Archive for The Profit

Our government seems to be placing its bet on large-scale investment groups to help get the country out of the foreclosure mess.  In May the Federal Housing Finance Agency will announce who from among 3- or 400 investor groups will be allowed to compete for a stock of 2500 Fannie Mae/Freddie Mac properties in several major foreclosure markets.  A group of these properties are in the Atlanta area and will be sold in bulk to qualified investors.

The bigger investment groups will be able to put up millions of dollars in cash and will, more than likely, be able to drive the prices down below 70% LTV for these properties to be used as rentals.  Analysts speculate that these larger investors purchasing bulk REO deals from the GSEs or banks will be able to command 10-12% return on investment for holding these properties as rentals, well above the market return rates.

In major markets across the country large investment syndicates and hedge funds have entered into a feeding frenzy for bank-owned property sometimes driving the bidding up at auctions or in negotiations with lenders past a point where a small investor can compete. Read More→

The Owner Occupant

Posted on June 25, 2012 by

When contracting a property from an owner occupant you have to first find out how attached the seller is to the home. Discovering the reason the owner has decided to sell can help in determining the owner’s level of attachment. In most cases, contracting from an owner occupant is more complex because there are usually more emotions involved. For this reason, negotiations should be done in person. The bright side is you do not have to worry about competing with hundreds of buyers. Your competition is smaller thus your chance of contracting the property is higher. With that said, these types of properties take a bit more time to find.

Once you have discovered that an owner is selling because he/she can no longer afford the home, you can assume that the emotions and the attachment levels are high. This is where justifying your offer is very important. The seller is already being forced out of his home and now you, the investor, are looking to purchase it at a low price. Expect an immediate no, some explanation to why the home is worth so much more and/or some yelling. Remain calm! Listen to everything the seller has to say. Once he/she has finish speaking begin presenting your FACTS. Make sure the seller understands that your offer is based purely on factual information. Explain to him/her how you arrived at your offer. Make sure not to speak over the seller’s comprehension. In most cases the seller is not a savvy investor so make your explanation as simple and clear as possible. If you do a decent job the seller will see your point of view and realize your offer is not as terrible as he/she thought it was. Negotiation begins. Read More→

Hello, my name is Tony Pearl. I’m a successful veteran real estate investor who has done a lot of deals but got bored with it all a few years ago and started ‘playing around’ with marketing on the internet. 

Translation: When the crap hit the fan and real estate started sucking in 2008, I had to do something else to put food on the table, and I chose the internet.

It is my pleasure to bring you the ‘inside scoop’ on how things are progressing for me and other real estate investors who are successfully going online to get buyers, sellers, private lenders, and almost anyone or anything else you can think of to use in our businesses… and how you can do the same! That’s what this column, “Pearls of Wisdom,” is all about.

So unless you’ve been living like a cave man these past few years, you’re surely aware of how almost everybody is online now.  Think about this: Who do you know who DOESN’T have at least the minimum requirements of an email account or Facebook profile? It would probably take you a minute to come up with a name, am I right?  Exactly. Read More→

Doing Business in Deep Waters!

Posted on June 25, 2012 by

“Those who go down to the sea in ships, Who do business on great waters, They see the works of the Lord, And His wonders in the deep. For He commands and raises the stormy wind, Which lifts up the waves of the sea. They mount up to the heavens, They go down again to the depths; Their soul melts because of trouble. They reel to and fro, and stagger like a drunken man, And are at their wits’ end. Then they cry out to the Lord in their trouble, And He brings them out of their distresses. He calms the storm, So that its waves are still. Then they are glad because they are quiet; So He guides them to their desired haven. Oh, that men would give thanks to the Lord for His goodness, And for His wonderful works to the children of men!”
(Psalm 107:23-31)(NKJV)

As you may know, there are two ways of doing business; the safe and tested way doing business in shallow water, or on the other hand, the risky and challenging path of doing business in deep waters. Many business men and women chose the latter path. Often the outcomes of their decisions are difficult and trying. When this happens there is the nagging doubt of whether of not the right choices were made. Well, no matter, the real mission now is to learn how to navigate in deep waters.

Many think the trials and struggles successful men and women experience on their voyage to success are chance, bad choices, regrettable drawbacks, or limitations acquired or even inherited. These factors have an effect on the voyage, but some of these are fundamental challenges that are always going to be there. The passage from the book of Psalms outlines the principles of what a person can expect when their career and life choices push them into unknown territory or causes them to venture into uncharted waters. Read More→

“We should not only use the brains we have, but all that we can borrow.”
Thomas Woodrow Wilson

Home Builder Pro Calcs AppOne of the scariest things for new – and even experienced – investors is estimating the cost of repairs on a prospective investment property. If you’re off by even a little, it can cost you thousands in profits. If you’re off by a LOT, well, instead of walking away from the closing with a check for thousands, you might be bringing money to the table.

Finding a reliable contractor is a good first step. (Hint: go to your REIA meetings and network. Ask for recommendations. Interview several.) But the best way to know that you’ve got a good estimate is to become familiar with determining what repairs are needed and how much they cost.

So where do you start? One of the best apps I’ve seen to guide you through this process is the Home Builder Pro Calcs app. (At press time, this app costs $4.99 on the App Store and can be used on the iPhone and iPad.)  Read More→

How you monitor the condition of the property will influence your relationship with your tenant, how quickly you can turn the property when a tenant moves out, and the over-all income of the property. If you plan on holding a security deposit to be used for damages against a property, you must conduct a comprehensive move-in/move-out inspection.

This article addresses how communication, documentation and setting expectations with your tenants through scheduled inspections will result in a better landlord-tenant relationship, a better maintained property and avoid costly court cases, all of which effect the net income of rental property. Read More→

Ever wondered how millionaire investors find the most profitable deals? Satisfy your curiosity and save yourself time, effort, and loads of cash by consuming these five fundamentals that millionaire marketers use to gain massive wealth & prestige.

1. Don’t get caught up in the “BIG PICTURE”

Stay focused on your marketing.  One of the biggest mistakes professionals make is they start to believe that they’re only a doctor or lawyer or mechanic. They forget that their number-one responsibility is marketing.  Without marketing, there are no patients to see, clients to advise, or cars to work on.  Smart business owners know how to market their product or service and are successful at doing it.  You must constantly market your business if you wish to be successful.  Constant marketing of your business is how you find the best deals.

To begin marketing you must first identify all the various methods to market in your area, how much they cost, and whether they even work. Learning what methods not only work, but are most cost effective can cost you thousands and even hundreds of thousands of dollars through trial and error. Read More→

Tidal Wave Warning: Real Estate Investors Know the
Real Estate Market is Swelling with Opportunity!

Grab those Real Estate Investment Opportunities and
Get that Cash Flowing!

Cash Flow Real Estate in Your IRA? You Betcha!

The folks on TV talk a lot about the importance of funding your IRA – and they’re always on about investing in stocks, bonds and mutual funds. Some of the more conservative pundits also mention annuities and CDs. But what if you’re not thrilled with the prospects for return in any of these assets?

After all, interest rates are still near record lows all along the length of the yield curve, and bonds may well not even keep up with inflation. Stocks, as an asset class, are limited by a slow outlook for growth – and stock dividends are nowhere near what they were a generation ago. Mutual funds? Well, you can’t get blood out of a stone. Fund returns are limited by the opportunities in the asset classes from which they come.

One option that is less well-known is this: Investing in real estate within your IRA. The tax code doesn’t restrict you to stocks, bonds, annuities and CDs in your IRA or any other retirement fund. In fact, with just a few restrictions on investing in life insurance, jewelry, gemstones, collectibles and certain forms of precious metals, you can take advantage of tax deferral in an IRA to invest in almost anything you can imagine. Read More→

The Profit Has Arrived!

Posted on June 6, 2012 by

The Profit NewsletterThe Profit has finally arrived just in time for Atlanta REIA’s 2 year birthday celebration. That’s right, it has already been 2 years since we decided to start Atlanta REIA back in June 2010 and to hold our first meeting on July 5th, 2010.

Ever since we started Atlanta REIA, our mission has always been to help insure our members real estate success by providing affordable, quality real estate investing education, frequent, fun real estate networking opportunities and community outreach programs to build, renovate and repair homes for needy Atlanta families.  We’ve been able to achieve this mission through our meetings, special interest groups, networking events, seminars, webinars, workshops and our relationship with the Fuller Center of Atlanta.

Now we are working to bring you even more incredible member benefits and bigger discounts from suppliers such as Lowe’s, Sun Belt Tool Rentals, Sherwin Williams, Sears Commercial, Sprint /Nextel, Rent Fast, Build a Sign through our new relationship with the Community Buying Group; interactive, database driven websites with Super Smart; and our brand new newsletter, The Profit, which will be published and delivered each month about a week prior to our Atlanta REIA Main Monthly Meeting.

The purpose of The Profit is to help keep you and our members, guests, friends and followers updated on all the ups and downs of the real estate market; changing laws, rules and regulations; the latest real estate investing techniques, strategies and so much more! The Profit is also designed to keep you and other subscribers updated and informed of all the events and happenings going on at Atlanta REIA each month as well as exposing you to a wide variety of vendors and suppliers serving the real estate industry.

The Profit Newsletter

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  1. Russ HinerOvercoming Fear. When I first got started in the real estate business I had a tremendous amount of fear. There was the fear that prevented me from placing the ads, the fear that prevented me from making offers, and the fear that paralyzed me to the point that I was not able to move forward in a real estate investing career.
  2. Knowing The Numbers And Exit Strategies. After I made my first 50 offers I overcame that fear. After I got an agreement accepted I had the fear of not knowing what I was going to do with the property and whether or not it was going to be profitable. The exit strategy is the plan. The exit strategy defines what your profit is and how much profit there will be. Once I was able to get a handle on the exit strategies and refine the numbers my career started to take off. Read More→

Contracting

Posted on June 6, 2012 by

Michael VazquezFinding an investment deal today, although not easy, is not as difficult as it once was. When financing was easy to qualify for and no doc loans were offered by all, deals were harder to come by. Many people still believe that finding the deal is the hardest part of investing. I would have to say that finding the deal is less difficult than putting it under contract. Why? Well, by the time a contract is being discussed you know you want to contract the property and the seller knows he/she wants to sell. However, how much the seller will accept and what the buyer will pay rarely matches up.

Let’s look at the seller’s point of view. First, you must identify who the seller is and what is his/her interest in the property. There are many types of sellers but the most common seller is an owner that lives in the property, an owner that inherited the property, an owner that used the property as an investment, wholesaler, and REO agents. This is important to identify immediately because it determines how you should contract a property. More importantly it will let you know how to best present a contract to make it more attractive to each seller type. The one thing that all sellers have in common is that they expect you to justify your offer. As an investor you want the property as cheap as possible to make the most profit but making sure the contract is a win-win situation will make you more money in the long run. How? That seller will become your walking billboard and may bring you more properties! Read More→

Larry HarboltHave you noticed a declining number of people attending real estate meetings lately? Well, maybe not at Atlanta REIA Meetings, but this is true of many other REIAs across the country. I’ve run a weekly real estate meeting myself for over 10 years down in St Petersburg, FL and I’ve seen my own group attendance diminish from an average of 200 people each week to approximately 50 over the past couple of years. I realize many investors are confused, scared and have lost faith in the real estate investing business and who can blame them? You can’t open a newspaper or turn on the television without hearing anything but negative news about the real estate market. All we hear about is the declining sales prices, lower number of sales, almost no building starts and of course the record number of Foreclosures nationwide. Who can blame investors for shying away from buying houses in this market? Many investors are waiting for the market to bottom out before they are going to get back in the business. There is no better time to be buying houses than NOW, yet many investors are finding it impossible to fund their deals while other investors believe doing Short Sales is their only chance to make money today. This is not true! That kind of thinking is simply crazy! Read More→