Category: buying real estate

Why most Lenders Use Gross Income instead of Net Income

It might not seem logical that most lenders use your gross monthly income when deciding affordability instead of your net income, the money you actually take home. In the end, it’s the take-home pay you will use for your monthly expenses – this will include your mortgage.

Some Reasons why Lenders use the Gross Income

Foremost, it’s widespread. Most mortgage companies use the gross monthly income to analyse the debt-to-income ratio – and consequently affordability. Like this, everyone is using the same procedure and it is much easier to compare the loan that was offered. Of course, there are exceptions, a few loans do take monthly expenses into consideration.

Another reason is this, it’s a number that most clients know. Calculating the net income with taxes and other deductions is complex and can vary every month. Gross income is steady and easier to calculate monthly. It would be too work intensive for mortgage companies to adjust their loan programs for each person’s exact overheads.

Also, another factor that has to be considered is that when clients are asked to proof their income for their loan application, the last two years of your tax declaration is needed along with recent income statements. The gross amounts on those should align with the documents from your revenue office. As those documents will also show the gross income it is just a lot easier to use those numbers.

Thinking to buy real estate?


If you’re thinking about buying some real estate and want to know what you might qualify for, there are many websites out there where you can get a first idea. Just keep in mind to enter your gross monthly income. By visiting a few you will be able to find out what will be a good option for you.

If you are looking for a real estate bargain, check out our property listings at https://www.all-real-estate.com/property-list/for-sale

You may even be able to find a home that is so cheap that you not even need a mortgage. Does this sound intresting? Then visit our partner site https://www.propertyunder20k.com/ where you can find real estate for sale for less than 20,000 EUR.

Image: Image by Gundula Vogel from Pixabay

From fixer upper to cosy home – 10 practical tips

Fixer upper to cosy home, or better, how to purchase an old, inexpensive, run-down house and turn it into a gorgeous property everybody loves.

It doesn’t matter if you are planning to purchase a fixer upper to turn it into a home for yourself or if you are planning to make some money in the resale afterwards – you will definitely benefit from the following tips to get you through this challenging mission.

Fixer Upper to Cosy Home

The idea is simple, you buy an old building in need of repairs for a great price and a few buckets of paint later it has become a dream home. There are so many tv shows out there where exactly that happens. Of course, it all looks so easy. In reality it is not as simple as it looks. To turn your renovation project into a success lets look at a few areas that need to be considered.

1 Buying the right house

It all starts with picking the right building to start with. The biggest or cheapest real estate is not necessarily the best choice. You have to consider several factors here, especially if you are thinking to sell it after you’re done with it. What are the prices in this location for a home in a good condition? How much will the renovation cost? Is there a lot of demand for houses in this location with this size? To answer these questions, you might need to make a bit of an investigation and talk to a few people. After making all your maths you will see beforehand if it is actually worth it to jump into this venture.

Getting the right project for YOU is the key here. A house that fits in your budget and skills. This is not only the first but the most important decision you need to do.

2 Getting professional help

Unless you are a professional yourself it is always worth it to have some expert by your side to help or to guide you. If you don’t want to get a contractor for the whole job to save some money, you might be able to use him just for some stuff that you find more difficult. This will take some pressure out of you and you can be sure it’ll be a job well done. While you leave those difficult parts to someone else you can concentrate more in the other things that need doing. One thing is for sure, there is always more to do!

A lot of renovation works are not that complicated. It is amazing how quickly one can learn the basics by watching some YouTube tutorials.

3 Planning and Research

With careful planning and some research, you can guide your project in the right direction. This is of course, if you like to make changes to the layout of the house. Best would be to consult with a realtor to see what the clients usually like or dislike. Find out what they have on their wish list and think about a wow-factor you can add to your home. This can make a huge difference in the end.

Just as an example. If your project is in a hot climate, homebuyers might really love to have a pool in their backyard. If you are able to add one for, let’s say 10,000, but in the end, it will make your real estate be worth 20,000 more because of that, it’s totally worth it.

4 Get your hands dirty

You can save a lot of cash if you are working on your own house. There are so many things that are easy enough to do, even if you are not a handy person.

If you belong to this rare specie that can’t even put a nail in the wall, still there are many things you can do. For example, there is always cleaning up to do and often workers can tell you how you can prepare some works for them. This will make their jobs easier and as a result save you some money.

5 Shop around

When it comes to using the right materials for your renovation project it is always worth to shop around for special offers or to find out if the DIY shop offers discounts if you buy a certain amount.

6 Don’t hide – be open about your plans

Keeping an open communication with the neighbours and passers-by is a great way to find a buyer or tenant. Don’t underestimate the power of the word of mouth.

A construction project usually triggers a lot of interest with the neighbours. They all like to know what’s happening and who is going to move there. They might just know the right person who wants to live in your house once its finished.

7 Decorate wisely

When it comes to choose the right colours and decoration it is always good to get a few opinions. Especial value those of people who are usually dealing a lot with home buyers and tenants. Often it is a good choice to keep it simple/neutral and just set a few highlights.

8 Set a budget

When it comes to your budget, be realistic. Doing your maths is one of the biggest challenges and nearly impossible to get it 100% right. Therefore, don’t plan to spend your last penny, always keep a buffer for unexpected costs.

9 Time

When it comes to time, I never met anyone who could stick to a certain time frame when doing his own renovations – except in tv shows. I believe usually time is estimated very optimistic. Therefore, don’t be disappointed if you can’t finish in a certain time frame. Depending on the scale of you project it is always good to give a few days or weeks extra in case something takes more time than expected.

10 Stay positive

Yes, sometimes a positive attitude can make all the difference. Keeping your spirits up can give you the motivation you need to get the job done: turning your fixer upper into a cosy home.

How My House Project Helped Me to Escape the COVID Insanity

While social distancing is strongly encouraged—and you should stay home if you can—you have the time of your life. Or haven’t you?

Articles about how wonderful this time at home is, are popping up like mushrooms in autumn. You hear how you can find new passions and hobbies like painting, reading, baking, cooking etc. It all sounds really lovely, just like great holidays at home. How cool is that!

Expectation vs Reality

Reality sometimes paints a very different picture. While others become master chefs, you might not even have any appetite. Or while others are proud how they have parties in zoom with family and friends you may just wish to be left alone finding this peace you so desperately long for. Seeing all this happy people at home made me wonder, why is it so damn hard for me?

Although I would generally consider myself mentally healthy with a stable family life, I found the new situation very challenging. This was for many different reasons. And that’s it really. Everybody of us is different and copes with this new situation during COVID in a different way.

Keep Yourself Busy with the Right Thing for YOU

One factor for me was that I had not much to do at home where I could really find my inner peace. Being at home with all the family all the time can get on your nerves a little, especially if you weren’t used to it. This is even worst if you have no space to escape to. For example, if you have just one bedroom—of course shared with your spouse—that functions also as office for both of you.

What saved me was something I noticed even before the COVID. It has to do with retired men in my region who worked in construction. Strangely enough, after they retired, they keep seeking work for themselves. They even offer their services at a very low price. I could never understand why—after a life of hard labour—you still want to work more. But now I do.

I have a thing in common with those retired men. I love to work and I always enjoyed working with my hands. Working in construction gives me the feeling that I create something lasting. Also, physical activity is proven to be very beneficial for your mental health.

Physical Activity Is Good for Your Mental Health

When you hear “Physical Activity” the first thing that comes to mind is doing some sport—working out in a gym. But working in construction gives a fair amount of exercise too. Fact is, working hard makes me happy. This gave me an idea. 

My House Project

Fortunately, I live in an area with a number of uninhabited run-down houses in the neighbourhood. Therefore, it was easy to find a cheap house for sale. I was able to buy one for me that I can renovate now in my own time, all by myself. Not only is this incredible rewarding but I can also go there whenever I need some alone time. It has given me a completely new feeling of freedom—something I lost during the COVID.

My house project also helped me to learn lots of new things. Before doing something fresh in the house I always watch some “How to” movies on YouTube. It’s incredible how creative people are. This is definitely contagious.

Not Only a Personal Achievement

My House Project hasn’t gone unnoticed in the neighbourhood. I got a lot of positive feedback from the neighbours. As much as my house project has benefited me personally in this critical time, I’m still looking forward to profit from it financially. Once finished I’m sure I can sell it for a good price.

Looking for your own House Project? Find it on www.all-real-estate.com

Images: (1) Image by Alexas_Fotos from Pixabay (2) Image by 272447 from Pixabay

More Sales – Real Estate Turkey COVID-19

Turkey seems like a good investment for real estate as it is a country where the property and construction sector is very dynamic. Despite the COVID-19 situation we have seen an increase in people looking for houses and apartments for sale in Turkey. This is a good sign.

Seeing that, we made some further investigation on this topic.

Advantages for Foreigners to buying Real Estate in Turkey

Not only is Turkey famous for its breathtaking beaches, outstanding hospitality, yummy foods, and fantastic weather but it comes with a whole bunch of other advantages. If you buy a house in Turkey for at least 250 thousand dollars as a foreigner you and your family will have the right to Turkish citizenship within six months This means, you can do both: make a lucrative investment and become Turkish citizen by purchasing real estate in Turkey. But what really hit many by surprise was the excellent response to the pandemic. For sure this had a huge impact on the positive development regarding the property market.

Real Estate Turkey COVID-19

I read a few articles about how well Turkey handled the COVID-19 crisis. Some measures have proven especially successful with foreign investors who could still enter the country. Starting with a full health insurance for travellers to cover medical costs in case of COVID-19 infection for as little as 25$ up to a web application where you easily can apply for all papers needed when making a property purchase. This makes it easier than ever to travel and shop around for some good real estate in the sun.

Web Tapu

First of all, TAPU is a document confirming the right of ownership to the attained real estate in Turkey. It confirms the transaction and only after it is received you are recognized as the full owner of the Turkish property.

Web Tapu basically means land registry on the web. Here you can apply online for many procedures needed to buy a real estate. This is the best answer to any possible Real Estate Turkey COVID-19 problem.

In the Web Tapu Guide it reads:

“It is now implemented as an electronic system allowing the foreigners, who have a foreigner ID no, to manage their real estate in electronic environment without having to physically visit the directorate of land registry and to apply online for 46 different land registry procedures, such as sale, mortgage and transfer, to send information and documentation necessary for the procedures in safe online environment, to verify their documentation and to authorize third persons or real estate agents for these purposes. Web tapu System will very soon be available in 6 different languages (English, German, Russian, Arabic, French and Spanish). “

Thinking to buy property in Turkey?

Are you looking for your perfect home in the sun, or just a good investment?

You can find real estate for sale in Turkey on: https://www.all-real-estate.com/properties-by-country/turkey

How Homes will change after COVID-19

Homes will change due to the Covid-19 pandemic. We can say this because every pandemic in the past had an impact on our way of living and resulting in a change of the traditional layout of homes.

In this pandemic therefore it is worth to consider how home layouts might change in the future – especially if you are planning to build, renovate or buy a house.

How pandemics have changed house layouts in the past? How pandemics lead to improved living conditions? Let’s look at a few examples.

How homes changed after pandemics

Cholera

Did you know that the Planning for Central Park began in the immediate aftermath of New York’s second cholera outbreak? Frederick Law Olmsted whose first child had died of cholera, was one of its landscape architects. In his writings he often highlights the importance of large open places to allow individuals to breath fresh air, enjoy the sunlight, and in his writings we can read how the air could be ‘disinfected’ by the sun and foliage of the trees. He went on to design more than 100 public parks and recreation grounds all across the US.

The cholera outbreak had an impact in many cities all around the world, especially in the area of developing better sewage systems. By doing so, having an indoor toilet became possible for many households. Yes, you read correctly, the bathroom as we know it today is a fairly recent addition to the traditional home layout.

Tuberculosis

Although Tuberculosis has existed since ancient times it caused widespread public fear in the 19th and early 20th centuries as the illness became common among the city’s poor populations. Many sick people were sent to sanatoriums where – beside a lot of rest, high altitude, and good nutrition – the biggest emphasis was put on a lot of fresh air. Some believe that even modern architecture was inspired by the 20th century obsession with Tuberculosis as the spaces of the sanatorium gave rise to the clean, sleek shapes of modern buildings with big windows for fresh air and sunlight.

Spanish Flu

In the 1918 influenza pandemic the great importance of sunlight and fresh air was also identified. That was the reason why radiator heating became popular in cities after the 1918 pandemic. Especially those that overheat! A lot of emphasis was put on sufficient ventilation to battle disease and this pushed engineers to design steam heating systems – some of them still overheat apartments today – so anybody would still open their windows even on a freezing cold winter day. 

Covid-19

The conclusions we can take from all of the above is that we need to live in a space that is not too big – so we are able to clean it quickly, easy and regularly – at the same time we need sunlight and as much fresh air as possible.

At the same time, we need more space to be able to have a bigger distance between people and to allow enough private space for each individual. Especially if you have children, they need space to play and jump around in case they are not able to go out anymore. A big backyard scores big these days.

How homes will change – What we have seen so far

So far, we can see that buyers look for bigger as well as smaller houses – depending on if they are single people or families. Also, we can see a jump in self-sufficient living – at least partially. People lean more and more in the direction to became a bit less dependent by growing some food in their balconies and backyards, installing solar panels or digging their own well if they can.

Unfortunately, the covid-19 pandemic has complicated our life’s and even traumatised some of us. But it is also a lesson for us to learn how we can improve our way of living. It is thrilling to watch new ways and inventions people come up with to tackle this challenge.

If you are looking for a new home have a look at www.all-real-estate.com. Let us know in the comments below what do you believe would be a great home improvement these days?

Image: Image by Peter H from Pixabay

How to search for your dream home in Las Vegas?

Looking for your fantasy home can be distressing. Finding the perfect home is a fantasy for many individuals, yet not every person knows precisely what they should do to make the cycle as simple as could be expected under the circumstances. For some, the late spring heat harsh, while for a few, the high temps an acceptable tradeoff for different pleasantries Las Vegas has to bring to the table. While it might get hot in Las Vegas, this place is alluring because it is liberated from cyclones, tremors, floods, and severe blizzards — perils in many other warm atmospheres. Look out for homes for sale in Las Vegas.

Regardless of what style you like, you can expect that majority of the homes will be proprietor-involved. The purchasers can expect that those homes they will be visiting will be fit as a fiddle as the city encountered a surge of several buildings being structured in 2018. There are a lot of opportunities for new construction accordingly. 

You will likewise see another style pattern: the classic stone ledges, travertine, and wood cupboards that once embellished the Las Vegas home are gone, supplanted by white quartz ledges and dark ground surface. There isn’t a house in Las Vegas that doesn’t have these components, and the exciting part is that individuals will be on to the following pattern in five years. 

Las Vegas contains an enormous number of gated networks, which implies purchasers need arrangements to see the homes available to be purchased. If you are hoping to buy homes for sale in Las Vegas, these are a few hints that you can use to make the cycle straightforward. Thus, you can locate the perfect home for you. 

Do some research:

Before you choose LA as an ideal spot for you to move, you should take an opportunity to explore the area. You need to ensure that it fits inside your lifestyle and that you will be glad there. It’s a smart option to look at the things that are in the area to guarantee that you will have all that you will require. You should investigate a portion of the specific neighborhoods to locate the one you like best from that point. You may even need to converse with a couple of individuals that live there to discover what they like about the area. 

Think about Your Drive Time: 

Before you pick the correct neighborhood, you should consider how long it will take for you to drive to your work. This relies upon where your office is, if by any means, and how much longer you will work. Your drive is a significant aspect of your day, so it is imperative to take this into account when you are picking the correct area. Fortunately, Summerlin isn’t a long way from many significant areas, including Southwest Las Vegas AND Henderson.  

Take a Glance at A few Homes: 

You would prefer not to pick the first home that you have visited. You may cherish it, yet you should, at present, take an opportunity to see different homes to ensure you locate the ideal one for you. The first one which you visit is not ideally going to be perfect one; however, if you conclude that it is after seeing a few homes, at that point, you can like to create an offer and realizing that it is the right home for you. There are many different sorts of homes in LA, so you should take an opportunity to see multiple or two. 

What’s your budget?

When you are looking to buy a home, you would prefer not to extend your financial plan and make it difficult for you to make the most of your life there once you move. You should just view homes that are in your spending range. With Las Vegas near to, you won’t have any desire to be not able to appreciate the area basically because you bought a home that was past your financial plan. There are endless homes accessible at different value goes that you should have the option to locate the perfect one that meets your spending plan. 

Conclusion:

LA is a great spot for living. There are many exciting things about the area, and it is near stunning schools, safe neighborhoods, plenty of openings for work, and top-notch feasting and amusement that you can appreciate. Take your time finding the right home for you with these tips, and you will be glad in LA for quite a long time to come. For help finding the perfect home, make sure to contact your neighborhood LA Real estate professionals.  Remember that you aren’t going to buy a home multiple times, so dig deep, do your research and pick the right one that suits your budget and comfort too.

Author: Eernesto T Felder

Working from home? No, working from Paradise!

Working from home has become the new reality for many of us in the past year. Many found themselves in this very new and – no doubt – challenging situation. Depending on the circumstances of each individual it could mean to either be alone at home or to find a quiet corner in your busy family home. Both situations come with their very own set of problems as well as advantages.

I found myself in the second scenario. The bedroom became my office as well as my husbands’. In each video conference we hoped none of our children would storm in to scream out the latest mischief one of her siblings did… To tell a long story short: I believe many of us homeworkers wished for better working conditions.

Buy a covid friendly home

Buying a new home that better suits our needs in this time definitely crossed our mind. Looking at all the complications though, made us soon realize that it does not seem to be a good time for that, not just yet.

I saw many articles popping up about covid friendly homes – meaning it is NOT friendly to the actual covid virus but rather helps people to live with the new situation. There is a lot of speculation going on how such a home would look like.

Others might also suggest that soon there will be a vaccine and everything will be back to normal again – just like the time before the outbreak of the coronavirus.

Another thing to consider is that your house might not be worth what it used to be due to the financial impact the pandemic had on the real estate market.

Therefore, it might be a hasty move to sell your home and get another right now.

What you can do

Many people did not go on their annual holidays abroad this year out of fear or due to complications, such as needing to be quarantined when they return to their home country. But what if you would get the chance to combine your holidays with your new working from home situation?

Speaking with many who worked from home even before the spread of the covid, you can be free to choose where you like to live. This is fantastic. I know some who choose really nice places where real estate is very cheap. They were able to keep their costs of living down and at the same time live in a great location.

If you like to get an idea where it would be very cheap to buy a house have a look at this map:

https://www.propertyunder50k.com/map_view.php?

Paradise Guaranteed

I recently came across the Barbados Welcome Stamp – basically it is a special visa for remote workers who want to work and live in Barbados for 12 months. So, if you are looking for a change and you like to try another country for a year why not have a look?

Looking to buy, sell rent real estate? Visit www.all-real-estate.com

5 Ways to Begin Investing In Real Estate with Little or No Money

Lots of folks believe this to enter the world of property; you require plenty of money. But it doesn’t imply that a person with less or no cash can’t begin a real estate company. In This article we have covered the full topic of – how to do real estate business with no money?

The first thing required to initiate a real estate company (or any business, really) is the ideal mindset. You will need to work out creative and innovative ways of getting financing for your real estate deal, especially when you’ve got no funds to spend.

A business is successful once you earn profit by selling your goods or services. This is true for the real estate business, also. The best thing about the property sector is that everyone can start this business with the wish to sell the property and earn high returns.

So, how can you begin a real estate company with zero capital? How can you organize financing to back up your real-estate deal?

If these questions are running through your head, then we have got helpful answers for you.

How to Make Money in Real Estate Without a License

Real estate is an exciting business. I have met a few of the most driven and enthusiastic individuals, lots of whom are currently lifelong buddies. It keeps you on your feet! When most folks consider transitioning to a career in real estate, but the first thing that comes to mind is becoming a certified realtor. With all the licensing and education requirements, however, that may seem quite daunting. Many don’t understand that you may work in real estate without a license in most countries. In actuality, a quick scan of the internet job boards shows the assortment of opportunities.

How to Start a Real Estate Business with No Money

Here Are Five Powerful ways to start a property dealing Company (How to do real estate business with no money) with zero Cash in your pocket, Plans you can learn from and apply in other businesses as well:

1. Buy a House as a Main Home

You can buy a house to live in with a zero money down VA or USDA loan, remain there for at least one year, then move out and turn the house into a rental home. Do not forget that equity building through property investing also contains the houses where you live. Additionally, the down payment and credit rating requirements for a primary residence are always less strict compared to investment property. Living on your insignificant farms first is an excellent way to avoid the more rigorous lender rules for property investment properties.

2. Purchase a Duplex, and Reside in 1 Unit while You Rent Out another One

Did you know that you could fund a two-unit duplex using an FHA loan? You reside in one unit and rent out the other property for additional cash. Along with the reduced down payment requirement, the best thing about this property investing strategy is the lease you derive from the opposite side of this duplex will most likely play a significant part of your mortgage!

3. Create a HELOC (Home Equity Line of Credit) on Your Primary Residence or another Investment Property. 

For those who have a large quantity of equity on your primary residence or another property rental property. Many banks will provide you with a HELOC, which you can then use for property investing. A normal HELOC will make a line of money in hand for around 70-80% of the instant equity in your currently owned land.

However, the HELOC can also be utilized as a zero-down mortgage to fund a rental property.

The HELOC interest rate is generally the prime rate and 1 or 2%, which now puts them around 5 percent. But the principal benefit of the HELOC is that it usually does not have any closing costs, and you’ll be able to close quickly with only a Drive-By evaluation on your premises. Some banks won’t charge you for this particular examination.

By way of instance, if the interest is $300, you can simply pay that minimum amount, or pay extra money each month to repay the principal. This permits you to make your mortgage under your terms.

Assuming the prime rate stays stable, the total amount of interest will fall as you pay down the principal monthly.

4. Ask the Seller to Pay your Closing Costs.

On many property transactions, the property seller is willing to cover buyer closing costs to incentivize a sale. However, the trade-off will most likely have to supply the full asking price or close to it. This is reasonable, so long as your lease is enough to cover all your expenses and give you little monthly cash flow. However, at full asking price in the event, the lender quotes you an entire mortgage payment (including insurance and taxes ). Which is equal to or higher than the lease you can reasonably cost, search for another deal.

5. Utilize a Bank that Pays Closing Costs or Supplies a Rebate on your Down Payment.

In combination with Freddie Mac’s Home Possible Advantage program, Quicken Loans has just promoted a 1% down payment option on single-family houses for owner-occupied properties. The buyer puts up 1 percent, and Quicken Loans provides a grant for another 2% needed. A 680 credit rating and a debt-to-income ratio of 45 percent or less will be required.

Sometimes the interest rate is slightly higher to get this deal, but some lenders are currently advertising. They’ll pay closing costs without increasing interest rates. Check with a site such as bankrate.com or do a Google search for a listing of those companies.

Whichever of these methods you opt to use, the most crucial point to bear in mind is that investing in real estate with very little money is a superb way to build wealth. It is among the very few investment approaches where you can begin without large quantities of cash. One never knows when particular property programs will come and go. So make sure to benefit from these ideas while they’re still around.

Is real estate an excellent way to earn money in 2020?

Real estate is best regarded as a long-term investment – it pays off best when held through the years. You can purchase property in 2020, but you would want to hold onto it for 20–30 years for the best results. Suppose you can find sellers that will sell their property for you at a substantial discount below market value. In that case, you can create a whole lot of cash in a couple of weeks through wholesaling or flipping. But finding people who will sell the property to you for 10–20 percent or more below market value is a whole lot tougher than finding quality properties that will appreciate and supply decent cash flow over the longer term.

How to Start Investing in Real Estate with Little Money

For many people, the term “investing” conjures up images of men in suits, tracking the exchange of tens of thousands of dollars on a stock ticker.

I am here to tell you: You do not have to be the Wolf of Wall Street to begin investing. It’s okay if you are more of a mouse of Main Street. Even if you just have a few bucks to spare, your money will grow with compound interest.

The key to building wealth is developing good habits–such as regularly putting money away each month. Replace the barista-made cappuccinos for coffee in your home, and you may already be saving more than $50 per month.

As soon as you have a little cash to play, you may begin to invest.

It’s just as straightforward. Having a robo-advisor or savings account, you can make your money work as you play. With a stock trading program, you can play a little money and learn valuable investing lessons simultaneously. Exactly like Halloween costumes, investing comes in several diverse forms. It should not be a scary word.

With so many diverse choices, investing for novices is more straightforward and more uncomplicated than ever before.

Conclusion

Property coping is a very profitable business. Use the ways mentioned above to enter this line of business even when you don’t have cash. But, do not forget that entry is simply the first step on the ladder of success. How your company grows and succeeds is mainly based on your hard work and your ability to recognize opportunities and take action accordingly.

Ready to begin taking advantage of the current opportunities in the housing market?

Whether you are new to investing or have closed a few bargains. Our new online property course will cover everything you will need to know to help you start real estate investing. Professional investor than Merrill explains the very best property plans to help get you on the path towards a better financial future.

About the author: My name is King kentus i blog at komback.com and i am the CEO of the said website.

Renting vs Buying: What to Consider

Buying a house is the pinnacle of success—or, at least it used to be. It seems as though more and more people are abandoning the popular dream of homeownership and setting their sights on financial accomplishments that are more realistically attainable, like luxury vehicles, designer watches, and worldly travels.

That’s not to say purchasing a property is entirely off the table, though. There are plenty of affordable properties under 20k that you could buy without sending yourself into debt for several decades. There are two sides to every coin, but ultimately, there’s no single “correct” answer—it all comes down to your personal priorities. If you’re debating renting vs buying, consider these points to help you decide which option suits you best.

What’s on your time horizon?

If you’re thinking about buying a house, make sure to consider your timeline in two to 10 years from now. Will you be in the same city? Have the same job? Are you ready to settle down?

The people who like to rent are usually those that value flexibility and mobility; they don’t want to be tied down to a 15- or 30-year mortgage that locks them into one location. Of course, life happens and plans can always change, but if you have to sell your home shortly after buying it in order to move to a new city or place your child in a better school district, for example, you could lose money on your initial investment.

Bottom line: Purchasing a home is an investment in your future, but it’s a long play that will require you to live in the same place for at least two years. Just like any investment, there’s risk involved should the real estate market crash and you owe more on the property than what it’s worth.

How is your credit looking?

You’ll need a positive credit history whether you’re applying to rent or buy a house, but it’s much more important in the case of the latter. Most of the time, homeowners rely on financing to purchase a property; it’s pretty rare for someone to have a few hundred thousand sitting around in cash that they can use to complete the sale in one fell swoop.

Lenders will look at several things when reviewing your mortgage loan application, including your age and income, but credit history is one of the most important qualifiers. Not only do you need a strong credit score to finance a house, but it’s in your best interest to take the time to increase your score as high as possible in order to receive low rates.

A good number demonstrates less perceived risk, so the lender will be likelier to charge less interest on top of the principal balance—saving you a significant amount of money in total borrowing costs in the long run.

Bottom line: If you’ve missed a few bill payments in the past and are sitting on mismanaged debt, you should clean up your credit history before trying to buy a home.

Do you have money saved up?

One of the biggest differentiators between renters and buyers is the money they have saved up in the bank. Even with approved financing, you’ll need to place a sizable down payment—or, the portion of the purchase price that you pay upfront in cash—to show the lender you’re invested in the property and likely to repay the loan.

Many people think they need a down payment of at least 20% of the total price in order to buy a home, but that conventional wisdom doesn’t apply much today. While it’s true that a 20% down payment can help you avoid private mortgage insurance and save you tens of thousands of dollars in the long run, this barrier to entry is pretty steep for first-time buyers.

You can buy a home with anywhere between 5-15% down upfront, and there are also down payment assistance programs that can help you come up with the cash. Renting will also require a down payment, security deposit, and money on-hand for application fees, but these costs are usually cheaper than a mortgage and its affiliated costs.

What many people fail to realize, though, is that every rent payment they make likely goes toward paying off the landlord’s mortgage, and the price comparison isn’t that far apart. For example, if rent costs a thousand per month, a mortgage payment might be only 15% more. Rather than throwing that money down the drain on rent, those funds could be better applied to building your own wealth in home equity and increasing your net worth. You could also look into rent-to-buy homes in your area that can help you achieve the best of both worlds.

Bottom line: You’ll need to budget and save up for a home, which often leads people to stick with rent that’s easier to afford while keeping up with the cost of living—but putting in the work can pay off tenfold if you apply the cost of rent toward a tangible asset that you eventually own over time.

Are you financially responsible?

When you buy a home, the hard work doesn’t end once you get the keys in your hand. There are a lot of ongoing costs that you’ll need to keep up with, such as property taxes and maintenance repairs. And, whereas a renter could simply call up the property manager to fix a leaking sink, that responsibility will fall on you to repair yourself—unless you prefer to pay someone to do it for you.

Bottom line: If you don’t want to deal with the hassle of property maintenance and the ongoing costs of homeownership, it might be better to rent so you know exactly how much money to budget every month.

Do you have competing goals?

Finally, check in with your financial goals to see if there are competing priorities. Let’s say you just graduated from college; would you rather pay off your student loans or invest in the real estate market? Do you need a down payment to purchase a new vehicle?

Bottom line: It can be challenging to pay off debt or save money when owning a home, so consider your financial goals and decide what to accomplish first.

By keeping these thoughts in mind as you compare renting vs buying, you’ll be more likely to make the right decision for your financial future.

Samantha Rupp

Samantha Rupp holds a Bachelor of Science in Business Administration and is the managing editor for 365businesstips.com. She lives in San Diego, California and enjoys spending time on the beach, reading up on current industry trends, and traveling.

How and Where to Invest in Real Estate: The 4 Best Ways to Profit

It’s not a secret that real estate can yield bigger profits than most businesses, but did you know that you can earn in this market even if you don’t sell a house?

If you have ever experienced having a landlord, there’s a good chance that you have observed how challenging it is for them to field calls from tenants all day about overflowing toilets or giant bugs. But while it may not seem like the most glamorous job, being a real estate investor can be quite lucrative.

Aside from renting out a place, there are plenty of ways that you can get a significant return on investment in real estate. The only problem is that not all investors understand how they can do so, or even know which investments can get them a significant ROI.

If you’re new to the trade, this article is for you. Read on to learn the four best ways to profit by investing in real estate.

1.   Buy a rental property

This is probably the most straightforward method of becoming a real estate investor. ‘Investment property’ refers to any commercial or residential property to be rented out to tenants without any additional fixing or flipping.

When you own a rental property, you don’t just get what you paid for, but you also build wealth-generating income. Add to that equity appreciation and the leverage you have with real estate, and you have yourself a solid investment.

Still, it is worth noting that owning a piece of rental property may not be for everyone. When looking for houses or apartments for sale, you have to make sure that you consider your interests, lifestyle, and the potential drawbacks, including:

●      Time commitment

Owning a property and renting it out to tenants requires time, even with the help of a property management agency. Make sure that you can accommodate this in your schedule. Otherwise, it would be best to try something else.

●      Cost barriers

Another major concern most investors have about a rental property is the cost of buying one. If you’re taking out a loan for it, many lenders require a minimum of 25 percent down payment for an investment property loan. Thus, it would be better to consider undertaking this type of real estate venture if you have reserves worth several months’ expenses.

●      Uncertainty of yield

Although many rental properties provide a continuous source of income for many (especially if you pick an apartment in a highly desirable location, like a Business Bay property in Dubai, for example), it isn’t a 100% done deal. Vacancies can happen, and things may break. Although there is great potential in this sort of investment overall, there are considerable short-term risks.

2.   Invest in real estate investment trusts (REITs)

Real estate investment trusts or REITs allow investors to put in their money and let it grow without actual, physical real estate.

Although usually compared to mutual funds, REITs are actual commercial real estate properties like retail spaces, office buildings, apartments, and hotels that yield income through leasing. The revenue gathered through these properties is divided amongst the REIT holders – also called ‘trustees’ – in the form of a dividend, which they can automatically reinvest to allow it to grow further.

But while REITs are an excellent way to invest in real estate for people without the time to handle rental properties, they can also be complex and varied. Some of these are traded on an exchange the same way stocks are, but others aren’t publicly traded. This means that the kind of REIT you invest in is a huge factor in how big a risk you’re taking when engaging in this form of real estate investment.

3.   Purchase a vacation rental

Vacation rentals are quite different from the rental property mentioned previously. While the latter involves having long-term tenants, vacation rentals are only occupied by tenants on occasion.

One of the perks of having this type of investment property is that you can use it as your second home when it is vacant. It would also be easier to finance vacation rentals compared to long-term rental properties, particularly if your lender considers it your second home as it means you don’t need to use the rental income to qualify for the loan.

Moreover, these properties usually bring in higher rental income per day compared to long-term rentals.

But, like other investment options, vacation rentals also have some disadvantages.

For one, marketing and managing this type of rental property requires more involvement on your part compared to those leased out long term. Because of this, the cost of property management is a bit higher, with many property managers expecting to get paid 25% of the total rent. This is more than twice the 10% standard for long-term rentals.

4.   Fix and flip real estate

If you’re a fan of real estate TV shows, then you’re probably familiar with the term ‘fix and flip’ or the act of ‘flipping houses’. Fixing and flipping a property means that you buy a home for the sole purpose of refurbishing it and selling it quickly for a profit.

This particular investment option can be quite a lucrative option in real estate, especially if everything proceeds as planned. After all, what better way to earn some cash than by buying an underpriced home, showing it little love through inexpensive renovation, and reselling it for a higher price?

However, this strategy is a little bit harder to accomplish in reality compared to how they present it on TV. First, it comes with a higher risk as the maths behind flipping properties means you have to be very accurate in your estimated cost of repairs. That alone is a challenge in itself.

Plus, flipping homes is a job that requires not only your attention but a lot of time as well. This means that if you’re a passive investor, you should consider another investment option.

Remember that fix-and-flip investments can be quite daunting, even for the most experienced professionals. In fact, even the people you see doing this on TV require a team of four people or more, with varying expertise in real estate marketing, civil engineering, interior design, and others.

There are also some rules you must know about before deciding to jump into the fix-and-flip bandwagon:

  • You make money when you buy, not when you sell. Stick to the 70 percent rule; the acquisition, repair, and holding costs shouldn’t exceed 70 percent of the amount you expect to sell it for.
  • Time is equivalent to money in this trade. Dragging your feet during repairs and selling can destroy your profit margins.

Invest wisely in property

Property investment has a high potential of helping you build your wealth. When done right, you can even make it your main source of income.

Still, it would be best not to put all your eggs in one basket. Invest wisely by choosing the right kind of real estate investment among those listed in this article.

Author: Damac Properties