Help Managing My Properties

These days, you hear a lot of discussion about whether this is a good time to buy property or not. There is speculation that we have hit bottom, that we haven’t hit bottom, that prices are starting to go back up, that prices won’t go back up for years, and so on.

What does a person have to do to make a decision about buying with all this confusion? It still boils down to one thing–the numbers.

The question of whether this is a good time to buy or not depends on who is doing the buying and what their goals are. If someone plans on living in the house for at least the next 3-5 years or longer, which most people do when they buy a residence, then this could be a great time to buy. Interest rates and prices are lower than they’ve been in years. The payments won’t change unless they get a variable rate loan.

If someone has the cash to put 20% down (and the cash isn’t borrowed), their credit score is high enough to get them a mortgage with a low interest rate, and their payments are well within their means to pay them, this is probably an excellent time to buy. Even if the value goes down for a while before it comes back up, which according to history it will, they should be OK.

Even real estate investors can insulate themselves from the effect of the values going down by including in their calculations as many worst case scenarios as they can think of or learn from other investors. If the numbers still work even for the worst case because they are able to get the property for such a low price, and the calculations are done using very conservative numbers, the investor should be OK.

Yes, things can happen unexpectedly, but that’s true no matter what the market is like. It’s all about the numbers and doing very thorough research, not guesses as to what the economy is or isn’t going to do.

While taking care of some business at my bank the other day, the woman helping me looked at my records to see if there was any way she could get more money for the bank (OK, maybe it was to provide good customer service…). Well, she ended up saving me over $150/month on my home equity line of credit (HELOC) payments!

Many real estate investors who have equity in their rental houses get variable rate equity lines to make their monthly payments lower and thus have a higher cash flow. There are different types of HELOCs, each with their own features.

If you have a variable rate HELOC or other type of home equity loan, you should find out, if you don’t know already, whether you designated a certain amount of money to be borrowed at a fixed rate. If you did, and it was back when interest rates were higher, you should call your bank as soon as you can to find out whether you can lower your interest rate.

I took my home equity loan out in April 2007. The prime interest rate on which mortgage rates are based had been going up for several months. I fixed the rate on almost the entire amount I borrowed to avoid higher interest rates.

The prime interest rate went up for another four months and then started going down again. It is not my practice to check the rates so I was completely unaware that I was paying too much interest until I went into my bank the other day.

To learn more about how you can streamline your real estate investing activities and maximize your profits, go to MyPropFolio, the web-based real estate investing system designed by real estate investors for real estate investors. It is definitely the Next Generation of Real Estate Investing Software.

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Buying property as a real estate investor can seem quite complicated when you first start out. And it’s true–there is no end to the details you can learn.

As you become more experienced, it is not uncommon to discover something that you never heard about, even after years of investing. This happens partly because of changing tax laws, but also because it is impossible to learn everything there is to know about any topic.

Recently, I became aware of something that few real estate investors know about—chattel. The definition of chattel is: all items in a house that are not part of the structure of the house such as cabinets, appliances, flooring, light fixtures, landscaping and many other items.

So, why should you care about chattel? Well, it can be depreciated faster than the house is depreciated and you can deduct it from your taxes over 5, 15, or 27.5 years. This can lead to substantial tax savings and can even turn a property with negative cash flow into one with a positive cash flow.

Now, you might be thinking, “Oh no, not another complex detail to keep track of…!” or, “How do I figure out what my chattel is worth?”

It is important to know what chattel you have but you don’t have to calculate it or track it yourself. To determine what your chattel is worth, you can have someone come in and do a chattel appraisal. This costs about the same as a home inspection.

To track changes and additions or removal of chattel, you can use MyPropFolio, the web-based real estate investing software designed by real estate investors for real estate investors. It is definitely the Next Generation of Real Estate Investing Software.

In the current real estate market, real estate investors cannot be successful using the same methods for doing business as they did in the past. The response to this market has been for them to either retreat away from real estate or to jump into it with new gusto.

The actions real estate investors take depend on whether they:

• see the opportunity,
• feel confident that this is a good time to buy the available low-priced properties
• know that they can handle buying multiple properties at the same time.

So, what makes some real estate investors feel confident and others feel that buying multiple properties is more than they can handle? There are several reasons for this:

Experience

Generally speaking, if a person has experience buying and selling real estate, that person is going to feel more comfortable with the process than someone who may see the opportunity but does not know how to take advantage of it.

Positive outlook

A positive outlook comes from a number of different factors:

• Good experiences – People who have had good experiences with real estate are likely to have a more positive outlook no matter how bad the market appears at any particular time.
• Skeptacism – Many people hear the doom and gloom expressed by the media and are frightened by it but others know that there are cities, or even neighborhoods, that have their own market trends and can be appreciating while most of the nation is depreciating.
• Confidence – Some people believe that there is opportunity in every market, bad or good.

Ability to streamline their activities

Some people are able to take short cuts, use templates, combine activities, and so on to streamline their businesses. They understand that if they don’t do this, they are not profitable.

Solid systems in place

Once real estate investors streamline their businesses, it becomes very easy to create solid systems to run the business with a lot less effort and a lot more successful results.

The purpose of this blog is to help real estate investors streamline their real estate activities and create powerful systems so they can run their investment business from anywhere in the world.