The good news is that flipping houses is a feasible way to earn cash relatively quickly! So how exactly do you get started flipping houses? The 7 Steps of Flipping a House 1. Whatever the case, look into how you plan to finance the deal before you look for the deals themselves. Luckily, there are alternative strategies: For instance, you could get creative and send out direct mail letters or find run-down houses by driving around. Will this deal actually make you money? You’ll want to make sure you analyze your prospect closely and back into whether you can get the ROI you want out of it. Depending on where you are, the closing process might involve different steps. Bonus: Sell that flip. The selling process might seem straightforward, but there are tips and tricks for selling for more money.
The number of homeowners failing to make mortgage payments has dipped to levels unseen since before the 2008 housing crisis. Nationwide, only 4.1 percent of homeowners were delinquent on their mortgage in December, according to CoreLogic’s latest Loan Performance Insights report released Tuesday. Down from 5.3 percent in December 2017, the latest rate is the lowest since January 2000. Yearlong delinquency rates, which have been falling steadily since the start of 2018, have not been this low since early 2006 – just before the housing and financial crisis of 2008-2009. Foreclosures, in which property is seized due to an owner’s inability to pay, fell to 0.4 percent from 0.6 percent the year before. “Our latest home equity report found that the average homeowner saw a $9,700 increase in their equity during 2018,” said Dr. Frank Nothaft, chief economist for CoreLogic, in a prepared statement. “With additional ‘skin in the game,’ rising equity reduces the chances of a foreclosure, helping to push the foreclosure rate down to its lowest level since at least 2000.” All stages of the delinquency process have been seeing drops over the past 12 months — but serious delinquencies, in which mortgage payments are overdue by more than 90 days, saw the biggest drop, from 2.1 percent in December 2017 to 1.5 percent this year. A strong job market and low unemployment rates continue to spell good news for homeowners for what will likely be months to come – even as the frequent rate of natural disasters puts homeowners in some parts of the country at risk of falling behind on payments, said Frank Martell, president and chief executive of CoreLogic. “On a national basis, income and home-price growth continue to support strong loan performance,” said Martell. “Although things look good across most of the nation, areas that were impacted by hurricanes and other natural hazards are experiencing a sharp increase in the numbers of mortgages moving into 60-day delinquency or worse.”
This is a good time to get out and start investing in real estate. Last year, we saw a slowdown in the luxury market as homebuyers took a wait-and-see approach to interest rates, TCJA’s limit on property tax deductions and the stock market. The normalization of prices should spur demand from luxury buyers who’ve been on the sidelines. If you’re an investor, look for bargains among REITs that invest in residential real estate, or put your money to work at lending firms. Effective through 2025, owners of entities that pass through income to individual taxpayers may deduct 20% of “qualified business income” from their “qualified trade” in real estate. Real estate depreciation rules are more favorable than ever because qualifying property acquired after September 27, 2017 is eligible for 100% bonus depreciation over its first year in service. In addition, it creates an incentive to upgrade. Now, 100% of the renovation cost can be deducted from the first tax year's rental income. Another benefit, found in Section 179, expands how assets for commercial properties can be expensed. I have always advocated for and helped facilitate people making money in real estate, and with all these new tax incentives working in your favor, 2019 is a great year to invest.
In this case, turnkey real estate investing might be an awesome option. So make sure you understand how much that bank can lend to you as you establish and grow your business. Make sure you understand where that bank will lend, especially if you’re looking out of your state. If you are planning to set it and forget the portfolio for a while, these can be a great option and highly scalable. Understand who you want to work with and how many properties you want to buy over what time period and in what location. Learn and grow as an investor. Build several great banking relationships, and execute your plan. Watch your real estate empire grow, and enjoy the success as you grow it. Where are you in scaling your turnkey portfolio? Actionable Advice for Getting Started, Discover the 10 Most Lucrative Real Estate Niches, Learn how to get started with or without money, Explore Real-Life Strategies for Building Wealth, And a LOT more Sign up below to download the eBook for FREE today!
Even for those who have decent credit and make good money, the down payment is often the great homeownership killer. For many others, who do have enough money set aside to make a substantial down payment, the question is: how much? Conventional wisdom—not to mention most of the banks and a good portion of homebuying and financial experts—will tell you that 20 percent is the standard bearer when it comes to down payments. But is it really necessary to put 20 percent down? The short answer is: no. It's not, of course—"Mortgage insurance protects the lender in case you can't make your payments and the house is foreclosed on," said U.S. News—but that money can make a significant difference for those who are stretching to buy a home. Still, when your only option to buy is a low down payment, which can mean an FHA loan or one of the new low down payment loans from Freddie Mac and Fannie Mae—"At the end of 2014, the two government-backed companies announced plans to slash down payments from 5% to 3%," said CNN—PMI might literally be a small price to pay. When to make a substantial down payment When you're looking to keep your monthly payment as low as possible and have cash to spare When you just can't fathom paying PMI When your goal is to buy a forever home and own it free and clear When you are approaching retirement age and can envision a reverse mortgage sometime down the line When you want to buy your house and pay it off as quickly as possible When the rate is lower with a higher down payment. "The more you put down, the better position you are in for negotiating a lower interest rate with your lender," said Credit.com. When to go low When you don't have the funds for a higher down payment and can't earn or borrow them quickly enough When the rate on your FHA or Fannie or Freddie loan is comparable to that you'd get with a higher down payment When you need to escape a high-rent situation and the monthly payment on a house is lower than what you're currently paying, even with the PMI factored in When you're confident your home will appreciate quickly, allowing you to refinance and get rid of PMI quickly When your investments can't be touched without a penalty or are returning better than the interest rate you'll get on your home If you have something better to do with the money.
It turns out the answer to that question is not as simple as one might hope. The main issue that we continue to see as we evaluate potential Opportunity Zones (OZs, or OZones) is, "Do the deals make sense on their own merit, independent of the potential tax advantages an investor might realize?" If a deal doesn’t pencil out on its own over the 10-year hold period required to meet the OZ, an investor could end up losing money even though they are able to offset some significant capital gains on the front end. Instead, groups are targeting designated areas that tend to be adjacent to stable submarkets or those that have already experienced significant development growth in recent years where they can benefit from an existing tailwind of economic activity. The result of this flight to safety is that many of the areas that need the development activity the least are the ones getting the most attention. In my observation, many of the lower-income areas that the program originally targeted are not getting the same level of attention because most groups are afraid to be the “first one in” to a market that may or may not actually become revitalized. This reality has led to what I see as a scarcity in quality OZone investment deals with solid underlying fundamentals, while creating a level of restricted access to any kind of meaningful deal flow. It could be a while before this starts to happen, however, as I predict a continued flight to safety as investors flock to lower risk, infill markets. The key here is to not become blinded by the potential tax-deferred benefits of Opportunity Zone investing and really look for deals that you would want to invest in regardless of their designation. Over time, however, the hope is that the more attractive deals will become available to the average investor and they, too, will get to realize the benefits of this new and exciting program.
It’s our duty as leaders to dig in, identify hidden needs and discover new ways to better serve our local communities. From countless conversations with homeowners to meetings with city council members and local business leaders and research into community-specific issues, we found the hidden need: Short-term-rental homeowners wanted the ability to provide a consistent experience for guests, manage properties ethically, be good neighbors and benefit the local economy. We built our solution for a vacation rental property management company that invests in local communities from there. This is par for the course. Ensuring your mission is focused on the needs of your community will ultimately lead to more positive conversations and proactive solutions. At TurnKey, we rely heavily on feedback from our homeowners and guests, who are the reasons the company exists. Finally, stay involved in your community. It keeps you in tune with your community and helps you focus on the mission of giving your customers and community members what they want. We think daily about the impact we’re able to make on homeowners, travelers and communities across the U.S. As community leaders, you must make choices for your businesses that benefit the communities you're serving. If a business is engaging in activities that detract from the people they’re asking to do business with, it’s time to step back and evaluate what can be done to make the company an enabler of sustained economic growth, rather than instability.
What are the benefits of refinancing? Most people would agree that it only makes sense to refinance your mortgage if there is some tangible benefit to doing so. If you took out your mortgage prior to the financial crisis of 2008, you'll likely still be able to refinance at a much lower interest rate, which will lower your monthly payment. Cashing out your home equity: With a cash-out refinance, you refinance your home for more money than you currently owe on the property. Just like when you first took out your mortgage, you have to pay closing costs in order to receive your new loan. With that in mind, it's important to look at how long it will take you to break even on your refinance, or how long it will take you to recover the cost of those fees and truly start to see savings from your new loan. How much equity do I have in my home? (Though, it is possible to find lower options.) Finding how much equity you have in the property is easy. Then, if so, to factor those fees into your cost calculations for your break-even point.
For investors looking to make a solid financial return in 2019, the property market continues to offer opportunities due to the stabilizing U.S. jobs market. Houston remains a strong investment option due to the improved job market that has seen an 8.7% job increase since December 2017, according to the January 2019 report. Phoenix saw a 6.7% increase in jobs for 2018, and San Francisco saw a 5% increase overall. Investing in cities with high demand for rental properties, such as New York, Los Angeles and Houston, can create additional opportunities for investors. Demand for workforce housing in addition to housing for those displaced by Hurricane Harvey has resulted in a gradual stabilizing of the rental market. Property managers should also consider earmarking some marketing dollars to promote investment properties during times of increased demand. Property managers based in major cities can anticipate increased demand, considering the influx of job seekers moving to job hot spots. Investors and property managers should consider the following best practices for taking advantage of a hot jobs market: Analyze consumer data: An investor's best gauge for cost of living and inflation for consumers is the Consumer Price Index (CPI). These numbers are updated and analyzed regularly by the U.S. Bureau of Labor Statistics. This information can be used to help keep on top of potential investments.
Here are five factors that experienced real estate agents consider before slapping that "For Sale" sign on a home. What's happening in your local housing market at any particular moment Current real estate market conditions—including how many houses are up for sale, and how fast they’re being snapped up—determine how a property should be priced. A surplus of homes for sale results in overall lower asking prices. That's why he recommends working with an experienced real estate agent who's familiar with the neighborhood you're shopping in and can assess whether a home is priced fairly—or not. And how old are the buildings to your right and left?” asks Sheldon Salnick, a Realtor® with Dreamtown Real Estate, in Chicago. The comps Often, Vitali says, sellers have a figure in mind based on nothing more than a wish. But real estate pros will do a comparable market analysis—what similar homes have recently sold for—before determining how to price a property. “Historical data plays a huge role in setting a listing price; it's not a number just pulled out of the air. So find an agent who can interpret that data,” Vitali says. It all depends on the home's location (see No.