Purchasing real estate simply because it is cheap, is not the smart thing to do.   While finding the hugely discounted properties is important in most cases, there are countless other things that should be considered before you jump in.  Real estate experts such as Dean Graziosi have been trained through education, research and above all, lots of experience.          

If you are in need of immediate cash from a real estate transaction, then cash flow should be one of the biggest factors in deciding whether or not a property is for you.  You need to ask yourself, will this property produce an income for me?  If you need cash now, but the property you are looking at is in no shape to rent, sell or flip without substantial work, you may want to pass on the opportunity.  In other words, if you don’t have the time to do a lot of repairs, don’t buy a fixer upper with the “hope” that it will work itself out. 

Leverage is another factor that you should consider before purchasing any property.  The more money you put down on the property, the less you can put down on another.  You want to make sure that the properties you are investing on are solid investments because the money you put down on them will ultimately determine whether you have a negative or positive cash flow.  The more debt you have in a property the greater your loss could be in the long run.  This is why it is important to invest in real estate markets that will appreciate in the long run.  If the value of the property goes up, so does your rate of return.  Choose your neighborhoods wisely and watch the market trends.  You may have to look a little further than your backyard to find a deal worth investing in.

Obviously, if you can buy a property with a large amount of equity, your chances of success just increased substantially.  Equity comes in many forms, from huge discounts and fixer uppers to foreclosures and properties that can be rezoned.  If you want to invest in a fixer upper, make sure that you are at least getting a discount equal to double of the amount you will have to invest in it to fix it. 

Lastly, never invest in any property without assessing your risk.  If you purchase a property that happens to depreciate in value, will you be able to rent it for a positive cash flow?  If you find that you can’t sell it as quickly as you wanted to, can you survive with less income or will you find yourself in dire straights?  All of these questions are worth asking before you make any real estate transaction. 

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We’ve all heard the startling news stories, the ones that provoke fear into the hearts of home owners and novice real estate investors alike.  Despite the fact that housing prices have fallen to the lowest values in decades and the credit crunch has made it difficult for consumers to get new loans, real estate experts such as Dean Graziosi, have taken the bad news and turned it into profit.  

While it is true that the vast majority of the United States is seeing astronomical foreclosure rates and low property values, there are still some housing markets that have seen appreciation of home values rather than depreciation.  Finding and purchasing homes in these areas is just one of the ways you can ensure your real estate investment success.  If you are looking to invest in the immediate future, make sure you take a close look at what the following cities have to offer.  These cities are considered to be the best housing markets in the United States in the year 2008.

Biloxi, Mississippi

Salem, Oregon

Bismarck, North Dakota

Spokane, Washington

Yakima, Washington

Austin, Texas

Grand Junction, Colorado

Fargo, North Dakota

Mobile, Alabama

Idaho Falls, Idaho

New York, New York

Glen Falls, New York

Salt Lake City, Utah

Grand Forks, North Dakota

Pascagoula, Mississippi

Hattiesburg, Mississippi

Albuquerque, New Mexico

Kellogg, Idaho

Boise, Idaho

Provo, Utah

Ogden, Utah

Edmond, Oklahoma

Oklahoma City, Oklahoma

Amarillo, Texas

Lubbock, Texas

In today’s market deals are everywhere.  The problem is that there are so many deals that for a novice investor, deciding which deals are good in the long run can be a nightmare.  While you may have to look a little further than your backyard when it comes to making a wise investment, there are definitely deals to be had if you know where to look for them.  Wise investors not only take the time to research the real estate markets they are considering, they also know when to pass up a deal.   Anyone that has any experience in real estate knows that location is one of the most important factors when deciding whether or not to invest in a particular property, and perhaps in today’s sluggish economy, it is the single most important factor. 

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Here is a little secret that Dean Graziosi has known for many years and has used to his advantage. ¨Most real estate agents don’t know very much about the market they work in.¨ Now this is an advantage to any real estate investor because it means that you as a real estate investor can become more successful just by learning. You can have an edge over real estate agents, investors, and other people in the market just by acquiring as much market knowledge as you can. It is so crucial that you research the market in which you plan on buying your real estate investment. This way you will ensure the profitability of any property you buy

Even today, when Dean Graziosi invests in real estate he learns everything he can about the market in the area, and then makes a decision on what to do as far as investments go.

Most real estate investors, agents, and anyone in the real estate market will tell you that it takes time to get that ¨sixth sense¨ which helps you understand the real estate market place for any area. But with all the technology we have available today, you don’t have to wait to get that experience through trial and error. You can begin at any time, and learn everything that will make you an expert investor. There are all sorts of places where you can pick up information. You can look online, read books, read local news. All of these sources will give you a great start at acquiring the market knowledge you need.

Here are a few rules that will get you started:

1.      The first rule of thumb is to remember that real estate is governed just as any other market by the law of supply and demand. So if the buying or selling of a home and the price will be influenced by the consumers buying and selling practices.

2.      Cause and effect also affect the real estate market, so when there are positive current events then there will be a positive effect in the real estate market.  A good economy will lead to a strong real estate market and  high appreciation of homes and when the economy hurts then the real estate market goes down, and prices go down which according to Dean Graziosi is the perfect time to buy.

3.      Look at history – It will always repeat itself. There are cycles in the Real estate market and prices will go up and down. There are periods of fast real estate appreciation and times when values neither move up nor down.

When you know what the market is doing, then you will know what you are doing and will be the expert you need to be. All you have to do is your research, and get an understanding of what is happening in both the financial and real estate world to be successful at what you do.

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In this time of unsettling economic news and talks of bailouts and stock losses, it’s time to focus on what new real estate trends are coming into play as we head into the final quarter of 2008. Here are a few for all you savvy investors:

·        The market is returning to the traditional decent price with a qualified, approved buyer who has a down payment to put towards the purchase.

·        Real Estate agents are spending more time developing quality leads in order to better sell the inventory they’re representing.

·        Agents are also putting a realistic price on a property rather than playing games with numbers and pricing real estate with an unrealistic “value range.”

·        Short sales are becoming a more common way for buyers to purchase a property.

·        The market is changing and for the better with an increase in real sellers and a decrease in buyers who are serious about purchasing a property.

·        No longer are real estate agents as concerned about what their commission is going to be and more concerned about truly representing their clients.

·        Real Estate offices are cutting staff in an effort to reduce their own overhead. Smaller staffs to manage provide real estate agents with more time to work on generating leads, following up on client calls, more time to show properties, etc.

·        The market is going from a fast market to a slower market which allows for more quality real estate deals getting done.

·        The real estate agent pool is slimming down. Gone are the agents who were only interested in making a ‘buck’ and with a smaller real estate agent market, the true real estate professional is now back in demand.

·        Strategy meetings in real estate offices are concentrating on getting back to the fundamentals of real estate where agents spend part of their day on lead generation, write tighter contracts and deal with fewer but more serious buyers.

These trends in the real estate industry are positive ones for buyers and sellers and should allow for stronger deals and quality transactions.

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Today with the real estate market being in such a slump, you want to do anything you can to make your real estate property more appealing. Actually there is a great way to make your property stand out against all others. The most popular houses on the market today are those that are energy efficient. An existing house can be retrofitted to both save and produce energy. This new type of energy efficient home is becoming very popular and houses that are environmentally friendly sell more quickly and produce more profits than comparable houses that are not environmentally friendly.If you pay attention to the news, you will know that energy costs are rising and people are becoming more aware of alternative fuels, and want to save whatever existing energy we do use. There are some things you can do to make a traditional home more energy friendly and according to Dean Graziosi more appealing to buyers.

1.      Create high performance insulation of the entire home using both air barriers and insulation. Use form fitting doors and windows that don’t allow air to escape.

2.      In stall energy efficient lighting and appliances. These are extremely attractive to potential buyers.

3.      Use solar panel cooling and heating systems. These have come way down in costs and are extremely helpful when saving energy. Dean Graziosi believes that the use of solar panels even if it’s just for water heating will improve the attractiveness of your home.

4.      If you can find someone to install a photovoltaic system to offset electrical costs, this is another great addition to a home.

Whatever you can do to make your home more energy efficient will help improve its marketability, your investment, and the price you get for it. Some of these remodeling projects are not that expensive, and others cost a bit more, but are still well worth it.

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There are a great number of bond investors out there who are experiencing reduced returns due to economic factors.  Interest rates are very low, thus bond yields, though steady and safer than holding stocks, are quite small as well.  Hundreds of billions of dollars in retirement assets are invested in government and corporate bonds in this country.

·         Government bonds, frequently backed by the “full faith and security” of the U.S. or state government, are considered quite safe.  After all, they can just raise taxes to generate revenue.

·         Corporate bonds are a bit more risky, but they almost always pay higher yields for that reason alone.  You’re betting on the continued operation and financial health of a corporation.

Perhaps you’re a bond investor with substantial holdings in either or both of these bond types.  After all, most financial planners will advise you to diversify.  They’ll also point out that bonds are safer investments, and that makes their lower yields acceptable if you are near or in retirement.  All of this is very true, and we wouldn’t advise anyone to liquidate bond holdings to re-allocate money to real estate investing…unless they do their homework at least.

If you have considered moving money from bonds to direct real estate investment, here are some characteristics of these investment types that may help to you make a decision.  Remember, we’re talking about active investing, though you may hire others to manage your properties.

·         Historically, real estate has provided appreciation and rental yields at multiples of the yield rates of bonds.

·         The history of real estate in this country has proven the safety of the investment if done properly with due diligence and intelligent purchasing.

·         While bond yields suffer with inflation, the rental property investor usually profits from it.  The cost to build goes up, so their properties appreciate, and usually rents increase with inflation as well.  All the while, your fixed mortgage payments stay the same.

·         Bonds have a fixed value, with the only return on investment coming from the interest or dividend yield.  Real estate will often produce an equal or higher rental yield, while appreciating in value as well.

·         When home buying becomes unaffordable for many, or mortgage avenues dry up, there are more tenants because they cannot afford to buy a home.

·         Our population continues to grow, with the normal first home for younger people being a rental of some kind.

Examine your life goals and your investment objectives.  If you have the time and ability to invest in real estate, particularly rental property, then you may find that a partial re-allocation of your investments from bonds to real estate is for you.

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Everyone knows that the housing market has dropped in the last year but most homeowners, real estate developers, agents and investors believe that the real estate market will get better once the new president comes to office in 2009. This belief is based on a survey taken by Harris Interactive.
The surveys findings, state that almost 50% of women and a little over 40% of men believe that the housing market will get better once the new president has taken office. It also found that 80% of current home buyers are a little nervous about the current market. The reasons for this nervousness varies a little but mainly because of high down payments, loss of faith in the economy, lower annual income levels, and higher prices in real estate.
Even so! Even though news seems to be negative in the real estate market, the survey also indicated an up side. Demand for new homes is still healthy, and many current homeowners intend to buy another home sometime in the future, and many of those plan on buying within the next five years.
Another interesting fact the survey came up with, is that almost 80% of home buyers are willing to change their spending habits so they can save money for that higher down payment. They are also willing to cut out certain neighborhood features and amenities, in order to buy a home in today’s market.
Dean Graziosi, a renown real estate investor,  believes these findings are both good news for both the homebuyer and the seller. The idea is to be aware of the current real estate market, but don’t be to scared either to put your house on the market, or to go out and find that great home you have been looking for.  It is still possible to find the real estate deal, and selling your home may take a little longer, but there are buyers out there.

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Some tips for perspective home buyers from Dean Graziosi.

1) Probably the most important tip Dean Graziosi can give perspective home buyers is before you start shopping for a home/investment, make sure you know what’s on your credit report. Most people don’t realize that your credit report can contain an array of errors. And it’s your responsibility to clean them up. You’re entitled to one FREE credit report per year. It’s worth the time to request your credit report and make sure it’s in perfect order.

2) After you’ve checked your credit report, it’s important to become pre-approved so you can shop with no worries. Your pre-approval will give you the amount the bank is willing to loan you and you can shop for a piece of property in your price range.

3) Once you start looking, make sure you’re patient. Finding the home that’s just right for you can take some time. You don’t need to buy a home for the amount you’re approved for especially with today’s real estate market becoming more of a buyer’s market. It’s important to be able to afford the house you buy.

4) Dean Graziosi suggests that you don’t use all of your savings to make that home buy. Seek out a strong mortgage professional who can find the right program for your budget and make sure you don’t use all the money you’ve saved. When you move into your new home, you’ll want some cash in case you need to do repairs or upgrades.

5) If you’re a first time home buyer or haven’t owned a place in several years, you can qualify for programs that are geared for first time home buyers. Once again, make sure your mortgage professional has provided you with all of your buying options including those first time home owner programs.

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Here are some general investment tips from Dean Graziosi….

A. Make sure you broaden your horizons with your investments. In other words, you don’t want only stocks or only real estate; rather you want a little bit of everything.

B. Research. Though you might have someone taking care of your investment portfolio, if you want to get the most out of your investments, it’s important to spend some time researching and analyzing as much information as you can.

C. Plan a strategy. Meet with your investment counselor and indicate what your high price or low price might be to initiate a sell order.

D. Think years down the road. While it’s always nice to invest in something that will pay immediate returns, it’s important to think ten, twenty even thirty years into the future.

E. Greed is bad. To paraphrase from the movie, Wall Street, it pays not to be greedy. You’re most likely not going to find an investment that will double its value in a short period of time, so sit back and let your investments grow.

F. Be Patient. Quick decisions often lead to problems. Since you’ve set up a plan with your investment counselor, don’t stray from it because of some ‘hot tip.’

G. Ask a Professional. Whether it’s stocks, bonds, T-Notes, Real Estate or another investment, find a investment professional you’re comfortable with and can afford.

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According to the Associate Press, foreclosure filings were up almost 50 percent for the month of May. Across the nation, 261,255 homes received at least one foreclosure related filing.

The article goes on to state that with weak housing sales, falling home values, tighter mortgage lending criteria and a slowing United State’s economy has forced homeowners to lost their homes through foreclosure.

All but 10 states showed an increase in foreclosure filings with Nevada, California, Arizona, Florida and Michigan with the highest foreclosure rates.

AP also reported that in some neighborhoods, lenders are dropping prices so much in an effort to get rid of their foreclosed properties.

It’s clear that homeowners have overextended themselves and though this might be bad news for some, it’s good news for those who are looking to find bargains in the real estate market.

Dean Graziosi has spent much of his adult life passing along his secrets to obtaining wealth through real estate to thousands of everyday people.

His books and lectures are filled with information to help you be a success at buying and selling property.

You don’t even have to reside in the state where you want to buy property.

The trend appears to be for continue slow housing starts and falling housing prices—the perfect recipe for investors looking for a bargain in real estate.

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