What to Ask When Looking for a Good Property Manager

What-to-Ask-When-Looking-for-a-Good-Property-Manager

If you’ve ever searched for a good property manager before, then you know how difficult it can be to find a good one for your rental property. There are several property managers out there, probably more than what you really need to bring your property into the market.

With so many choices available, you may find it difficult to choose one for your unit. But don’t worry – if you ask the right questions while shopping around for property managers, you’ll get a better idea of who would make the best fit for your property. Ask them these questions when discussing your property to see if they’re the right property manager for you:

1. What type of properties have you managed?

Experience counts for a lot in property management, and it can separate the good ones from the ones you should steer away from. Experience in this field, however, isn’t just about the number of years worked in the field; it’s also about what type of properties they’ve managed. Depending on what type of property you have, you can either go with someone who specialises in managing properties like yours or someone who has more varied experience managing different types of properties.

2. How do you screen potential tenants?

Screening potential tenants is one of the most important steps to property management, so the way they do this often reflects their level of service to your property. Ask them how they’ll match tenants to your property and what their process is like for finding tenants. This will give you a better idea of how they operate and what lengths they’ll go to find the right match for your property.

3. How do you handle late payments by tenants?

Finding tenants is just one phase of property management; the longer phase involves managing the tenancy itself. Asking them this question will show you what their management style is like and how they’ll deal with critical rental issues like these. See if their process aligns with what you expect them to do and how you want your property to be managed.

4. How do you respond to complaints?

Similar to the previous question, this question allows you to gauge how well a potential property manager will handle the landlord-tenant relationship. Remember that a property manager will act as the mediator between you and your tenant, so it’s important that you’re comfortable with their process for dealing with any complaints or issues.

5. How often do you do inspections?

Routine inspections are important to any tenancy agreement, and the number of times it’s done per year will help give you better peace of mind as the landlord or owner. This question will also show you how well the property manager will look after your property even after the start of the tenancy.

6. What’s the right rental price for my property?

If you’ve done your research beforehand, this question will let you assess how well a potential property manager knows the market and what they can offer you. It also allows you to get a better idea of what your property is worth in the current market. Compare their answer with different property managers to see what they offer and to better understand where your property stands in the market.

7. What are the things I can do to improve my listing?

Asking them this question won’t just reveal their expertise in property management, but it’ll also help you put your property in the best position in the market. Note their suggestions, assess how relevant they are, and decide whether or not they can get your property where you want it to be.

8. What are the full costs and fees for managing my property?

Some have small sign-up fees but a variety of hidden fees once you sign on and let them manage your property. Avoid getting surprised by such fees, and ask them to indicate all management and service fees included in their service. The more complicated their fee structure is, the bigger the headache (and expense) it will likely be.

9. What can you do that others can’t?

This is where prospective property managers will try to sell you on what they offer and how well they set themselves apart from the competition. It’s also the part where you assess the intangibles in any working relationship, giving you a better idea of how well they meet your standards. Listen well, take notes, and assess if they provide what you’re looking for.

With so many choices available today, finding the right property management company can be difficult. But by asking the right questions and doing your research beforehand, you’ll find that all the hard work you put into finding the right manager will be worth it. Once you find the right one, your property (and wallet) will surely thank you.

Article Source: http://EzineArticles.com/9685653

Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

What You Should Know Before Flipping A House

What-You-Should-Know-Before-Flipping-A-House

Many individuals believe they can flip properties effortlessly, however it is likely they will be dissatisfied with the preliminary outcomes. A profitable flip is one that you generate income and there are many steps you must follow to help you to become successful.

For house flippers, there’s recently been a great deal of news of late, since houses flipped throughout the first half of 2016 produced a median gross revenue of around sixty thousand, the greatest median gross flipping revenue since 2005, the highest it has been in 10 years.

However gross revenue does not contain the expenses to rehab the home, which generally contributes an additional 20% to 30% on top of whatever the preliminary purchase price of the house for the flipper is. Flippers are competing for business with not just additional flippers, but additional homeowners who would like to renovate their residences that they plan to reside within as well.

Although it appears backwards to believe the money is created on the front end of the offer instead of the back end, that’s merely how an experienced home flipper tackles it.

You should fully understand precisely what the home will sell for once it’s fixed up, the expense of enhancing it, as well as the permits, contingencies in addition to your lowest profit so you may proceed to the next offer. The moment you have that worked out, only then may you recognize exactly what to offer the seller..

Capital for home flipping is available, however you may pay much more as an investor

Presently there are a great deal of loan providers available which focus in home flipping. The crucial factor to keep in mind is, you’ll be an investor, not necessarily a home buyer. As a consequence, your interest charges, even if you possess the finest credit rating, will certainly be many percentage points above even the greatest rates, at times towards double numbers. You furthermore may only be capable to finance merely 60% of the property, although many loan companies may finance as much as 130% of the purchase price in order to assure there are funds with regard to the renovating.

Get your team together

In order to be a profitable house flipper, you’ll require plenty of close friends, specifically friends who are building contractors, house inspectors, accountants as well as attorneys and real estate agents. It normally takes a crew to construct a home, and it requires a crew to flip a house. Simply because you have purchased a house, sold a house or even painted a house, does not suggest the expertise to flip a house is there.

You’ll require to operate with a reliable builder to be an effective flipper, as well as a qualified home inspector which can point out items which will need to be repaired that you’ll expect to talk down into the sale price, or it will cut into your gains once you sell. You will also need a competent Realtor which can price the residence appropriately when you depart.

Location is important

It doesn’t matter how great the offer you make on the purchase end of the home if the location isn’t a sensible one. Nonetheless, even a 10% to 20% revenue margin on a flipping offer is an effective one. There tend to be far better markets than others with regards to flipping.

You’re an investor, not a homeowner

With regards to the essentials of home flipping, it’s crucial to select a house which demands only cosmetic modifications, such as kitchen cabinetry or a fresh paint job, which may be completed comparatively swiftly as well as somewhat avoidable. Furthermore, if the house is a foreclosure, discover how long it’s been empty and if it has encountered considerable structural damage while vacant. It’s very probable the previous property owners removed everything worthwhile from the house prior to leaving, such as kitchen appliances, electrical wiring and possibly copper piping. Select a house that’s structurally sound and will not call for significant renovations such as a brand new roof or electrical and plumbing.

Also, whenever pricing the flip, it’s vital that you remain inside the conforming loan restrictions established by Fannie Mae and Freddie Mac throughout the market region. Or else you’re constraining your retail customers who won’t be approved for a massive mortgage or need to put 20% down.

In the event that you remain beneath the conforming loan limitations, you’re raising your buyer pool. If not, you are escalating the probability that the house will remain in the marketplace and you will need to carry the loan for a longer period of time.

Article Source: http://EzineArticles.com/9653739


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Buying a Real Estate Property That Will Generate Positive Cash Flow

Buying-a-Real-Estate-Property-That-Will-Generate-Positive-Cash-Flow

When looking at real estate properties as financial investments, you will have to decide whether an appreciated value or positive cash flow is your main goal for getting properties. There are some things you need to consider before you make that decision.

Since you would more than likely be looking at single family homes and multifamily homes, there is a difference between the two.

With the former, the value of the property usually increases in value quicker. However, since more expenses are attached, you may not be looking at the kind of positive cash flow that you want.

On the other hand, multifamily units (i.e., duplexes) can generate more positive cash flow. However, they may not appreciate quickly like single-family homes do. Also, not as many expenses are attached to the latter.

Since most real estate investors look to create wealth, they will choose having a positive cash flow. In this case, you will need a reliable real estate agent that is willing to help you find real estate properties that will produce the positive cash flow you want.

Look at the balance sheets and see what you will look forward to as far as repairs, maintenance, fees and other miscellaneous expenses.

In order to maintain a steady stream of positive cash flow, you need to have the right tenants, so take your time. There are some people who will spend lots of money on real estate courses that don’t teach much of anything.

They end up being back at square one. Find a good real estate agent that is willing to genuinely help you. Sometimes, you may be fortunate enough to find one that is also an investor on the side.

Calculating Your Cash Flow

As a real estate investor, you need to be able to calculate all of the cash flow that comes from your properties. You want to make sure that you are making a profit. You will also be able to make decisions on real estate investments that you may purchase in the future.

In order to calculate your cash flow, you will need to add up how much rent you will get from your tenants. If you have more than one unit, take into consideration any vacancies you may have. Depending on how your property looks, include a small percentage of the vacancy rate into the equation.

With the total rental amount, get a figure for your losses. You will have to include property expenses, mortgage loan interest and property depreciation.

Deduct the expenses from your total rental income in order to get your losses or savings for taxes. With that, you will either add or deduct that from your expected amount from your tenants. Take your operating expenses and monthly mortgage payment(s) and deduct them for a second time. The result will be your cash flow.

When you come up with a cash flow amount, you will be able to figure out how much you will charge for rent if you decide to purchase future real estate properties. It’s important that whatever money you make, that you don’t squander it. Put it away because eventually you will need it for other things relating to your investment properties.

Changing Negative Cash Flow To Positive Cash Flow

When you have negative cash flow, you are not making a profit. You are paying out more in expenses than you are taking in as profit. That’s not how you want to operate when you’re investing in real estate properties.

Here are some ways that you can chance the negative cash flow to a positive one:

  • Implement a rent increase. Only increase it to the amount of the current market. Don’t overdo it, other wise you may not have any tenants.
  • Make the tenants pay the utilities. This would relieve a burden from you. Besides, since they are living in your property, they will be using utilities every day.
  • Go over your property taxes to see if you can find anything that may have been missed before. Who knows-you may find out that you were charged more in taxes than you should have been charged.
  • Contact your insurance company and see about paying more for your deductible. Then make inquiries about getting a better deal for coverage on the property.
Article Source: http://EzineArticles.com/1984942

Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Real Estate Investing – Strategies to Become a Successful Investor and Create Wealth

Untitled-1

Real estate investing is one the pillars of wealth creation in the world today. The last time I looked at the Forbes list of 400 richest Americans, I could still count over 31 tycoons listed as billionaires.

In the same vein, you have individuals in your city and state who have made their fortune and hold their wealth in property investments.

Why you need to invest

In his essay “Theory of Human Motivation” first published in 1943, Abraham Maslow, father of behavioural psychology observed, that people are motivated to fulfill three basic needs. The three basic human needs are food, shelter and clothing. And many people will try to fulfill these three needs, before any other need.

When you invest in real estate, you add value to your customers in one of the important area of human needs-shelter. You are investing in an evergreen industry.This is why, I believe you should include property investing as part of your wealth-building portfolio.

However before you go out and buy your first property you need to have the right plan of action to succeed. The first thing you have to be aware of is that…

Goals are important.

Your need to know, what you want to accomplish:

  • Are you looking at wealth accumulation within a short time frame (3-7 years)?
  • Are you investing for the Long term (retirement)?
  • Do you want be a Full time investor and derive all your income from your real estate investment?

When you ask yourself these critical questions, you are able to focus and achieve your dreams.

You need to develop critical success traits.

It is important you develop or become aware of the traits, you need to win as a real estate investor. Five main traits are important for success:

  • Competency in your niche, this means you know about the basics, at the minimum and then become excellent in the niche you decide to invest.
  • Control over your emotions. This is important if you are going to stay in the investing arena for the long haul because there will always be difficulties in the real estate market. The difference between a novice and a professional is the ability to ride the eye of the tiger without getting into the belly of the tiger. Being a real estate investor takes guts and you need to have them if you want to become wealthy
  • Comprehension. This means know your market cold. You understand who your customers are, what they are looking for, why they want to deal with you. If you lack these key trait-insight into your market-you are doomed to fail.
  • Consistency. This means you have focus and discipline to, take action daily, weekly until you accomplish your goals.
  • Integrity. You stay true to your principles, because integrity is important in real estate. This means you are trustworthy, to your bankers, investors and tenants.

Strategy vs. tactics

The strategy (what to do) is more important than the tactics (how to do) of real estate investing. Let me explain.

If for instance, you wanted to gain wealth in a very short term then to buy and hold real estate, which is a long-term strategy-will not be the right strategy to achieve your goals. Flipping and wholesaling properties- buying undervalued properties and selling at a higher price to gain profit-may be the best strategy.

Knowing enough vs. Knowing it all

I think it’s important to have an understanding of real estate investing, however you don’t need to know all about real estate investing to start.

You need to one thing that I think is important for an investor… You need know enough about the basics-how to analyse properties, how to get financing, and how to assemble you real estate team together. That is it.

If you wanted to make a full time career as a real estate investor, then you would have to know more. You would have to specialize in a niche.

I am not going to spend many hours learning about short sales, wholesaling and foreclosing investing especially if I am not going be a full time investor. It would be counterproductive for me, when I should spend my time doing what I am best at doing.

Let’s recap, to succeed investing in real estate…

  • You need to understand why you are investing in real estate.
  • You need to develop critical traits for success as a real estate investor.
  • You need to choose the right tactics to match your investing objectives.
  • You need to know enough about what you want achieve

Article Source: http://EzineArticles.com/6054300


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

The Purpose of Investing in Real Estate Should Be to Create Passive Income

The-Purpose-of-Investing-in-Real-Estate-Should-Be-to-Create-Passive-Income

When investing in real estate there are many different avenues to choose from. When deciding which avenue is best for you, it’s important to consider the difference between passive-income generating avenues and earned or working-income generating avenues. In fact, in my opinion, understanding the difference between passive income and working income is one of the most important things to consider when investing in real estate.

Working Income vrs. Passive Income:

Working Income: Working Income is buying a house, fixing it, and then selling it for a profit. Or building a house then selling it for a profit. Or my favorite is buying a house, holding it (hoping it will appreciate in value, while losing money every month), then selling it.

Passive Income: The best way to understand passive income is to play Robert Kiyosaki’s board game, “Cash Flow 101.” To win (get out of the rat race), you have to get your monthly passive income to exceed your monthly expenses. It’s a real eye-opener. In his game, the quickest way to achieve this is purchasing cash flowing rental properties. Passive income is income that is earned without you doing the work to earn it. Rental income is a great avenue for passive income.

Here are a few reasons why investing in rental properties are an attractive avenue for investing in real estate:

Lower Taxes: Passive income is one of the lowest taxed forms of income, especially rental income. Uncle Sam likes that you’re providing affordable housing and is willing to cut you some slack on the taxes. When you buy, fix, and sell a property, that income is taxed as capital gains and you’re going to pay Uncle Sam 25-40%. Also, owning rental properties is a business, allowing you to write off operating expenses of your business.

Depreciation: This is a benefit often overlooked. Owning rental property provides a non-cash write off over the useful life of the property. Depreciation is defined as the loss in value of the property over time due to wear and tear, physical deterioration and age. Residential income property is depreciated over a 27.5 year period using straight line depreciation (or in other words, depreciated by equal amounts each year over its useful life). While your accountant will do the math, the point is, it’s a non-cash expense lowering you overall tax liability.

Time: Perhaps the best benefit of investing in turn-key rental properties is that it creates time. Remember, passive income creates time, working income takes time. The problem with working income, not only in real estate but in any business, is you have to keep working to make money. The whole reason why any of us get into real estate is for the life-style it can provide. To me, real estate is a means to and end. It doesn’t define who I am. But if done right, it provides time and money to be, do, and have everything I want in life. That’s what this is all about. While a measly $200/mo cash flow on a single family rental property doesn’t sound as sexy as flipping a house and making a quick $15,000, you have to look at the bigger picture.

For example; if you acquire 20 turn-key properties from Equity Services, LLC, each providing $200/mo cash flow, that would be $4,000/mo passive income. That money comes in while you’re eating, sleeping or surfing on the beach (we have a lot of Hawaiian investors)! Now there is some work you’ll have to do, unless you get someone else to do it. Someone has to walk to the mailbox to collect your checks! I get my kids to do it. (There’s more to it than that but you get the point). If 20 properties seems too hard to achieve, remember the old saying; “How do you eat an elephant? One bite at a time!” Well, how do you acquire 20 rental properties? One house at a time! We have one client, Mitch, who is buying his first rental property from Equity Services, LLC. His goal is 500 units in 3 years. Wow! He’s definitely caught the vision of passive income.

Equity Services, LLC = Turn Key

When we’re asked what it is we do, we often state that we sell “turn-key rental properties.” In fact, if you look at our company logo, you’ll see a house with a key. So what does turn-key mean? It means, we have a system in place to handle everything from acquiring the properties, to managing the renovations, to providing the tenants and everything in between. While there are many benefits to using Equity Services, LLC such as our houses are priced right, they have equity, etc., the real value we add is by saving you the time and energy to acquire solid cash-flowing properties. We have a strong relationship with the banks and purchase distressed properties at a discount. We renovate the properties to our high standards (we have rehabbed over 100 properties since 2007). The property manager handles filling the units and managing the tenants. As Timothy Ferriss states in his book, The 4 Hour Workweek, “Our goal isn’t to create a business that is as large as possible but rather a business that bothers us as little as possible.” We have developed a proven system that saves our investors their valuable time. Every now and then we run into the “do-it yourself” investors. We had one investor who gathered information from us, flew down to Michigan, and bought a house. He quickly found out that it wasn’t as easy as he thought, especially long distance. If anything, it helped him appreciate what we do.

Before you run out and quit your “working income” J.O.B., consider this; Keep your job but focus on building your passive-income empire. Use you earned income to invest in more passive income. Then as Robert Kiyosaki teaches in his book Rich Dad Poor Dad, once your passive income surpasses your expenses, you’re financially free. And remember, “profit is only profitable to the extent that you can use it. For that you need time.” (T. Ferriss, The 4 Hour Workweek)


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Always Bet on Safe Real Estate Investment Rather Than Quick Investment

Always Bet on Safe Real Estate Investment Rather Than Quick Investment

Financial planning and investment is all about finding out where to invest your money so that you can get the best possible returns. Real estate investment has always been considered as safe because seldom the demand for real estate witnesses a dip. Property investment is the safest and there are strong reasons as to why it is given priority than other forms of investments like mutual funds, bonds, stocks and ETF. You can literally grow your money through property investment with minimum risk.

Investors skittish of stock market investments prefer to invest in the real estate market but there are many who have not yet got over the 2008 downturn. Scars of those days have not yet healed for many and they are not ready to invest just for the sake of property investment. They need strong and logical reason behind this investment; they prefer to wait it out rather than put in all their money hastily.

If you take property investment decisions in haste, chances are high that you will end up with something in your portfolio that would fail to produce the desired ROI. In property investment, only four different routes prevail; however, here we are going to look at only two of the most popular ones.

First: You can go ahead and invest in a rental property

Second: You can buy shares in the REIT or real estate investment trust

Buying the rental property is quite straightforward method wherein you buy a rental property and give it out on rent. However, this type of investment is not for everyone as many fail to juggle their professional lives and at the same time upkeep a property like a landlord. It takes a lot of time and effort to maintain the property you buy unless you are using the services of a management company. You can obviously use the services of a management company but be ready to take a cut in your profits.

On the other hand if you invest in REIT, you don’t have to actually own a property on the ground and go into the landlord-mode. It operates just like a mutual fund and the only difference here is that it is property investment. The trust is a group of investors who make property investment and lets the individual investors buy its shares. The trusts are able to receive tax benefits as they pay a major chunk of their income to their shareholders. You can buy shares on public investments, which implies that your investment is quite liquid. You are ensured of regular dividends.

Two other methods of property investment that are often used by investors include notes and croudfunding portals.

Notes – You will be able to invest in second mortgages, paper notes etc. You can even sell or buy notes just like other real estate invest estates. The best thing is that there are no brokers involved in this.

Crowdfunding Portals – Many people with similar investment interests can come together to fund real estate investments. This is a new form of investments and is being tried out by some.


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com

Property Management and Rental Terms Glossary

Rental-Property-Management

Moderate Housing: This sort of lodging is that of which a government or state office oversees with an end goal to offer help and control the rent to the individuals who meet a specific foreordained criteria.

Luxuries: Intangible and unmistakable elements that are incorporated into or on a property that improve the allure or estimation of the property.

Flat: A multi-family assembling that is intended to house separate people or gatherings of families inside the same building.

Expedite: A land proficient that buys and offers property for others with a specific end goal to get a commission. This expert must be authorized and qualified to rehearse in the state he lives in.

Apartment suite/Condominium: A multi-unit fabricating that takes into consideration singular units to be claimed by its inhabitants. The normal components of this kind of building are possessed by all proprietors inside the townhouse.

Routine Housing: This kind of lodging sticks or complies with the business sector rate, or satisfactory benchmarks, of the territory’s lodging.

Co-Signer: An extra endorser on a lease or home loan that is utilized as a part of request to check the personality of the guideline proprietor or to give a specific level of surety to the moneylender or landowner.

Duplex (House): A house that was intended to house two separate people or families inside the same house. Case in point, a house that has an upstairs for one family and a down the stairs for another family is viewed as a duplex.

Square with Housing Opportunity: The open door for all subjects in America to have the capacity to live in different lodging groups paying little mind to race, sexual orientation, age, nationality, familial status or incapacity.

Morals/Professionalism: An arrangement of standards and good rule that become possibly the most important factor when directing proficient conduct.

Expulsion: A procedure through legitimate means with an end goal to expel a man from their home because of an infringement of the assertion, whether the occupant has not paid rent/contract or on the off chance that they have abused another type of the understanding, for example, commotion unsettling influences.

Reasonable Housing Act: This law is of a government status and was placed in actuality to stop the separation that happens in lodging in view of race, age, shading, handicap, sex, religion, national starting point and familial status.

Lodging Assistance Payments (HAP) Contracts (PDF): The HAP contract is utilized so that those under the voucher project can get area 8.

House: A living arrangement in which individuals live.

Lodging and Urban Development (HUD): The mission of HUD is to build the entrance to lodging that is moderate without separation; bolster the improvement of the group; and expand the homeownership rates.

Pay Levels: These are points of confinement as characterized by the administration that are utilized to set up expense credit limits and different sorts of moderate lodging.

Toxic Paint Disclosure: Requirements that got to be powerful starting 1996 to guarantee that families and people are made mindful of homes that contain toxic paint.

Lease: An oral or composed contract that is created between a landowner and his inhabitant that furnishes the occupant with the privilege of select ownership of the home for a particular measure of time. By and large talking, for leases that are longer than one year, the assertion must be in composing.

Lease Option: An assertion that permits the inhabitant the choice to buy the property they are renting toward the end of the lease term, or some time amid the term of the lease.

Lease Renewal: The restoration of a lease once the term of the lease has terminated.

Lease Term: The measure of time that is settled upon between the landowner and inhabitant in which the occupant will possess the property.

Tenant: The occupant who has concurred for the term of the lease.

Lessor: The proprietor who has concurred for the term of the lease.

Low Income Tax Credit (LITC) Properties (PDF): These sorts of properties give the proprietor a specific measure of expense credits in return for leasing to qualified occupants as assigned by the Justice office, HUD and the IRS.

Support: The upkeep and consideration of a property.

Persons With Disabilities Act: A demonstration that insurances rise to open door for those with inabilities.

Pre-Qualification – This is the main stage in the offering procedure where the most extreme advance sum for the candidate is resolved.

Property: A bit of land and additionally the perpetual apparatuses, for example, structures, that is joined.


Memphis Buy And Hold is specializing in locating, purchasing, renovating and managing single-family and multi-unit properties and possesses over 8 years of experience in real estate investing and property management in the Memphis and Nashville markets… Learn More…… www.memphisbuyandhold.com