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If you invest in residential rental property in your real estate IRA for any significant length of time, sooner or later you will probably need to consider evicting a tenant.
There are several possible reasons you may need to evict someone: The most common, by far, is the non-payment of rent. Other common reasons include drug or other criminal activity or material violation of lease terms. Sometimes you can resolve these issues painlessly, by giving the tenant a little extra time, or by sending a notice to cure or quit the premises. But when these measures don’t work, a real estate IRA owner will have to ‘landlord up’ and begin eviction proceedings to get the tenant out.
Before you begin evicting a tenant from your real estate IRA-owned property, read this first. Read More >>
In Part One of this article, we discussed YOU and why you do the things you do. Specifically, we talked about WHY people do or don’t do things for two primary reasons: To gain pleasure or to avoid pain. This is also known as the Carrot or the Stick - the carrot is something good that we want, while the stick represents the pain we don’t want.
We also mentioned a few common things that most people in this world want/desire, like love, money, and good health as well as a few things that most people don’t want/are afraid of, like fear of missing out, getting hurt, rejection, or clowns. ;)
Finally, we talked about some stuff that you might not like - why you may not be as successful as you’d like to be, or why you don’t always do some of the things you know you should be doing.
In other words, we started with YOU. Still stuck on that? Ok, go back and read the article again. But if you’re ready to move on, let’s go... Read More >>
I know last month’s article was a little depressing but it was important and here’s why: We take daily actions in pursuit of a better life, to move away from pain and towards happiness, while the underlying emotions of fear and greed drive us. It is within these actions that we should investigate and become aware of their effects. The “better life” has a price and that price is unknown. The “better life” is culturally conditioned.
I remember one time when I was a kid I was grounded for the day, and I sat at my window staring out with my nose pressed as close to the screen as possible to feel any fresh air and sunlight I could. Seeing and hearing the other kids playing brought feelings of anger, fear, jealousy, and envy. I wanted to be outside so bad. But I sat and endured.
The idea behind that story was that there was plenty to do in my room to keep me busy while grounded. But I wanted to be outside, I wanted to be with other people. Deeper within was the fear of missing out on life and the fear of being alone. Read More >>
Watch the Fix and Flip Wholesale Shows on Television Just Don’t Believe Their Numbers, Time Frames to Complete the Rehabs and Their Repair Costs
Recently while surfing channels on my television I came across two real estate fix and flip shows that caught my attention. I watched each of these shows and as I watched it took all of my strength to not turn the channel in disgust. I couldn’t believe the incompetence of the people doing the shows. One of the shows was filmed in Orlando Florida and the other was filmed in Las Vegas.
I love a good comedy show as much as the next person but these shows were just too ridiculous to watch without feeling compelled to warn every unsuspecting and untrained investor not to believe what they see on these shows. Shows that never show any real facts and details about the properties they fix and flip. If you watch these types of shows be sure to take their numbers with a grain of salt and don’t try to replicate what is being shown before you make an offer to purchase any property. Read More >>
There has never been a foreclosed house which didn’t have potential profit written all over it. Today, several indicators including the firm RealtyTrac have released 1st Quarter 2017 data which shows foreclosure filings and default notices, scheduled auctions and bank repossessions are down over 5% from the prior Qtr, over 2016 and are the lowest since 2007.
Knowing the true value of real estate is critical, try to do a deal without it and see. The guidance and data within REIAComps has consistently shown investors how to determine both solid acquisition value and after repair value to earn lasting profits.
Some of the most stubborn foreclosure cases are finally being flushed out of the foreclosure pipeline, and we all can expect to see more noise in the numbers over the next few months as national foreclosure activity makes its way back to more stable patterns by the end of this year. Thus, while foreclosures are down, they will always be with us. As investors, this s a good thing! Read More >>
Every time I mention a capitalization rate to a group of learning based, future investors, I get this blank deer in the headlights’ look (not that I have stared many deer in the face). So I decided to simplify the meaning and amplify the importance.
The capitalization rate(R) is the rate of return used to estimate the property’s value based on that property’s net operating income. Often called a Cap Rate (Rate), it is the method for determining the attractiveness of the investment for the potential purchaser.
First one needs to understand net operating income (NOI). The net operating income is the annual income minus all expenses. Expenses would include taxes, insurance, management fees, homeowner’s insurance, common area utilities and any other expenses that is paid toward running this particular piece of real estate. It does not include the mortgage… never. This rate of return assumes that the property was paid for with cash. Therefore, when you see income on this formula, we are talking about the net operating income, or, NOI which we will use the single letter I to designate. Read More >>
The first thing you may have learned when you became interested in real estate investing was either the concept of other people’s money (OPM) and/or leveraging. These are key concepts to learn early so you can invest and grow faster. However, not many people show you how to find money and if you find money, how to leverage it.
There are many ways to go about finding money for your real estate investments. The easiest and guaranteed way that I know how to find money to fund real estate deals is to have solid deals. While wholesalers and some investors try and do peddle properties with slim to no margins, these types of deals will not guarantee you any respectable funding. You want to find investment properties that are at least 70% of market value minus repairs. By repair, I mean that the estimated repair budget is enough to transform the investment property into the home you are using to value the property. I bet that if you have a deal that meets this criteria you can find the funds to fund it. When you begin to look for funding you want to know you have a true deal. DO NOT, I repeat, DO NOT take another person’s information as being correct. Do your own due diligence. The last thing you want to do is attempt to raise money with a property that is not a deal. Read More >>
Whether you’re just launching a business or you’re going online with an existing company, take some time to get acquainted with QuickBooks Online.
Your first hour with any web-based application is probably spent exploring and clicking buttons, links, and other navigation tools to get the lay of the land.
QuickBooks Online should be no different. In fact, it’s even more important to take it slow when you’re using an accounting solution. If you start entering data without understanding how everything works together, you may make mistakes early on that will be difficult to undo down the road. Read More >>
I recently read a book by Grant Cardone called the 10x rule. I am rereading it again now because it made such a strong impact. I highly recommend as soon as you are done reading this article, you buy it immediately. I do not get any kind of credit for it. It’s simply a must read for investors, in particular wholesalers.
Wholesaling is a massive action business. It takes massive action to keep the lead funnel going which is what powers the entire business. In his book, Grant talks about four levels of action to give clarity as to what your goal should be. I paraphrase them below. Read More >>
“The one thing that unites all human beings, regardless of age, gender, religion, economic status, or ethnic background, is that, deep down inside, we all believe that we are above-average drivers.” ~ Dave Barry
Life360 is an app I can’t imagine life without. I have a 16 year old driver in my family and it gives me some peace of mind knowing I can keep tabs on his miles per hour, hard breaks, even his phone useage. It will even contact me in the event of an emergency like an accident or a break down. I believe this is a must have app for any new driver.
You can do more than just spy on your kid with this app. It’s a nice closed circle where you can view the real time location of friends or family members on a private map. There are many other options to use the app. For example, you can receive real time alerts when friends or family arrive or leave home, work, and school. It’s nice if you have younger kids and you don’t want them on social media, but you can still have that experience of sharing photos and text messages with our secure, private chat. You can easily add or delete people from your ‘circle’ and see past location history for your Circle. There is also a Crash Detection service that will contact the parent or guardian. The most impressive thing is that you can track a lost or stolen phone. Read More >>
Are you looking for the fastest, easiest, safest way to make money in today’s real estate market? Then you need to learn about notes! Notes are the number one way to quickly make huge cash profits in real estate, even if you don’t have your own cash or credit to get started. In most cases, you never even own the property, which really makes for a fast, easy, safe way to profit in this marketplace.
Many people are buying defaulted bank loans at very steep discounts, either as a backdoor to acquiring the property or in order to restructure the note into a very high yielding, passive investment. You can use the non-performing note (NPN) as leverage to get the property, either by negotiating “Cash for Keys” or by foreclosing on the property. Even with the time and expense of foreclosing, since you are buying the defaulted notes at very steep discounts, there are still fantastic profits to be made.
If you are looking for a passive investment, then you may want to focus on restructuring NPNs to allow the homeowner to stay in the property. Many people use this as a ministry to help distressed homeowners. Even though the homeowner is paying only a nominal interest rate, you can make super high, double-digit returns because of originally buying the note at such a steep discount. Read More >>
I have always been surprised by the lack of time investors, wholesalers and even real estate agents put into properly advertising an investment deal. They all invest an endless amount of time and money on contracting a deal, only to drop the ball on the advertising side. Many times you can take the numbers, CMAs, spreadsheets, etc. that are used to advertise a property and in a few minutes pick the deal apart. Maybe it is a lack of time or knowledge but unfortunately I feel most of the time it is an attempt to mislead or just make a paycheck. Sometimes the info looks so well put together and impressive that it might even slip by an experienced buyer. Therefore you must know your numbers.
If you are a wholesaler, investor and/or real estate agent you really need to know your numbers. There is not a day I do not receive a wannabe deal that looks good at first glance. However, once I take a closer look, it is as bad as the ones I just deleted. Let us start with the most obvious mistake, the numbers. So the very first thing I do is add the recommended repairs plus the asking price and divide it by the estimated after repair value (ARV). I like for this number to be between 70%- 75% loan to value (LTV). Nowadays, this number is 80%+ which is usually not worth the headache unless the property value is higher. But even then, I try to stay away from that high of a LTV. Heck sometime the property is marketed at one LTV when it is a completely different LTV. Read More >>
I have talked about this subject many times before but because of a recent call from one of my students I felt it important to talk about this subject again. A few days ago one of my students called and told me she was facing a dilemma and was worried about losing her property. She told me that she had no money to pay for the annual property insurance coming due and for two years of property taxes. She didn’t have the money to pay for either. This seems to be a common problem many beginning real estate investor’s experience. This is a subject I knew all too well because years earlier I experienced this very same problem.
I guess part of this problem stems from inexperience and lack of knowledge. Although this is a problem for many, it can be solved very easily with just a little effort and discipline. I felt it very important to write this article hoping to save many newer investors the distress and sleepless nights this problem can cause. Read More >>
Your Credibility Kit tells a story about who you are and what you can do for your seller or buyer in order to get a deal done. It will list the benefits to the sellers or buyers as to why they should work with you, a Real Estate Investor. The other main function of a Credibility Kit is to give you the confidence you need in order to create a win-win solution for you with your sellers. It should have all the tools you need in it to get you through the offer making process.
For example, in the back of my personal Credibility Kit, I have a list of different types of offers I can make on a property. This helps me when talking to the seller and keeps me from getting tongue-tied or forgetting a strategy that could just help out that particular seller. It also includes a cost analysis sheet which shows my sellers exactly how much it would cost them to sell their home in the traditional way and how much money I can save them at the closing table. My personal Credibility Kit gives my sellers all the facts they need to make a sound decision to sell their property to me. Read More >>
Some say the best real estate investors achieve the title and results through years of experience. I would have to agree, however in saying that I would also add that the experience these people have is only a part of their success equation in real estate.
The most important components I would suggest you have in investing are solid real estate comps from REIA Comps to work with, diligence and focus on a daily personal marketing plan. That marketing plan should be developed, directed, and in tune to the local property market.
Goal setting is the primary reason for business success. It goes without saying that a lack of proper planning is the number one reason for failure. Proper goal setting involves setting a business plan in place for your business goals. To many people this sounds tedious. On the contrary, goal setters have more time, freedom, more money, and more success in all areas of their lives than those who don't. Well, it's no different with real estate investing. Read More >>
Before you start entering data, make sure QuickBooks is set up appropriately for your company.
QuickBooks was designed to serve the needs of millions of small businesses. To do that, it had to include the tools and processes suitable for a wide variety of companies. But Intuit recognized that every organization is unique, so your copy of QuickBooks can be customized in ways that make it work best for you.
You could just dive in and start adding records and transactions. But we recommend you do some setup first. If you don’t, you may run into some issues later, such as finding that some features you need haven’t been turned on, for example, or that QuickBooks is simply not doing some things the way you do. The good news is that you can change many of these. Read More >>
“I did surveillance a lot, which sounds exciting, but it never was.” ~ Miranda Lambert
The Arlo Camera System is a favorite alternative to the Ring alarm system. It’s very easy to install since it takes literally 60 seconds to set up. It is a wireless system that can be synced up with your smartphone. If you have Alexa by Amazon, this can easily integrate into your existing Samsung family of appliances.
The pros of this system start with the ease of installation. The base plug looks similar to a router, so it is a familiar input, then turn it on. Place the batteries in the case and press the ‘sync’ button. That’s it.
The interface is very user-friendly too, I set up multiple cameras on a property and it was simple to rename cameras based on their location, like ‘garage’ or ‘back door’ and so on. From the app or the desktop website, you can relabel cameras, give preference like which camera is a priority first, adjust the motion sensor and record length once the sensor is tripped. The best thing, in my opinion, is that the camera will record once you open your notification, and it will record as long as you are watching the camera in real time. You can preset time lengths to record or do it manually from your mobile device. There are options for membership features, but the free subscription allows for 1GB of online storage and continuous weekly storage. Therefore, if in that seven-day span you have videos saved, the eighth day will delete the first video on the first day of that time span. This should be fine for most because it gives you the opportunity to select and save videos to a device or PC before the week resets. Read More >>
From as early as I can remember, the same obstacles have reappeared in my life, taunting me…never feeling satisfied, never feeling good enough, never getting ahead. Even the greatest opportunities one could ask for were sabotaged, and once again the chance to be happy slipped through my fingers. As words and teaching were given, I couldn’t see through the fog of my own delusions and as I yearned for change, I was trapped, imprisoned by shackles of my own creation.
This adversity brought me to the most important question I’ve come to ask.
This won’t be the standard real estate investing topic, in fact it may not have much to do with real estate. The topic emphasis is focused on you and I, and the choices we make in life that create pain and pleasure for ourselves. Read More >>
Going to the foreclosure auction was the best way to find real estate investing deals from 2009 through 2012…talk about lots of low-hanging fruit! We were often able to buy a nice three-bedroom, two-bath home in a solid neighborhood for $35 a square foot. Then in 2013, the cheese moved. Buying on the steps was no longer the best place to get deals.
Let me explain: In April 2012, there were close to two hundred properties advertised for foreclosure in Bartow County, but at the auction, there were only five investors bidding on them. It was like shooting fish in a barrel. One year later – April 2013 – there were less than eighty properties advertised with more than fifty – that’s 50 – investors and hedge funds bidding on that handful of properties. Suddenly, because of the law of supply and demand, winning bidders found themselves paying $80 to $110 a square foot for a house. This was a huge year-over-year price increase!
Did this mean that all the great deals had disappeared? No, it simply meant that to find great deals, investors had to look somewhere else – like buying properties pre-foreclosure. Read More >>
Looking for a great place to invest your Real Estate IRA dollars? Start right here in the Southeast. The 2017 Homeunion 2017 National Single Family Rental Research Report is out and Atlanta was named the #1 top city in its “Opportunity Ranking” metric for real estate investments in the single family home market. The number two city was Orlando, Florida.
The Opportunity Ranking indicates markets that provide a “strong balance of supply/demand fundamentals while offering favorable entry prices and limited threats,” said the study authors. The markets in this index were measured by a combination of cap rates and entry prices, as well as projected job growth in 2017.
Lots of construction activity counted against markets in this category because of the risk of overbuilding.
The remaining cities in the top ten for this metric were, in order, Seattle, Las Vegas, Chicago, San Diego, Oakland, Detroit, Dallas-Fort Worth and Memphis. Read More >>