To Buy or to Build?

When families, or individuals, first begin to think about purchasing a home, the question often arises as to whether they should buy a previously owned house, and then add a few personal touches, or whether they should hire a custom home building company to help them design their own. Every room will be the exact … Continue reading “To Buy or to Build?”

When families, or individuals, first begin to think about purchasing a home, the question often arises as to whether they should buy a previously owned house, and then add a few personal touches, or whether they should hire a custom home building company to help them design their own. Every room will be the exact size that the buyer wants or needs, buyers will be able to have an energy-efficient home, and the ability to personalize every space guarantees that custom homes will have more personality. On the other hand, most buyers will wind up with a brand new furnace if they purchase an older (cheaper) house in the long run anyway.

All in all, it boils down to whether buyers would like to spend a little bit more money when first buying a home for a brand new home that has been designed to meet their needs, or whether home owners would like to spend more money in the long run as renovations take place and things, like the furnace, need replaced. Taking the time and money to hire an experienced home builder can save families years’ worth of stress and hassle.

Mike Blake Homes is a well-known custom home builder with plenty of experience to guide you on your home building journey.

Power of Momentum

I watch every Bronco game, and the one thing that really stands out to me week after week is that momentum can often times win or lose a game. It is a good idea to reward yourself for your success, but do that and come back focused.

Sometimes it is hard to get the momentum in your favor because you are not sure what activities will get it going. Here are three sure fire steps to get momentum in your real estate business.

Set your goal

This needs to be a short term goal that is challenging but realistic. Here is an example of a statement that could be used to get a deal in the next thirty days:

“I got this house under contract that will net me $30,000 within a thirty day period by calling at least ten potential sellers every day from lists including, FSBOs, FRBOs and foreclosures.”

Once you have structured a quality statement print it out and put it in your car and one on the bathroom mirror. I want to be clear that maintaining is not the same as massive action and you will not be working as hard, but if you feel the momentum start to slip, I suggest starting the process over again. It is really amazing how easy success comes when you get momentum that you can build on.

What Will Conveyancing Cost You?

Conveyancing is a process that involves transfer of ownership of legal title of property from a person to another or from one entity to another. A conveyancer makes the process less tedious to sellers and buyers who may not know how to go about it and follow all legal requirements.

A conveyancer is a qualified and licensed professional responsible for providing advice and information on the property sale. The services of a conveyancer are important when selling or buying property, subdividing land, updating the title or when registering, removing or changing an easement.

When hired by a property buyer, the conveyancer will prepare, clarify and also lodge legal documents like memorandum or transfer and sale contract. They are usually from the best and reliable solicitors so you know that the decision you make will definitely be valuable.

When looking for best conveyancing services ensure that you will be assigned a solicitor who is not only qualified, but also experienced in handling the process and settling the deal to enjoy a smooth pleasant experience whether you are selling or buying property.

Friends and Partners

Another way to do it is to have defined roles and defined aspects of the business each is responsible for.

NO DEFINED ROLES: I did not get into this with them because of our limited time, but I sensed not much thought was put into it. One partner believes they are doing most of the work, or at least more than their share. It typically does not go well to explode on a business partner and friend.

Much of this is avoided with specific defined roles and penalties if things are not getting done.

NO GOOD REASON TO PARTNER: One of the gentlemen was a mortgage broker and one was a Realtor. In fact, I believe partners are essential to reaching your potential, but the reason to partner is to help you get something done you could not do without the partner. In their example, either one of them can get the skills the other is bringing without a partner. I don’t see a compelling reason to partner with someone to get skills I can get without the partnership. I see this with people wanting to partner with contractors a lot. Of course my response was, why don’t you use a partner? This is a prime example of when a partner makes a lot of sense. One partner might not have the knowledge and/or time to locate and rehab houses and the other cannot qualify for a loan. They both need each other.

One final thought is you might consider a joint venture on a deal by deal basis. I really like partners on individual deals where each partner is free to do other deals on their own as well.

Land Pooling Policy

Urbanization  has created many opportunities but at the same time posed certain challenges. How will Delhi Development Authority create infrastructure which fills up not only the existing deficit but also accommodates 80 lakh more people.

To save the situation from getting further aggrieved, a Master Plan 2021 is formed. The answer is NO and therefore DDA has come up with a land pooling policy, more popularly known as LPP.

LPP gives farmers an opportunity to come up with small parcels of land and get them assembled together for redevelopment purpose. Once the land is developed, 48-60% of the land is returned to the land owners. The policy has the potential of redeveloping low residential areas and propelling the vision of both MPD-2021 and Delhi Smart City.

The benefits of LPP are multiple:

The policy will put an end to the land acquisition policy which will further prevent the increase in land prices.

Long Term Real Estate Investors

This loan also comes with the lowest payment in the market helping you to maximize cash flow. I like the cash flow because it gives me control and I can choose where to invest it.

The disadvantage to a 30 year loan is that it takes 30 years to pay off the house, assuming you make the minimum payment. If you are a believer in paying off your rentals then a shorter term loan might be a better strategy and will give you the discipline to actually do it. Because interest rates are important to a lot of investors it is important to know you will get a much better rate with a shorter term loan.

My personal belief is that if you are leveraged on your properties you can buy more properties and more properties create more cash flow and more growth. However, if you are purchasing properties that cash flow AFTER vacancies and maintenance there really is not much of a down side.

As you can see I am not a fan of paying off your real estate when you are in your growth strategy period. If you purchase for cash flow, whether you choose to pay off the property or not, you won’t get hurt. If you cash flow and the house decreases in value, you keep it and enjoy the cash flow. Several new lines going in could of course increase the value of real estate, but that is speculation and if the market turns or the lines get delayed you could suffer.

In my opinion, if you are trying to grow your money quickly and are less concerned with the income, you should purchase as many properties as you can, especially those of you in Minnesota.

Difference Between Cash Flow and Profit?

WHY MILLIONAIRES GO BANKRUPT

“That is exactly why we cannot loan you the money you need,” I said in response to a potential client explaining to me that he has over $20,000 a month going through his account.

Cash is king. A lot of money going through your account does not matter. In fact, that is not a good thing unless the money into the account is more than the money out. I am sure you have heard the term, “you make money when you buy.” Although you make money when you buy, you can’t spend it until you sell. You will make more money and grow faster with leverage. Although I think you need to leverage people as much as money, I am going to focus on money for this point. If you have a lot of leverage in the way of loans, you need to make money to pay it off. I have access to cash if I run into a problem, and I use my assets to steadily pay off debt AND produce cash each and every month.

I prefer cash over equity in a home, but I am not necessarily saying don’t focus on paying off your mortgages.