Real Estate Tips to Find the Perfect Neighborhood

Once you are eligible for a loan, you can start searching for a house and you should not skip scouting out neighborhoods before you start your search. You should carefully choose your neighborhood because it will create a great impact on your life every day.


One way to explore your area is to get in your car and roam around. You will get an idea about the area and you can even walk around and get more information from the residents. If you have children, you need to look for a neighborhood with plenty of children and parks, schools, restaurants, hospitals nearby. You should also consider the crime, family needs and the value of home in the future.


School district

Buying a house in an area with good schools is definitely a very good investment because you can sell it for a good price at some point in the future. Neighborhoods with good schools are more likely to attract buyers who have kids.


Crime statistics

Try to find the crime statistics of your area. You can even search on the web about the crime and other information about a particular area.


Consider your family

Apart from considering the number of bedrooms and an attached garage on the house, you should also consider the community nearby. Check if you have schools in walking distance? Is your workplace close to the house? Is it close to shopping malls, restaurants and hospitals? You should also research about how well the value of the property will increase in the near future.

Rental Properties in Real Estate Investments

This is an old practice of real estate investment. A person will buy the property and rent it to someone. All the mortgage, costs and taxes will be paid by the owner and landlord and these expenses will be charged as rent from the tenant. The owner can also incur a profit by charging more but its always recommended to charge rent for the expenses until the mortgage has been paid completely so that the rent becomes a profit.


The property value might also rise over the course of the mortgage and the property could become a more valuable asset. According to the Census Bureau, the value of real estate has increased consistently from 1940 to 2006 and then it has dipped and again increased from 2008 to 2010.


There are also chances that your tenant might damage the property or you might end up getting no tenant at all. This will result in a negative cash flow every month and you need to borrow from others for your mortgage payments. This also depends on the area of the property because if the rental rate is lower, more people would like to rent.


The biggest difference between a rental property and other investments is the amount of time and work you have to spend in maintaining your investment. Buying a stock will simply sit in your account and increase in value whereas for a rental property there might be more responsibilities for a landlord. If any problem arises, it's the landlord who will get the call. So you need to choose the best investment based on your needs.

Basic Legal Requirements of a Real Estate Contract

Real estate contract is one of the widely used tools in real estate business. Eventhough you are a beginner, you should know the nuts and bolts of how a real estate contract works. Contracts are usually drafted like an offer which will be signed by the buyer. Once a mutual assent arises, the contract becomes applicable.


To make a real estate contract valid, the following requirements are needed:


Mutual Assent - There must be a mutual agreement between the buyer and seller.


In Writing - The contract for purchase and sale of real estate must be written to be enforceable.

Identify the Parties - The contract must exactly identify the parties.

Identify the Property - The contract must exactly identify the property as well.

Purchase Price - The contract must exactly state the purchase price of the property.

Consideration - A contract must have consideration which is the interest that induces a promise.

Signatures - Contracts must be signed to be enforceable.

How to Determine Property Values in Today's Market

In the current market situation, figuring out the value of a property is very difficult. Comparable sales method is the most common method used to determine the value of single-family homes, condominiums and rental buildings.


You can even research about the sold properties of your area on local government websites. There are many online databases which allow you to check the price of properties within a specific area. They have complete details about the properties including square footage.


Several free websites also offer property data but the information would be less when compared to paid sites. Certain websites offer computer-generated valuation called automated valuation models which aggregate sales data. Local MLS are the most useful computer database for getting information about comparable properties. This database provides complete information about comparable properties and this data will not be available through other sources and these MLS aren't accessible to the general public.


There are many factors which has to be considered when evaluating a residential property but the key factors are location, size and the number of bedrooms and bathrooms.

Know the laws concerning real estate

Real estate is a highly-regulated business where lot of fraud and unethical practices happen. You can seek assistance from a real estate attorney, but you should also strive to educate yourself.


At a minimum, you should be aware of the following:

Landlord-Tenant Rules

How much does it cost to evict someone? How long will it take? Can I serve notices myself or if there are any special rules applicable for my city? Is there a limit for the security deposits? Should I pay interest for the deposits? How long can I hold the deposit once a tenant leaves?


Legal Documents


What form of documents are used in my area? Are there any special forms for real estate agents? You should be aware of the local forms and have knowledge about how to tailor them for your needs.


Recording Rules


What are the filing fees for legal documents and what format should we follow?


Disclosure Laws

What should be disclosed to a tenant or buyer? This information can be obtained from your local real estate investor's association.


Interest Rate Limits & Other Loan Regulations

Since the limit for charging interest might differ for each state, you must find the interest rate applicable for your state.


Fair Housing

When your rent your property, you should not discriminate against people based on race, religion, sex, age.


Licensing Laws


You need to check with your state licensing agency for information about licensing laws. You should also be aware of consumer protection laws.

How to deal with Agents in real estate

Real estate agents offer a valuable source of potential real estate deals for investors. Since real estate agents offer more information they are very important for an investor.


Most investors find it difficult to deal with real estate agents because they prefer home buyers with good credit and cash. They would like to get their interest money without any hassles. You should be ready to offer a reasonable commission to grab the attention of the agents. You should give more commission if you are presenting a solid cash.


Another important thing is to prefer a short closing date because agents will advise clients to take the offer which gets more commission and closes faster. If you want to give creative offers to the owner, you need to speak with them in person because if you present the offer to an agent it will not be presented in the same way to the owner.


Just like any other person, real estate agents would like to make more money. Unless you offer more incentives, you won't get the cooperation of an agent. Some agents are unethical and they will lie that your offer is rejected. If you come to know that a broker is not good, you can directly deal with the seller.

Flipping Properties for Cash Profit

Real estate is a business which is bought and sold every day. With just little information many people become real estate agents and help facilitate a sale by finding a buyer for a seller thereby getting commission.


Getting a real estate license is very simple but to succeed in the strong competition among other real estate agents requires a lot of hard work and struggle. They need to continue education classes and follow the guidelines set for them.

Flippers are investors who buy properties with the intention of selling it for a profit. A flipper will only spend short time with a deal and the profit potential will be much more than the agent's commission.

Three Types of Flippers

Scout
Scout is a person who finds and sells deal for a profit. Their job is to gather information and provide it to others for a fee. This fee depends on the price and profit potential of the property. Scout can make about five hundred to one thousand dollars on every deal.

Dealer
A dealer locates a property and signs a contract with the owner. Apart from providing information, he has control over the property and he gets more profit and assumes more risk than a scout.

The Retailer
A retailer buys the property from a dealer and fixes it up to sell it for a full price. Compared to other flippers, retailers invest more money and can make the largest profit on a deal than others. A retailer takes months to realize his profit whereas a scout or dealer makes money within few days.