Dean Graziosi’s Real Estate

Expertise is so essential when it concerns purchasing property. Dean GraziosiCheck out on to learn some terrific recommendations about getting started in the field of real estate.

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Your credibility is vital to the success of utmost significance when you venture into realty financial investments. This makes you integrity with the area and assists you gain their loyalty.

Find similar individuals with similar minds and speak with them. There are a lot of individuals curious about property. There are most likely lots of groups creating in your area that focus on this type of thing. If you cannot discover one close by, you can find online forums online where other investors hang out. Go out there and see what your peers.

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There are to essential rules to making a financial investment in an industrial or commercial property market. You wish to see to it that you get a fair bargain on the land. Do not pay too much cash on business itself. You should settle on great numbers in order for you to make the property is something you’re interested in.

Be sure to select areas that are in a widely known location in which possible occupants might be interested. This is vital because it will make best use of the value that you get when selling. Try looking for properties that can easily be maintained.

Land that is situated near water or in the future.

Don’t spend your money in genuine estate with doing the field. Errors in investing can be incredibly costly.

It could well be unlawful for you to dig, and it pays to discover this out up front.

Do not get realty found in bad neighborhood. Know all there is to find out about the property before you purchase it. Do all of your research prior to you decide. A bargain on a good house could imply that it’s in a bad location. It may be tough to offer this kind of home and this sort of house can be vandalized easily.

Ensure you’re getting back your investment, plus an added profit.

Don’t permit your emergency situation reserve or cash fund. Investing in property requires a great deal of money that you can not get back immediately. Be specific that you can manage this without triggering financial pinch as an outcome.

Do not buy a property merely to increase the number of investments you hold. Investigate each home extensively before you invest and keep in mind quality over quantity. This will certainly help secure your financial investments.

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Work well and play will certainly with other real estate investors. This allows you to share resources and resources. You can find a great deal of potential and eventually pleased clients if you help one another. This is the secret to developing excellent will definitely help improve your track record.

Don’t invest in property if you don’t have a cash reserve. This reserve can be made use of for the remodellings that you do. Another factor for having money is simply in case you cannot lease the home swiftly. You still have to think of costs even when your property is unoccupied.

Ensure to have the home for needed repairs prior to making a purchase. Repairs require to be made before offering the house. Factor upkeep into your budget if you intend on leasing any piece of property.

These various legitimacies are going to vary from city to city so it assists to understand exactly what to anticipate ahead of time. Speak with regional officials to guarantee you stay within the law before you sign any contracts.

Avoid novices when looking for good real estate agents. You need to have a skilled expert if you’re going to discover the very best opportunities.

Be ready and willing to make sacrifices. You will certainly invest a bit of time in genuine estate investing. You might end up needing to quit much of your luxury costs in order to have adequate space to find success.

Avoid investment properties that are too costly or inexpensive. Buying homes too cheap is a waste of money on upgrades. Look for an affordable price home in suitable condition with fairly low maintenance.

You can be sure that you’re making excellent choices when you put in the time to study investments in property. Plainly, you have to make sensible choices and stay clear of investments that will certainly not pay off. Work gradually and regularly toward your goals, and you make sure to meet success.

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Weekly Video Blog #143 – The “Wonderful” Aftermath

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Could Your Home Sell to an Investor?

If you’ve been thinking of selling your home, or if you need to sell, there aren’t many markets out there crawling with buyers. The first time homebuyer market is still in the cellar. The Millennial Generation are still at home with parents for the most part. They’re not buying for multiple reasons, from sketchy graduate employment prospects to high student debt.

Existing home sale prices are improving. The FHFA (Federal Housing Finance Agency) report of home prices for November 2014 shows an increase nationally of 0.8% on a seasonally adjusted basis. However, sellers as a general rule across all markets are not enjoying high demand. The NAR (National Association of Realtors) report of existing home sales for the same period provides these data points:

• November’s sales declined by 6.1% from October, only slightly higher by 2.1% from the previous November.
• All regions tracked showed a decrease in the number of sales, though prices were up slightly.
• It takes approximately 65 days on average for a home to go from listing to contract, slower than the 56 days from the year before.

That’s kind of a mixed bag, and as far as DOM (Days on Market) an average number includes all of those “hot” markets with buyers competing and writing contracts in hours to a few days. There are a whole lot of sellers out there sitting on listed homes far longer than the average. Some markets are always slower, with DOM figures approaching six months or longer. So, if you need to sell your home, or want to and aren’t getting the job done, is it a candidate for a rental property investor?

No Discount — No Purchase

Don’t even think about it unless you can sell at a price at least 10% or more below its true market value. If you owe too much on it to do that, or you just don’t want to settle that low, then keep working the retail market. Savvy investors want to lock in some profit at the closing table.

The good news is that if you can do this, you could be selling very quickly. Investors are constantly monitoring their markets and looking for deals. Many of them pay others to deliver good deals. If the numbers work, they can often offer cash and a closing within 30 days. But, the numbers have to work.

The Numbers

Let’s do an overview of the things rental investors want in a property:
Rental demand — First and most important, the home should be one in an area renters want to live. It must also have some or all of the features they want, and they want pretty much the same thing as home buyers. So, if your home has a non-functional floor plan or antiquated appliances and other features, it’s a tough sell.
Cash flow — Most rental property investors use leverage. They will be using a mortgage, and they must be able to rent the home out for a positive profitable cash flow over their mortgage and expenses. Here is where you need to do some research. Check out the rentals in your market with similar features. Call like a renter, get real rent numbers. Then use a mortgage calculator at current rates and the discounted price at which you’ll sell to see if, taxes and insurance included (20% down), the home can rent out for at least a double-digit positive cash flow to cover other expenses with a profit.
Appreciation potential — Like any other homebuyer, a rental investor wants the asset to grow in value over time. Of course, you can’t predict the future, but you can see how your neighborhood has performed over time. If the area at least keeps up with the national average appreciation or exceeds it, you need to verify that with data.

None of these three research items require much time or effort. You can get data for recent property sales from a real estate agent to determine if you can sell at a discount to value. If your home meets the criteria, you could be a target for an investor. But, they need to know you’re out there. First, pull together your research so you can present it. No sales pitch is necessary, just reliable data they can verify.

Go to Market

This can be as simple as going on Craigslist and placing a free for sale ad targeting investor buyers. It’s different than a regular for sale ad. You want to put your research into a concise ad that will attract their attention with keywords like ‘rental home for sale, great cash flow property, discounted rental property, cash flow home at a discount,” etc.

Then just summarize your data, something like: “Great cash flow rental home for sale in high demand neighborhood with great value appreciation history. Buy at double-digit discount to value, with rental income potential that will generate approx. 20% return.”

The 20% number came from an example home that would rent out for a monthly payment around 24% higher than the mortgage, taxes and insurance, allowing for other expenses. If the numbers work, look for a call within hours to days, as investors or their birddogs are out there looking.
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Weekly Video Blog #121 – The Joy Of the Express Lane

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Top 5 Things Home Sellers Need to Know About Price

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The vast majority of homes sold in the U.S. are sold through local real estate MLS (Multiple Listing Service) systems. The member real estate brokers and agents list their properties and cooperate with other members in the sales through commission sharing. The typical seller will shop for a real estate company and agent, maybe interviewing several.

Every seller has their own priorities for that choice, but the most important common concern should be listing the home at the right price. Here are what I consider the top five things to understand about pricing your home to sell and not sit on the market.

#5 Value is Relative but there’s a Limit

You’re going to have your own ideas about what your home should sell for, but emotion only clouds the picture. It doesn’t matter how much you love your home, or how much money and sweat you’ve invested in it. There isn’t an absolute hard number though, as there are nuances in every market. Every potential buyer will have their own unique situation and a top price they’ll pay for your home. It’s a mistake to assume you’ll stumble into the perfect prospect who will fall in love with the home and pay over market.

There are fast, slow and balanced markets. Sellers can be more aggressive if buyers are competing in a low inventory situation. Your home may also have certain features that are in demand, such as a large open gourmet kitchen. But, if every home in the neighborhood does as well, then you lose the competitive advantage. The point is to work with the listing agent to thoroughly evaluate your home based on more than just what others have sold for recently.

#4 DOM Can Burn You

That’s Days-On-Market. Testing the market with a price higher than a careful valuation tells you it’s worth is risky. Sure, if it’s a healthy market you may get that just-right buyer the first week or so. But, if you don’t, buyers are checking out the number of days your home has been for sale and maybe adjusting their offers downward. Don’t assume that DOM doesn’t matter.

#3 Leave Room for Negotiations

Sure, we all know that it’s unlikely that we’ll get a full price offer right out of the gate. We expect some back-and-forth, and the listing price should have some room built into it for this bargaining process. But, too many sellers forget that there is another bargaining process after inspections. The perfect home doesn’t exist, and home inspections turn up condition issues and repair recommendations.

Minor stuff usually doesn’t result in a new round of negotiating, but buyers can be very demanding, especially if they paid near asking price. If you’ve been aggressive and held the line for a full price or near full price contract, expect some pushback if there are condition problems.

#2 Know How Your Agent Chose the Comparables

Real estate agents do a CMA, Comparative (Competitive) Market Analysis. They choose a number of homes similar to yours that have sold recently and use their selling prices to value your home in the current market. They adjust those sold prices to compensate for differences in the properties, such as number of bedrooms, etc.

Three very important things they consider in choosing those comparables (comps) are similarity to your home, when they sold and location. They should be using very recent sales, try to stay in the same neighborhood, and use homes as close to the same in features and size as yours. Ask your agent the reasons for choosing the comps they did, and how many possible choices there were. It may not be intentional, but in competing for a listing, an agent wants to give you a good list price estimate to get the listing. They can lean toward the comps with the highest sold prices, even if there were more qualified recent sales.

#1 Do it all Again

If your home doesn’t go under contract very quickly, how long is that original list price the right one for the market? It depends on the market, but in all of them homes are being added and sold almost daily. Supply and demand is the driver of prices, and supply can rise or fall quickly. Have a clear understanding with your agent that you want a report of market activity every couple of weeks. If home inventories change a lot, you’ll want to do another CMA.

Another thing that can make a big difference very quickly involves the type of homes and features. Inventory levels can stay pretty steady, but if three bedroom homes flood the market suddenly, yours may need a price adjustment.

Now you’re well-informed about price influences and the process. Keep these in mind for a better relationship with your agent and a smoother sale process.
Dean Graziosi