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PROFITING IN REAL STATE INVESTING

2007-07-10T03:19:00.000-07:00

KEY VARIABLES

The most important single factor in determining whether you invest
in any city or in any part of the city is the number of productive jobs
in that area,and the wage levels for those jobs. People pay for homes in
direct proportion to how close they are to where they work. People usually
buy the very most house that they can qualify for in terms of mortgage
payments,and they it close as they can to where they work, shop, and go to
school. These also goes when job increases,or wage level increase or
interest rates go down, housing prices and demand for housing goes up.

THINGS TO REMEMBER WHEN INVESTING

There are several important things you must remember when thinking
about buying a house anywhere:

1. UNIQUENESS

Each property is unique. It is unlike any other. It is unmovable.
It cannot be duplicate.It occupies a particular spot on the earth's
surface.The three key factors in purchasing real state have always
been--- LOCATION, LOCATION, LOCATION.
2. EMOTIONS

Many owners have a sentimental attachment to their properties,and
their ideas of the property's value are distorted by their emotions.
Homes are very emotional posessions and you must have aware of this.

3. AVAILABLE BUYERS

Buyers for a home are restricted to people living in or near the
community, or to people wanting to move into that particular area.
In other words, the number of buyers for any particular house are
limited considerably.

4. PRICES AND TERMS

Sales prices of homes are affected by the terms and the availability
of financing.Many home building companies realized many years ago
that they don't sell houses. They sell terms. They sell payments.
The size of the down payment and the availability of financing are
the critical factors in the purchase and sell of most new houses.

People usually purchase the most expensive house they can buy, based
on their ability to qualify for a mortgage. Lower interest rates
leads to lower payments,which leads to faster sales. High interest
rates leads to higher payments which leads to slower sales. People
can only get mortgage with payments that do not exceed 30% to 33%
of their incomes.As interest rates go down, people buy bigger homes.
As interest rates go up,people are force to purchase smaller homes
at lower price.

5. ZONING LAWS

The value of a particular property is often strongly affected by
the zoning laws that apply to it. Some communities have generous
and reasonable zoning laws and other communities do not.
Unfortunately,some officials in the city planning do not enforce
restrictions.But, if we had to comply,it could have been extremely
expensive. It would have made us were unhappy with our purchase
of that house. When we sold the house, the new buyer was able to
negotiate the price down several thousand of pesos, because of this
failure to comply with the zoning codes.It seems like small thing,
but it can be a large thing.

6. THE CHARACTER OF THE NEIGHBORHOOD

The key factor in purchasing real state is that the value of any
specific property is effected by the character of the neighborhood,
and the economic outlook of that neighborhood.Before you make a
home purchase,drive all around the neighborhood in all directions.
What is the character of the neighborhood? Is it neat? Is it clean?
Is it orderly? Is it dirty? Do your--"due diligence" and familiarize
yourself thoroughly with the sourounding area.

7. ALL HOMES ARE DIFFERENT

When buying a home or property,remember that all buildings are
different. They may have hidden defects or exceptionally favorable
features. We say -- "Judge by not appearance alone" and when you
are looking at homes, you should follow that advice. Appearance
can be deceiving. It is important that you look at the construction
of the building, and that you study it carefully.
If you are not careful, you can be sold a home that has cracked
foundation.Sometimes the home will be eaten by termites,or some form
of rot,and just painted over.

8. EVERY PROPERTY IS DIFFERENT

Just remember that every property is different.Each property has to
be inspected and approach differently. In every neighborhood,
there may be periods of rapid turnovers and periods of stagnation
and decline. There may be booms and busts. But stable home prices
overtime are always the best. You always want to invest in an area
where prices are stable and increasing overtime.

9. POLICE AND FIRE PROTECTION

Property values may be affected by the quality of police and fire
protection in the area. Areas with low crime rates are more
attractive than areas with high crime rates. Check into the
availability of police and fire protection. Find out what the
crime rates are in that area. Many people sell to get out of an
area because of crime rates. Many people pay more to get into an
area because of low crime rates.

10. AVAILABILITY AND COST OF UTILITIES

Property values are also affected by the availability and costs
of water, sewer, gas, and electricity. These can make or break
a real state purchase.

11. AIR, WATER, AND NOISE POLLUTION

One final point with regard to purchasing real state is that air,
water, and noise pollution may have a highly adverse affect on
real state value. For example, being close to a freeway, or close
to a heavily traveled roadway, may generate an enormous amount
of noise. This detracts from the value of the home and make it
extremely difficult to sell.

If the factors and information here are sound a little complicated,
remember that the only thing easy about money is losing it. Making
money in any thing, including real state, is hard work.
Making money requires careful preparation combined with eternal
vigilance. The one who knows the most about what they are doing is the
one who is most likely to be SUCCESSFUL.

REAL STATE is ART as well as SCIENCE. There are hundreds of millions,
billions, and even trillions of pesos tied up in real state of all kinds.
Many people have become wealthy as a result of real state ownership.
So can you. But you must learn how.Profiting in real state could be easy.

THE RULE IS: " YOU MAKE PROFIT WHEN YOU BUY REAL STATE, NOT WHEN YOU SELL"
Please click the link below

The Oriental Place

by Bryantracy.com

elertgadget.com

The grand Midori Makati

2007-07-08T20:43:00.000-07:00

SECRETS OF MAKING MONEY IN REAL STATE

The value of any piece of property is determined by the income that can
be generated by that property when it is developed to its highest and best
use from this moment in time, and onward into the future.
There are million of acres of land that will never have any real value, that
cannot be developed to produce income, to satisfy specific human needs or to
earn any money.

If you sincerely desire to enter the real state field, to purchase property
as an owner or investor, there are several things that you will need to learn
to make money in real state. Each factors is essential, and your knowledge of
these factors will give you an edge that will enable you to make wiser real
state investment decision.

4 FACTORS FOR INTELLIGENT INVESTING

FACTOR 1:
You must study the economics of the city and the neighborhood where
you are thinking of investing. Look at the neighborhood as though it
were a company, and look at a house in that neighborhood as though it
were a share of stocks in that company.
Some cities and some neighborhood are in a state of decline. These are
risky choices for real state speculations.These are the primarily the
places where you can get homes with no down. What you are looking for
is cities and neighborhoods that are growing and that are therefore
good choices for investment.
FACTOR 2:
You need to learn to learn the various factors that make a property
valuable in a specific area.
FACTOR 3:
You need to learn how to evaluate and appraise real state in order
to determine what kind of a piece you can afford to pay.
FACTOR 4:
You must learn how to negotiate and how to sell people on the idea
of dealing with you,and or selling you terms when they are selling you
their property.

TEN FACTORS TO CONSIDER IN CHOOSING A CITY

1. LEVEL OF BUSINESS ACTIVITY

Start with a big picture. What is the general level of business
activity in the country as a whole? Nationwide recessions and
depressions hurt all real state values everywhere, but nationwide
booms or prosperous economic times, do not necessarily help all
real state values in the same way.

2. LOCAL BUSINESS ACTIVITY

Study the level of local business activity. The most important
indicator to look at is the number of new business start-ups,
and the growth of employment in the area. You need 3% to 4% of
new businesses starting up every year just to maintain the same
level of employment because of the rate of job and company
attrition.

3. IDENTIFY THE TRENDS IN EMPLOYMENT

Examine changes in the employment and income sources for the
community. Is industry or business moving in or out? Are the
Government offices moving in or out? Where are the jobs coming
from,and where are the jobs going? The level of employment will
have an enormous impact on rental rates.

4. STUDY LOCAL INTEREST RATES AND FINANCING

Before investing in a city,you must determine the general financing
terms and interest rates of real state in that area.Are they going
up or down? Are interest rates higher or lower than the national
averages? How much of a down payment will you have to make to buy
a home in that particular area? What kind of terms can you get?
What kind of interest rates will you have to pay on mortgage
financing?

5. STUDY POPULATION TRENDS

You must understand the trends in population growth or decline. Here
is an important formula.Real state prices increases at twice the
rate of population growth and/or three times the rate of inflation.
This means that,if there was no inflation, and the population was
growing 3%per year,real state prices would grow at two times 3% or
6% per year.If the population remained stable, but inflation was
growing at 3%per year,home prices would increase at three times that,
or 9% per year.
But let say that you have 3% population growth and 3%inflation rate.
That would be a total of 6% plus 9% would be 15% increase or upward
preasure on real state prices,specially home prices,in any given
12 months period.
It is therefore important that you look at population growth or
decline.If population is declining, real state values will decline
at twice that rate.If an area is losing 2%population per annum,
real state values will decline at 4% in that area. This would not
a good area in which to invest.NEVER TRY TO BUCK THE TREND.

6. IDENTIFY THE TASTE AND PREFERENCE

Study the changes in the taste and preference of home buyers.What
kind of home do people want now? What kind of homes will they want
in the future? How does that compare with the homes that are for
sale at the present time?
Many home are built in a style that is outdated. People don't want
to live in that type of house. It is very important that you don't
invest in those houses,no matter what kind of a price you can get.
Think a long term.

7. DETERMINE THE LEVEL OF BUILDING ACTIVITY

Find out the volume of building activity and construction cost
levels and trends. How many new homes are build each year relative
to the rate of absorption? In other words,if an area requires 1000
new houses new year for the growing population,and developers are
building 1000 new houses per year, you will have very little upward
preasure on housing prices.
8. CHECK THE VACANCY RATE

You must consider the vacancy rate in the area in which you are
thinking of investing. This perhaps the most important single factor
affecting real state market trends and values. The basic rule is
that a vacancy rate below 5% in apartment or other rental accomodation
is good. This vacancy rate causes upward preasure on home prices.
A vacancy rate above 10% is poor and causes downward preasure on
home prices. A vacancy rate between 5% to 10% is a factor that you
must use your judgement to evaluate.

9. ANALYSE THE RELATIONSHIP BETWEEN NUMBERS

Study the relationship between prices, rents,and construction costs.
These are important market conditions. For example,wide differences
between listing and final sales prices are specially significant.
In most markets,85% to 90% is a common difference between the
listing price and what the purchaser actually pays. If the ratio
is above or below that, it can have a positive or negative effect
on home prices.
For example,in one area,a typical house is listed for P100,000.
Home listing for P100,000 however are selling for P75,000 to P80,000.
These means that there will be downward preasure on home prices.
In another area,if homes are listed for P100,000 are selling at
P95,000, P98,000 or at full price, this means that there will be
upward preasure on home prices.Before you invest in that area, it
is essential that you know the disparity between listing prices and
final sales price.

10. STUDY THE LEVEL OF REAL STATE SALES VOLUME

When investing in a city, you must determine the volume of marketing
activity taking place in real state in that area. This is reflected
in the number of deeds and mortgage recorded, and the volume of
foreclosures.You can get this information down to city hall,ask them
for the statistics on activity within the community. Get sufficient
information so that you can compare present levels of home building,
rental rates, and sales activity with past levels to see if the
market is getting better or worse for home investing.

source: http://st.sulit.com.ph/images/badges/sulitlove_badgepurple.gif