During the 2009 foreclosure crisis I was doing business in Phoenix (and other places). The scarcity of buyers in Phoenix was great for me as a real estate investor who was negotiating to purchase fix & flip project properties at my price and my closing date. Motivated sellers knew it could be a long time before another serious buyer appeared, so they were less inclined to push for more and risk my walking away. But for a flipper there was a downside to those same market conditions. When it was my turn to be the seller of the rehabbed property, Read more…

I will be giving you several posts guiding you toward successful counter offers – that is, counter offers that preserve your profit margin while closing the deal! This post is my brief overview of the basics of counter offers. What are some of the complexities you should understand? You may find negotiating counter offers to be annoying if you feel you did a great job on the rehab and your asking price is fair. But almost every homebuyer believes they should try to buy for less than the asking price, unless it is an unusual market! You would probably do Read more…

Experienced real estate investors have learned to appreciate those title companies with personnel that will work with them and do a great job. But new investors may be thoroughly confused – what is it that title companies do that result in all the charges and fees? What should you expect from your “favorite” title company?   First, know that your local title company is eager to talk with you and explain what they do, even before you do business with them. As a real estate investor you are a wanted repeat-business customer. Take them up on their open door. Let Read more…

Making below-market offers is a kind of reverse sales process, and an intriguing part of the wholesaling and flipping areas of real estate investing. You want to convince the homeowner/seller to let you give them money, rather than persuade them to give you theirs. But – and this is a very big “but” – you are offering less than they probably think they should have. Why should they agree? Will they accept your offer because, objectively, this is the smartest decision they can make? Interestingly, people rarely make big decisions based on objective criteria. Most decisions are emotional, even major Read more…

I want to give you a quick-and-dirty snapshot of some of the important tax considerations of rental properties, if you are not already somewhat versed in rental income. Be aware that this is just a brief introduction, far short of a comprehensive study of passive income taxation!   In my recent blog posts about your strategies for flipping vs. renting (Strategic Decisions: Capital Gains vs Passive Income and Strategic Decisions: A Dual Approach) I mentioned that rental income is taxed as passive income, and receives better tax treatment than either earned income (salaries and wages) or capital gains (profits on Read more…

If you’ve been thinking of jumping in but haven’t quite made the decision, I have 4 factors for you to consider as to the advantages of real estate investing.   1)    Tax advantages – Several deductions are available for investors in rental properties that make opportunities even more attractive. Depreciation on the property value.  This is not just on the mortgage value, but on the value of the property itself.  Interest on the mortgage loan – and also on credit cards used for purchases of goods and services for the property. c.    Repair and rehab costs. Travel – Both local Read more…

As a real estate investor and property owner you’ve probably come across scenarios where it is difficult or impossible to manage your own properties. No matter how much you might hope to keep an eye on your investment, some circumstances just preclude that option. In those cases you need to hire a high-quality property management company to keep track of your property. Unfortunately, not all property management companies are created equal. There are more stories than we care to admit about property management gone wrong. You don’t have to get swindled, though. You can make smart moves now to find Read more…

What is the number one thing that makes being a property owner a satisfying and rewarding job? If you were to ask any room full of property owners that question they would all give you the same answer: high-quality tenants. Filling your rental properties with high-quality tenants—tenants who pay on time, are quiet, don’t ask for unnecessary repairs, and take care of the property—is the single best way to make good on your real estate investment. In fact, for your investment and business to be truly profitable you need to have high-quality tenants.  Having high-quality tenants doesn’t just happen by Read more…

Did you know that most real estate and property management experts recommend that you save up (keep in reserve) between 1% and 3% of the value of your rental property each year for real estate repairs? That’s a lot of money and, sometimes, for big repairs it may not be enough. Replacing carpets and pads or flooring, updating appliances, or cleaning out mold or plumbing problems can easily run thousands and thousands of dollars.  How can you get the best deal on repairs? Don’t worry, we have some ideas. . . One way to score deals is to make friends Read more…

There is no time when the old adage “nobody cares about your property like you do” is more true than when it comes to property management.  Managing your own properties can seem intimidating but it is the best way to make sure your property stays in the best shape possible. Here’s what you need to know to get the job done. 1)    You get what you pay for. While your own time isn’t cheap, neither is the time of professionals who will do a great job on your properties. If you can’t manage your own property (if you live in Read more…