by: Ben Ker

Editor’s note: I have been hard at work updating both ProAPOD Real Estate Investment Software solutions and ProAPOD Real Estate Investor Software. In the meantime, please take a look at this article on the subject of real estate investing.

Real estate investing is the classic wealth vehicle that has taken people from living hand to mouth to the pinnacle of wealth.

It’s the vehicle of choice because it’s accessible to all of us. Everyone has a least rented a house or apartment, and most of us have bought a house. So knowing what it’s like to be renter or homeowner we have first hand knowledge of our customers when we set out to be real estate investors.

The classic real estate investing model is buy a bunch of houses, rent them out and in 30 years the mortgages will be paid off, the properties will have at least doubled in value, the rents will be twice what they were when you started … with no loan payment.

The goal sounds inspiring. Imagine having 10 properties you bought 30 years ago, each for $80,000, now be worth $350,000 apiece as a result of a average annual appreciation rate of 5%. You would have a portfolio worth about $3,500,000. Monthly rents, on the low side, of $1,200 per house would give you gross monthly rents of $12,000. After T&I you probably put $9,000 in your pocket.

I think you would agree this is an extremely modest goal, but what a payoff!!

What a payoff indeed … for those who actually stick with it. You see there’s a problem with the above scenario, and that is the early years are really tough.

Cash flow is slim, expenses are high, and most investors who take this on don’t make it through.

They run out of cash.

The short-term solution is to change your focus from buying and holding to quick-turning houses for cash. Quick-turning houses, getting them under contract super cheap and flipping them to another investor for $5-20,000 or more will take care of your cashflow needs today while you hold your rental properties for long term growth. This is great … money, cash!

But you are not out of the woods yet.

Your new short-term problem is management. If you are buying houses to hold for the long term you must be prepared for the fact that you will be managing them yourself, whether you take on that job as an individual or create a management company to do it. The fact remains that at some point your occupation will change from real estate investor to landlord.

And I’m afraid gentle reader, landlording is dirty, smelly business. One you do not want to be in.

There are worse things in life than being a landlord, most definitely, but that’s not why you got into real estate. You got into real estate because you want the big dollars. The really big ones. The ‘buy your own island’ big dollars, the ‘house on each continent’ kind of dollars. The nine figure net worth.

Didn’t you?

That net worth is available, in fact it’s waiting for you to claim it, but you won’t achieve the growth necessary to get there buying single family homes. As a growth vehicle they are very inefficient.

From a real estate investing standpoint the purpose of a single family home is to give you experience doing deals, and to take care of your immediate cash needs.

After you’ve paid off all your debts, have 12 months living expenses in the bank, and have a kitty of say, $100,000 to $200,000 there isn’t much further use for single family homes.

Unless, of course, you want to be a landlord.

As soon as you are debt free and have some starting capital you should move straight into buying apartments.

There is all kinds of leverage to be achieved by changing your wealth vehicle from single family houses to apartment buildings.

- from a value standpoint when buying apartments you are dealing with much bigger dollars, so as the years go by, you make more through appreciation.

- apartments have a much higher rent per square foot compared to houses, so property management can be brought in take management out of your hands in a cost effective manner.

- apartment buildings make sense from a business standpoint so it is no difficult to attract partner capital. - there is an abundance of apartment financing available from lenders up to 80% loan to value.

- there are many profit centers, like repairing units and increasing rents, filling vancancies, that can be capitalized on to capture upside value.

Also, because apartments are not reliant on your personal attention and can be effectively managed by property management companies you are not restricted to buying in your own local market.

By becoming aware of market cycles and tracking them closely, you can buy quality properties in any market in the US at the bottom of a cycle, and ride the appreciation to the top of the market, where you sell (or exchange out) and take huge profits.

Of course, providing you live in a market (like CA) that appreciates rapidly in an up cycle, you can achieve this with single family houses too. But which property would you rather have appreciating at 15% a year, a $300,000 house, or a $10,000,000 apartment building.

After 10 years a $300,000 house will turn into $1.33M. Nothing to sneeze at. But during the same 10 years in the same market a $10M apartment building will turn into $44.4M.

Which would you rather have?

It’s an easy choice, and one you simply need to make.

About The Author

Ben Innes-Ker is a real estate investing warrior and author of the SMART Guide To Apartment Investing. He is constantly refining his systems to make his investing more profitable with less effort. He shares how to create a huge passive income buying large apartment buildings with none of your own money with his subscribers. To receive your Free SMART Guide To Apartment Investing, go to http://www.apartmenthouseprofitmachine.com.

by www.allfreereports.com

The last downturn of the global stock market saw millions of ‘every day’ investors having their fingers badly burned. Overnight life savings were eaten away, retirement funds went into decline and the economic forecast for all of us who had any money invested in stocks and shares was gloomy to say the very least.

As a direct result investors in their thousands turned their backs on the roller coaster stock markets and sought alternative asset classes in which to invest their hard earned money. This has led to a global boom in real estate markets and property prices, and it has spawned a generation of budding real estate investors.

For those of you wondering whether it’s too late to venture into real estate investing or considering how best to make the most significant returns from property investment, here are 5 hot tips for successful real estate investment to set you on the path to potential profits!

1) Consider Investment Property Abroad

There are many relatively untapped property markets in countries around the world that offer the real estate investor greater return on investment in the form of rental yields or short to medium term capital growth.

While major markets in the USA, UK, Australia and Europe are slowing down, there are emerging property markets globally that are hungry for investment and are proving to be highly profitable.

For example, in 2007 a number of countries are already aligned for accession into the European Union and as a result property markets in these countries are likely to benefit from greater numbers of visitors, more trade, increased investment into infrastructure and more stable economies. The likes of Hungary, Slovakia, Bulgaria, Croatia, Turkey and even Northern Cyprus are just a few examples of overseas destinations with emerging real estate markets that may be worthy of your consideration.

2) Make Sure Your Plans Are Profitable

This sounds ridiculously simple right? Well, you’d be surprised how few people actually make sure their plans are actually sustainable and as profitable as they hope.

Examine any real estate market that you’re about to enter by firstly comparing property values across the city, state or region and making sure you know what your money will buy you. Then ensure that the rental yield you intend to obtain from your property is actually realistic or that the asking price you intend to set once you’ve renovated the property will be offered.

3) Never Assume Anything

This goes from assuming a house is structurally sound to accepting that tax laws won’t change - from believing your tenants when they tell you that they are house proud and honest to accepting the first builder’s quotation!

Do your due diligence on every single aspect of the process from ensuring the asking price for a property is fair to checking your tax returns before your accountant submits them for you. This is your investment, your future, your potential profit and therefore it is ultimately your responsibility.

4) Employ An Expert When In Doubt

Few people are a master of all trades therefore be prepared to acknowledge areas where you are far from being an expert and at least consider courting a second opinion. Again, this goes from checking out the structural soundness of a property to understanding the legal ramifications of letting out your property. If in doubt always double check - and if this means you have to call in an expert, make sure you call in an expert!

5) Set A Realistic Budget And Stick To It

Whether you’re purchasing property to let out or buying real estate to renovate you need to sit down and add up every single area of projected expenditure to enable you to set a realistic budget with which to work.

Make sure you add in everything from having searches and surveys conducted, legal fees, accountancy fees, insurance costs, likely interest payments on any finance required, taxation, connection of utilities, marketing for tenants or buyers, real estate agency fees, and of course don’t forget to add on the cost of the property and the price of any renovation and refurnishing and decorating work required.

Spend time considering every single area where a cost will be incurred and detail every likely payment that will have to be made and you will arm yourself with a bullet proof budget and do all you can to ensure you encounter no nasty surprises along the way.

About the Author

Reports, Survey, Email Survey, Customer Report, Business Reports.

Yes, the residential housing boom we enjoyed over the past several years is in a slump. We see multitudes of houses for sale, REOs, and foreclosures. According to the National Association of Realtors, it’s bad.

1. Home prices are projected to continue falling
2. The supply of homes for sale is unlike what we’ve seen in over a decade
3. Sales of new and existing homes, as well as building permits and new construction, are all off from a year ago

The bubble has burst, single-family home sales are declining, and experts are saying that there’s no chance of any short-term relief. Overnight, it’s become a buyer’s market, and sellers, if they want to attract buyers, are going to have to lower their prices.

Okay, but bear in mind that that dismal picture has little to do with income property. Real estate investing, from all accounts, is still running on all eight cylinders. In fact, given the low interest rates, real estate investors are biting at the bit to invest in real estate.

This is no time to sing the blues. Residential real estate agents might be hurting because it is mostly their industry affected by the sub prime debacle and current slump. You, on the other hand, if you’ve been working with income-producing property and real estate investors at all, have a good opportunity to build your investment property business and not miss a step. Think about it. Great interest rates and motivated real estate investors.

It’s not a time to despair. Rather then bemoan what you see happening to residential real estate and turned off to income property, it’s more reasonable to remain engaged in real estate investing and even more pro active to seek income property transactions.