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Archive for the ‘Buying Real Estate’ Category

The downside of 24/7 news coverage is that sometimes doomsday commentary is perceived to be more headline worthy than humdrum coverage of a slow but consistent economic recovery. While there is no argument that the United States’ housing market, whether it be resale homes in San Diego or new homes in Dallas, has struggled, the idea that home ownership is going the way of the dinosaurs, or that Americans suddenly don’t see buying a house as a good investment, is simply not backed up by any valid data.

While many prospective homeowners are waiting for the market to get stronger, or for bank lending practices to ease from their current Draconian practices, many economists say that now is the perfect time to buy a house. Part of the problem in the years leading up to the recession was that homeowners were pushed to buy more house than they needed; taking on so much debt left many households with no cushion and no safety net.

Now, the mantra is responsible homeownership, which is why new homes communities, such as those offered by LGI Homes, make sense for most buyers: they offer reasonable (or no!) down payments, affordable monthly payments, well-built homes with plenty of amenities, and a family-friendly community. The key is to get the most value for your money, not just the most square-footage you can find.

Increasingly, despite news stories to the contrary, real estate and investment experts are urging consumers interested in buying a home not to wait.

Mortgage broker Tim Burford, says, “There is no better time to buy a home, with mortgage rates at an all-time low and home affordability rates at an all-time high. Even in cities where it was traditionally cheaper to rent, home affordability has shifted to where it makes more financial sense to buy.”

Another factor to consider is that as more people put off buying homes and choose to rent, apartment demand is increasing, which in turn has caused rents to steadily increase in many states, effecting the sale of new homes in Texas, California, Arizona, Florida, and many other parts of the nation. Experts at the National Association of Realtors predict rents will increase between three and five percent by the end of 2013.

So rather than wait on the sidelines, now is the time to enjoy all the benefits—both financial and emotional—that homeownership entails.

With the British and American economies in quite a strong position many more Americans are considering putting some of their hard earned cash into buying a vacation home overseas and apparently one in three Britons has their sights set on buying a holiday home in the sun.

If you dream of owning a sunny villa in Italy, a cottage in Scotland or maybe a beachside apartment in the Caribbean, here are five essential tips to consider when looking for real estate overseas.

1)    Research Your Location

You may already have a favourite destination in mind and be visualising your life lazing by a swimming pool overlooking the Mediterranean Sea…on the other hand you may be interested in shopping around to find the best countries in which to buy a vacation home and make an investment into property.

It’s wise to do a fair amount of research into any new destination and cover everything from foreign ownership of real estate rules, property taxes, the political and economic stability of a destination and also the investment potential a given country offers.  With this information in hand it will be easier to make the right decision about which location suits your lifestyle objectives, budget and long term investment plans.

2)    Employ Assistance

Finding a realtor able to assist with your search for the perfect vacation home could save you time, effort and even money in the long run – although most realtors take commission from any sales they make of course!  But a local agent will understand the dynamics of their property market and be able to quickly and efficiently track down real estate bargains that match your vision for your vacation home overseas.

Be aware that in some countries real estate agents neither have to be licensed nor qualified however and so take a recommendation if at all possible and tread carefully.

3)    Manage your Money

If you need to raise a mortgage to pay for your vacation home you may need to re-mortgage your home or raise finance in your home country to fund the purchase because in many countries it is difficult for non-residents to get a mortgage and in some of the emerging property markets around the world there is no possibility to get a mortgage.

When transferring money overseas beware of fluctuating exchange rates that can devalue your lump sum significantly and make the difference between you affording your dream home and affording a poor second best.  There are professional companies available who can help those buying property abroad to deal with fluctuating currencies…look into your options.

4)    Title Deeds and Legalities

Legal systems vary from country to country as does the land registry system, and in some countries title deed transfers are not registered at all which can make it difficult to prove who owns property.  Make yourself aware of the legal rights that you will have as a property owner in a given country and find out about any assurances you can get that you own the freehold title to the vacation home that you have bought.

Never buy real estate overseas without the aid of a good lawyer, check their credentials and ensure that any contracts or agreements you sign are translated into your mother tongue and that you check the wording carefully before you sign!

5)    Protect Your Assets

Once you make the transition from house seeker to vacation home owner you will want to keep your real estate assets well looked after.  If you are only going to be vacationing in your home overseas occasionally consider having a management company look after your home when you are away.

Ensure a property that is to be left for periods of time is well secured because even in countries where there is very low crime a beautiful home left standing empty can become a temptation.

Get insurance to cover the value of your home and contents and make sure someone regularly checks that your property is in good order, that the weeds are not growing over your veranda and that your swimming pool is clean and ready for when you next take a holiday in the sun.

Finding a good apartment in New York can sometimes can be a real hassle.  This is especially so if you spend most of your time in a full time job with little or no time to walk around comparing prices and the suitability of the various New York apartments available.

Everyone in New York wants to rent an apartment that is spacious, affordable, nice looking, located in a nice neighborhood with good security and easy access to central business district not to mention to mention lots of friendly neighbors.  Unfortunately, we all know that such an apartment is not easy to find in New York.

A good apartment, whether you are buying, renting or leasing, should have a good payment mode.  How would it feel living in apartment where if you exceed a day without paying your weekly rent bill, you are automatically kicked out?   Not pleasant. The trick is to choose an apartment not just because of its beauty but an apartment whose payment mode you are comfortable with. The duration you intend to stay in town might help you know the kind of apartment you will choose., If you are in New York for only a short while, then you don’t have  to burn all your cash on rent. It’s advisable that you look for New York apartments in the cheaper neighborhoods where the cost is lower.

Buying a home can be one of the best feelings in the world. Nothing beats that feeling of security and satisfaction when you open the door to a new home and are happy with your purchase. The question is, how can you best ensure that feeling is going to happen? There are a lot of pitfalls in the real estate world and naturally you want to be able to avoid them and end up with a great home. Here are some great tips on how to streamline your home purchase and keep those little headaches from cropping up.

Enough cannot be said about being financially secure and aware. If you spend some time organizing your finances before making an offer the process becomes much less stressful. Take some time and research your credit history and find out if there are any outstanding issues or problems and get them taken care of. This can negatively affect your chances of getting a good mortgage, so it’s in your best interest to clear any credit issues up before the buying process starts. Most mortgage companies will offer you a pre-qualification, now this is nice to have but you are better off to take it a step further. Obtain a pre-approval for your mortgage. The pre-approval gives you an absolute number to work with. Not only does this make shopping for a home easier on you, but it gives you a significant amount of leverage in the actual sale.

The next logical step is to begin working with your realtor on finding homes that suit your needs. Let you realtor know what things you cannot do without and those things that you would like and let them come up with a list of fitting homes. During this time you can also research the available homes in your chosen area on the internet and find places that appeal to you. With this ammunition you and you agent should be able to view homes and properties with confidence and easily find a place that is agreeable to your needs, wants, and wallet.

Once you have located the perfect property, have an inspection done. This step cannot be stressed enough. Be wary of sellers who are willing to sell to others on the “no inspection” clause. This is never a good thing and much of the time they don’t want an inspection done for a reason. The inspection is extremely important step in ensuring your protection as the new owner. After all, this is going to be home right? Don’t ever sell yourself short.

We found cheap houses for sale all over the country. My wife Ana and I were on a seven-week drive around the country. It was a vacation, but we looked at houses too, and bought one in a great little town in the mountains of western Montana. It cost $17,500, and after $2000 to fix it up, we lived there for several months before selling it for $28,000.

We loved Anaconda. Where else can you fly fish, go to a three-dollar movie in a beautiful old art-deco theatre (the 5th most beautiful in the country, according to the Smithsonian), drop some nickles in a slot machine, eat at a fine restaurant, stop by the bar for a dollar beer, and buy a house for under $30,000 – all within a four block area! There are good schools and churches, a library with fast internet service, and wildlife (including bears) a few hundred yards from downtown.

Why Are There Cheap Houses For Sale?

There are cheap houses in Anaconda, and nearby Butte because there aren’t many good jobs. I easily found jobs in Anaconda – but not good ones. This explains why people left the area in the 80′s, after the mines and smelters closed.

Thirteen percent of the “housing units” in Anaconda are vacant, according to the 2000 U.S. census. This has driven down the home prices dramatically. Since it still has all the basic ammenities, is cleaner now, and is slowly recovering, it’s a great place to retire to or to move to if you have an internet or other non-location-based business.

A poor local economy is the reason you can buy cheap houses in many parts of the country. These are towns that have seen troubled times, but are often recovering, sometimes with good reasons. Anaconda, for example, now has, in addition to it’s beautiful mountain scenery, a ski resort and a Jack Nicholas golf course. Houses cost four times as much an hour in any direction, and those prices are bound to reach Anaconda eventually.

Cheap Houses You Don’t Want To Buy

There are towns like the one in South Dakota where we stopped for lunch one day. A bulletin board had ads for cheap houses for sale by desperate people trying not to be the last to leave town. There was a photo of a beautiful old five-bedroom farmhouse for $11,000. As we ate, we looked up the deserted street and noticed that most of the buildings were boarded-up. This was a dying town, with nothing to help revive it. A free house wouldn’t be a good enough reason to move here.

Cheap House For Sale – Our Criteria

There are many wonderful towns, from Florida to Oregon, where there are cheap houses for sale. After our Montana experience, we started a website about them. What does a town need in order to make our list? The criteria are certainly subjective, but include at least the following:

1. Population of 4,000 to 80,000.
2. Decent library.
3. Good grocery store.
4. Movie theatre.
5. At least six houses for sale under $50,000.
6. The town has a good “feel” to it.

After much research, we found a number of towns that met our criteria, including some with homes for under $30,000. There really are nice towns out there where you can find cheap houses for sale.

How do you find cheap homes? There are too many ways to list here, but there are five basic principles to learn. Understand these, and you can save thousands of dollars on your next home.

Cheap Homes Are In Cheap Towns

Yes, there are still beautiful towns in this country where you can see a good movie, put the kids in a good school, go shopping, enjoy nearby natural beauty, and buy homes for under fifty thousand dollars. My wife and I bought a beautiful little home with hardwood floors, a full carpeted basement, and a garage, in a pretty mountain town, for $17,500, in 2002. You can still get homes for under $35,000 there.

What you can’t get very easily there, is a good job. These towns with the cheapest homes usually have a bad job situation. They are great places to retire to, or to move to if you have a business or profession that isn’t location-dependent. Writers and internet entrepreneurs are beginning to discover them. Of course, if you’ve already determined where you’ll be living, or need a town with high-paying jobs, you can skip this idea.

Some Homes Are Just Cheaper

Another way to save when buying a home is to find a less expensive alternative that still fits your needs. This can mean buying in the inexpensive parts of town, or buying the inexpensive types of homes. Don’t set your mind on one type of home or one neighborhood before you know what all the alternatives are.

This doesn’t mean buying a cheap dump to save money, or buying in a dangerous part of town. It is more about a philosophy of defining your true needs so you can find the least expensive way to meet them. You may be surprised at what is available for less.

You Can Offer Less

No matter what you buy, you can save a lot if you know a few basic negotiating techniques. Is it worth a few minutes reading and an hour or two of practice to save thousands of dollars? Anyone can learn a few simple negotiating techniques that are used by the masters of negotiation. Somewhere, every day, people get cheap homes come through good negotiating.

Financing Can Make Homes Cheaper

You can pay the full asking price on a home and still spend thousands less than another person might. It isn’t just price, but financing too that makes a home affordable. Pay a lower interest rate, and you can save many thousands of dollars. You can pay low or no loan fees, avoid mortgage insurance, save on appraisals, and more.

Save Money On Everything Else

Start learning the insider secrets to saving money at each step in the home buying process. You can learn tricks like how to use a walk-through inspection list to present with your low offer. You can learn ways to get cheaper inspections, pay lower taxes, pay less for homeowners insurance, and save on closing costs. I even financed a home without an appraisal once. There is more to buying cheap homes than just getting a low price.

Is island life for you? Or is having an island getaway for you? Both questions would entail completely different lists of pros and cons. For investment purposes, island homes tend to hold their value, as land is obviously at a premium on an island!

The population of USA has access to many islands, in the Atlantic, the Caribbean, the US Virgin Islands and in the Pacific. If you are planning to buy a second home on an island, you will not need to do the same soul-searching that would be required for a permanent move.

Many families have bought an island cabin as a group purchase, and the weekends and vacations are allotted on a casual ‘time share’ basis within the family. It is shared in turn for weekend getaways where the children can roam free on weekends and vacations and every now and again they will all plan to show up together! It is a great idea for promoting family unity. It also keeps costs down, as boats, fishing rods, repairs etc can be shared.

However, that is a little different to suddenly deciding to sell everything up and move to an island. To some, that would sound idyllic and to others it may bring on claustrophobia!!

The advantages and pitfalls must differ according to each island’s amenities, climate, environment and many other factors, but are there any general island ‘rules’?

Most island residents who choose permanency would probably opt for an island with a ferry service. There are times when the sea is too rough for a little row boat, or motor boat, and they do not want to feel isolated. Of course, for many people this isolation is exactly what they DO want!

Sometimes a ferry schedule can mean that when you arrive home late (from a vacation flight) or from the theater you cannot make it home on the ferry. Many islands have a water taxi service that you can pre-book, or some residents will just use their own boat, and others will decide ahead to spend a night in the town’s hotel.

One other problem with living on an island is that often you may have to worry where to park your car. Is the island big enough to have a car ferry, or do you need to leave your car each time you go over on a tiny ferry? In the latter case, you will need to negotiate parking near the ferry – although this is often provided for.

Such other inconveniences, like arriving home with no sugar, is really just an accepted part of island life, and easily adjusted to. That’s what neighbors are for, and community glue is strong on islands!

No matter what the inconveniences are, to islanders, the peace and the feeling of being ‘away from it all’ is paramount. If you work off island, it only takes a few short weeks for that feeling of peace to pervade your entire being. It happens the minute you step onto that ferry boat each evening to cross the ocean to your island home.

Perhaps this poem by J. Earnhart and reproduced in the magazine “Island Life”, sums it up best

:If ever you’ve lived on an island
if ever you’ve lived by the sea;
You’ll never return to the mainland
once your spirit has been set free.

If ever you’ve smelled the ocean
or tasted the salt in the air;
You’ll know you’ve discovered a haven
that is uncommon, precious and rare.

If ever you’ve seen the whales play
or watched the eagles in flight;
You’ll remember, again, why you live here
and why it feels so right.

If ever you’ve seen the sunset
as the ferry passed the shore;
You’ve seen the beauty of the island
that will be with you forever more.

If ever you’ve heard the seagulls
the waves, a foghorn, the winds;
Then you’ve heard the song of the island
and the peaceful message it sends.

Indeed, if you live on an island
if you’re lucky to live by the sea;
You’ll never return to the mainland
as your spirit has been set free.

Investment may be counted on the gross or the net basis. Net investment is gross investment minus depreciation. Investment may be ex-ante or planned or anticipated or intended investment; or it may be ex-post, i.e., actually realized investment, or when investment is not merely planned or intended, but which has actually been invested or implemented. This is so true when Buying Investment Properties.

Another classification of investment may be private investment or public investment. Private investment is on private account, i.e., by private individuals, and public investment is by the government. Private investment is influenced by marginal efficiency of capital i.e., profit expectations and the rate of interest. It is profit-elastic. Public investment is by the state or local authorities, such as building of roads, public parks etc. In public investment, profit motive does not enter into consideration. It is undertaken for social good and not for private gain.

Investment which is independent of the level of income, is called autonomous investment. Such investment does not vary with the level of income. In other words, it is income-inelastic. Autonomous investment depends more on population growth and technical progress than on anything else. The influence of change in income is not altogether ruled out, because higher income would probably result in more investment. But the influence of income is negligible as compared with the influence of population growth and progress of technical knowledge.

Examples of autonomous investment are long-range investments in houses, roads, public buildings and other forms of public investment. Most of the investment is undertaken to promote planned economic development. It also includes long-range investment to bring about technical progress or innovations. Public investment means investment which occurs in direct response to invention, and much of the long-range investment, which is only expected to pay for itself over a long period, can be regarded as autonomous investments.

You need to be very careful before committing to the purchase of a house. If the house has wood and brick on the exterior, you need to consider the following issues.

Wood Issues

Wood is a beautiful material, particularly when it is used on the exterior of a home. Compared to stucco and other materials, it is a wonder wood isn’t used more often. The reason, of course, is wood simply doesn’t hold up as well as man made materials. If you are looking at a home with a heavy emphasis on exterior wood siding, trim and so on, here are some things to watch out for when evaluating the opportunity.

1. The first thing to realize is the appearance of wood has almost no relevance to the  condition. A perfectly good looking piece of wood trim may be infested with termites or rotting and you will never know by just glancing at it. When inspecting wood exteriors, never trust your eyes.

2. One of the biggest issues with wood is degradation. When looking at particular areas, make absolutely sure you physically touch the wood. In fact, you are probably best off giving it a fairly good poke with a finger. In doing so, you should be looking for soft areas. Soft areas are indicative of rot in one form or another. Finding rot in one area should make you very concerned about finding rot throughout the structure. Put another way, you may want to start looking at other homes on your list.

3. Finding soft spots in wood can be troubling, but there is something worse. If you poke or squeeze a piece of wood and dust or bits fall off, run for the care. This type of degradation is often a sign of termite problems. Termite problems should be a huge red flag for any prospective home. If you buy the house, you are going to have to tent it to kill the bugs and pay to inspect and repair the damage done by the evil little bugs. In short, you are buying a minor, but expensive, nightmare.

Make no mistake, wood can be very attractive on the exterior of a home. Just make sure you don’t rely solely on a visual inspection of it when deciding on the merits of the house.

The most expensive thing most people will buy in their lifetime is the house in which they live.  In addition to being expensive and taking decades to pay for, the purchase of a house also represents one of the more complicated legal transactions most people will ever encounter.  Despite the need for contracts involving bankers, city, state and county tax assessors and other legal entities involved in the sale of land, most people never even consider hiring an attorney to assist them with the purchase of a home.  That’s unfortunate, as the relatively small amount of money saved by hiring an attorney now could possibly save thousands of dollars later.

How can an attorney save you money?  By double-checking all of the terms and documents of the transaction to make sure everything is legal and proper.  Most people who buy homes don’t bother to check zoning ordinances or whether or not the home or fence on their property encroaches on that of a neighbor.  An attorney can check these things along with tax issues and any one of a number of minor things that most buyers never even know to think about.

Right now in Texas, a number of homeowners who lost their homes to foreclosure are engaged in lawsuits against the company that sold them their houses.  Among the allegations in the case are suggestions that the company that sold the property did such things as:

Tell buyers with bad credit and even previous bankruptcies that they qualified for unusually large home loans.  Some of these loans had monthly payments that exceeded 50% of the buyers’ monthly income.  In short, they agreed to lend buyers money that they knew the buyers could not afford to repay.

Provide buyers with mortgage documents that stated that the property wasn’t being resold but was rather being refinanced by existing owners.

Offer loan documents that contained a number of blanks which the sellers filled in sometime after closing.  Buyers were later shocked to discover that their monthly mortgage payments were much higher than they had been promised.

Showed the buyers fraudulent appraisals that suggested that the property in question was worth 2-3 times its actual value.

A lawyer would have caught any one of these problems, had even one of the displaced homeowners bothered to hire one ahead of time.  And yet hundreds of buyers appear to have been victims of mortgage fraud because they weren’t willing to spend a few hundred dollars to have an attorney look over the documents before they signed them.

Buying a house is agreeing to an obligation that can tie up your finances for decades.  It only seems reasonable that if you are going to spend hundreds of thousands of dollars on a place to live, you might want to consider spending hundreds of dollars to make sure that the terms of your purchase are legal and reasonable.  A little money spent now could save you a lot of money later.