Why Real Estate Forclosures Will Continue to Increase

170 Off ThirdTake a look at your local newspaper and thumb through it until you find the real estate section. Now more likely than not, you’ll see advertisements from new builders who are offering amazing interest rates or temporary buydowns if you purchase a new condo or townhome from them.

There’s a relatively new condo development (one of many) in San Francisco called 170 Off Third. I went down to check them out because they’re in a great South Beach location literally across the street from the San Francisco Giants baseball stadium. The units are on the smaller size but I really liked the modern art deco look and feel of the building and common areas. It would definitely be a nice place to live but I’m cringing for those who fall victim to their “last chance” offer. Here’s a portion of the e-mail I recently got from them: Continue reading Why Real Estate Forclosures Will Continue to Increase

The Next Real Estate Boom – Foreclosures

Real Estate BoomAs the real estate market continues to slow down foreclosures are already reaching an all-time high. This is only going to get worse in the next couple of years and it’s all because of the real estate boom in the previous three to five years.

Why is this happening?
It’s because home buyers were spending more money on new properties than they can afford and because loan brokers and mortgage companies were allowing them to overextend themselves. These brokers (in my opinion) were taking advantage of home buyers by giving them great deals on 3-5 year ARM loans or interest-only loans which allowed them to buy bigger houses they couldn’t really afford. Brokers of course get paid commissions from lenders they match you up with but that’s a different story. Continue reading The Next Real Estate Boom – Foreclosures

The #1 Factor Great Real Estate Deals Are Built On – Motivation

Money Bag HouseBeing a real estate investor, I’m always on the lookout for a good deal. That’s probably no surprise but if you ask 99% of all real estate investors I bet you the #1 important factor in real estate to them is location location location. Although this may be true for finding a property you want to live in, it’s not always true in finding a seller who has strong motivation to sell. This is really the first key ingredient in finding a good deal to invest in. Continue reading The #1 Factor Great Real Estate Deals Are Built On – Motivation

5 Things You Should Know Before You Flip A Property

1. Money is made at the buy, not the sell of your flip. When flipping a house your money is made at the purchase not at the sell of the house. So, many times people buy a house with the intensions of making a huge profit only to find out that they could not make any money after all the renovations because the purchased price of the house was to high. When you purchase your property you need to be sure that you buy the house with enough money to make renovations, have carrying cost, and add about 5% for extra expenses, and see what type of profit margin you will be left with.

Example: If you buy a house for $120,000 and the houses in the area sell for $155,000, and the house needs $15,000 to fix it up. You are now at $135,000. Carrying cost for six months on the home is $6,000. Now, at $141,000, and the fees and closing cost my extra 5% $6,000. Now, cost is at $147,000, and that is if everything goes as planned. Profit is under 10,000 dollars. The mistake was made at the purchase at the home, not the sell. Continue reading 5 Things You Should Know Before You Flip A Property

Property Sales Weak in August – San Jose, CA

Not Sold HouseI used to own a house in Santa Teresa which is a neighborhood in San Jose, CA. Ever since I sold my house in 2005 I’ve been watching the market to see if I made the right choice. When I did sell it, I received twelve offers all of which were over asking price. Now looking at some of the current economic real estate data, I’m very glad I sold when I did.

Sales of single-family, re-sale homes fell 10% from July and were off 39% year-over-year. Year-to-date, home sales are off 23.6% in San Jose,CA and are at their lowest level for the past ten years. The median price for homes fell 0.5% from the month before, but is up 6.1% compared to last August. The average price fell 3.2%, up 2.8% year-over-year. Continue reading Property Sales Weak in August – San Jose, CA

Finding Your Investment Property Part #2

Investment PropertyI previously wrote about finding your investment property and this is part two of this series. Part one talked more specifically about my trip up to bend Oregon and how I was looking for vacation rental properties.

To me, vacation rental properties can be a lot more profitable and enjoyable because you also get to enjoy using the property as well as renting it out. There are downsides of course to buying a property you plan on renting out such as faster wear and tear, people not treating the property very well, having things broken or repaired. Having said that the good news is these people renting out your property are paying down your mortgage and usually at a nice nightly premium price. Continue reading Finding Your Investment Property Part #2

Finding Your Investment Property

bend oregonRight now I’m up in Bend Oregon looking at potential real estate investment properties. I drove up here from San Francisco last Friday and will be here until the 28th. Oregon has really boomed (especially Bend) over the past several years and it shows. I remember coming up here years ago and seeing single family homes going for $250k. Now the same style is going for $450k. Continue reading Finding Your Investment Property

Stocks vs. Real Estate Investing

For the past many years, real estate has provided a hefty return for those who got involved early enough. Real estate has appreciated 12.4% annually between 2001 and 2006, according to the S&P/Case-Shiller U.S. Home Price index. That beats out stock prices, which gained only 4.3% a year as measured by the S&P 500. Continue reading Stocks vs. Real Estate Investing

Are You Stuck on the Fence? How to Get Started in Real Estate Investing

I received an inspiring email this week from somebody we’ll just call Jack. Jack is a senior in college and already reading up on real estate investing (very nice) and has the passion and motivation to take the next step. He’s asked me for help and doesn’t quite know where to start so I’m going to answer his questions within this blog post.

His email goes as follows: Continue reading Are You Stuck on the Fence? How to Get Started in Real Estate Investing

Quick Tip – Sellers Are Buyers in Disguise

disguiseIf you come across an “investment” property for sale ad on the internet or in the newspaper, there’s a good chance this person is interested in buying property too. Usually they’re running the ad because they need to free up some equity to finance another deal.

Take this opportunity to contact the person listed in the ad and explain to them you’re also a real estate investor. They might have some deals they don’t want or not enough cash to purchase which is great for you. On the flip-side, you could provide them with some “bird-dog” information as well. Continue reading Quick Tip – Sellers Are Buyers in Disguise