How Much Effort Will You Put into Being a Real Estate Investor

A key question in determining how successful you will be as an investor is this: How much effort are you willing to invest in working with real estate? For example, if you are thinking of buying rental property, there can be a lot more work involved with the process than you might think. To make this clear, look at some of the responsibilities of owning a six-unit apartment building. Many of the day-to-day activities can be handled by a property management firm, but keep in mind, management companies often charge 10 percent of a property’s gross income, plus other fees, for their services.

When you own an apartment building, many tasks must be attended to. You can do some, even most, of them yourself, or you can hire people to take care of the work for you. If you hire people to do the job, you will recover less profit at the end of the year. However, you have to factor in what your time is worth. It may be less costly for you to pay someone else to manage your properties than it would be to take time away from your earning capacity. Once you acquire a building, it may need some immediate maintenance or repairs. If not, this type of work certainly will be required over time. Are you handy with tools? Will you do some of the work yourself? Do you have time to call contractors and meet them to schedule work you are not qualified to do? Not all buildings require a lot of attention in terms of maintenance and repair, but some do.

Every landlord knows that tenants make the world go around. Will you design, write, and place your own advertisements for tenants when you must fill an empty apartment? Can you be available to show the apartment to prospective tenants at various times during the day and evening? Does it frighten you to meet strangers after just one phone call? Are you equipped to screen the tenants, pull credit reports on them, check references, and do your best to get good tenants? Showing and renting apartments can be time consuming when you own several buildings or even one larger property.

Still other responsibilities exist. Who will cover the move-in and move-out checklists? Managing rental properties is not easy work. Even if you hire a management company to do most of the work for you, not all management companies do their jobs as well as you might like. For this reason, a successful investor monitors his management company carefully. Any way you look at it, handling rental properties is not stress free.

Pending Increase in Home Sales: Time to Stick Your Toe Back into Real Estate?

Property prices have fallen 25% from their 2006 peak (S P;/Case-Shiller index). The free fall has continued right through the year in 2008. Can it ever get worse than this? Are these prices too lucrative to invest in the real estate market or pick up stocks in real estate? Do we have some economic indicators that would signal the revival of the market? When should one start investing? The answer to this can be found in some history and some economic indicators.

The Great Real Estate Market Crash in Florida in 1920’s saw prices falling down to as high as 80%. The real estate prices in Tokyo’s prime properties in 2004 fell to 10% of its peak. These statistics only tell you that the extent of a real estate crash cannot be limited to a percentage nor can it tell you the right time to buy. It is time then that you started looking at some economic indicators to guide you better

Indicators of a declining market

Job Losses: With rampant job cuts, home owners will find it difficult to pay off their mortgages while organizations will be stuck with excess office space. Defaulting home owners and organizations with excess space will increase the supply in the market thus bringing a further pressure on the prices of real estate

Desperate Government Measures: Industries seeking bailout from the Government gives a feeling of the lack of stability in the economy. For real estate prices to begin gaining some momentum there needs to be an environment of confidence which is clearly missing at this point in time. When the situation is desperate it’s better to keep a tab on the market but keep out till you are confident.

Risk Taking ability of Banks: The willingness of Banks to finance homes with ease also indicates their confidence in the immediate future of the real estate market. With banks stringent with their purse strings, making it difficult to finance a home or office space, buyers would find it more difficult to finance the properties thus creating a lower demand in the market

How should one then approach the real estate market when one is now sure of the immediate future of the market?

Investing in Realty Stocks:

As it goes with any stock, it would be only prudent to check the financials. Realty stocks are at a higher risk due to asset valuation methods. Unrealistic valuation will only mean there would be nothing much left on the right side of the balance sheet. Invest in stocks at a time when the economy is improving and in those stocks that have been known to stand the test of time over a long period of time and believe in fair market valuations.

A smart investor learns from other’s mistakes and gains from his own prudent judgment. Wait and watch for the pending increase in home sales before you put in all your money. You may be able to enter the market at a price marginally higher than the absolute bottom but then you would also be more or less confident that the worst is over.

Here are some stocks that come out clearly as winners for the year ahead in 2009. It would make sense to keep a tab on their progress.

E-House (NYSE: EJ)

E-House is China’s largest real estate agency. The stock has been on the downward trend but the revenues and profits keep going up. It has managed a revenue growth rate of 58.3% in the last 3 years. Sales were up four fold in the October holiday season on a year-on-year basis. Even in these trying times, revenues and profits are both up by over 90% YOY. E-House has been profitable right from inception and looks attractive at current valuations. Make the most of the downtrend.

Ventas (NYSE: VTR)

If there is one word to describe Ventas, it is prudence. A prudent management that has taken steps right from the early indicators in 2007 is the major contributor to the attractive valuation and prospects. A health care and senior housing REIT, Ventas more than doubled its net income in the 3rd quarter of 2008.

NorthStar Realty Finance (NYSE: NRF)

Even in this economy of no foreseeable limit to home owners defaulting, Northstar Realty Finance comes out completely clean with no delinquencies on principal or interest. A liquidity advantage of $280 million and a 35% growth rate assures this company of a strong position in trying times.

 

Disclaimer: No positions

Strategies to Develop Solid Real Estate Leads

Obtaining quality real estate leads is essential for those involved in the business of buying, selling, or trading properties and cash flow notes. Leads are particularly important to real estate investors who specialize in flipping houses or offer seller-financing with investment properties.

Building a list of real estate leads can be accomplished by various means. Some investors purchase lists, but this is not one of the better practices. Purchased lists are oftentimes outdated or contain erroneous information. While investors might obtain a few quality leads, the majority of time these lists are a dead-end street.

A better option is to spend time building relationships with real estate professionals. These can include realtors, mortgage brokers, mortgage bankers, property inspectors, real estate appraisers, attorneys, probate court employees, and other investors.

Most investors participate in social networking groups or become members of local real estate clubs. Online groups provide opportunities to meet professionals around the globe. One of the most popular venues is Facebook which lets investors create fan pages to promote their services and generate potential leads.

Another popular online venue is LinkedIn. In addition to developing a network of professional contacts, LinkedIn offers a powerful advertising platform that allows investors to effectively and affordably reach their target market.

Real estate investors can also take advantage of online marketing strategies such as developing a business website or blog; publishing audio podcasts; and sharing informative videos that showcase investment properties for sale or offer homes for rent.

Developing a website provides the perfect venue for list building. Investors can quickly build a list of targeted real estate leads by offering informative reports, regularly publishing electronic newsletters, or providing investment opportunities via email.

Investors only need to subscribe to a list building service and insert a snippet of code on the website. Visitors opt-in by providing their email address. Investors can then broadcast marketing messages to every subscriber at the click of a button.

Providing helpful information to subscribers is an affordable way to build relationships and develop trust. Real estate is one of the most important investments people make. Investors who take time to earn subscribers trust will create an invaluable list of leads that allows them to consistently generate sales.

Real estate blogs are another marketing tool that can help investors showcase properties and investment products using a personal approach. Investors can list their blog in a variety of blog directories. Investors can offer the option of subscribing to their mailing list and setup RSS feeds which allow subscribers instant access to newly published info.

It is best to spend time conducting market research to determine which online strategies yield the highest return on investment. It is also important to develop a marketing plan to ensure efforts are directed at the proper target market.

Investors who specialize in buying and selling distressed properties should spend time networking with mortgage brokers, bankers, realtors, and investors. Those who specialize in buying probate real estate will want to develop relationships with probate attorneys and probate court record researchers.

Taking time to determine the most suitable demographic market and the people involved in those markets allows investors the opportunity to build effective real estate leads lists. This is turn, reduces advertising costs and minimizes time spent scouting out buyers for investment products offered.

Sources:

Experian Real Estate Leads

Facebook

LinkedIn

Florida Real Estate Market: The Correction is Underway

The housing market is ripe for an adjustment, a year or two of flat or falling prices followed by very modest increases for awhile. of the top six markets that will be hardest hit with dropping housing prices, half are in Florida. A recent report says cost of Florida housing rose at twice the national average for the last five years, with people in only nine other states spending a bigger chunk of their income on housing.

What does not show up in these reports is the great increase in property insurance, taxes and utilities this year, mainly caused by the hurricane onslaught of last year. Across Florida the average price of existing homes in August 2006 was almost unchanged from twelve months ago, with best and worst being the Ocala area up about 14% and Panama City down by 15%. The speculation hot spots that went thru fantastic price increases in recent years will be hurt most, with the Gulf cities of Cape Coral dropping about 18% by the third quarter of 07, and Sarasota close behind with a 14% drop.

In the area where I live, a few blocks from me is a duplex that’s been on the market for over a year. also a single family two bedroom one bath with a large back yard on a corner lot, it was for sale by owner for several months and is now listed with Century 21. both are in a good location. don’t understand why they won’t sell. In this same area are several condo conversions that are selling very slowly, some have even been reconverted back to rentals. In downtown St. Petersburg, some upscale condo projects were never started, and buyers were given their deposit back.

The easy availability of interest only and adjustable mortgages is contributing to more foreclosures which keeps expanding the amount of properties for sale.

And it’s the builders taking the brunt of the slowdown, with the construction industry limping into the final weeks of the year with a gloomy outlook for 2007. with the unfolding slowdown, layoffs and lost contracts are creeping across the building trades. In the Tampa Bay area, construction has lost over 2,000 jobs since May, and that does not include many that are self-employed. Laborers are saying it’s like working on a sunday in the many subdivisions that have become a ghost town, and subcontractors are leaving the suburbs looking for jobs.

The trades that support homebuilding are already feeling the pinch, particularly swimming pool builders and drainage contractors.

Is there a turnaround on the horizon? not until 2008 at best.

You’re a New Real Estate Agent: Minimizing Your Expenses

Becoming a real estate agent involves several upfront fees. These include the cost of real estate classes or schooling to prepare you for state licensing, Realtor association fees, MLS registration that allows you to list homes for sale and lock-box key code fees that allow you into locked homes for sale. Some times you have to pay for your own lock-boxes which can become expensive. These are one-time and annual costs you have no control over. Instead, try modifying the rest of your business expenses with the following tips.

Brokerage

Pick a real estate broker that offers you substantial floor time where you have the ability to answer the office phone in an effort to gain new customers. Some brokers will pay for your business cards and other advertising costs for your business. Other brokers have a policy where you share your listing information with the rest of the agents in an effort to boost networking to find a potential buyer. You won’t share commission. This way, everyone in the office is on the look out for buyers for all the listings the brokerage is working on, leading to more overall agent profit. This automatically can reduce your overhead expenses.

Word of Mouth

Learn to let everyone you know about your new business in person or over the phone. It carries more of an impact than a random business card or an email. Learn to capitalize on the, “So what do you do?” question wherever you go. You could even strike up conversations with others and ask them what they do for a living. Usually the person will ask you back giving you the opportunity to speak with them about your vocation. Always ask everyone for potential referrals even when the person you’re speaking with is not looking to buy or sell a home. The more you ask for referrals, the more comfortable you’ll be and eventually this pays off. Remember, the worst someone can say is “No,” and you’re no worse off for leads than you currently are.

Play “I-Spy”

Get in the habit of looking for “For Sale By Owner” signs whenever you’re out. Make this a passion. Contact these owners to see if they are ready to list the house with an agent and if not, then ask them if its OK to keep in touch with them. Sometimes this turns out good and sometimes you’ll hear “No.” Let it go and move on to the next sign.

Your individual situation will vary but by thinking out of the box and taking advantage of things you already have at your disposal can reduce your overall overhead expenses while you build your real estate business.

One of the Best Approaches to Real Estate Online Marketing is Search Engine Optimization

As the real estate market gets hyper competitive, turning into a buyer’s market, many top realtors are turning to real estate online marketing. Now, real esate Internet marketing can be a great way to generate leads and ultimately jump start sales – but only if one goes about it correctly. One of the best approaches to real estate online marketing is Search Engine Optimization, or SEO. A reputable SEO consulting firm can work wonders when it comes to driving traffic to your real estate online marketing website.

SEO services are also one of the most effective ways to use your real estate marketing dollars. Traditional advertisements in print and broadcast media is costly; rates for even a quarter-page ad in a national magazine can run thousands of dollars, with no guarantees and no way to measure results.

SEO is a proven scientific approach to increasing web traffic to a given site by raising search engine rankings. In other words, you want to be sure that when a potential client enters keyword phrases related to real estate into a search engine that your realtor internet marketing website is at or near the top of the results. Studies show that web surfers rarely go beyond the third web page of results, which is why it is vital to make sure your real estate marketing website is among the first s/he sees.

After the initial consultation, SEO consultants conduct in-depth research in order to determine exactly what keyword phrases are currently being used by people online in order to find relevant results. When it comes to real estate marketing, this is not always as obvious as it seems; the words Internet users might choose to look for a particular product or service are not always the same as those that would be used by someone in the business.

Keywords used in real estate online marketing may also change over time, which is one reason why an SEO realtor internet marketing campaign, done properly, can take several weeks or months.

There are also keywords that are used in the actual code of a web page. These are called meta tags. These are essentially descriptors for the benefit of search engines’ indexing software; most will be similar to the keyword search terms used in the actual web search for your real estate internet marketing site, but there are often some differences as well.

Another important factor in real estate online marketing are “backlinks,” or links from other websites leading back to your own realtor Internet marketing site. This is one of the major cornerstones of real estate internet marketing, as search engines base website rankings on this kind of data. SEO consultants are able to generate such backlinks for your real estate agent online marketing website using a number of different methods.

Real Estate Agents- Learn to Get Leads, Follow Up, Automatically

Real estate agents comprise my biggest group of clients. I get lots of requests for help setting up websites, linking to MLS systems, etc. But when I suggest they set up an auto responder, they usually give me a funny look – like “how much more is this going to cost me?”. Truly, adding an auto responder to your web marketing activities will not ‘cost’ you – it will actually ‘pay’ you. The concept is simple: get your visitor to your web page and collect their email address. Sounds easy, right? Well, that depends – on what you are giving the potential subscriber in return. Are you just saying something like – “join my email list” with a vague or non-existent benefit? Or are you offering the visitor something valuable to them in return, like a free report, free market data or something similar?

Here are some report giveaway ideas:

* “Ten Mistakes Most Home Sellers Make”

* “How To Get Top Dollar For Your Home”

* “Home Sales Data In Yourtown, NY”

You can easily type up a 10-30 page report, create a pdf of your document and upload it to go out with the first message of your auto responder. Then follow up every 5-7 days with additional information.

It’s probably a good idea to offer 2 reports: one attractive to buyers and one to sellers and maintain separate mailing lists for each. Then you need to create a sequence of messages that provide timely, relevant information to your prospect. Time your messages 5-7 days apart to keep them interested, without feeling like they are getting spammed. Don’t be afraid to send them your content – remember, they have demonstrated by signing up that they are interested in what you have to say.

Use the personalization features of the auto responder system. This allows you to use the lead’s first name in the subject line of the email like this: “Joe, Here Are 10 Mistakes To Avoid”. Any good auto responder software will allow you to do this. Set up your sign up form to collect the lead’s first name as well as their email address. This will allow you to add the powerful feature of personalization.

Don’t try to use an inexpensive script that you host on your own web service – pay the $20-30 a month to use a well-recognized auto responder service. Not only will you have the benefit of much better features, tech support and advice, you’ll have the best benefit of all: deliverability. The big auto responder companies most valuable asset is their ability to deliver your email without it going into someones spam filter. Don’t cut corners here – if your domain gets on a spam list, your auto responder is dead- use a commercial service.

Finally, consider blogging as an adjunct to your email campaign. You can configure your auto responder to send out a message to your list every time you add a post to your blog – this is a great way to get your already interested subscribers back to your web site.

Here Is A Reliable Auto Responder Service