Tag: Real Estate Investing Page 4 of 6

Tips for Entering Real Estate Development

On August 15, 2022

There are many barriers to entry when it comes to real estate development. Most of the time, people are not ready to commit to a project due to a lack of knowledge about the various factors that affect real estate development.

Construction of real estate projects can take years, and they usually take a lot of planning and preparation. Even though it can be lucrative, the industry can be very challenging. Due to the fast-paced nature of the business, developers often face unique challenges that keep their operations fresh. Before jumping into the field of real estate development, there are several factors to keep in mind.

Partner with a Mentor

No matter how good you are at technical knowledge, you will need help to operate in the field successfully. Many of the skills that developers use in their projects are learned through failures. Having a mentor can help speed up the learning curve and help you avoid getting stuck with a massive loss on your first few projects. Each deal is different, and each decision point has to be considered carefully. One of the most critical factors a mentor can help you with is navigating through the various decision points involved in real estate development.

Connect with Professionals

Getting a network is also essential to become a successful real estate developer. As a developer, you will rely on the guidance and expertise of third-party consultants during the entire process. A strong network will help you connect with the right people and deliver the best possible service. Usually, you’ll want to work with multiple professionals, such as a general contractor, a civil engineer, a land-use attorney, a lender, and a surveyor.

Make a Plan

Many aspiring real estate developers ask where to start when entering the industry. One of the first steps in becoming a successful real estate developer is establishing a geographic focus. This will allow you to avoid getting stuck in the middle of a multitude of regulations when it comes to developing projects. Before starting a project, you must identify the type of building you want to make. A clear understanding of the type of building you want to make will allow you to focus on the most critical areas.

Set Goals

Getting overwhelmed by the endless tasks that come with real estate development can be a common problem. In addition to finding suitable land at a reasonable price, you’ll also need to secure the necessary financing and develop the property through the eventual disposition. Having a set of goals will help you keep track of your progress and ensure that you’re on your way.

Research the Market

Before you start working on a project, you must identify the building that you want to make. Having a clear understanding of the local property market will allow you to start developing successful projects. Before you start planning a project, it’s vital that you thoroughly research the area to determine the factors that will affect the development of the property.

This step will allow you to collect valuable data to help you develop a successful development plan. Having the necessary data will allow you to make informed decisions and maximize the potential of your project.

Direct Real Estate Investing vs. REITS

By W Darrow Fiedler

On February 11, 2022

In Finance, Investing, Real Estate

Many people are confused about how to invest in real estate, as there are many different types of REITs. Real estate investment trusts are corporations that manage properties for investors.

Direct Real Estate

Direct real estate investing is a way to get into the real estate market without having to spend a huge sum of money. It allows you to generate steady and attractive returns by investing in properties that are worth their rental income.

Direct Real Estate Pros

One of the many advantages of investing in real estate is that it can generate substantial cash flow. This can be done through various tax breaks. One of these is depreciation, which allows you to reduce the cost of buying and improving a property.

Even though the stock market fluctuates, the real estate market generally rises over time. This means that investors may be able to sell their properties at a higher price later.

With direct real estate, you have more control over your money and the properties you buy. For example, you can set rental prices, determine how many properties to buy and refinance your mortgage when the market drops.

Direct Real Estate Cons

One of the biggest disadvantages of direct real estate investing is that it requires a large amount of time and energy to be successful. Another disadvantage of direct real estate is that many investors require financing to pay for their investments.

If the market tanks, they may default on their loan. Real estate is not a liquid asset. This means you will not have the chance to sell a property quickly if you find yourself in need of emergency cash.

REITs

A REIT is a corporation that invests in income-producing real estate. It is typically modeled after mutual funds. In the US, there are more than 225 REITs that are listed on major stock exchanges. With a combined market value of over $1 trillion, these companies are the world’s largest REITs.

Pros and Cons of REITs

One of the main advantages of REITs is that they allow investors to access the profits of the real estate market without being bound by traditional real estate investing rules.

With a 5% dividend yield, REITs are likely to have the highest total return potential. They also have the potential to increase their capital appreciation. Like stocks, REITs trade under heavy volume. This means investors can buy and sell their shares without being forced to do so.

Some of the drawbacks of REITs are that they are not considered “qualified dividends” by the IRS. This means they are taxed at a higher rate than ordinary dividends.

Another downside of REITs is that they are sensitive to changes in interest rates.

Rising rates can make their prices go down while increasing interest rates can stimulate demand. One other thing that’s negative about REITs is that they tend to focus on a specific type of real estate, such as hotels. If this type of property is your main concern, then you’re prone to experiencing property-specific risks.

If you’re looking for a more conservative approach to real estate investing, direct real estate may be a better choice. It’s also likely to provide you with tax breaks. The appeal of REITs is that it allows people who don’t want to manage real estate to get into it. They also provide a good way for people who have limited time and energy to learn about the industry.

3 Home Renovations for a Faster Sale

By W Darrow Fiedler

On August 18, 2021

In Investing, Real Estate

When you know you’ll be selling your home a few months or years down the road, it’s a great idea to use this knowledge and make renovations now before the chaos of selling takes over your life. Certain renovations increase the value of your home more than others. If you want your home to sell shortly after being listed, consider prioritizing these upgrades over others.

New High-Quality Flooring

Old, outdated flooring will quickly turn off potential buyers. Carpet that’s peeling away or trodden down by foot traffic over the years makes your home look low value. Installing new floors is an instant way to completely transform the look of a home. Wood floors are a great choice: they look polished and have an estimated ROI of 70 to 80 percent. Another great option, particularly if you live where humidity levels are high, is ceramic tile. It’s pricier than wood but still offers an estimated ROI of 70 percent.

A State of the Art Kitchen

It’s common knowledge that the two most sought-after remodels involve the kitchen and master bathroom. The kitchen is what really sells a home however, and an overhaul can really shorten the length of time a home sits on the market. When remodeling the kitchen, try to keep things neutral. Granite countertops are still popular, as are tasteful backsplashes and white cabinets. Upgraded appliances bring the entire package together.

A Yard Built For Entertaining

A lifestyle that involves a lot of time spent outdoors is currently very sought after. Some people want to grow their own food. Others want more of an outdoor living room, a cozy spot where they can sit in comfort and entertain guests. Make sure your landscaping is on point and has a polished look to it if you want your home to stand out as a luxury home. Firepits, shady areas in which to sit, pools, and hot tubs are all great additions with high return rates.

These are some of the most lucrative home improvement ideas that will help you sell your home fast. It’s important to keep in mind that even with all the renovations in the world, your home still might not sell. Everything depends on your local real estate market. Still, these changes should make a home more likely to sell, anywhere in the country.

3d Printed Neighborhood Coming To California

3D Printed Neighborhood Is Coming to California

By W Darrow Fiedler

On April 16, 2021

In Finance, Investing, New, News, Real Estate, Uncategorized, Welcome

There is no doubt that technology and industry will continue to evolve in many forms. Many futuristic sectors are currently being developed. Initiatives such as the robotic and the internet of things are becoming more and more of a factor.

Another industry that is emerging very quickly is the 3D Printing industry. 3D printing is emerging in various aspects of society. It has become abundantly clear that 3D printing has become a part of the housing industry as well.

As hard as it is to believe, there is a desert in California set to become a neighborhood constructed entirely via 3D printing.

In this piece, we are going to examine this fantastic occurrence in greater depth.

The location of this potentially historic neighbor good will be the Coachella Valley. Thanks to a partnership between an organization specializing in sustainable real estate development and a construction technology firm, 5 acres of land will become a community of 15 3d-printed houses.

The construction technology firm is named Mighty Buildings. Mighty Buildings considers this project as a realized fulfillment of its vision for the housing industry’s future.

Mighty Buildings is based in Oakland and specializes in creating homes with the use of 3d printers that are pretty sizable.

The material used by the construction company is designed to harden instantaneously. Thus, roofing and insulation can be done in one seamless process.

Mighty Buildings can automate 4/5th of the home construction process while achieving cost savings in manpower. Their approach allows environmental waste to be significantly reduced.

According to the company’s chief sustainability officer, Mighty Buildings can build a 350 square foot home in a day.

The 3D-printed homes will have a modern look. All homes will be 1450 square feet and will consist of three bedrooms and two bathrooms. Also, each home can have another 2 BR/1 BA residence on the premises.

Each home will have a pool in the backyard. Individuals can opt for amenities such as hot tubs and fire pits.

Prices for the primary 3 BR/2 BA 3d-printed home start at $595,000. If one opts for a two-home setup with enhancements, the price is $950,000.

How Your Credit Score Affects Home Buying

By W Darrow Fiedler

On March 16, 2021

In Finance, Investing, New, News, Real Estate, Uncategorized, Welcome

Credit score has several impacts on people’s lives, among them being home buying. It is a measure of personal credit files that dictates the worthiness of an individual. Let’s look at some of the impacts that a credit score can sum up.

Lending and Payment

Apart from a rock-solid financial history, a credit score also matters a lot in approaching lenders. It has an impact on the amount of loan you qualify for to purchase a house. They look much into applicants who have a good record with other lenders, especially on payment duration. Thus, it is also an indication that the respective borrower will be accountable and meet the obligations.

A good credit score implies that the borrower will repay and in the speculated duration. This varies depending on your credit report’s information that brings together your history of borrowed money and payment habits.

Mortgage Rates and Credit

For you to acquire the best mortgage rates, your credit score should be high enough. Persons with a low credit score will end up paying more money during the term of their mortgage. This is attributed to the increased interest and monthly payments.

Generally, a credit score of 700 and above will place you in the best position for mortgages and with the best rates. However, there are still better options for credits below 700. Below is a summary of the scores and statuses.

800 or higher is an exceptional credit, 740 and higher has excellent credit, between 700 and 739 is good credit, and between 630 and 699 results in a fair credit. But for 629 and below results to poor credit.

Down payment Amount

When your credit score matches the desired range, you will be in for a reasonable down payment. Additionally, there will be favorable terms such as a lower original fee. Also, borrowers who bring in more cash on the table reciprocate their potential of delivering and fulfilling the agreement terms.

Borrowers with a low credit score will raise trust issues and will be an accomplice of higher requirements. Such conditions can be incorporating private mortgage insurance into their loans which is results in extra costs. This is pragmatic, especially for new home buyers who need to create a reputable note.