The purpose of obtaining an appraisal is to have a professional determining the current value of a property. The definition of a market value is the highest price in terms of money which a property will bring in a competitive and open market under all condition requisite to a fair sale, a buyer and seller, each acting prudently, knowledgeably, and assuming the price is not affected by undue stimulus.
The majority of people in the world dream of becoming successful from childhood. They define success as earning an endless amount of money, driving the most recent and luxurious car on the market and living in a house that’s so big that you couldn’t even imagine. Do all of these luxuries come from working extremely hard at one workplace for many years or having the perfect career? The truth is that many of the wealthy people in this world have a source of passive income. In some cases, many people have a side job to make passive income for which they choose how and when they would like to work.
Flipping Real estate for dummies sound bit arrogant but This is the term used for newbie’s too. You might have seen shows on television explaining, how Flipping Real Estate For Dummies. Majority of the shows show you how you can purchase run down property, fix it and sell it to make profit; But that’s not true. Majority of the time, the cost of renovations, time, carrying cost and overall investment could lead you to a huge loss and you may end up with a house that nobody wants to purchase.
There are many strategies for investing in real estate. Few of them are good for every kind of market. When the markets are low, it’s a good time to buy and hold property. When the markets are high there are opportunities to buy property low and then sell it for a quick profit. A savvy investor will have a number of techniques for adapting to the changing market in order to find ways to both make a profit and protect existing investments.
Lease Option Real Estate Investing
More traditional means of investing in real estate tend to be considered safer.Prospective real estate investors like to start and even where many seasoned investors like to stay today. This might involve finding a good investment property” perhaps even a multi-unit residence” and renting it out, making enough profit to cover the mortgage, insurance, taxes, utilities, etc. and sitting back and enjoying the monthly cash flow. Others prefer to find an investment property to fix and flip, or rehabilitate as some like to call it, and then sell for a much higher price. Unfortunately for these types of investments, there is much that must come together successfully just to make a profit.
Some people may make some great profit on a few deals, only to lose it all on the next. Perhaps at that point they will be lucky enough to find a savvy investor to buy their failed investment and save them from bankruptcy. Even if partly successful, there are many headaches with these types of deals such as dealing with bad tenants, spending weekends on changing light bulbs or unclogging toilets, dealing with contractors, or the worst” not finding a tenant, or not getting enough rent and working with a negative cash flow. Personally, I don’t need these headaches, and believe there are much easier and much less risky ways to invest in real estate that are also extremely lucrative.
First of all, prospective tenants need to be properly screened” verifying income, credit situation, employment, and so on. They need to be qualified for the lease as well as the final purchase of the property. Secondly, the real estate needs to be located in areas that provide strong investment opportunities with proven inflation and stable employment opportunities. We need to be certain that both the tenant and property are solid investment vehicles.
With lease to own program, the tenants are screened and verified to ensure that they will be able to afford the monthly lease as well as the final purchase price before even closing on the property! This means we have the investment vehicle and exit strategy in place before any transaction takes place. Furthermore, we do all of the research to determine competitive lease rates, inflation rates, hot investment areas, and so on. Of course, we don’t have all of the expertise ourselves” we rely heavily on strategic partnerships across Canada to ensure we have experts and up to date knowledge in the best places to invest across the country. There is much that has to come together make these opportunities available. Fortunately, for you as the real estate investor, we have done the heavy work for you. We have made it as easy as possible for you to invest in real estate and get the kind of returns that only real estate can offer. Our opportunities will produce a minimum of 20%. By providing the minimum down payment for the property, we will put your name on the title and pay you a monthly cash return as well as pay out when the tenant exercises the option to purchase at the end of the lease term.
Of course every investment has risks and you will want to be fully aware of them before investing a cent. The biggest risk would be investing in real estate without knowing the risks, or just plain lack of experience.By investing through our program you are investing in experts who have done all of the research on the investment for you.We have mitigated every possible risk and through our program they are narrowed down to just a few:firstly, if the tenants walks away from the property.This is highly unlikely, since the tenant would also be walking away from their down payment as well a large sum of money they would have saved in a mandatory trust through the monthly lease option payments.Furthermore, if they do actually walk away, we have ensured that the property is in a sought-after neighbourhood and city, in which case we will find another lease to own tenant and take another down payment.Secondly, if the tenant is not able to qualify for a mortgage at the end of the lease term, we may extend the term until they qualify, or in a worst case, ask them to leave and find a new tenant.
These continue to come through and produce solid returns in any economy.Consider both possibilities”when the economy is good, people have money to spend and will be seeking home ownership.When the economy is in recession, lease to own may be the only option left to own a home after credit problems or bankruptcies.Either way, our investments are cash flow positive with a fixed purchase price based on inflation.
With our lease to own program, investing in real estate could not be easier. These investments are even RSP-eligible. Imagine seeing your RSP produce a 20% return” and that only our minimum” we often see opportunities produce as high as 60%!If you are interested in the kind of low-risk, high returns and passive income that only real estate can provide then it behooves you consider our incredible opportunities for investment.
World Wealth Builders offers many unique, practical, out of the box real estate investor apprenticeship which offers the student hands on, in the trenches style instruction to facilitate both a different mindset as well as a successful and lucrative real estate investment business. You can attend Real Estate Millionaire Apprenticeship . To find out more, please go to www.WorldWealthBuilders.com/live.html
The above information is provided as a guideline and is not intended to give a professional legal advice. Please consult a real estate lawyer for their opinion on your particular case
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Your success is our Passion!
The price of land can drastically change depending on the purpose it used for, infrastructure changes in the city around it. When changing a piece of land from agriculture to commercial use, you can multiply your profits by as much as 10 times the original amount.
As a Canadian Real Estate investor and mentor, I often see novice Canadian Real Estate investors making the same exact mistakes. As a result, I decided to create the following list to help novices understand what these common mistakes are and how to avoid them.
The good news is that all of these mistakes can be easily corrected.
The bad news is that any one of these mistakes will seriously limit your potential for success. In my experience, these are the 9 most common mistakes I see novice real estate investors make:
1) Not getting an education/information
Getting an education is a critical part of becoming a successful Canadian real estate investor. It’s much easier and less costly to educate yourself than to make mistakes in the real world. We are lucky to live in a country full of educational opportunities for whichever endeavor we want to pursue.
Surprisingly though, not everyone takes the initiative to learn before they take action. This exposes these people to costly (and sometimes career-ending) mistakes that could have easily been avoided. Some misguided people even complain that the books, courses, or seminars promoted by Canadian real estate experts are too expensive. I guess that depends on where you stand.
To me, they seem cheap compared to what I know can be earned in this business. Perhaps to a novice though, they may seem expensive. But as the saying goes, “If you think education is expensive, try ignorance.” Think about it.
Is a $5000 apprenticeship worth it if what you learn makes you $5,000 on a single wholesale deal? What if it could save you a mere $5,000 on a single rehab? Or what if it helped you to create an extra $200 per month cash flow on a single property for just one year? Would it be worth it to you? The value of an education often doesn’t reveal itself until you’ve stepped up to the plate and put yourself in the game.
2) Not getting an education from the right people
The internet is a great tool. But it’s also saturated with too much information – good and bad, oftentimes, from less than credible sources. So don’t confuse the information you find on the internet as necessarily being quality information. For example, there are a number of Canadian real estate investing newsgroups and blogs that have proliferated on the internet.
Many so called experts on these sites are more than willing to share enough information to get you into trouble.
I can’t believe some of the misinformation I’ve seen posted on these sites. Remember, anyone can post on a newsgroup and anyone can create a blog. But just because someone has a blog, doesn’t mean they necessarily know what they’re talking about. The misinformation you get may be costly…in either lost profits or reputation.
Novice investors may also get misinformation from friends or family members. Perhaps they dabbled in real estate at one point. Now they feel entitled to tell you what little they may know about real estate investing. Be extremely wary of people who have “dabbled” in anything. Dabblers are rarely experts in anything. As the saying goes, “Jack of all trades, master of nothing.”
3) Not taking action
If you’ve managed to get a good education from a good source, the next step is to take some action. Knowledge will be power only when you begin to apply it properly. Merely buying a wide array of real estate investing products or attending boot camps isn’t going to make you any money.
Some novices neglect to take action because they’re still searching for that magical secret that is going to make it start raining deals. The real secret is hard work! Others are paralyzed by fear of what might happen if they get one of their offers accepted. Or, they may give up making offers if they don’t experience instant success.
Whatever the reason, not taking consistent action is a sure way to fail at anything. Personally, I believe that initial failure is the universe’s way of forcing us to make sure we truly want what we’re pursuing. In the end, persistence is what leads to success. And the more we persist, the closer we get to success.
Many novices regularly attend their local real estate clubs. Clubs and associations are excellent way to network with other like-minded people, learn techniques and strategies, and have fun.
Unfortunately, I’ve met countless club goers who have never done a deal before. Instead of using the club as a spring board into taking action, they tend to use the club as a warm blanket because they fear being out on their own. When I meet these people, my advice to them is to stop sitting around with the other novices talking about all the deals they would like to be doing.
My advice is simple, go out there and get some deals done. We all need a good apprenticeship. But that is only one step in the process. There is no substitute for hard work.
4) Not having realistic expectations
Most novice Canadian real estate investors have unrealistic expectations. It may be about the amount of repairs a property needs, the time it takes to complete a project, or the profit they should get from a deal. They’re expectations are either too high or too low. If they’re wholesaling properties, they may get too greedy and try to charge the rehabber too much.
If they’re rehabbing properties, they may underestimate the repairs required.
If they’re landlording, they may underestimate the amount of maintenance a property will require or forget to factor in vacancies. While getting an education or being apprentice plays a large role in these mistakes, another reason is that they did not leave enough room for error. They assumed everything would go as planned.
Real estate deals rarely go exactly as planned. Experienced investors understand the importance of planning for the unexpected. This way, when things don’t go as planned it’s not the end of the world.
5) Not treating real estate investing as a business
Contrary to popular belief, real estate investing is not like the stock market. It is not a passive investment. It is an active investment. Whether a novice investor’s intentions are to flip or to own rentals, they sometimes think owning real estate is going to be a lot easier than it is.
While the profit potential in real estate is usually much greater than owning a stock, it inherently requires more effort than most passive types of investments. Whether you’re wholesaling, rehabbing, or landlording, real estate requires your time and constant attention. In this way, it’s more like a business than an investment.
For example, you must be disciplined about your business. You need to set a schedule for yourself and stick to it. You need to set policies and procedures and adhere to them. You need to set goals and do whatever you can to achieve them. Not everyone has that level of discipline without a boss telling them what to do. When you run your own business, you are the boss. You must be willing to make sacrifices to succeed.
For you this might mean that you need to turn off the television and read your home-study courses. It might mean that instead of spending money on new clothes, you invest that money in your business.
Or it might mean that instead of going to the park on Saturday you search the MLS and forum at Professional real estate investors group (PREIG) Canada look at properties, and familiarize yourself with your target neighborhoods.
6) Not being patient
It can take awhile for novice investors to see positive results when starting out. You can’t expect to immediately find deals and make money. It may take several months to get your first deal. As a comparison, new real estate agents are often told by their brokers that it may take up to six months to close their first transaction.
Similarly, real estate investors should expect to wait a few months to close their first transaction. Furthermore, it can take years for your real estate investing business to become a thriving venture. There aren’t too many businesses that become profitable immediately – no matter the type of business.
It often takes several years for most businesses to get to a point where they make steady and reliable profits. Running your own business can be fun and extremely rewarding. But rest assured, the early years can be unpredictable. As a result, you need to have a lot of patience for things to take off.
7) Not concentrating on quality deals
This is one of the biggest mistakes I see novice investors make, especially after they have done a few deals. After they have some success, they begin to focus too much on quantity instead of doing quality deals. This mindset leads them to do less profitable deals. And once an investor begins to do thinner deals for the sake of doing more deals and outdoing their competition, they eventually find themselves in trouble.
Unfortunately, this is a lesson that most investors learn the hard way. For some reason, avoiding the temptation to focus on quantity is a principle that most investors have a hard time accepting. Their natural inclination is to do more. They might feel the pressure to tell their friends what new project they’re working on. They might feel bored unless they’re working on something new. Or they might feel guilty about not “staying busy.”
Whatever the reason, novices must learn that investing is an activity in which “staying busy” is not always smart. Sometimes, the best deals are the ones you don’t do.
When an investor learns to concentrate on a small number of quality deals, they enjoy not only better profits, but also a better lifestyle since they’re not running around managing a huge portfolio of properties. For most people, the whole point of getting into real estate investing in the first place is to live a better quality of life, not to work longer and harder.
8) Not moving on from bad deals fast enough
Since novice real investors usually don’t have a steady stream of leads coming in and don’t know what a truly profitable deal looks like, they tend to overanalyze bad deals far too long. They get anxious and want to get deals done. And even when they put the numbers of the deal into their spreadsheet and see the deal clearly doesn’t work, they still find a reason to justify it.
They logically know that a deal should be avoided, but they try to justify it anyway. While I believe everyone needs to start somewhere, the ideal place for a novice real estate investor to start is in a good deal not a bad one.
What novices eventually learn is that not too long after taking on a marginal deal, a great deal is not far behind. But because they’ve tied up their resources with the marginal deal, they can’t pursue the great deal.
9) Not writing down goals
Don’t try to run your business without a clear plan. Clarify your goals by committing them to writing. Then, revisit them once a week until they become reality. Something magical happens when you write down your goals on paper.
They begin to take root. When you focus on them repeatedly, you nurture them and they begin to grow. It’s important to write down your purpose, strategies, and goals. Begin by asking yourself the following questions:
- What strategy am I pursuing?
- What will I do with the properties I will buy?
- How many deals per year will I do?
- How much profit will I earn per deal?
- How many offers do I make to make this happen?
- What kind of life do I want to live outside of the office?
When you’re clear about your goals, you have a much easier time accomplishing them. And if your goals are unrealistic you should change them as necessary. Don’t get stuck in an unrealistic set of goals that will only produce frustration. At the same time, you shouldn’t change your goals too often either.
It’s hard to hit a moving target. You want to strike a good balance between having reasonable, achievable goals and also setting goals that will force you to get outside your comfort zone.
Your success is our business!
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Why invest in Real Estate? Despite the economic ups and downs that we have experienced in recent times with stock markets, secure investments such as in the real estate market continue to offer you the greatest and most consistent opportunities to build wealth and financial security for your future. In the most basic manner the most advantageous benefit of investment in real estate is that by doing so, this provides a hedge against inflation.
Is now a good time to be investing in Canadian Real Estate?
Yes! It is. Investing in Canadian Real Estate must be done by getting proper education in the form of Strategies, forgivable grants and teaming up with high caliber professionals to guide you through out. But if you are a sophisticated Canadian Professional Real Estate
Investor with proper Canadian Real Estate education and use proven Canadian strategies, you can build wealth anytime.