How to Save Your Clients Money

Shopping, Svae Money, Alec ShklayrAs the real estate industry evolves along with the rest of the changing world, more opportunities to cut costs, save your client money, and better your reputation emerge. It is important to reflect on these advancements and communicate them to your client so they are saving the most money they can. Sometimes, these opportunities to save money have been around for decades and are not the result of some recent development—they just slip by unnoticed.

Whatever the case, here are a few tried and true tips to save your clients the money they will appreciate:

Don’t call professionals for minor repairs.

So often, homeowners will ring a maintenance professional for clearly minor issues like a leak toilet, for instance. In reality, a leaking toilet is an incredibly easy repair and can often be fixed just by watching a YouTube tutorial and following instructions accordingly. Direct your clients to the proper instructional video or free online resource to save them from needlessly calling a professional.

Ditch extended warranties.

Although extended warranties may seem like they’re worth it at the time, the truth is they are unnecessary for those with the highest price tags. High-grade appliances like your refrigerator and oven generally will not need any major repairs before they need to be replaced completely, so it doesn’t make sense to pay extra for an extended warranty. In fact, your clients would be significantly better off stashing the extra cash in a savings account of some sort.

Forgo storage if possible.

Considering the average cost of a storage unit today is anywhere from $50-$300 a month, is it really necessary? For the most part, your clients can just trash or sell unused items, and store the things that truly matter in their home. Additionally, your clients can reorganize their home storage or maybe even institute some slight renovations like building out window seats with drawers to gain more space.

Just by following these very simple tips, your clients and other homeowners alike can save $1k+ every year. By giving sound financial advice and remaining available to speak with prospective homebuyers, you will develop a prestigious reputation for financial nuance, and your clients/customers will pay you in kind for it.

7 More Highly Rated Real Estate Investment E-books for Kindle

When looking to learn more about real estate, it can be difficult to discern the good information from the bad. That’s why it’s so important to read the right books and to learn the right information. Fortunately, there’s this list of highly rated e-books for the Kindle that can help even the layman homebuyer become a real estate expert. Check it out!

Why Homeownership Matters

With so much information circulating the real estate industry, there is one prevailing concept in particular that oft goes neglected—why home ownership matters. We know it makes a difference, but many don’t know why it makes a difference. Luckily, I just came across this article that does a fantastic job of explaining of why owning a home matters. Check it out here!

What Your Real Estate Agent Won’t Tell You

There are so many misconceptions about the real estate industry, and these misconceptions only become more difficult to assess as such when agents are not completely straightforward and honest. Purchasing a home is one of the most significant fiscal decisions, if not the most important decision, a man or a woman can make, and it only makes sense that they seek out the advice of experienced professionals to lend some insight.

In light of such, I wanted to jot down a few pieces of invaluable advice you should take into account when you buy your home:

No matter what you may hear, real estate is not an investment.

Yes, many so-called ‘titans of business’ and ‘financial gurus’ will extoll the fiscal benefits of residential real estate, but in the end, a home is a place to live. It’s a place to raise your family and to make a life for yourself. It’s not equity.

Of course, purchasing a home is good for the overall economy. It supports home equity lending which in turn bolsters consumer spending. This eventually translates into returns for companies like Disney (think family vacations) and Home Depot (think home improvements). Yet, despite all the good it does the economy, houses are ultimately homes, not investments.

The idea that home ownership generates long-term gains for the average man or woman is mostly a misunderstanding. What you’re really buying is land. The house itself, the structure, is a depreciating asset that could end up costing hundreds of thousands of dollars in repairs and improvements. Just because you buy a house for $250,000 and sell it thirty years later for $600,000 does not mean you are seeing a $350,000 dollar increase in worth. In reality, the gain is far smaller once taking into account all the money you sunk into the house in the first place.

Real estate investors largely neglect this fact. In lieu of providing objective figures, they present home ownership as though it is buying shares in Facebook, or Google, or Tesla. In actuality, this is hardly the case.

Sale Contracts do not guarantee protection.

Unless a house is brand new, it will more than likely come with some material defects. Although these defects are often articulated in sales agreements, the language generally used leaves much to ambiguity. As a result, buyers can and do gain significant leverage to get more money out of sellers well after deals have been finalized.

It’s only right that sellers foot the bill for improvements and the like; but payment after the fact needs to be kept to a minimum. In the event you are selling a home, it may very well behoove you to hire a real estate agent lawyer who can add an addendum to your contract that protects you against potential attempts in the future to dip into your wallet.

Inspectors are not necessarily impartial.

The majority of inspections actually fail to show the full cost of needed repairs. This is because agents don’t want to advertise these costs. If a review of the home ends up revealing many flaws and potentially expensive repairs, the sale will probably not go through. Agents, incentivized by commission, will seek to hide these costs then by hiring inspectors who are likewise incentivized. This way, their report will not illustrate the full extent of costly repairs.

In order to circumvent this, buyers should hire their own inspector. By hiring a non-biased inspector, buyers are ensuring they will receive the most accurate report possible.

Buying a home is a complicated and stressful process. There’s no reason to let real estate agents make it worse by withholding information. Guard yourself and your interests. It’s for your home and your family, not your bank account.

Home Appreciation (Accele)Rates

Alec Shklyar, Growth, Real EstateJust as inequality is present in social and cultural sects of society, so too is it present in real estate. In fact, where you live can have an enormous effect on your future net worth. Right now, the United States’ most expensive residential markets are appreciating at faster rates than their less expensive counterparts. How fast? Two times.

Whereas in 1986, the average price in America’s most expensive market hovered around $127,058, it is now at $493,504. Comparatively, the average price of a home in the least expensive market was $52,022 in 1986. Now it’s $117,827. That means homes in the more expensive bracket increased at an incredible 320% faster than the less expensive markets.

That, in turn, indicates that buyers who were able to purchase more expensive homes previously have seen a much, much larger return on their investment, which further means that their descendants will have access to considerably more wealth than others. Thus, inequality is further bolstered in full force.

Additionally, this discrepancy is not likely to change anytime in the near future. If anything happens at all, it is bound to take generations. The influencing factors are simply so broad, so expansive, that to enact any real lasting change will be an immense project. The rising costs are primarily due to income growth and housing supply.

In more expensive markets, buyers have more money and more income. This means they can afford to buy more expensive homes. This ability then translates to higher competition and thus faster growth and appreciation.

Just as well, less expensive markets generally have more building activity, which means more supply, which means less expensive homes. So demand does not increase to the extent it would, say, in San Francisco, because more homes are being built, so there are more homes to choose from, and by extension less reason to push up prices.

If you’re looking to maximize home appreciation rates, these are the cities with the largest return since 1986:

San Francisco, California

San Jose, California

Honolulu, Hawaii

Seattle, Washington

Portland, Oregon

Oakland, California

Orange County, California

Los Angeles, California

San Diego, California

Miami, Florida

Real Estate is Back

Alec Shklyar, Real EstateIn the wake of the 2008 recession and the housing market’s collapse, millions of Americans were subject to foreclosures and penalized credit reports. Seven years ago, foreclosed home rates reached their peak, and now, those impacted credit scores are finally beginning to fade. What does this mean? Well, for one, it means more Americans can finally start improving their credit scores again, which means the housing sector has the chance to benefit enormously.

Ralph MacLaughlin, Chief Economist at real estate search engine, Trulia, puts two and two together, “Improving credit scores might entice households to start borrowing more in general.” This means that the housing market is increasing exponentially because there are many more prospective consumers. Not to mention, interest rates are much lower than traditional standards because of the significant reduction in activity since 2008.

So, decreased interest rates and more able consumers spell great news for the real estate industry at large. Additionally, there have been sustained gains in employment as well, along with bigger increases in pay, which gives prospective consumers even more capital with which to purchase homes and thus increase the housing sector as a whole.

Now, while this all makes crystal clear sense in theory, the numbers are a bit more difficult to quantify. What we do know for sure is that the number of consumers with a new foreclosure added to their credit reports reached a record-high in 2009 at 566,000. According to the three major players in consumer credit scores and reports, Experian Plc, Equifax Inc., and Transunion, foreclosures and short-sales (when a home is sold for less than what’s owed on it) usually roll off these negative reports seven years later. Considering it’s 2016 and the peak happened in 2009, that roll-off would happen right about…now.

This should manifest itself in a stronger demand for homes, which could mean higher spending on durable goods like appliances and furniture. Just as well, formerly afflicted consumers may also feel more comfortable applying for new credit cards, auto loans, and other various loans, which, overall, is good news for the economy (so long as the loans are responsibly approved). This credit repair could feasibly in and of itself aid people in repairing their financial standing by then reducing their borrowing costs, which would ideally free up money that could be used to further general consumption.

I suppose, to put it frankly, real estate is back. Interest rates are low; and I expect we will see a surge in homeownership very, very soon.

Real Estate 101

 

gold-real-estate-2I believe understanding the terminology in any profession is a key factor to succeeding, especially in Real Estate. There is so many important real estate terms to understand and even learning the jargon of real estate may be difficult to some.   It is important for anyone in real estate to have an idea of what they are talking about. Here are some real estate terms and abbreviations to start!

Closing

The closing is what every buyer enjoys. The equity of the property gets transferred over from the seller to the buyer

Closing Costs

Closing costs can be a variety of different things during the closing. Title Insurance, Broker’s Commission and Transfer Tax are just a few expenses that occur during a purchase

Real Estate Broker

A Real Estate Broker has important role in the Real Estate business. They are the ones who hope to bring the cash flow in by getting in touch with both buyers and sellers who want to make a deal. Once they get this to happen, they will then negotiate contracts between the two of them.

Real Property Tax Lien

A tax lien is imposed on an owner’s property by the government once the owner does not pay local and state taxes.

Title Insurance:

Title Insurance is a form of compensation insurance which insures against financial loss from defects in title to real property and from the invalidity or unenforceability of mortgage loans.

Contingency: A contingency is what keeps an agreement between a buyer and a seller from being legal until a plan that was spoken about it is met.

Listing: A listing is when a homeowner allows a broker to put their house on the market for someone to buy. The homeowner and the broker must come in full agreement of all the terms before it goes on the market.

Abbreviations:

3BR- 3 Bedrooms

1 LV 2 LV- 1 or 2 Living Area

4BR/3BA/2C – 4 Bedrooms/3 Bathrooms/ 2 Car Garage

FHA- Federal Home Loan

HVAC- Heating, Ventilation, and Air Conditioning

AICUZ- Air Installations Compatible Use Zones

ASB- Asbestos Siding

For more information, check out: http://www.realtor.com/advice/short-guide-real-estate-lingo/

Dallas Real Estate Rising to the Top

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At the top of the real estate list we have Dallas. Yes, Dallas- not its sister city Houston, which has been at the top of the real estate market for the past number of years. Dallas is extremely hot right now due to investors earning almost 20% unleveraged return for residential real estate investments. As of late, Dallas’ job market has become very strong, thus leading to a shift in the real estate market. In the past two years the city has added over 250,000 jobs, causing an influx of inhabitants to the city. The majority of jobs in Houston are tied to the energy industry, while jobs in Dallas are not. Dallas has more of the variety of different jobs to choose from causing more investors, young professionals, and citizens to want to migrate there. With the job market booming and young professionals flocking to the city, demand increases and local economy gathers the benefits of a growing population.  Another important reason why Dallas is on the rise is because of the surge of revitalization efforts.  These efforts will only benefit the city because it will draw more businesses and people to come to Dallas. They are transforming “bad neighborhoods” into valuable real estate for those looking to get close to the prime downtown cityscape.

Downtown Dallas is another reason people are flocking to the city. It is an awesome place to be around because you will never run out of things  to do. Many people enjoy the exciting nightclubs, or even a romantic dinner at one Dallas’ 4-star restaurants. If you are someone who loves to get those breathtaking skyline views I would definitely suggest you take an elevator to the top of the Reunion Tower for one of the best views in town.

Another prime real estate location to consider when you are in Dallas is the American Airlines Center, home of the Dallas Mavericks basketball team and the Dallas Stars hockey team. This is a premier sports and entertainment venue with seating capacities of 20,000 attendees for concerts, 19,200 for basketball, 18,000 for hockey, including 142 luxury suites. Thus, the American Airlines Center is equipped to host nearly any size event. This remarkable facility is one the bright spots in the landscape of downtown Dallas.

To find more information about rise of Dallas, check out

http://blog.memphisinvest.com/dallas-real-estate-rises-to-top-market-to-watch