Archive for May, 2009
Building A Fixer Upper Home Business
Building a business focused specifically on fixing up homes to make a profit can be done fairly easily if you understand the right core steps. Not only is it an interesting business but such a venture can be quite profitable as well. When you know how to locate and purchase the right types of homes for a relatively low cost and without using much of your own money you are well on your way to building a business that can reap significant rewards as an owner.
Before you start your business there are a few basics with which you need to become familiar. These include learning what a “fixer upper” is in the first place. It’s a real estate term that means a home is in distress in some way. Consequently the buyer needs to renovate or fix it up to maximize the profit when the intent is to resell. Once you buy the home usually at a reduced cost because of some degree of deterioration you will have a limited amount of time to fix it up for maximum profit.
Your first objective should be to set a realistic time frame to fix up the home. If when beginning you buy more than one home at the same time and think you will fix them up in only a month or so you will be deluding yourself concerning what the complexity and wisdom required to most efficiently utilize your limited resources. A profit is possible if you aren’t spending a huge amount of money on monthly mortgages.
Often homes take much more time to repair than you may naturally think so by starting with a realistic time frame in mind you have an advantage. This preparation includes setting a capable goal for the amount of earnings you may realize during your first year in business. If you overbuy in your first year you will likely find yourself with much more debt than anticipated. Such an oversight can lead to decreased sales because you no longer have the funds to continue ongoing renovations. By starting slowly you can build up your profits before attempting to tackle more homes that you may not be able to afford.
A large percentage of this business includes learning which homes you should sell immediately upon renovating as well as which houses you should hang onto for an extended period of time. If you buy a home that you can easily determine will earn a large profit by renting it out then consider doing so. When owning rental properties you may be able to earn even more money because the monthly income you realize from rentals is hopefully sufficient to cover your monthly loan installments and allow for the building of equity in the property over time. That way you retain the profit you make over the loan amount either to invest in other properties or simply tuck away for later use.
Building a fixer upper business certainly comes with inherent risks. This investment entails the exchange of a great deal of money. Making an assumption that purchased property can be sold again at a higher price also is a significant risk. The real estate market changes and you could reach a point where your selling options are limited possibly resulting in an expensive financial burden for many months before you locate a buyer. For some investors the risk might simply be too great. However if you are comfortable with the risks and have some experience in picking out the “right” homes you could find yourself in a very profitable venture.
About the writer: Omar Johnson is a successful Real Estate Investor and author of the home study course The Real Estate Investor’s Guide To Finding The Motivated Seller for more info http://www.findingthemotivatedsellers.com
Beware Of Being Fooled By Home Staging
According to a report just out it is too easy to be fooled by home staging. Home staging is a term that we are gradually becoming familiar with. It is the idea that we try to create the best impression of our home when selling the house. It used to be just run the vacuum over it and do the dishes but nowadays there is a whole set of rules to follow!
The idea is that a staged home stands out from all the others and therefore gets sold more quickly. It certainly can be carried to extremes with reports of sellers hiring storage units to cart their junk off to. Larger items of furniture are encouraged to be put into storage by professional ‘home stagers’ so that the house looks bigger and more spacious
Another instruction is to remove anything personal like photographs so that the prospective buyer can visualize the house as their own. Closets are decluttered so that they look more spacious and all bathroom paraphernalia is supposed to be gone from the counter top! Garbage bins are even removed and hidden from sight.
However it has been suggested that home staging can also be deliberately used to hide a multitude of sins!
The National Association of Exclusive Buyer Agents NAEBA who solely represent buyers in the realty business has suggested that as much as 82 of buyers are sidetracked from the important issues by a wellstaged house. This organization also concedes that home staging nets more cash and faster sales so it works!
Some of the underhand tricks used in staging can include using smaller furniture to make a room look larger placing rugs over damaged parts of the floor or using curtains to hide rotting sills. Also specified is the practice of putting a cheap paint job on to cover defects. Your realtor is legally obligated to let you know of any defects but only if he actually knows about them!
Buyers are urged by the NAEBA to be cautious and to remember that when the house is sold the stage is taken away. The tricks of home staging do not improve the floor plan or the square footage of the home or the quality of the neighborhood and these are the qualities that you will be reselling at a later date.
About the writer: Written on behalf of Joe Pinto. Joe is one of the topproducing agents in the Chicago real estate industry. With over 10 years of experience Joe brings professionalism and hard work to bear in the sale and purchase of luxury Chicago homes. For more information visit Joe at www.chicagohomeestates.com
Bethesda: Sellers Market
The rumors about the decline of the real estate market have been circulating for some time now and it is true that many of the markets that had exploded over the past years have cooled off somewhat. However there are certain areas of the country that are now seeing their own popularity start to rise dramatically. Take a look at Bethesda Maryland. A quick jaunt away from the Nation’s Capital Bethesda is poised to experience steady growth in both population and popularity. In fact homes are selling faster here than they can go on the market. With the excess of assets that Bethesda offers this is quickly becoming one of the hottest markets in the east.
To illustrate the picture a bit better the Bethesda market is seeing multiple offers on homes within the first week of listing. When one takes the time to examine Bethesda in further detail it is easy to see why this phenomenon is occurring. This area is a diverse community that offers a great selection of homes in almost any price range. A perfect community for families due to the excellent education system and an abundance of recreational options Bethesda is one of America’s most educated and affluent communities. This is a city that is committed to the needs of it’s residents and this is evident in the careful attention that is paid to the visual aspects of the community. well maintained streets frame scenic parks and green spaces that only serve to add beauty to this serene area.
Along with the amazing homes great recreation and thriving business sector Bethesda has the distinction of being known as the besteducated city in the Nation with a huge percentage of the population holding bachelor’s degrees and almost half the population holding graduate or professional degrees. It is easily seen that this has created an ideal atmosphere for business and commerce. Along with the close proximity to the Capitol this has opened up many avenues of employment for Bethesda residents. This is also a favorite community for commuters to Washington D.C. as it offers a minimal commute fantastic home values and the serenity of a suburban area with convenience that one would expect from much larger cities.
About the writer: Justin Lee is a real estate agent specializing in Montgomery County real estate. Justin’s background in economics gives him uncanny insight into the thriving Washington D.C. real estate market.
