So, you?ve decided to take a more proactive approach to your investing, and have decided to start investing in real estate, or have decided to invest in a business. While the long-term potential is much greater than that of the more traditional investments (stocks, bonds, mutual funds, money markets, etc?), there are also some pitfalls for the unwary investor. Some critical questions you need to ask now are: ?How do I protect myself if the investment fails??, ?How do I reduce my tax liability??, ?How do I manage my investment??, ?How do I bring other people into the enterprise??, and ?How do I transfer my investment when I?m ready to dispose of it??. The answers to these questions will outline the goals for your business, and will be largely determined by the form of business entity you choose for your new investment. In this article we will briefly examine some of the more common forms available.
By Gary Geist, HomeReplay, LLC.
Once you find what looks to be a good real estate investment, you need to quickly determine several key aspects of the deal. This would include:
In today's fast changing real estate market with the unprecedented number of foreclosed properties, it's a challenge just to know how much to pay for a piece of property. I know there are a lot of experts and real estate agents who say you need to hire a professional to give you an appraisal or competitive market analysis (CMA) of the property before you buy; but my question is who is more committed to determining the true value of the property than you the investor? No one is!
How do you as a new investor take advantage of the current number of foreclosures and purchase a bank-owned or REO property? As the number of foreclosures continues to rise, more and more distressed properties will be available for investors who are prepared to buy these properties. Of course, the most obvious method for purchasing one of these properties is to spend cash, lots of cash. Then hold these properties as rentals, receiving a positive monthly cash flow until the market turns around and then sell off for a profit to new home owners.