Kenny !!
Through all the lies, deceptions, resulting bank and investment failures and crashes, real estate is making a "comeback".
Isn't that amazing ??
What I find amazing is people's responses to market fluctuations.
What we experienced from 2007 through 2012.......and into this year, is nothing new.
As time and technology move forward, so will economic turmoil.
It just IS a part of the game.
Real estate investing, like all investing, IS a game.
Obviously, the object is to time your investments most optimally, but history shows us that many of us miss the mark.
Lesson here is to NEVER risk what you can't afford to lose.
That's it - plain and simple.
Risk is great, but knowing and understanding how to leverage your risk will always be the difference between market crashes and your portfolio.
It's amazing what a little "real world" education can do for you.
Good luck and stay safe out there !!
The Federal Reserve most popularly known as the FED is entrusted with the task of overlooking the United States economy. It is the national bank of USA and is recognized as one of the most dominant institutions across the globe. The FED is entrusted with the task of setting the monetary and fiscal policy of the world's super power, America, which impacts not only the local citizen but the global population. The FED was created in 1913 by the United States congress. Before the formation of FED, the USA had no formal institution that was entrusted the task of setting and regulating the monetary policy. The resultant impact was that the markets were volatile and the banking system was not regarded as robust by the public at large. FED was created with the aim of formation of an institution that was solely responsible for regulating the banking system of USA. The FED is an independent organization and does not require the president to ratify its decisions. Nonetheless, the congress is entrusted with the task of overseeing the workings of the organization on a periodic basis.
Boards of Governors of the FED are based in Washington and are responsible for heading the organization. The BOD is headed by seven presidential members all of whom must serve a fourteen year period. The presidential members must be approved by the senate and can be required to serve another terms based on circumstances. The board is headed by a chairman (currently Ben Bernanke) who is initially appointed by the president of USA while the senate must approve the member. The chairman is required to serve a four year period and is assisted by a vice chairman.
The BOD is responsible for overseeing the work of twelve regional branches of the FED which are situated in the chief cities of USA. The Reserve Bank is entrusted with the basic workings of the FED and operates as the major system within the workings of the central bank. The banks are responsible for generating their own revenue from various sources. These include the services that they provide to other banks, the interest income from government securities, income from any foreign reserves and interest income on debt of depository organizations. The income generated from various sources is used to finance the daily working capital cycle whereas excess income is transmitted back to the U.S treasury. Lastly, all national banks operating within USA are referred as member banks and are a division of the FED. A couple of state-chartered banks are also referred as member banks.
Federal Open Market Committee (FOMC) is a part of the FED and is responsible for deriving the policy implemented by the FED. The chair of FOMC and the BOD are the same whereas the voting members consist of presidential candidates from BOD, four Reserve Bank presidents and Federal Reserve Bank president. These members are required to serve on a rotation basis pertaining to a one year time period. Reserve Bank presidents are required to participate in the policy making process irrespective of the fact that they are granted the voting rights or not. The FOMC has the final say in a number of significant matters including the monetary policy and specifically the interest rate.
The underlying theme of FED is to ensure economic growth, employment, low levels of inflation, stability of purchasing power parity and reasonable interest rates over a long term period. Simply put, the FED is responsible for ensuring stability and sustainable economic growth. The duties of FED are therefore widespread and are concerned with ensuring the smooth running of the economy.
The FED provides a number of services to banks in a similar manner as a bank might provide a service to a citizen. This is done so that the national payment process is efficient and secure. For example, transfer of money from one bank to another might be aided by the FED. The most important duty of the FED concerns serving the government of USA. The government of USA is the higher spending customer of FED. The FED is responsible for maintaining the checking account of the US treasury whereby the inflows and outflows of cash are regulated by the FED. Any inflows that arise due to tax revenues and outflows pertaining to government spending are passed through this account and the FED is responsible for handling them. The FED is also responsible for dealing with government securities whereby selling and buying transactions pertaining to bonds and treasury bills is conducted by the FED.
The FED is also responsible for issuance of currency in form of paper and coins. Although the US treasury is responsible for the production of cash, the FED is the institution that is responsible for allocating it to financial organizations. The FED duties also extend to checking the bills for damage and ensuring that bills that show signs of wear and tear are taken out of the cash cycle.
Another duty of the FED is to regulate and supervise the other banks operating within the USA economy.
The other banks include the member banks, international banks, foreign transactions of these banks and banks that are USA based but operating abroad.
The FED ensures that the banking policies are in line with customer's best interest and many laws and regulations have been enacted that ensure that the banking activities are bona fide to the public.
The responsibilities of the Federal Reserve Bank extend to the investors as well whereby they are responsible for setting the limits on the debt that an investor can take.
Last but not the least the FED is responsible for setting the monetary policy of the economy.
This is one of the most important duties of the FED whereby the FED ensures that the interest rates and money supply result in positive economic growth and development.
The three basic tools used by the FED include:
A) The open market operations
B) Discount rate
C) Reserve requirements; all of which are adjusted to reflect the current monetary policy devised.
There are few things in this world that may be more important to a society than the importance of investing in education. It is unlikely that there is ever a point in anyone's life where learning and furthering yourself becomes unimportant or unnecessary. There are many advantages for a society, culture or country to encourage a person to keep learning and to invest their resources into making education available to anyone who desires it.
On a national level, it is important that a country puts as much as they can towards encouraging people to learn more. It is only through education that people are able to improve themselves. As a person begins to learn more and more, it can help them move ahead in the world.
One of the most important factors for helping to escape from poverty is education. When a person is willing to learn, it not only gives them more knowledge of the world around them, it also equips them with the tools necessary to get ahead. With the proper education, they will be able to secure a better job, thus putting them on the path to future success.
Nationally, it is important for a country to be willing to put in the necessary funds to provide for quality learning not only for its adults, but especially for the children. The children need to be encouraged to learn as much as possible if a country or society wants to keep growing. It is the children who are the future of the society, and the more they know and can assist in the growth of the civilization, the better off the culture will be as a whole.
On a more personal level, it is important for each person to understand the necessity of not only investing money but time into educating themselves and their family. It is something can only benefit all involved down the road. An initial monetary layout for a person to go to college will certainly pay dividends when that person graduates.
If you want to be able to compete in this ever-growing, ever-changing world, then you need to be willing to put in the necessary time and money. Technology has vastly changed the world as it is today, and it has progressed because people are willing to make the outlay needed. It is only by educating yourself that you will be able to keep up with everything.
It is only through the work of both the government and the people together working towards education goals that a society will succeed. The government needs to be willing to set aside funds needed for services and teachers to make this work. The citizens then need to put forth the effort for themselves and their children to embrace these policies.
Investing in education is something that many state and local governments have examined closely, looking for ways to cut funding and budgets. This may prove to be a mistake. The only way a society can continue to grow and prosper is through proper education.
2012 is a pretty damn amazing year – for real estate movers and shakers.
With properties priced at pennies on the dollar, this 2012 real estate market is even a little overwhelming.
It’s a divided market – with bountiful opportunities for buyers and teeth grinding frustration for lots of sellers.
Relating to the sellers, many have removed their real estate from the markets – hoping to hang on and wait until values start to climb again – but nobody really knows when that will happen, though we all speculate, don’t we ?
For the sellers who can’t hang on AND owe more on their real estate than they can hope to sell for, it’s a tough go.
They have to do a short sale or be foreclosed – because they can’t hang on.
Bottom line is that no real estate market is perfect – and some people get hurt. You’ve heard that saying a million times – “you can please some of the people some of the time, but you can’t please all of the people all of the time”.
Getting back to WINNING (Sorry Charlie), buyers are kicking ass now – CASH BUYERS.
Conventional buyers with less than perfect credit scores are having a tough go, because lenders have tightened up on lending – which sucks and makes no sense – to me.
Back in 2000, 01, 02, 03, 04, 05, 06 and 07 – even in 08, banks were lending to everyone – housing values were at all time highs and banks were betting the farm by writing loans to countless borrowers that THEY KNEW would not be able to repay.
Yeah, those ARMS (Adjustable Rate Mortgages) were made to fail, and “pioneers” like Countrywide were at the forefront of developing all kinds of products for bad debts – uh huh !
Ok, so you know the rest – numerous banks went belly-up when record amounts of loans began to fail and here we are, in 2012 – still trying to come out of those dark times.
WINNING ? Yes, cash buyers are the big winners, in this market. Sellers who can hang on are also – probable- winners, though only time will tell.
Loan Mods, Write Downs (Do they even exist ??), Short Sales, Foreclosures – they’re all going to continue in 2012 and well into 2013 – in my humble opinion.
However, I do believe that values are starting to climb, now, even as REOs(Bank-owned properties) are flooding the market.
I also believe that lenders will start to loosen up – because they really swung from one extreme (lending to everyone AND their grandmother (Sorry granny – I couldn’t resist)) to another (lending to, hardly, anyone).
It’s time to move back to the middle and rebuild -
WINNING ? If you can, take advantage of this market, because nobody knows how long these scratch and dent prices will last, but I think it’s safe to say that, if we’re NOT already at the bottom of housing values, we’re close enough and the ride, back up, is going to be a sweet one – for those who get in now.
Opportunity - LOTS of opportunity AND mortgage rates are at all time lows -
At the time of this writing, rates are in the 3s !!
Rates in the 3s, combined with an abundance of discount priced housing really does present an amazing opportunity.
Are you taking advantage of this market, or sitting on the sidelines, contemplating if this is the right time ?
Here's a fact:
Real estate markets are, and always have been, cyclical.
They rise and fall - with no set time when they'll move on to the next cycle.
Here's Another Fact:
Real estate has produced more wealth than any other investment -
Investors know there's no guarantee relating to when values will rise or fall - then again, there's few guarantees in life.
The list of names/companies is a loooooooong one, who have found success in real estate. Smart $$ knows that any success is built on risk - and knowing when/how to leverage that risk is the difference between success and failure.
In your lifetime, has there ever been the abundance of balance between discount real estate and historically low mortgage rates that currently exist ?
Do you think it will stay like this forever - that this is the "new" normal ?
Those investors who get in, now, will be those investors who enjoy the value increases that are sure to come - history repeating.
Here's One More Fact:
When everyone starts getting in, that's when it's time to cash out and move on to your next opportunity.
Get in, now, before you're caught up in the wave as opposed to riding the wave in, Kahunas !!
Nobody wants to catch a falling knife. It is as simple as that. If potential buyers see continued home price erosion, they will stay parked on the sidelines. But as with everything else in this unique and historic housing market, perhaps the usual logic doesn't apply.
“Housing is one of the great investments right now. I tell people all the time when they come up to me, they say, 'What should I do, Mr. Trump?' I say go buy a house," said Donald Trump earlier today on CNBC.
"It wouldn't be an obvious mistake to buy a house now," hedged Robert Shiller, barely a few hours later.
Perhaps they were just jumping off Warren Buffett's declaration Monday that if he had a way to manage them, he would buy a couple hundred thousand single-family homes and rent them out.
Housing appears to be rated a "buy" these days, especially among investors, who see a ripe and rising rental market and big potential for income. But is it the right time yet for what I call "organic" buyers to get in? By this I mean people buying a home to actually live in it, raising a family there and letting the dog run around in the backyard. If prices are still falling, couldn't an even better deal be waiting down the road a bit?
No. House prices will continue to fall on a national basis at least through 2012, but you have to look past national headlines to your local market, which is likely recovering nicely already. The trouble with the national numbers is that they are heavily weighted toward the lower end of the market and its distressed end.
About 73% of homes that sold in January were priced below $250,000, according to the National Association of Realtors. Forty-seven percent of homes sold that same month were considered "distressed," which is either a foreclosure or a short sale (where the lender allows the borrower to sell for less than the value of the mortgage). With all the activity in these areas, no surprise that prices skew lower.
The $250,000 to $500,000 price range may now be the sweet spot for the market. Sales in January were up in this price range, and if you have good credit, you are within GSE (government-sponsored enterprise) and Federal Housing Administration loan limits in most markets. While the FHA just raised its insurance premiums, which may hurt much-needed first-time homebuyer demand, it is still one of the best loan products out there today, especially for those with lower down payments.
You cannot time housing any more than you can time the stock market. True, housing moves far more slowly, but that works to its benefit, as prices don't rise and fall on daily news or even on major events. Sales have clearly bottomed out in housing, and prices always lag sales. They will lag longer this time around, no question, but they will come back. Supply and demand will eventually win out, even after a historic crash. If you can't get a good mortgage now, then perhaps it's not your time, but if you can, waiting may not buy you much.
Anyone can invest in real estate and now is one of the best times to learn how. Property values throughout the U.S. are lower than they have been in the past 50 years. This is not news to anybody, but what seems to be news is the prospect of taking advantage of these low prices and buying real estate at huge discounts while you still can. Understandably, people have been a little shaken over the recent crisis in real estate and the lending practices that took place. Taking a bit of time to educate yourself on the advantages of investing and you'll discover that with some of this knowledge you will no longer have to be so apprehensive about it.
Let's look at the top 5 reasons to invest in real estate.
1. Cash Flow - whether you buy with all cash or use today's favorable financing with a low mortgage payment, positive monthly cash flow will occur when the monthly debt is subtracted from the monthly rent. Thus giving you a monthly income from your rental investment.
2. Appreciation - Appreciation is the increase in the property's value, which generally occurs over time and can be increased by investors who add value to the property through repairs and enhancements. This is also a way to create equity in the property.
3. Depreciation - Even with an increase in the property's value the government allows owners a tax deduction of their property over its life span.
4. Tax Benefits - In addition to depreciation, an investor can usually claim the interest portion of his monthly mortgage payment as a tax deduction.
5. Leverage - Leverage is a powerful reason for investing in real estate. If an investor used 100% cash to acquire a house worth $100,000, and the house increased in value by $5,000 in one year, then the investor made a return of 5% (assuming no other costs in this case). However, if the investor obtained 80% financing, only $20,000 cash would be required at the closing table, and a bank or other lender would loan the remaining $80,000 to acquire the property.
Assuming the same $5,000 increase in value, the investor's cash contribution of $20,000 would yield an increase in equity of $25,000 in one year, a 25% return on investment. Taking advantage of the other benefits to investing in real estate, such as cash flow and the increase is even much greater.
With the above example, if the investor is able to bring in even a conservative amount of cash flow per month of $200 this will result in an additional $2,400 per year added to the increased appreciation. Even if the property value stayed stable with no appreciation, you would still see a positive return on your investment.
Adding to these benefits the recent low prices of real estate and the low interest rates for financing and you can see how easy it is to accumulate wealth and become a successful investor.
Driving through any just about any neighborhood, you will find homes that have overgrown, unkempt lawns, a stack of freebie newspapers on the front steps, no curtains in the windows, and basically just a "nobody lives here" feel to them.
These are the properties that you are looking for. Once you find one, you need to act quickly to seize your profits!
When you locate a property that you feel is vacant, the first thing to do is attempt to locate the owners of the property. First and foremost, go to a neighbors home and ask if they know anything about the home and its former occupants. Many times a neighbor will be a gold mine of information, and they probably love to talk!
When they start talking--listen up!
Take out your notepad and begin taking down all of the information they care to share. Do understand that much of this info may be speculation and gossip, but there may indeed be a nugget of truth in there somewhere.
If they indeed say that the property is vacant, you may want to sneak a peek at any old mail that may have been delivered and not forwarded. It is illegal to take mail out of the mailbox, but you can sneak a peek, get the name off of any old mail. This in itself will aid you in locating the owner.
Now that you have armed yourself with as much ammunition as you could find at the property, you will want to set out to investigate further. Depending on the size of your city, you will want to go to the city hall or county building and simply ask to whom you should speak in order to locate the owner of a certain property.
They will direct you to the office or offices that will give you the best information. I personally have found that the tax recorders office has the best records because they collect the taxes every year.
In my town, they tell me if the property was classified as a single-family or multi-family home and the name and address of the last known owner. Between what I find out at the property itself from the neighbors and my sneaking around and the city and county buildings, I set out to contact owners.
Try to talk to a former tenant first
Before I actually attempt to get to the owners of the property on the phone, I try and talk with the person who actually lived in the property last. Many times this was a tenant. Why would I want to talk with a tenant?
Simple: You want to find out the truth about what is wrong with the place! Again, you want to try and get the previous tenants on the phone if possible.
If you have the name and address, you can do a quick search using an Online phone directory www.anywho.com. You simply input the information and hopefully you will come up with a contact number.
A quick call to the tenant explaining that you are doing research on the property located at "xyz address," and that you need information on the property "before our offices contact the owner" and you will get every bit of dirt the home has to offer!
You will know which lights are burnt out and which hinges squeak on which doors. Of course, we want all this information to gain the control we need when speaking to an owner.
The final step is to contact the owner directly. You want to have extreme confidence when speaking with them. The way to gain this confidence is to remember that you hold all the cards:
Get the owners on the phone if you can and tell them that you are an investor who purchases and renovates homes in that community.
Tell them that you are working with neighbors (You are because you spoke with them, remember?) in an effort to revitalize their neighborhood, and that you may be interested in buying the property IF the repairs are not too extensive.
At first the owners may try to play hardball and state that the home is great, and they were planning on fixing it up, but they will consider any offers. Be friendly and upbeat and explain that that would be great.
Tell them that you had already figured that they would be looking to fix it up, and that you have a list of needed repairs from an exterior inspection and speaking with the former tenant (give them the tenant's name).
At this point, they will know that you have them, and their attitudes will change. Make your low ball offer and see if they bite. Sometimes you get lucky and they say that they want to get rid of it and basically ask YOU what you want to pay. Again,low ball is the key phrase. The bottom line is to acquire the property for as little money as possible.
What if I cannot find a former tenant or the owner?
Well, if I cannot find a former tenant, I visually inspect the neighborhood and the exterior of the home. I still contact the owners with an air of confidence, as I know that they still have a vacant property that is costing them money.
If I cannot locate the owner? That's a simple one. I place a big, bold hand-printed FOR SALE BY OWNER sign in the yard with my number on it. More often than not, the owner, a relative of the owner, or a friend of the owner will call me. Most of the time, it is the owners themselves.
If they do, I apologize for the sign stating that an assistant must have gotten their house confused for another empty home in the neighborhood, "but since I have you on the phone, what are you going to do with the house?" The air of confidence comes rushing back!
You can find many online businesses and real estate brokers that feature a condo for sale. Lots of people are becoming addicted to condominiums as advanced age specifies style and demand far more innovative as well as a hassle-free standard of living. In addition to that, condo properties furthermore establish extravagance and elegance well over typical folks. However, just like different real-estate premises, condominiums can provide shortcomings coupled with its rewards. Consumers trying to find a condo for sale ought to be familiar with every one of these existing and specified circumstances in residing in a condominium to acquire the most effective and desirable real estate. All prospective buyers need to have the identical ambitions in buying a house which should be to enjoy the most secure household. With that, customers must look into all feasible scenarios which may be observed in the majority of condo properties to guide them to pick the correct one.
Most look for a condo for sale because of the comfort it brings from the provided services and amenities. Living in a condominium is like living in a hotel in a long-term contract. Like hotels, most condominiums have doormen, private parking spaces, pools, fitness centers and others. All of these are included in your payment for the condo no matter what financing plan you chosen. It may be hard to compare prices of condominiums for sale since most vary in many ways. Services offered are all different as well as facilities in the property. The options in various condominiums are numerous and choosing the right one that addresses your need is vital since it will all end up in the bill after all. Some condominiums use green technology and other energy saving technologies which can reduce costs for the tenants and other options. All of these things should be considered in searching for a condo for sale.
Privacy and Environment:
Another factor to consider in looking for a condo for sale is the privacy and present environment of the location and the condominium. Most condominiums are located in highly urbanized areas wherein city traffic noise can reach the comforts of your home. Activities by your neighbor can also cause discomfort if the condominium does not have good noise insulation. These are essential factors specially for people with high sensitivity to noise. Privacy is also another factor to consider, evaluate the volume of neighbors in a condominium unit, if that is fine with you and wouldn't cause too much discomfort. Having a good neighbor is one thing, too much is another.
Evaluating the condominium's structure can also be vital. Make sure that walls, floors, and ceilings have good sound insulation aside from being structurally sound. Essential facilities should also be evaluated such as fire exits and elevators which should be accessible to all tenants.
Another important factor to look into in a condo for sale is the present neighbors near and inside the condominium unit. When living near these people thus may encounter them and their activities as time goes by. Knowing the characteristics of these people whether they are students, professionals, or bums is vital. Your neighbor's daily activities can affect the way you live and have comfort in your condo unit. So make sure that you evaluate the people you will be near at.
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