One of the easiest ways to make money in real estate is to invest in bank foreclosures. Real estate investing has many different angles. But bank foreclosures are by far one of the simplest and can be one of the most lucrative ways to make money.
You don’t have to negotiate with a homeowner. You don’t have to attend an auction. You simply call up a bank’s REO department, which is the department responsible for managing homes that have been repossessed by the bank, and making an offer. Some banks will reject your offer. Some banks may come back with a counter offer. And some banks will accept your offer. It’s all a numbers game.
If you knew that for every 100 rejected offers you made, you would get 1 offer accepted? Would you be willing to make those 100 offers? Especially knowing the profit potential on typically bank foreclosures? Real estate investing is all about playing the numbers game.
If you understand the numbers and how they work, you can be extremely successful at what you do.
And don’t worry about getting approved for financing bank foreclosures. Real estate investing is still a thriving business, despite the downturn in the economy. In fact, real estate investing is on the rise now, as of this writing, despite the crash of the housing market.
The key is to find an undervalued home, rehab it, and flip it. If you can flip the house for well below its market value while still making a healthy profit margin, you should be able to resell the house relatively quickly.
Archive for ◊ March, 2010 ◊
Property management is not an easy task. Often, it becomes increasingly difficult to tackle your entire portfolio. In such cases you have to hire a property management firm. But till the time you can take care of it yourself, you need not make the extra expense of hiring such a unit. Here are a few tips on property management.
Look after renovations and repairs regularly
Unless you keep making constant renovations, a property will not retain its charm. It will open up a leaking basement or a damaged staircase or something else. In such cases the property will hardly present a rosy picture to the prospective buyers. Also, you shall think of non-structural modifications whenever you can. It adds to the class of your property. For instance, accent painting or fitting diffused lights can add to the effect amazingly.
Check for pending property arrears
If there are any property arrears, look for them. It is because most of the states are pretty severe with these norms. It might also include a lien that you might have overlooked.
Always ensure correct transfers
Though this phase comes before property management, it is just as important. While buying a property, always ensure correct transfers. Look minutely for multiple deeds or liens or fraudulent transfers or improper sales contact.
Look for correct flips
Property management portfolio is disturbed with one poor house flipping. Thus you shall make all your flips a success. This is possible if you design all your homes aesthetically. This way, buyers are bound to give a good price for it.
Choose tenants with a lot of care
This is most important as one nefarious tenant can spoil your show; thorough background check of each tenant is mandatory.
Keep precise account keeping
A precise book of records keeps you updated and white-collared in the eyes of IRA. So you must make sure that you don’t have a pending tax or property paper
Put expeditious ads for vacancies
Just as you anticipate a vacancy, put strong ads for re-filling. It can be done via newspaper classifieds, pamphlets and online bombardment. Today, you can generate real estate newsletters just as well.