What Does Flipping Houses Mean?

June 1, 2012 by  
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To maximize your profit potential when buying a home, you may want to flip it. Flipping a home is a phrase that is used more often now in the real estate industry. Flipping a home occurs when a person takes over a house, remodels it with various strategic changes, and then turns around and sells the house for a potential profit. If you can purchase a property for a reduced value and fix it up prior to selling it, – you can make a pretty nice profit from it for a modest investment – and it is a great means of beginning your career as a real estate investor.

The house flipping process starts by locating a property that is below market value. Often these homes are called fixer uppers due to the initial work involved in bringing them into livable condition. This type of house can be readily found in any geographical real estate market. They could be a house for auction, a foreclosure, or a house that has been run down with little or no money put toward upgrading it through the years. These houses are prime properties for house flipping since they can usually be purchased for a reduced price.

Once you locate your target house to flip, you follow through with the offer to purchase as you would any other house. You will take care of the mortgage details and closing costs as you would normally and when doing so be sure you take possession of the property as a business and not as a sole individual owner. When the property close and you have possession of the place, you can either move in and begin the redesign and upgrade or live off property and fix the house as it sits. This latter method of flipping means you will need to pay attention to carrying costs that will eat into your profits so a fast flip is conducive to making a profit and listing at a higher price.

House flipping is an art unto itself and not everyone is cut out for the challenge. If you are handy with tools and have renovating experience you will be a good house flipping candidate. You can also hire professional contractors but again your profits will be reduced because of labor costs. You can make a decent living by simply house flipping a few properties each year. You should enlist the aid of a competent realtor with excellent market knowledge and the ability to lead you to good properties with house flipping potential.


House flipping is a wonderful way to make a great deal of money in the real estate game. Potential house flippers would be wise to enlist the help of property inspection experts to aid in the first few flips so you can minimize your chances of buying a property with expensive hidden damage since this can kill any profits quickly. If you like taking a risk for a reward, house flipping may be just right for you.

The Importance of a Home Building Plan

May 29, 2012 by  
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Your home is not some abode that you hang your hat in or a place to stay dry when it rains. Your house puts your entire lifestyle and personality on display for the world. The thing is; your home has also become the largest investment in your life to this point – and perhaps for all time. Many people spend any future investment capital on their home – and plenty of it as a source of keeping their investment viable over time.

Building a home as an investment is fine and you will need a building plan for your new home. Prior to that discussion though, let us talk about what that home building plan really is. Sure, it’s something you need to construct the actual building, it is also an opportunity to pick and choose exactly what you want to have in your home and place it exactly where you want it. It can also be complicated so working with a professional home designer is recommended, but these days there are software programs available so you can have some fun experimenting with these. Just remember that this a time when you should let your imagination run wild – you can rein it in later.

Start with making a list of the things you definitely want in your new home building plan and these need to be part of regardless of the cost. You could also devise a list of those things you do not want. This aids in keeping both spouses on track and the same page. You also need to ask yourself if you are planning to sell the home at some time in the future. If the answer is yes, your home building plan should reflect that by having features built in that are popular for the majority of homebuyers.

Do not be afraid to add energy efficiency into your home building plan, for example making sure you have top grade insulation throughout, high energy heating and cooling and use building materials that promote energy savings. Will your home be a one story or a two-story home – obviously these needs to be outlined in your home building plan? How many rooms are you going to have in your new home? What about the number of bathrooms and the size of each? Once you have these questions answered you will be able to begin calculating square footage costs to determine costs and pare away what you cannot afford – there is no rush for firm numbers at this time.

Assuming you still need to purchase a lot for your new home, you need to consider the location you desire and its affordability. Once you determine where you want to live, your home building plan should be designed to fit suitably in that area. Many developers have regulations and standards in place that maintain the “look” of a neighborhood as it develops. This could also determine how unique your home building plan will be. Even if your choice of home building plan is acceptable, it should be attractive to the masses and be easy to turnover in the event of a forced sale in the future so keep it buyer friendly.

Prior to starting your home building plan, you should familiarize yourself with home designs and basic construction so drive through new areas and attend a few open houses of brand new home for ideas. Also buy some design magazines and troll the Internet for design ideas and home building plans – there are literally thousands of them online. There are also many cool online tools available to assist with your home building plan and as I mentioned earlier, some software programs available to aid in your home building plan design.

Your new home will reflect your personality and that of your family. You want to take your time and design something you can feel great about for years to come. Your home building plan is where it all begins so focus your attention to this important aspect of a new custom home purchase.

Your Questions About Real Estate

October 24, 2011 by  
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Nancy asks…

can a person take the real estate exam without going to real estate school?

I’m interested in the real estate career but to shortened the question: Can I just take the real estate exam without going to school.

The Expert answers:

You can take online classes. I am in California and you have to have 3 classes from an accredited school in order to be a real estate agent. Once you’ve completed those classes, you can take the exam.

Linda asks…

what is the best real estate school in Michigan?

what is the best real estate school for a business student in michigan (metro detroit area) ?
(not really interested in online courses)
not planning on becoming an agent. just to build resume and have real estate knowledge to go along with a future MBA.

The Expert answers:

My experience is that real estate school is only good for helping you pass the test and getting your license. When you get your license you should work with some experienced and successful agents and learn from them how you can be successful.

So when you are judging “the best school” just look at what percentage of their graduates pass the test, at least I think nothing else matters because they don’t seem to be able to actually teach how to be successful.
********************
Every real estate school I know is structured for people trying to pass the test. So if you want real estate knowledge for other purposes- I would decide exactly what you want to know and find a business school at a full university that teaches that particular thing. There are a lot of different areas that fall under the umbrella of “real estate”. For example look at the wide variety of questions in this category.

Charles asks…

Do you have a GED or Highschool diploma to go to real estate school?

I would like to become a real estate agent and Im working on my GED. Im planning on paying over 200 dollars to go to school and 1200 dollars for licenseing. I want to know if you MUST HAVE it to go.

The Expert answers:

Generally, the only rule for admission is that you must meet your state’s licensing eligibility requirements. Many states DO require that you have a GED or high school diploma, so check your state’s requirements here:

http://www.mortgagenewsdaily.com/real_estate_license/

Maria asks…

Anyone know a good real estate school in vegas?

I am trying to get my real estate silence, can someone please tell me which is a good school to get your silence in vegas? I am trying to find a school where you can get taught by experienced people not just online courses.

The Expert answers:

Don’t do it. Run!! Come back in 10 years…

Laura asks…

What is the best california real estate school?

I’m trying to get my California real estate license and am choosing a “school” to enroll for classes. There are so many that make big promises.. realestateexpress allied, lumbleu etc.

Has anyone tried any of these and if so can you tell me what you think of them? I’m especially interested in Lumbleu because it uses a different technique of video teachings. I would prefer to study from a text book rather than online..

Any help is greatly appreciated!!

The Expert answers:

Duane Gomer’s California Real Estate School

The quickest, very affordable, and a very high pass rate.

Also take their RE test review class.

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Your Questions About Real Estate

October 15, 2011 by  
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Betty asks…

Anyone know of private money sources for real estate investors in Houston? Not Hard money.?

The Expert answers:

The only suggestions I can make:
A] Prepare a business plan – on paper.
1] Join a real estate investment group, BE ACTIVE and share your thoughts and ideas with the other members of the group.
I’m not saying the only ones you might impress will be hard-money lenders, but its worth a try, isn’t it?

2] Gather your friends and relatives to an afternoon party and discuss your thoughts and ideas with them. This also includes the members of your church/temple/mosque.

Thanks for asking your Q! I enjoyed answering it!

VTY,
Ron Berue
Yes, that is my real last name!

David asks…

How to find home sale prices in Houston?

In places I’ve lived before, Florida and Ohio, a real estate‘s sale price and sold date is public info and available on the county’s property appraiser’s website. The Harris county (i.e. Houston) appraiser’s website doesn’t show this info. I’m a real estate investor and need to get comps before I make offers on properties. I prefer not to go to a realtor yet. How can I get sale prices of homes and sold date in Houston without going to a realtor?

The Expert answers:

The reason we don’t disclose to the state government how much we paid for a property is because we have not trusted our state government ever. We think that they will use that information to tax real estate transactions.

We also don’t want them to have that information to use to up our property tax values- but they have found ways around that.

Daniel asks…

Does Robert allens real estate investment scheme of no money down work?

I would like to hear from professionals as well as amateurs in the field of real estate who have tried his techniques. Does his website which promises to give pre foreclosure listings nationwide actually work. In a free seminar i attended, they said, there would be atleast 9000 listings for the houston area. Also the personal advisors will look up the MLS for any property and will advise us of the fair market value of the property. Also that there are plenty of private investors who will lend atleast 80 % of the FMV of the property, not the purchasing price as banks and other lenders do. I wonder how much is true and how much is hype. Would like to hear from those who have tried his methods and signed up for his programme

The Expert answers:

While I have not used Rober Allen’s system per se, I have bought real estate with a lender giving me money based on the vaule rather than the purchase price. They are hard to find but they do exist.

As for foreclosures, I would think 900 in the Houston area sounds about right. They are probably using a CRS or similar system. Basically, it taps into the county data and finds comparable sales. I know locally, I have the ability to suscribe for a couple hundred bucks. People I know that suscribe swear by it.

I’m sure Robert is willing to do this because he gets a cut of some kind…and he’s making money from other people doing all the legwork.

I would think it’s legit. If the fees are crazy though, I would suggest you join the local real estate investor’s club and do it yourself.

You could also try calling the various banks and asking for the REO (real estate owned) department. Some will act confused and not know what you are talking about but all banks have them.

When you get the department, ask if they can provide a list of their REO properties and go from there.

Susan asks…

How can I find an investor for my fashion line that is willing to pay for everything?

My name is David Davis, Jr. and I am starting my own fashion line. I would like to know where can I find investors that would help me with funding for the startup. I need commercial real estate technology resources, money for manufacturing and much more. My business plan is ready for an investor. My entire plan is ready for an investor. I live in Houston, Texas. However, I would need an investor from a pretty reputable source. Anybody I am prepared for business.

The Expert answers:

Talk to venture capitalists. It’s a long, tedious process that’s basically the social equivalent of turning people upside down and shaking them so the change falls out of their pockets. The chances that you’ll find one person willing to put up all the money is very low, especially if this is your first business, so talk to as many people as you can and ask them to refer you to others who might be interested. When someone turns you down, ask them why or if there’s anything you could do to change your mind. Almost no one is lucky right away, so just keep chugging away if you really want it.

Thomas asks…

Are you an investor looking for TX properties in DFW or Houston 80% LTV?

We are a real estate company that deals100% on selling new homes. Builders have many homes with deep discounts that are not advertised. We are one of the few companies that sales reps. share information freely with.

The Expert answers:

If you are only selling homes why do you care about the LTV of buyers?

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The Wrong Side Of The Tracks

December 13, 2009 by  
Filed under Real Estate Tips

Most of us have heard someone – often our parents, but probably more often a character in a TV show – describing another individual as being “from the wrong side of the tracks”. It is one we hear, and repeat, without necessarily giving any thought to what it means. We as humans, have a tendency to do that – but what does it mean?

Well, to make a long story short, it was realised some time ago that people who could afford to choose where they lived would pay for a house in a location that was peaceful, clean and sedate. Too much through traffic means a lot of pollution, and can also cause structural faults, and also an increased number of strangers – something we were always taught to dread.

Poorer neighborhoods, with higher crime rates and naturally a “less desirable” kind of person living there, as a result, were often positioned close to public transport links such as railways and (in larger cities) airports. Anyone living in that area would be considered bad news by the richer families who intended to maintain a spotless reputation – and if the son or daughter of a rich was seen to be consorting with someone from those areas, that could mean social suicide.

This kind of reputation still persists for many people. However, there are also advantages to living and buying in what might be considered a poorer, grottier neighborhood. Prices are lower, but sound investment does mean that you can still make a decent profit. After all, proximity to public transport links also has its benefits.

Location, Location, Location!

December 13, 2009 by  
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There is a common mantra among real estate professionals and investors which is simply the word “location” repeated three times. The thinking behind this is that, when it comes to making money in the world of real estate, the most important thing is where the property is located. The second most important thing is, also, where the property is located. This is also the third most important thing. Essentially, location is important when it comes to making a success of real estate investments.

Of course, most people already know that, so why does the business make such a big fuss about location? It’s like making a big issue out of breathing, isn’t it? Well, not quite, because many people do not realize just how important location is, how fine the margins are and how big the difference can be between two houses which are in plain sight of one another. It’s not just about what town the house is in, it’s about what street, the exact position within that street, and what you can see from there.

It may be tempting when listening to a friend talking about the great deal they got on a house in a certain area, to think “well, I know for a fact that there is another one up for sale there – I can buy it for that price and raise a significant profit”. This may not actually be the case, however. The position of a solitary tree, church tower or bend in the road can have a pronounced effect on what you can expect to pay and what you can expect to receive for any real estate – so do your homework.

You Can Do It Right, Or Cheap, Or Quickly…

December 13, 2009 by  
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The importance of turning a maximum profit in a minimum time frame is as important in real estate as it is in just about any other sector of the business world. And of course, when you create a profit margin this makes for three immediate variables. How quickly can you do something, how much must you spend and how few mistakes can you make while doing it?

The introduction of these variable factors can make it very difficult to carry out the perfect real estate development. If you are keen to get the job done quickly, you will face the challenge of avoiding paying through the nose while trying to ensure that the job is still done correctly. Decide that price is your priority, and you will still want the work done as well as possible, but you don’t want it to take forever. And if your major priority is a good job, you will have to consider how you will get that done on time and within a budget.

In trying to make sure that each of these priorities is served, you will find yourself with some judgement calls to make. On some issues you will not be able to satisfy the need to do something cheaply and quickly and well – so what do you sacrifice? Sometimes the circumstances will go some way to making the decision for you. In order to make sure that you can live with the decision, you need to be firm in making it. Too much procrastination will simply narrow down your options, so be prepared to make tough choices if you want to make a success of your development.

Spreading Your Wings – Buying Real Estate Overseas

December 13, 2009 by  
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For the ambitious real estate investor, one of the most interesting ventures can be the purchase of an overseas property. There are many of us who would like to one day retire overseas, and even quite a few of us who would like to move abroad while we are still some way away from retiring. If we are adaptable individuals, perhaps with one or two foreign languages in our lexicon, we can often find that the challenge of living and doing business overseas can be an enjoyable one.

Of course, for those of us used to doing business predominantly in a domestic setting, the practice of buying a house abroad can often be wildly different to the idea. Depending on where you plan to buy there may be restrictions on foreign nationals buying or owning property. You may have to pay larger taxes, and you may face different and sometimes strange rules regarding exactly what you can develop, where you can develop, and how you do it. For this reason it is essential to do your research.

Overseas real estate is a tricky way to make money, because you will need to commit a large amount of your time to being present on site. Many people try to avoid too much time spent away by appointing a project manager, but to paraphrase an old saying: “Who manages the project manager?”. If you want to guarantee a profit, you will have to take an interested involvement in the development, and if you are planning to lease the property to tenants you will need either to employ a trustworthy individual or move – temporarily or otherwise – to the country in question.

Knowing When To Cut Your Losses

December 13, 2009 by  
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Buying and selling real estate is one way to guarantee an interesting business career – but it is not without its drawbacks. One of those drawbacks, the significant risk factor, is part of what makes it interesting. But if you can play the game well, you need never become one of the many people who falls under the intense pressure of trying to turn a profit. Sometimes, real estate is as much about trying to find the smallest loss on a deal when the avenues of profit and breaking even are closed off to you.

Whenever you buy a property with the intention of increasing its resale value, you do it with some amount of optimism. The mere thought of “If I can get this work done, source the materials and get it to market on time and on budget, then I will make a profit”, leaves open three ways that things can go wrong. Maybe the work will not get done as well or as quickly as you had hoped. Maybe the materials will prove harder to source than you had planned for, and as for the schedule … well, unforeseen circumstances make fools of us all.

The fact is that sometimes, despite your best efforts, you will see your intended profit begin to shrink – and sometimes, it will disappear altogether. It is at this point that you will be tempted to bring everything to a sharp conclusion and just sell for whatever someone will give you. This is a big mistake. If you hold on and set a new, realistic deadline and price you can at least cut your losses, and maybe live to develop again.

Commercial Real Estate – How It Changes Things

December 13, 2009 by  
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Buying real estate is always loaded with questions and variables, and it takes a confident and decisive individual to get it right and make a profit. It can be an even more vexed question for those who are looking to buy commercial real estate. When you are buying and selling a house, the important issue is that you do enough to the property in order to turn a one-time profit. Buying a commercial property is another issue entirely, as you need to ensure a lifelong commercial viability.

It is safe to assume that people who buy commercial property are more likely to be in the deal for the long haul than are people who buy residential real estate. It is not always the case, but it usually is. Therefore, there are different things that you need to be aware of when buying a commercial building. The first of these is where it is located. Ideally, you want somewhere with good commercial outlets nearby. If you invest wisely in a well-located commercial property you can guarantee good profits simply by virtue of “walk-by” business.

Commercial real estate has taken something of a hit in recent years due to the feasibility of running a business from home. Now that people can run a company from their computer with minimal start-up costs, people are choosing to do so in favor of paying the often high costs of getting set up with “premises”. There are businesses, though, which will always need a physical edifice – such as restaurants and garages. Owning a commercial property near to one of these, their workforces and their customers, can pay off in a big way

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