“Fall”ing Into Real Estate Investment

Real Estate Investing is a broad phrase that covers everything from short sales, to tax liens to wholesaling to rehab flips as well as commercial real estate. If you are a beginner, where do you start?

As a beginner, there are 3 Main things to consider when you are starting to invest.

1. Invest From a Position of Strength.  With cash you can negotiate better deals that provide more profit.  If you don’t have your own cash, then seeking private lenders to bring on your team will make your investment much stronger.

2.  Have Goals; Invest in Properties That Provide Multiple Exit Strategies. With multiple exit strategies available, you have less of a chance of getting stuck with a home you can’t move. Always plan for the long term. Have an end goal in mind to help stregthen your investment strategy plan.

3. Know Your Market! Conduct your market research before investing in real estate to know if your market is a good market to invest in.

• Who are the major employers in the area and are they stable?
• What is the population growth trend?
• What are the expected limitations?
• What are the local rents and how are they trending?
• What are the average and median home prices in the area?
• What economic anchors does the area have?

These are three principles you can follow to ensure that if you are starting out investing this autumn you will have a stronger sense of what you are getting into and how to effectively navigate this career.  If you need any other tips for starting your investment strategy contact us anytime at http://www.reiaofoakland.com.

Mark Your Calendars: Private Money Lending Session with Alan Cowgill

Click image for Alan Cowgill Website

Our members tell us their number 1 roadblock to investing in real estate is a lack of funds. So, we’re bringing in private money guru Alan Cowgill September 8th at 7:30 pm.

Since 1995, Alan has bought and sold over 200 investment properties using Private Lenders, not banks; to fund his real estate purchases. By doing this, he has created his own private bank of $2,000,000 in funds. Alan looks for “Win – Win” situations, where the seller, the lender, and the eventual homeowner can all “Win”. He is not a Realtor,but a Private Investor.

Some of what Alan will be sharing with REIA of Oakland members:

• The basics of raising private money
• How to attract potential private investors to a luncheon
• How to host a luncheon for the highest success
• Who to target as prospects and where to find them
• Pitching prospects one-on-on
• How to establish credibility with prospective private lenders
• When & how to legally accept private funds
• What legal documents need to be used
• How to avoid getting in legal trouble

Alan Cowgill is the owner of Colby Properties, LLC.and President of Integrity Home Buyers, Inc. He’s been a Real Estate Investor for over 30 years, investing in single family and small multi-family properties in Springfield, Ohio. He’s been a national speaker for over 15 years.

For details about the event please visit our website

Full Disclosure E. Alan Cowgill & Integrity Home Buyers, Inc. were the subject of an Ohio Division of Securities Cease and Desist Order/Consent Agreement in April of 2007, for not properly disclosing company financial information and representing their investments as “guaranteed, low risk and safe & secure”. According to Mr. Cowgill, he voluntarily contacted the department to be sure he was in compliance. The order can be confirmed  HERE:

Why is It Important that REIA of Oakland is Not for Profit?

There are new real estate investing groups popping up like weeds lately.  Unfortunately, many of them are FOR PROFIT, and have arrived on the scene to take advantage of the rocky real estate market that Michigan is navigating right now.  These new, FOR PROFIT groups have one goal in mind, to make a profit.  Now, there’s nothing wrong with making a profit.  However, when it’s the group that is supposed to be looking out for your best interests and educating you on how to maximize your investment strategies, it creates a conflict of interests.  If the group is for profit, they are going to be selling you Kits, DVD’s, Books, Seminars, Classes, Bootcamps, and anything else that they can think of, for hundreds and even thousands of dollars, whether it’s in your best interest or not.

Why?  Because if they don’t, they’re not making a profit. REIA of Oakland, on the other hand, is run by unpaid volunteers.  We have only one paid, part-time employee.  All the money that we bring in is used to run the group and bring you the best services possible.  This is why at REIA of Oakland, you will see more unpaid, local experts bringing you relevant, timely information at our monthly meetings.  REIA of Oakland purposefully limits speakers selling products to 4 times per year or less, and we screen them to try and bring you only the very best.  REIA of Oakland’s goal is to make its members the most educated and professional real estate investors in the country.  Not to sell you products.

 

In Investing, Price Matters!

Written by Rick Pridemore

With the increase in buyers searching listings on their own, using the internet and other tools, care must be taken to understand how pricing impacts the visibility, and thus selling opportunities, of your property.

In the old days, when buyers had to rely on lawn signs, they typically would drive around neighborhoods looking for attractive houses.  When they found one, they would call the listing agent and request the price.  The listing agent would spin their best sales pitch before giving the price.  After getting the price the prospective buyers would decide whether it was in their price range and if so, schedule a showing.  In this scenario, the exact listing price is meaningless in attracting the buyer’s inquiry.  Regardless of whether the house was priced at $299,999 or $399,000, the initial call was generated by the neighborhood and curb appeal. This system forced buyers to call on properties regardless of the listing price to get more information.  This gave the real estate agent an opportunity to sell the features of the property before giving the price.  It also exposed buyers to a wider price range because the only indication they had of the potential price of a home was the general market area.

The internet, however, has changed everything.  Buyers can now search for properties based upon city, school system, bedrooms, bathrooms, architectural style, and a myriad of other criteria.  Price, however, still remains the number two search parameter, second only to location.  Because of this, you must price your home very carefully to ensure that it shows up in the greatest number of searches, and to the correct audience.

Event: Orlans Associates Share Inside Information On Michigan Foreclosures & Short Sales

Through over a year’s persistency we’ve finally been able to arrange for personnel from Orlans Associates, one of Michigan’s top foreclosure companies, to share their knowledge & experience on the latest regarding foreclosures and short sales.

This is all specifically about what’s happening with Michigan properties, not useless internet information about California, Arizona, Florida, etc.
Some of the topics & information that will be covered:

Tips on buying property at Sheriff Sale or at the end of Redemption. Which is better?

• The number of foreclosures Orlans processes that are upside down.
• Inside statistics on the percentage of foreclosures where lenders are bidding less than their mortgage debt owed.
• Details on the short sale process, what lenders will settle for and success rates.
• Angles on buying properties using short sales and how to avoid the hurdles.
• The types of fraud Orlans and eTitle personnel see with sales of REO & short sale properties.
• Their opinions on how real estate investors can best profit from foreclosures & short sales.

You won’t find this information anywhere online, so attendance is a must!
Orlans Associates & eTitle were both started by Linda Orlans and are now one of the largest foreclosure and short sale companies in Michigan.
Be sure to mark your calendars for this event.

 

Real Estate Reality: Buyers Judge A “Book” By Its Cover

Written by Rick Pridemore

Television programs about home “staging” have exploded in popularity recently.  So much so, that many people believe that home staging is a new concept.  Not so.  Professional real estate agents have known for a long time that a little “spit and polish” goes a long way in selling a home.  Let’s look at some of the most effective areas to spend your time and money.  To begin, the importance of a good first impression cannot be overstated.  If the buyer pulls up to your property and is turned off by a messy yard, overgrown landscaping, or peeling paint, they often won’t even spend the time to look at the interior.

The psychology of the buying decision causes the client to look for validation of their first impulse.  For instance, if they pull to your house and decide that they don’t like it, as they tour the inside of the home their subconscious mind will look for negative points to validate their initial dislike of the home.  As they walk through the home, they will be subconsciously thinking “The closets are tiny, too,” or “the kitchen won’t work, there’s no counter space.”  On the other hand, if they fell in love with the exterior, their internal dialogue would go something like this: “The closets are small, but an armoire would fit over there,” or “all the kitchen needs is an island.”   So put your best foot forward, and put them in the proper frame of mind:

• Make sure that the lawn is always freshly mowed
• Edge the lawn
• Make sure that fresh mulch is laid in all of the flower beds
• Fill planting areas with blooming flowers.
• Clear the yard of toys, hoses, sprinklers, etc. 
• Trim all bushes and trees.
• Power wash the driveway, porch, and sidewalk
• Make sure that the shingles look newer, if not new.
• If the siding is painted, honestly evaluate whether it needs a fresh coat.
• Clean all of the windows, inside and out.
• Paint the front door
• If the mailbox or address numbers are mounted on the front of the house, make sure they look new and attractive

Real Estate Lessons Learned: Borders

As many of you may have heard Michigan-born business Borders is slated to liquidate many of their stores after years of fighting fiscal turbulence. This announcement may be a surprise to some but a predictable outcome for many who have been watching the once booming giant over the past few years.

Many experts have suggested that the number of physical stores and lease durations have had a profound impact on Borders demise. With over $1 billion in lease obligations the company has simply expanded too soon. But what is left of the 500 plus stores that are slated to be chopped?

I am particularly interested in how this will impact job lost here in Michigan, and especially the implications it has for real estate values in locations it exists. The physical store has truly been a critical element in the survival of company and serves as a lifeline for the future yet also proposes challenges for the company’s sustainability. According to AnnArbor.com the most concrete example of this is when “the company admitted in late January that it had stopped making rental payments on some of its stores.” Nationally, a little over 10 Borders stores are listed for sale, most of which 20,000 square feet or more in size having a profound effect investor risk and consumer outlook.

Other factors to consider include the time and expense to the owner if a store like Borders leaves. Most owners have a level of uncertainty about their investment. Some experts believe that retailers are looking to expand their stores in soon-to-be empty spaces like Borders. The company has a reputation of being very disciplined about taking the best locations in the marketplace. That bodes well for landlords, and ultimately communities. It’s also part of the long history of the local company that became a national name.

This in my opinion has profound effects on in the residential real estate sector. Lost of jobs and the economic consequences of a huge company like Borders leaving, could have profound effect on former employees ability to live sustainable lives, which creates a unique challenge for many real estate professionals.

Many cite Circuit City as a case study. About 30,000 people lost their jobs as 567 stores closed. Many believe Borders can avoid creating economic unrest be revamping the company’s infrastructure.

What do you think? What will it take for Borders to survive?

Why Should I Join REIA of Oakland

REIA of Oakland is a non-profit organization serving real estate investors in Wayne, Oakland, and Macomb Counties since 1981. Click here to join REIA or renew your existing membership. If you are currently a member and need to update your information, please click here. Why should you join REIA?   FREE ADMISSION – REIA of Oakland members enjoy free admission to our monthly seminars.  Over the course of a year, that’s a $240.00 value! Professional Support – A REIA membership will make you part of a shared information network and provide you with volunteers in several fields that you may call. Among these many helpful members we have landlords, attorneys, lenders, and real estate professionals who are available to answer your brief questions. Networking – REIA offers the perfect environment and opportunities for you to meet other real estate investors in Oakland County.  Share your experiences and learn from others who understand your problems. Education – Your REIA membership will offer countless opportunities to learn more about real estate investing.  We offer monthly seminars covering topics such as finding properties, accounting/tax issues, real estate law, repairs, financing, purchasing, and sales.  Stay Connected – Members also receive our monthly newsletter, dedicated to bringing you the news you need to know as a landlard or real estate investor.  Learn about local and national issues that concern you.  Resources – Members of REIA may obtain brief legal counsel and CPA services over the phone and free of charge from experts in landlord/tenant matters.  Plus, members have access to BOCA rulings and specifications.  REIA works for you – We are continually on the alert for the latest issues affecting landlords.  Our lobbyist in Lansing keeps us abreast of state issues affecting our membership, allowing us to work with the proper state and federal public officials on your behalf.  REIA takes a positive approach to improving laws regarding zoning, building codes, housing standards, and more. Discounts – Members of REIA receive discounts from local and national suppliers, such as Home Depot, Sherwin-Williams, Nationwide Insurance, and Avis Car Rental, just to name a few.

Besides being a great place to meet and interact with other like minded Real Estate Investors, REIA of Oakland membership offers the following benefits! 

A Little Bit More About…REIA of Oakland

Happy 4th of July All!

Just thought it would be a great idea to tell you all about what we do and who we serve. REIA of Oakland services investors who own real estate in all of lower Michigan, and even some that own property in other states!  Wayne, Oakland, Macomb, and Livingston counties are the main focus of most of our members, but you are welcome to join no matter where you invest, as long as it’s real estate related.

 Many of our members are just thinking about getting into real estate investing and have joined REIA of Oakland to learn as much as they can BEFORE making mistakes.  Joining REIA of Oakland is a great way to learn the ropes and get sound advise when you are beginning your real estate investment career.

What the New Michigan Tax Law Might Mean for the States Real Estate Market

Governor Snyder’s changes to Michigan’s tax system are now the law. Supporters of the new law like, Business Leaders of

Rick Snyder

Michigan President and CEO, Doug Rothwell, said in a news release that “with simpler, fairer tax structure, Michigan can be more competitive and, as a result grow jobs.” The Legislature passed the bills at the end of May this year. As first reported by Crain’s Business Detroit,  the legislation enacted a business-tax cut of about $1.7 billion, ending the Michigan Business Tax and replacing it with a 6 percent income tax on “C” corporations. All other business entities — such as sole proprietorships, limited-liability companies and other individually owned businesses — would pay only individual income tax. Those entities currently pay both MBT and individual income taxes.

So, what might this news also mean for the Real Estate market and property investors here in Michigan?

Building for lease on Washington St, Royal Oak, MI

As those in the Real Estate world know, when companies grow in employee size and increase their revenues through cost savings they often times grow into larger business spaces as well. So the Real Estate hopefuls in Michigan may benefit by keeping a close watch on the many existing, available commercial spaces that may start to fill over the course of the next year, as the new Michigan tax law begins paying off for business owners.

According to large real estate search sites like cityfeet.com, there are currently over 4,600 commercial properties for lease or sale in Oakland County, Michigan alone.

Sources:

http://www.crainsdetroit.com/article/20110525/FREE/110529937/snyders-changes-to-michigans-tax-system-now-are-the-law#

http://www.cityfeet.com/Commercial/Search/