real estate investment

Want to Be a Successful Real Estate Investor? What You Need to Do

By Amon Minor

Are you looking to make money through real estate investing? If you are, you are not alone. However, real estate investing is a tricky business. There are some real estate investors who are successful, while others are not. If you are interested in becoming a successful, profitable real estate investor, you will want to make sure that you know exactly what you are doing, when buying real estate investment properties. That is why it is advised that you do your on research or signup to take a real estate investment course or class.

When it comes to taking the time to thoroughly examine real estate investing, there are many hopeful real estate investors who wonder why they should bother. Many assume that buying real estate properties, fixing them up and then renting or selling them isn’t a complicated process, but there is more to being a real estate investor than just putting a purchase offer on a property and doing a few repairs. By taking the time to actually learn about real estate investing, you are more likely to become a successful real estate investor.

One of the reasons why research increases your chances of seeing success and profits is because there are many real estate investing tips out there, just waiting to be found and used. What many do not realize that is many real estate investing tips, which include both dos and don’ts, are composed by successful real estate investors; those who have seen profits themselves. Getting your information from a successful, proven real estate investor is your best chance of success. This is because the information or tips that they give you are relevant, as they have often tried them out first hand. For that reason, you may want to look for real estate books or real estate courses that are written or being hosted by successful real estate investors.

Some of the many tips covered in many real estate investing books and real estate investing courses include tips on buying the bests properties, as well as how to make those properties rentable or sellable. As a real estate investor, you have the decision to fix up a purchased property and then resell it or become a landlord. Many real estate courses and books cover both real estate investment approaches, as well as outline the chances of success with each. As a real estate investor, you are your own boss; therefore, you are able to make your own decision, as to what type of investing you would like to do, but seeing information on past investors and their success may give you good ideas; ideas that could help you become a successful real estate investor.

In short, if you are serious about becoming a real estate investor, you will want to take a real estate investment course or purchase a collection of your own real estate investing books. When it comes to becoming a successful real estate investor, research cannot be emphasized on enough.

Amon Minor is a writer for Fastcashinrealestateforeclosures . com where you can find accurate information about Real Estate Investor and other related information.

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real estate investment

Investing In Real Estate Investors

By John Roush

With the never-ending changes in our Real Estate Markets real estate professionals are starting to pay attention to the sound of new commission streams of income. Some realtors have either shied away or ran-away from such terms as “Cap Rate,” & “Cash-on-Cash Returns.” Terms that only the ‘smart’ and ‘numbers-oriented people use to determine if a Real Estate purchase is a “Good Deal”, or not. A majority of the realtor brethren attended real estate school because they are excited and passionate about the promise of selling real estate and making a fantastic living. That being said “Times are a Changing.” Even if you live in a Hot Market where residential real estate sells in 2-3 days there is an old approach to real estate that is growing faster by the day…..Residential Real Estate Investors.

This deft group of real estate investors is taking real estate and the real estate investment world into a new era! No longer accepting the crazy volatility of the Dow Jones and NASDAQ families. Unwilling to accept the investment practices of their fore-fathers these Investors throw caution to the wind for returns above the traditional 5-6% in their Roth or IRA accounts. These Investors are bold and oftentimes aggressive. Today’s Real Estate Investors are all about the fast fix-n-flip, high appreciation, and rock solid monthly cash-flows. Cutting their teeth on investment in their own home-towns is only the beginning as the Serious Investors turn to points outside their own back-yards to other regions that demonstrate greater promise and higher returns. You may say well how does this older adult view their investment opportunities? For starters the age of these stealth hunters ranges from 28 to 68. From “Rich Dad-Poor Dad” book series to Trumps magical presence on “The Apprentice,” the young real estate entrepreneurs are making their dreams happen to the tune of 3-5 acquisitions a year! Got your attention now? The typical Investor has good to great credit scores. Excellent cash reserves or hidden resources of partners with cash, and a willingness to make the deal happen at nearly any cost. The best kept secret of all is that these investing beasts travel in packs. Where you see one another is very close behind. In other words they know the people that you need to know to grow your investor database even larger. If the real estate professional does a good job the happy clients are likely to refer many of their fellow-investors. Not just investor clients but their regular every-day real estate business. Face it, if you can demonstrate to your clients how adept you are with their largest personal purchase of real estate, then wouldn’t you suppose they will be over their “trusted real estate advisors” opinion on buying a basic home, condo or beach house?

So what if you haven’t been focused in the real estate investment sector. And you are thinking this all sounds pretty good, let’s give it a try. First question to ask yourself is who have your clients been working with or exploring their options of real estate investing with over the past 3-4 months. Statistically 6 out of 10 clients have considered investing in real estate or have already begun doing so before their realtor even has a chance to blink an eye. Got your attention now? How about the fact that in less than one year I increased my annual commissions by 30% by just positioning myself within my primary data-base of clients. All I did was let them know that I was ready, willing and able to begin assisting them with their “Investment Realty” needs. What I learned during the first year was that if I could create an environment for my clients to learn more about real estate investing that they would thank me in a variety of ways….Most importantly they would call me before writing a contract and would make sure that I was involved in every contract that wanted to make a real estate purchase. Before long 30% went up to 45% and further. Even if you aren’t interested in expanding your client database, at least consider protecting the turf you have for so long spent tireless amounts of time and financial resources to maintain their allegiance. On the other hand if you are looking at your real estate career and are wondering how to reposition yourself for market growth certainly to go well into 2025, here are a few known facts about how real estate investors can improve your business.

1. Real Estate Investors are literally everywhere. Successfully tapping into your current database could increase your annual commissions by 20-30%.

2. Real Estate Investors will be loyal to the professional that helps fill the gap of their investment education. Workshops, mentoring groups, finding the “golden deals” in your market makes a huge impact!

3. Investing in Real Estate Investors doesn’t have to mean that you lose your “typical” residential realtor position. Being a real estate investment specialist means you are smarter than the average realtor in the market.

4. Mortgage professionals are struggling to provide real estate investors with property deals, so when you can place an investor into a good deal the referrals will begin to flow even more.

5. Real Estate Investors tend to be more conscientious about your personal time away. Investors also like to shop Monday-Friday for their deals before the “Weekend Warrior” investors get out into the competition. This translates into more normal hours and days of operation for you and your business.

6. Real Estate Investors buy-sell cycles are shorter than primary home purchasers resulting in more transactions in shorter time-frames.

If any of these points are encouraging you to seek new options in your business then make sure to sign up for the monthly “Grow your Real Estate Investment business” e-mail newsletter from http://www.InvestorLoft.com additionally, other excellent tools to improve and expand your real estate business can be explored at the InvestorLoft’s educational Shoppe.

By John E. Roush, Broker-Owner Atrium Real Estate Investments. John is a full-time real estate agent specializing in real estate investment and real estate investment education. To contact John send all correspondence to Johnr@investorloft.com

©2005 http://www.investorloft.com

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real estate investment

Who Can Act As The Qualified Intermediary For Your 1031 Exchange?

So you have finally decided that you want to sell an investment property and pick up another. You already know that there are taxes that are typically due within the tax year that you sell the property. But what if you would simply rather take that tax money and reinvest it into the same type or kind of investment property or something even better? Can you actually do that? Yes, with the 1031 you can but there are many laws and guidelines that will have to be strictly followed in order to make sure that it goes through okay.

The first thing you need to realize is that you might need a little help understand all of the rules and the timeframes that you will be looking at. You can hire a real estate attorney or simply ask the qualified intermediary to help. Since you have no choice but to hire a qualified intermediary, you might as well take full advantage of their services and see what all you can learn from them. You cannot complete a 1031 exchange without a 1031 exchange company so it is important to make sure that you are not forgetting about that step. But just what exactly does the qualified intermediary or the 1031 exchange companies do for you?

The intermediary is also referred to as a accommodator or a facilitator. This is a person, or in most cases a company, that acts as a neutral third party in the real estate transactions. This person or 1031 exchange company will enter into a written agreement with you regarding the exchange. They will acquire and then transfer the property that you are selling. Then they will acquire and then transfer to you the replacement property that you are taking on. It may seem overly complicated but it really is not. Once you get started with the process you will see how easily it all comes together.

The agreement will also explain that you are not in any way allowed access to the proceeds from the property you sell. Since you will not be paying taxes on those proceeds right now and they are to be used specifically for a replacement property, there really is no need having access to the money. The qualified intermediary holds onto the money for you. They are basically the “go-between” for your real estate investment transactions. They will hold onto the proceeds and use them when the time comes for the purchase of your new replacement property or properties.

You might also be interested to know that the fees for using a 1031 exchange company will vary. Typically though, you are looking at about five hundred dollars for the first time you use the qualified intermediary. In most cases, this fee amount will decrease each time you have to use them for the purpose of a section 1031 exchange.

It is also important to make sure that you are making sure that the right wording is contained within you contract with the 1031 exchange companies that you use. If you are worried about this part, you might want to have an experienced real estate attorney take a look at the contract to make sure that everything reads how it should. You just never know when something is going to come up so you want to make sure that you are being proactive and preventing problems from even taking place.

Once you have found the 1031 exchange company that you are going to use, it is important to make sure that you are researching the various rules and guidelines yourself. Even if you have a real estate attorney and an exchange company helping you out, you are responsible for making sure that you are staying within the guidelines set forth by the IRS and that you are getting all of the tax advantages that you should be getting.

The most important thing to pay attention to is the time frames given for the 1031 exchange. For example, you only have forty five days from the date you sell your property to submit, in writing to the qualified intermediary, the information on the replacement property or properties that you are looking to purchase. This forty five day mark is exact and there are no exceptions to the rule. Then you only have a total of one hundred and eighty days from the sale of your property to completely purchase and complete the transaction of the new property or properties that you are taking on.

As you can easily se, one slip up or one overlooked thing can cause you to miss out on the advantages of the 1031 exchange. So make sure that you are reviewing the website of the IRS, consulting with a real estate tax attorney selecting a qualified 1031 exchange company. By taking all of the right steps you will find that you are able to grow your real estate wealth quicker than you ever thought you could before. Why pay on those taxes now when you can get them deferred and use that money more wisely, such as investing in bigger and better real estate?

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real estate investment

The IRS Definition of an Exchange

If you have ever stumbled upon http://www.IRS.gov you have probably seen that there is a wealth of information on there. Some people find the site hard to navigate or simply find that some of the information is a little difficult to understand. If you are someone that is interested in real estate investments, it is vital that you make sure that you are fully aware of all the laws, restrictions and taxes that you have to face.

Of course, you already know that you have to pay taxes on the properties that you sell, but what about if you are exchanging a property or two? Believe it or not, there is an exchange program set up through the IRS that allows a person to take the proceeds from the sale of a property and invest it into a new investment property that is equal to or greater than the fair market value of the property that sold.

Section 1031 is where you want to focus for such benefits. The 1031 tax exchange is fairly simple to complete but there are a few things that you have to know in order to make sure that it is something that you are going to be able to take full advantage of. The IRS definition of this exchange is the exchange of qualified properties, which will defer the capital losses or gains that would typically be due upon the sale. There are two basic types of exchanges under the 1031 tax exchange regulations. There is the simultaneous exchange and then there is the delayed exchange.

The delayed exchange does seem to be the more typically used but the simultaneous exchange does have its place. The simultaneous exchange is where a property is accepted as “payment” from someone purchasing his or her property, in lieu of a cash payment. There are still value rules that have to be adhered to which are clearly defined on the IRS website. Typically though, real estate investors who are selling their property are not dealing with someone who has a property that they want to take on.

The delayed exchange is perfect for these cases. The investor can sell his or her property and then shop for another, from a third party. The investor has forty five days from the date of the sale to identify the property that he or she is interested in purchasing and using for the section 1031 exchange. To identify the property, the investor must submit his or her intentions to the Qualified Intermediary in writing. It is important to note that the forty five days does include weekends and holidays. If you miss the deadline, you miss out on the tax deferment. There are no exceptions granted under the 1031 tax exchange rules.

But the forty five day timeline is not the only timeline you face. Once you identify the property or properties that you want to purchase in the exchange, you have only one hundred and eighty days from the sale of your property to purchase the new ones. It is a good thing that you are allowed to identify up to three properties of interest since the timeline is so strict. Even if you are only interested in taking on one additional real estate investment property, you will have options if something falls through. If the property you identified falls through and you are not able to purchase it, then you are not able to take part in the 1031 exchange if your forty five day period is up. If you identified more than one property during that time frame, you will be able to simply try to purchase another one from your list. This means that you should have no problem taking full advantage of the tax deferment benefits that come from the section 1031 exchange.

It is also important to know that the Qualified Intermediary holds on to the proceeds from the property you sold until it is transferred over to purchase the new property or properties. You also have to make sure that the property or properties that you take on are of equal fair market value of the property that you sold. They can also be worth more than the property you sold, they just cannot be worth less, otherwise, and they will not qualify for the section 1031 exchange.

When dealing with the 1031 tax exchange for the first time, you might want to look around for a little outside help. The last thing you want to do is to miss out on the tax deferment. Having to pay on your capital gains now could mess up the plans you have to reinvest into some more investment properties. The more money you have to purchase new properties, the larger and quicker your overall wealth will grow. Sure, you will pay taxes when the time is right, but for right now, you can take advantage of section 1031 and build upon your wealth.

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real estate investment

What Is A “Starker” Exchange And How Did It Get It’s Name?

Many people already know that there is a lot of money to be made in real estate investments. The thing is though, many people are a little shy about getting involved because of the amount of money that is required. Not only does a person have to have a little chunk of money to use as their start up, but there are also a lot of tax issues to deal with. Luckily, though, there is the starker exchange that can save you a lot of time, frustration and money. If you are planning to begin a real estate investing career, it is important to make sure that you are familiarizing yourself with the starker exchange so that you can make the most out of your investments.

Many people have heard about some tax breaks or deferments when selling and purchasing investment properties, but do not clearly understand how it all works. What most people would be referring to would be the 1031 starker exchange. This is not something that automatically happens for people. You have to qualify for the starker 1031 exchange as clearly stated on http://www.IRS.gov and make sure that you are meeting deadline qualifications.

If you want a brief understanding of how the exchange works, it is rather simple. There are two basic types of property exchanges, one that is immediate and one that is delayed. The delayed exchange, otherwise known as the starker exchange, is what most people look to take advantage of just because of convenience most times. The “starker” name came from the court case that established the rules and laws regarding this delayed exchange. It was in this court case that it was decided and a Qualified Intermediary has to be used which does come at a price. It is generally around five hundred dollars or less for the first time you have to use the Qualified Intermediary and less than that for each time thereafter.

But what is the purchase of the Qualified Intermediary? This is the person or company used to hold the proceeds of a sale until the seller takes possession of new property. It is an escrow account basically. This ensures that the proceeds from the sale of the property are truly being used towards the purchase of another real estate investment property and not something else. If the seller ay any point takes possession of any of the proceeds, the status of the tax deferral is then disallowed.

It is very important to note that there are very strict rules and guidelines that come with the 1031 starker exchange. Once you sell your property you have exactly forty five days to notify the Qualified Intermediary of the property that it is being exchanged for. This notification must be done in writing and it cannot happen after that forty five days. If too much time passes, you will find that you are no longer qualified for the 1031 starker exchange. There is no going back, no matter what the reason was for becoming late identifying or purchasing the new property or properties.

You also want to note that these forty five days includes holidays and weekends. So if your forty five days ends on a Saturday, you are not given until that following Monday. There are no exceptions or chances to bend the rules. And the forty five days rule is not the only timeline you will face when dealing with a starker exchange.

You actually only have one hundred and eighty days from the sale of the property you relinquished to completely purchase the replacement properties. If you run a hundred and ninety days, you are disqualified for the starker exchange on that set of properties. This means that you are faced with the taxes that you were trying to defer in the first place.

Another quick tip that might help you out is that your replacement for the property you sold can actually be more than one property. You just have to make sure that combined, they equal the value of the property you sold, if not more. There is the three property rule though which states that you can only identify up to three placement investment properties for the purpose of the exchange. For those who only want to purchase one, you still might want to identify at least two properties during that first forty five day deadline. This way, if the purchase of one property falls through the cracks, you will not be left empty handed and without a change at the 1031 starker exchange.

These guidelines are clearly laid out on the government’s website. Simply look into the Starker exchange and you will find all of the guidelines, rules and timelines laid out for you. All you have to do is do a little bit of research and you will find all of the information you need. Just make sure that you are learning everything there is to know about the 1031 starker before you sell that first property. Since you will be faced with strict timelines, you want to make sure that you are not wasting any time. Read everything you can on the starker exchange and consult a real estate attorney if you have to. After going through the process once, you should have no problems doing it again with little help.

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