Showing posts with label Real Estate Market. Show all posts
Showing posts with label Real Estate Market. Show all posts
Wednesday, October 8, 2014
Monday, September 15, 2014
Wednesday, September 10, 2014
When is Disclosure too Little, too Much or Just Right?
Real estate agents walk a fine line regarding disclosure in meeting their fiduciary responsibility to their clients. The question is when is disclosure too little, too much or just right? The truth is that there are no absolute answers, just common sense practices that an agent can follow to best serve their client and protect themselves.
We recently took a look at the C.L.U.E. report which has been available for approximately the last 8 or 9 years. Re-Insider finds this report to be a great example of the variety of information that can find its way into today’s real estate transactions.
The first question that should always be looked at when vetting disclosure information is, is there a legal requirement in the California Civil Code for a particular disclosure of information? If there is, for example the NHDS or TDS in most residential transfers, then it has to be in the disclosure information to the buyer.
The first question that should always be looked at when vetting disclosure information is, is there a legal requirement in the California Civil Code for a particular disclosure of information? If there is, for example the NHDS or TDS in most residential transfers, then it has to be in the disclosure information to the buyer.
But what about non legally required reports, C.L.U.E. being a good example? In the case of C.L.U.E. reports being provided, this grew simply from CAR adding a question to their SSD form which was then incorporated into the SPQ on page one. This is a form that has grown over the years to 10 questions in which a seller is advised, by CAR, to disclose to a prospective buyer of their residential property. The question on the CAR SPQ regarding insurance claims is simply “Insurance claims affecting the property in the last five years”— answer to be given as simply yes or no.
So how did the additional information contained in a C.L.U.E. report, not requested or required, come into use and does it potentially pose a liability to the agent? The quick answer to the first question for coming into use is money. What was once a simple yes or no answer from the seller is now a $19 + report that companies make money selling into the transaction.
As far as the question of liability to the agent, if the additional information in the C.L.U.E. report has a mistake in it, as happens from time to time and causes some of the problems discussed in the previous article, then who takes responsibility? The most common response from agents is the company that sold the report to me of course. But as it turns out this is not necessarily the case.
Why you ask? The C.L.U.E. report comes with no guarantee or indemnification from LexisNexus, the company that produces the report. The resellers, usually disclosure companies, all have a third party exclusion in their limits of liability that state they are not responsible for mistakes in information provided to them from outside sources.
This can leave the real estate agent or brokerage financially responsible for the C.L.U.E. report if there is a problem. The message in this for agents, using C.L.U.E. reports in this case, is to look at your disclosure procedures with an eye towards not only meeting your fiduciary duties to your clients, but managing your own risk. With that in mind, with the case of C.L.U.E. reports the best answer may be to use the CAR SSD form.
What do you think of this situation? Are you in favor of regulating disclosure companies?
RE Insider read more here:
Tuesday, September 9, 2014
How to Restore Your Credit Score Quickly
Buying a home is the American dream and you have decided that it is time to start looking into buying a home of your own. That's great! However, you probably know that there are things you should be doing before you begin your search - but where do you start? The first thing you need to get in order, before you do anything else, is to get a copy of your credit reports. That's plural - credit reports.
You need to get a copy of your credit reports from all three credit reporting agencies - Trans Union, Equifax and Experian. If you are thinking about buying a house, you may not realize the importance your credit reports hold in getting an approval for your new home.
The mortgage companies are more concerned about your recent buying and repayment history than what may have happened years ago. If you have too many recent late payments or collections, there may not be anything you can do to get approved in the immediate future.
However, there are some things you can do to clean up your report. So in six months to a year or maybe even two years, depending on how bad your credit is and how long it takes you to clean it up, you can apply for a home mortgage and get your approval.
Here are a few things you can do to restore your credit and credit score quickly:
1. Check your credit reports for errors. Again , that is plural so check all three of your credit reports for errors. If there are mistakes on your credit reports, you will need to start an investigation with the company or the source of the derogatory information. Contact them in writing and make sure you include all supporting documentation proving the information is in fact an error.
2. Set up a timely repayment schedule. If you have any accounts that you have been late in paying, you will need to begin paying all of them on time. Paying your bills on time for a minimum of six months will go a long way in improving your credit rating.
3. Collections. Try to avoid having your accounts turned in to collections. A collection is the most damaging of all credit issues. So work out a re-payment plan before your account turns into a collection. A credit improvement agency may be able to help you get your collections erased; but only if the creditor did not abide by all of the laws of the Fair Credit Reporting Act. However, this is generally not the case because most creditors know the laws and how to follow them. So don't count on this as a quick fix . Most collection accounts will stay on your credit report for a minimum of seven years.
4. Keep a low balance on all of your revolving credit accounts. Try to keep your balances below 50% of your limit. The lesser the balance the better it looks to potential creditors.
5. Do some soul searching. Try to determine what caused your credit status to get out of control in the first place. Then do whatever you have to to amend your bad habits - if any.
6. Get a secured credit card. Secured credit cards can be very helpful in improving your credit. There are many things you can do to get your credit report back on track quickly. So talk to your real estate agent for more information about how you should go about doing this.
In the meantime, your Realtor will be able to get you started on your path to home ownership while you are working out your credit issues. Your agent has the experience and the know how to help you get into your new home as quickly as possible. So take advantage of all they have to offer you.
The mortgage companies are more concerned about your recent buying and repayment history than what may have happened years ago. If you have too many recent late payments or collections, there may not be anything you can do to get approved in the immediate future.
However, there are some things you can do to clean up your report. So in six months to a year or maybe even two years, depending on how bad your credit is and how long it takes you to clean it up, you can apply for a home mortgage and get your approval.
Here are a few things you can do to restore your credit and credit score quickly:
1. Check your credit reports for errors. Again , that is plural so check all three of your credit reports for errors. If there are mistakes on your credit reports, you will need to start an investigation with the company or the source of the derogatory information. Contact them in writing and make sure you include all supporting documentation proving the information is in fact an error.
2. Set up a timely repayment schedule. If you have any accounts that you have been late in paying, you will need to begin paying all of them on time. Paying your bills on time for a minimum of six months will go a long way in improving your credit rating.
3. Collections. Try to avoid having your accounts turned in to collections. A collection is the most damaging of all credit issues. So work out a re-payment plan before your account turns into a collection. A credit improvement agency may be able to help you get your collections erased; but only if the creditor did not abide by all of the laws of the Fair Credit Reporting Act. However, this is generally not the case because most creditors know the laws and how to follow them. So don't count on this as a quick fix . Most collection accounts will stay on your credit report for a minimum of seven years.
4. Keep a low balance on all of your revolving credit accounts. Try to keep your balances below 50% of your limit. The lesser the balance the better it looks to potential creditors.
5. Do some soul searching. Try to determine what caused your credit status to get out of control in the first place. Then do whatever you have to to amend your bad habits - if any.
6. Get a secured credit card. Secured credit cards can be very helpful in improving your credit. There are many things you can do to get your credit report back on track quickly. So talk to your real estate agent for more information about how you should go about doing this.
In the meantime, your Realtor will be able to get you started on your path to home ownership while you are working out your credit issues. Your agent has the experience and the know how to help you get into your new home as quickly as possible. So take advantage of all they have to offer you.
Thursday, September 4, 2014
6 Common Mistakes Homebuyers Still Make
Getting a new home is easy but tricky at times. Many buyers are encountering stumbling blocks en route to their chosen house. This is because they commit minor mistakes along the way that hinders smooth processing. This can be prevented only if you are familiar with these common mistakes.
1. Having no pre-arrangements with the bank for mortgages before making an offer is the most popular mistake. Communicate with a bank to know the price range you are capable of paying and other mortgage details that you need to know.
2. Knowing your exact budget is critical. Most people look around for houses even without the budget in mind. First thing you need to know before finding a home to purchase is how much you can pay for a new home. You can save much time if you trim down your list of houses based on its price; imagine finding that dream home only to find out you won’t be approved for the mortgage?
3. Getting unreliable and inexperienced real estate agents is a big no-no. Choose an agent that has the background to back him or her up. Also, consider the real estate companies you are dealing with. Make sure that they have a good standing in terms of the services they are providing.
4. Most people are shopping around within a limited market. You can find homes for sale anywhere such as internet, print ads, and even on TV. You may also want to ask for help from your agent to provide you a list of preferred houses. You can save time if you know what kind of house you are looking for.
5. Purchasing a home long distance without thorough inspection is a mortal mistake. After choosing a home, it is a must to visit it personally so that you can see it in a closer view. Some pictures only show the good angles of the house. It can be very deceiving at times. Check the structure and foundation to ensure safety. Also, look around the neighborhood and get comfortable with it.
6. Buyers tend not to compute the total cost of the house. Other expenses such as home insurance, association dues and even lawyer's fee for proper documentation of the purchase should be considered. We are not talking about coins here. These range from hundreds of dollars to even thousands. You need to prepare your pocket for it.
Buyers are usually not aware of all the details. It is your home and you are responsible for it. You need to know and understand everything about it, from home warranty to insurances and even the history of the house.
1. Having no pre-arrangements with the bank for mortgages before making an offer is the most popular mistake. Communicate with a bank to know the price range you are capable of paying and other mortgage details that you need to know.2. Knowing your exact budget is critical. Most people look around for houses even without the budget in mind. First thing you need to know before finding a home to purchase is how much you can pay for a new home. You can save much time if you trim down your list of houses based on its price; imagine finding that dream home only to find out you won’t be approved for the mortgage?
3. Getting unreliable and inexperienced real estate agents is a big no-no. Choose an agent that has the background to back him or her up. Also, consider the real estate companies you are dealing with. Make sure that they have a good standing in terms of the services they are providing.
4. Most people are shopping around within a limited market. You can find homes for sale anywhere such as internet, print ads, and even on TV. You may also want to ask for help from your agent to provide you a list of preferred houses. You can save time if you know what kind of house you are looking for.
5. Purchasing a home long distance without thorough inspection is a mortal mistake. After choosing a home, it is a must to visit it personally so that you can see it in a closer view. Some pictures only show the good angles of the house. It can be very deceiving at times. Check the structure and foundation to ensure safety. Also, look around the neighborhood and get comfortable with it.
6. Buyers tend not to compute the total cost of the house. Other expenses such as home insurance, association dues and even lawyer's fee for proper documentation of the purchase should be considered. We are not talking about coins here. These range from hundreds of dollars to even thousands. You need to prepare your pocket for it.
Buyers are usually not aware of all the details. It is your home and you are responsible for it. You need to know and understand everything about it, from home warranty to insurances and even the history of the house.
Thursday, August 28, 2014
You've Opened Escrow, Now What?
Congratulations, you are on your way to owning your very own home!
Follow these suggestions (and your realtor's advice) so that escrow and settlement with go as smooth as possible.
- You will be asked for a down payment on the home you are purchasing. You can choose to put down as much or as little as you want (depending on your mortgage), but remember, the more you put down toward the total price of your home, the less time it will take you to pay off and the less your mortgage payments will be every month.
- During this period of purchasing your home, you are going to need an escrow or settlement company to act as an independent third party so that you know when and who to give your money to get the deed to your new home. The escrow or settlement company will hold your deposit and coordinate much of the activity that goes on during the escrow period. This deposit check may also be held by an attorney or in the broker's trust account. Make sure that there are sufficient funds in your account to cover this check.
- The deposit check will be cashed. Assuming the sale goes through, this money will be applied to the purchase price of the home. If for any reason the sale is not consummated, you may be entitled to receive all of your deposit back, less standard cancellation fees. In certain instances, the seller may be able to retain this money as liquidated damages. Prior to executing a purchase contract, it would be wise to speak with your counsel regarding whether or not it is your best interest to have a liquidated damages clause as part of the contract.
The period that you are "in escrow" is often 30 days, but may be longer or shorter. During this time, each item specified in the contract must be completed satisfactorily. By the time you have opened escrow, you have come to an agreement with the seller on the closing date and the contingencies. Each contract is different, but most include the following:
- Inspection contingency: this should be completed as soon as possible after the contract to purchase is signed as unsatisfactory results of the inspection may mean that you will want to cancel the contract.
- Financing contingency: once the contract is signed, you have a period of time to secure funding. If, for any reason, you are unable to secure funding during the period of time granted to you by the contract (and the seller will not provide a written extension of time), you must decide whether you want to remove the contingency and take your chances on getting a loan. You may choose to cancel the purchase contract.
- A requirement that the seller must provide marketable title.
With an attorney or title officer, review the title report. The title must be "clear" to ensure that you do not have legal issues regarding your ownership.Check into local and state ordinances regarding property transfer and make sure that you and/or the seller have complied with them.
Secure homeowner's insurance. This will probably be required before you can close the sale. Due to such requirements as special fire and earthquake insurance, obtaining this insurance may require a lengthy period of time. It would be in your best interest to apply for insurance as soon as possible after the contract is signed.
Contact local utility companies to schedule to have service turned on when you close escrow.
Schedule the final walk-through inspection. At this time, you should make sure that the property is exactly as the contract says it should be. What you thought to be a "permanently attached" chandelier that would come with the property might have been removed by the seller and replaced with a different fixture entirely.
You've made it! Once the sale has closed, you're the proud owner of a new home. Congratulations!
Thursday, August 21, 2014
High-End Home Sales Soar throughout California
By RE Insider
While home sales throughout much of California have remained flat throughout this spring and early summer, a new study has indicated that multimillion dollar homes are selling in record numbers, offering hope that the market is still improving and prompting many to wonder what’s holding the rest of the market back.
According to a recent study performed by San Diego-based DataQuick, $1 million-plus sales grew at a 9.1% clip statewide compared with last year, while sales overall fell 7.4%. Additionally, California in the second quarter set all-time records for the number of homes sold for more than $2 million, more than $3 million, more than $4 million and more than $5 million.
What’s driving these high-end home sales? According to market-watchers, there are several factors.
One is the hot technology sector in the Bay Area and some affluent parts of Southern California, which is minting new millionaires who can afford seven-figure homes. Another is the 11.6% price growth in California over the last year, which means a house worth $925,000 last summer may be worth $1.03 million today. And there’s the influx of international buyers, which is pushing up prices at the high end.
“It’s always fascinating to watch this part of the real estate market. It behaves differently, responds to its own set of criteria,” said DataQuick analyst Andrew LePage. “These buyers, especially those in the multi-million-dollar market, are less likely to agonize over credit scores, income and job security, down payments and mortgage interest rates.”
With this in mind, do you think this the market is improving as a whole? And considering that mortgage rates remain historically low, what do you believe is holding other buyers back?
Monday, August 18, 2014
Monday, August 4, 2014
2014 International Home Buying Activity
NAR has released their annual 2014 Profile of International Home Buying Activity and it shows a significant increase in sales to international buyers. As the report states:
For the period April 2013 through March 2014, the total sales volume to international clients (“international sales”) has been estimated at approximately $92.2 billion, a 35 percent increase from the previous period’s level of $68.2 billion.
International Buyers
HOW MUCH ARE THEY SPENDING?
WHERE ARE THEY FROM?
WHERE ARE THEY GOING?
Their are many factors that go into how International Buyers decide which part of the U.S. they will move to. The Presence of relatives, friends and associates, job and education opportunities, and climate and location seem to be the most important. Europeans are more attracted to states with warmer climates such as Florida and Arizona. While the West Coast is attractive to Asian buyers. Buyers in Mexico prefer states in close proximity such as Texas, Arizona, California. Florida appears to be more attractive to South Americans as well as Europeans and Canadians. Buyers from India are located in urbanized areas and states home to IT companies such as California, New York and North Carolina.
Thursday, July 31, 2014
Million-dollar home sales hit seven-year high in California
LA TIMES | by Tim Logan
The number of homes that sold for $1 million or more in California hit a seven-year high in the second quarter, and sales north of $2 million reached a new record.
That’s according to new figures from San Diego-based DataQuick, which tracks local housing markets in the state. They found million-dollar-plus sales grew at a 9.1% clip statewide compared with last year, while sales overall fell 7.4%.
Several factors are driving the high-end liftoff, market-watchers say...
READ MORE HERE...
Wednesday, July 9, 2014
Monday, June 30, 2014
New Home Sales Surge 18.6%
New-home sales soared in May, but the gains simply put the market back on track to match last year's overall pace, rather than signaled a significant momentum gain.
Home builders, economists and analysts described the May increase as a delayed rebound to normal sales levels after a weak start to the spring selling season, which was hampered by harsh weather and the fitful economic recovery. Many cautioned that one or two more months of strong gains are needed to prove that the housing recovery indeed has gained steam.
Prices, in contrast, are up sharply. The median sales price of new homes sold in May was $282,000, almost 7% above a year earlier.
Tuesday, June 24, 2014
14 Sneaky Mistakes that can decrease your Homes Value
1. Choosing a crazy exterior color
"Curb appeal is huge, don't pick a paint color that isn't common in your neighborhood or doesn't fit the style of your home." -Pam Baldwin Foarde of Al Filippone Associates/William Raveis
2. Landscaping without a plan
"Planting trees too close to the house or driveway - without considering how big they're going to get - creates major problems later. Roots can cause breaks in the pavement that might raise your homeowners insurance or make it hard for you get a policy until the problem is fixed. Before you plant anything, think about how it will look in twenty years." -Chris Winn of Kellar Williams/Advantage Group
"Planting trees too close to the house or driveway - without considering how big they're going to get - creates major problems later. Roots can cause breaks in the pavement that might raise your homeowners insurance or make it hard for you get a policy until the problem is fixed. Before you plant anything, think about how it will look in twenty years." -Chris Winn of Kellar Williams/Advantage Group
3. Ignoring your entryway
"Having a front door lock that doesn't work properly or hardware that looks old and pitted makes buyers uneasy and puts them on high alert for what else has been let go in the house." -Donna Marie Baldwin
of Coldwell Banker
"Having a front door lock that doesn't work properly or hardware that looks old and pitted makes buyers uneasy and puts them on high alert for what else has been let go in the house." -Donna Marie Baldwin
of Coldwell Banker
Wednesday, June 11, 2014
Thursday, May 15, 2014
Monday, May 12, 2014
The 5 Money Making Advantages Of Multi-Unit Investing
by David Lindahl | REI Club
Having rehabbed over 470 properties in the last seven years and collected over 600 apartment units I’m often asked, how can I become wealthier faster investing in real estate?
While most investors concentrate on some aspect of single family houses, I was always interested in multi-units (apartments) first, and then single family homes as a means of getting more multi-units .
From the very beginning of my investing in real estate, I liked the idea that a group of people (the tenants in a building) would get together and pool their money to pay down the mortgage on a property, and I liked the idea that they would also pool their money together to pay for all of the maintenance work for a building.
I especially liked the idea that they would give an owner so much money that the owner would have a bunch of money left over at the end of every month that could be used to either re-invest, save or to go out and have a good time with.
Essentially, I like the idea that other people were willing to help make me wealthy. I liked it even more when I started using management companies to manage my properties and no longer had to have contact with my tenants.
I soon came to realize that I could also wholesale, retail, pre-foreclosure, rehab, subject to and lease option apartment houses as well.
I also realized that there were certain advantages that investing in multi-units buildings had over single families.
While most investors concentrate on some aspect of single family houses, I was always interested in multi-units (apartments) first, and then single family homes as a means of getting more multi-units .
From the very beginning of my investing in real estate, I liked the idea that a group of people (the tenants in a building) would get together and pool their money to pay down the mortgage on a property, and I liked the idea that they would also pool their money together to pay for all of the maintenance work for a building.
I especially liked the idea that they would give an owner so much money that the owner would have a bunch of money left over at the end of every month that could be used to either re-invest, save or to go out and have a good time with.
Essentially, I like the idea that other people were willing to help make me wealthy. I liked it even more when I started using management companies to manage my properties and no longer had to have contact with my tenants.
I soon came to realize that I could also wholesale, retail, pre-foreclosure, rehab, subject to and lease option apartment houses as well.
I also realized that there were certain advantages that investing in multi-units buildings had over single families.
- The first was cash flow. Cash flow on a multi-family is always greater than that of a single family. Simply because you have more rents coming in.The more units you have under one roof, the less risk you have. If you have a single family house and you lose your tenant, you’ve lost 100% of your income. In some instances, this could be your entire profit for the year. If you had a three family and lost a tenant, you still have two rent coming in to pay your expenses.
- Economies of scale are in mulit-unit buildings. If you have six single family houses opposed to one six family, you have six roofs to be replaced or repaired, six lawns to be maintain, six tenants spread out through out your city or town.In your six family you have one roof, one lawn and your tenants are centrally located. Economies of scale are in your favor.
- There’s a lot less competition than there are in single family houses. Why? Because no one is out there teaching how to do it and all the single family guru’s make flipping single family houses sound as easy as chewing gum in the dark. The smart investors put multi-units in their portfolios along with single family houses.
- Because of the bigger cash flows, you can afford to hire management companies to manage your tenants, thus eliminating that hassle while you go out and do what you do best (or should do best), find and finance them.
- Your pay days are a lot bigger when you finally sell your property. This is because an apartment complex cost more than single family homes, because of this they obtain a greater dollar amount of appreciation. For example, a $100,000 single family house will in a market that appreciates 10% will be worth $110,000 while a three family house worth $300,000 in the same market (10% appreciation) will increase to $330,000. That’s $20,000 more money in your pocket!
You’ve know a few people who have made a lot of money flipping single family houses, but if you think of the all the people you know who have become extremely wealthy through real estate, you’ll realize that they did it through owning multi-units (apartments).
These are the five biggest advantages to investing in multi-units, there are many, many more. If you are interested in creating more wealth at a faster rate, adding multi-unit to your portfolio is the way to do it!
These are the five biggest advantages to investing in multi-units, there are many, many more. If you are interested in creating more wealth at a faster rate, adding multi-unit to your portfolio is the way to do it!
Friday, May 9, 2014
These Are The 10 Richest Small Cities In America
Rancho Palos Verdes made the Movoto list @ #9...
They might be tiny, but these places make up for it with big bank accounts, fast cars, and more luxurious amenities than you can shake a 24 karat gold stick at.
We talk a lot about superheroes, cartoon characters, and even the occasional royal figure here on the Movoto Real Estate Blog, but most of the time we’re telling normal folks like ourselves where the best and safest places are to live.
Every once in a while, though, we wonder what life must be like for the 1 percent—what sort of places they live in, and what sort of things they need. It’s for that reason why we decided to turn our ranking prowess toward finding the enclaves of our country where the truly wealthy reside.
What we found is that, when it comes to small cities and towns, there’s none richer—in terms of actual wealth or things the wealthy enjoy—than Bethesda, MD. In the process, we also determined the top 10 richest small cities in America, which are:
1. Bethesda, MD 2. Palo Alto, CA 3. McLean, VA 4. Redondo Beach, CA 5. Menlo Park, CA 6. Lexington, MA 7. Brentwood, TN 8. Foster City, CA 9. Rancho Palos Verdes, CA 10. Laguna Niguel, CA 10. Hoboken, NJ
How We Made This Ranking
Even if you’ve read one of our Big Deal List rankings before, you’ll want to pay attention, because this one’s a little different.
In order to determine which small cities in the U.S. are actually the richest, we started with a list of 950 places with populations between 30,000 and 80,000 people according to the 2010 U.S. Census. We then ranked these places from 1 to 950 based on two categories: median household income and median home value, using data from the 2010 Census, with one being best.
The average of these two scores was used to determine the top 25 most wealthy small cities in the country. From there, we gathered further data on just these 25 places in nine additional categories we chose to encapsulate a truly rich place:
- Really expensive fine dining establishments per capita
- Really expensive clothing retailers per capita
- Really expensive jewelry stores per capita
- Luxury car dealers per capita
- Country clubs per capita
- Cosmetic surgeons per capita
- Distance to nearest polo field
- Distance to nearest yacht club
- Distance to nearest private airport
For the first six criteria, we used business listings and only considered businesses actually located within city limits. For the last three, we used the distance to the closest field, club, or private airport by actual driving miles.
Each place was given a score from 1 to 25 in the individual criteria, with one being best. We then averaged these rankings together into an overall Big Deal Score, with the lowest score being the richest small city.
Now that you know how we put the ranking together, let’s take a look at the top places and how they fared across all these various criteria. You might want to grab yourself a top hat and monocle to wear while you read for optimal richness simulation.
9. Rancho Palos Verdes, CA
| Country Clubs Rank | 1 | Luxury Car Dealers Rank | 8 | Polo Field Distance Rank | 16 |
| Really Expensive Fine Dining Rank | 1 | Really Expensive Clothing Rank | 11 | Private Airport Distance Rank | 18 |
| Yacht Club Distance Rank | 5 | Really Expensive Jewelry Stores Rank | 11 | Plastic Surgeons Rank | 22 |
Six hours south of Foster City, but still located on the water, Rancho Palos Verdes is home to some of the Los Angeles area’s most prime seaside real estate. That explains its median home value of $973,900 in 2010, but its median household income of $119,778 is also sky-high. Residents can spend that money on fine dining like nowhere else, as Rancho Palos Verdes ranked first overall for hyper-expensive cuisine. It was also first for country clubs per capital and, owing to its coastal location, fifth for distance to the closest yacht club.
Wednesday, May 7, 2014
Why you should Invest in Real Estate, Right Now.
In a recent post by Jerry Lynch on MSNBC Real Estate, Jerry commented on why right now is a great time to invest, and he had some good stuff to say...
Jerry Lynch| CNBC
I have said this many times. You will not get rich in the stock market, you will get reasonable rates of return over time but people who are wealth generally do not do it that way. Wealthy people are wealth because of 1 of 4 things.
- They inherited it (Rockefeller)
- The owned a business (Gates)
- They did it in real estate (Trump)
- On they invested systematically for a long period of time in the stock market.
Adam Jeffery | CNBC
Here is why I think it is still a great time to invest in real estate:
1. Low interest rates. My first job out of college back in the 80's was selling vinyl siding door to door and we would try to convince people to use a home equity line of credit — at 18 percent — to pay for the siding. Today, you can probably get a 30-year mortgage on a rental property for under 5 percent (generally there is an additional increase in interest since it is a rental property). So, if you borrow $100,000 with an interest rate of 5 percent, your monthly payment is $536 per month, locked in for the next 30 years, which is an incredible rate.
2. Properties are still reasonably priced. Yes they have crept up since 2008 but they are still reasonably priced. More likely than not, the number will work — meaning that, after expenses, you get a few dollars that you put in your pocket as profit. If that happens, and the value of the property goes down for whatever reason, do you really care? You are paying the expenses, putting a few dollars in your pocket, your tenants will pay off your property and over time the property value will go up.
1. Low interest rates. My first job out of college back in the 80's was selling vinyl siding door to door and we would try to convince people to use a home equity line of credit — at 18 percent — to pay for the siding. Today, you can probably get a 30-year mortgage on a rental property for under 5 percent (generally there is an additional increase in interest since it is a rental property). So, if you borrow $100,000 with an interest rate of 5 percent, your monthly payment is $536 per month, locked in for the next 30 years, which is an incredible rate.
2. Properties are still reasonably priced. Yes they have crept up since 2008 but they are still reasonably priced. More likely than not, the number will work — meaning that, after expenses, you get a few dollars that you put in your pocket as profit. If that happens, and the value of the property goes down for whatever reason, do you really care? You are paying the expenses, putting a few dollars in your pocket, your tenants will pay off your property and over time the property value will go up.
3.Tax benefits. Never do anything just because you get a tax deduction. Do it because it makes financial sense … AND you get a tax deduction. The depreciation allowance that real estate offers you allows you to get "profit" out of the property, mostly tax free, which is an incredible benefit.
4. You can move your gain into another property. If you own a stock and want to move into another stock, that gain becomes taxable when you sell the stock to move those funds into the new stock. With the use of a 1031 exchange, I can move my gain from one property into another ….TAX FREE!
5. Predictable Income. Income from an investment acct is incredibly unpredictable. For example, assuming that you had $1 million in CD's 5 years ago, you got $50,000 in income…not bad! Now those CD's are renewing at 0.5 percent, so it generated $5,000 — a 95-percent drop in income. Generally, rental income is indexed for inflation and can provide for a great stream of income in retirement
http://www.cnbc.com/id/101614748
4. You can move your gain into another property. If you own a stock and want to move into another stock, that gain becomes taxable when you sell the stock to move those funds into the new stock. With the use of a 1031 exchange, I can move my gain from one property into another ….TAX FREE!
5. Predictable Income. Income from an investment acct is incredibly unpredictable. For example, assuming that you had $1 million in CD's 5 years ago, you got $50,000 in income…not bad! Now those CD's are renewing at 0.5 percent, so it generated $5,000 — a 95-percent drop in income. Generally, rental income is indexed for inflation and can provide for a great stream of income in retirement
http://www.cnbc.com/id/101614748
Monday, May 5, 2014
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