Atlanta Real Estate Investors Alliance Blog

“Knowledge is of two kinds. We know a subject ourselves, or we know where we can find information upon it.”  Samuel Johnson

This looks like a great place to invest. There are decent cars in the driveways. Lawns are mowed. Flowerbeds are neat. I feel safe. Houses don’t look too expensive and would probably cash flow. I wonder what that great little Cape Cod with the white picket fence is going for?”

Well, now there’s an iPhone app that can tell you that, and more.

Homesnap is a free app that you can use on your iPhone and iPad. Just snap a picture of the house and it’ll give you an estimate of the house’s sales price, tell you how many bedrooms and baths it has, its square footage and even what schools are associated with the house. And if you know me, you know that I really care what school district a house is in – because my tenants and buyers really care about schools, too. Read More→

“A man devoid of understanding shakes hands in a pledge,
And becomes surety for his friend.”
Proverbs 17:18

The biblical terms “shakes hands in a pledge” and “becomes surety” means that a person co-signs on someone else’s debt. In the business community, this also relates to a loan guarantor who has no collateral or control. Co-signing, simply put, is a risky and unwise personal and business practice.

This bible verse is a strong words against, what seems to be, an acceptable and routine practice in our society.  However, to imply that a person lacks understanding is an accurate assessment of the level of fiscal wisdom most people don’t exercise when it comes to co-signing. In light of the complexity of this subject, the next few articles will continue our exploration into the practice of guaranteeing someone else’s debt.

I believe it is fairly safe to say, many of us have asked someone to co-sign for us on a purchase at some point in our lives.  Or perhaps, you have been asked to co-sign for a family member or friend.  Maybe you were trying to help them establish their credit for the first time or help them recover from a financial meltdown.  The intentions, both ours and theirs, were probably noble and sincere.  Frankly in our culture, most people don’t think of co-signing as being something unwise to do or something to be avoided.  Read More→

Are You New to Self-Directed IRA Investing?

Many people are not sure if they have enough money in their IRA/401(k) account to even begin thinking about investing with it via a self-directed account. We have many clients who have taken accounts with small account balances and grown them into sizeable accounts simply by making one successful investment at a time. In this article, we will share the story of one of our clients, David G.’s 1^st self-directed Roth IRA investment. David G., by the way, grew his account from $6,800 to $293,000 in 5 short years.

David G. Decides on What His First Self-Directed Roth IRA Purchase Will Be

David G. was new to self-directed IRA investing and said “I wanted to ‘test the water’ with an easy first investment. Land was a good choice because it requires very little management.”

David G. Finds a Great First Purchase

David G. wasted no time in finding the land he wanted to purchase. He found an oversized, undeveloped, 1.87 acre residential lot. This lot had a low selling price of $18,900 (in comparison to its actual market value of $31,000). The lot really had a lot of value and appeal within it as it contained: water, sewer, a great view, and an additional upside potential to split the lot into 2 parcels. Read More→

Over the past five years, the real estate market took some now obvious twists and turns. In recent months, many local markets have made a noticeable shift into seller’s market conditions.  Fear of loss is new ingredient in the buying process, especially in popular markets, and, markets under $200,000, that have seen drastic shortages of acceptable homes for sale.  No longer are buyers looking at ALL of the available inventory before deciding to make an offer. In fact, many investors are making “blind” offers on properties that they have never seen before. Most investors participate in the under $200,000 market, of which over 70% of all sales in Atlanta are below $200,000  and this activity has caused medial sales prices to fall by 9.2% in 1Q 2012 (See Chart 1).  As many federal agencies give preference to owner occupants and non-profits, many days all available inventories for investors are SOLD OUT! Most properties under $100,000 are enjoying multiple offers, and, acceptable offers are usually well above list price. 

Chart 1

Read More→

When someone inherits a property there was either a will in place assigning the new owner or it went through probate. If the deceased left a will they could have either willed the property to a person or assigned an executor to their estate to do with the property and proceeds as the deceased wished. There are also properties that are inherited that went or must go through probate in order for the new owner to sell. When it comes to inherited property it can become very complicated.

When there is a will in place the new owner can do with the property as he/she wishes. Keep in mind that when a property is inherited someone passed away in order for them to become the new owner. This is always a touchy subject. When inquiring to purchase the property the tone in the seller’s voice will tell you how attached they are to the property. You will run into two extremes. The new owner wants nothing to do with the property because it reminds them too much of the deceased or they are having a hard time selling because it holds too much sentimental value. This also determines the price that they are willing to accept. You may be able to negotiate a better price with the earlier example opposed to the latter. If the new owner is under age to enter into a contract there guardian can sign for them but usually a judge is assigned to make sure it is a fair price. This is one of many examples where it can get a bit more involved. Read More→

Ok, let’s have a quick review from where we left off last time: In our last article, we covered how almost everyone is online these days.  Most people you know have email. They have Facebook. Some have Twitter and other ‘Flavors of the Week.’  In addition to that, more and more people are using their Smartphones (iPhones, Droids, Blackberrys, etc.) to get online.

Let’s face it: Traditional advertising media, such as the Yellow Pages, newspapers and the like are dying a slow death as the internet continues its surge in popularity and ease of use.  Quick test: When was the last time YOU used the Yellow Pages?  Can’t remember?  That’s what I thought. 

So now that we’re back up to speed, let’s get right to it.  I’ll start off by stating the obvious fact, for those who might be a little slow today:

If You’re in Business, You NEED to Have an Online Presence!

…Or you won’t be in business for long.  You need to have a website. We’ll cover what needs to be on it in a second.  Some other essentials you’ll need: Email. A simple contact form. And definitely a Fan Page on Facebook.  There’s more, but let’s start with those for now… Read More→

Landlords and Property Managers come in all shapes and sizes and we sometimes overlook great opportunities in commercial real estate because of the complexities.  A good relationship with a commercial property manager can help overcome those issues. With the current down market in commercial real estate you can find great opportunities to buy and hold. This should remain good for the buyers who have a good business and management plan in place. We are seeing a trend with current commercial property owners being forced to the sell their properties for much less than replacement cost values due to high vacancy and under preforming property income. One of the largest trends that investors will face in the future of commercial estate is the shift to our next generation of consumers and customers with their philosophy to live, work and play without the long commutes. The development of mix use commercial projects that include Multi-family and Condos, Hotel, office and retail should do well in the future of Georgia and Metro Atlanta.

The five areas of commercial are all shaping up with very different futures and I would list them from the projected best to the less preforming for Metro Atlanta and the Georgia Market. Read More→

I am often asked by women at events I speak at whether or not I think a woman can make a go of the real estate investing business on their own. My personal answer to this question is always a resounding-YES!

Actually, women have a distinct advantage over men in the real estate investing business. Sorry guys, it’s the truth! You see women are generally much more comfortable working with other women. That’s a given. So this makes the whole process go a lot more smoothly. And Men really like working with Women because it kind of levels the playing field. Women are seen as easier to work with. So Women end up doing really well in the real estate investing business even if they are working on their own.

Men are more comfortable working with a female investor for a lot of reasons. The first and most important is that there is no ego or testosterone coming into play in the negotiation process so generally a man and a woman working together are going to come up with a win-win solution much more quickly and easily than a man working with a man. It’s not like one of the guys “has to win”. Read More→

When a real estate investor or his attorney is filing for a Limited Liability Company (or any other business entity) with the Georgia Secretary of State’s office, it is pertinent to make sure that he or she acquires a federal Employer Information Number (EIN) from the IRS as well. Federal law requires federal taxpayer identification for income and employment taxation purposes. Furthermore, banks generally require an EIN to open any business account. For these and other reasons, business owners will benefit by applying for their EINs as early as possible in their business entity formation process.

Applying for an EIN can be a relatively simple process, but complications may arise where foreign persons or entities hold ownership interests in a company seeking an EIN. For example, IRS Form SS-4 requires applicants to name a “responsible party.” The responsible party can be held liable for any failure by the business to withhold and pay over income tax withholding or social security taxes. In the case that a business entity that is not publicly traded or registered with the Securities and Exchange Commission, the responsible party may be an individual, or if the owner of the entity being applied for is another disregarded entity for tax purposes, the responsible party can be this parent entity itself. Read More→