Tips and strategies for women who are beginners in real estate investing
There are women all over the country who would like to become real estate investors but many don't know how to start. Some lack knowledge; some, aware that they lack the necessary knowledge, in turn lack confidence. Where should women who want to get started investing in real estate begin?
The internet is a good place for them to turn.
Women who want to begin investing in real estate can learn some of the basics of investing in real estate by reading educational materials online, and they can develop a familiarity with the topic by reading about current events and trends in the real estate market.
Lack of knowledge is not the only thing that keeps some women from becoming real estate investors; fear is also a contributing factor. Many are afraid of losing money, they're afraid of not making the right decisions...and credit issues are also involved. In addition they don't know how to get started.
Real Estate Investment Clubs
Providing women with industry contacts and education, real estate investment clubs are a good place to start. I recommend that women interested in investing in real estate do a simple internet search for "real estate investing" to find local investment groups to start attending. EOTM just recently launched their new Investment Club geared towards providing newbie investors with resources and key skill sets with success as the end result.
Finding other women to network with can be very beneficial.
In addition to investment clubs specifically pertaining to real estate, I would strongly recommend looking for support from a general business perspective at NAPW, the National Association of Professional Women. They'll get a lot of support from a business owner's perspective and from women in their own area.
Networking
No matter what type of real estate or general investment clubs women seeking to become real estate investors choose to join, such groups can provide them with crucial opportunities for networking, education and support.
The greatest key is knowledge, and women new to real estate investing can benefit from being around other people who do invest to learn the process from those people.
Learning from and working with other women who are experienced real estate investors can also be a good way to gain confidence.Beginning investors should work with someone with experience in real estate investing—get your feet wet a little bit before you go out on your own.
At real estate investment clubs, there are real estate agents and other investors there for them to network with, there are lenders, there are contractors.
Everybody who's related to the real estate industry can be found right there...so they can form their own network there to get them ready for real estate investing. After joining a group, women should put a business plan, or a marketing plan, or a road map together—their checklist of things that they need to do in order to become successful.
Putting together a team of experts to work with when investing is smart. You have your financial team: your accountant, your attorney, a property manager if you're buying to hold property for the long term...people that can assist you and be part of your team so that when you go out to identify and find a deal, nothing is going to stand in the way if the deal makes sense. You've got your people, your money—all your ducks in a row.
If a woman does that, she's going to be very successful in real estate.
Strategies for Women
Considering the credit crunch underway across the country, combined with the potential recession, many women who are interested in becoming real estate investors hesitate because they are nervous about money. More precisely, they are worried about not having enough money to be able to invest in real estate.
I think some women feel that they need to have a lot of capital up front, or their credit may be bad and they don't think they can get started because of that, either.
Let's talk Money
Realistically, investors will need some money up front. It's going to take a little money to get started.One year ago an investor could buy a property with no money down and get it financed for 100 percent. With all the foreclosures going on across the country, that kind of put a thorn in that, and so now [real estate investors need] to come up with some money.Whether that's 10 percent or 20 percent, a lot of them just don't have it.
Fortunately, for women just starting out, there's a lot of different creative strategies, like lease options, that they could do to acquire a property.
Buying pre-foreclosures or foreclosures is another strategy that may suit women in particular well for a variety of reasons. While foreclosure properties tend to be more affordable, they typically must be purchased with cash up front. Pre-foreclosures would be a better option for people without a lot of cash on hand.
Another reason is that, because in many cases women are more nurturing than men, a woman may be able to talk with homeowners who are in pre-foreclosure and get them to let her purchase a house below market price compared to a man approaching them to do that.
The foreclosure market is a place in which many women investing in real estate could find their niche. I think women will play a major role in their commitment to revitalize areas hardest hit by foreclosures. Members of my group, have made a commitment to buying and rehabbing houses in these areas and then sharing equity with properties that they sell. And by doing this, homes become more affordable....We take a little less profit for it, but something has got to stimulate home sales again, particularly in these areas.
Such a strategy allows the investors to profit not just from the revitalization of a particular property, but from the revitalization of a particular area. Such dedication to a community can improve an area's economic outlook. This type of investment is well suited to women because a great advantage that women hold over men is compassion, and empathy.
Outlook
Women are relationship people, we're good at establishing a relationship, we're good at earning trust, and so people want to do business with us. It becomes a lot easier for us to develop a good reputation for delivering a quality product. This is a tremendous advantage for women, particularly when it comes to rehabbing property.
I would also recommend that women who lack experience with do-it-yourself home projects attend classes, such as those offered by hardware and home improvement stores, to learn the basics. Then, if someday they are looking at investing in a property that may require some work, they can make the right decisions about the deal. Do-it-yourself skills could be particularly useful for women who want to rehab properties.
Negotiating can be another important skill for women to concentrate on learning. Women should also learn better negotiation skills and take control.
I don’t think that women are at any inherent disadvantage when it comes to investing in real estate. I think the major disadvantage is probably internal. Women only feel that they lack the power and authority. They feel like they can't do it because investing is a male-dominated field.
Women investing in real estate are not less likely to be successful solely because they are women. It’s not that it's difficult; it's that women tend not to have the confidence, in my opinion. Somebody who's persistent and somebody who believes in themselves, whether male or female, will do just fine.
If you are seriously looking to tap into the Real Estate Investment arena don’t hesitate in contacting Carla Barnes of EOTM Real Estate Group today. 678-548-9466. Also feel free to visit our new Real Estate Investment Club.
Listen live to EOTM Real Estate Hot Talk - Call in & Share Knowledge with US! Because "WE is Greater than "I".
Carla Barnes of EOTM Properties explains how homeowners can turn their unsold properties into rental income. The nation's painful housing bust has put sellers in a serious lurch. To get their properties sold, many sellers will have to make sharp reductions to their asking prices --- a necessary evil that can rob the investment of its return. But Carla Barnes has a different idea. In her new infomercial, Can’t Sell Your Home, Rent it!
.. ..
Carla describes how homeowners can ride out the turbulent market by converting their homes into rental properties. Barnes outlined the benefits of renting, explained how homeowners can determine if it's right for them, and even offered advice on how to avoid lousy tenants.
What are the benefits of renting out your home if you can't sell it?....
There are many benefits, including the ability to ride out the market and potentially not lose money on a home. It generally isn't in a homeowner's best interest to sell at the bottom of a market—unless they have an unusual financial circumstance, such as immediate retirement or illness. Secondly, renting offers the ability to take a tax deduction if there is any rental loss. Moreover, renters have the ability to move back into the home. In other words, if you're not sure that you will like ..Texas.. and want to move there, you can always move back to your ....Georgia.... home if you don't like it.
When would it make the most sense for a homeowner who is unable to sell his home to rent it out?
If you are in the military, renting is a great option. Military personnel often have to move rapidly for deployment, but they cannot sell the home with 10 months' inventory on the books for any reasonable price. Secondly, if you need to move quickly to take a job but don't want to sell your home in a down market, renting is a great alternative. If your home isn't worth what you owe, you might be able to modify the loan to change the principle balance and rent it out to ride out the market.
.. ..
Feel free to contact Carla Barnes of EOTM Properties today for a free rental analysis of your most prized investment @ 678-548-9466
How do you know if you are getting a good return on your real estate investment? Calculating the ROI on your investment property is critical to knowing how your investment is performing, or when comparing one investment to another.
In order to successfully decide whether a property is worth buying, an investor must run the numbers to calculate two types of returns: Cash-on-cash return on investment, and total return on investment.
Cash on Cash Return on Investment
The cash on cash return on investment is the before-tax cash flow (BTCF) divided by your initial cash investment. The formula looks like this:
Cash on Cash Return on Investment = BTCF / Initial Cash Investment
Your before-tax cash flow is calculated by subtracting your annual mortgage payment from your net operating income (NOI). The net operating income is simply the total income from the property minus the total expenses.
Let’s take a look at an example using a $150,000 income property purchased with a 20% down payment of $30,000. Let’s assume your mortgage of $120,000 is fixed for 30 years at a 7 percent interest rate.
Let’s assume your BTCF is $3,000 per year ($250 per month):
Cash on Cash ROI = $3,000 / $30,000 = 10.0%
Through the “magic” of leverage using financing to purchase your property, you have created a cash on cash ROI of 10%. This would be quite attractive to most investors in today’s market.
The cash on cash ROI is a good measure of a property’s first year financial performance. However, it does not include the additional benefits achieved through real estate such as the amortization of the mortgage and any future appreciation. The total return on investment addresses that.
Total Return on Investment
The total return on investment (TROI) provides a better and more complete measure of a property’s financial performance. That is because it factors in amortization and appreciation gained over time.
Total ROI = (BTCF + Net Sales Proceeds – Initial Cash Investment) / Initial Cash Investment
In order to calculate the total return on investment, one must project the BTCF for each year of expected ownership as well as the net sales proceeds from the sale of the property.
Let’s take our example above and assume that we plan to sell it in five years with an average annual appreciation rate of 4% per year. After five years our $150,000 property would be worth $182,498, and our mortgage balance would be $111,665. Let’s also assume that our selling expenses total 5% of the sales price, or $9,125.
Using the figures above, our net sales proceeds from the sale of the property in year five would be $61,708 ($182,498 – $111,665 – $9,125). Additionally, our before tax cash flow after five years would total $15,000 assuming no annual increase in rents or cash flow. Now our formula looks like this:
Total Return on Investment = ($15,000 + $61,708 – $30,000) / $30,000 = 156%
Note that some investors calculate their TROI using their after-tax cash flow (ATCF) instead of the BTCF. This can provide a deeper “bottom line” measure of the return on investment; however, it does not provide a good measure to compare one investment to another since tax liabilities will vary between individual investors. Calculating the TROI using ATCF is best suited for investor specific use.
By projecting a property’s future cash flows and appreciation, you can calculate the potential gains on your initial cash invested (down payment). Assuming the property is not declining in value, the TROI should increase in each successive year.
However, total return on investment can be a little shortsighted when used in isolation. This is because total return on investment does not measure of the property’s financial performance as it relates to its equity. For this we must calculate the property’s return on equity (ROE). Similar to the TROI, the return on equity calculation replaces the initial cash invested with the properties equity in a given year.
Please feel free to submit all mortgage and real estate related questions directly to me via email @ carla@eotmrealestategroup.com.
Ask about New Investment Properties Under $30,000!
Buying Real Estate With All Cash
In an up and down market there are those investors that will dig up opportunities regardless of the state of the economy. These types of individuals are known as the "Warren Buffets" of Real Estate. They understand that in the current climate banks are holding on to their cash with a wait and see attitude. Savvy investors are finding that buying with "All-cash" works as a viable strategy for acquiring residential and commercial bank owned properties. The investors with a wait and see attitude for institutional lending and financing are missing a great opportunity to buy while everything is on sale. Rock bottom prices in the residential and commercial markets in part have been driven down by the scarce availability of credit. Stop waiting and start taking advantage of the Investors Buyers Market in Atlanta. Contact Carla Barnes of EOTM to get started!
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Lately, we have been getting a sleu of new requests for our property management services here in Atlanta from Homeowners/Investors wanting to know what they should look for when picking a property manager. Its a great question, and I’ll try to cover a few important points. I’m going to ask more questions then I’ll answer, but these are questions you’ll want to keep in mind when interviewing managers.
1 - Cost: Managers generally charge a monthly fee to watch and maintain your property. Those fees can range from as low as 5% or so, to upwards of 20%. Obviously, you should look for a company that charges less and provides more services.
2 - Communication: For me, communication any company rendering services to the public is of the utmost importance. I need someone who uses email, and is responsive to both the telephone and email. If I don’t get a response back in a timely manner, it is time to walk. In addition, you need someone who can deal with you and your idiosynchricies. Some of us are needier then others. You want to let companies know up front where you stand, and make sure they’re willing to be flexible for you.
3 - Termination of your Agreement: In the event that your “relationship” does not work out, you want to know up front what exactly it will take to terminate your agreement. Is there a charge for breaking your contract? Penalties?
4 - Repairs and Maintenance: Does the company have their own maintenance crew, or do they contract out to a handyman? How much do they bill out at? Can they handle all kinds of repairs? What happens if they can’t do something? Do they have other contractors that they work with?
In addition, you probably want to have a maximum that the company can spend without contacting you. Generally, most will allow managers to do what they need to as long as it is for something under $200. You should confirm any expenses over that.
If you are a bit more of a control person, you can also request invoices/reciepts for expenses.
5 - Monthly Statements: Does the company send out monthly or quarterly statements. You should not deal with anyone that does not provide monthly income/expense statements.
6 - Evictions: How does the company handle evictions? What are the costs to evict?
7 - Yard Work: How much do they bill yard work out at? Landscaping? Do they handle snow removal? Mow lawns? How much does each cost?
8 - Reserves: What kind of reserve does the company require? The reserves are used in case anything comes up. Most managers will require a certain amount.
9 - Accounting: When will the manager mail your check to you? Beginning of the month? State laws usually dictate accounting rules for managers, but you wo want to know all of this up front. Tenant Deposits: How do they handle deposits? Are they comingled, or simply put together with all other income for your account?
10 - Vacancies: I’ve actually interviewed companies that will charge you 1/2 a month’s rent to one full month once vacany is filled. This is standard.
11 - Advertising: Where do they advertise properties? Are for rent signs put on the property’s lawn? Do they advertise in the paper? Online? There are quite a few effective places to advertise properties for free, online. Do they use these? In addition, you want your property advertised effectively. Do they have the basic HTML skills to add images to their for rent ads online? This makes a huge difference, trust me.
12 - Section 8 or Tax Credit: Do they have experience dealing with section 8 properties / tenants? Do they know what is entailed with such properties?
I also like to know how many properties they manage, how many managers work at the company, what specific areas they focus on, how long they have been in the business, and other questions about their experience. This should be a good start to get you going. Feel free to check out our site to learn about our services and fees. We currently manage properties in Atlanta and surrounding Cities.
EOTM Real Estate Group launches the H.O.M.E. Initiative. A new program dedicated to helping those homeowners that were directly affected by the Mortgage Meltdown. Launching programs and seminars whereas these consumers can get back on track to homeownership, being educated on the process along the way.
Accelerating Positive Change In The Mortgage Industry
EOTM Real Estate Group is stepping up to the plate. Taking responsibility for having played a part in making the Real Estate/Mortgage Industry what it is today.
"EOTM Real Estate Group's Community Building Initiative is to right a wrong, so to speak. Creating hope, sooner rather than later. Building stronger building blocks, the kind that will withstand storms and leave a legacy for our children. An initiative that is needed". Carla Barnes, President of EOTM Real Estate Group says.
Community Building Activists
The EOTM Real Estate Group's community initiative will first and foremost help find quality homes for qualified individuals. "It's such an unfortunate situation, considering these hardworking families have probably filed bankruptcy as a means to try and save their homes. Making it almost impossible for owners/property managers to rent to them." Carla Barnes says. EOTM will be placing the candidates in homes for 12 - 24 months under a rental agreement or lease to purchase. Within that time frame these families will work hand in hand with credit coaches, debt consolidation experts and other mortgage/real estate professionals to help put them back on track to homeownership.
EOTM will be offering free seminars online and traditonal in the hopes of educating consumers .. tips they need to know before obtaining their next mortgage. Understanding credit, how it works and more. Helping to turn the once subprime borrower into prime borrowers. Building stronger communities in the process.
EOTM currently has homes available to rent or lease with option all across Atlanta and quickly expanding into other regions.
Helping to build stronger communities is the ultimate goal. Investors, Lenders, Builders, lock arms with EOTM Real Estate Group Today. Bring the H.O.M.E. initiative into your community.
"A Home Is a Terrible Thing To Waste, Next Time You Buy Make The Decision To Keep It"
Are You a Mortgage or Real Estate Professional? Join our initiative, contact Carla for more info @ 678.548.9466
In light of the continuing housing market decline, Real Estate professionals have seen a rental market boom particularly in highly populated metro areas like Atlanta. Various rental reports demonstrate market factors like job growth definitely influences local rents differently. However, the broader trend in the data indicates the rental market continues to strengthen nationally, which is a hopeful finding to say the least amidst the mortgage meltdown. One factor that we are seeing are the increased number of renters waiting out the market coupled with investors and property owners who are buying foreclosed homes at lower prices and allowing EOTM Properties to manage them as rentals.
Thinking of Moving to Atlanta?
Well, now is a great time to do a move to the Atlanta area. The home rental market is alive and thriving and there appears to be a good supply of desirable houses and condominiums on the market and rents are very reasonable. If you see a property you like, then be prepared to place a rent holding deposit and secure it. Use EOTM Properties, Featured Listings as your base of operations in locating your Atlanta or Surrounding area home to lease, Bookmark our site now.
When beginning your search for a property to rent, it is a good idea to obtain local maps and guides. Use the internet mapping services like Yahoo! Maps to find a property under consideration. Then use driving instructions, just right off the map, to get directions and find out how far it is from your job or other landmark.
Gather information you will need to complete the rental application in advance. You may need the name, phone number and address for current and prior employers, current and prior landlords name and phone number, your current and prior addresses, bank account info. in case of emergency contact person and their phone number. And, of course, bring your checkbook with two blank checks, one for the application fee and one for rent holding deposit.
When calling a management company to inquiry about renting a property, provide the following information. This will allow the agent to help you find what you are looking for in the most efficient manner. You will get attention faster by naming the address of the property you are interested in.
1. What area of Atlanta are you interested in? Name the county and/or city. 2. What is the rent range you are looking for? 3. How soon can you move in? 4. What type and size home are you looking for? 5. How long of a lease are you looking for? (Most houses have a 12 month minimum) 6. Who will move in with you? 7. Do you have pets? If so, describe the type, breed, size.
Here is some general information about renting a home in Atlanta. However, each company sets their own policies and this is merely general information to help you, the rental prospect understands what's involved.
Applications fees in Atlanta average about $50. Security deposits are normally equal to one month's rent and are due in certified funds at time of move in. A rent holding deposit equal to the first months rent is generally due with the application and may hold the property for you, once approved. Pet fees or deposits vary among landlords. Always ask how much is refundable. Unfortunately for pet owners, it is getting harder to find owners willing to accept pets, especially large pets or certain breeds.
The rental term for a home lease usually is for a minimum 12 months but up to 24 month or longer are available in some cases. You should specify on the rental application what needs to be done before you move in. Only about some of the houses come with refrigerators and most do not come with washer or dryers. Most apartments do come with refrigerators. Window covering may or may not be left with the property. It is best to specify on the application whether these items remain.
Always sign a lease agreement, do not move in with only a verbal agreement. Written move in inspections are mandatory and are in your best interest. Always get a copy of the inspection at time of move in.
Most landlords will only lease a vacant property for a future move in up to 2 or 3 weeks without the rent starting.
I hope this helps in your search for a home to rent. Please feel free to submit any questions you may have and I promise to respond within 48 hours.
We are currently seeking properties in the hapeville, east point, fairburn area for our qualified prospects. 3, 4, 5 and 6 bedroom homes!
Allow us the opportunity to place great tenants in your investment properties for 1-2 years! Contact Carla Barnes for more details on our Property Management and Tenant Placement Services @ 678.548.9466
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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