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How to ensure a Successful Investment Deal? – Tips for High Net Worth Investors

Property Investment Portfolio and Purchase Costs

Many mortgage brokers, lenders and banks do not have the required comprehensive knowledge about all the types of funding structures required by High Net Worth Investors who are looking at buying real estate property, and in particular if you are also looking at financing the arrangement under a trust structure. So, you should take time to seek expert advice from a professionally qualified finance broker as he/she can help you “structure your property investment finance” and create an investment portfolio. To help you during the decision process, here is a list of things to consider and which you should discuss with your finance broker:

Borrowing Power – To help you determine the amount of debt you can take on, your finance broker should be able to determine the extent of your borrowing power (i.e. ascertain how much you can borrow?).

Loan Comparisons – To help you make simple loan comparisons, your finance broker should provide you with a list of finance products and options.

Rental Income – Your finance broker should discuss how rental income can cover the total costs of your investment property.

Purchase Costs – You should consider some of the typical purchase costs, such as loan establishment fees, conveyancing costs and stamp duty. Lenders Mortgage Insurance (LMI) premium can also be payable if the total amount you are borrowing is more than 80% of the total security value of your property.

Property Investment Strategy – To devise a suitable optimum property investment strategy, your finance broker should understand your financial position by working closely with your accountant and solicitor.

Loans Under Trust – Your finance broker should be able to help you in choosing the best trust loan option.

 

Useful Tips

So, now you know how choosing an experienced and professionally qualified finance broker can help you to create a successful and highly efficient funding structure. Here are some useful tips to also consider:

Taxation and Legal – Speak to your accountant and solicitor to take advice regarding:

>> Financing under a trust structure as trusts can provide advantages like asset protection and tax benefits

>> The benefits of negatively gearing your real estate investment property

>> The range of property investment tax deductions you may be able to claim

Personal Income and Expenses Budget – To enable you to determine the extent of your financial situation, establish a budget of all of your income as well as working out all of your expenses.

Find a Suitable Property – Have a clear idea of the type of real estate property you want to buy and its location.

Pre-Approved Finance – Discuss the possibilities of pre-approved finance with your broker because pre-approved finance gives you the assurance of credit.

So, if you are a High Net Worth InvestorHealth Fitness Articles, keep these tips in mind because they will ensure a successful investment property deal.

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Investment Property Part 2 of 2: What You Need to Know Before You Buy

There are three basic principles of investment property that you should know before you buy an investment property in order to avoid overpaying:

Time

How long do you plan on owning the investment property? As with stocks and bonds, the value of your investment may change significantly during the time you own it. While most real estate will appreciate in value over time, there are frequent fluctuations in the short-term market. If you plan on selling your investment property after less than five years, be prepared to accept the investment risk inherent in a shorter time horizon. This is especially true if you bought your property in an overheated real estate market. If this is the case, you could find yourself losing money if the market has taken a temporary downturn, especially if you’ve had to make major repairs to the property.

If you plan on owning the property for the next twenty to twenty-five years, it’s almost certain that your investment property will appreciate in value. There’s also a good chance, however, that you’ll have to make major repairs like replacing the roof, wiring system, or major appliances like a water heater or refrigerator. Of course, these repairs will be offset by the fact that you’ve had/will have twenty plus years to recoup the cost. If on the other hand, you’re only planning on owning an investment property for the next five years, buying a “fixer up’er” can eat up all the profits you would have made during your shorter investment horizon.

Networking

If you want the best deal possible on an investment property, than there are some people you’ll want to be friends with City hall clerks and bank employees may know what properties will be available on foreclosure and when they will go on the market. Real estate agents usually know everything real estate related within their respective territory. Some prospective landlords even run ads in local newspapers.

Many individuals interested in entering the investment property market may even join local landlord or investment property owners organizations. These types of organizations hold regular meetings where you can get the inside scoop on what’s for sale in your area. The National Real Estate Investors Association is an online organization that provides a wealth of information and resources to potential investment property owners.

Financial Preparation

Get your finances in order. The less debt you have when you walk into your local lending institution, the better loan you’ll get. This is common sense, but it’s even more true for those seeking financing for an investment property. This is because lenders know that people are much more likely to default on a rental property than on their own homes. This means that the bank will demand a larger down payment and higher interest rates that you may have expected. It’s also a good idea to have some extra cash left over to make unforeseen repairs should they arise.

By wisely choosing an investment property time horizon, making contacts in the investment property community, and preparing proper financial meansPsychology Articles, your investment may become a significant means of supplementing retirement and other savings accounts.

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Investment Property: How to Increase Value

The real trick is to raise the value of the house without paying too much and thus eliminating your profit margin, or spending so much effort and time that you lose other opportunities to make money.  What follows are some quick, cost-effective ways to raise property values.

Begin with the most obvious: make the house look more pleasant, new, and sturdy from the outside.  A new coat of paint can do wonders. Give the house some curb appeal by brightening it up with a few flowering plants, either potted on the porch or neatly replanted in the yard.

Now let’s discuss decorating the inside.  Notice how many homes up for sale look unlived-in, despite having some (obviously unused) furniture and fixtures in them?  This is not a flaw in the decoration; it is deliberate.  If a house looks like it is being or has just been used by an actual resident, a buyer might feel like an intruder, particularly if the house is a foreclosure or REO property.  Light colors and a pleasant, but rather generic atmosphere are your guidelines.

Furthermore, make sure to conduct important repairs.  Clogged plumbing and malfunctioning ventilation can keep the value of a house low.  While you are at it, you might even make some additions: think of them as “bonuses” to attract customers.  Try to improve the house’s insulation, for instance.  Nowadays, people often want to conserve energy on heating and cooling their residences, both for financial and environmentalist reasons.  Make your property stand out from the rest by marketing it as “green”  real estate.

Furthermore, do research about future development projects in the area.  After all, if somebody wants to live in that house long-term, the future of the area is of concern to them.  If you find out about new schools, shopping centers, etc. that will soon be constructed nearbyBusiness Management Articles, you can more easily convince buyers that they are investing wisely.

Try these tips in order to make great returns on your investment!

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Investment Property: How Not to Become a Slumlord

Rule #1

Location, Location, Location. Ok, thus this may appear to a small degree cliché, however it is a proven fact that the situation of your investment property can confirm the styles of tenants you may attract, and the way a lot of rent you’ll fairly charge. Remember, at some purpose in time within the future it should become necessary for you and your family to measure there; what quite neighborhood does one need to be in?

Rule #2

Don’t go overboard once you are fixing up associate degree investment property. You got to expect cheap wear and tear. confine mind that ‘reasonable wear associate degreed tear’ suggests that one thing entirely completely different to an individual whose rental than it will to an owner. And for goodness sake forget the, “We square measure Family” hand towels!

Rule #3

Know how to form basic repairs. fortunately for mountain and sons that they had quite little bit of expertise in varied construction trades. Otherwise they’ll have lost even extra money than they did through hiring out facilitate. Knowing a way to fix electrical wiring, repair drains, and replace windows can prevent quite little bit of cash down the road.

Rule #4

Screen your tenants as if they were getting to measure with you. this might be the foremost vital step to avoid changing into a slumlord. arouse and check references. decision previous landlords and raise queries like, “Did they pay rent on time? however was the condition of the house/apartment once they left? Did they ever disturb neighbors with loud music or yelling matches? however usually would you’ve got create|to form|to create} special journeys for untimely repairs?” Being as au fait as potential concerning World Health Organization you rent to can make an enormous distinction within the profit of your investment property.

Rule #5

Know your rights as a landholder. Be conversant in the eviction method so as to avoid long, drawn out disputes with tenants. Most states and counties give on-line data concerning tenant and landholder rights.

Don’t repeat the mistakes created by mountain and his sons. GrantedFree Articles, moving into the investment property business takes exertions and you may ought to place up with stuff you ordinarily would not place up with. At constant time there square measure steps you’ll go for limit your liability whereas preventing yourself from changing into a ‘slumlord’.

In the next portion of this two-part article we’ll be discussing a number of the monetary aspects you ought to be conversant in so as to seek out the most effective deal potential on your 1st investment property.

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