Archive for the ‘property’ Category
All you Should Know Before Buying Commercial Real Estate.
March 24th, 2010 | 
Author: All you Should Know Before Buying Commercial Real Estate.
Buying or renting, such is the question many business people ask themselves around the 1st of the month, when comes the time to write their rent’s check.
With the interests rates being what they are and prices being affected by the commercial paper crisis, the answer might very well be yes if the right property becomes available and you can afford a relatively important cash down.
Owning commercial real estate does have it’s advantages.
Choices: as the owner, you can decide whether to select a building that matches your current needs, has enough room for future expansion or maybe is large enough for you to lease parts of it.
Equity: every month, your payments are applied to paying down your mortgage and building some equity which could be useful eventually to secure a loan for new equipment, to finance an acquisition or simply as an asset.
Appreciation: not withstanding any unforeseen occurrences, your building should appreciate with time. This appreciation could, just as the above mentioned equity, be used to get better financing conditions.
Power: as the landlord, you are the person in charge of deciding how to finance the building, picking the tenants, choosing the decorations, selecting entrepreneurs for the work to be done, improving the building. You even have control over your rent’s rate.
If it’s so great, why doesn’t everyone do it?
The main reason why not everyone owns the commercial space they’re using is that, in real life, thing don’t necessarily go exactly as in late night’s infomercials?
You can buy commercial real estate with no money down, especially if it’s because your money is bringing you more in another (safe) investment.
On the other hand, if it’s because your cash flow doesn’t allow you any flexibility and that you don’t have anything aside should things go a little unexpectedly, then you may want to seriously consider all the ramifications of the deal you are considering.
Your business’ cash flow’s growth stage.
Is your business bringing you comfortable and predictable income which you are looking to invest or would spending an important part of your income hinder any growth possibility for the near future ?
Will you be able to afford any substantial and sometimes unexpected expense should you have to do unexpected maintenance on your building?
Usually, a commercial property will require a 15 cash down which, in some cases, can end up being a lot of money.
Don’t forget you also have to factor in the price of insurances, taxes and legal fees. Due to the importance of the figures involved in most commercial real estate transactions, I recommend you surround yourself with adequate representation meaning: a real estate agent with experience and a positive track record as well as financial and legal advisers.
Examining the tax perspective.
Since I’m not a CPA and that all situations are unique, I strongly suggest you meet with a competent financial advisor who will help you evaluate your particular situation.
For now, keep in mind that in most situations, you will be able to use some of your expenses as depreciations to reduce your taxes or some of the rent as a personal income.
You make your money when you buy, not when you sell.
One last but extremely important factor to consider before making your decision is that you make your money when you buy but realize it when you sell.
Paying more than the fair market value, not taking into consideration your cash flow factors (mortgage, interest rates, insurance, taxes and repairs VS incoming rent, other income possibilities such as parking for example) or letting your feelings dictate a purchasing decision may negatively affect your exit strategy for year if you are not careful.
Though appreciation is quite probable, we suggest you don’t factor it in when crunching your numbers: if the deal is still a good deal without factoring in appreciation, you are likely to make a favorable ROI (return on investment) when you decide it’s time to go for your exit strategy.
If you absolutely need appreciation to justify your purchase, be extremely careful as no one really knows what will happen in the future and, in the present, you may be paying too much.
Discuss the situation with a real estate agent know for his or her integrity such as Anne-Marie Perno from www.Laurentides-St-Jerome-Tremblant-Immobilier.com
What you should remember.
So we looked briefly at the different aspects of buying a commercial property. Remember the advantages of being a landlord are:
? Choices
? Equity
? Appreciation
? Power
? Make sure you carefully evaluate your future cash flow.
? Purchasing the property won’t hinder your growth strategy.
? You can afford unexpected and sometimes quite expensive repairs should they be needed.
? You can afford the cash down.
? Get advice from a professional financial advisor about your tax situation.
? Get advice from a professional law adviser.
? Get advice from a professional real estate adviser.
? Avoid free advice as it often end up being the most expensive kind.
? Evaluate the building’s cash flow.
? Make sure the purchase makes sense even without appreciation.
? Find a reputable real estate specialist.
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Advantages In Joining A MLS Real Estate Listing
Advantages In Joining A MLS Real Estate Listing
When you choose to sell your home on your own, you want all the help you can get. Though you can save thousands by skipping the commissions of a realtor, you put yourself at a marketing disadvantage. That is why you need to get your property listed on the multiple listing service (MLS) for realtors. There are many advantages in joining a MLS real estate listing. A look at them will show you that paying a flat fee to get a ?for sale by owner? listing on MLS is well worth the money and effort.
The first of many advantages in joining a MLS real estate listing is that it is the key to sales success. Did you know that about four of every five home buyers get to the property they want through the MLS? By being listed on MLS, you will have most every real estate sales person in the region working for you. Most flat fee MLS listing services will keep you on for as long as 6 months, but in most cases you wont need that long with exposure to so many realtors, brokers, and customers.
The second of the advantages of joining a MLS real estate listing is that you are saving as much as 2%PRCTG% to 3%PRCTG% on yrou sale. Though that does not sound like a lot, it is actually %2000 per thousand you sell meaning you could end up saving as much as %20,000 or %30,000 on the sale if you skip the realtor and pay the flat fee to list on MLS.
Thirdly, one of the advantages in joining a MLS real estate listing is that you will be seen. If you are selling as a for sale by owner, then you have to hope someone ?accidentally? drives by your home or sees it in the newspaper by chance. Also, even if a realtor drives by, they will likely not show a home that is not MLS listed. If you are on MLS, though, you will come up in searches and have your house shown with much more frequency. It works much better when luck is taken out of the equation.
Finally, it is just good sales and business sense to list on MLS. Far and away, MLS is the best way to sell your property fast and for a price you like. Since the internet is considered the second best value and power versus reasonable cost for property, listing on MLS gives you the exposure you need.
There are many many advantages in joining a MLS real estate listing service. You will find that your home is better marketed, that you don?t have to rely on the luck of a drive by, that you save a great deal of money, and that you are linked in with thousands of realtors who essentially end up working for you. So if you are going to sell your home yourself, you should find a flat fee or free MLS listing service so that you have the best possible chance of selling your home quickly and at a price you want.
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Arizona Real Estate – A Perfect Place For Settlement
Arizona Real Estate – A Perfect Place For Settlement
Arizona, a large state in the Western United States, also known as Grand Canyon State, is famous for its astonishing landscapes, soaring mountain ranges, rivers, grasslands, forests and beautiful weather. Arizona valley constitutes of all these and makes it a perfect place for vacation, retirement, land investment or for permanent settlement.
Over the years, Arizona real estate has become the most sought after real estate in the United States. Real estate market of Arizona is huge and is one of the most commendable real estate markets in USA. The real estate in Arizona is full of luxury houses, apartments, buildings, beautiful decorated homes that draw attention not only from people of the United States but also from other countries.
For anyone planning some investment in the real estate market, Arizona real estate market is the ideal place to start. The state has witnessed record appreciation levels. Any sort of investments done in the commercial area, single-family home, rental apartment or retirement property, will be considered undoubtedly a perfect investment.
The state depicts its natural beauty through beautiful landscape, desert climes, pine covered high country and an abundance of topographical characteristics has made it a prime location in the eyes of the people seeking new homes or property. It?s a visitor?s paradise for vacations and has, over the years, become a hot spot tourist destination.
Arizona real estate market is soaring high with its increasing population contributed by the migrating populace from different states of USA. The people of Arizona are very friendly and cooperative in nature. The state has endless choices of entertainment and amusement, including parks, forests, rivers and a colorful Grand Canyon, which is one of the seven natural wonders of the world.
Arizona is also a well-known destination among retirees and is even more popular for the custom-built homes created around resorts, spas and other epicurean areas. Apart from that, there are plenty of first-class universities and colleges in Arizona. Phoenix, the capital of Arizona, comprises of incredible natural beauty. At Arizona, real estate and homes are available at an affordable rate and as per the needs of the people. The state is also famous for some popular sports arena where baseball is the major attraction for the tourists and other visitors. Baseball fanatics find this place really attractive and hence, an ideal place to live in.
Buying and selling real estate or property is not an easy task and there is always a certain amount of risk involved in it. Thorough study and extensive research are needed before investing in real estate or property. People want experienced knowledgeable agents who have maximum information about the area and can locate a real estate property as per their needs at a price below market standards. There are many real estate businesses that you can find online and some of them specialize only in Arizona Real Estate. It is advisable that if you are planning to do real estate transactions in Arizona always look for a specialist for that area. If you are taking the advice of any Arizona real estate specialist, your land transaction is definitely going to be smooth and profitable.
Arizona Real Estate
Arizona Real Estate
There is quite a bit of real estate available in Arizona, because new homes are being built constantly. If you?ve ever been to Arizona, you may be surprised by its vast open spaces ? and even the new developments that spring up don?t seem to take anything away from all of that wide open space. In fact, all of that beautiful space is what attracts many people to the Arizona real estate market!
Many people buy real estate from a distance, sight unseen. While this practice can be used to scam people out of their hard-earned money, if you follow certain guidelines you and your money should be relatively safe. Start by understanding what documents you should see throughout the sale process.
The first thing you should see is the MLS printout. MLS stands for Multiple Listing Service. The MLS printout is a copy of the listing that was sent out by the service. It contains a description of the property, and there may be statements made in the MLS that need to be verified for accuracy. If the property or home is in a new sub-division, you need to ask for the Public Report as well.
Other important documents that you should request include the Seller?s Property Disclosure Statement (SPDS), Covenants, Conditions, & Restrictions (CC&Rs), governing documents from the Home Owner?s Association, HOA Disclosures, the Title Report, the Home Warranty Policy, an Affidavit of Disclosure, Lead-Based Paint Disclosure, County Assessors Records, and a Professional Home Inspection Report. Make sure that you get a copy of all of these documents, for your own protection. It is a good idea to have your lawyer look at these documents as well.
There is quite a bit of information that you need to learn about a property in the state of Arizona before making a purchase. For instance, some places in the state may be infested with scorpions, which are quite common in Arizona and are hard to get rid of. Some areas of Arizona contain soil and groundwater that has been contaminated by improper disposal methods. All of this information can be found at the Arizona Department of Real
Estate (http://www.re.state.az.us/). You should use the various online maps that are available to stay away from less desirable properties.
Asset Protection for Real Estate Investors
Asset Protection for Real Estate Investors
The first 10 years of my real estate investing I ran my business as a sole proprietor because I really didn’t know any better. Luckily, I survived with only minimal damages, but there comes a point when it is time to assess the best legal structure to use for real estate investing.
If you ask 10 experts you are likely to get 10 different opinions. With that in mind, I’ll share my opinion and experience. Remember: free advice is always worth what you pay for it.
If you are a beginning investor, it’s probably best to not worry about asset protection until you actually have a few assets to protect. Why spend time and money setting up a business entity and creating tax reporting requirements unless you need to? It’s like buying full coverage auto insurance on a beat–up Gremlin…what’s the point?
Once you have assets and something to protect, then it’s time to set up your business structure. Question # 1: what is your net worth? Question # 2: do you have assets that are at risk? If the answer to either of those questions is, “Yes,” then you need to take the next step.
Assuming you want to set up an entity for wholesaling properties, the most popular are an LLC (Limited Liability Corporation) or a C Corporation. There is much debate about which one is better, but I prefer the C Corporation because the first %50,000 is taxed at 15%PRCTG% and you can have a kick-butt employee welfare plan to write off many expenses. With an LLC, the income is passed through. If you start making money, you’ll wish you could pay only 15%PRCTG% on some of it! Trust me on this one.
Why is the tax issue such a big deal?
Here’s a simplified example. If you make %100K personally you are taxed on the full amount (35%PRCTG%) and have %65,000 left. Anything you buy for yourself comes from after-tax dollars. However, with a C Corporation if you could make the same %100K on paper, but have %50K in allowable expenses that you can write off. So you get taxed on that %50K at 15%PRCTG% and only have to pay %7,500 in taxes compared to %35,000 on your personal income.
What type of expenses can you write off in a C Corporation? It depends on how your Company is structured (see your accountant/attorney for details), but you can often write off basic expenses of things like a bed or even a swimming pool. You’re thinking, “No way!” Let me explain how it’s done. If you have an employee welfare plan that covers your medical expenses and your doctor gives you a prescription for aqua therapy, it’s possible to write off the cost of the swimming pool. Yes, it’s crazy, but I don’t make the laws. Another more common example is a prescription for a new bed if you have a bad back. I have a “Sleep Number” bed myself, just like Paul Harvey J.
A very wealthy man once told me “It’s very hard for a C Corporation to make any money!” What he was trying to illustrate was that C Corporations can expense pretty much everything and look like there is little or no profit. You still can buy the same stuff, but you are taxed less if you structure things correctly.
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Assembling your Real Estate Investing Team
Assembling your Real Estate Investing Team
There are several important things you need to be successful in real estate investing, one of which is a great team. I’m going to talk briefly about who should be on the winning team:
1. Your Mentor – every successful entrepreneur needs a good mentor. A guide. By training under the watchful eye of one smarter then us, we can only get smarter. Start at your local investment club
2. Mortgage Broker – you want someone who has the experience of working with other investors. They need to be creative and smart!
3. Real Estate Attorney – it is really important to have someone on the team who can go through contracts, and who knows the legalities of all your moves.
4. Escrow Officer or Title Rep – having a good one on the team helps to close deals that much quicker. You always want people looking out for YOUR interests.
5. Accountant – Preferably a CPA (Certified Public Accountant). Your numbers guy should also be well aware of the ins and outs of real estate. Come tax time, this is the man to help you through the write-offs!
6. Insurance Agent – It is always better having an insurance rep that is looking out for you when things hit the fan.
7. Contractor – The good contractor seems like the hardest one to find, but can often make or break your profit margin. You want someone who gets things done on time and under budget!
8. Supportive Family & Friends – Having the support and backing of loved ones is important in any endeavor.
Other Optional Team Members:
9. Realtor – someone keeping an eye out for you
10. Property Manager – someone to watch over your investments
11. Great Handyman – Someone to take care of the little things that come up on a daily basis.
Assembling the team will not happen overnight, but once together, they will give you the backing and help you’ll need to make your real estate investing dreams come true.
Arizona Real Estate – A Good Buying Opportunity?
Arizona Real Estate – A Good Buying Opportunity?
If you’re looking to move to a new state, Arizona real estate is definitely worth a look. Following is a primer of the state and the FSBO Arizona real estate market.
Phoenix
Phoenix is by far the largest city in Arizona and it is growing fast. The sixth largest city in the United States, Phoenix is the official and economic capital of Arizona. The city is growing at such a high rate that it has engulfed the accompanying towns of Scottsdale and Tempe. Phoenix has a perpetual new feeling to it, which leads to criticisms that it has no inherent culture or roots.
If you want to attend sporting events, Phoenix has a nice selection. The city has professional baseball, basketball and football teams. Phoenix even has a professional ice hockey team, the Phoenix Coyotes. Only in America could a city in the middle of the desert have an NHL team!
If you’re looking for warm weather, Phoenix is the place. During the summer, average temperatures are usually above the 100 degree mark without much humidity to speak of. Evenings can get cool during the winter, but day time temperatures remain in the 70’s.
Flagstaff
Unlike Phoenix, Flagstaff is a town that reeks of the more historic Wild West. Sitting on the famous Route 66, Flagstaff is a college town because of Arizona State University. The University, better known as “ASU”, has over 30,000 students who more or less dominate Flagstaff. If you like the feel of a college town, skip Phoenix and consider Flagstaff for your real estate needs.
Arizona Real Estate
Arizona real estate is very reasonably priced compared to other states. The average home price in Phoenix is in the low %300,000s. Arizona has, however, become a hot real estate market with home values appreciating over 25%PRCTG% in the last 12 months.
Arizona is a take it or leave it state because of the heat index. If you prefer hot, sunny days, Arizona real estate may be a very good investment.
Alabama Real Estate – A Southern Air
Alabama Real Estate – A Southern Air
Alabama is undeniably a stereotypical southern state, but the state and real estate market hold undeniable surprises.
Alabama
Alabama is distinctly southern and darn proud of it. If you have a taste for college football, country music and NASCAR, Alabama is a paradise defined. To the surprise of many, Alabama also has a more modern flavor with Huntsville being the home of a major chunk of the U.S. Space Program. For golfers, the collection of golf courses winding through the state, known as the Robert Trent Jones golf trail, make Alabama one of the top golfing destinations in the continental United States. Personally, I prefer the annual iron bowl college football war between the Auburn and Alabama universities, but to each their own?
Huntsville
Home to the U.S. Space and Rocket Center, Huntsville is undoubtedly the pyrotechnic capital of the south. With a distinct southern charm, the city is laid out well with parks, botanical gardens, lake areas and a close proximately to numerous outdoor activities such as fishing, hiking and hunting. While many cities make a haberdash of mixing in the new with the old, Huntsville gets it just right.
Mobile
Pronounced ?Moe beel?, Mobile is a busy port city with a little known history. If you?ve ever thought of going to Mardi Gras in New Orleans, you?re better off going to Mobile. Yep, the city was the first to celebrate Mardi Gras in the United States and maintains the tradition to this day. In fact, Mobile looks striking like New Orleans, having been established by the French. It is a beautiful southern city, with spring being the best time as a bevy of flowing plants awaken from their winter slumber. The colors and fragrances are simply amazing.
Alabama Real Estate
Alabama real estate prices are very reasonable when compared to the rest of the country. Throughout the state, an average home will run you %200,000 or less. The appreciation rate is a little low, but still a respectable 7.5 percent for 2005.
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3 Tips to Staging the Outside of Your Home Like a Pro
3 Tips to Staging the Outside of Your Home Like a Pro
Are you considering putting your house up for sale, but not sure where to start? Afraid it will take too long to sell, or that you won?t get the price you want? Think about ?staging? your home, or in other words, setting the scene for immediate buyer interest in your property.
To be really effective, you need to look at both the outside and the inside of your home. Here are 3 tips to get you started with the outside of your home:
1. Go stand on the street to see what clients see when driving up to the house. Be aware that any negative impressions they get outside the house (landscaping not maintained or non-existent, peeling paint, etc.) is just going to make them think that the house itself has not been well taken care of. So even if you have spent the time and money to fix up the interior, it would all be wasted if the clients get a bad first impression as they drive up to the house.
2. Next, step outside your front door and close the door; then stand on the stoop and look around for 5 minutes. While the realtor fumbles for keys and tries to figure out how to open the door, the clients are standing behind and looking around. So what are they seeing? Dead plants, old Halloween decorations in the middle of January, cobwebs? Again, not a good first impression!
It?s definitely worth it to take some time and clean it up. Want to go a step further? Try a new coat of paint or some new furniture or accessories.
3. Don?t forget the backyard. While that might not be part of the potential buyers? first impression experience, you still should make sure it?s in the best condition possible. Pull up weeds, water plants, do some sweeping (if that?s applicable in your case) and maybe even purchase new furniture or accessories (plant pots, bird houses, etc.)
And the biggest tip of all? Imagine yourself as a potential buyer looking at your property for the very first time. What impressions are you getting? Would YOU buy your house? What would you like to see changed before you put an offer on your house?
And don?t worry about spending several thousand dollars to get your house ready to sell ? you?ll get it all back when your house sells. Proper staging helps you sell your house in a shorter time and at the price you want.
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Arranging the Finance for a Resale Property
Arranging the Finance for a Resale Property
Before you start to look for a property in France it is vital to know your budget. How much money do you have? How much are you prepared to borrow? Can you obtain a loan for the amount you require?
Different regions of France, and different parts of those regions, have varying prices for similar properties. Many local and national factors come into play in deciding the price of property across France, as in any country. Until you know your price range it is difficult to start searching for the area that suits you.
There are many UK banks and building societies that lend money on French property; there are also French banks that lend to foreign buyers or you may choose to raise the funds on your current property. You can search lenders out directly, use the services of a financial adviser or mortgage broker, or come to VEF for help and advice. It is important to be clear how you plan to raise the funds, the length of term, the interest rate, the type of mortgage, penalty clauses for early payment, the proof of income that will be required, the need for a medical and the length of time the mortgage will take to arrange.
At VEF we have researched the mortgage market for many years and continue to do so constantly to ensure that our clients get the very best service and the very best deals. There are constantly new financial products on offer and it is the job of our mortgage partners to be up to date with all the latest information. If you choose to use one of our partners, all your financial research will be done for you and you will receive written confirmation of the maximum amount of money you can borrow before you travel to France. Using one of the VEF approved brokers will save you time during the purchasing process. Good properties do sell quickly anywhere in the world, and France is no exception to this. You will be more likely to secure the house you want if you have organised your finances before going to France to view properties.