Some Pros and Cons of Buying Property Next to a School

The biggest challenge can be finding the best place to live.  Some people are specified about neighborhood, looks around and the new area. If you are that type of a person who has some specified criteria about surrounding than I have a solution for you to find place for your living. Living next to a school would be the best choice. Specially if you have kids. You may find some best possibilities finding property next to school, if your kids are school going, college students, and deal breakers. Let me show you some pros and cons of buying property next to a school.


First have a look on some pros:

Affordable.
You may find affordable living places near school and colleges. You might think why the places near to school, colleges and universities are low in cost. I can answer your question, it is just because near to places like school and college students used to live. They want some affordable places which must be low in cost. You can easily find place to live nearby schools and colleges at very low cost. If you want to cut down your expenses and planning to save some money for future this is the best decision you can take on for living and cutting down.It might be more affordable as compare to finding home somewhere else.

Close to playground.
The incredible thing you can have when you choose your home near by school is playground. Choosing home near to school will amaze you with some enjoyable things, one can be a playground. You can go out with your kids in every evening or whenever you urge for a trip. This would be very convenient and trouble-free for you as you do not need to pack your bags and make a drive for some wanderlust. You may enjoy there in every evening and your all stress and tension can vanish away. The other ease would be you might be able to send your kids alone to play. At the same time, you can keep a safeguard eye on your kids. Even you can go on morning walk every day and do exercise. You can enjoy good health and nature at the same time.

Increased the value of property.
Buyers have some eager interest in buying homes near to schools and colleges. The reason is they can easily rent out these homes and can enjoy some plentiful profit. The other point is they can easily resale it at good amount. Eventually for these reasons your property’s value get increases day by day.

Now it is time to have a look on some cons.

Traffic noise.
You would have been bothered by traffic noise.The two timings of school that is morning and closing time school can make a lot of noise and disturbance. You may run into jampacked roads which can bother you. The inflow of the traffic may be very high depending upon the size of the school. But the tension is for only morning and closing time. Else time would be easy and peaceful.

Noisy neighbor.

I can say it is good but not so good. I am talking about the noise of kids. The area surrounded by kids cause a lot of noise that may bother you. The chirping of kids may sound sweet and cherish able but at the same time cause noise and disturbance. This place is not for you if you are suffering some kind of illness honestly.

Time for decision making.

You are your own boss in taking decisions. It is an entire your decision what you want to choose. All these pros and cons may help you in making decision whether tobuy or rent out the home or not near to a school.

The Three Major Benefits of a Highly Organized Land Lording Business

The major question is why organization plays a vital role in real estate business.
Here are the three major reasons to clarify:

Freedom and peace like a Calm Lake.
Everyone wants his mind should relax like a clam lake. No one wants to get into any dilemma at work. Relaxation at work is one of the biggest tool your mind wants to grab. No one wants to come across any tension.Yes, its freedom at work you want to avail. You want freedom at your work place. You want peace of mind like a calm lake. Being organized is a key to avail peace of mind like a calm lake. It is not just about rules and regulations it is something beyond it that is none other, but peace of mind and freedom at work place. When you are having a still mind like a calm lake you are able to enjoy your work. Eventually the key is being organized for having enjoyable work and peace like a calm lake. Planning and placing is behind minimizing your stress level and being organized.


When you organized and plan your work you can easily manage:
Have the bill payed yet?
How much money is bringing in by rental?
Did I need to call my tenant back ever?
You would not need to take any tension about such type of questions.

Simply being organized is the incredible thing that can vanished away all your worries. It can bring peace of mind and you can enjoy peacefulness like a calm lake. The purpose of this blog is to emphasize on being organized which is getting things done. Here I want to you that your goal must be to organize your property management system. You must use computerize system for filing properly, use software and spreadsheet for your property. Only in that manner you can organize your work properly and enjoy ample of peace and your mind would be like a calm lake.

Legalize.

The other significant point is to legalize your organization. It will help you out in minimizing your stress level and maintaining your peace of mind. The internal revenue service requires some important and accurate information. The compulsory thing is to report accurate facts and figures regarding expenses and income that is occurring during a period.This is the most vital point that you have keep into your head to record each and every expense and income. You may think these things are insignificant but to legalize and record everything will blow away your stress. I must tell you that to record accurate reports on your property and to manage it internal revenue service is very important. Legalizing is simple to record every fact and figure about each and every expense and income.

Profit.

Profit is a word everyone knows and want to grab. Ultimately, organizing is all about profit. Being planned and organized can make your organization able to earn more profit. When you organize your property expenses and incomes you can able to understand from where all the incomes are coming in and where all the expensesare going out. You can able to take accurate actions for lowering down your expenses and able to get significant points that would be, what should have done next to earn more profit. The whole picture of your business is now transparent to you which is very important.

Keep in mind the three points when you embark to set up your business. Are you close to your goals by the actions you are taking in your business? Are you able to improve them? Can you able to differentiate your hobby and your goal? Always try to improve and being organized will help you out regarding this. When you set up the perfect system by organizing you can then enjoy your work and profit.

Four Important Tips for Tapping into the Lucrative Niche of Student Housing

You want some lucrative investment then student housing would be the best option. If youthink about the investment point of view, investment near universities and colleges would be very fruitful. I have some experiences in my life through which I can assure you real estate investment can be lucrative near student housing.


Keep in mind one point, investment near student housing would not be as easy as you may think. It may come up to with different type of hurdles and barriers you must before jumping into it. Although it is very profitable investment. You may not disappoint by investing near student housing. Only the key is you may aware of some unforeseen dangers coming in your way.

Some of the steps you should follow if you want to make an investment in student housing.

Your first priority should be to pick up a non-commuter school or university.

The most important and first thing you think upon is to choose the school or university with large number of students. The universities which also work with other small universities. The larger number of students will able to make you earn more profit. That would be your first priority. Make sure you do not pick a commuter college or university. That would be a plus for your real estate investment.If you pick a commuter college or university for real estate investment the number of students may be very low. Students of commuter colleges do not choose to live nearby colleges or universities. They are daily scholars and they do not rent out homes for living. They daily go back to their own homes.So, the thing is very obvious the commuter students do not have any commitments for living nearby schools and universities. Then it does not make any sense for investing in student housing near commuter colleges and universities.If you are not thinking about student housing investment then these areas can be best fit for your real estate investment. The universities with large number of students are having full time students so, they commit to live nearby.

I give you an example UMKC university. This university is having more than 17000 students. Some of the students are full time students and some are part time students. Night shift classes are also happening in this university. Some of the students are taking night classes and would not able to go back home timely. So, they use to live nearby. They rent out homes and this is the best place for your student housing investment niche.

Now the main point is you have to discover the campus is overbuilt or commuter. The best and only way is to find out the solution is to visit that area. Talk to the people living nearby. Go to the local property brokers and talk to them, ask them about campuses are overbuilt or commuters.

Seek out the right zone.
You should make zones according to the student’s need.
There may be different zones: Zone 1 can be for the students who want their homes at walking distance.
Zone 2 can be for the students who have bikes to ride.
Zone 3 can be for the students who have their own cars to drive and can easily reach home if that is at some distant.

Rent out as per bedroom.
The best part of renting out the homes to students would be you may not need to rent out the whole house. Rent out the bedrooms you have in the house. The more bedrooms you have to more you can earn the profit. Students usually don’t seek the whole house. They have limited money to expense out and choose a bedroom over the whole house. This would be beneficial for you. You can double your price. For example, you have 3-bedroom set. You rent out per bedroom for $600 and can earn $1800 per month. And if you rent out the whole house you only able to earn $1200 per month. The profit is now very obvious to you.

Student housing is one of the best way to earn more profit by investing in real estate. You only have to be smart and take the right decision.

Growing your 401k VS Liquidating it for Real Estate investment

What is most profitable.
The question is if you are having 401k you should liquidate it to start investing in real estate or not.

You heard from the older folks and some financial advisor to invest it. It would be the best decision according to them. On the other hand, the younger folks want to pursue early financial freedom and dubious of this advice. They may be right so.


The young folks think that they are in their 20s now and they pursue their financial freedom, there is more likely a chance that they will be financially strong at the age of 60. However, the amount you are having 401k doesn’t matter. As a young man I agree with the young folks but at the same time I totally want to take advice of the elders on.To figure out solution,I did an analysis which will give you a sense and you able to explore other options as well.

The first part of the article will give you the analysis: if you invest 401k at the age of 25 what would be your return. You will come across some better option to liquidate the 401k. So, do not take decision at first glance. To explore some other options stick to this article till end. I did this analysis just because I want self financially independent.

Presupposition.

  • Age:25 years old
  • 401k Balance at Year 0:$15,000
  • 401k Return:7% assumes 401k is held in stocks, bonds, mutual funds, etc.
  • Income Tax Rate:30%
  • Capital Gains Tax Rate:15%
  • Withdrawal Penalty:10%
  • Annual Contribution to 401k:$3,000 pre-tax
  • Annual Contribution to Other Liquidated 401k Investments:$2,100 because you save 30% less after the assumed 30% tax
  • Tax Savings from Reducing Income by Contributing to 401k:invested and earning 7.0% annual

Final analysis.
At the age of 25, you are probably taking your first steps in your journey towards financial independence. Age 60 is likely to be very far away, so you are likely tempted to take that out now and use it to accelerate your journey towards financial independence.

If you invest 401k at the age of 25, you will receive at the age of 60 an amount of $489,545.35.

Formula.

You can do your own calculations with the formula:

(Investment balance * tax rate) + w2 savings – tax paid on gains.

With this formula annual return would be 8.50000% at the investment of 401k.

Calculations would be (investment balance- annual contribution) * capital gains tax. For the rate of return 8.50000%

You have to keep in mind the assumptions I have mentioned above, at the age of 25 you invest 401k the annual return would be 8.50%.

Now it is time for 2nd opinion. Some other things to ponder including your reserves, as well as some other creative ways to enjoy high rate of return.

Best of both options.

In the above analysis, I assume that the amount of 401k is handled by a financial advisor. it is diversified amongst an excessive amount of mutual funds, index funds, bonds, stocks, etc. that will give a return of 7%. The analysis clearly suggests that despite of the tax-deferred earnings, there is a high chance that you can avail a better annual return on liquidation of 401k (8.50%+) by investing it on your own.

The other options for you would be to liquidate your 401k to a self-directed inter revenue agencies or a solo investment to take financial freedom. On these accounts you can almost invest in anything.Also, you can go with the real estate business. The best way to use your 401k is to go self-directed or take a loan against the funds and invest in real estate. This all depends upon your personal goals.

 

Real Estate Strategies to Consider in a Financial Freedom Plan

Everyone wants to be independent, and while there are some ways to get there, the best way s real estate.  It is one of the most lucrative ventures, but the thing is financial freedom is different from everyone.  For some, it might mean a good job that earns more money than they need, allowing them to buy better items as a result. For other people, it is being able to live without debt bothering them, giving them a peace of mind.  Some want a number to be that, a nest egg that they desire so that they can live the rest of their lives without money running out.  But, there are those who believe passive income they cant’ outlive is the answer, and they let their money work for them without putting in the hours.

You’ll need to take on the financial freedom that is based off what you can buy in terms of houses in a given year, and how many you should buy annually. If your goal is the dream lifestyle, you’ll need to work out what this would cost, if you’re looking to replace an income, the freedom number is a pre-taxed income, and then you can calculate how many properties that you’ll need to achieve this, and it’s dependant on the investment strategy that you’ll use.


To make a good strategy, is a good thing and you should know that there are many different strategies to get financial independence, and you can do this in the short-term, as in the case of flipping houses, but there are others that work better, and we’ll talk about what those are.

First is cash flow through properties, which is rentals basically.  You need to look at the freedom number based on the relation of the rental property. For example, if you want to do 60K in a year, you need to have 5K a month, and if it does earn you 500 a month after expenses, that means you need 109 properties to do this.

Then there is buying the property outright, but there’s no mortgage or interest.  You purchase properties, appreciate in value, and determine what you sell off and what you keep, and from there, you can rent out, renovate, and update.

You can also live off sales profits, which is purchasing a home, and while your focus is how much they don’t bring at the moment, it doesn’t matter. The idea is to let them grow in value so that when you retire, you sell them off and live that.  you’ll need to plan how much property you need to purchase though.

Then there is living off equity, which is similar to the last one, but instead of selling to get the funds, you borrow an equity loan against the current one that you have, so you rent them out, and the more you amass, the more rent that trickles in, growing the equity, and from there, if you borrow against, you can live off this.

Finally, there is owner financing, where you charge the buyers and interest over the course of a period.  It has shower payment period s than your normal mortgage, but with higher interests, so instead of selling off properties, you get to enjoy the accrued interest that’s there.

The best thing to do is to figure out what works for you, whether it be one singular one, or a combination of both of these strategies. Whatever it might be, you should make sure that you’ve got the freedom number as the guiding light for this, since this will show you how many properties you can live off each year.

 

Ways to Prevent Fraud and Employee Theft in Real Estate.

One of the biggest things that you’ll want to worry about is preventing from others stealing from you.  You may not even realize it until it’s too late, and then when you look at the transactions, you find out they’re stealing from your business, embezzling a lot of money.  This is more common than you’d think, and with smaller business, you’re more at risk, with 55% of embezzlement happening with 100 or fewer employees, and up to $1.3 million being taken, which is a lot of money.


Accounting is normally overlooked by many, but it’s super important, and if you maintain the proper internal controls for everything, you’ll be able to grow and prevent against fraud.  You should initially look out for any pressure on financial issues on your employees, and make sure that you prevent it. Make sure there are no rationalization, or reason why, and no opportunities, or chances for embezzlement.  These three factors are a big part, and here, we’ll talk about ways to prevent this from happening in your business.

First, separate the duties, especially by making sure you don’t have the same person working on accounts both receivable and payable, and making sure that you don’t have the same person preparing and auditing the books.  This might be unavoidable at first, but later on separate them as much as you can, since this prevents embezzlement.  For small businesses that can’t do this, sharing it can mitigate the risk.

Then there is access control, controlling who uses this. Make sure that you have everything password protected, and keep time-sensitive financial paperwork under lock and key. You don’t need to give this to just anyone.

You should also physically audit the accounts, and that’s counting inventory and cash to make sure that everything is there. Never have loose cash hanging around, and point it right away, but you may need to keep items in inventory, and if you do, always perform audits.  The occurrence of things being stolen to sell off isn’t uncommon, so definitely consider this.

The more you standardize your documents, the better, and you should make sure that you have everything standardized, whether it be paint colors, invoices, expenses, and timecard.  While this might not be related to fraud, having contractors submitting their bid in a work form is good because it will make sure everything is there, and it prevents unbidded items from happening, messing up the price and trying to compare on each project.  You should make sure that you have all documents looking the same, so that it prevents fraud from happening, and allows for you to review the records if things go overlooked.

Trial balances are good too.  Double-entry booking is good and making sure that you calculate the daily or weekly rial balances can give you insight on the system, and your business, preventing any discrepancies from happening as early as possible.

You should engage in period reconciliations, which means that you’re reconciling the accounts regularly to make sure that balances match the deposits and withdrawals on the bank statements and making sure all irregularities are covered, since finding these is often how fraud is discovered.

Finally, make sure you have approval authority on huge purchases, and you should have that on rehabs and turnovers over a certain amount, and you should look at all of the checks that go out before signing them, and you should always have approval authority before beginning with anything.

By taking these rightful measures, you can safeguard against larger transactions, and stop the worst types of fraud.  And while your business might not be able to put all of these safeguards in immediately, you should think about this immediately whenever you hire employees, and you should make sure that you think about anyone who can steal from you, and make sure to keep this as low as you can.

How to create Asset Protection

Real estate asset protection is what the rich real estate investors do. They don’t take the same risks, but instead, they use the law to ensure maximum advantage. It’s not sleazy, but instead, it’s using the rules that are available to ensure that you get the most advantageous situations. Here, you’ll learn how to create the best leverage in a lawsuit, and how to protect yourself.


Many people don’t realize that there is a tool that is not used, which is a contract that will favor you if a deal goes sour and litigation may happen. We don’t want that to happen because it is expensive, but instead, we form a contract that gives insane amounts of leverage to settle a lawsuit quickly. The way for you to protect yourself in the event of any lawsuit, whether you’re the one suing or you’re being sued, is an LLC. These are what will protect you, and we’ll tell you how.

First, you should make sure any remedies are in the document. This prevents you from having to use complicated legal remedies. If you’re buying the real estate, and it goes bad, do you want the property or the money. If you want to get the property, you should make sure there is a “specific performance” clause there. Otherwise, you’re left with the suit for damages and money, and you have to prove the damages.

Unless you were getting a lot on the property through the way you show this is liquidated damages, which is a clause that states that the number of damages in the case of the breach of the contract, especially if the other side backs out. For example, you could say in this that if the seller refuses to execute this sale after the buyer gets financing, then the seller is liable for the liquidated damages up to $40,000. This should be one-sided so that the buyer is the only one with rights, and you can get more leverage over the seller since they have more to lose. Many may balk at this, but you can counter with this by asking them if they have any intention in backing out of this deal after you’ve put all this money into it. This clause will ensure that they won’t, and it gives you much more confidence if they know that you’re serious. It also opens the door to negotiation about what amount of damages are agreed upon between the two of you. If litigation does happen, it will really help the attorney.

Remember that every time you feel a deal is about to go bad, be prepared for lawsuit. Even if you don’t believe anyone will sue you, an LLC is used for protection. You may not be sued either, but you may have to sue someone, and you put yourself at risk. In the US, the prevailing party will get attorney fees, and you’d be surprised that the damages could be only a dollar, but since the other side did prevail, they could get up to 30K in attorney fees, so it can bite you.

The LLC is essentially the plaintiff instead of you. Since the LLC is the plaintiff, they get the attorney fees and damages, and they only look at the LLC. The cost for a new LLC is much cheaper than paying off a judgment, and remember that if a judgment is filed against you, it does appear on the credit report, thereby harming the score, so in essence you’re in the borrowing business to leverage the dollars with the bank, and if done in a personal sense it does hurt us.

You shouldn’t ever really do anything without having an LLC. The LLC is a way to help protect your assets in business dealings. You should only sue if it’s a last resort, and you can only sue if you’ve interacted with someone, so if you want to insulate yourself from lawsuits, you have to act like a business, and by creating an LLC that has little to no assets, it creates a shell. Since the LLC is made of the communications and the contracts, that’s the only entity people will go after. So if a lawsuit does happen, the worst case scenario is a destroyed LLC, which is not as bad as you may think.

LLCs can save you, and it’s the best means to employ asset protection.

How to Make Houses Energy Efficient for millennials

How to Make Houses Energy Efficient for millennials in the past, people weren’t’ very environmentally-conscious about going green. It wasn’t popular, but it was a way to cut costs in the area.  While it may have been the reality back then, it’s definitely changing, and with millennial and gen Z renters increasing the tenant pool, the pressure to follow environmentally-friendly practices is increasing by a lot.  Millennials are expected to account for about 30% of the population, and gen z is supposed to be 40% of customers.  One of the things these generations value are environmental issues, and there are renters that are willing to pay more for energy-saving appliances, or even bike storage. Property managers should notice this, so how do you make your property more “green? Well, here are a few tips, since energy-efficient building and construction are actually being encouraged as of late to help cut costs for owners in the long run, and rental owners should consider incorporating new initiatives to help fill up the vacancies quickly and potentially to help justify the chances for higher rents.

The first thing to do is to change lighting, and you can do that by switching the LED bulbs since this is the fastest and easiest way to save energy and money. They generate a lot less than traditional bulbs, and typical light bulbs have dropped in sales by 85% and the prices have dropped too for green lightbulbs.  They save a home about 1000 dollars over a 10-year period, so about 8 bucks a month.

You should also consider appliances that use far less energy. Tenants that want energy-efficient appliances will consider this to be an important feature.  Not only do these energy-efficient appliances reduce pollution and save resources, they also save renters a lot of money, since they can actually reduce the electricity bills by about 30%.

You should also pick the location of your rental property.  The location does play a huge part in the ability to live in a sustainable manner. But, when it comes to going green it actually means an entirely different thing.  Being in close proximity to schools, work, shopping, restaurants, parks, and even public transit is actually a very appealing factor for many renters, since it does ultimately give them a reason to move there, since they won’t have to take as much time, or waste as much energy, getting to work.


You should also make recycling really easy.  it’s one of the easiest and least expensive ways to really influence a property and renters.  If you make recycling easier for the tenants, many times the renters will stay longer. You can make it easier by offering marked recycling containers and guidelines on how to recycle everything.  If you do own and manage a single-family property, you can even give them some pamphlets and other literature that involves curbside recycling.  You can also put it directly into the lease agreement, and the easier it is, the better it can be for everyone, and it will help with the environment as well as keep tenants around.

Finally, weatherproof and insulate your home. This is a prime way to save energy and money. You should focus on the basement, attic, and the garage since this is the easiest way for heat to enter and escape the home.  Weather stripping is actually a very cost-effective and simple way to save energy and money. Depending on the weather in a place, good insulation can save about 10-15% on the heating and cooling in the area.

With the demand to go green increasing, especially with Gen Z coming in to look for rentals, you as a property manager should look for ways to give green initiatives to those people, since it will give fewer vacancies and it will prevent rent from dipping out to lower numbers. An energy audit is also a great place to begin since t can tell you how to improve your energy efficiency easily.