Updated Events and Calls for February

We have updated our webinar and call schedule for February so please go to our Events page for the registration links.  We have a lot of great content and experts featured this month so mark your calendars!

Events and Calls

Why Markets Determine Profit

One of our staple markets for cash flow investing is Cincinnati, we like this market for two main reasons.

1. Cash Flow

2. Inventory

As you can see in this image, I did a search on Realtor.com.  The parameters for the search were 3 bedrooms or more and a price point between $5,000 and $60,000, which I feel is the sweet spot for maximizing cash flow.  We eliminated condo’s and town homes and focused on single family and multi family properties and 532 properties came up.   Cincinnati is a stable market with little appreciation, or devaluing.  What it is good for is long term buy and hold for cash flow, and fix and flip opportunities.

As I look up rent averages in Zilpy we find that a 3 bedroom house will rent for on average $895.00.  So if I can find a steady supply of properties under $60,000 with rent of $895 I have a lot of opportunity to find solid double digit returns.  This is one of the reasons that inventory is important to me.  With over 500 homes available, I can be particular about the neighborhood, and the condition of the property.

By researhing markets by inventory and cash flow I can quickly screen high profit market opportunities.  Once I have identified a market online, I then start to expand my research and check on the demographics, vacancy, long term outlook ect…  If the data then meets my criteria then I start to call local investors and property managers to confim my research.   Once a market passes all of the requirements we have the fun begins… Offers and Accepatnace…and CASH FLOW

New Homes Plunge…Good News for Me!

CNN just reported that sales of newly constructed homes plunged to the lowest level on record….going back to 1993.   The U.S. Census put out that Decembers sales pace was 44.8% below the same month last year.  If your a builder, or you invest in construction stocks, this is certainly alarming, however if your investor, lets dig a little deeper into the numbers.

• First inventories for homes on the market have been dropping now for 5 consecutive months.
• New homes are not selling because you can buy foreclosures for pennies on the dollar
• 5% Mortgage Rates
• The number of “Existing Homes” sold in December rose 6.5% from the previous month

So with inventories declining and low mortgage rates, investors are starting to dip their toes back into the market.  I see this as a positive indicator in an economy that continues to show weakness.   As a full-time Real Estate investor, I continue to look for value opportunity properties that I can hold for 3-7 years as we watch the market cycle around.

Are You Ready for 2009

Last night, I was reading through “Think and Grow Rich” …again.   In the last chapter, Napoleon Hill talks about the six ghosts of fear.  In this chapter Hill states that before you can put his philosophy to work, your mind must be prepared to receive it.  To be mentally prepared to receive wealth and success, you must understand and clear out  three enemies – Indecision, doubt, and fear.

As you look at the Real Estate and Financial Markets for 2008, and then look within yourself, what do you see?  Are you afraid of making a mistake, or going broke?   Many of the investors we talk to are?

What Hill came to understand while writing ‘Think and Grow Rich” is that indecision, doubt, and fear are nothing more than a state of mind.   Therefore, you can control it!  You must choose between riches and poverty, and understand that not choosing is a choice.

“There can be no compromise between poverty and riches!  The two roads that lead to poverty and riches travel in opposite directions.  If you want riches, you must refuse to accept any circumstance that leads towards poverty. (The word “riches” is here used in its broadest sense, meaning financial, spiritual, mental and material estates.)  The starting point of the path that lead to riches is desire…..Here4 thin, is the place to give yourself a challenge with will definitely determine how much of this philosophy you have absorbed.  Here is the point at which you can turn prophet and foretell, accurately, what the future holds in store for you…If you are willing to accept poverty you may as well make up you mind to receive poverty.  This is one decision you cannot avoid.  If you demand riches, determine what form, and how much will be required to satisfy you”.

Napoleon Hill,    Think and Grow Rich

As 2009 arrives, demand riches…Make decisions, eliminate doubt, and focus on successful activities.

Take this time to plan out your goals for 2009, be specific and detailed.  Read this every day for the next 60 days and get into action.  If you are ready to start the new year, we have a Free Report on wholesaling ready for you to download…just go to:

http://www.pmwholesaledeals.com/

Make this year the success that is within you!

Only $56,000 and lots of Cash Flow

Cash Cow in Columbus Ohio….

Columbus Ohio Duplex

For Detail on this and other cash flow properties email us at:

Propertymaverick@gmail.com

Are you in the right market?

Too many of the investors we talk with start by choosing a market.  Unfortunately, this market is typically the market they live in.  Sure on the surface this makes sense, investing in the market you live in gives you a sense of control however, for many of you that may not hold true.   First, Real Estate Investing should be about the financial statement, not the property.   Many people who invest in their “Back Yard” justify poor returns because they know the area.

Lets take a look at two different markets across the country; Tulsa, Oklahoma and where I live, Denver, CO

	Tulsa	Denver
Population	382,000	567,000
Median Home Price	$83,600	$165,800
Section 8 Rent 3 bed	$849	$1,291
Inventory under $100K	651	182

While I live in Denver, I would much rather invest in Tusla for the following reasons.

1. Inventory, with 651 properties under $100k I can be more selective on the neihborhood and condition of the property.
2. Median House Price, With a median under $100K I can find more properties that cash flow well.
3. Rents, The ratio between the rent and property prices is significantly better in Tulsa.
4. In Tulsa there are 44 properties under $20k…I can do alot of fix and flips with those prices.
5. According to the Office of Federal Housing and Economic Oversight, Tulsa has continued to appreciate over the last year.

So when you are looking at investing in Real Estate and you are looking at the numbers, make sure the markets you invest in make financial sense.

Will Inventories Stabilize?

Freddie Mac has ordered its national network of service providers to suspend forclosures until January 9th.  This “time out” is designed to get lenders implement its Streamlined Modification Program recently announced by Freddie Mac.  In addition morgage interest rates have dropped to 5.5% fueling substantial refinancing.  

So what does this mean for investors?  I believe the best news would be the return of consumer confidence in the real estate market. 

What we find so interesting in today’s market, is that there is no end to the phenomenal deals on the buy side.  It is easy to go out and buy a property for $.30 – $.60 cents on the dollar.  Add to that, where the rental market in many areas of the country is still strong and you have solid long term buy and hold opportunities.   The only problem, is that for many investors we can’t get loans to keep buying all these great deals.  So when I hope for inventories to stabilize and consumer confidence to return, what I really hope for is for Freddie and Fannie to relax their guidelines on the number of investor loans (currently you can have four loans).  By allowing investors to continue to purchase excess inventory at pennies on the dollar lenders and consumers all win.

Opportunites and Education

Last night we hosted a conference call to dicuss several of the markets across the country we like as well as some of the opportunies we are offering.  We had a great group on the line and it was educational and entertaining for all.  To listen to the recording of this call, click here:   http://www.screencast.com/t/GGZXleNTK

Going forward we will be hosting calls twice a month, to get on our mailing list to be notificd of the calls please follow this link and  enter your name and email:  http://www.pmwholesaledeals.com/    In addition to getting on our investment mailing list we will send you a free report on how to buy wholesale deals, and a host of interesting articles and information.

As we watch the economy struggle to find its way back, these calls are designed to show you how solid fundamental real estate can help you build wealth and diversify your portfolio. 

Cheers,

Tim

Multi-Family Tips for Beginners

Investing in real estate has long since been known as the surefire vehicle to wealth. Unfortunately, the ready cash or stellar credit needed to buy and sell a parcel quickly is not available to the average investor and to this end a new practice has sprung up: multi-family real estate rental investing.

The investor becomes landlord and real estate shareholder in one. As an added bonus, if the savvy investor chooses to occupy one of the apartments, her or his mortgage payment may quite possibly be defrayed by the rental payments of the other tenants.

Yet before you are led to believe that this form of investment is simple, keep in mind that pitfalls are lurking just out of sight with any kind of rental situation! For the fearless and determined investor, here are some multi-family real estate investment tips for the beginner:

Multi-family rental success with rental agreements

Investment success in this venue is determined not by looks and some pretty shrubbery in front of the building but instead by cold hard figures, such as rental agreements dating back at least five years. What you want to see are turnover numbers – how often was an apartment vacant – and also the length of time that it stood vacant. Sellers all too often claim that their properties are much sought after and renting them is a snap, yet if you find that a unit stood vacant for about three to six months, then there might be a problem.

Multi-family rental cash flow

When looking at multi-family real estate for the sake of investment, consider the benefit of the steady cash flow. All too often you might be tempted to take the money and reinvest it into the property to spruce it up and perhaps then raise the rents. This is a common mistake which should be avoided. Instead, use any profits you receive and invest them toward purchasing more multi-family rental properties or in the alternative other investments you might have had your eye on.

Where to look for Multi-Family investments

Realize the potential of increasing equities if you invest in up and coming neighborhoods. While today the area may still look a bit tough around the edges, closely monitoring the big investment firms will tip you off to which neighborhoods may be considered up and coming. Capitalize on the research done by them and purchase rental property there. As the neighborhood improves and property values go up, you will see your investment increase in value as well.

Multi-famil investment management companies

Consider hiring a management company for the daily chores. While it will be a bit of an expense, the luxury of not having to deal with broken toilets after midnight or evictions is well worth the fee!

One of the most overlooked benefits of starting out your real estate investment career as a landlord is the vast plethora of people skills you will develop. Dealing with tenants – even if you hire a management company – not only hones your ability to read people but also enables you to understand the individuals’ needs who are renting. This comes in handy for future transactions!

Develop Partnerships for Fast Profits

When I fist began investing in real estate, I believed that the name of the game was to buy a property, put tennants in and try to make passive income…meaning try not to spend more than the incoming rent every month.  Years later, I still belive this is an imprtant part of investing, but if I had a do-over, I would definately start with wholesaling properties, and I would do it with a twist.

In every market I go to i meet professional wholesalers who have a commanding knowledge of thier local markets.  They find great deals on a regular basis, there only limiting factor is finding buyers.  I on the other hand have found it easy to set up systems to find qualified buyers all day long. So, by parntering with these wholesaler and feeding them buyers I am able to ask for 50% of the wholesale fee they arranged. 

What I like about this is that I can focus my efforts on finding buyers and I can present them with opportunities from dozens of markets across the country and not just my market.  This gives me a much better chance of selling the buyers something.

For a video on how to make $50,000 a year working part time doing this, go to:

http://www.screencast.com/t/dsqjPRvKk9

Success is in action…so go do it!