Bryan Ellis - Virtual Real Estate Investing vs. Physical Real Estate Investing
A relatively new concept in the online world is “Virtual Real Estate Investing“. What is meant by “Virtual Real Estate Investing” ranges from online games like SecondLife (where real profit can be made) to the use of internet technologies to make normal real estate investors more profitable.
To separate fact from fiction, I asked Bryan Ellis of BryanEllis.com for comments. He’s the man many consider to be the father of this new form of investing.
Ellis says he adopted the term “virtual real estate investing” sometime before Y2K after he realized that making money online is conceptually very similar to making money with physical real estate.
An example of the similar nature of “virtual” and “physical” real estate Bryan Ellis likes to point out is the methods of making a profit from domain names compared to physical real estate. “There’s a huge difference between a website and a piece of real estate, but the ways you can profit from them are similar: ‘flipping’, rental/leasing, advertising sales, etc…all of these apply to both markets” he states.
The similarities really are obvious. Consider this: If you own a piece of real estate in a desirable neighborhood, your real estate has value because other people are interested in that location. Likewise, if you own a desirable domain name, others will find value in it because it serves their purposes. In either case, you could sell or lease the asset and turn it into cash.
In our next installment of this series on virtual real estate investing, Bryan Ellis will share the internet analogies to the physical concept of real estate development.
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The Expanding Intercontinental Property Market - Serviced by Property Index
Property Index have a range of properties for sale in Spain, from villas to apartments.
Albeit the Property Index online service may be considered a young firm, set up only in March 2007, they have advanced to expert status very quickly. In actuality they are a unbelievably unpretentious firm specializing in offering instruction to anyone who is aiming to let, sell, rent or buy realty across the globe. Their guarantee: to lend you a hand to spot squarely what’s needed quickly and, to boot, easily. Real estate is no matter where now, one of the elite areas being real property available in Spain. It’s no big deal to list a slew of the superb properties for sale in Spain, the rationale for looking into real estate here is the houses and apartments for sale and the option to live surrounded by such a energetic people.
It is one of the truly popular countries now, and in view of the lovely landscape and the wonderful climate surrounding you round the clock, how could you conceivably say no! Real estate in Spain is rich in history, this area of the world has long been home to lots of civilizations. Only one generation ago there’d be a mere dribble of English people looking for properties in Spain. Ask any one person who has chosen to remove to Spain and they’ll be sure to substantiate this. There’s many people who would prefer to see it as a craze and others prefer to see it as a almost an addiction. People keen on repairing to this area range from young families in search of a bit of a new challenge to OAPs who want to settle down and enjoy themselves.
Note that there could be hindrances when purchasing properties abroad — you’ll want to cope with dozens of disparate, not always very logical, procedures when organizing, visiting or completing. Even if but a single minor procedure is missed it may engender insurmountable hindrances and, most importantly, loss of money. Obviously, as is to be counted on with this favored destination, properties could be expensive in this location and that’s purely caused by the broad buyer demand. This notwithstanding, the patron is spoilt for choice in such a place so richly blessed by happy surroundings. It’s presently got all, stock and barrel, just about anyone might really crave and lots more.
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Mortgage Loan - Beware Balloon Payments
at 9:07 pm on Sunday, 8 June 2008
Balloon payments can be a nasty surprise for any homeowner that does not fully understand their loan contract. Here are the basics you need to understand about balloon payments and why you should avoid them.
What are Balloon Payments?
A balloon payment is simply a large sum of loan principal due at a certain time. The balloon payment can represent a portion or the entire balance of the loan principal. Balloon mortgages frequently come in the form of interest only loans. These mortgages are attractive because of they are easy to loans to qualify for and have very low monthly payments.
The problem with an interest only mortgage of this type is that the balloon payment is due at the end of the mortgage term. Loans of this type are typically only for seven to ten years. At the end of this time the principal balance is due; if you don’t have the cash you will be forced to refinance the loan. Refinancing will cost you lender fees; however, if you are unable to qualify for a new mortgage you could lose your home to foreclosure.
Many homeowners used interest only loans of this type because they could not qualify for a traditional mortgage to purchase their dream home. These homeowners could not qualify for regular financing then, and if their financial pictures have not improved, how can they expect to qualify when the balloon payment is due? These people will lose their dream homes to foreclosure.
The lesson to be learned from these homeowners is simple. Do not purchase more home than you can afford using risky financing. To learn more about borrowing responsibly, register for a free mortgage guidebook.
To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour is a mortgage professional and the owner of RefiAdvisor.com, a mortgage resource site offering a free gift for homeowners: “Mortgage Refinancing - What You Need to Know.” This guidebook helps homeowners avoid common mortgage mistakes and predatory lending practices.
Claim your free guidebook today at: http://www.refiadvisor.com
Minneapolis Mortgage Refinance
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Who’s That Knocking At My Door? Investing To Rent!
at 10:37 am on Friday, 6 June 2008
Investing to rent can create the financial and real estate success you have been searching for, but it takes hard work, thoughtful preparation and practical knowledge. As a landlord you must be creative, fearless and intuitive. In the Tidewater area approximately one out of every five homebuyers is making an investment as well, whether it’s in a second home, rental unit or a condominium for a child attending college.
In all of these circumstances you must look realistically into the future about finances, home maintenance and upkeep.
Choose Your Location Carefully
The first consideration when buying real estate for rental property is what area or region will work best. Research the area of your choice thoroughly. Check the local papers and learn about the types of rentals advertised and the average monthly rents. Talk to several real estate professionals, including property managers, and find out the average length of time a rental unit stays on the market before tenants move in. These professionals will also have insight into which locations are more desirable and what types of rentals are the hottest.
For many first time investors a smaller property is the best way to begin and it is very beneficial to hire a trustworthy and competent property manager. Read my article Property Management: The Good The Bad And The Ugly at www.voncannonrealestate.com to learn more. Once you are a seasoned landlord you can expand your vision to include larger properties. If you are buying a condominium or townhouse be certain to review the Home Owner’s Association (HOA) rules in regards to rentals with your real estate agent. The HOA often has limitations on the percentage of homes that can be used as investment rentals.
Mortgages and Rents
Once you have researched and chosen the perfect area think clearly and carefully about the type of mortgage you are qualified for. In order to purchase real estate with the intention of renting you must be certain the rents you charge cover the mortgage. Know the current rental trends and think of how your rental property will hold up in comparison. If a property’s rent is advertised above the average the property may not rent and become stale. Once stale, potential renters often have the impression something is wrong with the property.
Remember, if you purchase a property that was a rental in the past and put 5 to 10 percent down the mortgage may be too high. Investing more money, as a down payment, will lower the mortgage. As a landlord you want to have a positive cash flow, it is essential to make some profit each month, even if the profit fluctuates. Ask the current owner to review the rental history of the real estate with you. When you purchase property with more than one rental unit the mortgage you qualify for is based on the rent of the previous three years. As a buyer and new landlord the rent you charge is based on the current leases you inherit. These leases remain in affect until their renewal date.
Investing In The Future
Always buy rental investment property with the idea of re-selling in mind. When you invest in rental property you need approximately three or four months mortgage payments in reserve to cover repairs and to procure new tenants if necessary. Plan for the cost of advertising and the time of showing the rental if you are not using a property manager or real estate agent. Think realistically how much work, money and time you must invest. Always fix smaller problems, as they occur, to avoid more expensive repairs in the future.
Renovations and upgrades can also increase the return on your investment. To learn more about the types of renovations and upgrades that can increase your profitability visit www.vonannonrealestate.com and read my article Renovations and Upgrades: Bring It To The Bank. Maintenance of rental properties is incredibly important. If the property is distressed, later you will not sell for top dollar and get the highest return from your real estate investment. Real estate investment requires trusted, professional real estate advisors and planning for the future. These tools help you reach your investment goals and you can bring your real estate investment success to the bank!
Elaine VonCannon is a REALTOR with RE/Max Capital in Williamsburg, Virginia, and she manages investment property. Elaine is also an Accredited Buyer’s Representative as well as a Senior Real Estate Specialist. She has helped numerous clients invest in and make money on property in Southeastern Virginia. For more information about Virginia real estate or to read more of my educational articles please visit http://www.voncannonrealestate.com
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