Buying A House Flip? How To Get A Good Deal! Have you ever been in a situation where you were looking at a house, noticed it was habitable but had a few problems, but was still close to purchasing the house and then changed your mind once you realized it was a “flipped” property? If you have ever had this happen to you then you know how frustrating it can be. Unfortunately, it happens more often than you might think. However, if you realize a house is being flipped and you are still interested in the property there are some things that you can look out for and do to ensure you’re still getting a good deal. Set Aside For Unforeseen Repairs If you are looking to buy a home that is being flipped you really should go by the 20% rule. For example, if you are paying $500,000 for a house that you think needs a lot of work, it would be wise for you to set aside an extra $100,000 for repairs on said house. Likewise, if you are paying a hundred thousand for a home, you should set aside about $20,000. Although it’s not always an automatic disqualification, be wary of for sale by owner situations. It really is better to go through a local real estate agent. Finally, on top of all this, you probably should give yourself a financial buffer. This is simply because it would be terrible to spend all of your money and then not have enough to pay the property taxes and other incidentals. Get To Know The Resale History You mainly want to know how often the home has been sold. Look for any quick sales with a significant uptick in price. Moreover, if the individual flipping the house is experienced, then they have a track record. Investigate other properties they have flipped and talk to the buyers. They will be able to tell you if the house they bought still needed a lot of repairs after they purchase. Better safe than sorry. There are a lot of unscrupulous house flippers who will sell a home to an unsuspecting buyer and only do the bare minimum to make it livable. Get To Know The House Up Close This is also a pretty reliable sign of a flipped house simply because a house flipper will want to unload the house as quickly as possible. Making it appear attractive is one way to do that. That’s the bad news. However, the good news is that there are some house flippers out there that will offer you a stipend to have the house remade the way you want it. Before making any agreements, it would be worth your while to fully understand the stipend and what it will buy and what it won’t buy. Determine What Changes Have Been Made You need to determine what the history of the house is, because it will be another…Details
2019 Real Estate Trends As 2018 comes to a close and a new year begins, the real estate industry experiences new trends. Some of the changes you’ll experience in 2019 are subtler than others such as Zillow making their move into Canada. Read on to learn the seven trends that will shape how each Realtor does business. There were many expectations for home buying in 2018, lets look at the 2019 predictions. The new trend in consumer shopping and home investment moves the most popular month to purchase to the fall, according to a study by the National Association of REALTORS. You’ll see residential home buyers make the first week of fall – September’s final week – into the week to close on a property. It not only becomes the time to buy a home, but the most popular time to begin a home search. That means the late summer months will become busier for those looking to sell a home. Local markets will still vary slightly, but nationally this applies. Early fall presents the best conditions for buyers. It has developed as a time of higher inventory, less competition and stable prices. Prices remain stable through November, according the three year data set used for the trend forecast. Home prices will increase early in the year due to low supply but high demand. This makes things tougher on first-time home buyers. The beginning of the year will present a tougher situation since the buyers will have snapped up all the affordable housing during the early fall. While it’s a seller’s market, seller’s haven’t wanted to sell. This trend continues into 2019, causing further shortages. Instead of selling, the owners offer the properties for rent and they’re making steady income as landlords. Millennials comprise the new leaders in real estate investment. The strong economy and their increasing incomes has encouraged their participation. Look for mortgage rates to rise in 2019, while homeowners will gain equity and have an easier time borrowing money. This makes acquiring funds for renovations or remodeling easier. Millennials aren’t the only ones experiencing the positives of a strong economy. There’s been steady employment growth throughout and positive economic indicators. These make it easier to get home loans. In 2019, construction starts will rise to meet demand. In 2018, single family housing starts increased by eight percent. This wasn’t enough to meet supply demand though. The coming year brings an increase, but it’s forecasted to be too small to fill demand. All trends beginning in 2018 and continuing into the following year combine to create a true seller’s market. We are still on the lookout for some technological real estate disruption for 2019. While demand exceeds supply, buyers have a much easier time acquiring loans than in the recent past. The youngest home buyers, millennials, experience an easier time due to positive economic indicators and increasing salaries. For those who can locate one in their price range, 2019 may very well become the year for…Details
Getting the Right Place at the Right Time It’s clear that buying a house is scary for a lot of people. It’s a big step in anyone’s life. For a lot of young people, it will feel like a passage into real adulthood, and they might not feel as if they’re ready for that anyway. For people who have been struggling for a while with their finances, buying a home will feel like ‘making it’ at last, which is exciting. However, it’s also very frightening. People might be worried about the risks associated with investing in a new property, and a home is always an investment in one way or another. This is one of the reasons why it makes so much sense to pay attention to the broader market and the associated trends. The real estate market does fluctuate quite a bit. It’s useful for people to try to get a sense of when they should purchase a house, especially if they have been trying to save up for a house for a long time. This will certainly be the case for many first time homebuyers in 2018, and even buying a second home in 2018 really does make a lot of sense. There are many objective reasons why buying a home in 2018 is a good idea, and people should look at all of their available options as soon as possible. For one thing, when people are deciding when it’s a good time to buy a home, they should always look at the average mortgage interest rates. In the case of 2018, these rates are unusually low. This means that people will already be able to start making much more steady mortgage payments than they would have ever imagined, and those mortgage payments will remain comparatively stable over time. The increasing interest rates will improve the affordability of homes, which is great news for home buyers. People also need to take into account the availability of good homes. There is no doubt about the fact that people will have a lot of options if they are looking for homes for sale today. All people need to know when they will find themselves in a buyer’s market, and that is certainly the case now. The demand for a new home is relatively low at present for a number of reasons. The fact that a lot of people are still worried about the state of the housing market has certainly contributed to that situation. Not as many people are buying homes in america. However, this gives the people who are buying a very distinct advantage. Anyone who is trying to sell a home in this market will have a tougher time, which is another reason why this is a good time for people to try to get a home personally. The supply of available houses will eventually go down again, The balance will shift again and the buyers will no longer be favored. As more and more buyers realize…Details
Should You Believe Everything That You Read on Real Estate Websites? When the time comes to buy or sell a home you will need to be armed with information – you will need to know what the mortgage rates are, which properties will give you the best value, which real estate agents are the best, which areas are best to invest in and so on. At first glance it may seem like getting this kind of information is easy – it is on lots and lots of websites. Unfortunately, many people who rely on information that they find online about real estate go wrong because they fail to take into account one thing – you cannot believe everything that you read. Consider the following scenarios. For a good example of quality, unbiased real estate market statistics we found you a good example HERE. The Choice of Real Estate Agent The choice of Realtor is an important one. You are in the market for a home in a certain neighbourhood, and when you go online you find a Realtor who describes himself as experienced, honest and who promises to get you the deal of your life. Are you sure that you can take his word for it? Are you sure that it is not a sales gimmick that is designed to snare you? You may even find the Realtor says that the real estate market in this neighborhood is the best – if you are buying he will tell you that you will be able to get something perfect for your budget, and if you are selling you can be sure that the Realtor will tell you that there is no better time to sell. HERE is an example of a Realors profile on Zillow. You forget to take into account the fact that the Realtor is a in business and their main aim is to make money out of every client that they deal with. Are you sure that you can trust them? Another common scenario is where you come across websites touting low mortgage rates – they will point you to certain lenders and promise you that you will get the most competitive rates – in fact, they will tell you that you will not do any better by going to any other lenders. Here is the question that you have to ask yourself – can you be sure that those sites do not belong to mortgage brokers? The bottom line is this When you are buying or selling your first home you need to get the best and most reliable real estate news and information, and you cannot believe every article that you come across. You should be looking for sources that are credible – true, everyone is in it for the money, but you need to find those who are willing to provide you with valuable information that will help you make the right decisions. In fact, honest Realtors will sometimes tell their clients that the time…Details
Buying a Second Home is Easier Than You Thought Buying a home is usually a roller coaster of emotions for many. Buying a second home takes home ownership to a new level. It is also an achievement by any standards. Buying a second home is just as exciting but it is usually a reserve of the few who are relatively rich and can afford such a lifestyle. That doesn’t have to be the case. Many people find it a challenge to move beyond the purchase of their personal home. Truth its, although there are some additional challenges, it still is achievable for most. Many existing homeowners, especially those who have been in their current home for many years and have equity, can take out a HELOC on their property to purchase the second one. Advantages of Owning a Second Home. A Home Away from Home A second home will allow you to have a home away from home where you can go to during vacations. It can act as a gathering place for you and your family to celebrate family traditions such as Thanksgiving and Christmas. Many people choose to purchase their second home in a popular travel destination so they can list it on AirBnB or otherwise easily rent it out for popular times of year. This can substantially reduce your overall cost of the property while still paying down the principle and earning equity. Financial Gains Even if you don’t choose to turn your second home into a money maker, if you bought the property right and the real estate market stays strong, you will build additional wealth. Over time, your home can appreciate in value particularly if you buy a house in an area that is likely to remain popular. One thing that many potential, second home buyers overlook is the ability to choose the city its in. Don’t be limited to your home town. Part of having a second home is that its a destination for you and your family. Buying a second home in an area chosen because of its strong financial outlook for the local real estate market is how billionaire real estate investors choose where to buy…why not you? Tax Benefits By no means are we acting as a tax professional, but for many, a second home can provide an added tax benefit by providing new deductions. When you buy a second home, you can get to enjoy five major tax benefits. These include: Mortgage interest Property taxes Home improvements Costs associated with renting out the house Tax free vacations In many instances,for the mortgage interest, you can write off up to 100% of the interest you are paying for a maximum of $1 million of the loan. You can also deduct the interest on your line of credit or home equity loan if your home requires some improvement. You can also deduct the property taxes of your second home which are calculated based on the value of the…Details
Buying a home in America today is anything buy easy. There is a ton of misinformation out there on the home buying process. Can someone say “Fake News”? Let’s take a look at the status of home buying in America, its profitability, ease of access and more. Buying a Home in America Although buying a home in America is not as easy as most people point it out to be, that doesn’t mean that its not a great idea and a solid long term strategy for acquiring wealth for you and your family. Lets face it, there are more millionaires made in real estate in America that in any other business field. That even takes in technology. Although the news may reference technology start ups that go public and talk about the twenty-something that started the business in his mother garage but is now worth 40 million dollars – those are unicorns. What we mean by unicorns are for every one of those fancy tech companies that “go viral” there are thousands that fail and go broke. Not the Case with Buying Real Estate It has been proven over and over again that homeowners have more wealth than renters. In addition to simply having more wealth, Americans that invest in real estate (whether it be your personal home or a true investment) tend to be successful. That is not to say that everyone that attempts to purchase an investment property and flip it (like on TV) walks away with $45,000 – but it is safe to say that there is a much higher percentage of success and profitability when buying real estate in America than any other investment strategy. Real Estate – More Solid an Investment than Stocks or Bonds Although the stock market has recently been at record highs, even the heaviest of millionaires that are currently invested in the stock market have MORE money tied up in real estate. The earnings that many of these savvy investors pull out of the market (when it retreats) generally goes into the purchase of residential or commercial real estate. Real estate has consistently beat the real estate market for consistent and overall growth for the last 30 years. What that means is if you put $50,000 in the market 40 years ago – and your neighbor invested $40,000 in the purchase of a home, your neighbors home would be worth more (less their initial investment) than you would have made in the stock market. Real Estate Values in America Lets look closely at the above example of the initial $40,000 investment. 40 years ago would have been in the area of the 1970s. In the 1970s the median price of a home in America (according to the US Census) was about $40,000. Yep, you could have purchased a home outright for a cool 40K. What do you think you could sell that home for today? In the year 2011 (once again looking at the US Census) the Average Home Value was…Details
If you are a Home Seller in America – your head must be spinning. Explore Real Estate News About Selling Your Home Selling Your Home Everywhere you look is someone else giving you different information on the best ways to get you home sold. You will also come across hundreds of different AVMs also called Automated Valuation Models. These are the computer algorithms that attempt to provide your home’s current value. Then, of course, you have the CMA (current market analysis) of what your home is worth, which was done manually by a real estate agent. Lets make it worse, say you have interviewed 5 Realtors to list your home for sale, each of them have most likely given you a different value on your home. Understanding the Bias When taking in all of the information about selling your home, its important to keep in mind the bias of where you are getting that information. For instance, some real estate agents may go as far as to tell you your home is worth much more than it really is. This is to get the listing agreement signed; when you don’t see the number of offers you expected, they then tell you that the home may be overpriced for the market. If you are using one of those “get your home’s value” things that are automated, its important to remember that the valuation from those types of products do not take into consideration much of the uniqueness of your home. If you have not had many properties recently sold around your house, those algorithms will struggle getting you a true value. Marketing Options for Your Home Another area of disparity when you are selling you home is the multitude of marketing options available to you. Depending on where you get your information, you may read that Home Staging is the #1 thing to get your home sold fast. You may come across an article that says how much more money you can sell you home for if you were to only use professional photos. If you speak to one Realtor, they will tell you that they are going to blast your property listing to thousands of the top real estate websites. Another says they are going to feature your home for sale in the local paper. Some will tell you that they will discount the commission you pay them while others claim that listing your home at an elevated commission attracts real estate agents to show your home. Truth is, there is NO silver bullet in selling your home. Let me take that back — there is a silver bullet…PRICE. If you want to sell your home in 24 hours, price it at 1/2 of the value. Wait…that doesn’t sound good to you? Then we better do A LOT of things right if you want to sell your home at a decent price in a relatively short period of time. So What Works?…Details
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