Category Archives for "Real Estate"

Types of Commercial Real Estate Leases

Types of Commercial Real Estate Leases

Commercial real estate leases can vary significantly depending on the type of space and location. A business that leases space in the downtown area of a major city will have a completely different lease structure than a business that leases space in a suburban shopping center.

The following examples highlight some of the more common commercial lease structures:

o Gross lease: In this type of lease a tenant will pay a fixed amount for rent while the landlord is responsible for paying taxes, insurance and other associated expenses.

o Net lease: The tenant covers the base rent and a percentage of maintenance, insurance, and other operating fees.

o Triple-net lease: Typically written for a freestanding facility, the tenant pays all fees and expenses associated with the space.

o Shopping center lease: The tenant pays a base rate in conjunction with the square footage of the retail facility. Typically, the tenant will also pay some common charges and frequently a certain percentage of the gross sales. The tenant may also be assessed part of the property taxes. A shopping mall lease will often include terms about signage, hours of operations, common areas and deliveries. The landlord may also have the right to relocate the tenant.

o Land or ground lease: The tenant leases the ground itself and usually builds on the property. In the majority of land/ground leases, all improvements to the property including development of infrastructure and facility construction will revert back to the landowner when the lease ends.

Keep in mind that there are a number of variations on these types of leases. One example is if a company wants to lease office and warehouse space within the same facility. They might sign a universal lease that stipulates separate rent and lease options for both spaces.

Source: Ezinearticles

A Guide To Successfully Buying Property

Buying a property, whether it is your first or fiftieth time, is a stressful process. For most people, buying real estate represents the biggest financial decision of their lives. Because there can be so much riding on this one purchase, it is imperative that you do the correct research and follow the correct procedures – a failure to do this can mean financial disaster.

Below is a brief guide to buying residential property. Consider this guide a starting point for your own research into buying property – information is your best friend in the real estate game!

Research

Research forms a solid base for any major purchase and the good news is, that you are doing some right now by reading this article! There is a variety of information you need to gather about your desired property and the local area before you commit to buying.

The first thing you need to do is look at the historical sales results for the suburb you wish to buy in. It is very likely that in the last few years a house very similar to the one you wish to purchase has been bought, or sold, in the local area. By comparing the historical prices paid to the current asking price, you can start to build a picture of the local market and decide if you are getting a good deal.

The next thing you need to seriously research, is the properties boundaries and any limitations on the use of the land it sits on. As people rebuild fences and conduct home improvements, the official boundaries can often be compromised. It is important that you are aware of the exact boundaries of the property you are purchasing – you can’t just rely on what your eyes tell you! In addition to this, local councils often place provisions on the use of residential land, such as specifying drainage areas and wildlife corridors. You can contact the council responsible for the suburb you wish to buy in to find out more about any land use limitations.

Inspections

Once you have done your research on the local real estate market and selected a property that you feel is a good deal, you need to start scheduling more in depth inspections. For this, you should hire a qualified building inspector. They will go over the property with a fine tooth comb, finding any major or minor faults, which may compromise the structural integrity of the house now, or in the future. If a house has faults, this doesn’t necessarily mean you shouldn’t buy it. However, you need to consider how much repairs will cost when deciding how much you will offer for the property.

Financing

Before you even start looking, you should have finance arranged. By knowing how much you have to spend, you will be able to focus your search on properties that you know are in your price range. Without positive confirmation of finance, you could just be wasting your own and everyone else’s time by looking at properties to buy.

Source : Ezinearticles

For more information please visit http://bit.ly/propertymillionaireintensive

Why Lease Options Work in a Bad Economy

In a bad economy, the real estate market usually is the one of the first to shows the signs of distress. There are certainly no real estate investing secrets about the fact that people are not able to get credit, they have lost their jobs and everyone is struggling. It really is not the best time to be entering into a huge financial obligation like buying a home. This means sellers start to get desperate and more homes flood the market as people need to sell or risk losing their homes to foreclosure. There are not enough of buyers. Banks make it even more difficult since they stop lending and start being very picky about whom they lend to. This leads many sellers to consider a lease option on the property. For an investor, this could be a great opportunity to make a nice profit with a lease option agreement.

Why a Lease Option Works

This is the one reason of the real estate investing secrets that works in a bad economy is that there is no lender involved. Instead of making a deal with a lender on a mortgage, it is just the seller and buyer making the deal. The seller agrees to sell the property to the buyer at the end of the lease term and the buyer agrees to pay the monthly lease payment each month until the agreed upon date when they have the option to buy. It is important to note that, if a buyer doesn’t decide to buy at the end of the lease then they do not have to. But if the buyer wants to buy, then the seller must sell for the buyer.

Why This Works For Investors

Investing is real estate when the market is rough is not always the best financial situation. Many investors suffer some great financial losses since it becomes difficult to sell the houses that they have bought. With a lease option, the investor can rent out the property during the lease, which means the renters will pay the monthly lease payment for the investor. At the end of the agreement, if the market has not rebounded and the investor sees no possible way to sell, they can walk away.

Some Things To Keep In Mind

If you choose to move forward, this is one of the real estate investing secrets there are some things you will want to keep in mind so that you come out on top of this deal. You need to make sure that the monthly lease payment is not more than what you can reasonably charge for the rent on the property. You also need to do some research on the area and to make sure that in a good market that you will be able to sell the property. After that, also be sure that you have the potential renters lined up so that you won’t be stuck with the house sitting vacant and having to pay the monthly lease payment.

Finally, there are many ways you can lose money on real estate investing during a recession, but you may trying out lease options because it may actually help you come out on top. Then you may be able to make it through the recession without losing anything and actually making a profit with this creative investing idea. And there you have another of the real estate investing secrets.

Source : ezinearticles

Lease Option Real Estate Investment

Lease Option Investment

A lease option is basically a rent-to-own contract for a piece of real estate. The buyer signs an exclusive contract to have the buying rights to a property after a given amount of time. When the allotted time expires, the buyer can do one of two things, that are buy at the price agreed on when the contract was signed, or don’t buy the property and forfeit down payment.

To make this easier, let’s take a look at this from a buyer’s eyes.

Buyer

Why would anyone use a lease option for real estate investing? Try risk management. If you were shopping for a home a few years ago (before the market went bad) but were unclear if the area would be hit by recession, you could use a lease option to pay monthly rent and then wait for the contract to expire. The next step is you would be to get the property appraised. As a buyer, a lease option means that you do not have to buy the property. So when you look at the home appraisal after a few years, you compare the current market value to that of the agreed upon purchase price. If the home is worth more than what you agreed, you can purchase it and gain instant equity. But, if the property went down in value, then you can leave the deal with no ties and are only lose the down and monthly payments.

Now, let’s talk about the seller.

Seller

During these poor economic times, it’s very difficult to sell your property since there are many sellers polluting the market and increasing the number of unsold houses. The excessive inventory lowers overall prices. Now, for some reason, so you need to sell your property as fast as you can and fast or cover the payments. Lease options can do both and here is how. Thanks to the financial education available, many people want to buy a home but do not have the credit or the full down payment that needed to buy a home. These people are ready and willing to buy a property but they can’t get a bank to look in their direction. Hence why a lease option for a low down payment that accepts medium to poor credit has such a strong customer base.

Finally, lease option real estate investment is a rent-to-own strategy that works through signing a contract for exclusive buyer privileges at the end of the agreed upon time period for an agreed upon amount. This contract can be very easily work to the benefit of both the buyer and the seller, and allows for property sales at your asking price even in recessed markets. So i suggests that lease option real estate investing should definitely be considered by either the investor, the buyer, or both.

Source : ezinearticles

How to Make Money Using Lease Options in Real Estate

There are a lot of different ways to make money in the real estate world. you’ll get into the flipping part of it, the agency selling part, or even the leasing part. when people think about making money investment in real estate for the most part they’re looking for a way to make a large amount of money all at once. This need for the large sums is why flipping and becoming an agent are the common courses of real estate investing. making money using the leasing option can bring in a steady cash flow but you may get it in payments as opposed to one lump sum.

Leasing homes and apartments allow you to provide a living arrangement for families that need them. Since you own the homes or apartment building that you are leasing out you will be able to set the worth that you want your tenants to pay. ensure that you set the prices so that they’re reasonable or you can have problems finding occupants for your space.

Leasing commercial real estate is another great way to make money. find a building that’s easily accessible. you will want a building that’s around different successful commercial buildings. A building that has plenty of parking and space are more desirable than one that doesn’t. If the commercial property is in a very desirable space you will have no problems filling it. Once you have someone operating your commercial property you’re guaranteed to have a steady monthly income.

While most people assume that you have to either flip or become and agent to make money in real estate, the truth is that you will supplement your income quite nicely and permanently with the leasing option. Leasing real estate is a great way to play in the real estate game without having all of the loose ends to tie up in the flipping world, and all of the classes you have to take to become an agent.

Source: ezinearticles

The Common Problem of Least Option to Avoid

Nowadays, many investors very love lease options. This is because this type of real estate agreement can be a low risk investment that allows you to make a nice profit in the end. It is a wonderful option for a new investor who doesn’t have a lot of capital to work with or for an investor that wants to get started slowly. It just because of lease options are popular does not mean they are hassle free. No real estate deal will ever be completely without its problems. If you are interested in lease options then you should listen to the following warnings. The following are the ways to avoid common problems that investors have with lease options.

Check Out the Seller

For investors, you must always check out the seller and make sure that the current mortgage is in good standing. If the seller has missed any payments or if there is a threat of foreclosure, then you must not to continue with that sellet. You must also check on taxes to be sure there are no back taxes. You could end up being the one responsible for paying any money owed or in the worst case scenario the house could be pulled out from under you by a bank foreclosing on it and there will be nothing that you can do for it.

Hand Out Disclosures If You Sublease

Even if you do not own a property, but you are renting it or subleasing it, you have the responsibility to hand out federal and state disclosures. This includes informing tenants about lead-based paint, which is mandatory if the house was built before 1979. Before you sublease the property, you must make sure that you know about what your legal responsibilities are regarding disclosures.

Don’t Sign a Contract That You Don’t Completely Agree With

Too often investors think a lease option contract is set in stone. You have every right to negotiate. You can negotiate on all points. You must make sure the contract is exactly how you want it or don’t sign it. You probably don’t have to worry too much about the seller walking away because in the case of most lease option situations, the seller is at their last resort and need someone to buy this property. You are in the position of power in this deal, so take advantage of that and get a contract that will makes you happy.

Know Your Rights

Every now and then there is a seller in a lease option who ends up not going to sell. It is important to recognize that you have the upper hand here. The lease option contract states the seller must sell. It is not an option for them. You are the one that has the option to buy or not to buy. If a seller tries to back out when the time comes for you to buy the property then you have every right to sue them for ownership and in most cases you will win the fight with no problem.

Finally, so if you are prepared or ready before entering into a lease option, then you should have a good experience. Most of the investors who have sworn off lease options have done so because they were not prepared or they did not understand the lease option process. So, you must be smart and know what the process involves and you should come out good in the end.

 

Source : ezinearticles

Important Things To Know Before Buying Property

Property laws vary from state to state but there are general guidelines real estate buyers would do well to know before investing in property. It isn’t simply a matter of having enough money to purchase real estate: you want to make sure it doesn’t turn out to cost more in the long run.

The value of property appreciates if it’s structurally sound, has essential amenities such as electricity, plumbing and water supply and is located in a neighborhood with easy access to hospitals, schools, colleges, transportation hubs, offices etc. Location is so important that it’s often the single factor that influences resale value.

Can you build a house on land?

You may have found a nice plot of land to build a house on. But can you? Some states have zoning restrictions on building houses and finding out what the laws are will eliminate expensive problems.

Know that buying land and building a house will cost a small fortune. Construction isn’t cheap especially when building for a family. The cost of materials is high and you’ll have to find a trusted contractor to advise you along the way.

Visit a house/land several times a day

When house-hunting, it’s wise to visit properties several times in the day. Evening and night visits mask problems with the house, noise levels of the neighborhood and intensity of traffic. Some buyers may be looking for a quiet street but won’t be able to tell the difference at night.

If land is being purchased, find out how close it is to amenities and whether there are any upcoming plans for commercial real estate construction. Some buyers inadvertently find themselves stuck in the middle of a commercial hub they didn’t anticipate would be built. Noise, traffic and crowds can mar the peacefulness of any location.

Do a house inspection

This is a vital part of the house-hunting process and the services of an inspector are required. Obvious problems like chipped or broken stairs, faulty doors and windows and peeling paint are cheaper to repair than those you can’t see. Inspectors may use tools like thermal imaging and draw on their expertise to pinpoint problems with insulation, plumbing and unsound foundations. The cost of an inspection isn’t very cheap but is a lot less expensive than being saddled with big repair works later on.

Check taxes

Some areas reappraise housing tax so it’s important to find out what the recent taxes are on a house. If you purchase property at a good deal only to be bogged down by rising taxes every year, you’ll take longer to pay the mortgage and the cost of maintenance will rise.

Check past renovations

The seller you approach may have made renovations to the house in the past. If this is the case, find out what it cost and what improvements were made. The cost will tell you if quality materials were used. Find out the date of the renovations as well to give an idea of whether you’ll need to make further improvements in the near future.

Don’t buy for short-term stay

Buying a house cost much more than renting one, at least for short stays. Don’t make the mistake of purchasing property if you don’t intend to live in it for at least several years. Paying off a mortgage takes time and a year or two isn’t enough for most people.

Source : Ezinearticles

For more information please visit http://bit.ly/propertymillionaireintensive

 

Should You Buy Property On Leased Land?

Most people who are searching for a home to buy don’t realize that it is possible to buy a home on leased land. Far from being an uncommon practice most people assume that when you buy a house you also purchase the land it is built on, but more and more non-traditional home buying options (like purchasing a home on leased land) are becoming available as the economy and housing markets continue to struggle.

Here are a few things to know about buying a property on land for leased as well as some pros and cons to help you decide if this is a viable path for you to go down in your home buying journey.

When looking at homes for sale you can tell if the one you are interested in is on leased land if the advertisement says something like ‘manufactured home’ or ‘leasehold interest.’ Also be aware of the word ‘association,’ which will be used to describe areas of the property that you have not explicitly purchased yourself. The price for a home on leased land will also be much lower than the average market price for other similar houses in the area. Leased-land properties are generally built close together and rarely have amenities like a private pool attached to them.

Mortgages are taken out on land for leased properties, but a monthly payment will likely be lower because the original purchase price was cheaper. A fee that you wouldn’t normally have to pay for a traditional home is a land lease fee, which will vary by property. You may also find that some leased-land properties have massive home owner’s association fees that are used to cover the upkeep and maintenance of the leased land areas.

If you are considering buying a property on land for leased it will be beneficial to come up with an outline of your budget for a regular property and for the leased-land property. When you write down the savings and additional fees for both you might find that one is a step above the other when it comes to benefits and price (and it might not be the property you think!). Be reasonable when it comes to assessing your financial goals in the purchase of property, leased-land or otherwise.

You will also want to find out from the owner or realtor how much time is left on the lease. Generally you want to look for properties with a long lease left as you won’t have to worry about the changes that will occur if the lease ends while you are still living there. If the lease is shorter you might find it difficult to get a mortgage and finance your home. If the lease is up soon and you decide to purchase the property anyways, make sure you know what you will happen to the property when the lease ends.

Buying a home on leased land could be a sound financial decision, but weigh your options before you rush into anything.

Source : Ezinearticles

For more information please visit http://bit.ly/propertymillionaireintensive

Why Strata Title Is Important For Property Owners?

What is strata title?

Strata title is one of the title structure of ownership and it basically gives you the privilege to control over a property or a piece of land as well as enable you to transfer the property to others. A simple example, you bought a pen and you get a receipt and it prove that you are the owner of that pen.

Its generally apply to high-rise buildings such as residents of flat, apartments, condominiums and commercial building jointly developed within a development that shares common facilities such as gated & guarded, security, car parks and facilities governed by a common contract of mutual agreement. Under the Strata Title Act 1985 developers are required to apply for the strata titles on behalf of the purchasers.

Apart from that, the strata title would enable the residents to form a Management Corporation (MC) to run the management and maintenance services of their property.

Sell property without strata title

Should you have no strata title in your hand and you wish to sell your property, you have to arrange an extra money to pay stamp duty as well as the consent fee for developers.

Some of the developers are resist to apply for strata titles for the purchasers, as they can make extra money after projects are completed by forming their own Management Corporation (MC) and collecting maintenance and other miscellaneous fees from residents.

So, it is important because once you have your title you have certain rights and privileges.

Importance of Strata Titles

The House Buyers Association’s (HBA) advise to house buyers is to “get, keep and preserve” the strata titles to their units for the following reasons:

  1. As ultimate proof of ownership
  2. As a dealing instrument for instances of charging to banks for loans
  3. To facilitate disposal of proeperty should they wish to sell it,  so that they no need pay the consent fees to the developer
  4. To be able to get involved when the Management Corporation (MC) is formed by owners of the units in the subdivided building to maintain and manage the property
  5. As final proof of the built-up area of your unit and ultimately your apportionment of the share in the total aggregate units
  6. As long as the strata titles have not been transferred, the land and the common property are still owned by the developer. Should the project being abandoned (as the developer company goes under liquidation or becomes insolvent) before strata titles have been obtained, the unit owners would have to go through a lot of trouble or might eventually have to pay for the application of the strata titles themselves

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive

Pros And Cons Of Lease With Option To Buy A Property

In today property market, you might heard people said a lot about purchase home with lease option. If you are an existing property investor, this strategy may not strange to you while if you are newbies, what do you know about this strategy actually working?

Whether you are existing property investors who going to purchase your next property by applying lease with option or the newbies who trying to use this strategy to purchase their first property. Perhaps you have do the research regarding the lease with option. But today, we are going to remind you again the pros and cons of of lease with option to buy a property.

Pros And Cons Of Lease With Option To Buy A Property

Advantages:

👍 It helps buyers with no down payment to build up a down payment while still enjoying the comforts of being in a house with land.

👍 If agreed upon by the owner, you can make changes and improvements to the property but still have large maintenance issues covered by the landlord.

👍 You can get to know the neighborhood and neighbors before signing the dotted line for ownership. I am sure some of you can attest to buying a house, then realizing that the neighborhood wasn’t as safe as you thought it was or your neighbors turned out to weirdos.

👍 It will be very easy to document your prompt rental payment history to a mortgage lender if they need additional documentation to help you qualify for a loan. Sometimes, those with damaged credit, foreclosures, or bankruptcys on their credit can receive approval for a mortgage if they can prove steady, substantial income coming in and a flawless two or three year history of rental payments.

Pros And Cons Of Lease With Option To Buy A Property 2

Disadvantages:

👎 Generally, lease-to-own house agreements will come at a premium price. Generally, a landlord will draw up a lease that will include a portion of the rent that goes to the landlord and a portion that will go towards your down payment. The landlord should offer the fair market value for another rental house of that size in the area, plus whatever extra you want to pay on top of that to go towards your down payment. However, some landlords will try to ask for more rent than what is normally considered “fair market” for that area, which means your paying more in order to save towards a down payment with no interest.

👎 You might decide that you don’t want the house, and then your stuck in a lease with possible penalties for not buying it.

👎 The Federal Housing Administration limits the amount of rent that you can apply towards a down payment if you look to buy an FHA loan. With conventional mortgage loans for a bank, there are no restrictions or limits other than what is agreed upon in the lease agreement.

Here is our advice, if you have found the property that in your price range, do ask the landlord whether they willing to accept the deal of lease-to-own. It is to make sure that they’re agree to working with you on the agreement’s terms. However, if you feel bad of the deal, do discuss with your solicitor or stop the buying process right away. (always believe your intuition) It is to prevent yourself from any legal issues.

Source: WMAPROPERTY

It’s not about property ownership it’s about control! To get more details, visit 👉 Property Millionaire Intensive