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Archive for March, 2010

Commercial Property Versus Residential Property

March 17th, 2010

While most small investors tend to go straight to residential property when wanting to make some kind of real estate investment – probably because they are more familiar with the market – sometimes commercial property might be able to provide a better return. Consider these advantages and disadvantages of commercial and residential properties for investors:

Commercial properties tend to have much longer leases – perhaps even as long as ten or twenty years – whereas residential properties are likely to lease for just one year or less. This kind of stability can be a great asset.
Banks are less likely to lend you money easily for a commercial property because it’s more complicated – so if your credit is not too great, investing in residential property might prove easier.
Once you have tenants in a commercial property, you can be fairly sure they will take excellent care of the property because it is the front for their business – if it looks bad, it’s bad for business. Residential tenants are not always so careful.
It can be a lot more difficult to find tenants for a commercial property, because of course the market of people seeking it is considerably smaller.

Tips for Managing Your Vacation Rental Property

March 16th, 2010

Managing your vacation rental property doesn’t need to be a difficult task, and if you can avoid having to pay an agency fees then obviously your investment will be even more worthwhile. Some useful tips for managing your vacation rental property successfully are:

Arrange to take payments by credit card and bank transfer. Being able to use a credit card to pay can sometimes be the deciding factor for a guest considering several properties.
Find several suitable places to advertise your vacation rental property. Don’t rely on just one website or one regular advertisement in a newspaper or magazine. Also make sure you are able to include several photographs in your advertising, because this can also make a difference to a potential guest’s decision.
Make sure you have workable arrangements for cleaning and maintaining the property between guests. If the vacation rental property is near where you live, you may be able to do this yourself, but even then it is helpful to have a cleaner in mind who can help you out at short notice. Hire someone who you trust to let you know if there is anything damaged or not working at your vacation rental property so you can avoid any guest complaints.

photo credit:?Koshyk

Beware Cheap Investment Property Options

March 15th, 2010

If you are in the market for an investment property, then naturally your ears will prick up if you hear or see details of a potential investment property that seems particularly cheap or good value. However, don’t go jumping in to buy it without consider a few important points first. There might be a reason that it’s cheap, the kind of reason that will damage its potential as a good investment for you. Check these points:

Something unusual might be happening in the area where the property is located – for example, a new highway is about to be built right behind it, the zoning regulations are changing, or a power plant will be built across the street. Get detailed local information before you make a decision.
If you are thinking of buying in another country – where property is often cheaper – there may be pitfalls that will make your investment not as worthwhile as you hope. Check, for example, the tax laws, ownership laws, the procedure for selling the property later, and so on.
There might be some hidden damage or maintenance needed on the property. For this reason, it is always good to have a building inspection carried out; if this uncovers the fact that the roof needs to be replaced, then you know straight away why the property’s selling price seems like a bargain.

5 Ways to Increase Property Value

March 12th, 2010

Whether you’re a property manager and want to increase the property value to draw a higher class of tenants, or if you’re a homeowner and just want to increase your home’s value for a future resale, the following five tips can help you increase your property value.

Storage

Storage is a key issue for renters, home buyers and homeowners. Improve the storage options on your property by adding more, cleaning them up, or adding compartments that make storage easier.

Make Repairs

Too many homeowners and landlords ignore little repairs and let them slide as they’re not essential but this habit should be avoided and all repairs should be made as promptly as possible.

Curb Appeal

Curb appeal is always essential, make sure your home looks good from the road, whether it’s just a simply lawn cutting or something more complex like intricate landscaping, every home looks better when the lawn and exterior is well cared for.

Safety

Take additional safety steps by adding home security, improved locks, motion detectors and improved lighting.

Clean

Not the typical cleaning where you dust a little and run a vacuum once a week, but thorough regular cleaning will keep everything in the house looking its best and in optimal working order.

Problems to Avoid When Moving House

March 11th, 2010

They say that moving house is one of life’s most stressful events, and it’s also not something many of us do too often – so it can certainly provide a few challenges. Here’s a list of common problems that occur when moving house, and if you are aware of these possibilities in advance, you might be able to avoid some disasters!

Breakages of your belongings – whether you pack yourself or use professionals, there is always the possibility that not everything will turn up intact at your new home.
Children (and even pets) can be particularly distressed or badly affected by the upheaval of a move.
Delays in finance or contractual arrangements, especially with the place you’re moving to – you might end up having to move out but having nowhere to go for a few days or weeks.
Services like electricity, gas, water, telephone and the internet may be cut off too early in your old house and not connected quickly enough in the new place.
Costs related to moving house can blow out quickly if you don’t keep an eye on them. Professional removalists can charge extra if they need to dismantle furniture themselves or you might need to pay for a night or two in a hotel if the move is not completed within a day.

photo credit:?awnisALAN

Screening Potential Tenants for your Rental Property By Email

March 10th, 2010

I had an interesting experience recently, when I needed to find new tenants for my small rental property. Not interested in paying huge rates to advertise in the local weekend newspaper, I found a well-used online website to advertise at a much cheaper rate, uploaded a few photos and the details of my property, and waited.

It wasn’t long before the replies from potential tenants started rolling in. Since it was advertised online, most of the potentials chose to reply using email, which was actually great for me – it was easy to collate the information about them and arrange a viewing with several of them at once.

As I read their emails, I found myself immediately screening them into good possibilities and bad. I discovered you can tell a lot about a person by what kind of email they write in reply to such an ad – whether they bothered to write a coherent message or just sent me a text-message style query without the normal politeness or niceties you’d expect. I arranged to meet some from each category, and interestingly the ones who hadn’t been professional about their communication with me generally turned out to be unreliable – and I figure if they can’t turn up punctually to a viewing, then they may also find it hard to pay their rent punctually. Those who treated their response to the ad more professionally certainly gave me a better overall impression – and it’s one of those responses who’s become my now reliable tenant.

New FHA Insurance Fund

March 9th, 2010

New news for homebuyers and sellers, the FHA has announced a plan to secure the solvency of the Insurance Fund. There are a number of ramifications of this plan and some are predicting that the end result will once again be a slow down in the housing market which had just begun to see a little lift in the last year.

One of the big changes that we’ll be seeing is an end to the first time homebuyer tax credit. Not an entirely shocking announcement as this tax credit was so generous it was pretty clear that it would not be permanent.

Another change will be that the government’s purchase of mortgage backed securities will end. In 2008 almost all loans in the secondary market were bought by the government by stepping out of the market, mortgage rates are almost certain to rise, causing a whole slew of repercussions.

To make matters a little bit worse guidelines are being tightened on loans. The goal is to lessen defaults but it will ultimately mean fewer people can purchase a home and the qualifications will be more stringent.

Of course this is just the FHA’s announcement about their plan, it’s not a certainty at this point but it does seem fairly certain that things will go forward.

photo credit:?Kamal H.

4 Ways to Keep Your Tenants Happy

March 8th, 2010

Keeping tenants is much more profitable than finding new tenants so the key to being a prosperous landlord who doesn’t have added troubles and work is to keep your tenants happy. The following four tips can help you keep your tenants in your property and insure everyone’s happiness.

Business Attitude

Treat your tenants with professional respect. Don’t gossip with tenants or become their buddy but treat them with respect, a polite demeanor and take them seriously. Let them know that you will listen to their complaints in an even and fair manner and treat no one with favoritism.

Be Available

Whether it’s you, a manager, or a property management company, someone always needs to be available to deal with tenant issues. Some of these issues will be emergencies and others can be handled later, but no matter what your tenant will want to be heard. Taking initiative and routinely contacting your tenants through a phone call, email, letter, or in person will go even further to let them know they matter.

Safety First

Always put your tenants’ safety first and don’t be afraid to let them know this. Let them know when safety related repairs are being made or if you’re taking steps to prevent break ins and theft.

Additional Conveniences

Whenever possible, give your tenants those little extras. Bus tickets, group discounts, a picnic table, new landscaping or any little thing that you can provide that will be appreciated by most of your tenants. If they feel respected and like you care they’re more likely to treat you with respect and hold up their end of the agreement.

Celebrating the End of Your Mortgage

March 5th, 2010

Can you imagine a day when you make the final payment on your mortgage? For many of us, paying off our home mortgage seems like a dream that is far, far away. But sometimes it’s nice to sit back and consider the possibility that one day in the future, you will receive a bank statement for your mortgage with a nil balance. After all, that’s what you’re striving for.

How will you celebrate this auspicious occasion? Daydream about it for a moment – will you celebrate with a fancy meal at your favorite restaurant, or a party in the house that you now fully own? And it’s not only the one-off occasion of the day you make the final repayment – there is also all the time after that when you have this extra money available to you, now that it’s not going into the mortgage – what do you think you might do with it? Of course, some of it should be invested, but spoiling yourself with a couple of treats is a fair deal.

Sometimes we get bogged down in the everyday events of life and paying off the mortgage is just another one of the many chores we’re burdened with. Take a moment to remember that it won’t always be that way, and your day might get a bit brighter.

Selling Your House As Fast As Possible

March 4th, 2010

When selling your property quickly is the most important consideration – but you don’t want to drop the price too low – then these tips will help you achieve the fastest sale possible.

Clean it beautifully, declutter your rooms and make everything sparkle – a less than perfect house sells faster if it looks clean and neat. If necessary, pack away some of your belongings and store them until you move.
Repair those niggling faults that you’ve been putting off for years – a dripping tap will make a prospective buyer wonder what else is wrong with the plumbing, even though everything else might actually be in order.
Don’t spend a lot of money, but be prepared to put time and energy into improving the appearance of the house – this might involving painting walls or fences, doing some serious gardening work or washing windows and window frames.
Importantly, do enough research to be sure you are asking the right price for your house – ideally, that means just on market value and be open to offers slightly below market value. If you need to sell your house quickly, you need to immediately attract buyers in the right price range so there’s no point overpricing it and expecting people to make much lower offers – these people might dismiss your house without looking at it.

photo credit:?The Pug Father