REAL ESTATE INVESTING: WHAT IS PREHABBING?
Prehabbing is a great way to get started in the world of Real Estate Investing and is something that every Real Estate Investor should know about. Through, MY SMART COUSIN, we help familiarize prospective investors and homebuyers, and particularly Black and Brown folks and women, with the benefits of investing in Real Estate and how can they also Buy a house for the price of a car. Perhaps even more importantly, as a Real Estate Investment coach, we guide you on how to take your finances to the next level and generate a continuous source of income. WHAT IS PREHABBING AND HOW DOES IT WORK IN THE REAL ESTATE MARKET? Prehabbing at its most basic level is preparing a house for the more extensive work required for a large renovation. Prehabbing a home usually involves doing minor renovations to a property and then selling it to an investor. A house that’s full of debris or has significant damage to only a small area of the home can narrow the pool of potential buyers. Prehabbing can make the property easier to sell by giving it more curb appeal and raising fewer red flags. The minor renovations pay for themselves and then some by increasing the perceived value of the property and its ability to become a successful flip. In turn, this increases profits through appreciation-oriented sales strategies like those used by buy and flip investors. WHAT ARE THE BENEFITS OF PREHABBING FOR INVESTORS AND HOMEOWNERS ALIKE? Prehabbing a property has several benefits: · It can shorten the timeline between purchase and sale and thus lead to a faster fix and flip. · The upfront capital required to prehab a property is significantly lower than performing full-scale renovations. Less upfront capital lowers the risk of recouping all of your investment on sale. · A higher profit on sale can be achieved, thus increasing the return on investment. HOW CAN YOU GET STARTED IN PREHABBING? Whether your home is your primary residence or it’s an investment property, readying it for sale rather than taking the what-you-see-is-what-you-get approach with buyers is key to adding value. Buyers, even buyers who are investors, need to be able to see the potential upside of a property. If all they see are problems, they might not be able to get past them and consider the house as a good investment. Addressing a large eye sore such as holes in a wall or in the floor can help put the house in its proper perspective. Paint, as an example, goes a long way in helping buyers see the positive aspects of a house. Whether your prehabbing work involves a complete paint job, new cabinets or landscaping, or bigger jobs such as addressing structural issues with a floor, this work can help homebuyers and investors see the remaining small handful of problems rather than a long and overwhelming list. Another benefit of prehabbing versus rehabbing is that prehabbing limits the amount of cash you tie up in a property and puts a cap on just how much you’ll spend before getting into full-on the gut-renovation territory. By doing a clean-out of the property and tidying up minor cosmetic issues, you provide a clean slate for someone who is planning more extensive renovations. Keep in mind that when prehabbing, you should always prepare the property for its next owner. While fixing small issues like plumbing or painting may seem insignificant at first glance, they are crucial parts of making sure everything will go smoothly in the marketing process. Let’s take a look at the basic improvements that should be done when prehabbing: · POLISHING AND CLEANING FLOORS You can clean the floors while prepping for buyers. Make sure to keep the home presentable by polishing wooden floors and vacuuming carpets. You want this space ready so that when an investor comes through, you’ll be their first choice. · PAINTING A fresh coat of paint should be an essential part of any home renovation. The appeal and beauty will surely impress buyers, while also making your property look better in photos and other marketing materials. · CLEANING Giving your home a good once-over will make it much easier to sell. Be sure to thoroughly clean it with the help of a cleaning service, and check for peeling paint or spots heavy with mildew. Take care of these small details before showing the property so buyers won’t attribute a large cost to fixing what are ultimately minor issues. · BRIGHTEN THE HOME You know what they say—let there be light! If the house is overly dark or gloomy, consider turning on the electricity and brightening it up with a few lamps. SUMMING IT UP Prehabbing is a great way to get started in the real estate market. It can help you learn more about the market and how different factors affect prices. For investors, rehabbing can be a great way to find undervalued properties, spend a small amount on improvements, and sell them to an investor or homebuyer. Contact us to learn more about how we can help you get started today. YOU CAN ALSO READ: 7 Tips to Build an Entrepreneurial Mindset FOLLOW US: @MYSMARTCOUSIN
BUYING REO PROPERTIES: TIPS, PROS & CONS
If you’re a Real Estate Investor or are just thinking about buying a home, you’ve probably heard about REO (real estate owned) properties. REOs are homes that have been taken back by the lender after being foreclosed on. They can be a great deal, and come with the opportunity to acquire properties with attractive profit margins. Another great way to acquire properties that offer an attractive return is to buy a house at the price of a car. Read on to learn more! BUYING A HOUSE FOR THE PRICE OF A CAR It hardly matters if you are new to Real Estate or a skilled expert, an able coach can help you find your way and achieve your goal more quickly. We at MY SMART COUSIN are there to guide you, with a special focus on serving Black and Brown folks and women, and help you move ahead in the right direction and scale your finances. As your trustworthy Real Investment Coach, we help people do what we do routinely and Buy a house for the price of a car through the hundreds of opportunities available daily. Are you in the market for a new home? Or maybe you’re an investor looking for your next big property project. In either case, buying a low-priced REO property can be a great option. Whether you’re just starting to think about it or you’re ready to take the plunge, read on for all the info you need! WHAT ARE REO PROPERTIES AND WHY ARE THEY A GOOD INVESTMENT OPPORTUNITY? A central plank in Real Estate Investing is finding properties with unrecognized or underpriced potential, and flipping them for large returns. What makes a Real Estate Owned property stand out is that the bank owns the house courtesy a foreclosure triggered by the homeowner not paying the mortgage loan on time or at all. Because banks are not in the business of owning houses as part of their core strategy, lenders tend to be willing to negotiate the sales price. These negotiations can result in lucrative investment opportunities–but only when they come up during your search process. Another benefit of REO properties is that the homes tend to be in somewhat reasonable condition rather than of the tumble-down variety ready for a wrecking ball. The reason is that the homeowner may still live in the house right up until the day that the house is sold. While deferred maintenance will likely need to be addressed, it’s unlikely that major structural issues will be the case in such a scenario. If the homeowner is no longer living in the home, the lender is taking on the responsibility of performing minimal maintenance through a third-party servicing company, again, minimizing the likelihood that the property requires a full gut rehabilitation. HOW DO YOU BUY REO PROPERTIES, AND WHAT SHOULD YOU LOOK FOR WHEN EVALUATING THEM? Purchasing REO properties is similar to other forms of house hunting, with a few exceptions: · FINDING PROPERTIES – Begin your search by identifying properties that are in your desired range and market. Meet with your local bank to determine if they maintain a list of REO properties for sale. · HUNT FOR LENDER AND FINANCING OPTIONS – In order to avoid finding a property, only to have your financing fall through, select a lender and obtain pre-qualification early. When the selling bank that has REO properties knows that you are financially eligible, they are likely to take more interest in your offer. · PREPARE A LIST OF SELECTION CRITERIA FOR REO PROPERTIES – It is important to determine what your key must-haves and dealbreakers are in a property before beginning your search. The more time you spend prepping your criteria, the easier it will be to make efficient, confident decisions when presented with multiple listings by different owners and brokers! Start by looking at the properties you own, or the type that catches your interest, to hone in on what your drivers are. Importantly, don’t allow price to be the only factor on your list. Consider other factors such as property location, size, current condition, ongoing maintenance needs, and so on. · GET AN APPRAISAL – Whether you’re purchasing a property for a primary residence or for an investment, appraisals help you determine the value of the property, warts and all, relative to its asking price. · MAKING THE OFFER – If you have a real estate agent, use your agent to make the offer and work with the lender. An agent offers you another set of eyes on things that you might miss, as well as helps to temper emotions. · HOME INSPECTION – Home inspections are important because they can help you avoid costly repairs after the purchase. A home inspection should always be done before finalizing any deal, but this holds especially true for real estate-owned assets as such properties often come without the protection of warranties or disclosures. · THE NEGOTIATION – Banks, like most sellers, will seek to maximize profits and close quickly. Banks, however, usually have multiple levels of approval involved in their chain of command. As such, be prepared for an extended process that is paperwork-heavy. If you are unclear about the purpose of any documents and what they mean, always ask, and then ask again, until you are clear. · FINALIZATION – Once you have come to an agreement with the seller and your lender is completing their close process, your lender will prepare the loan documents and verify the status of the title. · THE CLOSING OF THE DEAL – If everything goes well, you can close the deal on the REO property. The lender and you must sign the documents transferring the house into your name. WHAT ARE THE PROS AND CONS OF BUYING AN REO PROPERTY COMPARED TO OTHER TYPES OF INVESTMENTS OR HOME PURCHASES? THE PROS OF PURCHASING REO PROPERTIES · NO BURDEN OF OUTSTANDING TAXES When you buy a foreclosed property, there are often no outstanding debts or taxes to worry about. Banks will take care of these issues at possession in order to ensure that they remain the primary lienholder on the property. · HIGH RETURN
FHA APPRAISAL: GUIDELINES AND REQUIREMENTS IN 2022
As a Real Estate Investor or home buyer, you’re probably familiar with FHA appraisals. Appraisals are important because they help to protect both the lender and the borrower. Lenders like appraisals because the appraisal confirms that the property is worth enough to cover the loan. Likewise, borrowers like appraisals because it reassures the borrower that they aren’t overpaying for a property. If you’re looking to buy a house for the price of a car, FHA financing can be used to finance both single-family houses as well as small multifamily investment properties, as long as the house serves as your primary residence. MY SMART COUSIN specializes in helping aspiring property investors and homeowners, particularly people of color and women, buy a house for the price of a car. As a seasoned Real Estate Investment coach, we take budding entrepreneurs and property investors from idea to action, help you scale your financing, and walk hand-in-hand with you to develop and put in place your customized Real Estate Investment strategy. FHA BACKGROUND The Federal Housing Administration, or FHA, has been around for nearly a century and was founded in 1934. The FHA is a government-backed mortgage insurance company that insures mortgages for people who can’t afford a large down payment. Stepping in as a mortgage guarantor of sorts makes it easier for people to buy a home, as the lender knows that if push comes to shove and the borrower defaults on their loan, FHA will pick up the tab. With inflation and mortgage interest rates reaching new heights, it pays to stay current on lending practices. In this blog, we’ll take a look at what’s changing with the FHA appraisal process in 2022. Keep reading to learn more! WHAT IS AN FHA APPRAISAL? An FHA appraisal is required by lenders to ensure that a potential property is a good investment. Although, as mentioned earlier, FHA guarantees repayment of a large portion of the loan if a homeowner defaults, banks prefer not to find themselves in this situation. After all, the lender makes money by collecting interest payments on the mortgage, so having the loan paid off early by FHA runs counter to this. One of FHA’s top concerns when evaluating an appraisal is ensuring that the property itself is durable, safe, and fit for habitation. The hired appraiser will look at the property inside and out and check for health and safety issues— for instance, the structural integrity of the property, electrical wiring, and mold or mildew issues. Additionally, the appraiser will look at factors that impact the house’s value— for instance, a swimming pool, a garage, and the condition of the home, and major systems such as the roof or furnace. Appraisers also evaluate the features of comparable homes that were recently sold. So even if you have no interest in keeping up with the Joneses, FHA takes an active interest in them from a valuation perspective! BASIC COMPONENTS OF AN FHA APPRAISAL The FHA appraiser looks for the good, the bad, and the ugly regarding the value of the home and any factors that could prevent it from being occupied long-term, as these factors contribute to the property’s longevity and marketability. Two key areas of focus for the appraisal are pests and paint type. Pests don’t refer to an ant or spider here and there, but rather whether there is an infestation or any damage to the property— for instance, damage to supporting wood beams caused by termites or carpenter ants. Paint refers less to the color or style of paint and more to its safety, specifically, if there are areas of the house that have lead-based paint. Houses built before 1972 are more likely to have used lead-based paint versus newer houses. Other areas on the appraiser’s checklist include the following: · THE PHYSICAL CONDITION OF THE BUILDING ° The foundation, roof, and exterior must not be damaged. ° A big NO to insect infestation ° The wiring and the electrical systems must not be exposed. ° Sufficient ventilation of attics. · THE LIVABILITY OF THE BUILDING ° The utilities must be in good working condition including heat and clean water. ° A shielded sanitary sewage disposal system must be present. ° Lead paints should not be used. ° Fire codes and applicable safety codes should be met. · THE CONDITION OF THE PROPERTY SITE ° The soil should not be contaminated. ° The route of the drain pipes must point away from the home. ° The property must be accessible and safe. Market Comparables ° The appraiser evaluates the price of two comparable properties that have sold within the last 90 days. ° In a volatile market, a period of 30-60 days will be used and three comparable properties will be selected. ° Additionally, market comparables will be selected for properties that have not closed yet and are still listed for sale. Typically the appraiser will select two properties for this analysis. ARE THERE ANY POTENTIAL ISSUES THAT COULD ARISE DURING OR AFTER THE FHA APPRAISAL PROCESS? A clean FHA appraisal puts you one step closer to owning a home, but what happens if the appraisal report raises issues or has a lower than expected value? ° IF THE FHA APPRAISAL REQUIRES REPAIRS In some cases, the lender will conditionally approve a loan if the appraiser states that renovations or updates to the home are required to bring it into compliance with safety standards. In such instances, the buyer can negotiate with the seller to determine whether these renovations will be paid for by the seller or will instead be paid in whole or in part by the buyer. ° A LOW-PRICE APPRAISAL If the appraised value of the home comes in lower than the sales price, then, much as with the renovation scenario above, the buyer and seller will need to negotiate to determine how this lower value will be split. Buyers sometimes despair in the face of a lower appraised value, but this decreased value can force a seller’s hand to provide a price that while lower, is closer to market. FINAL THOUGHTS An FHA appraisal is an evaluation
5 REAL ESTATE GOALS EVERY SMART PROPERTY INVESTOR SHOULD SET
Undoubtedly, Real Estate Investing can be a very lucrative endeavor. However, to achieve success, you need to have a clear plan and set goals. Once your goals are set, ongoing refinement and performance assessments are required to ensure your roadmap remains relevant. Property Investment offers a range of opportunities, from low-cost purely passive investing vehicles such as real estate investment trusts (REITs), to higher cost, and often higher return, active investing through ownership of multifamily and single-family rentals. MY SMART COUSIN helps clients, with a special focus on Black and Brown folks and women, identify, evaluate and close on real estate investment opportunities. We educate clients on the benefits, risks, and strategies of property investment, and in particular, how to Buy a house for the price of a car. As a seasoned Real Estate Investment Coach, we help you move from idea to action, and turn your dream of being a property investor and/or homeowner into a reality. Are you thinking about becoming a real estate investor? Or are you already one, but looking to scale your portfolio, tap into additional financing or improve your skills? Regardless of your experience or current portfolio, it’s important to set goals at every step of your investment journey. That’s why we’ve put together a list of 5 goals that should frame your real estate investment business plan. Keep reading to learn more! beylikdüzü escort bayan, gaziantep escort, ataköy escort, esenyurt escort, seks hikayesi, kayseri escort, şişli escort, beylikdüzü escort, beylikdüzü escort WHAT ARE THE 5 SMART GOALS FOR PROPERTY INVESTMENT? Every successful person envisions a path to success, even if the road ultimately taken is quite different than the original plan. SMART goals can provide you with a compass of sorts to hone in on your objectives and set you up for success. SMART goals are often used in the corporate setting to create departmental and career goals. But they also work well to define your real estate strategy. SMART stands for – · Specific · Measurable · Attainable · Relevant · Time-bound If you are an investor looking to get the most out of your real estate investments, then using SMART goals can help. This technique helps narrow down what is important and makes sure that nothing is left behind. SPECIFIC REAL ESTATE GOALS The Real Estate Investing world is a vast and diverse one, with many different styles of investing (fix and flip, wholesale, turnkey, etc.) and real estate types (single-family, multi-family, commercial, vacant lots, and so on). Because of this broad range, it can be easy to get lost in the weeds. Setting clear objectives helps you stay on track, as you progress from goal-setting to goal-assessment to goal-fulfillment. If you’re a visual learner, printing your SMART goals and hanging them in a place you’ll see often can also help remind you where you’re going. Important to creating SMART goals is ensuring that your objectives are stated clearly so that you know what you meant by them months later when reviewing them. MEASURABLE REAL ESTATE GOALS Why are measurable goals better? Simply put, because measurable goals give you an objective yardstick to determine if you’re on track or off-track, and to measure how much progress you’re making. Additionally, measurable goals help rein you in so that you don’t set goals that are entirely out of reach. For new investors especially, it can be helpful to set numerical targets— for instance, ‘visit 5 potential multifamily investment properties by September’ rather than qualitative hard-to-judge targets like ‘go see more properties’. Sharing your goals with a family member or business partner can also help keep you accountable. ATTAINABLE REAL ESTATE GOALS Create goals that strike the right balance of challenging enough to push you, but also practical so they feel attainable. Creating objectives that are unrealistic or overly ambitious can be de-motivating and ultimately cause you to give up, or spin your wheels pursuing goals that are better served for year two or even in your business. RELEVANT REAL ESTATE GOALS Relevant real estate goals get to whether your objective— buying a multifamily property or your first home— really aligns with your life plans at this point in time. For instance, if property investing, while a worthy pursuit, is one of ten other critical things that you’re chasing in life, then it might make sense to take a hard look at your priorities and determine what should be done first, versus going all-in on real estate no matter what. TIME-BOUND GOALS Real estate investing is not just about rent revenues, it’s also an excellent opportunity to build your generational wealth. The surest way to turn your words into action on this front is to set milestones, breaking each goal into a set of tasks, with a timeline for when each task will be done. Setting a date for the achievement of each goal can give you a specific target to shoot for. FINAL THOUGHTS Congratulations! You’ve set your SMART real estate goals. Now what? Each goal will require a different plan of action to achieve success, so it’s important to tailor your strategy accordingly. Thanks for reading and happy investing. RECOMMENDED READ: HOW LONG IS AN APPRAISAL GOOD FOR? 5 FACTORS TO CONSIDER FOLLOW US: @MYSMARTCOUSIN
HOW LONG IS AN APPRAISAL GOOD FOR? 5 FACTORS TO CONSIDER
If you’re in the market for a new home, you’ll likely encounter an appraisal. What would be more gracious than Buying a house for the price of a car? An appraisal is a process where a licensed appraiser assesses the worth of a property. Appraisals are used by buyers, sellers, and lenders to help determine a property’s value. At MY SMART COUSIN, we are here to provide our people with the best and most updated information on Real Estate Investment strategies. We help our Black & Brown folks (especially women) to Buy a house for the price of a car. As a Real Estate Investment Coach we encourage people about how they can be the owner of their own sweet home and can scale their finances. Have you ever wondered how long an appraisal is valid? If so, you’re not alone. While the answer may seem straightforward, there are a few factors to consider when it comes to home appraisals. In this blog post, we’ll take a closer look at five of the most important factors to keep in mind when it comes to appraisals. Read on for more information! WHAT IS AN APPRAISAL AND WHY DO YOU NEED ONE WHEN BUYING A HOME? The value of your home is determined by an appraiser, and if you want to get the most out of it financially then be sure that there will not only be one but several reports generated. A licensed third-party specialist in this field creates these invaluable documents which provide crucial information about what kind or condition property each instance might present as well as any notable features such—as visible defects/ damage on exterior surfaces among other things not visible from afar. If you want to get the best deal for your home, it’s important that an appraiser reviews and records all of the upgrades or improvements. The middleman will assess how well-maintained property is before lowering its price based on what buyers want; he also has experience in raising prices when sellers haven’t taken good care of their properties – giving them more incentive than ever! You might not think that an appraisal would be important while buying a house, but you’d likely regret it if the price set by your appraiser is too high. The cost of getting this done can make or break whether someone buys your home! So take advantage and get as much information out there about what’s going on with all aspects before meeting any deadlines–you’ll feel like a hero when they finally open escrow!! HOW LONG IS AN APPRAISAL GOOD FOR? Appraisals are a great way to get an idea of what your home is worth. The length depends on the factors such as loan type, market state, and location but six-month validity typically applies more often than not means you’ll need two-six months’ worth when going through this process with any one client! One thing that can affect, is how long they last though? Comps – these use prices from recently sold homes close in size/conditions so expect 90 days instead if outside those ranges since there isn’t always enough data available yet within each specific region or city block. FACTORS TO CONSIDER WHEN DETERMINING THE VALUE OF YOUR HOME 1. THE TYPE OF LOAN The type of loan the buyer is seeking may influence the length of time an appraisal is valid. · CONVENTIONAL LOAN – These loans are less restrictive and highly flexible in terms of appraisal. On existing homes, an appraisal is good for 120 days while on new construction, the appraisal will be good for an entire year. · USDA LOANS – These are government loans that are specially structured for people in rural areas. Appraisals for USDA loans are valid for 120 days in addition to a grace period of 30 days. · FHA LOANS -On an FHA loan, the appraisal will be valid for 120 days and if updated it will be valid for 120 days. If the case number assignment changes, you’ll have to order a re-appraisal. · VA LOANS– VA loan appraisals are valid for 6 months and after the expiry period a re-appraisal will be required. · FANNIE MAE LOANS – Fannie Mae (FNMA) loan appraisals are normally valid for a full year but require a second appraisal after 120 days. 2. THE CONDITION OF THE PROPERTY The state of the property affects its appraisal. If any major changes occur, like an improvement that would increase or decrease the value by 100 thousand dollars for example (even though it might only seem like a small change), then we will take those into account when determining how much your home is worth today versus if there was no such event occurred over time since this could have led to significant differences in net equity between you and preset grammar rules The damage can come from fire breakout accidents, natural disasters such as Floods earthquakes, etc 3. THE PRESENT SCENARIO OF THE MARKET The state of the market also affects how long an appraisal will be valid. If there’s slow change and stability, then it should only take six months for a new one to come out before you get your money back on previously paid-off homes; but when things are changing rapidly or becoming unstable – like during economic bubbles– appraisals can last 30/60 days instead because they’re more focused around specific dates rather than just general periods throughout time 4. UPDATE & EXTENSION OF APPRAISAL The lender might order an update or extension of approval if your appraisal expires. This is because they want to make sure the property’s value has not declined since it was last appraised, and also give them more time before paying out any mortgages on these properties with decreasing values at risk (as would happen over time). 5. RECERTIFICATION OF VALUE An appraiser might make a valuation that’s conditioned on the property meets certain conditions. In this case, they’re simply following up to see if those requirements have been met and will conduct certification of value when necessary. The original assessor valued your home at $500K
REAL ESTATE PARTNERSHIP STRUCTURE 101: Do’s & Don’t’s
Partnerships can be a great way to pool resources and increase your chances of success in Real Estate Investing, but there are a few things you need to know before you get started. Almost every successful real estate investor has gotten where they are today by teaming up with other people to do bigger and better deals. As the African proverb goes, if you want to dash off and go fast, go alone, but if you want to truly go far, go together. The integral component of a successful real estate business lies in being aware of its incredible opportunities and utilizing them at the right time. You can easily Buy a house for the price of a car and be the owner of your own sweet home. At MY SMART COUSIN, we act as your most trustworthy Real Estate Investment coach who is determined to make you aware and teach you about real estate investment strategies. We help our Black & Brown folks mainly women to scale their finances and how they can Buy a house for the price of a car, not one but thousands. If you’re like most people, you probably think of real estate as a pretty safe investment. After all, everyone needs a place to live, and demand for housing always exceeds the supply, right? Well, it turns out that real estate can be a risky investment after all – especially if you don’t know what you’re doing. In this blog post, we’ll take a look at some of the do’s and dont’s of real estate partnerships. So whether you’re just starting in real estate or you’ve been investing for years, read on to learn more! WHAT IS A REAL ESTATE PARTNERSHIP STRUCTURE AND WHY WOULD YOU WANT ONE FOR YOUR BUSINESS? When two or more investors combine their capital and expertise to buy, develop, or lease property is known as a Real Estate partnership. Both the real estate entrepreneurs decide to work together in a professional environment and put their endless effort into accomplishing a single goal. For most real estate partnerships, the general partner takes on more responsibility and liability in exchange for a bigger share of profits. However, some only have passive investors or limited partners who don’t participate actively except when necessary One might wonder, why would he want a partnership in the real estate business? Well, there are many benefits. For starters, it’s easier than trying to do this on your own! You also get more exposure and an outside perspective which can help guide you in the right direction when making decisions about what kind of investments or properties will best suit both yourself as well as those who invest alongside them (i e.; partners). You’ve probably heard stories before where one investor seeks out another looking for financial backing but if that isn’t possible then maybe consider putting together some sort of group deal-like structure where everyone contributing something gets their desired outcome. THE 3 MOST COMMON ENTITY PARTNERSHIPS There are numerous ways through which Real Estate partnerships can be formed. Amongst them the most common types are – ° LLC or Limited Liability Company ° LLP or Limited Liability Partnership ° S-Corporation The benefits of owning a real estate partnership are twofold. First, the income or losses from your investment will be passed through to you on personal tax returns which eliminate any taxation at both corporate and private levels; second these partnerships offer extra-legal protection should there be claims against other assets not directly associated with this particular business venture–you’re protected by virtue being part. THE BENEFITS & DRAWBACKS OF REAL ESTATE PARTNERSHIP The one who lacks real estate knowledge or experience must go for the idea of a real estate partnership. If for nothing else, a truly great partnership can easily be the one thing new investors need to get started on the right foot. The best real estate partnerships act as a solid foundation for creating a great deal of balance between relationships, satisfaction, practicality, and essentials. Here are some of the biggest pros and cons of a partnering up to help ensure the one you create will be as powerful as possible: BENEFITS OF REAL ESTATE PARTNERSHIP ° A correct partner will always open the door for extra resources such as more capital, skills, network, and connections as well as professional expertise. ° The partnership provides a flexible distribution of profit & losses. ° For the one who wants to generate a passive source of income, a real estate partnership is beneficial for them. ° The personalities of each partner can combine to create a powerful presence in meetings with lenders or additional investors. ° When one partner is responsible for day-to-day responsibilities, they need help with longer-term strategies. The Real Estate Partners are essential in making sure that the project runs smoothly and equally share their workload so there can be no imbalance or sole focus on any single task at hand. DRAWBACKS OF REAL ESTATE PARTNERSHIP ° When two or more people invest in the same business, each person’s share is limited by how much they put into it. The benefits of investment – such as monthly income and profits from its sale – must be shared among all partners involved so that no one investor can reap too many rewards at once! ° An unclear partnership agreement may give rise to several disputes arising between partners in terms of delegating responsibilities and can turn your profitable investment into a loss. ° Different personalities of the partner give rise to versatile management& organization styles, which can be the cause of conflict between the partners. ° Sometimes capital differences also become one of the causes of disparity in the partners. ° Partnerships can get strained when one partner feels they are doing more than their fair share without getting an equal return. This could lead to tension between the two parties and even resentment toward each other, which may result in strain on relationships over time if not resolved professionally/amicably WHAT ARE THE THINGS TO CONSIDER WHEN SETTING UP A REAL ESTATE PARTNERSHIP STRUCTURE FOR YOUR
HOW TO BUY A MULTIFAMILY PROPERTY ON A BUDGET
Interested in investing your money in a multifamily property? You might be wondering, “Can I buy a two, three, or even four-family building with limited funds?” Fortunately, the answer is yes, though it will take some work on your part. But before we get to that, let’s first look into the multifamily model. Multifamily investments involve buying a duplex, triplex, fourplex, apartment building, or condo building and renting these multiple units, sometimes referred to as ‘doors’. Multifamily investing offers the possibility of generating a large burst of cash flow and net operating income from one building and roof. For this reason, multifamily property investment is often viewed as the first step of moving into larger, higher-yielding deals and thus, a popular investment channel for Real Estate investors. If you’re thinking about buying a multifamily property and prefer not to go it alone, you’re in good company as the services of an able coach can help increase your likelihood of success. At MY SMART COUSIN, we work hand-in-hand with clients to find and evaluate lucrative multifamily investment opportunities, with our specialty being finding houses that you can buy for the price of a car. As a seasoned Real Estate Investor and Investment Coach, we help Black and Brown folks and women create wealth and scale their businesses. In this blog post, we’ll discuss the benefits of a multifamily portfolio, and look at options you can use to buy multifamily when your funds are on a diet shall we say, and seed capital is limited. If this scenario sounds like you, read on to learn more! THE MANY BENEFITS OF MULTIFAMILY PROPERTIES A Quick Way to Scale Your Portfolio: One of the biggest benefits of buying multifamily properties is that it allows you to increase the number of units that you own quickly, and often, at a lower cost per unit than buying each unit as a single-family property. A larger number of units allows you to spread fixed costs such as bookkeeping, legal fees, and marketing over a much bigger base. Additionally, the amount of time required to grow a portfolio from one unit to ten units is significantly more when growing through only single families versus multifamilies. Diversification of Risk: Another benefit of multifamily properties is that they can lessen the cash flow risk of your portfolio. As an example, if you own and rent out a single-family home when the home is vacant, it is 100% vacant, unless you are renting out a room or other area of the house on a short-term basis. The all-or-nothing risk to cash flow that comes from single-family properties can cause owners to face financial hardships when their unit is vacant for an extended period. Multifamily properties, on the other hand, have multiple units, which decreases the risk that every unit will be vacant at the same time. As such, there’s a much higher possibility that there will be positive cash flow at some point of every month for multifamily, particularly if the multifamily has five or more units. This risk diversification can help in ensuring that the loan used to buy the property can be serviced without interruption Economies of Scale: In much the same way that buying groceries at a wholesale store can lower the per-unit cost of each item, likewise a large multifamily property can increase your buying power and lower the per-unit cost of management and maintenance items. Property managers, as an example, will be more likely to offer you a discount if they are managing 20 of your units, all under one roof, than 20 separate single-family homes. Twenty apartments in one building mean that a dedicated leasing agent and handyman can be tasked with working at one location rather than traveling among multiple properties and learning the peculiarities of each. Likewise, electricians, plumbers, and other contractors may offer more competitive pricing for the security of having one large apartment building account versus multiple small accounts. beylikdüzü escort bayan, gaziantep escort, ataköy escort, esenyurt escort, seks hikayesi, kayseri escort, şişli escort, beylikdüzü escort, beylikdüzü escort So now that we have a sense of some of the benefits that a multifamily property offers, let’s dive into exactly how we can go about buying one on limited funds · AN EQUITY SHARE INVESTOR: THE KEY TO SUCCESS An equity share investor is someone who takes an equity interest in your property in exchange for funding a percentage of the acquisition costs and major repairs. As an example, if you strike a deal with an equity share investor to invest 30% of the costs to buy a $200,000 triplex, or $60,000, then the equity investor would be entitled to 30% of the rent on the triplex. In this regard, shared equity arrangements are like partnerships. One difference, however, is that shared equity agreements often have a limited time period, for instance, five years, after which the equity share investor will look to have their percentage interest purchased by the owner, at the presumably higher market value of the property in year five. Because shared equity investors own a percentage of the equity in your property and are recorded as owners on the deed and in tax records, it will be critical to work with an experienced attorney to document this transaction properly. · GET A LOAN FROM A FAMILY MEMBER OR FRIEND – A PRIVATE MONEY LOAN Private money lenders are lenders who are private individuals. As such, a private money lender can include your family member or a friend. If you lack the funds for a multifamily property and share common business values with a friend or family member, then you may want to explore having them serve as an official lender for your project. A private money loan with a close family should be treated just as seriously as it would be with a third-party lender: credit checks should be performed, and loan documentation and a payment schedule should be developed. The benefit of working with a friend is having a built-in sounding board to discuss issues or opportunities. · CONSIDER BUYING
HELOC PROS AND CONS YOU NEED TO KNOW
The housing market is on an upswing with prices climbing higher, driven by the twin forces of inflation and demand. Which begs the question: can you still Buy a house for the price of a car? Absolutely! On any given day there are hundreds of single-family homes, and even some viable multifamilies, listed for $60,000, $50,000, and even $40,000. At MY SMART COUSIN, we teach clients, especially Black and Brown folks and women, exactly how to evaluate and buy these properties, as well as how to start or scale their business and build their finances. As a successful real estate investor and real estate investment coaches, we help clients make the right choice, based on their present circumstances and goals. THE VALUE OF A HELOC If you’re a homeowner, you know that having a home equity line of credit (HELOC) can come in handy. A HELOC is like a credit card connected to your home’s equity – it’s a great way to borrow money when you need it. But before you decide if a HELOC is right for you, be sure to weigh the pros and cons. Here are some things to keep in mind: WHAT IS HELOC AND HOW DOES IT WORK? HELOCs are a great way to get access to money without the hassle of applying for credit cards or other personal loans. You can use your home equity line for anything you want, but there will always be interest charged so it’s important not to use your HELOC like your own personal ATM! HELOCs work like credit cards. You can use your home equity line of credit for both home-related renovations and repairs and non-home-related items like paying off car notes, credit cards, or other expensive debt. Since HELOCs are attached to your home, the cash you drawdown is essentially a second mortgage. Meaning that once you draw on your line of credit, you have two mortgages outstanding on your property instead of just the one you started out with. This point is worth paying special attention to as your house itself is at risk if you default on your HELOC. For those who are considering a HELOC while heading towards or are already in retirement, an emergency fund might make sense to add an extra buffer of protection and ensure that you can repay your HELOC. THE PROS OF USING HELOC TO FUND HOME IMPROVEMENTS OR OTHER EXPENSES · LOWER INTEREST RATES HELOC interest rates are much lower than credit cards or personal loans. The reason is that while credit cards are unsecured, relying solely on your promise to repay, HELOCs are secured by your home. HELOC loans often also have an interest-only component to them, allowing you to pay just the interest for as long as ten years before having to repay the principal. The interest rate is variable rather than fixed, so drawing on your HELOC during high-interest, high-inflation periods is less optimal than under low-interest rate and inflation climates. But that said, under certain conditions the interest payments on a HELOC are tax-deductible, helping to lessen the sting of high rates. · FLEXIBLE AND ADAPATABLE The greatest advantage of HELOCs is that they are flexible and able to accommodate your needs. Unlike a loan, a line of credit, once approved, sits in standby mode, giving you the convenience of having it available without the obligation of having to use it. Since HELOCs are approved for a ten-year period, the line of credit serves as a guaranteed secondary source of funding for ten years, should you need it or choose to use it. · USE OF MONEY Ideal uses for a home equity line of credit are saving and investing money. On the savings front, you can use your HELOC to consolidate debt or pay off more expensive loans. On the investment front, a HELOC can serve as seed capital to start a new venture, buy stocks or other investments, or buy an investment house for the price of a car. You are also allowed certain tax benefits if you use a HELOC for home renovation. · THE APPROVAL TIME The approval time for a home equity line of credit is very short, on the order of a couple of weeks, which means that you can get your finances in order and launch your investment or debt repayment plan much faster than if you were to apply for a business loan or personal loan. · FEWER ADMINISTRATIVE COSTS The HELOC application process is much more affordable than other loan applications. There may be some additional charges which have to be paid, but these are minimal in comparison with traditional loans that require high processing fees. THE CONS OF USING A HELOC TO FUND HOME IMPROVEMENTS OR OTHER EXPENSES · FLUCTUATING INTEREST RATES One of the most important factors to consider when applying for a home equity line of credit is whether it has a variable interest rate. Most HELOCs have some type of variable-rate feature, which means that the interest rate could increase over time. · COLLATERAL A HELOC requires that you own your property. You do not need to own it outright, you may have a mortgage on it already, but you can’t obtain a HELOC if you rent the property, for instance. The reason is that the collateral for a HELOC is the property itself. The line of credit available for a HELOC is usually capped at 90% of the equity you have in the home. Using an example, if your home is worth $200,000 and you have a mortgage of $100,000 on it, then your equity in the home is $100,000. A 90% loan to value ratio means that your HELOC would be $90,000. · HIDDEN FEES AND CHARGES Your lender may charge hidden fees if you cancel or terminate your HELOC. In some cases, the bank will bill an amount even when there is no balance owed at all. As always, it pays to read the fine print before taking out any loan because it could cost more than expected in unexpected expenses. · THE TEMPTATION TO MAKE ONLY MINIMUM PAYMENTS When you take
Long Term Rentals or Short Term: Which Strategy Would You Choose?
One of the great benefits of being a homeowner today is that you have the opportunity to make money on your property in two ways. The first way that most everyone is familiar with is an appreciation of the home’s value. While we all appreciate our home because it provides a roof over our heads, we don’t mean that kind of appreciation. We mean the kind of appreciation that happens as prices rise. Home prices generally rise with inflation. While inflation has been a sizzling eight percent of late, over the past 60 years it has averaged a little under four percent. At that rate, it would take approximately 18 years for your home price to double. Meaning, that unless your neighborhood suddenly becomes the place to live, or, our personal favorite, unless you buy your house for the price of a car, you’d better pack your patience when it comes to realizing the appreciation value of your home. The second way realizes a return on your house is by renting it out. And the good news is, that the range of rental options is increasing every year, allowing you to create a structure that works for you. Given these two methods of earning a return on your home-sweet-home, it pays to educate yourself on the numerous factors involved when buying a property, so that you can take advantage of both avenues. My Smart Cousin can help you figure out how best to wring appreciation and rental value from your current home, or help you find a house for the price of a car that has a high appreciation and rental value. If you’re a real estate investor focused on renting out your home, something you’ll need to decide early on is if you want to offer your property as a long-term rental or a short-term rental. Both strategies have their pros and cons, so it can be tough to decide which one is right for you. In this post, we’ll take a look at the advantages and disadvantages of each strategy, so you can make an informed decision about which option works best. A BRIEF INTRODUCTION · LONG-TERM RENTALS – In most jurisdictions, when you lease a property for more than one month (30 consecutive days to the same person), the rental is considered a long-term rental, and is regulated under landlord and tenant laws. The one-month rule holds whether you rent the entire home or just one room in the home. Likewise, the interpretation applies whether the tenant pays for utilities or does not explicitly pay for utilities (that is, you charge a room rate with no language in the contract regarding utilities). If the tenant doesn’t live at the home full time but has a one-month or longer contract, or, if you have permitted the tenant to store their belongings in the home while not ‘living’ there, the one-month rule would likely still hold. As such, if your intention is to rent out your home or a portion of it on only a short-term basis, then ensure that the contract and tenant occupancy match this intent. SHORT-TERM RENTALS – The best alternative to a hotel is a short-term rental. And in fact, many guests prefer staying at a home (either renting the entire home or just a room or sofa) rather than booking a stay at a hotel. Short-term rentals can be an excellent way for a guest to experience a city in an authentic way, can be more comfortable than a home, and are often more affordable. One of the biggest attractions of a short-term rental home, however, is that the guest can make use of private indoor space as well as outdoor space. If you have a balcony or lovely yard, this can place you at the top of the list for out-of-town and local guests. HOW DO YOU DETERMINE WHICH OPTION IS BEST FOR YOU The decision to use a property for either short-term stays or long-term rentals comes down to one important question – which option works best for you— your lifestyle and way of life? By considering the pros and cons of each option, you can make more informed decisions about how best to fit this investment into your plans. THE PROS AND CONS OF LONG-TERM RENTALS ADVANTAGES A CONSISTENT CASH-FLOW – Long-term tenants are perfect for those landlords who want a consistent cash flow that they can depend on. With a high-quality, long-term tenant in hand, you have a roommate who can help you pay for the expenses of your home. MINIMUM TURNOVER – If you hate the idea of a new person coming to stay with you every day or week, then a long-term structure allows you to minimize turnover. Less turnover not only minimizes the disruptions from revolving-door roommates but also cuts down on paperwork— from the marketing promotions that need to be done with a short-term rental, to the increased bookkeeping from tracking multiple transactions. UTILITIES – Unlike hotel guests or guests in a short-term rental property, long-term tenants will not be surprised when you tell them that they must pay a percentage of the utility bills. Water, electric, and gas bills can spiral out of control when you don’t see them or have to pay for them. Long-term tenants or roommates help keep these expenses under control. · DISADVANTAGES PROFIT MARGINS – A big disadvantage of long-term rentals is their overall profitability. Profits for long-term rentals typically are lower than for short-term rentals because short-term rentals charge a higher daily rate. A condo that is renting for $1,500 a month in an urban neighborhood, for instance, means that if the $1,500 were paid on a daily basis, the cost would be approximately $50 a day. On the other hand, finding a short-term rental in an urban neighborhood for $50 a day, for an entire condo, would be extremely rare indeed. CONTROL OVER THE PROPERTY – With a long-term tenant, there is much less privacy and control over the property, as you’ve rented out a room, for instance, to someone else, who has the right to stay in the house
HOW TO REHAB A REAL ESTATE PROPERTY: THE FIVE STEPS MOST INVESTORS MISS
The housing market continues at its five-alarm fire pace, offering both opportunities and risks to aspiring homeowners and investors. For those in the know on how to Buy a House for the Price of a Car, real estate can be a lucrative strategy indeed; but it doesn’t always come easy. If you’ve made the leap and purchased your first investment property, congratulations! After you’ve poured yourself a glass of bubbly, buckle up, because this is where the real work begins! As a seasoned Real Estate Investment Coach and Successful Investor, we at My Smart Cousin take seriously our responsibility to help our clients, particularly Black and Brown folks, increase their generational wealth and influence. Now more than ever, there is an opportunity to make money in the real estate game through rehabbing homes. Scoring a great deal on your investment property is an important first step, but it’s not the only one. Before you jump in head first, it’s important to understand the fundamentals of rehabbing, so that you can renovate your property quickly and cost-effectively and get it on the market. In this article, we’ll outline the five key elements to rehab a property like a pro. So, if you’re thinking about getting into the rehab business, read on for some helpful tips! WHAT EXACTLY IS A REHAB? Rehabs come in many flavors. Some properties require nothing more than a coat of paint, while others require a full-on makeover, from a new bathroom and kitchen to flooring, appliances, and fixtures. What distinguishes a rehab from a full gut job is that rehabs usually involve improvements to superficial items like drywall, tile, and carpets while gut jobs veer into the world of construction, requiring permits for electrical, plumbing, roofing, and HVAC work. In either case, whether you’re donning a hard hat or just a pair of overalls, rehabbing a property is rarely easy. A successful rehab requires patience, skill, and planning. Once armed with these resources, an investor can look to earn back not just their original investment, but also a return on their investment. YOUR REHAB ROADMAP 1. DETERMINE YOUR INVESTMENT HORIZON One of the first questions a successful rehabber must answer is, what is their investment horizon. That is, will the property in question be renovated and then rented or leased out— a buy and hold? Or is the goal to renovate and immediately list the property for sale— a so-called buy and flip? Your objective for the property as either a buy and hold or a buy and flip can affect how quickly the rehab needs to be finished, as well as at what cost. beylikdüzü escort bayan, gaziantep escort, ataköy escort, esenyurt escort, seks hikayesi, kayseri escort, şişli escort, beylikdüzü escort, beylikdüzü escort Assess the Real Estate Market Fundamentals In determining whether your rehab will lead to an immediate rental or sale, let the local real estate market and market fundamentals be your guide. If rental rates are on the rise and the neighborhood is chock-full of long-term and short-term rental properties, then a rehab-to-rent approach may be in the cards. On the other hand, if every second or third house is holding an open house, with houses snapped up after only days on the market, then a rehab-to-flip approach might make more sense. My Smart Cousin can help you do a market analysis to determine whether a rental or flip makes more sense as well as what the potential costs and returns of each path look like. 2. ASSESS THE CONDITION OF YOUR PROPERTY AND MAKE A PLANBefore purchasing your property, it’s important to assess the home closely and determine whether there are any major issues requiring repairs or outright replacement of totems such as the wiring, HVAC (heating, ventilation, and air condition), or sewage systems, as these can be expensive and time-consuming to remedy. When doing your walkthrough with your handyman or contractor, bring a camera or use your cell phone and take both pictures and video. When taking video, narrate as you go with comments on what room you’re in (for instance, ‘bedroom next to the bathroom’), the issue you see (for instance, ‘evidence of water leak in master bedroom ceiling’), and the steps to take (for instance, ‘have handyman or roofer take pictures of the roof to determine its age and condition). 3. FLESH OUT YOUR REHAB BUDGET AND WHAT YOU HOPE TO ACHIEVE WITH THE PROPERTY An important part of renovating your home is knowing what needs to be done. This will help you stay within budget and avoid expenses that don’t deliver a return on your investment. You can assess whether a particular expense will yield a return by calculating the after-repair value (ARV) of your property. The ARV value is the new and improved value of your property after taking into account the cost of the work you’ve done as compared to the market price for similar homes. As an example, if you purchase a house for the Price of a car, let’s say at $40,000, and renovate it for $30,000, with the high-ticket items being new appliances, kitchen cabinets, and upgraded fixtures and lighting throughout the home, then your effective property cost is $70,000. But $70,000 isn’t the ARV value; the ARV value is the market value of houses that are in the same condition as your newly-renovated property. If average properties in the neighborhood are selling for $100,000 but come with upgraded appliances and fixtures that are move-in ready (like your home) are selling for $115,000, then the ARV of your home is $115,000. Knowing the determinants of market value and the price of these homes is key to determining a renovation budget, both in terms of how large it should be and what gets you the best bang for your dollar 4. CREATE A WORK PLAN FOR THE PERSON WHO WILL BE DOING THE WORK, WHETHER THAT PERSON IS YOU OR A CONTRACTOR CREW Hiring a contractor is often the most daunting part of any home renovation. But doing the work yourself is also no walk in the park. To reduce both the headache and cost of