6th April 2011

The Lease Option Landlord – Part 2

Setting a Lease Option Future Sales Price

There are three schools of thought when setting a lease option price:

1.    Use current value

2.    Use estimated value at time when contract is to be exercised

3.    Set the price at future market value

To be quick and easy, you can use option 1 by finding today’s value for a similar property, or by using the positive cash flow with some notion of a current cap rate. Read the rest of this entry »

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30th March 2011

The Lease Option Landlord – Part 1

Down markets create amazing opportunities for the investor.  However, a landlord who is sitting on one or several properties might be real estate rich, but cash poor, and unable to tap into those current market buying opportunities.  In those situations landlords would traditionally sell one of their properties and apply that money to a new purchase, preferably one that offers a higher return than the property previously sold. The only problem is, as mentioned before, the down market might be forcing you to sell your property for less money than you originally expected, or worse- for a loss, and neither of those situations is ideal.  What’s an investor to do? Read the rest of this entry »

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1st March 2011

How to Choose a Real Estate Broker

Up to the point I purchased my first property, the few experiences I had with real estate agents led me to believe the group was only slightly more trustworthy than snake oil salesmen; a fact which led me to learn everything I could about buying, selling, and managing property on my own.  I read everything I could get my hands on concerning real estate including law books, state codes and statutes, blogs, and websites. I learned about analyzing income and expenses, cap rates, appraisals; it was all so interesting.  I even went so far as to get my own agent’s license; and that’s when I realized I didn’t know as much about real estate as I thought. Read the rest of this entry »

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2nd August 2010

Rental Stress Test

The following is a guest post by Clint Darby of Rentals Done Right.  Check out his blog when you get a chance.

Allow me make a confession to you – I am a conservative Real Estate Investor.

I don’t make apology for it, it is what it is. That doesn’t mean I do not take risk. On the contrary, if you asked my wife, I believe she’d tell you she has to reel me in from time to time. Though I do not mind risk, my conservative nature forces me to mitigate risk as much as possible. I do that by trying to be prepared.

Let’s face it – regardless of where you fall on the political spectrum, the economy smells worse than a gut truck. America is hemorrhaging jobs, incomes are down, foreclosures are up and real estate has tanked. Read the rest of this entry »

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12th January 2010

Why Condominiums Are A Bad Rental Investment

Last month, while having lunch with an old friend, we had a discussion about the merits of buying condo units as a real estate rental investment. Having been a condo owner in the past, I can positively say that I will never do that again.

This subject could easily fill a book, so here are my reasons in bullet-point form:

  • Too many complaints from neighbors. Tenants usually only sign a year lease so if they annoy their neighbors, they can simply move. The neighbors then transfer their frustration and annoyance to the landlord.
  • Condo Associations. If you like to invest by committee, condos are for you. Don’t want to afford that fat assessment to resurface the parking lot right now? Too bad. Pay up.
  • Condo Commandos. These people are usually retired and have nothing to do all day. Nothing, except get all up in your business that is. They feel that you as a landlord are devaluing their property by renting your unit and they won’t let you forget it. Read the rest of this entry »

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