Archive for

The Truth About Real Estate Investing and the Basics You Should Know

If you’re like many folks out there you’re impressed by gurus like Donald Trump and the fact that he can look at a property and tell you whether or not it will be a profitable deal. This kind of knowledge comes with experience and training. When you possess these abilities you have tremendous leverage over others who are investing by the seat of their pants. The feeling you’ll get when you close on your first profitable deal can only be described as sensational.

Your key to successful real estate investing is to understand important basic principles such as time value of money, risk, and project management.

First, time value of money, every dollar you invest in a piece of real estate must have a relative return to you. You are in the business of making money and maximizing profits. So your first task is to calculate your total return and the time frame you will receive it. You can figure this out with any amortization calculator on the internet. The general rule of thumb is you want to turn over your investment as fast as possible for the highest amount of profit.

Like any investment, real estate comes with it’s own inherent risk, knowing the basics of risk is important if you want to be successful. When purchasing real estate you need to consider a number of factors such as the neighborhood, condition of the property, interest rate and terms of the mortgage, amongst other things.

In most cases when you purchase real estate investment properties you will end up doing some refurbishing of the property. Some projects may be as simple as some cosmetic painting to complex jobs such as leveling a foundation. A key skill you will need is project management. Your skills in managing labor, materials and investment capital will literally make the difference between coming in on time and under budget or completely sinking your profits down the tube.

Basic steps when investing in real estate:

1. Find a neighborhood that is stable.
2. Take inventory of the condition of the property.
3. Calculate the time and investment needed to turn the property at a profit and then double it.
4. Negotiate the best price and terms possible with the property owner and your financing source.
5. Once you own a property, immediately put in place your marketing plan to sell the property.

The biggest sticking point most beginning real estate investors face is trying to hit a home run with their first project. Instead of purchasing a property that needs a lot of structural changes, go for one that only needs cosmetic changes (i.e. painting and landscaping) and this will allow you to gain experience before moving on to more difficult projects.

Finally, consider finding a property that you can finance over a 15 year period instead of 30 years. By doing this you will cut your cost of capital down by several thousands of dollars and build equity much quicker. This will allow you to move up into more expensive properties faster with much less risk.

Cheap Investments – How Flour and Sugar Can Double Your Money

There are literally a million ways in which people can make money. Whether they need extra money for life’s little unexpected surprises, or they need to find a way to bring in a steady income, they can do it with very little start-up, and only a little bit of effort.

So how can flour and sugar double your money? Well I can think of at least two ways right off hand. The first way is to make those cool gift jar mixes that everyone has these days. It’s a very simple idea; just take the dry ingredients of a recipe, such as the cocoa, sugar, and flour you normally start off a batch of brownies with, and you just layer them into a jar. Add some festive ribbon or fabric, a recipe card so the recipient can add the wet ingredients and complete the better, and it’s as simple as that! For an extremely cheap investment, you have just made something you can resell for 3 to 4 times that.

Another great way is to start selling cupcakes. There are not many people out there who don’t absolutely love cupcakes. If you have a few good cupcake recipes, or at least one really good one, then people will be lining up at your door to buy them by the dozen. You can even open your own online cupcake business and ship them all over the world!

Those are only two ways to double or even triple your money with a small investment of sugar and flour. If you take a few moments to think, you could either improve upon those two ideas, or come up with some of your own!

How to Find a Real Estate Investing Club – Avoiding the Bad Clubs and Succeeding With the Good Ones

One of the best resources for a real estate investor is your local real estate investing club. These groups can be great resources for networking and learning, but you must be careful, as there are some kinds of clubs that exist with the sole purpose of splitting you from your money,

Lets keep in mind that we’re looking at two types of club here.

The Bad Real Estate Club
The first club is basically one designed so the founders of that group can boost their egos or split you from your money. They are usually based completely upon the group’s founder’s accomplishments/brand and the goal is typically to sell their books, software, programs, etc. I’ve attended meeting of several of these “bad clubs,” and couldn’t get out of there quicker. Most of them spent a tiny fraction of their time talking shop and the bulk of their time pitching some kind of “opportunity”, which was typically a real estate deal that any experienced investor would have avoided like a plague. These are the bad clubs! Stay Away!

The Good Real Estate Club
The second type of club usually fosters an environment suitable for learning & networking. These clubs will typically have speakers or other presenters who provide educational information on various subjects. These clubs are usually comprised of people from all aspects of real estate (from professionals to investors to homeowners) who are looking to both network and learn. Most of these groups have time before or after the formal meeting for networking; this is probably the most important part of the meeting, so be sure to get there and bring your business cards! These are the clubs you want to be a part of.

In conclusion, if you’re looking to join a real estate investing club, check the club out before shelling out a years’ dues. Membership in one of the good kinds of real estate clubs can be a boon to your business, and for the newbies, a great help in getting started investing. Membership in a bad club will leave you with a bad taste in your mouth, and hours of wasted time.