real estate

Moving For Love

February 14, 2020 by Team RE Mentor Leave a Comment

-Moving For Love-

Consumers are willing to move—even more than 500 miles–in order to be with a significant other. And the move tends to be worth it, according to a survey by Bellhops, a professional moving company. Bellhops analyzed nearly 2 million online conversations in the U.S. from June 2018 to March 2019 to find themes in moving. “Moving for love” was among those themes they found.

Sixty percent of the people whose conversations involved moving for love are now married or in a long-term relationship, the study showed. Women are more likely to move for love than men.

One-third of the people who moved for love did so more than once too. Fifty-seven percent said they’d do it again, if necessary too.

Americans are willing to move long distances to be with their significant others—44% moved 500 miles or more for love, the study found.

For those who move, the majority rent an apartment. But 25% are so confident in their choice that they skip renting and buy a home in their new location once they move, according to the survey.

Source: “The State of Moving,” Bellhops (2020)

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Their Plan To Building A Legacy Through Real Estate

February 12, 2020 by Team RE Mentor Leave a Comment

Their Plan To Building A Legacy Through Real Estate

Sherry and Laird describe why they came to the Ultimate Partnering Event and how the event surpasses their expectations. They share what their biggest fear was when it comes to investing in multi-family real estate and how they overcame it. Sherry and Laird tell you why they have a favorite training from RE Mentor and what RE Mentor means to them. They offer advice for anyone who is on the fence about getting started investing in real estate. ____________________________________________

“The Nibble”

February 1, 2020 by Team RE Mentor Leave a Comment

Webster’s Dictionary would define the word “nibble” as “a small bite”, but to the person buying something, a nibble is a bit different. To a buyer, a nibble is a conscious or unconscious effort to get the seller to take less, and is usually the last effort to get just a little bit more taken off of the asking price. – Real Estate Club

The Nibble is a negotiating tactic.

Once you have the deal signed and finalized, if anything surfaces that you weren’t aware of prior to the signing of the contracts, ask the seller for a credit at closing. This information often surfaces after the property inspections, when you receive your Due Diligence verification back.

The most common Nibble

is actually the repair allowance we just spoke of. If there are additional repairs that you were not aware of prior to negotiating the sale of the property, ask the seller for a credit.

Other common Nibbles:

Maybe the rents aren’t as high as the seller stated, or perhaps some of the expenses are higher than you were told. Since your offer was based on the information given to you by the seller, you have the right to go back and get a credit for the difference.

Beware, though.

The reason it’s called a Nibble is that you’re asking for small items, one at a time, nibbling away at the deal. If the seller agrees to each, you may end up with quite a bit. You aren’t asking for anything unreasonable. You’re asking for an amount that may be an inconvenience, but not a deal-breaker.

Nibbles are done after the seller is tied to the deal.

The further along you are in the negotiating process before you request these credits, the more likely the seller will agree. The seller already has plans for his proceeds and just wants to close the deal.

Don’t get too greedy, though.

If you’ve got a good deal, take care in handling your Nibbles. Don’t lose the war because you wanted to win the battle.

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5 Signs Of A Real Estate Market

January 22, 2020 by Team RE Mentor Leave a Comment

1. Local government funding

A hefty amount of dollars spent by the local government on local development is a sure sign of the revitalization and further development of an area which means that real estate is about to take off in terms of supply and demand.

2. A jump in commercial funding

The relocation of large businesses, the opening up of offices and an influx of new business in an area is also a clear indication that domestic real estate will take off as all those workers, office personnel and managers will need somewhere to live.

3. Expansion of local transportation

An upgrade of the local transport grid, local transport network and or building of new access routes is an indication of the revitalization of an area.

4. A rise in the local population

An influx of new visitors, a rise in the number of 'out of towners' and a jump in the people who normally live in an area is a sign that the particular market is about to become a real estate hot spot.

5. A rise in investment projects

Any jump in investment projects or any large-scale investment in an area, even if it has nothing to do with real estate is one of the signals that the area is about to become a hotbed of real estate activity and you had better get in there fast.

Want to learn more about real estate markets? Go here.

3 Ways To Determine The Value Of An Apartment Building

December 6, 2019 by Team RE Mentor 1 Comment

There are three ways to determine the value of an apartment building:

Replacement Cost Approach
Sales Comparison Approach
Income Approach

Replacement Cost Approach

The Replacement Cost Approach determines value by calculating how much it would cost to replace an existing structure. This approach is very time consuming to complete as you must obtain pricing for all materials (from 2×4’s to outlet covers) used in the construction of a property and then calculate replacement cost. Because of this, it is very rarely used.

Sales Comparison Approach

For single-family houses and 2 – 6 unit apartment buildings, the most common approach to determining value is the Sales Comparison Approach. This approach compares similar properties that have sold within the last six months, within a certain geographical radius from the subject property (usually no more than two miles, the closer the better) to determine value.

If you’re buying a 3-family apartment and a similar one on the next block oversold for $220,000, then your property will be valued around that area.

The Income Approach

For six units and more, you would use the Income Approac h to determine the value of the property. This means that you would determine how much income the property is generating and determine its value based on that number.

There are several formulas that investors use to determine value, though one is more prevalent than others; that is the Cap Rate.

You’ll hear people talk about the “Cap Rate.” It’s what most investors use when comparing one property to another.

The Capitalization Rate is the rate at which the Net Operating Income (the income that is left over after all the expenses are taken out) repays the purchase price on an annual basis. Sounds technical, doesn’t it? Don’t let it scare you.

Cap Rate = Net Operating Income/Value (selling price)

Allowing Your Real Estate Business to Run Your Life

October 9, 2019 by Team RE Mentor 1 Comment

We all get so wrapped up in the thrill of real estate investing (once you start buying, selling and cashing those big checks you will know what I’m talking about), that it begins to become all-encompassing. We have cell phones, so we don’t miss a call. When the phone rings at our home office we go running like a bat out of hell from the dinner table because this could be the Next Big Deal.

We take calls from contractors and suppliers at all hours and somehow especially on Sunday nights. We allow tenants to have us at their beck-and-call because we fear that if we don’t say “how high” when they say “jump”, they might move out.

Before we know it, our lives are consumed with nothing else. We left our jobs so that we could stop working for The Man, and be our own boss. Now we’ve come to realize that we are working for a much worse boss, a tyrant. That tyrant is ourselves.

How does this happen? It happens because we don’t effectively plan our businesses. I talked about planning earlier in this report. One of the benefits you will achieve from planning is you will be able to create systems and checklists to control your real estate investing business.

Once these systems and checklists are in place, you will know what needs to be done in any situation. You will look at the checklist daily, to review what has been accomplished and what still needs to be done.

You should have checklists for every aspect of your business. Here are some key checklists:

Property Evaluation: Buying right, market analysis, property analysis
Property Inspection: Estimating repairs, formula worksheets, room-by-room analysis
Contractor Management: Bid process, contracts, and agreements
Renovation Management: Cash flow, required activities, scheduling, and contractor management
Tenant Management: Application process, move-in process, leases, and contracts

These are just a few of the many checklists and systems that you’ll need to create and use on a day-to-day basis. Then you’ll be running your business and your business will not be running you.

One of the benefits of systems and checklists is that—as you grow your business and hire people to work for you—you’ll train them by teaching them how to use the checklists and systems. You will train them to complete the tasks associated with each system and checklist. You will supervise them by revising the systems and checklists that they are working on.

This is the fastest way to grow your business.

To get help on systematizing your business, read this book, The Multi-Family Manifesto. It’s a great book that will teach you how to look at your business in its proper perspective.

If you don’t want to create all of those systems and checklists yourself, find someone who already has a successful real estate investing business and find out what they are using. The sooner you systematize, the sooner you will be free to make choices based on what you want to do, instead of what your business needs you to do.