The desire to live in an area with a top-notch school district influences many homebuyers. Most parents will do whatever it takes to ensure a great education for their children. But the reality is that you don’t need to drop a great deal of money on private schools to make sure your children are learning. And you don’t need to move to the priciest parts of the country to get into a top-rated public school.

Just head to the Chicago suburb of Aurora, IL which topped Realtor.com®’s list of the most affordable housing markets with the best elementary schools in the country. It’s also 45% more affordable than the surrounding metro area.

Schools on this list received at least an 8 out of 10 ranking by education information group GreatSchools.org in the largest 15 metros where buyers can find a home without breaking the bank. In the study, researchers looked at the monthly housing costs (mortgage payments, taxes, etc.) needed to purchase a median-priced home in all of the ZIP codes in each metro. They found that the monthly cost of owning a median-priced home in the top elementary housing markets is, on average, just 23 percent of the median household income in the ZIP. That is 41 percent less costly than the surrounding metro area. They also filtered out the ZIP codes with high crime and poverty rates, and for geographic diversity included only one ZIP code per metro.

These markets offer strong public schools and affordable homes, making them a great fit for homebuyers with elementary school-age children:

Aurora, IL

ZIP code: 60503 (outside of Chicago)

Median home list price in ZIP code: $259,900

Top schools: Homestead Elementary School (10 out of 10), Wheatlands Elementary School (8 out of 10), and Wolfs Crossing Elementary School (10 out of 10)

Rosemount, MN

ZIP code: 55068 (outside of Minneapolis)

Median home list price in ZIP code: $299,900

Top schools: Shannon Park Elementary School (10 out of 10)

Huntington Woods, MI

ZIP code: 48070 (outside of Detroit)

Median home list price in ZIP code: $400,000

Top schools: Burton Elementary School (8 out of 10)

Chandler, AZ

ZIP code: 85226 (outside of Phoenix)

Median home list price in ZIP code: $324,155

Top schools: Kyrene De La Mirada Leadership Academy (9 out of 10), Kyrene De La Paloma Elementary School (8 out of 10), Kyrene De Las Brisas Elementary School (9 out of 10), Kyrene del Cielo Elementary School (10 out of 10), Kyrene Traditional Academy, Sureno Campus (9 out of 10), and Paragon Science Academy (9 out of 10)

Some homebuyers might like to take matters into their own hands when they go house hunting, opting to forego using a real estate agent to help with the process. After all, the reasoning goes, if you're the person who will be living there, it seems like you should be the one seeking out what you want. Similarly, there's an assumption that eliminating seemingly extraneous people involved, such as the real estate agent, also cuts the overall associated costs and makes the home less expensive.

However, there are many advantages to working with a real estate agent when buying a house. Consider these five benefits:

1. Expertise

It's true that anyone can buy a house without an agent's assistance. However, real estate agents bring with them years of experience and expertise, and they utilize this wisdom to get you the best deal possible. In addition to specialized training in buying and selling houses, most real estate agents are also licensed professionals and members of various industry-specific organizations. They have access to and knowledge about comparable houses, local neighborhoods and whether a particular property is over- or under-priced. 

2. Convenience

Seeking out a new house that meets your specific criteria, including price range, accommodations and amenities can be a time-consuming process. After this long search, you still need to worry about arranging viewing appointments and work out a deal with the seller's agent. All of this requires a lot of leg work, phone tag and email exchanges. A real estate agent, on the other hand, has easy access to all of this information and will serve as your personal liaison between the seller and his or her agent.

3. Negotiation skills

Even after months of market research, house hunting and reviewing your available options, you still might not find the perfect match. For instance, you might find a home that partially fits your criteria, and with a few upgrades or repairs could be perfect. Negotiating a better deal or a discount on the home's price might not necessarily be your strong suit, but it's a skill real estate agents bring to the table during the transaction. In addition, the agent will be able to identify trouble or potential issues you might not notice. 

A real estate agent brings knowledgeable and experienced negotiation skills first-time homebuyers might not have.

While you might have a good idea of what kind of house you want and your price range, there are a host of other market conditions that will impact what you buy and how much you want to spend. Some of this information can be difficult to come by without access to benchmark data and other industry-specific reports.

As noted by The Balance, a real estate agent can provide you with the contextual data on market conditions to help guide your decision, such as:

• Average per square foot cost of similar homes.
• Median and average sales prices.
• Average days on market.
• Ratios of list-to-sold prices.

Properly leveraging data on market conditions will help you not only identify the best house at the right price, it can be a significant advantage for your position during negotiations.

5. Tailoring contracts

Although most purchase contracts are fairly standard, there are conditions that can be tweaked, removed or inserted accordingly. Since real estate agents deal with these on a regular basis, they have a familiarity with when a contract should be modified to better suit your specific needs and situation, according to Forbes. This provides you with better protections and puts you in a position to meet the conditions outlined in the contract.

When you decide you want to make the move toward becoming a homeowner, one of the first things you’ll need to do is prepare yourself for the home loan application process. From getting a copy of your credit report and scanning it for errors or inaccuracies, to gathering your proof of income, there are a lot of steps involved when it comes to getting your application ready.

Follow these tips for preparing all essential documents for your loan officer.

Create a checklist

My FICO suggests making a checklist of all necessary paperwork so you can make sure you are completely prepared when you submit your application. Unfortunately, not having everything ready or submitting the wrong document can delay approval.

​Reach out to your loan officer and ask for a complete list of all the paperwork needed for a specific loan product. While there might be additional documentation requested, below are some items you’ll need. Remember, these documents are not necessary to apply for a loan:

• Federal tax returns for the last two consecutive years.
• Recent pay stubs.
• Proof of income, including: investments, tips and social security payments.
• Bank statements.
• W2 or 1099 DIV income statements for the last two consecutive years.

Gather personal information

In addition to proving you have the finances to support the purchase of a new home, you will also need to provide personal information to your loan officer. Identification topics include your social security number, legal status and two forms of government identification.

“Reach out to your loan officer and ask for a complete list of all the paperwork needed.”

Come in prepared

Realtor.com indicated that you will want to be able to demonstrate your financial competence and ability to manage a mortgage loan responsibly. Bring along information about whatever home you are interested in purchasing.  Have a folder with everything you need as soon as you head in to speak with your loan officer.

Know who can get your paperwork 

Some of the necessary paperwork can easily be retrieved. However, information about the listing you are interested in will likely need to be gathered from the real estate agent or property manager. This is why you should enlist the help of a professional who has the experience and knowledge to understand what you need and where to retrieve it.

Invest in storage now 

The earlier you get a filing cabinet or other type of organization system, the better off you will be when you decide to apply for a home mortgage. When you have everything in one spot and collect essential documents, the application process will be smooth and efficient.

Becoming more informed and organized will ensure your journey toward homeownership is pleasant and exciting. In addition, having all your documents ready to go minimizes the chances of denial.

Prominent tax advisers still don’t agree on whether all those people who prepaid 2018 property taxes can deduct them in full.

The debate on such deductions arose after Congress passed the largest tax overhaul in three decades late last year. In a landmark change, lawmakers capped write-offs for state and local taxes at $10,000 per return for both single filers and married couples. The provision takes effect for 2018 and will lower these write-offs for millions of Americans.

The overhaul barred deductions for many prepayments of 2018 state and local income taxes, but it was silent on deductions of prepaid property taxes. After Christmas, long lines of people rushing to prepay their 2018 property taxes before year-end gathered at local government office.
​
Then on Dec. 27, the Internal Revenue Service warned that not all prepayments of 2018 property taxes would be deductible on 2017 returns. The agency said that to qualify for a write-off, the tax liability actually had to have been known at the time.

Right away, some tax specialists strongly agreed with the IRS but others strongly disagreed. The IRS and its supporters argued that those who prepaid all their 2018 property taxes can only deduct the portion that was known or determined at the time. In many cases, that means only for a few months of the year or not at all.

The IRS’s opponents argued for higher deductions of reasonable estimates. They based this argument on prior tax rulings and regulations that they think apply to this issue.

Now, three months later, little progress has been made.

Leading the opposition against the IRS’s position is Lawrence Axelrod, an attorney at Ivins, Phillips & Barker.

“The IRS position is misguided because it doesn’t take into account Treasury’s own regulations,” he said.

These regulations allow taxpayers to deduct amounts paid that will be due within 12 months. The IRS and its supporters disagree. They cite court decisions which say that to be deductible, taxes must have been imposed and the amount must be known.

Stephen Baxley, who heads tax planning for Bessemer Trust, a prominent multifamily office, agrees with Mr. Axelrod.

“If the amount is a reasonable estimate made in good faith, it’s deductible,” he says. The firm is responsible for preparing nearly 1,000 individual returns.

Other tax preparers agree with the IRS.

Brian Lovett, a certified public accountant with WithumSmith+Brown in New Jersey, where property taxes tend to be high, says his firm is following the IRS’s guidance: “We think the amount due must be determined for a prepayment to be deductible.”

The correct answer matters.

More than 80% of property-tax revenue is collected by local governments with a fiscal year other than Dec. 31, according to the latest data compiled by the Lincoln Institute of Land Policy. Frequently, the fiscal year ends on June 30.

As a result, total property tax bills for 2018 weren’t determined by year-end in many areas of the country. Many could reasonably be estimated, however.

For example, say John lives in a county with a fiscal year ending June 30. By the end of 2017, he knew he would owe $6,500 in property tax due by June 30, 2018. He could likely assume that his bill for the second half of 2018 would be about the same. So in late December, he prepaid $13,000 for 2018 to his county.

According to the IRS’s position, John can only deduct a prepayment of $6,500—because the amount due for the second half of the year hadn’t been set.

But if Jane lives elsewhere and knew she would actually owe $13,000 in property tax for 2018, she can deduct a prepayment of that amount on her 2017 return.

Some advisers allow both approaches. David Lifson, a CPA with Crowe Horwath who has many high-earning clients, says he recommends that clients deduct prepayments of known amounts. But he will allow a deduction of an estimate, “if I feel the client understands the risk that the IRS will disagree.”

The debate is ongoing. In March, Democrats on the Ways & Means Committee wrote acting IRS Commissioner David Kautter to protest the IRS’s interpretation of the law.

The good news for taxpayers who want to deduct prepayments of estimates is that neither Mr. Lifson nor Mr. Baxley thinks these write-offs need to be disclosed on IRS Form 8275. On it, taxpayers are supposed to disclose risky positions to avoid certain penalties. Supporters of the IRS’s position think the form should be filed, however.

Some taxpayers are also pushing preparers to take the deduction because the audit risk is low, given constraints on IRS resources.

Emily Matthews, a CPA with Edelstein & Co. in Boston, says she explains the IRS’s position to clients. But she says, “I think we’ll see a lot of people who prepaid estimated taxes opt to deduct them.”

As we enter the spring home-buying season, hordes of would-be homeowners are ready to go—but there weren't enough new-home sales in the beginning of the year to quell the already strong demand.

Only about 618,000 newly constructed homes were sold in February, according to a joint report by the U.S. Census Bureau and U.S. Department of Housing and Urban Development. That's down 0.6% from January, but up 0.5% from February 2017.

"There is plenty of room for growth," Chief Economist Danielle Hale said in a statement. "More new-home sales are needed to restore balance in the housing market. ... Today, one in every 10 homes sold is a new home, whereas in a normal market they account for one in every seven homes sold."

Currently, there aren't enough homes to go around, particularly at more affordable prices. The median price of newly constructed homes notched up to $326,800. It's up nearly 0.6% from the previous month and almost 9.7% from the same month a year ago.

That's considerably more than existing homes, which cost a median $241,700 in February, according to a recent National Association of Realtors® report. Newly constructed homes cost more than existing ones thanks to high land, labor, and materials costs. They also typically come with the latest designs, finishes, and appliances.

Only about 13% of the newly constructed homes sold in February cost less than $199,999, according to the report. The bulk of them, about 58%, were between $200,000 and $399,999. An additional 12% cost between $400,000 and $499,999, while 17% were priced at $500,000 and up.

The most new homes were sold in the South, where buyers closed on about 338,000 new homes in February. That's a 9% jump from January and a 0.6% bump from February 2017.
The region was followed by the West, where about 164,000 new homes changed hands.

This represented a 17.6% monthly drop, but a 3.1% annual increase.

Next up was the Midwest, with 79,000 sales, down 3.7% from January and 8.1% from the same month a year earlier. The Northeast had the fewest new-home sales, at just 37,000. But that was up 19.4% from the previous month and 8.8% from February 2017.

Despite a dearth of properties on the market, sales of existing homes rebounded in February, according to a recent report.

After a dip in the number of closings in December and January, about 5.54 million existing homes (which have previously been lived in) were sold in February, according to the most recent National Association of Realtors® report. That represents a 3% rise from January and a 1.1% increase from the same month a year earlier.

"Sales are being driven in the West and the South," says Chief Economist Danielle Hale. That's an indirect result of builders putting up more new residences in those regions. "Inventory is still low in those areas, but the new construction created opportunities for existing-home owners to trade up. It’s leading to faster turnover.”

Indeed, existing-home sales were up 11.4% month over month in the West. They also rose 2.4% year over year. In the South, they jumped 6.6% from January and 3.4% from the same month a year earlier.

However, sales were down in the Midwest, sliding 2.4% from the previous month to the same level as one year ago. In the Northeast, they fell 12.3% from January and 7.2% from February 2016.

Single-family homes, those stand-alone abodes that typically come with a yard out back, saw the biggest jumps. Sales were up 4.2% monthly and 1.8% annually.

But it's still too early to tell what this means for the rest of the year.

"March is where we really start to see a pickup in closings," says Hale. "And March is really the bellwether for the year as far as how the home-selling season is going to go.”

Sale prices also edged up just a little to reach $241,700 in February, according to the report. That's a 0.37% rise from January and a 5.9% jump from February 2017.

However, they were still quite a bit cheaper, by 33.6.%, than the median cost of a newly constructed home, at $323,000 in January, according to the most recent data available from the U.S. Census Bureau and U.S. Department of Housing and Urban Development.

About 53.6% of all existing homes sold in February were closed on for $250,000 or less, according to NAR. About 33.6% were between $250,000 to $500,000 and an additional 10.3% cost between $500,000 and $1 million. Only 2.5% of all sales were for $1 million or up.

Builders recently completed the most newly constructed homes in a decade, says a recent report. Buyers can finally exhale.

About 1,319,000 homes were finished in February—the most that were completed since 2008, according to the seasonally adjusted numbers in the latest residential sales report jointly released by the U.S. Census Bureau and U.S. Department of Housing and Urban Development. That's a 7.8% bump from January and a 13.6% jump from February 2017.

"Hitting a record level of new, finished houses should lead to an increase of more homes on the markets for buyers," says Chief Economist Danielle Hale. "It’s not going to turn from a seller's market to a buyer's market overnight, but this is a step in the right direction.”

The most new, finished homes were in the South, at 659,000 in February. That region was followed by the West, at 336,000; the Midwest, at 164,000; and the Northeast, at 160,000.
But buyers shouldn't rejoice just yet. Fewer newly constructed homes could be coming online this spring—despite the frantic demand. Builders received only 1,298,000 permits in February to put up new homes, a 5.7% drop from January, according to the report. However, it was a 6.5% rise from February 2017.

Permits are considered a good indication of how many completed new homes will hit the market in the coming months.

“There’s plenty more room to grow," says Hale. She'd like to see permits to erect single-family homes rise from 872 in February to 1 million. "It's going to be better than last year, but we're still not back" to precrisis levels.

Housing starts, which means construction that has begun but hasn't been completed, fell 7% from January to February, according to the report. It was down 4% from February of the previous year as well.

"The fall in housing starts in February is a movement in the wrong direction," Lawrence Yun, chief economist of the National Association of Realtors®, said in a statement. "The key to economic prosperity at this juncture of economic expansion is to produce more new homes. That will help with job creation and reduce the swift price appreciation in several markets."

An influx of new construction at all price points could save us from the current housing crunch, but the hefty new tariffs on imported steel announced this week by President Donald Trump, on top of a tariff on Canadian lumber imposed late last year, could make the crunch even worse—and drive up home prices.

The planned tariffs would tack on 25% to the cost of steel, used in home foundations, floors, and high-rise construction, and 10% for aluminum from foreign suppliers. The controversial tariffs would make good on Trump's campaign promise to give American producers a boost.

The administration is already levying tariffs of more than 20% against Canadian soft lumber producers. About a third of the softwood lumber used in new-home construction comes from Canada. And after devastating hurricanes in Houston and Florida and deadly wildfires in California, there is a big need for that lumber.
​
"Tariffs could measurably raise the cost of building materials and hinder home construction of affordable homes," Lawrence Yun, chief economist of the National Association of Realtors®, said in a statement.

Steel is used in the concrete flooring and foundations of most single-family homes. More of it is used in high-rise condo and apartment buildings, plus any dwellings over five floors. It's also used in elevator shafts, parking garages, and many stairwells.

There are alternative materials that builders can use if there is a steel shortage or if prices rise. But those newer materials are typically more expensive, says Jack Kern, director of research at Yardi Matrix, a commercial real estate data and research firm based in Santa Barbara, CA. There are also fewer construction crews trained in how to properly use those materials, Kern says.

“Anything that’s built that uses steel as a component is going to have a price increase," he says. But he doesn't expect it to be a substantial increase and expects it will fade as builders find cheaper, new materials.

That didn't stop builder trade groups from denouncing the new tariffs.

"Given that home builders are already grappling with 20% tariffs on Canadian softwood lumber and that the price of lumber and other key building materials are near record highs, this announcement by the president could not have come at a worse time," Randy Noel, chairman of the National Association of Home Builders, said in a statement. "Tariffs hurt consumers and harm housing affordability."

Several modular home builders have complained to the Modular Building Institute, a trade group, about their costs going up as a result of the tariffs as well.

"This will affect our prices," says Tom Hardiman, executive director of the institute. The association has yet to do a detailed analysis on just how much pricier modular homes may be.

​Not knowing how much steel and lumber will cost makes it difficult for builders to price homes, or for buyers to know just how much they'll be shelling out on their new abodes.
"It hurts home buyers," says Rick Schumacher, editor and publisher of the LBM Journal, which covers the lumber and building materials industry. "It creates uncertainty ... and any uncertainty is bad."

Your rehab is not finished the moment your contractor cleans up.

After the last trim is painted and the appliances are installed, you have one more crucial step that will ensure you a quick sale, STAGING.

For those who are not familiar with STAGING, Staging is the process of creating an emotional experience that leads sellers to make buying decisions much quicker and easier. Staging is a pivotal element in your real estate investing business that does not take much effort, but yields in immense benefits. Bottom line – Staging sells your property faster, which allows you to see your profits sooner.

Staging is simple; you want the buyer walking thru the house to envision themselves living there. You want them to visualize where they would put their furniture, where they will have dinner, and enjoy a movie. Staging does not have to be complicated. You can have a lot of fun and showcase your style. Here are few tips to help stage your rehab.

Home Staging Tip #1: Clean, clean, clean!

Make sure your rehabbed house is clean from all debris, inside and out. You want the house cleaner than if your mother-in-law was coming over for Thanksgiving dinner. Make sure you don’t forget the window sills and little nooks and crannies, dry wall dust gets everywhere. Be meticulous in the kitchen and baths. You should feel comfortable eating your next meal off the floor.

Home Staging Tip #2: Bring a friend or family member

This person needs to not have an emotional connection to the house. You want an unbiased eye to help highlight the positives and distract from any negatives.

Home Staging Tip #3: Pick a Staging Point.

Go to each major room in the house (i.e. Kitchen, Bathrooms, Living room) and select an attractive part of the room to highlight. An example in the living room would be a fireplace. Simply put a mirror or painting on the mantel with some candles and a few logs in the fireplace and you just staged! It’s simple as that. Now your buyer is able to visualize enjoying a roaring fire on a chilly winter night in their new house!

Take advantage of these staging tips before putting your flip house on the market. Your goal is to enhance the “WOW” factor a buyer gets as they preview the property. This will maximize your time. Back to TIP #1 CLEAN, Make sure your contractor cleans up after themselves every night to ensure time isn’t wasted when you are ready to clean. TIP #2 Also talk to your friend or family member that you are going to involve. Tell them what your objective is, as they will be more helpful if they know your goal. TIP #3, you can save a lot of time by picking the features in advance that you want to highlight. If you are unsure of your own style, don’t be afraid to ask a store clerk or friend for help. You can accomplish half the work of staging before your project is finished. Stick to a tight time line and don’t waste a minute. Every wasted minute is narrowing your profits.

Real Estate Investing Basics Tip #1 – The Best Investors Understand Marketing

Marketing is the first area of the business you should study as a beginning real estate investor. Marketing is what makes the phone ring and generates leads. Leads are the lifeblood of your business. They are the oxygen your business breaths. The more leads you have the more money you will make. If you don’t have leads, then you won’t buy any properties. If you don’t buy any properties then you can’t make any money. If you can’t make any money then you can’t build a business. As a result you should spend the majority of your time figuring out how to get your phone to ring with motivated sellers. (The same thing can be said for dating!)

Successful marketing is an art, and those who understand marketing set themselves apart from other investors. There must be a mindset shift as an investor. You are not in the business of flipping homes. You are in the business of generating leads from people who want to sell their home under market value. If you can do this you will control the market and you will figure out the rest of the business very quickly. If you have a potential $80,000.00 dollar pay day on the other end of the phone believe me you learn quickly. 

There are many different forms of marketing you can utilize to get your phone ringing. Direct mail, billboards, TV, cold calling, and networking are all marketing strategies you can use to find deals. The key is to narrow down your market and find your target, develop a compelling message with an irresistible offer, and consistently touch these people with multiple marketing mediums. Then you will want to develop marketing systems so you can repeat this process over and over again.

Real Estate Investing Basics Tip #2 – Wholesale Properties to Build Your Cash Cushion

Once you find the deal now you have to find someone who is willing to buy the deal from you at a higher price. This is where wholesaling comes into play. Wholesaling is the business of finding bargains and selling the deals to bargain hunters at a higher price. You are not adding value to the property. Wholesaling properties should be essential part of every real estate investors business. It is a way to generate income with little to no risk. Many times, you never take ownership of the property – you simply are the transaction coordinator. In essence, you are bringing a buyer and a seller together. Through your marketing efforts, you locate deals and then you assign them to other investors that you locate through your various forms of marketing. If your marketing machine is in motion, you should have no problem finding buyers. Successful marketing and networking in the real estate community will enable you to find wholesale buyers.

Real Estate Investing Basics Tip #3 – Rehabbing for Large Profits

Rehabbing is when you redevelop the property yourself instead of wholesaling the property to someone else. This is where the larger profits lie. The reason is you will be selling the property to a retail buyer who will be willing to pay full market value for the property as opposed to a another investor who is looking for a discount.

Rehabbing is an entire business in itself and there is a lot you need to learn about this niche. It is important if you choose to include rehabbing in your business that you spend time educating yourself first. Learning pricing of labor and materials as well as whom are the qualified contractors in your area is essential to rehabbing properties.

​Being able to add value to properties through renovations is a not only very profitable, but also very rewarding. You are providing a great service, not only to the city in which you do business, but also to the end buyer of your newly remodeled home. When you become experienced at rehabbing you will have the confidence to be able to take on projects that many people would never even consider. This separates you from the other investors and creates more opportunities for you in that real estate market.

Kitchens are the main selling point of any house and therefore should be given proper consideration with regards to layout, design, functionality, finishing materials and adding “sizzle” features. This room is a vital component of any home and is usually the most frequently used space by a homeowner. The kitchen is also the most challenging part of the house to design and rehab, as it is made up of many components and requires coordination between all members of the rehabbing team. Though it is one of the most expensive parts of the house to upgrade, it is also the room that returns the most for every dollar invested.

Some features that should be considered in most kitchens:

“Great Room”

This design concept connects the kitchen with the living room where the families gather to have meals and enjoy entertainment. This concept can be applied through completely knocking out the wall between the kitchen and the living room; removing the top portion of the wall and creating a counter-top/bar feel or creating a picture window opening to connect two spaces together. In this step, it is important to answer the following questions:

• What walls need to be moved / torn down?
• Is it possible to create an opening between rooms? Are there any pipes, vents or other obstacles in the way?
• What is the location for appliances such as a dishwasher, microwave, and refrigerator?
• Where to install electric outlets, plumbing connections and vents?

Cabinets

Cabinets are the most visible part of a kitchen and generally its most expensive component. Therefore proper consideration must be given to this decision, as kitchen cabinets constitute one of the main selling points of a kitchen and therefore of a house. A good rule of thumb is to use comparable properties on the market as a measuring stick for quality of cabinets used. It is also a good idea to visit any new construction sites in the neighborhood to see what is “in style” for your target market. New cabinets typically come in one of three forms: stock cabinets, semi-custom cabinets, and custom cabinets. On average, cabinets represent roughly half the cost of a complete kitchen remodeling. Due to the high cost, it is worth careful consideration with regards to kitchen design.

Some important design features to consider are:

• Storage – is there ample storage in your new kitchen design to accommodate storage for food, cookware, plates, cups, etc.
• Layout – how functional is the flow and did you create a triangle work space. The one between the sink, stove and refrigerator which creates your most used work area.
• Style and Color – make sure the style of cabinet you choose matches the style and era of the house. For example do not put stainless steel contemporary cabinets in a turn of the century colonial home. Color is just as important in the overall kitchen design. Many times white cabinets can make a small kitchen appear larger. On the other hand, you may want to choose a high quality cherry wood cabinet for a much larger space.

Counter-tops

Properly selecting the material type of the counter-top greatly enhances the functionality and appeal of a kitchen. Single family kitchens ideally should have a few different work areas. That means you need to plan for this in your initial kitchen design layout. Work areas are defined as 36 inches of continuous counter-top. Today there are so many choices of material to use, here are a few of the most common:

Counter-top Materials

• Wood – This is not a preferred counter-top material. It is difficult to maintain and prone to dents and cuts that are difficult to fix.
• Tile – This is an attractive and cost-effective material option, although the labor cost is usually greater.
• Steel – Stainless steel provides a commercial, sterile environment. Certain types of steel are virtually indestructible however lighter gauges are subject to dents. Steel counter-tops tend to be expensive.
• Laminate – Laminate is the most popular option because it's the least expensive. If properly maintained the surface can last decades.
• Granite, Marble, Soap Stone, and other hard surfaces – These are the most appealing countertops from a buyer’s perspective. However, the cost is usually much higher and as a result they should only be used in higher end homes.

“Sizzle Features”

These are kitchen design features that are added that help sell the house. They make the kitchen “pop” and stand out among the other houses on the market. As we teach in our rehabbing course you should always try to include at least 4 “sizzle features”:

• Under Cabinet Lighting – when you are installing new wiring in a kitchen it is very simple to provide power for these lights. There are many different styles from florescence to puck style spot lights. Under cabinet lighting provides a dramatic effect and helps highlight new counter-tops.
• Microwave – building in a microwave or installing one above the range helps free up countertop space. (Flip Tip – By installing over the stove it can also serve as a vent for cooking)
• Decorative Backsplash – this kitchen design feature will give a custom look to any kitchen. This small, inexpensive feature adds much in the way of appearance.
• Dishwasher – while many people consider this a standard feature, this is not the case in many of these older homes. Every single family home should have one. Make sure to plan for one in your overall kitchen design.

Kitchens sell homes

You hear that all the time because it is true. Choosing the correct layout, design and finishing materials will help you sell your home quickly and maximize your profit. You will get the most dollar return for dollar spent in the kitchen design. We always teach to stay within a budget, but if you want to add a little something extra in your rehab, the kitchen is one of the best places to do this. A well thought out design, quality materials and dramatic lighting will make the kitchen the best room in the house. So get out there and start planning that perfect space.

First let’s define the term; a surface forming the outside of or bounding a thing. In this case the “thing” is a house. Now that is a fairly simple definition and does not emphasize the importance of what house siding actually does. Siding is meant to protect a building from the adverse effects of weather. It is essential to keeping out moisture and extreme temperatures and to maintaining the longevity of the house. Not only is siding vital to the integrity of the house but it is so important in the overall “curb appeal” as well. We all know how valuable curb appeal is when selling a house. The first thing potential buyers will see is the exterior siding. I can tell you from experience, if buyers pull up and see an ugly exterior, it won’t matter how nice the inside is.

Exterior House Siding Material Selection

House siding comes in a variety of styles and shapes. Here is a list of the most common:

• Wood shingles and shakes are easy to install. However, they are time-consuming and expensive.
• Plank siding (also known as wood siding) offer a pleasing, natural appearance at moderate cost. Clapboard is a common example. Plank siding requires more maintenance than most other alternative siding products and can be a fire hazard. Wood siding may also warp or crack. Common woods include cedar, western pines and redwood.
• Panel siding (such as plywood) is inexpensive and easy to install. Unfortunately, it is relatively unattractive. T1-11 is one of the most common types of plywood.
• Fiber cement looks like wood. It comes pre primed, has no imperfections and will not shrink. It is less expensive and more stable than wood. However, nail holes are more visible, so it is particularly important that all nails are galvanized and countersunk. Like wood, it requires painting.
• Vinyl is a plastic product that typically resembles wood. It is probably the most common siding in new homes. Because it does not require paint, vinyl needs little maintenance, although it does need to be replaced every 20-30 years. It hides scratches and other minor damage well. It is relatively easy to replace and has a high ignition rate, which means that it burns less than half as fast as most woods. It is easy and fast to install.
• Aluminum is similar to vinyl. Over time, however, it requires more maintenance, as it is susceptible to dents and requires repainting. When repainting, it is important to prime the siding with primer specifically for that type of siding.
• Stucco is an attractive, long-lasting siding option. It is expensive, however, and can develop problems over time. It is more common in warmer climates, such as California and Florida

As you can see there are many different types of exterior siding material. The final selection, more times than not, will be determined by region and price.

Exterior House Siding Terms and Definitions

These are the key terms that you will use most often when talking about exterior siding:

• Square = In siding terms, one square is equal to 100 square feet of siding, or a 10′ x 10′ surface area.
• Starter Strip = Vertical base trim that starts the siding from the base.
• J-Channels = Used to trim out the ends of siding panels where they meet a door or window & to cover cut edges of panels around windows and under eaves.
• Solid Soffit = Panels that conceal the eave of the roof that have no ventilation.
• Vented Soffit = Panels that breathe and control moisture and allow for air flow through the eaves.
• Coil = Sheets of aluminum to be bent on sheet metal-brake to wrap doors and windows and all other trim.
• Outside Corner = This is a channel molded into each side of the post to receive the end of the siding, in this case used for all outside corners of house.
• Inside Corner = Same as outside corner, but designed for all inside corner of houses exterior.

Competition is everywhere. Knowing and understanding your competition is crucial. Knowing the benefits they are offering that you are not, what their reputation is compared to yours, and how they are structuring their deals are all things you need to know. By knowing what your competition is doing, it can help you establish an advantage. One of the best things you can do to gain a competitive edge immediately is research your competition. The old saying “keep your friends close and your enemies closer” always rings true in this competitive world of real estate investing. I am constantly on the lookout as to what other investors in my area are doing. If you are new to analyzing your competitors, let me tell you it is pretty easy to do. There are a lot of ways to research your competition. Some of these are:

• • Search the Internet for their search engine rankings
  • Look in the Yellow Pages under real estate services
  • Look for billboards or bandit signs in your area
  • Pick up direct mail from foreclosure properties you purchase

Go to your local REIA and network

Real Estate Investing Tip #1: Study Your Competition

You need to study your competition in order to understand how you can differentiate your marketing and be more appealing to sellers. You are offering a service that people need. And you need to do it in a way that is more attractive to your customers than your competition. Find out what benefits your competitors are offering and then offer better ones. If your competitors aren’t helping people find apartments to move into, you need to make this one of your specialties. If your competition is doing lease backs, then you need to find a better alternative. It is important to find these positive benefits unique to your business that can be easily stated and remembered. That way, when people hear about the benefits or read about them, they always know it is your company.

One of the best ways to find out about what your competition is doing is to ask the sellers that call you and that you meet with. There is no better way to study your competition than going right to the source. Whenever I have a meeting with a seller I always want to know who I am competing with and what they are offering. Many times I have been sitting at the kitchen table with a seller and asked to see what other letters they have received. You will be surprised because most sellers will willingly give you everything that has been mailed to them. I will then take these letters back to my office and read them and compare and contrast what their marketing pieces to what I am sending out. Most of the time I realize how weak most of my competitors are, but there are a few times I have actually gotten a few good ideas from these letters or conversations with these sellers.

Real Estate Investing Tip #2: Know How Your Competitors Structure Deals

Additionally, you always want to know how your competitors are structuring their deals. I have often used this information against them by strengthening my offer. For example, if another investor makes a higher offer “subject to” the existing mortgage, I will let the seller know the risks of subject to deals. If the seller is making a cash offer then I will generally make a higher offer “subject to.” There is nothing wrong with doing this as long as you don’t bad mouth your competition. Bad mouthing your competition is short sighted thinking, as it may get back to them and can only cause trouble.

You should also try and monitor where your competition is spending their marketing money. Investigate and estimate how much money they are spending especially if they are using other forms of marketing you have not yet tried. It is fairly easy to keep tabs on your competitors and you can always use that information to your advantage.

It is important to remember that your customers have options when it comes to buying and selling. Their options are not just your competitors. For instance, a seller in foreclosure has numerous options they can explore. They can:

• List with a real estate agent
• Declare bankruptcy
• Surrender their property to the lender
• Work out a forbearance agreement
• Try to sell it by themselves

Those are only a few of their options. Your goal is to show them and convince them that by working with you it is in their best interest. Your marketing should be convincing enough to get them to at least call you before they explore other options. From there it is up to you to convince them that the other options are not in their best interest.

Real Estate Investing Tip #4: Your Marketing Should Never Stop

Realize that your marketing does not stop at the initial contact. It appears in the way you dress when you show up for the appointment, in the marketing materials you bring to the house, and in the way you present yourself during the meeting. It then carries on to your follow-up marketing if you were not able to put the transaction together in the first meeting. Likewise, after the transaction is complete, your referral network grows and your future marketing is positively affected.

The best way to start preparing your marketing is to make a list of all the options a seller has and then bullet point out some advantages of dealing with you instead of going another route. This way, sellers are compelled to call you because you have shown them you can fix their problem. These will most likely be the biggest benefits you will use in your marketing pieces. These will also be the points you use when handling their objections over the phone or in person.

Real Estate Investing Tip #5: Build Your Foundation

If you avoid some of the pitfalls discussed above and apply the principles mentioned, you should be on your way to building a very strong base for your real estate business. Remember, no business can be structurally sound without a proper foundation built on the quality and frequency of sound marketing.

Social media wasn’t around during the Cold War, of course. But the term “social listening” does conjure the image of marketers in ushankas, huddled around a Twitter feed, like half-frozen Siberian spies parsing transmissions for intel.

Social listening is really just a subset of a larger discipline called “brand monitoring” by big companies and their big expensive agencies. They eavesdrop on the Twittersphere and other online sources, mining traffic for comments about their companies, products and leaders.

Not Just for Big Brands

The good news is that most small businesses can implement some form of brand monitoring or social listening. But to succeed, you’ll need a purpose, a plan and some patience—and a Twitter account to serve as your company’s listening outpost.

So Why Listen?
​
Central to any integrated marketing initiative is being crystal clear about why you’re doing it.

A very good AdAge.com article, summarized below, cites three important but very different strategic reasons for social listening:

• Gathering Intelligence: A passive discovery exercise that seeks to discern brand and/or campaign advocates from naysayers and detractors; the goal is to see who’s saying what and why, and decide how or whether you should respond.
• Improving Service. Establish guidelines for distinguishing legitimate service concerns and applying the appropriate resolution. Take a measured approach; remain helpful, positive and professional. P.S. Don’t feel obliged to apologize for every little thing.
• Taking Action. More challenging but more gratifying. Here, you’re not just monitoring conversations, you’re actively engaging in them, resources at the ready, focused on protecting and advancing your brand.

Be Patient and Persistent

Planning and implementing a social listening program can take many months and man-hours. Ditto for the other critical piece of the social listening puzzle: learning to mine and interpret results.

​But with patience and the right approach, social listening can yield many new competitive advantages, including: deeper customer insights and connections, a more authoritative market presence, and the confidence to guide your brand’s social marketing narrative. And what red-blooded Western marketer wouldn’t say “da” to that?

Flipping a house is becoming incredibly popular again, but for those recently looking to get into real estate investing, it may seem complicated. Those new to the industry may wonder how it works, how it is different from other investment strategies and what its benefits are?

Industry insiders classify flipping a house as buying, renovating and reselling a home.

The extent to which homes are improved can vary widely from ‘prehabbing’ (clearing out and creating a blank slate) to modest cosmetic home improvements like painting and landscaping. Experienced investors may prefer full on remodels with new roofs, additions and kitchens.

Some of the reasons real estate investors choose to flip a house are associated with their preferred investing strategy. These may include: speed of seeing returns, avoiding the risk the of long term holding, capturing larger lump sums of cash in the short term, and because it is a lot of fun and therapeutic.

There is nothing wrong with building a portfolio of rental properties, building new homes, investing in mortgages or most other real estate investing strategies. It is important to determine, whether or not, flipping a house is right for you.

Wholesaling homes, or simply flipping real estate contracts can be profitable as well. However, those addicted to flipping houses prefer that they are able to get in and revitalize communities and create profits in any market.

Flipping a house is a great way for investors to diversify from these other real estate investing strategies while generating wealth. It can increase profits, recapitalize and boost funds for rentals and allow them to flex their creative muscles.

​However, one of the best reasons to make it your initial focus as a new real estate investor is the ease of entry. Without making it sound too good to be true, flipping houses really can be done with little money out of pocket, even with poor credit and for fast profits.

Will rising mortgage interest rates really have an impact on real estate wholesalers?

We all know that interest rates have to go up. We’ve enjoyed sickly sweet low mortgage rates for a long time and while predictions of increases really haven’t become a reality until now, real estate investing pros and the public can’t be fooled into a false sense of security.

Rates recently hit a 12 month high and are expected to keep rising. The markets will demand it, bankers need it and while not all will be pleased about paying more in interest, it will mean higher yields on savings and more fuel for economic growth.

No one expects interest rates to soar out of control in the short term. However, historical cycles suggest that double digit rates could well be on the horizon within the next decade.
For real estate wholesalers this may not seem like much of a concern. After all, most of those flipping houses only use leverage for extremely short periods of time, and if you aren’t holding the debt you won’t be paying interest on it. Plus, access to more loans and easier borrowing is probably a welcome tradeoff for most investors flipping homes.

We are already seeing this with lenders and mortgage brokers becoming the most aggressive we’ve seen in almost a decade. This is especially true of hard money lenders and commercial mortgage brokers offering blanket funding and bridge loans. Just hop on LinkedIn or get on a few lists and you’ll probably be bombarded with lenders looking to make loans today.

With this said, it is still critical for investors and especially wholesalers to remember that rates are a factor when it comes to resale. Higher rates will affect both retail borrowers and buy and hold investors. While this doesn’t mean you will see any dip in volume or interest, you made to moderate prices to compensate for this.

Finally, remember to use this trend in rising rates as motivation to get more buyers to pull the trigger now, and fuel to move more units right away. With these rates, there is still timeto get into the wholesale business.

How can you better guarantee profits and profit margins when flipping houses today?

According to a recent media article, some real estate investors in areas of the country are finding it increasingly difficult to produce anticipated profits after flipping houses. How can you prevent this from happening to you?

Similar situations may not be uncommon today, but that does not indicate a major change in the velocity of the new housing boom or that it’s too late to get into flipping houses.

So how can you avoid falling into that boat, lower risk and enjoy better profit margins when flipping houses in today’s market?

1. Real Estate Education

Investing in your real estate education will have the biggest returns of anything you do and will keep on paying you back into eternity.

2. Lock in Your Profit When You Buy

Don’t speculate. Always buy low and lock in profit upfront. If possible, have it sold already so that you are guaranteed profits before you even write the contract.

3. Be Careful What You Put in

One of the biggest traps in flipping houses today is over improving, under improving or simply investing in the wrong improvements. Know your stuff and what the real returns on them will be.

4. Do Your Due Diligence

Don’t invest without thorough due diligence. Know your values front and back end and recognize you need more tools than just Zillow to accurately assess them.

5. Don’t Allow Appraisal Contingencies

​You might want to include them when making offers to buy homes, but don’t allow them when you sell – that’s so 2001.

Most real estate investors are missing out on the bulk of potential returns due to one major mistake…

Is real estate leverage your most dangerous enemy or best ally?

Fear resulting from the last bubble is neglecting many investors from realizing their full potential and greater returns by snubbing real estate leverage.

Many are afraid to use real estate leverage, as taking on increasing debt is associated with bad business practices. However, not all borrowing is bad. In reality, it’s an investors’ best friend and tool. Used well, real estate leverage can make all the difference in returns, success, lifestyle and ultimately financial freedom. In addition, attracting a private money lender has never been easier.

Paying cash, keeping down debt and refusing to take on overhead can be smart. Subsequently, it can seriously diminish returns, cap growth and permanently cripple top end potential!

Compare paying $800k cash for a property, putting in $150k in repairs and walking away with $50k in profit after flipping the house versus diversification and using leverage.
Consider the interest and returns on that can be compounded again and again over time, adding years of additional returns in a matter of weeks. Plus, this doesn’t even discuss the advantages diversification and leverage has for liability protection and preserving wealth.

​Embrace leverage; reach your full potential!

Have you been looking for more private mortgage money?

Great news is emerging for those real estate investors who having been searching for more capital…

Hard money and transactional lenders have been promoting their services more than ever recently and even conventional mortgage lenders and banks have begun to offer more incentives to borrowers to take out new loans.

Of course some real estate investing pros just prefer private mortgage lenders for the lower interest and fees, speed, control and ease of doing business. If that’s you then thanks to Ben Bernanke and the Fed it could be getting a lot easier for you this week.

Bloomberg reported this week that mortgage REITs are losing money, losing investors and losing returns in response to the Federal Reserve plan to buy up mortgage debt and the number of homeowners refinancing thanks to low mortgage rates and the $25 billion mortgage settlement.

Investing in mortgages may still be a great investment but giant REITs are bleeding investors due to a drop in returns and are showing investors how investing in publicly traded stocks is incredibly risky and volatile compared to direct investment in real estate, mortgage notes or private partnerships.

It doesn’t matter if you are up 99% in a day if you can lose it all tomorrow. Fortunately this isn’t an issue private lenders need to worry about with investing directly in mortgage notes or flipping houses for that matter.

According to the Bloomberg report annual dividend yields on these big home loan REITs have been around 13%. That’s not bad, and at least far out beats the S&P 500 performance.
Maybe you don’t want to giveaway those types of returns but at least you as a real estate investor can offer a much better investment vehicle which will be safer and more consistent.

​Strike on this opportunity and close more private lenders. Don’t just build great presentation materials showing the strength and track record of what you are offering but contrast it with the downside of investing elsewhere too.