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Top 5 Reasons To Invest In Rental Properties

They say that more millionaires made their money through real estate then through any other means. There are of course many avenues for investing in real estate, but I’ve always preferred rental properties for various reasons: Real estate investing can be simple and straight forward to get started- The pathway to investing in real estate can be quite simple, you can start talking to experienced investors, read a few of the thousands of books available to learn the basics. Once you have the down payment saved and an understanding of property management (or hire a professional to help you manage) you can start. Ability to invest with leverage- By using leverage you can spread your investment wider and be more diversified. Also, if interest rates are lower than what the current return on the property is, you will effectively be borrowing money for less than what you make on it, thus increasing your return. Utilizing your connections is a good investment- Utilizing your connections in the real estate industry is key to finding the right investments, in some other industries it might be considered insider trading. Stability and Predictability- The real estate market is one of the more stable and predictable investments you can make, do the proper due diligence and manage the assets with care and you will find that it will end up better than most other investments. Multiple ways to grow your investment- With a real estate investment you have multiple ways to help your money grow, ren......
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What Is The Safest Investment You Can Make In Real Estate

The truth be told there is really no SAFE investment in real estate, there are however investments with less risk and STNL (Single Tenant Net Leased) properties are a strong leader. A STNL property is typically structured under a  triple net lease.   Under this type of lease   the tenant is solely responsible for all costs relating to the leased asset, above and beyond the base rent.    This includes the real estate taxes, building and liability insurance and maintenance and repairs.    Generally, a new STNL lease will be for a longer term (15-20 years) with options to extend and increases at set periods (either annually, or every 5 years).   This limits the chance for income fluctuations and allows for an investor to really know what their expected income and return projections will be for a long period of time. Acquiring a STNL can be a more secure investment when you have a strong tenant, you can get a local operator, regional operator or a national credit tenant. A local operator can be an individual that has this one location or a few locations, these are the more riskier of the three as the smaller operators are more susceptible to the local market fluctuations.  To offset this risk though, many operators will cross collateralize their lease with the other locations, and many times also offer a personal guarantee on the lease. A regional operator is a company that has several locations in a state or region of the country, these operators usually ......
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5 Best Apartment-Finder Apps In 2018

Looking for a new apartment is quite a challenging task no matter what your budget or needs are. If you’re in this situation, you’re probably short on time, money, and options. All the likely apartments seem to have some hidden fatal flaw or be grabbed by other renters before you can even get a tour. If this sounds all too familiar, worry not! Like everything else in this digital age, there’s an app for that. Besides visiting this website to get a head start, you can consider these apps to find your dream apartment in no time: 1.  Zillow Rentals Zillow Rentals is a highly popular renting app that’s available for both Android and Apple phones. It’s also free of cost and gives you 400,000 plus renting spaces from all over the country. All you need to do is personalize your search to get the facilities required. On-site parking, pet policy, and laundry options are at your fingertips so you never have to take a gamble again! This app’s network contains buying as well as renting options in case you haven’t completely decided on the next step. You also get to save your searches when you exit the app. This way, you can pick up where you left off and save a lot more time. 2. Trulia Rentals This app is also available for both iOS and Android networks. It can help you streamline your requests using a single click that can instantly connect you with property managers. No need to fill out forms for each and every......
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Are You Aware Of the 7 Year Rule In Background Checks

I have found that many are not aware of the 7 year rule when running a background check so I wanted to be sure you are all fully informed. The 7-year rule states that all civil suits/ judgments, non-conviction arrest records, and paid tax liens can’t be reported in a background investigation after 7 years. This rule applies to every state in the U.S., some instances, states chose to take it even further with their regulations, such as in California, New York, and Kentucky, where non-convictions can’t be reported at all, except for pending charges. Most criminal convictions are not governed by the 7-year rule. (see this chart for some of the exceptions) Since the 7-year rule is a federal guideline it applies to all states for non-criminal convictions and to many states for criminal convictions, you may find that your background check provider will only provide information according to those parameters. People earning over $75,000 annually may see arrest information longer than seven years in the past included on their background reports due to a Salary Exception, but this also depends on the state. Before requesting the report from the agencies, employers are required to provide the applicant with a clear disclaimer of disclosure and obtain the applicant’s written consent of the query. The employer is also required to inform the applicant about the types of information that will be requested in the report. If the employer decides to take adverse action as a result of the report, they are requi......
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7 Low-Maintenance Ways to Boost Your Property’s Curb Appeal

  on 7 Low-Maintenance Ways to Boost Your Property’s Curb Appeal These days, most renters find their new home through online listings, not by driving around the neighborhood. However, that doesn’t mean property managers can afford to overlook curb appeal. If your properties fail to impress when a prospective tenant drives up, it won’t matter how good the online photos look. Even property managers in highly competitive rental markets should pay attention to curb appeal. A great-looking exterior doesn’t just get tenants in the door; it also attracts high-quality tenants who are more likely to treat your property with care and respect. Of course, if you’re managing a lot of properties or a single high-density property, you don’t have a lot of time to spend manicuring lawns and flower beds. So how can you create great curb appeal without spending a lot of time? These seven tips show you how. 1. Paint the Front Door Don’t underestimate the impact a fresh coat of paint on the front door can have. A cheery front door can make an otherwise unremarkable home stand out and leave passersby wondering what’s on the other side. A Blissful Nest recommends 10 hues that are perfect for front doors. In a multi-unit property, try painting each door a different, but complementary color to set the units apart. 2. Replace House Numbers Is that newly painted front door flanked by dated, faded, or missing house numbers? Make each unit easy to find by replacing house numbers with a new set that’s easy to read from the str......
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What You Need To Know About Rent Concessions

  on What You Need To Know About Rent Concessions With rent concessions on the rise nationwide we need to have an understanding what giving or offering a concession can do to your property value if not handled correctly. Let’s start with the definition of a rent concession, a concession is any “reduction in price, rent or other benefit provided to a potential tenant as an inducement to lease your property”. There are many ways to give a concession, reducing the first month’s rent, reducing rents for a contracted time or maybe even upgrades the property they are considering ie: an accent wall or upgraded appliances. Your goal should be to have all scenarios have about the same amount of rent paid.  Also, if you can get a new tenant to accept an upgrade to the unit as a concession, it can be even more beneficial to you. What you need to consider as you are offering your concessions is how do these concession affect my long term value of my investment.  If you find yourself wanting/needing to refi and you begin the underwriting process you will find that lenders are interested in how much income an asset is producing and how much income an asset can optimally produce. Concessions add an additional layer to the equation. When underwriting the Net Operating Income of an asset, concessions are typically subtracted from the Gross Rental Income in order to determine the Net Rental Income — which also factors in things like vacancy and unpai......
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Understanding Renters Insurance Coverage

Around 95% of all homeowners presently have homeowner’s insurance. But, in 2016, just 41% of renters had renter’s insurance, despite the multiple benefits it brings to policyholders. Unlike the name suggests, renters insurance plans do more than just cover your personal items or protect you from the cost of damaging your apartment. They bring a bundle of benefits that make it well worth the small monthly charge. This article will discuss what renters insurance actually is and isn’t, who and what is covered by the typical renters insurance policy, and how you can calculate the extent of coverage you are likely to need. What Is (and Isn’t) Renters Insurance? Simply put, renters insurance covers you, anyone named on your policy (like your partner and children), your stuff, and additional costs. These could include temporary living expenses or medical and legal fees that might be incurred if you had to vacate your home for a short period or pay for damage caused to someone else or their property. May people think they don’t need renter’s insurance for a number of reasons. The three most common are listed below: Your landlord has insurance. While this may be the case, it will only cover the structure and any items that belong to them – it won’t cover you or your possessions. It costs too much and you don’t have anything worth covering. Renter’s insurance can cost as little as $5 per month. If you think you don’t have anything worth covering, just imagine for a moment what it would cost you to r......
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Ask your Residents To Write A Property Review

As multifamily property owners we tend to always be marketing our vacant units and we are always looking for better/cheaper options, at least I am, I assume many of you are also. The one thing I noticed is that we tend to overlook our reviews and the power of good reviews. One of the first things a potential new resident will do is to search your property online and if they find reviews from existing resident or past residents that have written good reviews they will be more likely to want to rent from you, now if all they find is negative reviews they will of course keep looking. The one thing you want to keep in mind is that if you have a resident that has had a difficult experience with your property they tend to want to spread the word but if you have a tenant that has had a great experience they sometimes don’t consider taking the time to let everyone know. Make it easy for them to write a review and incentivize them!  A simple request for feedback could be all it takes to increase your number of reviews or make it part of your move-out or lease-signing process by providing the renter with a questionnaire or link to the review website.  Offering an incentive like a gift card from a local retailer or a small discount on their rent for submitting a review is a great way to get them motivated. Go where your renters are- G......
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Why You Should Invest In Multifamily Instead Of Single Family Homes

Many Investors that are starting out seem to think that buying a home and leasing it out is the best way to go.  Although there are some advantages in acquiring a Single Family Residence (“SFR”) there are as many disadvantages as well.   The most pressing advantage for an SFR is that you can typically purchase them  for less money down, allowing you to make use of today’s low interest rates and leverage the return.  The low down payment can be the difference between investing now, and waiting years until you’ve saved up a larger down payment.    However, keep in mind that lenders typically consider anything that is 4 units or less to be an SFR, so you can purchase a 4 unit building for as little down as you would a house.  Of course, the main risk of investing in an SFR comes from the simple fact that if the property goes vacant you are covering 100% of the mortgage payment, taxes and insurance. My experience with newer investors in the industry tends to drive them more toward smaller multifamily investments.  Properties that have less than 5 units still fall under the guidelines for a residential mortgages so you still have the smaller down payment. The learning curve that comes with smaller properties is probably the best way to learn how you should be handling your larger investments.  As you gain industry experience and expand your portfolio, or even if you choose to hire a management company you will then know what th......
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The Downside To Raising Rents

The Los Angeles rents are likely to rise an additional 2.9% in 2018, what this means to you as a landlord is higher rental income of course, but it could also mean additional vacancies or evictions as the rental rates are pushing the renters beyond appropriate rent to income ratios. Many of the renters are choosing to relocate to an area that has better rent for them but that sometimes means driving further which as we all know in L.A. can add a good amount of additional drive time, others may try to scrape the money together every month so they don’t have to move but that’s usually a short term prospect. As a landlord you will want to consider your current residents and face the facts that if they move the cost to replace them can be significant, down time for the unit (lost revenue), the expense to turn the unit and of course advertising and in some cases you will have to pay commissions to a realtor or property management company. It can sometimes behoove a landlord to meet the resident halfway on the increase, maybe setup a plan to gradually increase their rent instead of all at once or maybe consider not doing the full percentage increase but something that is comfortable for you both (keep in mind the higher rent will  exponentially  increase the value of your asset) and will allow them to stay in their unit. If a resident tries to make ends meet but can’t and y......
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