Character and Reputation Remain
Even Dummy knows when he is not being treated right. Long after the deal is done, your reputation and the way you treated other people will linger.
Investors are not required to maintain a particular degree of ethics in their business practices. Yes you have your self-interest to look out for, but you are also your brother’s keeper. It is more than just operating within the confines of the law.
It is often easy to take advantage of a situation, but most successful investors, and especially those who want to remain working with customers for a long time maintain high ethical standards.
Realtor’s are bound by a code of ethics. Lenders and agents must be licensed by the state. There are rules and standards in place designed to protect a buyer or seller. There are stiff penalties in place for anyone who violates the law. Read the rest of this entry
Know your Market
It is easy to acquire an in-depth knowledge of your selected market. Look for key traffic routes, major employers and population centers. Then over lay that with information on medical facilities, educational institutions and market centers. Review local industries that make up more than 20% of the local economy, i.e. agriculture, high tech manufacturing or lumber as an example.
Information is the raw material of the information age that we live in. Making a sound business decision will be easier when the current trends are understood. Mortgage rates, vacancy factors, consumer spending habits, unemployment data, and major economic segments that make up 85% of all economic activity. Knowing this about a community is very helpful. Demographics will tell you about who your customer is likely to be. Read the rest of this entry
Treat Investments as a Business:
Short and long term goals need to be established going into a deal. A business plan allows real estate investors to:
- Identify objectives
- Set time line for expectations
- Determine costs to carry, income and net spendable
- Allows for BIG picture view and focus on goals rather than minor glitches or short term set backs
Real estate investing can be complicated and demanding. A basic plan at the time of acquisition can keep an investor organized and on track.
that is what any investor should be looking at regardless of the investment. In real estate one way to measure this is called capitalization rate and it is easy to remember it if you can remember an old Dummy named IRV.
I = Income
I = R x V
Two thirds of U.S. families own a home, says the Federal Reserve. A home represents about 2/3s of the a typical families assets. Most people focus on what their home is worth and want to know what the fair market value is (FMV) and when the market will hit bottom. In a market like we are having in 2012 people fret about what they have lost in equity if they have owned their home a long time.
Read the rest of this entry
When you first start out,
you will probably need to use someone else s money.
The Rich Real Estate Dummies call this
The question in the mind of most dummies is;
“Why would other people let me use their money”?
The answer is that all of us entered the world with a bank of time. All of us are able to bring an energy or effort to a task, we call it work. As we use our time and our energy we are able to exchange it for money. Everyone has this opportunity when they start out.
Some people are really good at it and use their time and work to make a lot of money. They end up with no time and lots of money. It’s not the best way to balance your life. They know that they could use their money to replace the time they lost.
So the formula looks like this:
Time + Work = Money Read the rest of this entry