Author Archives: Clay

What is The True Property Value?

Since ReMax Colonial deals exclusively with investment property, usually offering below market value opportunities, the issue of the ‘true’ property value is paramount. The market value is the benchmark and starting point for any sensible discussion of value.

But what is true market value and how do you establish it?
Firstly we need to understand the key distinction between residential and commercial property and how they are valued. If you are used to investing in traditional buy-to-let property then you may wonder why I even mention commercial investments. The world is no longer so black and white and understanding the different methods of valuation is critical for a full understanding of property. In recent years, the emergence of student accommodation, hotel rooms and storage units are three examples of property which buy-to-let investors can be offered, but which are valued very differently. So how is property valued? And how can you be reasonably certain that the value is correct?

Two types of valuation
There is a critical distinction to make between an ‘open market valuation’ and a ‘forced sale valuation’. The definition of an open market valuation is: ‘a sale between a willing buyer and a willing seller, allowing enough time for marketing.’ The definition of a forced sale valuation is: ‘a sale between a willing buyer an unwilling seller, not allowing sufficient time for marketing.’

These distinctions are important. The different valuations can be as much as 50% apart! At Select Realty Online we get involved with both valuations. We start with an open market valuation, then see what kind of discount we can force from an unwilling seller to provide our clients with property purchased at a ‘forced sale’ price.
The challenge is this – if enough property is sold in a local area at a forced sale price, it can negatively impact the open market value. Then getting to the true value can get difficult. As an investor you need complete clarity about whether you are talking about an open market or forced sale valuation.

Valuation of residential property
Here’s how residential property is valued. The following things are taken into account:
• Comparable sales recently achieved
• Current property listings
• Recent valuations that didn’t result in a sale
• Other factors which are impacting the area
• Adjustments for size, quality, location, time, age and more.
The valuation can be done in three main ways:
• Informally by a property agent
• Formally by a member of Royal Institute of Certified Surveyors (RICS)
• By an automated valuation system like Hometrack or Calnea

Valuation of commercial property: best methods

Commercial property differs from residential in many respects. It includes offices, factories, warehouses, shops and more. In recent years it has grown to include more affordable and manageable options such as student accommodation, hotel rooms and storage units etc.

You can’t get a residential buy-to-let mortgage to buy commercial property. If you are an investor in commercial property then you most probably either invest with cash, or have some form of commercial finance backing. As an example, I own an office building which is financed using a commercial loan from a mainstream bank. What is the main difference between residential and commercial property from a valuation perspective? It is the certainty of the future income stream. Most commercial property is either let on a long lease, or has a high degree of confidence in the occupancy as with student accommodation or hotel rooms.

Fluctuations in the local residential market will not have a direct impact on a commercial property valuation; and values are not negotiable and/or variable as per the residential market.

So how is commercial value established?
Commercial valuers typically choose to value based on gross rental yield. Why gross as opposed to net? Because unlike typical buy-to-let property which comes with expenses such as ground rent, service charges, insurance etc, the gross and net yields of typical commercial property are often very close.

Typically, commercial property is let on a full repairing and insuring lease (FRI) or an internal repairing lease (IRL). These mean the person or company renting the commercial property will be responsible for internal and external repairs and insurances; or, in the case of an IRL, everything from the windows inwards (as per shops in shopping centres, for example). Therefore the only investor expense (other than factoring in loan repayments, if relevant) for commercial would be a management fee, thus keeping gross and net yields close.

And, most importantly, if a lot of distressed property has been sold below market valuein the immediate area, it gets increasingly difficult for the surveyor to separate the true market value from a forced sale market value. In reality, the true market value is going to start falling if there is a concentration of below market value property sales in that area. This is an illustration of how your clever purchase of a distressed property can materially impact the values of property in that area for future vendors!

What Is A HUD Home and What Can It Do For Me?

Investors with an interest in US property have probably heard of HUD homes, but what are they and how can they benefit your own portfolio? In this article we look at the characteristics of HUD homes and how, as Select Realty Online investor, you can use them to your advantage.

What is a HUD home?
HUD is an acronym for the United States of Housing and Urban Development. This is a federal agency which reports directly to the President of the United States. Within HUD stands the Federal Housing Administration (FHA), a department which promotes home ownership in various ways, including providing loan guarantees to private lenders for making low down payment FHA loans to homebuyers.

How does it work?
The system is set out like this:
• HUD wants Americans to be able to purchase homes.
• FHA sets guidelines for what qualifications a buyer must have.
• Banks qualify homebuyers based on their criteria and give mortgage loans to homebuyers.
• FHA insures these mortgages, promising to pay back the lender if the homeowner ends up in foreclosure.
• Banks then see the FHA guaranteed loans as low risk and make the loans directly to homeowners.

However, if the homeowners are unable to make their mortgage payments the bank forecloses, cashes in on the FHA insurance guarantee and gives the house back to HUD. Like a lender, HUD does not want to own a real estate portfolio of foreclosed homes, so is keen to sell them on.

What can it do for me?
So, as an investor, when you buy a HUD home, you are purchasing a foreclosure. This means you get a cheaper purchase price, BUT HUD homes are sold ‘as is’. So, it is crucial you know exactly what you are doing to safeguard against buying a house in a state of disrepair and/or with liens (bad debts) attached to it. This is where Select Realty Online comes in, as our strategic US partners understand the US foreclosure market and ensure all property we offer and deliver is clean of title/liens and refurbished to a high standard. This is not the whole picture. When a HUD owned property is offered on the market it comes with a set of rules, set by the American government, about who can buy, when and how. This restricts investor access to HUD properties except in special situations which Select Realty Online understands and can help investors benefit from.

Where can I buy HUD homes through Select Realty Online?
Our primary US location to benefit from HUD homes is Memphis, where you can buy fully-refurbished houses from just $25,000 to $29,000. How? Through our exclusive bulk wholesale investment package which enables you to:
• Benefit from 20% net pa guaranteed income for two years.
• Potentially achieve up to 140% profit in, typically, three years.
• Work with highly-experienced US partners who know the market inside out.
• Participate in the bulk wholesale market with packages from just four properties (usually not available on packages of less than 100 properties!)
• Invest in carefully-selected neighbourhoods where growth and demand are strong.
• Enjoy a fully-managed US property investment.

Tips And Tricks On Getting The Legal Advice You Need

With so many lawyers vying for your business, it may be hard to separate the bad from the good. Keep reading to find out about hiring a lawyer.

Don’t just hire the very first attorney you talk to. Do thorough research for the wrong one can end badly.Ask around and look for as many people as you can on any lawyers you’re thinking about hiring.

Get a fee list of fees for any lawyer you interview.The fees will vary depending on a lawyer’s background, it is best to understand the fees prior to signing any agreement. You don’t want to have to dismiss an attorney who you are not going to be able to afford.

This is common practice among scammers and unscrupulous legal types; it is often seen when there is a scam where lawyers are simply looking for money. Do your due diligence and hire the best lawyer on your own terms.

Don’t just accept the first lawyer in the Yellow Pages as your choice! It is critically important to research your choices to ensure you are getting the best. You may even find out that you’ve hired a lawyer and end up losing your case.

You can speak up about a situation if there’s anything that you don’t like. Although your lawyer is representing you, keep in mind that your case is not the only one they are working on.

Do not hire a lawyer you are feeling unsure about them. This holds true with their fees as well. Do not give your lawyer a blank retainer check. Get an cost estimate so you can keep costs low and do not let the lawyer have control over your wallet as well as the case.

Your case may be put off by a lawyer if he or she is too busy with some other cases. Ask your lawyer up front whether they have time for your case. They must be honest with regards to their schedule so you’re able to find a lawyer who has the time you need to get the job done.

The lawyer can give you a better estimate if they know what all is involved in your case. Being efficient when dealing with lawyers can save you money.

If you don’t hear anything for days, they will likely treat you even worse once the lawyer is working for you.

Know your case before hiring an attorney. If you’re unsure of your issues, how can you find a lawyer that specializes in what you need? For instance an accident attorney. This will aid you make the right decisions going forward.

Look for information about the school your attorney. A better school means that they had to work harder for their education. A great lawyer can come from a mediocre school, but this information should play into your decision about which attorney to hire.

It can be time consuming to find a good lawyer. You should search carefully instead of choosing the very first lawyer you locate. This article gave you the advice you need, so make use of it today.

Steps That Will Make It Easy For You To Sell Your Home In The Real Estate Market

When it comes to selling real estate, you get what you put into the process. The sellers who do the highest profits. This article has many tips that will surely keep you informed as a real estate seller.

The most probable cause is your asking price and what potential buyers hope to pay for a home.Make up a price that everyone can be happy and the buyer will be satisfied with.

Set prices that are reasonable price when you sell your home.

Making inexpensive upgrades to your kitchen can improve your home more attractive and valuable. You may want to switch out one appliance to update the look and provide a focal point. Replacing the cabinets is costly, but a fresh coat of paint can give your kitchen a visual overhaul.

Negotiation will play a critical component of most real estate deals. If you want to make a quick sale, you may need to be flexible to the buyers requests, and take any fair offers that you get. If you don’t need to sell the home quickly, then don’t be afraid to hold out for the best possible offer.

Get rid of the clutter before you want potential buyers to find your home appealing.

Make sure your counter tops and appliances have clean surfaces. Also, keep floors swept, and that all bathrooms are sparkling.Make your children clean up their toys put away. Do not let dirty laundry any place where it can be seen.A nice and clean home gives buyers to focus on its positive aspects.

Open up all of your curtains before you show your home.Buyers like how a home looks in the sunlight. Lift blinds completely while pulling back the drapes or curtains. If the weather cooperates, try opening up windows to provide that fresh air feeling that could appear to prospective buyers.

You must have patience when dealing with your Realtor. Sometimes, they may seem to be the bearers of bad news, such as remodeling your house to improve its saleability. You will not always agree about the things they tell you, but in generally, your home will sell faster.

When selling your house, work with the potential buyer. You might not be able to get the price you want for your home. Ask your agent to help you to accept. Read up on the process of selling your home, find places like Keith Hamilton Real Estate Information blog to get a better understanding.

Before selling your house, make sure your landscaping looks beautiful.

Choose a Realtor that assigns a moderate and reasonable value of your home.

You may discover that you are in over your head. There are resources to help you if you choose to manage your sale yourself, but they often cost money and involve a fairly steep learning curve.

Many inexperienced people will spend an incredible amount of time and money on remodels that do no good. Focus on highlighting the most attractive features of what already exists to increase your profits.

Unless you are knowledgeable about the property type and market, you will have difficulty maximizing your profits. The advice you have read in this article will get you started, but there is still more you can learn. Strive to make even more money but taking advantage of all the information available to sellers.

Advice For Anyone Buying A New Home

Do you know everything about purchasing real estate? The article below will give you with suggestions you can utilize when thinking about purchasing real estate. Also look to articles from Keller Irish Wolfhounds, to get up to speed with buying a new home.

Be moderate in your real estate property.Many people want to be aggressive and get the best deal, but this doesn’t always work in their favor. Be firm in what you want, however, since they have experience with those types of negotiations.

Real estate agents should contact with former clients over the holidays and on the anniversaries of their home-buying. They will be reminded of how you helped them with their home buying experience. Give them a friendly reminder that you make money through referrals, and that it would be a huge compliment for them to recommend you to people they know.

If you’re relocating, you should look up information about the neighborhood using resources on the Internet. You can discover a good deal of information this way. Consider the population, population and unemployment rate of your desired location before purchasing a house there so you ensure that you will love where you live.

Homes that need extensive repairs or renovations are sold for cheaper than other homes. This gives you the opportunity to get in at a lower cost, and then you can make the repairs on your schedule. The home of your dreams might be waiting for you behind that ugly exterior.

If you are planning on having kids, you should consider the location of the house in relation to your preferred school district in case you decide to have children.

A lot of Realtors have ready made checklists of purchasing a home. The checklist can help ensure that everything before you go forward to make sure you have everything.

Buyers will often calculate the final closing costs by combining the amount for the down payment, any points that go to the bank, and the real estate taxes that are pro-related. In most cases though, the closing cost will include extra items like improvement bonds, such as school taxes, improvement bonds and other items specific to the area.

If you are looking at buying real estate as an investment opportunity, you should think about repairing and remodeling it. You’ll earn an instant return on investment and increase in property value.Sometimes your value will increase more than what you put in.

This is the best time to think of investing in property. Property values are currently at an all time low since the market has crashed. The housing market will rebound, so any investment you make will have returns.

If you are clear and honest in negotiations with the seller, it should be fairly easy to decide on a final purchasing price that you’re happy with.

Adding financial incentives to offers will make sellers less willing to negotiate selling price.

You should have developed knowledge from this article’s information to assist you in buying real estate. You may not realize that you could help someone get a better future, and they might remember it down the road and help you.

Discover The Secrets Of Successful Real Estate Sellers

There is a lot of reading material out there available for sellers in real estate, but that doesn’t mean even the majority of it is good advice. This article will lay out the important facts and advice that will help you get the best deal when you sell your property.

The effort required to keep surfaces painted, trim the bushes, and other small repairs can be a bother for many homeowners. However, neglecting the maintenance of a home can result in delays in closing on a home’s sale if a buyer insists that certain tasks be performed before closing, they will combine into an enormous amount of work that will have to be done before a home can be sold.

If you install energy star rated items, such as outdoor solar-powered lights, Energy Star-certified items, and solar motion lights outdoors, people may be more likely to buy the house because they can save a great deal of money not having to buy those things themselves.

When you are staging your home for viewings, try to empty out the home as much as you possibly can, even if you are still living in the home.

Have your home’s heating and air conditioning systems checked for proper working order before listing a home.Buyers generally do not want to buy a home that requires an immediate large investment, like a new furnace, so if the AC and heater are fine, it is more appealing to potential buyers.

Try to sell your first house before moving to your new house. Paying on two mortgages while your old house is on the market is a huge burden you might not be able to handle. The PG Real Estate Blog has wonderful articles to help you understand more about the purchase of property.

For a quick sale of your house, price your home around 10 percent below the lowest-priced comparable home in your neighborhood. The low price will entice potential buyers interested in looking more closely.

Select a real estate agent with care before selling your home.You should make sure the agent is experienced if you wan to buy or sell any real estate. An experienced agent with good credentials will help ensure that you home is sold quickly and at the best price.

Make sure your counter tops and appliances are sparkling. Sweep and mop your floors, and clean the bathroom. Make your children keep their toys put away.Do not let dirty laundry any place where it can be seen.A clean home gives buyers to focus more on your homes features without any distractions.

Open up all of your curtains before you show your home.Potential buyers will love to see how bright a home because of the sunlight through the windows. Lift blinds completely while pulling back the drapes or curtains. If the weather cooperates, try opening up windows to provide that fresh air feeling that could appear to prospective buyers.

Once you’ve got a good grasp of the information, it’s time to put it to use. Build a plan using what you’ve learned and don’t be afraid of the market’s conditions. Refer back here if you ever need to brush up on your tips and always remember to stay informed about the market.