real estate investing information
If you are a beginner or an experienced investor, you should always beware of the guru who read a few books and was armed with general information. I am not talking about the book and selling the tape, but rather the realtor, wholesaler or self proclaimed real estate specialist who is trying to sell an investment property. If you are buying a property or enter into business with someone, you should always do your homework.
In this article, the first of two parties, I will offer some of the questions you should ask anyone before working with them.
1) Are you, yourself, an investor and how many properties has you in the local area? If the answer "no" or say just rent an apartment, run!
Beware of the book and the taint of Tape sales people who have no capital goods and know nothing about the local market. They take your money and run. I met a new investor, the year past that had paid more than $ 5,000 to attend a two day seminar taught by a California man who knew nothing about the Atlanta market. Nothing good can come from that. Dealing with local people, who not only know the concepts but can help you find the right properties to invest in.
2) Can give me a list of bank owned and foreclosed properties in my area?
If they can not provide this, run!
If you can provide a list, select a property in this and following series of questions asked.
3) What property tax value?
This is a "DUH" question – whether the agent or investment real estate specialist can not give the appraised value of a property, they need to change careers. You will be surprised of the number of "professionals" who do not know where to start looking for that information.
In general, the tax value or the value of access to put on a property in Georgia is typically 10 to 20 percent below market value. When I start my search for the possible deals, the first thing I look for property at prices below the value of owning property.
Example # 1
List price is $ 200,000
Accessed value is $ 220,000
This could be a possibility for estimating the value of selling the house to be 10% higher than the value of access or $ 242,000.
Example # 2
Only reverse # 1 – list price is $ 220,000
Accessed value is $ 200,000
I probably will not consider this house because the value estimate selling the house at $ 220,000 – no deal here!
Remember that the tax value is only one of the factors to consider before buying a house, but I consider it a good starting point. If someone is trying to sell a property and can not provide a value tax might not want you to know.
4) Can you give me a list of comparables in the area?
Another "DUH" question. Most Realtors can pull a comparative market analysis (CMA) showing sales history of the past year to include the following categories: Sold, Expired, by contract, and sales activities. In addition, real estate agent should be able to provide a market analysis Area (MSA), provide the average days on market by category.
5) How many days was this property on the market (called days on the market, or DOM)?
If your answer is "no I have access to that information "to run. Any real estate agent should know that the information is available, but the search is the trick. Note the length of the property has been on the market does not match the date of foreclosure. It may take 30 to 60 days after a property has to be excluded from list with a real estate agent and MLS.
Why are the days when the market is important? The longer the property has been on the market – the more flexible the seller. Banks and other financial institutions are not in the business of property management. The daily costs include loss of income, maintenance, insurance, and possible vandalism. I like the submission of tenders under the properties that have been on the books of banks by more than 4 months old. Cash offer with a closing Fast – You will be surprised how flexible banks become aware that it may be the only offer they have received in the property.
Joe Ard has been investing in real estate since 1978 and is a foreclosure specialist and co-founder of Veslet.com. His vast experience working with real estate investors led him to design the formulas currently used for successfully bidding on HUD foreclosures. Originally from Mississippi, he has lived in Fayette County, Georgia for 16 years with his wife.
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