REIT: The Next Big Thing In Real Estate

October 15, 2010 By

In real estate lingo, REIT means real-estate investment trust. It is composed of property-investment companies that pay dividends to stockholders with revenue derived from rent and other fees. REITs correspond negatively with the NASDAQ Composite Index and appear to do well when other stocks don’t. They suffered seriously during the late 1990s, but have made a successful comeback in the bear market that began 10 years ago.

In 1960, Congress launched REITs, offering small investors the chance to invest in profit-producing properties. Now, the REIT is popular in a lot of other countries aside from the United States including: Australia, Japan, and Brazil. REITs are not the sole real estate investment instruments available in these countries but all are dependent on the various laws in effect in each nation.

Due to the fact that REITs give the most direct means to purchasing property and avoiding costly hassles, they are very appealing to individual real estate investors. As long as they give out at least 90% of taxable income to investors annually, dividends from REITs are exempt from federal tax. Dividends can amass 8 to 9% per year and they offer predictability almost unheard of on today’s market.

Mutual funds have the same design as REIT’s and grant similar investment structure. They offer every shareholder a pro rata percentage of earnings. The stocks of many REITs are easily found on major stock exchanges. The subtraction of dividends from taxable corporate income is permitted with REITs. Capital gains and any taxes relating to dividends received must be reported by an individual investor.

In 2009, it was estimated that there were about 170 public REITs controlling in excess of $300 billion US dollars. The target of many of these trusts usually involves residential or commercial properties. There are some REITs that are concerned with handling the maintenance and management of the properties within their portfolios and there are also some who employ contractors to do these services.

View our web systems containing articles and information about real estate in Idaho Springs CO and Frederick CO real estate. Through these sites, you can learn more about Colorado cities, the real estate market, and even find home improvement tips.

Filed Under: Investing, Related News Tagged With: , , , , , , , , ,

How To Buy A Property – Tips On Inspecting Properties

October 9, 2010 By

The first thing you need to do is to avoid any big surprises if you might be taking into consideration a brand new real estate purchase, hence getting a specialized inspector for properties could reduce a lot of the unwanted surprises about your prospective residence early in the home buying process.

Always remember, though that you’re not necessary to conduct an actual home examination prior to the signing the preliminary contract, thus it is probably best to understand as much as possible about the condition of the property through an straightforward discussion with the seller and also performing your own ‘mini’ inspection by which you could check for standard structural defects or potential problems.

Many sellers will probably be open to having you check the house before you sign the preliminary contract, and this gives you a leveraging influence while bargaining the sales cost. The book ‘Smart Consumer’s Guide to Home Buying’ (Barron) really encourages all potential homebuyers to put together a checklist and note every problem and areas of concern before the contract signing. “If you are thinking about buying a house that will need renovation or upgrading, the more value will be derived from your mini-inspection,” explains the authors of the book.

Think about creating an inspection list for a property inspection survey in order to carry out a thorough of the property and also note down the appearance and overall condition of the said real estate. Here are some crucial areas to cover:

Find out about how old the home is – you will want to ask the seller specifically when the house was built, how many times the property has been renovated, and check if there are any architect or engineering plans on hand.

Check out the groundwork for potential problems – check for significant cracks or visible water conditions in the property or in the basement. Ask concerning flooding and issues that are weather-related which have taken their toll on the property in previous seasons.

Examine the interior for potential problems and other damages – you’ll have to make sure that the doorways are functioning properly and also that all the rooms’ walls and partitions are flat, even and free of cracks. Take note of anything that may have to be repaired immediately and make sure you also take pictures of potential problems that particularly needs repair. You’ll have to check for problems of odor or molds and ensure all water entry areas are crystal clear and working.

Check out the external details of the house for damages and potential problems – do all the doors and windows have sufficient insulation? Are they functioning well? Make sure the doors and windows don’t have breaks as well as any noticeable damages.

Review heaters and air conditioning appliances – inquire regarding the average cooling and/or heating costs over a year, and also find out how long it has been since the appliances were installed. Sometimes, you may need to get a new heat and air conditioning appliances.

Aside from the actual examination survey report, you may consider taking images and also short video clips with a digicam so you can go over the actual inspection in more detail at a later date. The extra footage might provide you an upper hand during the negotiation process with the sales agent.

About the Author: Alexandria P. Anderson is a Minnesota Real Estate agent that helps people to find and purchase Condos in Minnesota and other properties in the Twin Cities of Minneapolis and St. Paul.

Filed Under: Investing, Related News Tagged With: , , , , , , , , , , ,

Real Estate Investing For The Human Animal

September 6, 2010 By

Ever noticed how when you walk in to a book store and find your way to the business or financial books all the views that are expressed in the titles are almost the same??? Almost all of them,in one way or another, call out for a monetary version of bloodshed. I mean the titles are about how you can crush the other guy, or it’s not personal its business. Years ago when I got into the real estate investment game I spent hours looking thru the book titles. Trying to find the one book that would teach me how to become a “REAL ESTATE INVESTING GOD” That I knew I could become. After reading most of the popular books of the time I actually would feel beat up over the content. I mean did I have to be a “take no prisoners ” type of investor? Did I have to prey on some one else’s misfortune?? No, of course I dont. However I did need to learn to take somethings to heart and NEVER let go of them. I had to build my investment suit of armor so to say. So I set out to build a list of my investment rules. We each should have our own set of investment rules. It will help you keep the animal investor inside of you in check. In my case,being that I am a VERY competitive aggressive alpha male type personality I need rules that would keep me “Human”. My own set of personal laws that would keep me on the “non- predatory” path. Doc’s Rules for investing:

1) Set up some personal guidelines: Define and follow these guidelines. This is the most important rule I have. . Things to include, but not limit you to, are: Top dollar amount and lowest dollar amount. Type of investment you want to deal with. Period of term for investment.. Etc etc. (You can even have a guideline about the amount of time you will work per-day)

2) Remember some ones family is behind the deal you?re working on. Simply put,whoever you are dealing with has mouths to feed. Treat everyone with dignity and respect. If the price they are offering still falls within the personal investing guidelines you have set for yourself don’t use your position to abuse the seller. If you are getting the house for .40 cents on the dollar,don’t be a jerk and push for .30 cents. Always remember…it could be you in the sellers postion. (This rule DOES NOT come in to play when dealing with a bank owned property)

3) Always ask for what you want. No where does it say you can’t ask for something in an investment deal you like, I.E. if you’re looking at a piece of real estate with a pool,ask the seller if they would be willing to throw in new carpet to the sale. I once met a investor who was looking at a house that had been on the market for more than 6 months. When he went to talk to the seller he happen to see a 1954 Merc Coupe in the garage, so he asked if it was included in the deal. The deal eventually closed for the house AND the car. 4) Offer everyone the chance to make money as a bird dog for you. I always give several of my business cards to anyone I do business with and offer them a portion of any profit I make from any investments they help me locate. You would be amazed at how many people are willing to help you make money when they get a small part of it for doing very little work. (And if you follow rule #2 you will be amazed at how many of those bird dogs will sing your praises from the highest mountains)

These are just some ideas of things to keep in mind when you’re working on your investment mindset. These rules have worked well for me over the years,and in more cases then not, have gotten me more return and repeat networking opportunities then I can count.

Doc Schmyz has worked with investors all over the US. He built a free website shares Real estate investing information for all over the US. Find real estate information by state

Filed Under: Investing, Related News Tagged With: , , , , , , , ,

Getting A Home Inspection Prior To Buying A Investment Property

July 23, 2010 By

Most fixer uppers are homes that usually need a number of home repairs that generally do not require special knowledge or expertise on your part, as the homeowner. Fixer upper homes can be excellent bargains when the “asking price” is significantly lower than comparable homes nearby but in good or excellent condition.

Fixer uppers needing a cosmetic fix-up can be a great investment property. Most need some repainting outside and inside (paint can do a lot of wonders), floor refinishing or new carpets, some new lighting fixtures, little repairs, complete cleanup and landscaping.[I:http://homestyleteam.com/wp-content/uploads/DocSchmyz6.jpg]

If the home necessitates massive repairs such as electrical and plumbing problems that usually are expensive, it will slash your profit back or worst, eliminate it.

Before purchasing any house , a professional home inspection should be completed. The inspector can provide you an accurate idea of what existing problems the home has and what repairs are needed.

Here are frequently found fixer upper defects that might need your attention:

Roofing

Insulation

Plumbing system

Electrical system

Central heating

Central cooling

Water seepage

Structural (Most of these defects requires expensive repairs especially when talking about the value these repairs will return upon resale.)

Most often, major defects go unnoticed because fixer upper buyers usually can’t see the inside workings, hidden out of view or behind walls. When buying you a fixer upper you need to turn over a few stones.

A broken or damaged “heat-exchanger” in the heating system, faulty wiring, termite damage, lead accumulation, as well as asbestos insulation are common physical flaws that you can’t see immediately and need to be corrected before a re-sale.

Indications of these problems are as follows:

Moisture stains that can be found on ceiling and walls could mean plumbing problems.

Separations between wall and floor specifically for outer walls could mean structural problems.

Sawdust piles near woodwork or wall corners can be an indication of termites.

A home inspection from a professional

The average professional home inspections can cost about 200-325 dollars depending on the kind of property, square footage, etc.

When hiring a professional home inspection of fixer upper houses, it is wise that you obtain quotations first from several competing companies. However, the lowest bidder shouldn’t be immediately given the job; aside from the price, you must inspect the “quality of service” they offer as well as the company name. It is important to choose a company with a good reputation.

Several home inspection companies have some kind of computer-like machines which can supply inspection reports and descriptions instantly then the company adds their “pre-printed” sections which are very helpful for you in order to understand the fundamentals of repairing, fixing and replacement.

The most important part of a home inspection is that the inspector gives an entirely impartial appraisal and assessment of the house, inspecting everything carefully from electrical systems, plumbing to structural to make certain that the fixer upper house you are purchasing is sound.

Professional home inspectors can make certain that all major systems (air conditioning, plumbing, furnace) are working properly or they can pinpoint defects to you because these kinds of repairs will cost you a great deal of money.

However not all major repairing problems automatically indicate that you shouldn’t purchase the fixer upper home, because they can and should be added in the home’s price negotiations.

A good fixer upper seller or realtor will and can factor in said considerations or concerns and you possibly can purchase the home for even less if you put it clearly that you will be responsible for the repair or replacements. Just be careful that you don’t get tricked. Never take anybody’s word that the plumbing, the furnace or the electrical have no problems at all; you have to make certain.

Sometimes walking away from a “deal” is the best option. Perhaps it is due to location or a disagreement on price with the current owner. (Repair costs are almost always a sticking point)

In order to really make a good investment in a fixer…you need to find the hidden “information”. Most of the time a seller will not go out of the way to tell you. In some cases it isnt done out of spit…it might be information the current owner isn’t aware of themselves.

Doc Schmyz has invested all over the US. His free website shares Real estate investing information for all over the US. Findreal estate information by state

Filed Under: Investing, Phoenix Foreclosures Tagged With: , , , , , , , , , , ,