When you go out to buy a house, you’re going to want to buy the best house possible for the least amount that you need to spend. It’s a good idea to be cautious because you know that you’re going to be making one of the biggest purchase of your entire life when you sign the dotted line. So, when's the best time to buy a house?
Even if it looks like you’re getting a great price for your home, there are other ways that you can still try to find other advantages. Knowing when the best time to buy a house is one of the many advantages to get the best deal for the home you’ve always wanted.
Factors That Make an Impact on the Best Time to Buy a House
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There are two main factors that you think about when you’re deciding on the best time to buy. More specifically, you should look at the surrounding market as well as your personal circumstances. You need to go into this decision-making process realizing that there are some in each case that you will have no control over.
What Are Market Factors?
Market factors include interest rates, knowing the difference between a buyer’s or seller’s market, and what you’re looking to do. Lower interest rates are better when you’re trying to pay off your mortgage in a reasonable amount of time.
When you’ve decided you want to buy a house, then you’re going to pay attention to what’s happening in the market regarding selling and buying. A buyer’s market is when the conditions are ideal for home buyers. You’ll find plenty of homes for sale and sellers typically drop prices to get their homes sold.
Seller’s markets are different in that sellers control the strings so to speak. That means that the demand for homes outranks the supply of available inventory and sellers know they can ask more for the home they are selling. In this situation, a seller can demand a high price and often get what they want.
What Are Personal Factors?
Many personal factors can influence whether or not it’s the right time to purchase a home. You need to think about your financial situation as well as your lifestyle expectations. You might not realize that maybe it’s not the best time to buy a house until you take some time and think about these things.
When you think about your financial situation, you need to consider your income and whether or not you make enough to qualify for a house payment. Your credit score will also impact whether or not you’re going to be approved for a mortgage loan. Do you have a down payment? Will you be able to afford typical home maintenance expenses along with the times when the big things die like your air conditioner or other major appliances?
Then there is your lifestyle to think about. Do you have the availability to maintain your home? That means taking the time to mow the lawn, paint the sides, and generally take care of your home inside and out. What about plans to move in the foreseeable future? Do you see yourself settling down or will you be moving somewhere else?
Understanding Seasonal Supply and Demand
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Finding the best time to buy a house isn’t exactly cut and dry. There are other factors to consider when you’re trying to figure out whether or not you’re going to move forward. Supply of homes versus demand for homes in your area of choice make a significant impact on the price you can expect to pay, but did you know that each up and down is seasonal? It’s true!
Spring and Summer
Warmer weather and longer daylight lead to more people putting their homes up for sale in the spring and summer. The supply increases, but it does not cause the price to go down. This time of year is actually more competitive, and sellers will demand higher prices.
It makes sense, though, when you think about people and their personal situations. It’s easier to move during this time of the year when you do not have to deal with potential snowfall or cold weather. Moving during the summer is also easier for families with school-age children because it offers a time of year where a clean break can be made before starting over the following school year.
Fall and Winter
When you think about cooler days, moving doesn’t seem quite so appealing. Fewer homes are available, and buyers seem to fizzle out. That doesn’t mean the buyers aren’t out there, but it does mean that homes are more likely to sit longer. As a result, prices may be more negotiable with sellers.
In the fall, families are busier with school schedules, holiday planning, all combined with weather that can be a pain to deal with. No one wants to be planning a cross-country move when little Johnny still has his Christmas concert or when little Susie is working to perform in a dance recital.
Knowing When to Start Looking at Houses
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Each month brings different challenges, so you need to know what you’re willing to do and what you’re dead set against doing at all. You want to choose buying times that are off-season, so months like January or towards the end of August present excellent opportunities to purchase a home and save money doing it.
Backtrack from your targeted home purchase time to determine a timeline that is going to work for you. Remember, your home-buying experience is going to be different from others because there may be multiple factors that are important to you compared to anyone else.
What Kind of Buyer Are You?
If you are a first-time buyer or someone that is on a strict budget, then you want to aim for a January closing, or maybe even over the Christmas holidays. To meet your deadline, you want to look sometime in the fall and give yourself a good couple of months to explore without feeling pressured.
Experienced buyers or those with a budget range may have a better experience in the summertime because there are more homes to choose from. You may be the type that is looking to move to a different neighborhood or for an upgrade from your existing house.
Another common scenario is needing to sell a home before being able to purchase a different home. If that’s the case, you’ll want to list your house towards the end of April or beginning of May. The reason for doing so is the busy time that happens at the start of June, so chances are that your home will sell faster.
You’ll need to be ready to partake in the busy time, too, to buy your home, but it may be the perfect storm that you need. Not only will you get your house sold quickly, but you’ll also be in a better place to find the home you really want to call your own.
Taking the Plunge and Buying a Home
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There’s no way around it – buying a house is a massive decision to make. It will impact your family, your future, and your very existence as you know it. A purchase like this quite literally can change your life.
When you decide to take the plunge, you need to know that you can’t control every facet of the market around you. At the same time, that doesn’t mean you can’t find the best time to buy a house if you do some legwork along the way. You’ll be better equipped to make the right choice, and as a result, you’ll be less likely to experience buyer’s remorse or wonder if there was something better out there after the fact.
Do some research for the seasonal ups and downs for the area that you’re looking for. Consider contacting a real estate agent that is local to your final destination and asking questions. If you are willing to work the market and understand when the time is right for you, it becomes possible to save thousands of dollars on the home you want. Your bank account will thank you.
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condominium townhouse project a few miles south from where I lived. The bank that now owned the units was willing to offer the financing on the project. All that was required was the down payment of thirty percent, and a small amount of finish work was necessary to complete the townhome construction at that point in time.
need for diversification in my portfolio as a strong way to remain even keel financially. And it has kept me in good stead ever since. I thought, “let someone with deeper pockets than myself inherit the risks of this project…” And so I did. And never thought twice about my decision.
invest in Real Estate Investment Trusts (REITs), where professionals manage a pool of funds, but allocate the funds strictly to real estate. This will absolutely help in your diversification.
estate, it’s always a good idea to consider some form of property diversification. Like any asset class, diversifying can be a great way to help weather any downturns in a given sector of the market. With so many large fund investors (who acquired foreclosures by the thousands in the past few years) having sold off a large portion of them on the market while prices have risen in the past several years, looking at the commercial sector to invest in now makes good sense, since prices have started to stabilize in the residential arena due to the sell-off.
your global real estate investment through the pros – namely, global real estate companies, such as Apollo Global real estate, for example.
in specialized types of REITs, known as global real estate ETFs, or exchange traded funds. These differ from REITs that are strictly domestic in nature.
investments tend to be allocated amongst both residential as well as commercial properties. In addition, many larger REITs will invest in foreign properties as well. As mentioned above, some REITs only invest in foreign buildings. And a newer trend is for larger publicly-traded REITs to invest some amount as a stake in the creation of other, foreign-based REITs, many of which are privately held.
can be a very lucrative way of going. Be sure to do your homework, and then choose the correct REIT that meshes well for you. You’ll find expanding your real estate portfolio to include some form of overseas investment property is the smart way to go for long term growth. And as I mentioned above, heed my example of weighing placing all your eggs in one basket. Diversification is critical when trying to stay afloat for the long run in real estate investing.
investment?” I’d like to submit this little tale of woe about the “professional” property investor who thinks he knows what he’s doing. I recently showed a house an investor had renovated to a young couple I represent as a buyer’s agent. The house was a simple 1915 Cape Cod style home. For the most part, the investor had done a fairly decent rehab job on the property. He claimed to have done all the work himself. This is a rarity. In my experience, most people who invest in homes traditionally create their own crew to work with from project to project. Not this guy.
deadly sin of overpricing from the get-go. So it just sat there. No offers. No nothing. He kept reducing the price several times. Ultimately, after six months, in the dead of Winter, he took it off the market. And in the Spring, he placed it on the market by himself, with a much lower, more realistic asking price. Problem was, he was still over-priced for the market and the work he had done. But I could tell he had boxed himself into a corner. He was trying to price the property based on what his costs were. Not what the market would bear. So, basically, he was sunk.
final Certificate of Occupancy he received for successful completion of the project. Check…and check. At least the town felt it safe. So why didn’t I? Most times, I can forgive stupid-looking remodeling work. This guy had redone everything. But his upstairs full bathroom offered the tiniest of a vanity, while utilizing a five foot wide shelf for….I have no idea. It was free form…unconnected to anything. Stupid. But you know, investors can be stupid and still make money on their flip projects in spite of themselves – and their lack of understanding of what buyers really want.
water heater and well tank and pump. All were on raised blocks. The concrete flooring was all newly done. Looked great. New solid support beams on the new concrete. Fantastic. And a huge pond of water on one side of the basement leading to nowhere. Oh – and a lovely sump pit with new sump pump doing nothing, sitting on the other side of the basement floor… “Oh, that – probably coming from the well outside,” he volunteered. WTF????
address? He claimed to have been doing this sort of rehab work for many years on many different projects. I don’t see how. For a few thousand dollars more, he could have installed a French drain in the basement, solving his water problems. (A French drain is a basic interior drainage system.) Now, any buyer’s home inspector is going to send out red alerts about what major water issue could be confounding the property surrounding the house. Could be a high water table. Could be a well leak. Could be any number of things. A French drain would by an easy solution. Instead, he does all this work, and has trouble selling his investment property, due simply to his stupidity.
(and clearly, not all renovation work). But he knows nothing about marketing a house. Indeed, he also knows nothing about identifying what buyers in his area are truly looking for. If he did, he’d know what to give them. In addition, he’d know his target market, their price range, and the price his renovated house would need to sell for – before he ever acquires the house to flip! In so doing, he can best plan his renovation work, materials needed, and work to be done, so that he can price based on the marketplace – and not on what his overall costs end up being. Certainly in his case, and sadly at that, he will most definitely be taking a substantial loss on all his efforts.
As in this example above, older, period houses usually come equipped with renovation costs that can skyrocket out of control very easily. Costs that the average property does not share, and that you may not properly account for when you crunch your numbers, and come up with your overall rehab budget. It would be sad indeed to purchase an older house at a great price, only to discover you’re sinking in red ink as your fix-up costs spiral out of control, and way beyond what you originally planned on.
today’s standards, and also are quite leaky – producing many drafts, thereby increasing your heating costs. Also think about the costs of rewiring hundred-year-old electrical wires and circuits throughout the house. And how about replacing antiquated plumbing lines and fixtures as well. On the whole, your repair costs could run 25% to 50% higher on an older property than on a newer one.” I have gone on to recommend that the best investment property search results can usually be found through investing in newer houses that need less repair work to begin with, and which will cost less to maintain in the long run.
There are many ways to finance investment properties. If you’re not paying all-cash for a property, and you want to utilize leverage to greatly increase your prospective ROI (return on investment), you’ll find many options available to you. Which one you choose is a matter of personal taste. And deciding among different investment property loans available, that will suit your temperament and pocketbook, will be critical to your bottom line.
investment property loans from banks traditionally require at least thirty percent down by the buyer. So I was able to leverage an additional ten percent by going with the seller financing. This was a great way to get a business loan for rental property.
benefits of an unbelievably low monthly payment, and resultant high cash flow – and even greater net income. This four family house quickly became a huge cash cow for me. And I had plenty of time in which to refinance to a traditional loan. So while I ended up paying about ten percent higher in market value than the property was worth, the difference was more than made up for (while I held the property) in net cash flow income and capital appreciation when it came time to sell. So my advice: if you can find seller financing, take it. And don’t be afraid to give the seller “their” price” in return for “your” financing terms. It could end up being a major financial windfall for you in the end.
are usually at least double conventional mortgage loan rates. And their points charged (pre-paid interest) can be triple or quadruple conventional points charged.
due within 1 to 3 years. In all but rare instances, hard money lenders require being in the first mortgage position, so they can get their money out first if you default.
a minimum of 30% down in most instances. In that case, you’d be obtaining a loan of 70% of the purchase price. Your loan-to-value ratio (LTV) would therefore be 70%. When buying investment property, you’ll usually want to try to obtain the greatest return on investment (ROI). Leverage (also known as cranking) is one of the ways you can purchase multiple properties over time, and thereby maximize your ROI. Depending upon your credit rating, as well as the type of property you’re purchasing, the down payment required may be higher, and could go up to 50% – and therefore your LTV would be a low 50% as well. In addition, the points charged on the loan (pre-paid interest) are roughly twice as high as for a conventional home loan.”
homes or apartment buildings with at least five units in them, the you’ll definitely need a commercial loan from a lender. Lenders have separate divisions to evaluate and extend credit on these type properties. Since commercial properties are much more specialized, their inherent risk need to be evaluated as a niche within most banks. Unlike conventional residential mortgages, you can expect that underwriting requirements will be much more stringent by comparison. For example, a commercial lender will be poring over your financial statements with a fine toothcomb, and you can certainly count on much more scrutiny of your assets and income, as well as the existing income statement of the property you’re considering purchasing. Also expect rates and points to be higher than standard residential loans.
way of financing. Interest rates are usually as low as you can obtain from any lender. Second, the interest is tax-deductible as a business expense. And third, you can choose to make interest-only payments monthly on the outstanding balance, usually for a period of ten years, knowing that you’ll have a balloon payment looming down the road. Most times, the balloon will be incorporated into a second ten year payback period, where you’ll be making monthly principal and interest payments. In this way you can utilize the equity in your home to create a credit line for further property investments. You’ll find this a great way to finance further investment property acquisitions. Also, you can structure the loan as a revolving credit line. So when you sell a property, you can pay off the credit line. Then you can take it out again when you’re ready to purchase the next house.
the U.S., you’d think a large segment of the population will be ready to bolt depending on the outcome of the general election in November. How many celebrities and political pundits to date have made half-assed threats to leave the country should Donald Trump be elected president? There is no denying the more-than-implied threat to both national, and therefore, world economic stability should Trump succeed in his endeavor to gain the presidency, and then as he attempts to make good on many ludicrous economic “suggestions” he seems to come up with on a daily basis…
countries can show yields in the double digits year to year. Your selection process will be critical, based on the degree of risk you’re willing to assume. I always recommend getting advice from other property investors who are experienced, and know how to buy real estate overseas. There are online property investing clubs for real estate investors who just invest in overseas property. Seek them out as part of your initial research into different countries. In addition, know that overseas real estate investment is going to be for the adventurous at heart…the risk-takers who have the guts and stamina for dealing with investment property that is not close to home. From time to time you’ll be able to travel to them, but for the most part, you’ll probably have a property manager handling the day-to-day duties of running the properties overseas.
well as the amount you’ll accept when it comes time to sell your property. In addition, your diversification will also include having holdings in different currencies. In this way you can take advantage when certain countries currencies appreciate in value. Remember too, your property investment overseas has the ability to make use of multiple land uses, depending on what is “hot” at the time in that particular country. You shouldn’t think that purchasing real estate overseas can be simply for renting to people. Some countries rely on a burgeoning forestry or agricultural usage of the land.
investment for another key factor – and one that, given the explosion of refugees from Syria over the last year – remains such a huge factor. I refer, of course, to immigration. This factor is one of the key stabilizing factors in buying real estate overseas! One might think the opposite, given the negative press Syrian refugees have received. However, Europe’s largesse should be a beacon to overseas property investors. The high immigration patterns throughout Europe tend to create a very robust rental market for each developed country in the European Union.
as confidence in the marketplace stays high. Basically, you’re taking lemons and making lemonade out of them. I have also noted before that, as long as you are utilizing the services of a local property management company, the risks of such long-distance investing can be reduced substantially. This is especially true in countries where market rental rates are increasing and demand remains stable.
But, that’s OK. I eventually learned to become honest with myself. And then I went out and hired a nice property manager to handle all my rental units….dealing with the tenant complaints, collecting rents, selecting tenants when old ones left, keeping my vacancy rate down, maintaining my properties, and inspecting them on a regular basis. Oh – and supplying me with monthly accounting statements as well. Let’s face it – if you don’t have the right temperament for the job, fire yourself! And hire a property management company. While you’ll be paying a management company fifteen percent of your gross rent roll, it may well be worth it in your time – and more importantly – your sanity – saved.
include being entrepreneurial, being decisive, and having a proper aptitude (though not genius-level) with math, as well as being meticulous, grounded, and having stick-to-itiveness. These are some of the basic qualities a good property investor will display. Notice I did not include: being good with people, or being a “wheeler-dealer” type. These two traits are not something you need…and they can be learned, as well as delegated to others. That’s what property managers , as well as real estate agents come in and can do for you.
business to take on the added risks. Rather, hands-on property investors enjoy wearing many different hats: being the site locator, searching for properties, then being good numbers crunchers to see which are the most attractive properties available at any given time.
understand that this is no simple task. Here are the most basic responsibilities of property managers: Maintaining your rental property – As your own manager, you’ll be responsible for regular on-site checks on your building(s) to ensure proper safety and regular upkeep/maintenance. Also, you’ll be responsible for all emergencies (ie. – emergency calls from tenants), and making sure the right tradesperson is called to fix the problem, as well as follow-up to ensure the problem was fixed properly, quickly, and resolved to the satisfaction of your tenant – all at the most affordable cost to you. Ask yourself if you’re okay with these emergency calls from tenants – whether in the daytime, or in the middle of the night and on weekends. If you’re a calm person who’s good at “putting out fires” without it taking an emotional toll on you, then by all means you’ll be a good property manager for your own real estate holdings. If not, look towards hiring a professional property management company.
handyman you’re comfortable with can suffice, as he can perform many of these tasks as a general all-in-one repair/maintenance service person who‘s “on call” for you. In addition, you’ll need to advertise, locate, screen and approve all tenants. Show your rental units that are vacant. Prepare all leases, and have them signed. Collect rent from all tenants. Make all collection calls on delinquent tenants. Represent yourself in any tenant eviction process, if necessary. Work with your attorney to aid in a smooth eviction. And keep all accounting for each property – you’ll need to deliver to your accountant each tax season a proper set of books ( or files) for each building you own.
cash flow problems paying your expenses. As part of your job as your own property manager, you’ll also want to stay in regular (at least once a month) contact with your tenants. Many times, tenants will not tell you about “small” problems they’ve been having with your property – until it’s a big problem. By being pro-active, you can scope out these problems when they are indeed small. So, for example, you can ask each tenant each month if there are any issues you should be aware of – for example, any small leaks going on in the unit, any bug problems they’re seeing, any safety-related issues (say, a constant flickering light that would indicate a potential electrical wiring fire hazard). By asking you’ll stay way ahead of the curve – and be able to jump on any potentially big problems when they’re still small – and easily (and cheaply) corrected!
best for you to better understand the rigors that come with managing your own properties. And in the process, you will develop a finer appreciation for the sheer amount of work and expertise required of the job. Even with property management software readily available online, it’s still going to be a learning experience for you. And this experience will only help serve you in good stead as you move forward, and purchase your next investment property. You’ll know from limited experience how demanding property management can be – and time consuming as well. You may find that it will be much smarter for you to hire a property manager as you grow your investment property empire. By doing so, the extra cost for their services should be outweighed by your time costs, as a property management company will aid in providing you more time to search for new property acquisitions.
after my generation’s death-defying leap into the unknown world of cancer-causing agents, the federal government, in the guise of the creation of the Environmental Protection Agency (EPA), started listing asbestos as a known carcinogen. Oops.
Environmental Protection Agency (EPA) began regulating materials containing asbestos. The fire retardant material can most commonly be found in buildings, but also in gas heaters, hair dryers, some clothing and automotive brakes. Walls, flooring, pipes, textured paints, insulation, fireproofing materials, pipes, electric wiring, and even chalkboards constructed between 1920 and 1989 may contain asbestos. If the building was constructed between 1920 and 1989, chances are something in the building was constructed with materials containing the material.
a serious health risk when its fibers become loose and airborne, since breathing them in can cause scarring of the tissue lining the lungs (causing mesothelioma) and even lung cancer. You can check for signs of asbestos on your own, but testing should be done by a certified professional using special equipment. If asbestos is present, hire a contractor to repair or remove the materials that contain it to ensure the safety of yourself and people using your property. Trying to do asbestos removal on your own is not only illegal, it’s really, really stupid.
of the esophagus are thought to increase with increased exposure to asbestos. So, rather obviously, you’d want to avoid it like the plague.
degrading. Asbestos isn’t dangerous when it’s still in good condition, but when it starts to break down and the fibers are released in the air, it becomes toxic. Look for signs of older materials that have become worn out or damaged.
– and an immediate danger to anyone breathing in that basement. If you’re still not sure whether the investment property you’re scouting out has asbestos-lined pipes, a home inspector can determine it for you. Also, licensed asbestos handling companies can not only tell you if there is any asbestos in the house, but what condition it’s in as well. And they are the only ones that can legally remove and dispose of the asbestos.
(encapsulation) of the asbestos. However, if the property is a foreclosure, or a short sale, the owner may not be able to perform the remediation, and you’ll have to include the removal as another cost of purchasing the property. It’s always best to have the asbestos removed, rather than encapsulated. While encapsulation is certainly less expensive than removal, you could have an issue when it comes time to sell the property. After all, what happens if a water pipe that was encapsulated develops a leak? In that eventuality, the asbestos will have to be removed in order to get at the pipe. And most buyers will not want to deal with that possibility. So removal makes far more sense than encapsulation.”
further evaluation by licensed accessor (sic) for best corrective measures.”
Mold typically grows anywhere it’s damp and there’s a food source. In buildings this food source is often the very materials used to construct and furnish a home. Mold can be difficult to remove because even when it’s dried out, mold can easily become aerosolized and spread in the air throughout a building.
called MMR. MMR is a commercial grade mold and mildew stain remover formulated to immediately remove mold and mildew stains present on wood and other hard surfaces. With fast and easy application that eliminates mold stains on contact, MMR penetrates soiled areas almost instantly, leaving surfaces clean and free from mold stains. This is a sure-fire way on how to kill mold.
inspector has to find something that appears to look like mold, but which he can’t actually call mold. Then the prospective buyer has to decide whether to accept the house as is, or spend the hefty sum (which could be as much as double the amount of the home inspector’s fee) for the assessor to do their mold assessment. Once mold is actually found, then the buyer can ask the seller to have the mold remediated. But the seller will then have to pay the assessor for that assessor’s plan first, which is the blueprint for the remediation company to follow. The whole process is jacking up the cost of mold remediation exponentially.
new law, there is an exemption, or out, for homeowners to do mold removal themselves. Yes, you heard me correctly. Legislators felt it was safe enough for homeowners to effectuate their own mold removal themselves for their own property, but only if under ten square feet of mold was involved. I suppose breathing the crap in from 10 square feet of the stuff won’t hurt anybody. Hell, you could use MMR yourself, or even bleach for that matter. As long as it’s under 10 square feet, see if the government cares for your health…
standards for mold, so any interpretation of sampling results would not be based on any established health or environmental standard. If the total mold affected area is less than that 10 square feet (approximately 3′ by 3′ square) and the homeowner does not have any sensitivity towards mold, mold removal may be done by the homeowner. It also states that a biocide is not recommended as a routine cleanup for mold as it may cause sensitivity in some people. It goes on to recommend that one ventilate the room if a biocide is used to get rid of black mold. Also, one should “observe and follow the manufacturer’s labeling instructions.” Ya think?
truly is no such thing as privacy in our world anymore due to the internet, it is now ridiculously easy to gather intel, er….I mean…background information, on anyone. This makes screening tenants a cinch. In fact, any property investor who decides to manage their own properties can simply and inexpensively utilize the services of independent, online tenant screening companies who will do the leg work for you. Not that this leg work is all that difficult to begin with…but if you like to delegate this kind of simple, but time-consuming work, then by all means use these services.
meticulously interview current and former landlords and employers of any prospective tenant. Rather obviously, this would be a time consuming process. But today, you have many options available for screening good tenants, and weeding out the bad ones from the quality ones. I have even written in a much older prior article here (from several years ago – ie., the days of yore) about doing one’s own reference checks. I went on to elaborate on what a time consuming process it could be.
they will be keeping their job long into their tenancy with you? And, of course, do they earn enough income to support your rent? These are the kinds of simple, basic questions you need to get answered when running reference checks on potential tenants.”
obtained, with the permission of the tenant. Some landlords allow the tenant to supply their own credit report…while other landlords prefer to do it themselves – but have the potential tenant pay the fee for pulling a report. In addition, many landlords include charging a separate fee for pulling a background check as well. This background check will research and reveal any potential tenant’s past criminal history, if any exists.
false information (disinformation) can be widely disseminated very easily nowadays.
Experian that provides credit reporting. Likewise, another tremendously large and reputable credit reporting company, Transunion, offers one of the top tenant screening services as well. You really can’t miss if you utilize either Experian’s or Transunion’s tenant screening services. They are top-flight. If you check online, you can also find more localized companies, if it’s important to get your data closer to home. In addition, check these local companies out by looking at their tenant screening services reviews as well. Their online reviews will provide a wealth of information that will help you in your selection process.
Once chosen, some property investors prefer to pay the tenant screening service directly, while others may have the prospective tenant pay for the service. Either way, the landlord obtains the most up-to-date data available about any possible tenant. The winning combination of a great credit report and commensurately high credit rating and no criminal background will virtually ensure a good tenant. It is for these reasons that finding and securing quality tenants today has become such a science.
to ingratiate yourself with them (thus helping to explode the stereotypical landlord image). On their first day, meet with them to go over the operation of appliances in the unit, as well as to discuss area amenities they should check out. It’s also a good idea to offer them a small housewarming gift too. Remember, this is a business. And it’s always easiest and least expensive for any business to retain clients than it is to search for new ones.
investors are naturally going to be leery that they will make a huge mistake, and end up buying a money pit of a house. It is good to be wary. Especially without the experience that comes with acquiring more and more investment homes. Whether they be for flipping, or to hold onto and rent out long term, there are some basic mistakes to look out for as you assemble your home buying checklist. And don’t think that a money pit is confined to low end homes either. Even huge mansions can end up being potential money pits. If you’re not convinced, check out this article: 
need to be brought into this decade, or an entire whole-house gutting down to the wall studs with complete rehabbing of new electrical and plumbing as starters, fixer upper homes for sale can represent a tremendous opportunity for any investor. You can pick up some cheap fixer uppers that, once you’ve completed renovation, can earn you a tidy profit. Fixer upper houses come in all shapes and sizes, but they all have the same major component: they are waiting for some entrepreneurial person to come along, see the vision in what they can be transformed into, and know where to invest rehab dollars wisely for maximum re-sale value when the house is ultimately flipped.
your vision of what a house can be transformed into – and sold for a profit – if you don’t properly crunch your numbers, and stick within your limits. I have seen too many property investors who make the mistake of “falling in love” with a potential flip, only to slowly keep edging their counter-offers up, beyond what they originally felt was their top limit for what they would pay for the property. This is a rookie mistake. Don’t be blind to the emotional pull of it – remember – it’s not your home we’re talking about…it’s a simple business decision. And if it’s not right financially, then you move on to the next best alternative property available to make an offer on.”
get emotionally involved in the decision-making process. Always crunch your numbers – then double check them until you feel totally sure of your financial constraints, as well as what you feel your profit will be on the investment. And always stick to your final number when making an offer – don’t deviate upwards, regardless of the temptation to finish the deal. Remember, there’s always the rule of “next” – and you should move on to the next available property to make an offer on, rather than go in over your head on a potentially bad deal.
are specifically looking to offset other income with losses for tax purposes, it’s best to stick to properties that represent strictly positive cash flows…and the greater the better. Novice investors should be wary of any property rehabilitation project that involves negative cash flows. Second homes and land speculation are prime examples, however even simple “fixer-uppers” can become disastrous for throwing off large sums of negative cash flow (also known as “negative gearing”). Unless you’ve had experience with land development, steer clear of this form of property investment.
work to be done prior to even making an offer on a rehab project. Without a doubt, investing in negative cash flow real estate should be attempted only by those with deep pockets, looking to shelter other forms of income from the tax man. The losses thrown off by negative cash flows will aid in reducing the bite of their overall tax bill. So, in effect, negative gearing makes sense for them…but not so for the novice investor actively looking for profits from the outset.
realistic market value for the property once it’s all fixed up to determine your net income projection.
through a home they’re considering buying. Are the basic, standard amenities there? Are there any safety code violations present that haven’t been corrected? You should always have a fresh set of eyes review your project after work is almost completed, just to be sure you haven’t missed anything critical to your ultimate buyer when it comes time to flip the property. In this way you can avoid making any costly house renovation mistakes.
