In 2020, I knocked on the door of a homeowner. I told him we loved his neighborhood and wanted to buy a home there. Did he know anyone thinking of selling?

As it turned out, he was about to put his home up for sale because he and his wife could no longer afford to pay their property taxes. Though their house would be paid off in a couple of years, due to being on fixed incomes, they were being forced to sell even though they loved their house and didn’t want to move.

Here’s how a Pure Option fixed this homeowner’s real estate problem. 

The homeowner said his home was worth $175,000. I agreed to pay his yearly property taxes. In exchange, he gave me the right to buy his home in the next twenty years for $175,000. Also, for each $1.00 we paid in property taxes, the purchase price would be reduced by $1.50. We also agreed to not exercise our Option to buy the property for the first 10 years of the 20-year option unless he moved from the home. 

This was a win-win deal. The homeowner was not forced to sell and move. We would capture all the appreciation gain on the property for the next twenty years. 

How often have you met with a homeowner who DOESN’T want to sell, but until now, you’ve been unable to help that person solve their real estate problem? 

Have you ever run into a homeowner with a situation like this? Pure Options are one of the least understood and least used deal structuring tools in real estate.  ... Read More…

 

Here's a good one that just came to mind while working with a new person in the game: Volunteering 

Volunteering is how I got started on the road to success.  

A very seasoned member of my local REIA gave me that advice when I asked him what I could do to become successful in real estate investing. He said to volunteer. And I did. 

When you volunteer, you will find it useful to have your information handy on a card to give out. If you haven't already, make sure to get yourself some basic business cards that have your contact info on them: name, email, phone number, and (maybe) address. 

I know people talk about doing things digitally but there is still an excellent case to be made for a business card. I'm pretty sure no one ever scrolls through their contacts on their phone looking at who they have not talked to lately. But they *will* take a look through a pile of business cards now and then. 

What if they come across yours, they realize they have a good profit motive to reach out to you, and then you are right there to capture the money. Won't you be glad you gave out a business card to them when you volunteered?

&ck=09ae8196-2c44-45f2-97a8-524764065b2b ... Read More…

 

Here's a good one that just came to mind while working with a new person in the game: Volunteering 

Volunteering is how I got started on the road to success.  

A very seasoned member of my local REIA gave me that advice when I asked him what I could do to become successful in real estate investing. He said to volunteer. And I did. 

When you volunteer, you will find it useful to have your information handy on a card to give out. If you haven't already, make sure to get yourself some basic business cards that have your contact info on them: name, email, phone number, and (maybe) address. 

I know people talk about doing things digitally but there is still an excellent case to be made for a business card. I'm pretty sure no one ever scrolls through their contacts in their phone looking at who they have not talked to lately. But they *will* take a look through a pile of business cards now and then. 

What if they come across yours, they realize they have a good profit motive to reach out to you, and then you are right there to capture the money. Won't you be glad you gave out a business card to them when you volunteered?

&ck=0e1f16df-1530-4ee0-97cb-c2cd3feb46d8 ... Read More…

“There is no victory at bargain basement prices.” – Dwight Eisenhower

Prices are on the rise everywhere right now. What about yours? 

From just a few pennies to outright sticker shock, hiking prices is one of the quickest paths to losing customers. But you’ve got ends to make meet, too. 

Our inflation series continues with one of the most pressing problems for businesses today: How much you need to increase your pricing models – and what to think about before you do. 

Worry and response

Current inflation is 8.6% year over year, a seemingly endless upward direction that worries most businesses. Almost nine out of 10 have told surveys that they’re also already seeing the hit in higher expenses such as supplies and services, some by as much as 50%. Throw in employees probably wanting above-average raises and you’ve got a compound problem. 

Businesses’ response? Not hard to guess: Almost nine out of 10 small businesses in one survey said they had to hike their own prices – and that’s on top of the hefty percentage that'd already raised their prices since the pandemic started. 

The key question is, raised prices by how much? 

Almost half of businesses had to increase prices by more than 20%; almost half said they kept the increase to no more than 15%. Some companies that haven’t increased prices in years have had to pass along furious new costs to potentially furious old custo ... Read More…

 

The other day I was talking to a good friend of mine about the changing market and what strategies he found worked best. 

We were sharing the various tweaks we had made to our own marketing plans and how successful they were or were not. It’s a conversation we often have.

But what struck me this time, and I am not sure why it hasn’t struck me before, was that the one strategy we always put in the success column is Follow Up. Consistently following up with a lead always works!

 

If One is Good, More is Better

I have always been a person who thinks in terms of if one is good, more must be better.

I figure that if I send one letter, 10 would be better.  If I make 1 phone call, 6 would be better. If I sent 1 email, 100 would be better! Okay, that may be pushing it, but you get the gist. Sending just one piece of marketing is good but more is better! I think that is why the idea of Follow Up has been something I have always used.

When I explain this strategies benefits to my coaching students, I always use the example of shopping in a store at the mall.  If you are like me, you walk into the store with a single purpose…to get the item you are looking for as quickly as possible and get the heck out of there! But if you are also like me, the store is a foreign place where you have no idea where the one thing you need is located.

So inevitably you walk around the store searching.  Eventually, a friendly employee walks up and ... Read More…

 

Do you remember 1969? Probably not. But I remember the year 1969 very well. It was the year in which I purchased my first rental house. I was still in college and realized that I needed to break the cycle of poverty in my family.  

First, I decided to get more education than anyone else in my family. So, I went to college and majored in business. While studying in college, I realized that most people in America who became wealthy did it through investment in real estate. My initial interest was in apartment buildings, but since they took large amounts of down payment money (the “nothing down” concept had not been invented yet) I defaulted to the single-family home as my IDEAL investment vehicle. 

By the time I graduated from college I had acquired three rental houses and one small office building. After graduation, I continued acquiring rental houses and titling them in my name personally. One sunny morning I woke up and realized the potential risk I was creating by owning all these properties in my own name. These were the days before you could access the county recorder’s office online. But you could go down to the courthouse and walk into the recorder’s office to look up each owner of every property in town. Wow, was I stupid! 

I began to research different ways of holding a title to real estate. When I discovered the Land Trust it was intriguing but VERY difficult to find any information (especially accurate  ... Read More…

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Investing in real estate can be a profitable way to grow your wealth, but it isn’t without its challenges. The guide below from South Jersey Real Estate Investors Association will answer your questions about investing in real estate as a beginner.

The Perfect Investment Property
Investing in real estate can be a great way to earn passive income; however, not all properties are created equal. Ideally, you’ll want to look for properties that generate positive cash flow — so you can cover your mortgage payments with your rental income alone.

Financing Your Investment Property
Once you’ve chosen a rental property and made sure it’s a good investment, you'll need to think about how you’re going to pay for it. There are various ways to finance your investment property, including buying with cash, using all or part of your existing home as collateral, or taking out a loan from a bank or mortgage company. If you’re planning on taking out a mortgage, be sure to review PennyMac loans and rates to get an idea of how much you can afford to spend.

Finding Help With Managing or Renting
One of your biggest tasks as a landlord is overseeing your property and addressing any issues that come up — whether it's handling maintenance, dealing with tenant questions, or deciding when to raise rents. Unless you’re planning on managing your investment property your ... Read More…

 

The type of policy available to property owners varies based on the type of building, the building occupancy type, and the frequency of the building being occupied.

There are six categories for insuring investment properties, but we will look at only DF1 and DF3.  

The DF1 policy is a base policy with limited coverage for the building.  It can be used for vacant (rehab/flip), rental or owner-occupied properties, but the coverages are generally very limited, usually to:

1. Fire and lightning
2. Explosion
3. Windstorm
4. Hail
5. Riots
6. Smoke damage
    

The risk to any insurance policy is the exclusions. This list is usually rather lengthy and is “required” reading.  It explains in detail the various conditions for which the policies offer no coverage,  Some of the common EXCLUSIONS include:   

1. Flood and water damage
2. Frozen pipes
3. Roof damage due to sleet or snow
4. Falling tree damage
5. Ordnance or law and government action
6. Earth movement
7. Power failure
8. Neglect
9. War
10. Nuclear hazards
11. Intentional loss
12. Mold

 

Some policies may allow you to “purchase” these coverages, for a fee.   

Generally, a DF1 policy has coverage as actual cash value. In the event of a claim, this means the reconstruction value is calculated and then depreciated for age and condition.   

If your goal is to recover what you’ve invested, this may be a reasonable option.  If the go ... Read More…

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A Guide to Moving and Starting a Business

Moving into your new home and starting your own business can be very stressful, but there are ways to make the transition easier for you and everyone around you. Whether you’re moving across town or across the country, it’s crucial to get all the logistics of your move taken care of before you start a business in your new home office. Here are some helpful tips to make this transition as smooth as possible.

South Jersey Real Estate Investors Association offers real estate professionals and investors webinars and events to build their knowledge. Become a member!

Launching a Home-Based Business

If you're setting up shop at home, start with some basic tasks. If you have children in your home who are old enough to understand, explain that they should avoid bothering you as you're working. And if there's an area where you'll be working, consider soundproofing it so that other family members aren't disturbed by the noise coming from your office. Remember: You'll be living and working in this space, so take steps to make it ideal for both purposes.

Home Buying Considerations

When you’re buying a home that will also be your place of work, it’s important to consider how much space you need and whether any special features will make doing business easier. If you don’t know what features to look for, start by checking out other people's home offices. 

• Are they crammed with b ... Read More…

          It seems like every new Wholesale School student immediately stumbles upon a landlord who wants to sell ALL of his properties, then wants to know how to tackle a package of 4, or 9, or 37 single family homes all at once. And they're already rented, and the don't need any work, and the new wholesaler is excited because this looks like a deal that could make tens of thousands of dollars all in one fell swoop.

          These deals are problematic for a number of reasons:

1. I rarely see one where the landlord isn't asking more-than-market for the properties. He's willing to sell, but isn't really anxious to sell
2. It's basically never the case that the houses don't need work. Yes, I KNOW there's someone living in them. That doesn't mean that the roofs aren't 22 years old, or that the furnaces work consistently, or that they won't need a $5,000 turnover when that tenant inevitably moves out.
3. Each property has to be evaluated separately, which is a LOT of evaluation for a deal that's unlikely to come together.
4. Coordinating a single buyer to buy a whole package of non-turnkey properties, especially if they're in different parts of the city, isn't easy. Coordinating 9 buyers to close 9 properties on the same day is even harder.

          If you find one of these deals, here's how I suggest approaching it:

• First, get a list of addresses, rents, and major repairs/upgrades neede ... Read More…