Real Estate Blog

Most if not all of us at some point will come across a deal that is too good to pass up.  When this does happen (and it will), being ready to jump on it will determine whether your going to make some money or a lot of it. 

How do I prepare for a deal, you might ask.  You have to have the funds available to you before the deals start rolling in and not after.  By developing your relationships with the banks that you use regularly, you can build a credit that will one day be used to purchase properties, when you need it.

If there is a bank that you have been using for a while, start out by getting a unsecured loan for $1000.00 dollars and place it in a subsequent account at another bank that has a good interest rate.  I suggest using a money market account which can get you upwards of 3-5% return on your money.  One I like in particular is www.flagstar.com which has a 3.65% return.

If you can start small and get a unsecured loan for a nominal amount, then pay it back over the course of 3 to 6 months, you can slowly build up your loan amounts that the bank will offer.  If you start to find problems with getting larger loans, try speaking with the loan officer first - if he can’t help or won’t, talk with his supervisor. 

If you find that your bank is not willing to work with you on getting larger loans, let them know that you have been a valuable customer, have an impeccable credit rating, and are always on time with paying back your loans.  If they still don’t budge, tell them you are going to have to take your business elsewhere. 

Most banks want to keep the business of people that are good with loan payments and can afford large loans.  Since this is going to be your main vein for funding your deals, you will need to pay close attention to developing a relationship with your bank.

After you have built your credit up to a sufficient amount, usually $30,000 or more in available loan credit, move on to other banks and use the same technique.  Eventually, you will have a good source of cultivated funds for immediate cash.

Many see the lavish lifestyles of pioneers of our greatest industries and assume that it is impossible to follow in their footsteps.  Bill Gates popularized the graphical user interface to allow people to visualize computers, Henry Ford revolutionized the way we travel, and Donald Trump changed the the way we do real estate. What most don’t realize is that they used a basic and rudimentary technique to get where they are today. 

The direction that an economy takes is established by providing what the public wants.  What it needs is good too, but what it wants is the driving factor that causes buzz, induces a buying extravaganza that fulfills the public needs and drives demand.  The key is to know what the public wants, before it even knows it. 

If we all knew that iPods were going to become one of the greatest electronic devices ever invented, we would all have tried to invest in it when Apple unveiled it in October of 2001.  Since then, Apple has had not only a resurgence, but an awakening.

When a company fills a void that has little or no market, there is always the ability to turn into a super performer.  Look at the example of Vonage — this company was able to take the unknown realm of Internet telecommunications and turn it into a billion dollar venture.  They saw the capacity for the Internet to support high quality communications by using the a customers pre-existing Internet connect as the conduit for this medium.  They tapped into an area that had not been explored on a mainstream basis, packaged it, and sold it to the masses.

When there is a need, fill it.  When one is filled, recognize it and invest in it.

It is amazing how people can throw together a green couch and a yellow pillow and call it interior designing.  I can’t match my clothes, let alone trying to make a house match.  What a waste of time.  If people would spend as much time on marketing their homes as they do on making it look pretty, they would have a better chance of selling them. 

Look at it this way.  If you had the nicest looking home in the neighborhood (on the inside) but no one knows about it, what are you accomplishing?  It is nice to be good with designing things and making things look pretty.  To be honest though, if you can’t get them in the door, your not going to sell that pretty house.

Take feng-shui for example — this is an ancient Chinese art and science developed over 3,000 years ago which involves proper alignment and position of all matter and objects, namely furniture.  This is real popular in major metropolitan cities and is just one form of interior design used by some homeowners.  If I walked into a house that had good feng-shui, I wouldn’t know it –  I would however notice if the couch is facing the wall instead toward a TV or window.

No matter what you do to make the inside of a house attractive, and I am not saying it is not important to have a clean and tidy home to show, you have to make sure you market the house enough to draw in the customers.  If you can’t get them in there, what good is it in having a green couch with yellow pillows to show off.

While driving to my office after meeting with a client, I was contemplating whether it is good to allow technology to run my business as much as I allow it.  From setting up my showings through the Internet to writing contracts directly on my touch screen laptop..  the answer is an astounding YES! 

With the wonderful advancements we have made in real estate compared to the old hard copy MLS print outs that use to be handed out to local brokerages, we are really in a good time for real estate.

Considering all the gadgets and gizmo’s out there in the world of real estate, its only a matter of time before buyers can basically show houses themselves.  Pretty soon it will be almost impossible to ignore how easy it is to see that house down the street you were dying to critique with little or no agent interaction.  With the invent of things like virtual tours, blackberry phones, and touch screens – we just can’t help but find ways to make it easier to show and sell homes.

By the time I reached my office, ideas had overwhelmed me.  Virtual tours so advanced that a buyer may get so immersed with a house that they need not leave their computer to have confidence to hit the BUY button! 

Imagine for a moment, cameras through-out a home with panoramic views that rival that of Google-Maps.  Its almost here and there’s no way to stop it.. unless the owners don’t like to see their home sold like eBay vs reality TV.

I had an interesting morning looking at a home that had potential, but alas, was a real fixer with more than its share of problems.  What a piece of work! 

Mold.. and i am not talking about the green kind on food, this is toxic black mold — so much in fact, it looked like there was fire damage.  There were signs of foundation problems so extensive that the upstairs slanted into a V formation.  All the doors were not only open, but jammed. 

Why is it so hard to just walk away from a deal?  Every now and then you have to just say ” This one’s just not worth my time”. 

Sometimes there are things that just need a little TLC and then there are those that just cannot be fixed.  Carpet, roofs, foundations, siding, and even sheet-rock are some things that deter buyers from moving forward on a purchase.  These issues can often times be addressed for very little cost, but I tend to look a bit deeper, delve more into the real problems.

Does the house your buying for investment have major foundation issues — i’m talking about the kind that has made the exterior buckle, roof to sag, and most importantly, damaged the plumbing.  This is where your real problems are going to be and sometimes hardest to see and fix.  Electrical will usually be another expense that can really run up the tab, so your certainly going to be needing an inspection on all and I mean ALL purchases.

Even the real pros know their limits.  Gosh!  I can’t think of a single investor that I know that would not turn down a really problem house if it wasn’t going to make a descent profit.  We don’t work that way.  We invest, therefor we are looking to make a nice profit.  If the repairs are going to devour the profit, we move on.

Next time you walk into the house from hell — step back and breathe.  Then ask yourself, “If I don’t buy this house, who will?”  You will then know whether you can wholesale it to someone else, rehab it yourself, or run like a bat out of hell!