There are countless Real Estate Programs that claim to teach you how to flip properties with little to no money and no credit. They advertise that you don’t need any money in the transactions and that you need no prior experience or education. To make matters worse, the market is flooded with hundreds of 'wanna-be real estate mentors', so-called real estate coaches and 'house flipping gurus' popping up everywhere. Are all these so called experts right or are they just trying to sell you something?
Well, I didn’t start this business with putting down large down payments. I had great credit but because I wasn’t begging the banks for loans, I didn’t need credit. I started this business learning how to control property instead of buying property. So nobody can tell me that you can’t get started without money, credit, or experience.
There are numerous ways to build wealth in real estate and the market is flooded with various strategies, techniques and systems. People tend to get so overwhelmed with this that they become completely confused with what to do and where to start. You end up buying the next big real estate program, attend free webinars, join real estate clubs and visit free 90 minute seminars. You eventually either become believing that the experts real estate program will fix all of your problems or you become skeptical that it could work for you. You become so immersed with so much information that you become very confused. What’s the solution?
I have one simple answer:
You must learn the 5 fundamental real estate strategies of wholesaling, retailing, lease-options, straight options and seller financing before you can build any wealth in real estate. But I never have a student try to become an expert at all 5 real estate methods starting off. I recommend that you focus on one or two strategies and become really good at that. So before you invest into a real estate program, make sure that you start off with one of the 5 real estate methods mentioned above. As you build more experience by closing deals, start learning another strategy, ultimately learning all 5 real estate methods that will ensure a long term career.
Monday, April 18, 2011
Friday, April 15, 2011
Real Estate Investor Websites
To be a successful real estate investor today, you must be aware of the new technology especially when it comes to the Internet. As the Internet presence grows, so do the amount of resources you can use to grow your business. Using these resources can help educate you, save you time, and expose your business to a lot of people. Now, there are many real estate investor websites out there, but how reliable are they?
One of my favorite real estate investor websites is www.zillow.com, but you must understand how to use it before you say the numbers are off. This site will give you a lot of information including property values, location and similar sales. I’ve asked a lot of real estate investors out there what they thought about this site and most of them have told me that the numbers were off, so they stopped using it. This was sad to hear because just like any tool, you must learn how to use it before you can see results. Lets review some of the basics for www.zillow.com.
Real estate investor websites like www.zillow.com use the cost per square foot sold to give property values. The more homes sold, the more accurate the numbers will be. Let me give you an example of what I mean.
You want to determine the average cost per sqft. Pull similar sales from www.zillow.com. Remember, the similar sales properties need to be similar to the potential property. The same square foot, bedrooms, baths, location, and date sold. Don’t pull similar sales from 6 months ago as the market seems to change on a monthly basis.
Take 4 Similar Sales (Minimum)
Comp 1 – Sold Price divided by Square Foot = Sold price per square foot
Comp 2 – Sold Price divided by Square Foot = Sold price per square foot
Comp 3 – Sold Price divided by Square Foot = Sold price per square foot
Comp 4 – Sold Price divided by Square Foot = Sold price per square foot
Take these 4 numbers (Sold price per square foot) and add all 4 numbers. Then divide these numbers by the total amount of comps (In this example 4) This gives you the average cost per square foot sold. Then multiply this number by the total square feet of the potential property your interested in. This should give you the after repaired value (ARV) for that property. Now, there are several real estate investor websites online that can help you determine your after repaired value. We are using www.zillow.com as an example for this article. You can google many of these sites but keep in mind that determining the ARV is the most important number when calculating an offer. The ARV is what the home should sell for when you are ready to sell it. So you must know what it’s worth before you buy it. You make your money when you buy and realize your profit when you sell. Never forget this!
Now you may be thinking that these similar sales are off. They could be? Let’s say that back in 2005 these homes sold for $500K and there have been no sales since then. Zillow.com would say that the homes are still worth $500K because nothing has told it differently. On the other hand, lets say there have been some foreclosure sales, then zillow.com would adjust those numbers which could bring down the values. Zillow.com also takes a radius of homes so if there are condos across the street, these values may lower the values. Always be sure that you are pulling the properties that are similar so you will have the most accurate numbers to determine the properties value.
Here are some tips when working with real estate investor websites:
• Never rely on any one source, use multiple sites and compare.
• Only pull the similar sales of homes that are comparable as far as size, style, bedrooms, baths, lot size, date sold and location.
• Use a minimum of 4 similar sales when calculating property values.
• The After Repaired Value (ARV) is the most important number when determining an offer.
• Use the Internet for resources to help start and grow your business.
• Use these guidelines for any real estate investor website.
Pulling property values are extremely important in order to make an intelligent offer. You can always use a Realtor for these numbers, which may be more accurate because most homes sold, are sold through the multiple listing service (MLS). You can also use real estate investor websites to find tax values, power team members, owners phone numbers, repair costs, business plans, marketing idea’s and education. So create a bookmark with your favorite sites and start exploring all of the resources available at your fingertips.
One of my favorite real estate investor websites is www.zillow.com, but you must understand how to use it before you say the numbers are off. This site will give you a lot of information including property values, location and similar sales. I’ve asked a lot of real estate investors out there what they thought about this site and most of them have told me that the numbers were off, so they stopped using it. This was sad to hear because just like any tool, you must learn how to use it before you can see results. Lets review some of the basics for www.zillow.com.
Real estate investor websites like www.zillow.com use the cost per square foot sold to give property values. The more homes sold, the more accurate the numbers will be. Let me give you an example of what I mean.
You want to determine the average cost per sqft. Pull similar sales from www.zillow.com. Remember, the similar sales properties need to be similar to the potential property. The same square foot, bedrooms, baths, location, and date sold. Don’t pull similar sales from 6 months ago as the market seems to change on a monthly basis.
Take 4 Similar Sales (Minimum)
Comp 1 – Sold Price divided by Square Foot = Sold price per square foot
Comp 2 – Sold Price divided by Square Foot = Sold price per square foot
Comp 3 – Sold Price divided by Square Foot = Sold price per square foot
Comp 4 – Sold Price divided by Square Foot = Sold price per square foot
Take these 4 numbers (Sold price per square foot) and add all 4 numbers. Then divide these numbers by the total amount of comps (In this example 4) This gives you the average cost per square foot sold. Then multiply this number by the total square feet of the potential property your interested in. This should give you the after repaired value (ARV) for that property. Now, there are several real estate investor websites online that can help you determine your after repaired value. We are using www.zillow.com as an example for this article. You can google many of these sites but keep in mind that determining the ARV is the most important number when calculating an offer. The ARV is what the home should sell for when you are ready to sell it. So you must know what it’s worth before you buy it. You make your money when you buy and realize your profit when you sell. Never forget this!
Now you may be thinking that these similar sales are off. They could be? Let’s say that back in 2005 these homes sold for $500K and there have been no sales since then. Zillow.com would say that the homes are still worth $500K because nothing has told it differently. On the other hand, lets say there have been some foreclosure sales, then zillow.com would adjust those numbers which could bring down the values. Zillow.com also takes a radius of homes so if there are condos across the street, these values may lower the values. Always be sure that you are pulling the properties that are similar so you will have the most accurate numbers to determine the properties value.
Here are some tips when working with real estate investor websites:
• Never rely on any one source, use multiple sites and compare.
• Only pull the similar sales of homes that are comparable as far as size, style, bedrooms, baths, lot size, date sold and location.
• Use a minimum of 4 similar sales when calculating property values.
• The After Repaired Value (ARV) is the most important number when determining an offer.
• Use the Internet for resources to help start and grow your business.
• Use these guidelines for any real estate investor website.
Pulling property values are extremely important in order to make an intelligent offer. You can always use a Realtor for these numbers, which may be more accurate because most homes sold, are sold through the multiple listing service (MLS). You can also use real estate investor websites to find tax values, power team members, owners phone numbers, repair costs, business plans, marketing idea’s and education. So create a bookmark with your favorite sites and start exploring all of the resources available at your fingertips.
Tuesday, April 12, 2011
Real Estate Tips
A great real estate tip is to start working with the for sale by owners (FSBO). People that have For Sale By Owner (FSBO”S) signs in their front yard are just simply trying to save money by not hiring a Realtor to sell it. These people usually have had bad experiences with Realtors in the past. They would rather try to sell the property themselves and save money.
Dealing with these owners is usually easier than dealing with Realtors. We have seen many times when we make an offer to a Realtor; they never present it to the owner. Some of the offers we make are low and the Realtor knows if the owner accepts our offer that they will not make their commission. The positive side of dealing with FSBO”S is that we can find out their situation and offer them several different ways to solve their problem. Here’s another great real estate tip, create multiple solutions (offers) will increase your acceptance ratio of accepted offers. More accepted offers, the more money you will make.
The most important thing you can find out about the seller is to ask what their situation is. Do you need all cash today? Are you moving soon? Will you receive some cash now and accept payments? Are you getting a job transfer? And etc.
A) Be A FSBO’S Friend:
Owners are looking for people to solve their problem. The last thing you want to do is to make the seller feel uncomfortable. So be their friend. You will find that they will respond better to your questions if they feel comfortable with you.
B) Motivated Sellers:
When talking with sellers, find out their motivation to sell. If a seller responds to you with an attitude of, “I need all cash today”, and that they have the best home on the market, move on to your next lead. Don’t waste your time with unmotivated sellers.
C) Make 2-3 Offers:
Always offer 2-3 different offers and make the seller choose. By making several offers to the seller, the seller will feel that they will have to choose one. This is a great way to increase your chances of getting the deal.
D) Help People:
You are in the real estate business to help people. If you do not learn how to help FSBO”S with their situations, you won’t make any money. When people feel that you are there to help, they will be more responsive to you. This produces deal after deal giving you the best real estate tips.
Dealing with these owners is usually easier than dealing with Realtors. We have seen many times when we make an offer to a Realtor; they never present it to the owner. Some of the offers we make are low and the Realtor knows if the owner accepts our offer that they will not make their commission. The positive side of dealing with FSBO”S is that we can find out their situation and offer them several different ways to solve their problem. Here’s another great real estate tip, create multiple solutions (offers) will increase your acceptance ratio of accepted offers. More accepted offers, the more money you will make.
The most important thing you can find out about the seller is to ask what their situation is. Do you need all cash today? Are you moving soon? Will you receive some cash now and accept payments? Are you getting a job transfer? And etc.
A) Be A FSBO’S Friend:
Owners are looking for people to solve their problem. The last thing you want to do is to make the seller feel uncomfortable. So be their friend. You will find that they will respond better to your questions if they feel comfortable with you.
B) Motivated Sellers:
When talking with sellers, find out their motivation to sell. If a seller responds to you with an attitude of, “I need all cash today”, and that they have the best home on the market, move on to your next lead. Don’t waste your time with unmotivated sellers.
C) Make 2-3 Offers:
Always offer 2-3 different offers and make the seller choose. By making several offers to the seller, the seller will feel that they will have to choose one. This is a great way to increase your chances of getting the deal.
D) Help People:
You are in the real estate business to help people. If you do not learn how to help FSBO”S with their situations, you won’t make any money. When people feel that you are there to help, they will be more responsive to you. This produces deal after deal giving you the best real estate tips.
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