Posts tagged "real estate investing"

YEAR END CLEAN UP FOR REAL ESTATE INVESTORS

Charlie Einsmann's Weekly Food for Thought
The year’s end is near. 2016 is coming to a wrap, and it’s time for real estate investors to start tying up loose ends and preparing for next year. However, just because the year is almost over doesn’t mean that it’s time to relax. In fact, there’s no better time to dive head-first into your business. The end of the year is perfect for revising your real estate strategies, preparing for taxes, preparing for banks and of course calculating your liquidity!!!  With that in mind, here are some real estate business tips you’ll want to implement before the ball drops.
 

Evaluate and Revise your Business Plan

As you approach the end of the year, you need to take a look at your business plan. Evaluate the information in it, and compare it with the statistics from the year. This will allow you to revise so you can eliminate tactics that did not work, change your goals as needed, and readjust the information so that it’s more accurate. This is an important real estate marketing tip, as the more precise your business plan, the easier it is to achieve your goals moving forward.

Prepare for Taxes

The end of the year may not be the end of your fiscal year but for us it is our end of year.  However, it may still be the perfect time for you to gather, organize, and prepare for taxes.  In addition, by covering this task now, you can free up your schedule for later when you might need to better focus on marketing. So, hire an accountant or purchase a tax software system, gather your receipts, analyze your income, and take care of taxes while you have the availability to do so.
 

Prepare for Banks

If you are like us you might have some credit lines with a bank or two or three.  There are a few things that you need to do for the banks.  The first thing each bank will want to see is your taxes (see previous section).  The second thing the bank will want to see is a year end balance sheet (or net worth statement).  A balance sheet is just simply a compilation of your assets and liabilities used to compute a net worth.  We do this on many fronts.  We do this for all of our LLC’s which eventually become part of our personal balance
sheet.  The next thing that a bank will want to see is an income statement.  This is a spreadsheet of your income minus you expenses.  Again we will do this for our LLC’s and then factor that into our personal income statement.  Having these things ready by late January early February is always a good way to get a head start on the year.
 

Liquidity

We do this at least once a quarter but you should ALWAYS do this at the end of the year.  Liquidity means how quickly you can get your hands on your cash. In simpler terms, liquidity is to get your money whenever you need it.  Liquidity also plays an important role as it allows you to seize opportunities.  Liquidity is the sum of your cash on hand, availability on HELOCs (Home Equity Lines of Credit), easily cashable instruments such as bonds etc, other bank line availability (including credit cards, be careful here), access to other forms of cash from friends and family etc…  If you have cash and easy access to fund and a great deal comes along, then it’s easier for you to seize that opportunity.  Again for us we have two different forms of liquidity.  We have it in the form of our LLC’s and on our personal side.
 
Coming out on top for the year’s end may require different tactics from what you use throughout the year. However, these small adjustments to your real estate business can end the year successfully, whether it’s with more sales, more investment properties or a clear and organized path for the future.
 
 Let us know in comments below your thoughts, questions, concerns. We’d love to hear from you!
 

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Posted by Charlie Einsmann in Personal Finances and tagged , , , , , , ,

A Conversation with my 25-year Old Self

3 Tips to My Younger Self

Last month was a very productive month here at the Capital City REIA, wouldn’t you say? We kicked July off with the long anticipated two-day Riches n Niches workshop and what a fantastic turnout we had. Our goal was to impart maximum knowledge in two days, and I dare say, mission accomplished!

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On day 1, the insights and questions were fast and free-flowing. From 8:30am to 5:30pm, Tammy shared some of her most successful strategies for investing in multi-units and commercial properties. The heavy dose of knowledge continued into the afternoon as Brian Ginter, an experienced appraiser and member  of the Capital City REIA, and Jim Hellman, a commercial lender, each shared their experiences on the funding side of commercial real estate investing. It was an energetic first day, complete with rapid-fire Q&A and a networking session that carried on long after the seminar wrapped up for the day.

How much better can a seminar get? Hands-on better. I’m talking about day 2 of the workshop of course, which we spent out in the field engaging in a mystery-unraveling, phobia-reducing exercise for novice and experienced investors alike. We pulled away from the hotel at 9am in two charter buses and headed to Baltimore to see, touch, and experience multi-unit and assisted living facility projects in the brick. Learning from the owner-inventors how the properties were acquired, financed – with little to no money down! – and are being rehabbed was enlightening to say the least.

There was plenty of  learning and networking to be enjoyed by investors of all experience levels. One recurring thought I had throughout this workshop and one that surfaces frequently at events I attend is, “…that’s it? Why didn’t I think of that earlier?” or, “Wait a minute…I knew that! I could be doing that already!”

That’s right, so many innovative money generating ideas that seem so simple and that I never thought to integrate into my own investing agenda sooner. Take short sales for instance. I need some cash to fund my first buy and hold in the capital city (see what I did there), and I’ve known about the short sales strategy for a while. Based on my networking experience, it clearly works, so why haven’t I created short sale opportunities for myself?

We’ve all suffered from this strange “knowing but not implementing” syndrome. There’s many a justification for the habit, ranging from laziness to lack of confidence in following through. Our brains are also constantly acquiring information that needs to brew and incubate before we are compelled to act. It takes time to bring out hidden details and make non-obvious connections between ideas. Think about it, how have you learned some of your most valuable investing lessons to-date? Probably the hard way through trial and error.

Nothing is a waste of time if you use experience wisely. Look back five years and you’ll appreciate the evolution of your investing tactics. Five years ago, I was a weary eyed 25-year old quickly catching on to the drawbacks of working towards someone else’s dream. It seems like just the other day, yet when I reflect on what has changed since, I am humbled by my growth from reckless spender to novice investor. If I could share what I know now with my younger self, here’s is what I would say to help me achieve my goals faster and see results earlier:

 

#3. Fail fast, and often


You want financial security but you don’t know where to start? How about anywhere that piques your interest. Pick a starting point, immerse yourself in the learning process and do not be frightened by your sense of unease. Somewhere beyond the edges of our comfort zones lie failure and success, and you won’t know whether you’re falling or flying unless you jump off the cliff first.

Failure is more common than anyone likes to admit, especially when the learning curve is steep. Rightly so, failing bruises the ego. Yet it also serves a higher purpose beyond dishing out a slice of humble pie. It also presents a natural opportunity for self-improvement. How else can you develop the strength and endurance of your armor if you don’t test it?  

Don’t shy away from failure, fear regret instead. Embrace failure as an opportunity to learn, adapt and adjust to life’s curve balls. The resilience and toughness you develop along the way will serve you well in overcoming more complex and unexpected challenges in the future.


#2. Get Clear on Your Vision

Your time on earth is limited, making it the most precious of all gifts bestowed on you. Making decisions on how your utilize your time is an investment strategy that starts with identifying the relationships with your champions and in activities that genuinely interest you and expand your horizons. It really is that simple. Trust your intuition and sound judgment and get clear on which opportunities presented enhance your life and which ones detract from your time. Then, make a conscious choice. When you say “yes”, act on it. When you say “no”, stand your ground. And when you make the wrong call, learn the lesson and move on.

My father, a gynecologist and one of my champions, urged me repeatedly to look into real estate when I was 24. My intuition sensed the possibilities in his words, yet I was overwhelmed by the unfamiliarity of the industry and I bulked under the weight of the information I found. I did not realize it at that time, but I quickly gave up, thus saying no to an opportunity that thankfully, found me years later. The second time my interest in real estate was stirred, I jumped on the opportunity to learn, and here I am with my Capital City REIA family.

There’s an old saying that states, “the best time to plant a tree was twenty years ago. The second best time is now.”

Which leads me to my next tip.


#1. There’s no time like now

If investing has taught me anything, it is to strike while the iron is hot. There is a distinction between feeling ready and feeling right. When it comes to moving forward, readiness is very much dictated by our levels of confidence , and confidence is a fickle emotion in the face of uncertainty.

Young me, instead of the condo, go for the duplex and let a tenant pay your mortgage. Use your savings to purchase the next property and keep the momentum going. No practical knowledge? No problem. Invest in some real estate knowledge and seek out like-minded individuals who know what they are doing. Need guidance? Find a mentor. There are wonderful people out there who love to teach what they know. Where do you find a tenant? It’s all about marketing. You’ll learn all about this when you start attending workshops and events on real estate investing.

Real Estate Investing

No amount of preparation and due diligence can guarantee a perfect result because there are always outside forces at play. If you attended Ms. Valarie Scott’s presentation on short sales on July 27th, you will remember she urged us, the audience, to grab the bulls by the horn start doing short sales now. In fact, when I mentioned the topic of this post to Ms. Valarie, she had the following to say to her younger self, “Get a mentor ASAP and start investing right away. Don’t procrastinate! Wasting time is missing out on opportunities and deals. These missed opportunities could positively change your circumstance[s] and life.”

The perfect time to act on new and improved information is now.

And you can do so by diving into a steep but necessary learning curve to understand the new information. Or by learning from past experiences rather than indulging in moments of self-recrimination. You should also consider getting guidance from an expert in the field as the short sales Queen advised.  And lucky you, Tammy provides coaching and mentoring exclusively to members of the Capital City REIA’s Inner Circle on successfully navigating multi-unit investing. Why reinvent the wheel when Tammy already created it?  If interested, just leave a comment below and someone from our team will reach out to you with details on the latest program that starts August 13th-14th, 2016.

Based on current information, what kind of a conversation would you have with your less-experienced 25-year old self? What investing tips would you urge your younger self to act on immediately? Leave your comments below!

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Posted by Fatma Kibwana in Learn About Money and tagged , , , , , , ,

The BEST Rehabbing Event of the YEAR!

Golden_star_with_red_borderAre you interested in Rehabbing? Not sure how to start Rehabbing? If you are ready to dive right in and invest, than Wednesday is a must attend event!
Learn How To:
  • Hone your Skills on Estimating Repairs!

Experience the entire process of estimating repairs in detail, drawing from our extensive knowledge. 

  • Establish Your Buying Criteria                                                                                                                 

We will help you create your buying criteria so you know which properties to buy

  • To Look for and How to Evaluate Properties                                                              

We will show you EXACTLY what to look during a walk thru ~ When to bring in professionals to help you identify problems

  • Evaluate the Details when Walking through a Property                                                                      

Know what to look at first, second, and third. Plus what items to check that might kill the deal.

  • Estimate the Costs of the Most Common Repair Items                                                                     

We will go over specific numbers for each of the major repair items you will encounter.

  • Put Together a Killer Scope of Work                                                                                        

This alone is GUARANTEED to add profit to your bottom line

  • Follow The Rehabbing Process Step by Step                                                                                       

How to plan the rehab in the most efficient way possible. What to fix 1st, 2nd & 3rd.

  • Do the Layout and Design

Learn when and how to make layout changes, add additions and maximize spaces

  • Know What to Fix / What NOT to Fix                                                                                                       

No need to rebuild a house when rehabbing it. Learn what to fix and what to leave alone.

  • Understand: The Complex Permitting Process                                                                                       

Learn how the permit process works with inspectors, engineers, architects, and other professionals.

 

This event is going to be AMAZING!!!

Until then Investors and Rehabbers…. I look forward to seeing you on Wednesday Sept 23rd!

Hampton Inn – Alexandria, VA
5821 Richmond Hwy Alexandria
6-9:30 PM

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Posted by admin in Events, Property Rehabs and tagged , , ,

A Rehabbing Experience

multi unitI just received this email from a fellow “rehabber” and great friend and thought I’d share it with you especially since I’ve been getting lots of calls, emails and texts about these very things….
 
“I can remember my very first rehab (back in 2009) like it was yesterday.  I was very excited to rehab a house in the city and “improve the neighborhood”.  I lovingly picked out the coolest finishes, making the house as nice as I possibly could.  I eagerly went to the project every day for months to check on progress, anxiously awaiting the day when it finally could be sold for a huge profit! (In fact I can remember the neighbors exclaiming “Hey! There’s that guy again!” LOL I was a regular!)

When the day finally came and I was sitting at the settlement table looking at the numbers, my excitement turned to despair as I realized that I had lost money..not just a little bit of money..a ton of money.

What did I do wrong?

Did I pay too much for the property?  -No, I got a great deal on the shell.

Did I sell for too little?  -No, I got full market price.

Then  I went back and looked at my expenses…..

I had paid too much…for just about everything. 

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Posted by admin in Events, Property Rehabs and tagged , , ,

How to Buy Bank NOTES

MoneyTreeI am sure you’ve heard of investors who buy discounted Performing & Non Performing NOTES? Maybe not? Tomorrow night is your chance to join one of the Nation’s leading Note Educators – Joe Varnadore with Note School.

Joe is going to show you how you can “catch the wave” and get in on buying notes for 20-30 cents on the dollar from the banks. REO’s are now a thing of the past and banks are begging investors to purchase the non-performing notes they are holding.

Joe will unleash the furry of today’s market shift and how you can get in on the action while the getting is good!!!

Hedge Funds and other Cash Buyers are investing Billions right now. Billions of this “anxious money” has found it’s way to hedge fund companies. So what are these hedge funds buying today?

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Posted by admin in Events, Notes and tagged , ,

Advantages of Multi-Unit Investing

multi unitThere are several reasons why investing in multi-unit properties is the best and safest way to enter into the real estate investor world. Multi-unit investors enjoy the reduced vacancy risk, because they’re not simply relying on 1 income stream per property. Here are 5 additional advantages of multi-unit investing:

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Posted by admin in Multi-Unit Investing and tagged , ,