For example, if you put down 20% a year ago you will not be able to pull additional funds out and risk have the Loan to Value on a rate and term refinance coming out higher than 80%.
Another type of business you might want to try is commercial property investing. It is similar to being a landlord, but you rent to businesses. In this type of property investing, you may have a large office, restaurant or other similar building. You will want to buy investment property in a great location for businesses, such as downtown or in a high traffic area. This has the potential to make more money but you have many more people that could cause problems inside, so be ready for more potential repairs. Commercial property investments might be the way to go if you have a little extra capital to spend upfront as they generally demand more of a premium than residential areas.
Using the market data approach, the real estate agent determines the price based on comparable properties, or “comps” as they are called in the real estate biz. It’s important to remember that the “comps” need to be in the same immediate area. An identical house a mile away in the next subdivision may sell for ,000 more – or less – than your home.
However, doors and locks on fences can cost more to set up and install. This is especially the case if you plan on getting something that can only be handled with a key or an electronic code system.
Many books and courses advise you to purchase investment property located within a thirty mile radius of your personal residence. I say that’s still too far. Shoot for twenty miles, preferably fifteen.
Quality prospecting should occur each working day. The prospecting process is the first stage of prospect or client contact so it has to be relevant and professional. Practice the process so it improves your conversions and conversations.
Ideally you’re looking for entry level to lower mid-range housing, 15 – 50 years old. It’s OK if the area is a little blighted as long as things are on the upturn. Look for visible signs of redevelopment.
Do your home work and engage a good commercial real estate broker. Gather enough information on local commercial development by talking to other tenants, brokers, consultants etc. Short list some broker who adds value to your deal. Ask them, how they would help you to come to a constructive decision? How knowledgeable is your broker? Is he a chain broker, looking for a commission? Ideally a broker should give you all the valuable inputs, work out a detailed costing, and help you negotiate your lease.